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EXHIBIT 10.15
CONFIDENTIAL
MANAGEMENT BONUS PLAN
FOR
INTERMET CORPORATION
MASTER COPY
1993
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TABLE OF CONTENTS
Page
I. Introduction 1
II. Purpose of the Plan 1
III. Definitions 1
IV. Participation 3
V. Bonus Potential 4
VI. Objective Setting and Performance Measurement 5
VII. Actual Bonuses 5
VIII. Form and Timing of Bonus Payments 8
IX. Administration of the Plan 9
X. Additional Provisions 9
XI. Exhibit 1 - Participants and Target Bonuses
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I. INTRODUCTION
The compensation strategy of Intermet Corporation (the Company) includes
providing its executives and certain other employees the opportunity to earn
annual bonuses based upon Company and/or organizational unit performance during
the year. This document contains the guidelines for implementing the
Management Bonus Plan (the Plan), which provides for cash payments of bonuses
based on achievement of Company and organizational unit objectives for the
Performance Period.
II. PURPOSE OF THE PLAN
The purpose of the Plan is to enable the Company to:
- attract and retain executives and other key employees by
providing a competitive annual bonus opportunity, and
- motivate and reward executives and other employees for their
success in accomplishing Performance Period objectives.
The remainder of the Plan document describes the essential elements for
administering the Plan, including definitions of terms, selection of
participants, bonus potential, objective setting and performance measurement,
bonus payouts, and other provisions.
III. DEFINITIONS
The following terms shall have the meanings indicated for purposes of the Plan:
(a) "Actual Bonus" shall mean the amount of any Annual Bonuses earned
by the Participant for the Plan Period. The Compensation
Committee shall approve the Actual Bonuses for all Participants.
(b) "Annual Bonus" or "Bonus" shall mean a cash bonus payment under
this Plan which is contingent upon the achievement of Company
and/or organizational unit objectives.
(c) "Board" shall mean the Board of Directors of the Company.
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(d) "Cause" shall mean a felony conviction of a Participant or the
failure of a Participant to contest prosecution for a felony,
or a Participant's willful misconduct or dishonesty which is
harmful to the business or reputation of the Company or a
Subsidiary, or a Participant's willful and substantial
non-performance of assigned duties. The determination of
"Cause" shall be made by the Compensation Committee based upon
the information available to it and any such determination
shall be final and binding on the affected Participant.
(e) "Company" shall mean Intermet Corporation, a Georgia
corporation, its successors or assigns.
(f) "Compensation Committee of the Board of Directors" or
"Compensation Committee" shall mean the directors of the Company
who shall be appointed from time to time by the Board, and who
shall oversee the setting of compensation for the Company's
executive officers and key personnel, including the development,
interpretation, and administration of the Management Bonus Plan.
(g) "Disability" shall mean total and permanent disability that
would qualify a Participant for benefits under the Company's
long-term disability plan or if such plan is not in existence, as
determined by the Compensation Committee.
(h) "Measurement Date" shall mean the last day of Plan Year.
(i) "Objectives" shall mean the financial and/or other measures
selected to gauge performance during a Performance Period.
(j) "Organizational Unit" shall mean either one, or more than one,
of the principal companies that collectively form Intermet
Corporation, or any facility or departmental entity for which a
performance objective has been established.
(k) "Participant" shall mean any executive or other key employee of
the Company or a Subsidiary who is selected by the Compensation
Committee, or the Compensation Committee's designated appointee,
to be a Participant under the Plan with respect to a Plan Year.
Participants shall be designated for each Plan Year and shall be
listed in Exhibit 1. Participants shall be designated as either
a Corporate Participant, or an Organizational Unit Participant.
(l) "Performance Period" shall mean the fiscal year for which
Company and/or organizational unit objectives are established.
Its meaning is the same as Plan Year.
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(m) "Plan" shall mean the Management Bonus Plan of Intermet
Corporation set forth herein (including all Exhibits) and as it
may be amended from time to time.
(n) "Plan Year" shall mean the Company's fiscal year beginning on or
about January 1.
(o) "Retirement" shall mean normal or early retirement of a
Participant under the provisions of a company retirement plan.
(p) "Subsidiary" shall mean any corporation of which 50% or more of
the common stock is owned by the Company, or of which 50% or
more of the common stock is owned by another subsidiary.
(q) "Target Bonus" shall mean the Target Annual Bonus, expressed as
a percent of salary for the Plan Year, and it shall be one
factor in determining the Actual Bonus, if any, as of the
Measurement Date. Target Bonuses shall be approved by the
Compensation Committee, or the Compensation Committee's
designated appointee, for each Participant on or as close as
possible to the beginning of the Plan Year and shall be
designated in Exhibit 1.
