Exhibit 10.8
(HENRY SCHEIN LOGO) [y18197y1819700.gif]
Management Team
2004
Performance Incentive
Plan Summary

 

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1. Introduction
Congratulations on being designated a participant in the Performance Incentive
Plan (“PIP,” or the “Plan”), Henry Schein’s incentive-based cash compensation
program for its management team. Plan participants include the entire management
team of directors and vice presidents. The Plan has been designed to bind all
participants together in a concerted effort to drive our business toward
achieving common objectives that benefit the Company as a whole, the management
team and each participant. The Plan is specifically designed to:

  •   Provide each participating management team member (“Participant”) with an
annual cash bonus opportunity;     •   Foster achievement of specific corporate,
business unit and individual performance goals (“Goals”);     •   Recognize and
reward Participants for individual and group team achievements;

The PIP cash bonus award, in conjunction with a Participant’s base compensation,
is intended to provide Participants with competitive total annual cash
compensation that is at or above the median for comparable positions at
companies in our industry and at other organizations of our size.
This program was reviewed and approved by the Compensation Committee of the
Board of Directors.
2. Eligibility
The Chief Executive Officer (“CEO”) annually determines eligibility for
participation in the Plan. Participation is intended to be ongoing. However,
changes in assignments may result in a Participant’s being ineligible to
participate in the Plan. Team Schein Members will be notified at the beginning
of each year regarding their eligibility to participate in the Plan.
3. PIP Awards
PIP awards are based on:

  •   The Company’s annual profitability, specifically measured against earnings
per share (“EPS”), net income or other predetermined profitability Goals;     •
  The participant’s business unit or functional area’s level of achievement in
financial and other performance goals.     •   The participant’s achievement of
his or her individual goals.

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     4. Individual Performance Goals
A Participant’s individual performance Goals are classified into three
categories:

  •   Company financial performance     •   Functional area financial
performance     •   MBO performance

The Company Financial Performance Goals are based on annual earnings per share
(EPS) achievement. The Functional Financial Performance Goal and the MBO
Performance Goal evaluation and analysis are conducted annually, unless
otherwise specified. The PIP award payouts corresponding to levels of
achievement of Company Financial Performance Goals are set forth on Exhibit A.
The PIP award payouts for meeting or exceeding Functional Area Financial Goals
and each Participant’s individualized MBO Performance Goals are set forth on
Exhibits B and C, respectively.
The CEO and the person to whom the Participant reports (“Manager”) will
determine the Participant’s Goals at the start of each year. There will be an
ongoing review of these goals. Any changes during the year must be approved by
the Manager and, if appropriate, by the CEO. Each Participant and his or her
Manager are encouraged to have performance evaluations during the year to
monitor progress and, if necessary, to modify Goals (with the approval of the
CEO, if appropriate) for the balance of the year.
The following table illustrates performance Goals for different types of
management positions:
Performance Goals Based on Position and Role

                              Range of Performance Goal Categories      
Functional     Company             Financial     Financial         Management
Segment   Performance     Performance     MBO Performance    
Corporate
Management Participants
(e.g. Finance, Supply Chain TSM’s, etc)
    10% - 40 %     15% - 40 %     30% - 50 %
Major Business
Unit Participants
(e.g. Dental Group, Medical Group, Veterinary Group TSM’s, etc.)
    55% - 65 %     15% - 35 %     10% - 25 %
Supporting Corporate Function Participants (e.g. Legal Department, Human
Resources Department TSM’s, etc.)
    10% - 20 %     15% - 35 %     40% - 60 %

Note:   This schedule is intended to provide guidelines for development of a
specific performance plan for each Participant. Final weighting of performance
Goals for each Participant will be determined by the Participant’s Manager and,
if appropriate, approved by the CEO.

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5. Company Financial Performance Goals
The Company net income goal will be set for the entire Management Team based on
the annually set EPS target. The internally developed EPS base Goal is
determined by the Compensation Committee of the Board of Directors with input
from the Executive Management team. The Compensation committee will make
adjustments to the 2004 EPS goal for acquisitions based on information provided
to them by the Executive Management team. Changes to the goal will be provided
to the participants.
See Exhibit A for PIP award payouts for achieving Company Financial Performance
Goals.
6. Functional Area Financial Performance Goals
For Participants managing areas that impact a P&L, these Goals are based on the
business unit’s financial performance measured against annual financial budgets,
in the following areas:

  •   Group/ Divisional gross profit goals.     •   Group/Divisional
contribution dollars.     •   Group/Divisional Pre-Tax income after “service
charges.”     •   Group/Divisional net income Goals.     •   Pre-Tax Income of
operating subsidiaries — sales, gross profit and operating income Goals.

For Participants with infrastructure or supporting responsibilities, these Goals
are based on expense performance relative to the budget and other quantitative
goals versus the budget.
See Exhibit B for PIP award payouts for achieving levels of the Functional Area
Financial Goals.
7. MBO Performance Goals
Specific, measurable MBO Performance Goals will be developed for each
Participant. These MBO Performance Goals should drive toward and support five
enterprise-wide initiatives: Profitability; Process Excellence; Customer
Satisfaction, Strategic Planning, and organizational Development.

q   Profitability — e.g., reduce expenses as a percent of sales; increase
business unit sales; reduce inventory.   q   Process Excellence — e.g.,
implement a new policy; reduce errors to customers; reduce DSO’s; increase
inventory turns.   q   Customer Satisfaction - e.g., increase frequency of
salesperson to customer contacts; implement project to develop computer screens
to aid in positive customer interactions; support internal customer by
completing all recruits within a reasonable predetermined time period; develop
customer feedback program, such as surveys and focus groups.   q   Strategic
Planning - e.g., develop strategic plan based on individual responsibilities;
benchmark Participant’s unit against similar companies’ functions.   q  
Organizational Development - e.g. personal business development, succession
planning, diversity goals, staff development, recruitment goals.

See Exhibit C for PIP award payouts for achieving and exceeding MBO Performance
Goals.

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8. Acquisitions, New Business Ventures
Functional Financial and MBO goals will be adjusted for acquisitions and new
business ventures that were not initially considered when developing the
original Company target. Also, as discussed in the Company Financial Performance
Goals area, the Compensation Committee of the Board of Directors will also make
adjustments to the budgeted EPS for unbudgeted acquisitions.
9. Plan Awards
During the first fiscal quarter of each year, individual performance for the
previous year is evaluated relative to Goals. PIP awards are determined for each
performance category, as applicable. A Participant’s total Plan award will equal
the sum of the awards earned in each category for the previous year’s
performance.
In order to receive any PIP award, Participants must be actively employed on
March 15 of the year the Plan award is to be paid out. A prorated Plan award may
be available, at the discretion of the CEO, if a Participant in the Plan dies,
becomes permanently disabled, retires at the normal retirement age during the
Plan year, or in other special circumstances.
PIP awards, less applicable withholdings, will generally be made by the end of
the first fiscal quarter of each year.
This summary is a general description of the Henry Schein, Inc. Performance
Incentive Plan for the Management Team as of January 1, 2004. This summary is
not intended to, nor does it constitute, a contract or guarantee of continued
employment. The Company reserves the right to change or terminate the Plan at
any time without notice.

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