Exhibit 10.1

SCHEDULE

LSI Non-Employee Director Compensation

I.                                         Annual Cash Compensation

Annual cash retainers (to be paid in quarterly installments), plus out-of-pocket
expenses as outlined in the table below.  The initial payment of this cash
compensation shall be made upon the first meeting of the Board of Directors held
after completion of the proposed initial public offering of the Corporation.  In
addition, each year, directors may elect to receive all of their annual cash
payments in the form of stock option grants. To make such election, directors
shall deliver an irrevocable, written notice thereof to the Corporation’s
Secretary between September 1st and September 30th of the fiscal year
immediately prior to the year for which the director wishes to make the
election. The grant date shall be the first day of the fiscal year for which the
election is made. These stock options will have a one year vesting period, such
that 100% of the options will vest on the one year anniversary of the grant
date.  The exercise price shall be, in accordance with the terms of the
Corporation’s 2006 Long Term Omnibus Incentive Plan, the closing price of the
Corporation’s common stock on the first day of the fiscal year for which the
election is made (or if the Nasdaq National Market is closed for trading on such
day, then the closing price on the next day on which the Nasdaq National Market
is open for trading). The determination of the number of stock options each
director is entitled to receive shall be made as of the first day of the fiscal
year for which the director wishes to make the election.  The Corporation shall
use the valuation method described below in Section II, Annual Equity
Compensation, under the heading, “Black-Scholes Option Valuation,” to determine
the number of options directors would be entitled to receive in lieu of their
respective cash payments. Such valuation method shall be used solely for the
purpose of determining the number of options each director shall be entitled to
receive.

 

 

 

Cash Amount

 

Annual Retainer

 

$

25,000

 

Annual Audit Committee Chairman

 

$

10,000

 

Annual Compensation Committee Chairman

 

$

5,000

 

Annual Nominating/Governance Committee Chairman

 

$

5,000

 

 

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SCHEDULE 1 (cont.)

II.                                     Annual Equity Compensation

Annual equity compensation valued at approximately $34,000 per annum as
determined in accordance with Black Scholes standard valuation of option grants
(see table below for an example of a valuation calculation).  These options will
have a ten year exercise period and shall vest corresponding to the period of
service.

Black-Scholes Option Valuation

Black-Scholes Option Valuation

 

 

 

Market Price

 

$

12.8900

 

Exercise Price

 

$

12.8900

 

Annual Volatility

 

41.1000

%(a)

Risk-Free Rate

 

4.6600

%

Dividend

 

0.0000

%

Expected Life (years)

 

2.0000

(b)

Black-Scholes

 

$

3.4249

 

Number of Options

 

20,000

 

Total Value

 

$

68,498

 

Amortization Period (Yrs)

 

2

 

Value Per Year

 

34,249

 

Notes:

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(a)             Source: Bloomberg

(b)            Expected timeframe under which options will be exercised.

(c)             Assumes expected life of two years.

d1

 

0.450967

d2

 

(0.130275)

N(d1)

 

0.673993

N(d2)

 

0.448175

Formulas

 

 

d1

 

=(LOG(B2/B3)+((B5-B6)+(B4*B4)/2)*B7)/(B4*SQRT(B7))

d2

 

+D3-B4*SQRT(B7)

N(d1)

 

=NORMDIST(D3,0,1,1)

N(d2)

 

=NORMDIST(D4,0,1,1)

BSValue

 

=B2*EXP(-B6*B7)*D5-B3*EXP(-B5*B7)*D6

 

 

 

 

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