IV. PARTICIPATION
Participants in the Plan are selected by the Compensation Committee.
Participants shall be notified of their selection to participate in the Plan on
or before the beginning of the Plan Year, or as soon thereafter as is
practicable. Selection of Participants shall apply only to the applicable Plan
Year; selection to participate in one Plan Year is no guarantee of
participation in future Plan Years. Participants may include the executive
officers and other key employees of the Company or a Subsidiary who may be
selected from time to time by the Compensation Committee in their sole
discretion. Participants will be selected, among other things, based on their
ability to impact the company's achievement of its Performance Period
objectives. All Participants must be employed by Intermet Corporation or a
Subsidiary of the Company, on the first day of the Plan Year and maintain
continuous employment in the same or a similar position through the end of the
Plan Year. The Compensation Committee, in their sole discretion, may approve
the participation of an executive officer or other key employee who through
internal
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promotion or recruitment (or other similar reasons) fills a position after the
beginning of the Plan Year but may have a significant impact on the Company's
achievement of its Objectives for the Plan Year. In that event, the
Participant may earn a pro rata Bonus, contingent upon Company and/or
Organizational Unit performance. Participants who terminate employment with
the Company or a subsidiary for any reason prior to the end of the Plan Year,
forfeit any Bonus which they could have earned under the Plan Year. The
Compensation Committee, in their sole discretion, may approve the payment of
pro rata awards to a Participant who terminates employment during a Plan Year
due to death, Disability, or Retirement or other termination of employment by
the Company or a Subsidiary for a reason other than Cause. Any such payments
would be made after the end of the Plan Year at the same time and in the same
manner that Annual Bonuses are paid to other Participants. No such payments
may be authorized under this Plant to a Participant whose employment is
terminated for Cause.
In the event that a Participant terminates employment with the Company or a
Subsidiary for any reason following the end of the Plan Year but prior to
payment of any Actual Bonus, any unpaid Actual Bonus shall be forfeited, and
the Participant shall have no further right, title, or interest under the Plan;
provided however that this forfeiture provision shall not apply where such
termination is by reason of the Participant's death, Disability, or Retirement
or termination of employment (whether voluntary or involuntary) for a reason
other than Cause, in which event the payment of the Actual Bonus shall be made
in the normal course in accordance with the Plan. The Compensation Committee
may, in its discretion, approve the payment of all or part of the Actual Bonus
to other Participants who terminated employment after the end of the Plan Year
but prior to the payment date, provided, however, that such payments may be
authorized to a Participant whose employment is terminated for Cause.
V. BONUS POTENTIAL
The Plan allows each Participant to earn an Annual Bonus contingent upon the
results achieved during the Plan Year. Each Participant's Annual Bonus
potential is established on or as close as possible to the beginning of the
Plan Year. The bonus potential, or Target Bonus, for the Plan Year is
expressed as a percentage of base salary, and it is intended to provide a
competitive Annual Bonus, contingent upon performance. Target Bonuses for each
Participant for the Plan Year are shown in Exhibit 1.
The Compensation Committee establishes the Target Bonus for each Participant.
The extent to which the Target Bonus is earned will be approved by the
Compensation Committee after the end of the Plan Year based on actual results
achieved. The value of any Actual Bonus may be greater than or less than the
Target Bonus, depending upon performance during the Plan Year.
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VI. OBJECTIVE SETTING AND PERFORMANCE MEASUREMENT
The Plan is intended to reward Participants for contributing to the achievement
of Company Objectives and accomplishing Organizational Unit Objectives for the
Performance Period. The Compensation Committee establishes the Company
Objectives at or near the beginning of the Plan Year. The Company Objective
guide the development of Organizational Unit Objectives for Participants in the
Plan.
Company Objectives will be comprised of one or more measures of Company, and/or
Organizational Unit, financial performance. For each Objective, the
Compensation Committee will establish a range of performance defined by a
target, minimum, and maximum level. The target represents the planned level of
performance (100% achievement of the Objective). The minimum represents the
lowest level of performance at which Bonuses may begin to be earned. This
typically will be 80% of the target. The maximum represents the highest level
of performance which is likely to be attained during the Performance Period.
This typically will be 120% of the target.
After the end of the Plan Year, when final result are known, the Compensation
Committee will determine how Company performance and Organizational Unit
performance compared to the Performance Period Objectives. Based on these
evaluations of performance, Participants may earn Bonuses under this under
Plan.
VII. ACTUAL BONUSES
The Company's financial performance determines if Actual Bonuses can be paid to
Participants. The Company's financial performance measure that will be used
for Plan payout purposes is determined annually.
