Exhibit 10.1

 

Annual Executive Incentive Plan

 

Eligibility

 

The Annual Executive Incentive Plan (the “Plan”) applies to the Chief Executive
Officer and other executive officers selected by the Compensation and Benefits
Committee (the “Compensation Committee”).

 

Purpose

 

The Board intends that payments under the Plan will qualify as performance-based
compensation within the meaning of Section 162(m) of the Code. The Plan has been
designed by the Compensation Committee to meet these criteria.

 

Performance Criteria

 

Performance criteria upon which payments under the Plan will be based shall be
measured in terms of one or more of the following objectives, described as they
relate to Company-wide objectives or of a subsidiary, division, department or
function of the Company: earnings per share, stock price, shareholder return,
return on investment, return on capital, earnings before interest, taxes,
depreciation and amortization, gross or net profits, gross or net revenues,
market share, sales, costs, client retention or attraction, or any combination
of the foregoing. Maintaining the status quo or limiting economic losses can be
appropriate goals.

 

In computing any of the foregoing, unless determined otherwise by the
Compensation Committee in respect of any particular performance criteria no
later than the time that such performance criteria is established, there shall
be an adjustment to reflect, to the extent applicable, (i) the cumulative
effects of changes in generally accepted accounting principles, (ii) gains and
losses from discontinued operations, (iii) extraordinary gains and losses and
(iv) any other unusual or nonrecurring gains or losses that are separately
identified in the Company’s financial statements, including merger-related
charges.

 

Each year the Compensation Committee shall specify the performance criteria to
be achieved, a minimum acceptable level of achievement below which no payment
will occur, and a formula for determining the amount of any payment to occur if
performance is at or above the minimum acceptable level but falls short of full
achievement of the specified performance criteria.

 

If the Compensation Committee determines that a change in the business,
operations, corporate structure or capital structure of the Company, or the
manner in which it conducts its business, or other events or circumstances
render the performance criteria to be unsuitable, the Compensation Committee may
modify such performance criteria or the related minimum acceptable level of
achievement, in whole or in part, as the Compensation Committee deems
appropriate and equitable; provided, however, that no such modification shall be
made if the effect would be to cause a payment under the Plan to fail to qualify
for the performance-based compensation exception to Section 162(m) of the Code.
In addition, at the time performance criteria are established, the Compensation
Committee is authorized to determine the manner in which the performance
criteria will be calculated or measured to take into account certain factors
over which the participant has no control or limited control including changes
in industry margins, general economic conditions, interest rate movements and
changes in accounting principles.

 

Amount of Payment

 

The Compensation Committee, based upon information to be supplied by management
of the Company, will establish for each year, a target bonus amount and
performance criteria for each eligible executive and communicate such amount and
criteria in writing to such eligible executive prior to or within the first 90
days of the year for which such bonus may be paid. Bonuses will be earned by
eligible executives based upon the level of attainment of the applicable
performance criteria during the applicable year; provided that the Compensation
Committee may reduce the amount of any target bonus in its sole and absolute
discretion. Notwithstanding any other provision of

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the Plan to the contrary, the maximum amount of any bonus award payable to any
one executive under the Plan for any year shall be $2,000,000. The Black-Scholes
method will be used in determining the value of any portion of an award paid in
the form of stock options. As soon as practicable after the end of the
applicable year, the Compensation Committee shall determine and certify the
level of attainment of the performance criteria for each eligible executive and
the bonus to be paid to each eligible executive.

 

Form and Timing of Payment

 

Awards may be paid in the form of cash, stock options or other awards authorized
under the 1998 Long Term Incentive Plan, or a combination thereof. Awards shall
be paid as soon as practicable following the end of the year, unless payment is
deferred at the election of the eligible executive pursuant to a deferred
compensation arrangement maintained by the Company.

 

Administration

 

The Plan is administered by the Compensation Committee, which is composed solely
of three or more independent directors who are not eligible to participate in
the Plan.

 

Amendment

 

The Board may amend or terminate the Plan at any time. However, no amendment
shall increase the maximum award to an eligible executive without the consent of
shareholders.