Exhibit 10.6
MICHAEL R. DOUGLAS
2003 EXECUTIVE BONUS PLAN
You are eligible for an annual bonus of 100% of your annual base salary, subject
to achievement of certain goals and objectives, with the ability to earn a bonus
of up to 200% of your annual base salary, subject to exceeding such goals and
objectives. Your 2003 bonus award will be based on the following:
CORPORATE FINANCIAL PERFORMANCE ELEMENT: 70% WEIGHT
Corporate financial performance element calculated pursuant to the following
chart:
INCOME OI
VS `02 (000,000) % % % % % % %
- ------ --------- --- --- --- --- --- --- ---
34.50 $(22.50) 86 93 100 107 114 121 128
33.25 $(23.75) 78 86 93 100 107 114 121
31.00 $(25.00) 71 78 86 93 100 107 114
29.75 $(26.25) 64 71 78 86 93 100 107
28.50 $(27.50) 57 64 71 78 86 93 100
27.25 $(28.75) 50 57 64 71 78 86 93
26.00 $(30.00) 43 50 57 64 71 78 86
24.75 $(31.25) 36 43 50 57 64 71 78
23.50 $(32.50) 29 36 43 50 57 64 71
REVENUE 233 240 247 254 261 268 275
(000,000)
INCREASE 13 20 27 34 41 48 55
VS. `02
NOTES:
Target Bonus (100%) is achieved at original AOP.
Current forecast produces a 50% payout.
For results better than those depicted on the above chart, Compensation
Committee may increase bonuses at its discretion.
For results worse than those depicted on the above chart, Compensation Committee
may decrease or eliminate bonuses at its discretion.
Eligibility for 200% bonus requires $325 million of revenue (25% improvement
over plan), Operating Income better than $(20 million) for the year, and
positive 4th Quarter Operating Income.
Operating Income to be calculated excluding the impact of:
AOL settlement;
Litigation settlements;
Extraordinary traffic buys (i.e. MSN).
INDIVIDUAL PERFORMANCE OBJECTIVES: 30% WEIGHT
- Effectively manage shareholder litigation and SEC/DOJ investigation.
In addition to achieving a favorable result, this includes
establishing a budget for each matter and providing monthly
reporting of actuals to budget.
- Maximize the efficient use of the resources of Homestore's Legal
Department, performing as much of the Company's legal work as
practicable utilizing in-house resources, reserving outside counsel
for extraordinary items (e.g. major transactions litigation) and
advice with respect to specialty areas of expertise that are not
cost-effective to develop in-house.
- Deliver a high-quality work product that meets expectations and, in
each instance possible, exceeds expectations.
- Reduce the size and cost of the Homestore Legal Department to a
level appropriate to the Company's business and legal needs.
- Reduce the number of outside law firms providing services to
Homestore. This reduction should result in greater efficiencies,
reduced costs and stronger relationships with outside counsel.
- Continue to actively oversee and improve upon the mentoring program
and skills development of the internal legal staff.
- Continue to assume a very active and visible role in all
extraordinary items, including major litigation and any major
transaction, while at the same time managing an active legal
department in which work is delegated, as appropriate, to senior
counsel for them to work on directly or to supervise the work of
more junior attorneys; in all cases, ensuring high-quality legal
advice and high-quality work product.
- As General Counsel, continue to build relationships with members of
senior management, other members of management and the Board such
that the General Counsel is viewed as the Company's primary counsel
and the person to whom all of the foregoing look to for legal
advice.
- Continue to actively oversee and improve upon the mentoring program
and skills development of the internal legal staff.
- Identify, retain and integrate a highly competent Vice President of
Human Resources into Homestore's Human Resources Department.
Final determination of bonus award if any is subject to Compensation Committee
approval. Payment of any bonus award shall be based on the Company's overall
financial position at the time performance is reviewed by the Committee. Final
approved bonus will be paid after year-end close (i.e. bonus is annual, not
quarterly).