Attached files
| file | filename |
|---|---|
| 8-K - FREDERICK'S OF HOLLYWOOD GROUP INC /NY/ | v189912_8k.htm |
| EX-10.1 - FREDERICK'S OF HOLLYWOOD GROUP INC /NY/ | v189912_ex10-1.htm |
| EX-10.3 - FREDERICK'S OF HOLLYWOOD GROUP INC /NY/ | v189912_ex10-3.htm |
| EX-10.2 - FREDERICK'S OF HOLLYWOOD GROUP INC /NY/ | v189912_ex10-2.htm |
EXHIBIT
10.4
ANNUAL
INCENTIVE BONUS PLAN
The Board
of Directors (“Board”) of Frederick’s of Hollywood Group Inc. (“FOHG”) has
adopted this Annual Incentive Bonus Plan (“Plan”) on June 29, 2010, effective
with FOHG’s 2011 fiscal year, which begins on August 1, 2010 and ends on July
30, 2011.
Purpose. The Plan provides for
select employees of FOHG and its subsidiaries to receive annual cash incentive
payments based on the achievement of specific goals and objectives established
by the Board and/or Compensation Committee of the Board
(“Committee”).
Plan
Administration. The Plan will be administered by the
Committee. The Committee’s powers include, but are not limited to,
the authority to select the employees to participate in the Plan, to determine
what goals, objectives and conditions need to be achieved to earn an award,
whether such goals, objectives and conditions have been met, to determine
whether payment of an award should be made, and to determine whether an award
should be modified or eliminated. The Committee, in its sole
discretion and on such terms and conditions as it may provide, may select one or
more directors and/or officers of FOHG (“Plan Administrators”) to operate the
Plan, perform day-to-day administration of the Plan, and maintain records of the
Plan; provided that no Plan Administrator shall participate in the establishment
of any goal, objective or condition relating to such Plan Administrator nor
shall such Plan Administrator be involved in the approval of any payment of an
award under the Plan to such Plan Administrator. All decisions made
by the Committee and/or any Plan Administrator will be final, conclusive and
binding on all persons, and will be given the maximum deference permitted by
law. If any participant is employed pursuant to an employment
agreement, the terms of such employment agreement shall supersede any
conflicting terms of this Plan.
Eligibility. Participation in
the Plan is limited to select employees as determined by the
Committee. Additional participants may be added to the Plan during a
fiscal year at the discretion of the Committee; provided that the incentive
payment, if any, for such participants shall be pro-rated based on the actual
period during which such individual was a participant in the Plan during the
fiscal year and, provided, further, that no additional participants may be added
during the last quarter of a fiscal year.
Timing of
Payment. Awards (if any)
under the Plan shall be paid as soon as practicable after the end of the fiscal
year during which the award was earned. Awards (if any) shall be made
only to participants employed by FOHG and/or its subsidiaries at the time of the
payout and shall be paid in cash in a single lump sum, net of all required
payroll deductions and taxes. It is intended that this Plan comply
with the requirements of Internal Revenue Code Section 409A so that none of the
payments to be provided hereunder will be subject to the additional tax imposed
under Section 409A, and any ambiguities will be interpreted to so
comply.
Plan
Structure. The Plan provides for payment of annual cash
bonuses (each an “Annual Bonus”) to participants based upon:
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·
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achievement
of individual performance objectives, which shall be approved annually by
the Committee; and
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·
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FOHG’s
annual financial performance, which shall be based upon an evaluation of
Adjusted EBITDA (defined below) against a target adjusted EBITDA approved
annually by the Board (“Target Adjusted EBITDA”). For purposes
of the Plan, Adjusted EBITDA is defined as earnings before interest,
taxes, depreciation, amortization, stock compensation expense, any bonus
awarded hereunder and adjustments for non-recurring items as determined by
the Board.
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Bonus
Potential. The maximum Annual Bonus for each participant shall
be equal to a percentage of the participant’s base salary as determined by the
Committee or in accordance with the employment agreement of the participant, if
any. If any adjustments are made to a participant’s base salary
during the fiscal year, the Committee at its discretion may adjust the
applicable Annual Bonus percentage pro-rata for the remainder of such fiscal
year.
Bonus
Calculation. The percentage of the maximum Annual Bonus that each
participant shall be entitled to under the Plan will be equal to the sum of the
Company Performance Component and the Individual Performance Component, each as
set forth below:
Company Performance
Component
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·
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Up
to 80% of a participant’s maximum Annual Bonus may be paid out to such
participant upon FOHG’s achievement of the percentages of Target Adjusted
EBITDA as described in the following
table:
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Percentage of
Target Adjusted
EBITDA Achieved
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Maximum Percentage of Annual
Bonus(1)
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<100
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% | 0 | % | |||
| 100 | % | 10 | % | |||
| 110 | % | 20 | % | |||
| 120 | % | 40 | % | |||
| 130 | % | 60 | % | |||
| 140 | % | 80 | % | |||
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(1)
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Percentages
will be adjusted pro rata if the percentage of Target Adjusted EBITDA
achieved falls between two grid
percentages.
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Individual Performance
Component
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·
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Up
to 20% of a participant’s maximum Annual Bonus may be paid out upon the
achievement of such participant’s individual performance objectives if
Adjusted EBITDA is 80% or more of Target Adjusted EBITDA for such fiscal
year.
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·
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Individual
performance objectives will be comprised of measurable goals jointly
developed by the participant and his or her immediate supervisor and
approved by the Committee. For a participant to receive at
least a portion of the individual performance component of his or her
Annual Bonus under the Plan, at least 75% of the participant’s individual
performance objectives must be achieved. If such participant
achieves more than 75% of the participant’s individual performance
objectives, the percentage of the individual component of the Annual Bonus
will be determined on a proportional basis up to a maximum of 20% of a
participant’s maximum Annual Bonus. The Committee will have the discretion
to adjust the percentage paid to the individual for the individual
component of the Annual Bonus upward or downward to account for
circumstances that make achievement of any goal easier or more difficult
than anticipated at the time the goal was
established.
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