The threshold point for paying Actual Bonuses is the Company's financial
performance measure reaching 80% of its target. If the Company achieves 80% of
its target, then Participants' Bonuses will be paid. If the Company does not
achieve 80% of its target, then no Participant will be paid a Bonus.
A. Corporate Participants
At the end of a Performance Period, the following table will be used to measure
the Company's financial performance and to calculate a Participant's Actual
Bonus.
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COLUMN A COLUMN B
-------- --------
Percent of
The Company's
Actual Financial Performance A Participant's Target Bonus
vs. Is Multiplied
Financial Performance Target By This Percentage
Less Than 80% 0%
80% 50%
90% 75%
100% 100%
110% 125%
120% 150%
Greater Than 120% 150%
If the Company achieves 100% of its financial performance target (Column A), a
Participant's Target Bonus would be multiplied by 100% (Column B) to determine
the Participant's Actual Bonus. If the Company reaches 120% of its financial
performance target, a Participant's Target Bonus would be multiplied by 150%.
Similarly, if the Company reaches only 80% of its financial performance target,
a Participant's Target Bonus would be multiplied by 50%.
If financial performance attainment equals a percentage other than one
displaced in Column A, then the accompanying bonus percentage from Column B is
interpolated mathematically.
B. Organizational Unit Participants
An Organizational Unit Participant's Target Bonus is split into two components.
Forty percent of the Participant's Target Bonus is based on the Company's
financial performance. The remaining 60% of a Participant's Target Bonus is
based on the Participant's Organizational Unit's performance. The Company's
financial performance, in conjunction with the Participant's Organizational
Unit's performance, determines the Participant's Actual Bonus.
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The first component of an Organizational Unit Participant's Actual Bonus is
calculated using Table I. Table I outlines how 40% of a Participant's Target
Bonus is impacted by the Company's financial performance. If the Company's
financial performance reaches 80% of its target (Table I, Column A), 40% of an
Organizational Unit Participant's Target Bonus would be paid at the 50% level
(Table I, Column B). If 100% of the Company's financial performance target is
reached, 40% of the Organizational Unit Participant's Target Bonus would be
paid at 100% level. Likewise, 120% financial performance achievement would
result in 40% of the Organizational Unit Participant's Target Bonus being paid
at the 150% level.
TABLE I
COLUMN A COLUMN B
-------- --------
Percent of
The Company's 40% of a Participant's
Actual Financial Performance Target Bonus
vs. Is Multiplied
Financial Performance Target By This Percentage
Less Than 80% 0%
80% 50%
90% 75%
100% 100%
110% 125%
120% 150%
Greater Than 120% 150%
If financial performance attainment equals a percentage other than one
displayed in Column A, then the accompanying bonus percentage from Column B is
interpolated mathematically.
If the Company's financial performance is greater than or equal to 80% of its
financial performance target, Table II will be used to assess a Participant's
Organizational Unit's financial performance and the second component of an
Organizational Unit Participant's Actual Bonus will be calculated. If a
Participant's Organizational Unit's financial performance is less than 80% of
its financial performance target, the Organizational Unit Participant would
still receive the component of his Bonus that is based on the Company's
financial performance. If the Company's financial performance is less than 80%
of its financial performance target, no Bonus based upon an Organizational
Unit's Financial Performance will be paid.
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TABLE II
COLUMN A COLUMN B
-------- --------
Percent of
Organizational Unit's 60% of a Participant's
Actual Financial Performance Target Bonus
vs. Is Multiplied
Financial Performance Target By This Percentage
Less Than 80% 0%
80% 50%
90% 75%
100% 100%
110% 125%
120% 150%
Greater Than 120% 150%
If a Participant's Organizational Unit achieves 100% of its financial
performance target (Table II, Column A), 60% of an Organizational Unit
Participant's Target Bonus would be multiplied by 100% (Table II, Column B) to
determine the second component of the Organizational Unit Participant's Actual
Bonus. If a Participant's Organizational Unit reaches 120% of its financial
performance target, 60% of an Organizational Unit Participant's Target Bonus
would be multiplied by 150%. Similarly, if a Participant's Organizational Unit
reaches only 80% of its financial performance target, 60% of an Organizational
Unit Participant's Target Bonus would be multiplied by 50%.
If financial performance attainment equals a percentage other than one
displayed in Column A, then the accompanying bonus percentage from Column B is
interpolated mathematically.
