EXHIBIT 10Q

Summary of Cognex Corporation Annual Bonus Program

Cognex Corporation (the “Company”) maintains a performance-based annual bonus
program (the “Bonus Program”) for employees (including the Company’s executive
officers), other than those employees on a sales commission plan. Each
participant in the Bonus Program is assigned a target annual cash bonus.
Participants may earn their bonuses based on the achievement of certain
financial goals set forth in the Company’s annual budget related to budgeted
non-GAAP consolidated operating income as a percentage of revenue (“operating
margin”).
Once the operating margin criterion is met, the amount each employee at director
level and above (which includes the Company’s executive officers) receives
depends upon the achievement of individual performance goals, which are
established annually. Once the minimum level of operating margin has been
achieved, each employee’s eligible bonus is calculated as follows:
•
if the actual operating margin is above the minimum level but below the
operating margin target in the annual budget, each employee is eligible to
receive a pro-rata portion of his or her target bonus;

•
if the actual operating margin is equal to the operating margin target in the
annual budget, each employee is eligible to receive 100% of his or her target
bonus; and

•
if the actual operating margin is above the operating margin target in the
annual budget, all “exempt” employees are eligible to receive an additional
amount depending upon his or her grade level up to a maximum level approved by
the Compensation/Stock Option Committee.

The Compensation/Stock Option Committee approves the target bonus for each
employee at vice president level and above (which includes the Company’s
executive officers), and the amount by which each individual can participate in
any increase due to Company performance in excess of the operating margin
target. The target bonus amount is based upon a percentage of base salary with
the percentage based upon the individual’s level of responsibility. Individual
performance goals are established annually and generally relate to near-term
strategic, financial and operational performance that supports the Company’s
business objectives.