Synergy-Based Incentive Plan
- Executives have a synergy-based incentive target on top of the current annual incentive plan (AIP)
- Department heads will have the ability to allocate discretionary pools to other employees
- Eligibility: Management plus other employees involved in workstreams
- Synergy goals are set as an add-on to the current AIP
- The synergy plan target would be prorated. If paid at six months, then 37.5% of base salary would be paid. If paid at 18 months, 112.5% of base salary would be paid.
- Management would be allocated pools to distribute on a discretionary basis to those employees facilitating the achievement of synergy goals
- Regular AIP payments in Year 2 would only be made if synergy goals are achieved
Incentive Plan Funding
- Synergies must reach a certain threshold before the plan will fund
- Incentives are based on a percentage of incremental dollars saved that are in excess of public synergy goals
- If synergy guidance of $100 million was communicated to investors, there would be no synergy-based incentives available until at least $100 million in synergies were achieved ...