VIII. FORM AND TIMING OF BONUS PAYMENTS
Actual Bonuses, if any, will be approved by the Compensation Committee and will
be paid in cash in a lump sum after the end of the Plan Year when final results
are known and performance against Objectives can be determined. Payment will
be made no later than March 15 of the calendar year following the Plan Year.
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IX. ADMINISTRATION OF THE PLAN
The Compensation Committee is responsible for the maintenance and
administration of the Plan. Those activities include but are not limited to
selecting Participants, maintaining a list of current Participants,
establishing Company and Organizational Unit Objectives, establishing a Target
Bonus for each Participant, monitoring performance during the Plan Year,
measuring performance at the end of the period, approving the amount of any
Actual Bonuses, and directing that Actual Bonuses be paid to eligible
Participants. The Board is responsible for approving the Compensation
Committee's recommendations.
X. ADDITIONAL PROVISIONS
A. Amendment or Termination
The Company may amend, alter, or discontinue the Plan at any time without prior
notice, subject to the following limitations:
(i) No such termination or amendment shall adversely affect the
right, title or interest of the Participant in an Actual Bonus
for which the Plan Year has already ended, and the Plan shall
continue with respect to the Actual Bonus on its original
terms until such Actual Bonus has been paid in full.
(ii) In the event of any Plan termination, or in the event of an
amendment which shall adversely affect the right, title or
interest of the Participant with respect to such Plan Year,
any uncompleted Plan Year shall be deemed to have ended on the
effective date of such termination or amendment, performance
shall thereupon be administered in accordance with Article VI
and, assuming the Compensation Committee determine the
performance criteria have been met, pro rata awards will be
paid based upon the portion of the Plan Year which elapsed
between the beginning of the Plan Year and the date of such
termination or amendment.
B. Effective Date of the Plan
The Plan shall become effective upon its approval by the Company. It shall
continue in effect until such time as the Company chooses to discontinue the
Plan. Initial implementation of the Plan may be made retroactive to the
beginning of the fiscal year in which the Plan is adopted.
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C. Authority of the Compensation Committee
The construction and interpretation of the Plan by the Compensation Committee
shall be final and binding upon the Company and all Participants. The
authority of the Compensation Committee shall specifically include, but not be
limited to the resolution, in accordance with the Plan, of any issue regarding
establishing or amending annual Objectives, evaluating Company or Organization
Unit performance relative to the annual Objectives, determining the extent to
which any Target Bonuses were earned, and determining whether any Actual
Bonuses are payable.
D. Delegation
The Compensation Committee may delegate a portion of their duties to an officer
or other employee or group thereof, of the Company.
E. Records and Rules
The Company shall keep written records sufficient to reflect the identity of
Participants in each Plan Year, their Target Bonuses, any Company or
Organizational Unit Objectives for the Plan Year and the Determination of
Actual Bonuses. The Company may adopt such rules as it shall deem reasonable
and appropriate to the administration of the Plan.
F. Employment and Other Rights
Nothing contained herein shall require the Company to continue any Participant
in the Company's or a Subsidiary's employ, or require any Participant to
continue in the Employ of the Company or a Subsidiary, nor does the Plan create
any rights of any Participant, or Beneficiary or any obligations on the part of
the Company or a Subsidiary other than those set forth herein. The Actual
Bonuses payable under this Plan shall be independent of any and in addition to,
any other agreements that may exist from time to time concerning any other
compensation or benefits payable by the Company or a Subsidiary.
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G. Right to Benefits
The sole interest of each Participant under the Plan shall be to receive the
Actual Bonuses provided herein, if and when the same shall become due and
payable in accordance with the terms hereof, and no Participant shall have any
right, title or interest in or to any of the specific assets of the Company or
a Subsidiary. All Actual Bonuses hereunder shall be paid solely from the
general assets of the Company and no employer shall maintain any separate fund
or their segregated assets to provide any benefits hereunder. In no manner
shall any assets of the Company or a Subsidiary be deemed or construed through
any of the provisions of this Plan to be held in trust for the benefit of any
Participant or to be collateral security for the performance of the obligations
imposed by the Plan on the Company. The rights of any Participant shall be
solely those of a general unsecured creditor of the Company, as determined
under applicable law.
H. Offset to Benefits
Any other provision of the Plan to the contrary notwithstanding, the Company
may, if the Compensation Committee in their sole and absolute discretion shall
determine, offset against any amounts to be paid to a Participant under the
Plan any amounts which such Participant may owe to the Company or a Subsidiary.
