Exhibit 10.24
XenoPort, Inc. Corporate Bonus Plan
Adopted January 30, 2007
Effective January 1, 2007
Plan Objectives
     The objectives of the Corporate Bonus Plan (the “Plan”) are to:

  •   provide certain employees of XenoPort, Inc. (the “Company”) with
incentives to achieve the highest level of individual and team performance and
to meet or exceed specified goals, which contribute to the overall success of
the Company;     •   motivate participants to achieve both individual and
Company objectives; and     •   enable the Company to attract and retain
high-quality employees.

Administration
The Plan will be administered by the Compensation Committee of the Company’s
Board of Directors (the “Compensation Committee”) and the Chief Executive
Officer. The Compensation Committee generally sets a one-year performance period
under the Plan to run from January 1 through December 31. The Compensation
Committee is responsible for approving any incentive compensation for executive
officers (as that term is defined in Section 16 of the Securities Exchange Act
of 1934, as amended, the Company’s “Executive Officers”) and for recommending to
the Company’s Board of Directors (the “Board”) the incentive compensation for
the Chief Executive Officer. The Chief Executive Officer is responsible for any
incentive compensation for employees who are not Executive Officers (i.e.,
positions below the level of Senior Vice President, the Company’s “Non-Executive
Officer Employees”) in accordance with the approved annual budgets.
Eligibility
All Company employees holding a position with the Company that is covered by
this Plan as determined by the Compensation Committee from time to time in its
discretion are eligible to participate in the Plan for each performance year;
provided, however, that, unless otherwise provided by the Compensation
Committee, in order to receive their awards, if any, eligible employees
(“Participants”) must: (i) be employed by the Company on the last day of the
Plan’s performance year and at the time awards are paid out under the Plan;
(ii) have completed at least six months of full-time, active service with the
Company during the Plan performance year period (active service excludes all
time while the Participant is on any leave of absence) or have been deemed by
the Compensation Committee to be eligible to participate fully in the Plan; and
(iii) not have been placed on a written performance improvement plan at any time
during the Plan performance year period.
Participants with at least six, but less than 12, months of active service
during the performance year period may be eligible for a prorated bonus,
depending on their length of service that year. A Participant who changes job
grades during the performance year may be eligible for a bonus based on the
length of time in each grade and the respective bonus targets that would apply.
Unless the terms of an applicable severance plan provide otherwise, a
Participant who terminates employment (or gives notice of his or her intent to
terminate) for reasons other than death or disability prior to a payout date of
an award under the Plan will not be eligible for a bonus award. If an employee
dies prior to a payout date of an award under this Plan, then the award that the
employee otherwise would have been eligible to receive under the Plan, if any,
may be paid to his/her estate at the discretion of the Company.

 

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Target Bonus Awards
Target bonus awards are determined and communicated to eligible employees
annually. The Chief Executive Officer determines target bonus awards for
Non-Executive Officer Employees, and the Compensation Committee determines
(subject to approval by the Board) target bonus awards for all Executive
Officers, including the Chief Executive Officer. Target bonus awards may be
modified from time to time.
Award Determination
Actual bonus payouts can range from 0 to 1.5 times the target bonus awards,
based on individual and Company performance.
Following are the weightings of the individual and Company performance
components used for Participants in determining the actual bonus award amounts:

                      Weighting of Company’s         Performance Against  
Weighting of Individual Title   Corporate Goals   Performance      
Chief Executive Officer
    75 %     25 %
President
    65 %     35 %
Senior Vice President
    50 %     50 %
Vice President
    50 %     50 %
Below Vice President
    40 %     60 %

At the beginning of each performance year period under the Plan, the criteria
for assessing an individual’s performance will be developed by the Company in
consultation with the Participant (“Individual Bonus Criteria”). For
Non-Executive Officer Employees, the Individual Bonus Criteria for such
Participants must be approved by the Chief Executive Officer. For Executive
Officers (other than the Chief Executive Officer) the Individual Bonus Criteria
for such Participants must be approved by the Compensation Committee, in
consultation with the Chief Executive Officer. For the Chief Executive Officer,
the Individual Bonus Criteria for such Participants must be approved by the
Compensation Committee and the Board.
After the end of each Plan year, individual performance will be evaluated based
on achievement of weighted goals and objectives as reflected in the employee’s
written performance objectives for the year. For Non-Executive Officer
Employees, the Chief Executive Officer will assess the extent to which
Individual Bonus Criteria have been met, identify any unplanned achievements
that have been accomplished and approve an overall percentage of weighted goals
achieved with respect to the individual component of the Plan. For Executive
Officers (other than the Chief Executive Officer), the Compensation Committee
will assess, in consultation with the Chief Executive Officer, the extent to
which Individual Bonus Criteria have been met, identify any unplanned
achievements that have been accomplished and approve an overall percentage of
weighted goals achieved with respect to the individual component of the Plan.
For the Chief Executive Officer, the Compensation Committee will assess the
extent to which Individual Bonus Criteria have been met, identify any unplanned
achievements that have been accomplished and recommend to the Board for approval
an overall percentage of weighted goals achieved with respect to the individual
component of the Plan.
At the beginning of each performance year period under the Plan, the criteria
for assessing the Company’s corporate performance will be: (i) developed by the
Chief Executive Officer of the Company in consultation with management;
(ii) reviewed and approved by the Compensation Committee; and (iii) approved by
the Board.
After the end of each Plan year, the Compensation Committee will assess the
extent to which corporate goals and objectives have been met, identify any
unplanned achievements that have been accomplished and recommend to the Board
for approval an overall percentage of weighted goals achieved with respect to
the

 

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corporate component of the Plan. This percentage of corporate goal achievement,
together with the percentage of achievement for the individual component, will
be used to calculate bonus payouts for individuals who participate in the Plan.
The Company must achieve at least 70% of the Company’s weighted corporate
objectives in order for any bonus award payouts to occur. The Compensation
Committee and the Board have discretion in determining whether such threshold
has been achieved. In addition, the Compensation Committee, in its discretion,
may determine to grant an award under the Plan even though certain Individual
Bonus Criteria or corporate objectives are not met.
Awards under the Plan are subject to applicable withholdings. Employees who have
elected to participate in XenoPort’s Employee Stock Purchase Plan and/or 401(k)
Plan will have the applicable funds withheld from their bonus payment.
Other Provisions
The Company reserves the right to interpret, modify, suspend or terminate this
Plan at any time.
No Participant will have the right to alienate, assign, encumber, hypothecate or
pledge his or her interest in any award under the Plan, voluntarily or
involuntarily, and any attempt to so dispose of any such interest will be void.
Participants who engage in an activity that violates applicable local, state or
federal laws, or who violate Company policies, may be subject to having their
awards reduced or eliminated in the sole discretion of the Compensation
Committee, except in the case of the Chief Executive Officer where the Board
shall make the final determination after considering the Compensation
Committee’s recommendation.
Neither this Plan nor any action taken hereunder shall be construed as giving
any employee or Participant the right to be retained in the employ of the
Company. Employees of the Company are employed “at will” unless they have an
agreement signed by the Chief Executive Officer or a member of the Board
providing for other than at-will employment.
The provisions contained in this Plan set forth the entire understanding of the
Company with respect to the Plan and supercede any and all prior communications
between the Company and any employee with respect to the Plan.