Exhibit 10.14
Confidential Materials omitted and filed separately with the
Securities and Exchange Commission. Asterisks denote omissions.
Summary of MKS Instruments, Inc.'s
2006 Management Incentive Bonus
The 2006 Management Incentive Bonus Plan consists of a Corporate Bonus, which is
based on a 2006 corporate pro-forma pre-tax EPS target, and, for some
participants, a Product Group Bonus, which is based on the 2006 earnings targets
of certain respective product groups. With respect to Leo Berlinghieri, John
Bertucci, Jerry Colella and Ron Weigner, the 2006 Management Incentive Plan
consists solely of the Corporate Bonus. With respect to Ron Hadar, Robert Klimm
and William Stewart, the 2006 Management Incentive Plan consists of the
Corporate Bonus and the Product Group Bonus.
The following chart summarizes the individual target bonuses for each of the
participants.
Individual Target Bonus
Participant (% of annual base earnings)
- ----------- ---------------------------
Leo Berlinghieri 75%
John Bertucci 60%
Jerry Colella 50%
John Smith 50%
Ron Weigner 40%
Ron Hadar 40% (of which 70% is Corporate Bonus
and 30% is Product Group Bonus)
Robert Klimm 40% (of which 70% is Corporate Bonus
and 30% is Product Group Bonus)
William Stewart 40% (of which 70% is Corporate Bonus
and 30% is Product Group Bonus)
Copies of the 2006 Corporate Bonus Plan and 2006 Group Bonus Plans are below.
[LOGO MKS]
Technology for Productivity
2006 CORPORATE BONUS PLAN
PRO FORMA PRE-TAX EARNINGS PER SHARE (EPS) TABLE
(JANUARY 1 - DECEMBER 31)
THE PAYOUT OF YOUR CORPORATE BONUS WILL BE ACHIEVED ACCORDING TO THE SCHEDULE
SHOWN IN THE CHART BELOW. FOR EXAMPLE, YOU WILL RECEIVE 50% OF YOUR TARGET
CORPORATE BONUS IF OUR PRO FORMA PRE-TAX EPS REACHES $**, AND 100% OF YOUR
TARGET CORPORATE BONUS IF OUR PRO FORMA PRE-TAX EPS REACHES $**. AT A PRO FORMA
PRE-TAX EPS OF $** OR MORE, YOU WOULD RECEIVE 200% OF YOUR TARGET CORPORATE
BONUS,
Pro forma % of Target
Pre-Tax EPS Bonus Earned
----------- ------------
<$** 0.0%
$** 15.0%
$** 25.0%
$** 35.0%
$** 50.0%
$** 75.0%
$** 85.0%
$** 100.0%
$** 125.0%
$** 150.0%
$** 175.0%
>=$** 200.0%
THIS INFORMATION IS EXTREMELY CONFIDENTIAL AND SHOULD BE TREATED AS SUCH. YOU
SHOULD NOT DIVULGE THIS INFORMATION INSIDE OR OUTSIDE OF MKS INSTRUMENTS, INC.
PERSONAL AND CONFIDENTIAL
=========================
[LOGO MKS]
Technology for Productivity
2006 [APPLICABLE](1) GROUP BONUS PLAN
THE PAYOUT OF YOUR PRODUCT GROUP BONUS WILL BE CALCULATED BASED UPON ACTUAL
[APPLICABLE] PRODUCT GROUP EARNINGS FOR 2006. THE CHART BELOW SHOWS THE
CORRELATION BETWEEN ACTUAL [APPLICABLE PRODUCT GROUP] EARNINGS AND YOUR BONUS
PAYOUT. FOR EXAMPLE, YOU WILL RECEIVE 50% OF YOUR TARGET PRODUCT GROUP BONUS IF
THE [APPLICABLE] PRODUCT GROUP EARNS $** MILLION IN 2006 AND 100% OF YOUR TARGET
PRODUCT GROUP BONUS IF THE GROUP EARNS $** MILLION. IF THE GROUP EARNS $**
MILLION OR MORE YOU WOULD RECEIVE 200% OF YOUR TARGET PRODUCT GROUP BONUS.
Percent of
[applicable]
[applicable] product product group
group earnings ($mm) bonus paid
-------------------- -------------
<$**mm 0.0%
$**mm 15.0%
$**mm 25.0%
$**mm 35.0%
$**mm 50.0%
$**mm 75.0%
$**mm 85.0%
$**mm 100.0%
$**mm 125.0%
$**mm 150.0%
$**mm 175.0%
>=$**mm 200.0%
THIS INFORMATION IS EXTREMELY CONFIDENTIAL AND SHOULD BE TREATED AS SUCH. YOU
SHOULD NOT DIVULGE THIS INFORMATION INSIDE OR OUTSIDE OF MKS INSTRUMENTS, INC.
PERSONAL AND CONFIDENTIAL
=========================
(1) The Group Bonus Plan portion of the 2006 Management Incentive Bonus Plan
relates only to Ron Hadar (CIT products), Bob Klimm (ASTeX products) and Bill
Stewart (Vacuum products).
Summary of Bonus Arrangement for Frank Schneider
------------------------------------------------
Frank Schneider, who became the Company's VP and GM of Ion Products when the
Company acquired Ion Systems, Inc. ("Ion") in January 2006, is entitled pursuant
to the terms of the acquisition agreement to continue to receive a bonus under
the Ion bonus plan. Mr. Schneider's bonus will equal up to a maximum of 50% of
his base salary and will be paid as follows: 75% based on Ion's performance to
its operating income goals for the fiscal year ending June 30, 2006, and 25%
based on his performance to individual goals that were specified by the board of
directors of Ion. The board of directors will evaluate Mr. Schneider's
performance to the specific goals.
Ion's performance will be evaluated based on its achievement of its annual
operating income goal. The operating income goal for Ion and its subsidiary for
the year ending June 30, 2006 is $**. Ion must achieve at least 80% of its
annual operating income goal in order for the bonus to be paid. Below is the
schedule of bonus payout percentages based on the percentage of annual operating
income goal achieved.
% of Annual Operating Income Goal Achieved Bonus Payout %
- ------------------------------------------ --------------
From 150% to 100% Payouts in this range are matched
percentage to percentage
99% 98%
98% 96%
97% 94%
96% 92%
95% 90%
94% 88%
93% 86%
92% 84%
91% 82%
90% 80%
89% 78%
88% 76%
87% 74%
86% 72%
85% 70%
84% 68%
83% 66%
82% 64%
81% 62%
80% 60%
The portion of the bonus related to Mr. Schneider's individual goals will have a
maximum payout of 100%. Bonuses will be paid annually based on performance to
his goals, and on Ion's performance for the entire fiscal year period. No bonus
either based on individual goals or operating income will be paid if the
operating income does not equal or exceed 80% of goal. There is no additional
payout for performance above 150% of the quota. Mr. Schneider must be employed
by MKS Instruments, Inc. on the date that bonuses are paid in order to receive
his bonus.