I. Nonalienation of Benefits
Except as otherwise mandated by law, no benefit, payment or distribution under
this Plan shall be subject either to the claim of any creditor of a
Participant, or to attachment, garnishment, levy, execution or other legal or
equitable process, by any creditor of such person, and no such person shall
have any right to alienate, commute, anticipate or assign (either at law or
equity) all or any portion of any benefit, payment or distribution under this
Plan. The Plan shall not in any manner be liable for or subject to the debts,
contracts, liabilities, engagements or torts of any person entitled to benefits
hereunder.
In the event that any Participant's benefits are garnished or attached by order
of any court, the Company may elect to bring an action for a declaratory
judgment in a court of competent jurisdiction to determine the proper recipient
of the benefits to be paid by the Plan. During the pendency of said action,
any benefits that become payable may be paid into the court as they become
payable, to be distributed by the court to the recipient as it deems proper at
the close of said action.
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J. Withholding and Deductions
All payments made by the Company or a Subsidiary under the Plan to any
Participants shall be subject to applicable withholding and to such other
deductions as shall at the time of such payment be required under any income
tax or other law, whether of the United States or any other jurisdiction.
Determinations by the Company as to withholding with respect thereto shall be
binding on the Participant.
K. Merger/Consolidation/Change of Control
In the event that the Company or a Subsidiary shall merge or consolidate with
any other corporation or organization, or its business activities are taken
over by any other organization, and such succeeding or continuing corporation
or other organization shall fail to expressly assume the rights and obligations
of such employer under the Plan and agree to continue the Plan for the Plan
Year, the date immediately prior to the date of such merger, consolidation or
takeover shall be deemed the date of termination of the Plan and Participants
shall be entitled to benefits in accordance with Article X, A(ii). Any Actual
Bonus which has been approved by the Compensation Committee but has not been
paid prior to the date of such merger, consolidation or change of control shall
continue as an obligation of the Company or of such succeeding or continuing
corporation or other organization and shall be paid in accordance with the
Plan.
L. Adjustments
Any other provision of the Plan to the contrary notwithstanding, the Company in
its sole discretion and in light of the Objectives of the Plan may take such
action as it shall deem reasonable and appropriate in the determination of
annual Objectives, the Company's and/or an Organizational Unit's performance
with respect thereto, and/or the resulting Actual Bonus to adjust for the
distortive effects, if any, or any singular event(s) and/or extraordinary
item(s) arising in the conduct of the business of the Company or a Subsidiary.
Such event(s) and/or item(s) may result from, but are not necessarily limited
to, a change in accounting method, the sale of assets and/or business
operations, a restructuring or reorganization of the Company or a Subsidiary or
other unexpected event which materially alters the financial performance of the
Company and/or its Organizational Units.
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M. Construction
In the construction of the Plan, the masculine shall include the feminine and
the singular the plural in all cases where such meanings would be appropriate.
N. Effect of Invalidity of Provision
If any provision of this Plan is held invalid or unenforceable, such invalidity
or unenforceability shall not affect any other provisions hereof, and this Plan
shall be construed and enforced as if such provision had not been included.
O. Inurement
This Plan shall be binding upon and inure to the benefit of the Company and its
successors and assigns and the Participants, and their administrators and
beneficiaries.
P. Personal Liability
Members of the Board of Directors or the Compensation Committee, nor any
officer or Employee of the Company or a Subsidiary acting on behalf of the
Company or Subsidiary shall be personally liable for any action, determination,
or interpretation taken or made with respect to the Plan, and all members of
the Board or the Compensation Committee and each and any officer or employee of
the Company or a Subsidiary acting on their behalf shall be fully indemnified
and protected by the Company in respect of any such action, determination or
interpretation.
Q. Corporate Rights
The existence of the Management Bonus Plan shall not affect the right or power
of the Company to make adjustments, recapitalizations, reorganizations, or
other changes to the Company's capital structure or its business; issue bonds,
debentures, common, preferred or prior preference stocks; dissolve or liquidate
the Company, or sell or transfer any part of its assets or business; or any
other corporate act, whether of a similar character or otherwise.
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R. Controlling Law
The validity, interpretation, and administration of the Plan and of any rules,
regulations, determinations, or decisions made thereunder, and the rights of
any and all persons having or claiming to have any interest therein or
thereunder, shall be determined exclusively in accordance with the laws of the
State of Georgia. Without limiting the generality of the foregoing, the period
within which any action in connection with the Plan must be commenced shall be
governed by the laws of the State of Georgia.
S. Execution
IN WITNESS WHEREOF, the company has caused this Plan to be signed by its duly
authorized officers this 31st day of August, 1993.
INTERMET CORPORATION
Attest: /s/ John D. Ernst By: /s/ James W. Rydel
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Title: V. P. Human Resources
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XI. EXHIBIT 1 - PARTICIPANTS AND TARGET BONUSES