Exhibit 10.36
2004 ATS MEDICAL MANAGEMENT INCENTIVE COMPENSATION PLAN (MICP)
The 2004 ATS Medical Management Incentive Compensation Plan (MICP) is designed
to pay, in addition to performance based annual salaries, incentive cash
compensation to management and other "key employees" who by their assigned
responsibilities contribute to the success of the Company. Incentive payments
will be based on corporate funding and achievement of individual
Objectives/Smart Goals.
1. DEFINITION OF TERMS
GOALS
The Individual Objectives, as set forth at the beginning of each program
year and referred to as Smart Goals, must be specific, measurable,
achievable, related to Corporate Goals and time bound. The Board of
Directors may amend the goals to reflect material adjustments in or changes
to the Company's accounting policies; to reflect major corporate changes
such as merges, acquisitions, or divestitures; and to reflect such other
events having a significant impact on the goals.
BASE SALARY
The annual salary rates effective on the first day of the Plan year.
PARTICIPANT
Any employee or position which has been designated by the Board as a
participant in the Plan for the year or during the year. If a particular
employee is not covered by the MICP and has been recognized for
extraordinary achievement, he/she may be eligible to participate in the
Plan for that particular year at the discretion of the President/CEO.
ELIGIBILITY
Only regular full time employees may be designated as a participant in the
Plan.
PROGRAM YEAR
The fiscal year of the corporation.
FUNDING
The total dollar amounts accrued for payment in any program year. The bonus
pool will be funded by achievement of the Company's annual operating Plan
and will be tied to both top line and bottom line results.
PAYOUT
The actual amount to be paid to a participant based on operating results
achievement rate combined with individual Smart Goals performance. The
maximum payout each participant is eligible to receive will be communicated
by his/her Manager.
2. DESIGNATION OF PARTICIPANTS
The Board, upon the recommendation of the management of the Corporation,
shall make all determinations as to the eligibility of employees and
positions to participate in the MICP. Following the Board's determination
of eligible participants, each participant shall be notified of eligibility
to participate in the 2004 MICP and will be provided with a copy of the
Plan. The 2004 Plan is designed to include officer, director, and manager
level positions as well as employee designated as "key employees."
3. CALCULATION AND PAYMENT OF INCENTIVE AWARDS
Individual incentives will not be paid unless the President/CEO and the
Compensation Committee of the Board of Directors approve each participant's
individual incentive awards with payout contingent upon completion of the
Company's year-end financial audit for the program year.
PLAN CRITERIA
ACHIEVEMENT OF SMART GOALS
TOP LINE RESULTS = Revenue
(80% weight)
BOTTOM LINE RESULTS=Operating Income before taxes
(20% weight)
1:0 BONUS POOL FUNDING for overachievement
1:5 BONUS POOL FUNDING for underachievement
PAYOUT RATES
PLAN PERFORMANCE 1:0 RATIO
120% 120%
115% 115%
110% 110%
105% 105%
100% 100%
PLAN PERFORMANCE 1:5 RATIO
95% 75%
90% 50%
85% 25%
80% 0%
4. PROMOTIONS
For individuals promoted from a non-bonus to a bonus position during the
program year, the effective salary upon assuming the new position will be
used in calculating eligible incentive payout. Any payout will be pro rated
beginning the first day of the month in which the individual is promoted
into the position.
5. DEMOTIONS
For individuals demoted to a non-bonus position during the plan year, MICP
payout will be pro rated based on the number of months in the bonus
position.
6. TERMINATION OF EMPLOYMENT
In the event that any participant shall cease to be a full time employee
during any year in which he/she is participating in the Plan, such
participant shall be entitled to receive no incentive compensation for such
year. If he/she terminates after the Plan year but prior to the payout, the
participant remains entitled to receive incentive compensation. An
exception would be if the individual were subject to termination "for
cause" if such "cause" took place during the period covered by the MICP.
7. AMENDMENT OF THE PLAN
The Board may, from time to time, make amendments to the Plan as it
believes appropriate and may terminate the Plan at any time, provided that
no such amendment or termination will affect the right of any participant
to receive incentive compensation in accordance with the terms of the Plan
for the portion of any year up to the date of the amendment or termination.
8. MISCELLANEOUS
Nothing contained in the MICP shall be construed to confer upon any
employee any right to continue in the employ of the Company or restrict the
Company's right to terminate his/her employment at any time.
ESTABLISHMENT OF INDIVIDUAL OBJECTIVES/SMART GOALS
(Specific, Measurable, Achievable,
Related to Corporate Goals and Time Bound.)
In establishing individual objectives, the following guidelines shall be used:
- - Each objective should be clear, concise, and measurable (time, cost, and
task accomplishment).
- - Each objective should be a precise written statement, which is discussed
and agreed to by the individual and the manager.
- - Individual objectives should measure accomplishment and not effort.
- - Individuals will have four (4) Objectives/Smart Goals.
Before a participant may receive an incentive award, it will be necessary for
his/her immediate manager to:
- - Submit written measurable objectives on the appropriate form prior to the
commencement of the program year. These objectives will be reviewed and
approved by the President/CEO and Director of Human Resources.
- - Submit a documented evaluation of results, on a quarterly basis, to the
President/CEO.
- Modifications or adjustments to the original objectives must be
reviewed by the participant and his/her manager and then submitted to
the President/CEO.
- - Submit the year-end results against objectives within one month following
the end of the program year. The President/CEO and the Director of Human
Resources will approve these.