Exhibit 10.58

 

Caremark Rx, Inc.

Management Incentive Plan (MIP)

Fiscal Year 2006

 

PURPOSE

 

The Caremark Rx, Inc. 2006 Management Incentive Plan’s (the “Plan”) purpose is
to provide an incentive to management level employees of Caremark Rx, Inc. and
its participating subsidiaries (“the Company”) who contribute to the success of
the enterprise. The Plan offers eligible employees an opportunity to earn
compensation in addition to their salaries, based upon performance of the
Company and accomplishment of their Individual/Departmental Goals.

 

PLAN ADMINISTRATION

 

The Compensation Committee of the Board of Directors, in consultation with the
Chief Executive Officer of Caremark Rx, Inc. (CEO), will approve the Plan and
the EVP of Administration and Services will administer the Plan. The EVP,
Administration and Services will oversee and interpret (including the amount
payable to any individual participant) any and all aspects of the Plan. The CEO
of Caremark Rx, Inc. will have final executive approval of both the amount and
the timing of any bonus payments. The Compensation Committee of the Board of
Directors shall review and approve the CEO’s final executive approval.

 

PARTICIPANT ELIGIBILITY

 

Generally, eligible participants would include regular full-time and regular
part-time classified as manager or advisor level and above employees.

 

An employee must be employed or must meet the eligibility criteria above on or
before September 30, 2006, to be eligible to participate in the Plan. If a
person otherwise eligible for participation in the Plan becomes an employee of
Caremark Rx, Inc. or its participating subsidiaries during the fiscal year, the
employee will be eligible to receive a prorated portion of the annual bonus.
Generally, ineligible participants would include:

 

  •   Temporary employees, independent contractors, and consultants.

  •   Anyone eligible to participate in a Sales Incentive Plan.

  •   Anyone eligible to participate in the Quarterly Incentive Plan.

  •   Employees of discontinued operations.

  •   Employees who have not signed at least one of the following documents:
Caremark Employment Agreement, Caremark Employee Non-Competition, Nondisclosure
and Development Agreement, Caremark Employment and Confidentiality Agreement, or
an Employment Contract.

  •   Anyone not actively employed on the date the bonuses are distributed.

  •   Any other employee that does not meet the eligibility criteria above.

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An employee must be an active employee of the Company on the day the bonuses are
distributed to employees to be eligible to receive any payment under the Plan.

 

PLAN YEAR

 

The Plan will be effective from January 1, 2006 through December 31, 2006.

 

BONUS POTENTIAL

 

The target bonus potential is calculated as a percentage of the employee’s
actual fiscal year base earnings. The guidelines for determining target bonus
potential are set forth on Exhibit A attached hereto. These guidelines, however,
may be adjusted to reflect the significance, scope, and level of accountability
for a given position title. Adjustments (increases or reductions) to the target
levels set forth on Exhibit A may be made at the discretion of the CEO of
Caremark Rx, Inc. Additionally, certain executive bonuses are set forth in
written employment agreements that the Board of Directors has approved. As such,
these written agreements shall be controlling.

 

PLAN COMPONENTS

 

The funding and payment of bonuses is based upon two separate plan components.
The two components are Caremark Rx, Inc. Performance Targets and
Individual/Departmental Goals.

 

The plan components work together. The corporation must officially declare the
payment of bonuses before any types of payment under this Plan can or will be
paid. If, and when, bonuses are declared, then calculations will be made using
the two (2) components to determine individual amounts to be paid.

 

  •   Caremark Rx Performance Targets

 

Payments are contingent upon Caremark Rx, Inc. achieving the performance targets
set forth on Exhibit B attached hereto, which are subject to possible
adjustments also as set forth on Exhibit B.

 

The Chairman/CEO of Caremark Rx, Inc. will establish the performance targets in
consultation with the Compensation Committee of the Board of Directors.

 

  •   Individual/Departmental Goals

 

The achievement of Individual and/or Department goals (based on Company
objectives) is a very important component of the Plan. Once the Company has
achieved its performance goals, individual bonus potential can be greatly
impacted by the level of achievement of Individual and/or Department Goals. The
following are examples of measurements that could be utilized:

 

   

•      Budget Management

•      Cost of Service

•      Quality & Service Levels

•      Product Line Achievement

•      Leadership/Team Player

   

 

These measurements are examples only and are not an exclusive list of criteria
to measure performance.

 

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Managers will review each of their MIP eligible employees and will make a
recommendation of 100% to 0% of the bonus amount based on the achievement of
Individual and/or Department Goals. Managers cannot distribute or recommend more
the 100% of an individual employee’s target amount. However, the bonus
recommendation can be reduced or increased at the discretion of the CEO of
Caremark Rx, Inc.

 

TRANSFER/PROMOTION/DEMOTION

 

If an employee is transferred to a new role during the Plan Year, the employee
will be eligible to participate in the incentive plan that applies to the new
role. If the MIP target percentage changes due to movement to a new role, the
bonus payout for that fiscal year will be calculated based on the actual base
earnings the employee received during the fiscal year in each role at the
applicable target percentage(s) for each role. However, if an employee eligible
for participation in the Quarterly Incentive Plan is promoted to a position
eligible for participation in the Management Incentive Plan after September 30th
of the Plan Year, the employee will remain on the Quarterly Incentive Plan
through the end of the Plan Year. The employee will not be eligible to
participate in the Management Incentive Plan until January 1st of the following
year.

 

If the employee becomes ineligible for this incentive plan due to a transfer,
demotion, or promotion, the employee will be eligible to receive a prorated
award based on the period of participation in the Plan. The prorated award will
be paid at the same time as awards under the Plan.

 

PAYOUT AND TAXATION

 

The distribution of bonuses shall be made on or before 03/15/2007, after
completion of audited financial statements for the 2006 fiscal year, and final
executive and Board approval. Specific provisions regarding distribution are
outlined under the Conditions for Receiving Payment section of the Plan.

 

Payroll taxes will be withheld from the bonus award as required by law. Bonus
awards that employees receive are counted as income in the year in which they
are paid. Therefore, the bonus payment for the year ending December 31, 2006,
paid in 2007, is part of an employee’s total income for the 2007 tax year.

 

INTEGRATION WITH BENEFIT PROGRAMS

 

Any bonus award that an employee receives is not considered compensation for
purposes of life insurance, 401(k), disability, or other benefit plans unless
specified by the plan document.

 

CONDITIONS FOR RECEIVING PAYMENT

 

No bonus award will be paid to any employee if employment is terminated, whether
voluntary or involuntary, prior to the actual payment distribution date.
However, the Company retains the authority to make exceptions to the foregoing
policy in unusual or meritorious cases including, but not limited to, the death
of an employee during the fiscal year, termination of employment due to total or
partial disability, call to active military service, or retirement with the
written consent of the Company.

 

LIMITATIONS AND/OR ADJUSTMENTS

 

Bonus compensation under the Plan is not an integral part of an employee’s
compensation package. An employee’s base salary compensates the employee for the
expected results of any given job. Payment of

 

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the bonus compensation is at the discretion of the Company. The Company reserves
the right to review, amend, suspend, and/or terminate the Plan, the incentive
calculation formulas, and all other aspects of the MIP at any time. Plan changes
will be based on a determination of the Company’s business needs, however, do
not require prior notification or explanation to eligible employees.

 

An employee’s participation in the Plan shall not be construed as an employment
contract or as a promise of continuing employment between Caremark and the
employee. Employment with Caremark is terminable at will. Either the employee or
Caremark may terminate the relationship without cause or for any reason at any
time.

 

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