Exhibit 10.51
Performance Goals
and Bonus Formula for Fiscal Year 2006
under the Senior Executive Bonus Plan
On January 24, 2006, the Human Resources and Compensation Committee (the
“Committee”) of the Board of Directors of Applied Materials, Inc. (“Applied”)
approved the performance goals and a bonus formula under Applied’s Senior
Executive Bonus Plan (the “Plan”) that will be used to calculate bonus awards
for Applied’s most senior executive officers for fiscal year 2006.
As set forth in the Plan document that was approved by Applied’s stockholders at
the 2002 Annual Meeting of Stockholders, the Committee may choose from a range
of specified and defined performance measures in setting the performance goals.
For Michael R. Splinter, President and Chief Executive Officer; Franz Janker,
Executive Vice President, Sales and Marketing; and Nancy H. Handel, Senior Vice
President, Chief Financial Officer, the Committee chose three primary measures:
Applied’s earnings per share, Applied’s relative annual revenue growth, and
certain strategic goals, which include entry into new markets, extension of
Applied’s leadership, and strong operational and financial performance.
For Farhad Moghadam, Senior Vice President, General Manager Thin Films Product
Business Group and Foundation Engineering; Thomas St. Dennis, Senior Vice
President, General Manager Etch and Front End Products Business Group; and Mark
R. Pinto, Senior Vice President, Chief Technology Officer and General Manager
New Business and New Products Group, the Committee chose three primary measures:
Applied’s earnings per share, financial and operational objectives for each
officer’s respective business units, and certain strategic goals that are
similar or the same as described above. Depending on the respective business
units for which each officer has responsibility, the financial and operational
objectives relate to business unit revenue, profits, quality and reliability,
efficiency, product development, customer satisfaction, technological innovation
and leadership and human resources.
Even if the goals described above are achieved, no bonus will be paid under the
Plan unless Applied achieves a specified level of profit after tax. If a bonus
does become payable under the formula, the bonus may be increased if Applied’s
total stockholder return for the year is positive and exceeds the total
stockholder return for a diversified group of other large capitalization
companies. However, a bonus first must be earned under the applicable bonus
formula. No bonus will be payable solely on account of total stockholder return
performance. The bonus to Michael R. Splinter under the Plan will range from
zero to 450% of his annual base salary. The bonus for the other executive
officers named above will range from zero to 375% of annual base salary,
depending on

 

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the officer. For all of the officers, the maximum bonus will be payable only if
actual performance significantly exceeds all targeted goals and total
stockholder return is extremely high compared to the other specified large
companies.
The actual bonuses paid (if any) will vary depending on the extent to which
actual performance meets, exceeds or falls short of the goals described above.
Extraordinary, non-recurring items generally will be excluded when determining
actual performance, unless otherwise determined by the Committee during its
regular review of actual performance versus the specified goals. In addition,
the Committee retains discretion to reduce or eliminate (but not increase) the
bonus that otherwise would be payable under the Plan based on actual
performance. An executive must remain an employee for all of fiscal year 2006 in
order to be eligible for any bonus under the Plan.