exhibit104.htm


     
EXHIBIT 10.4


    SUNPOWER
CORPORATION

    KEY
EMPLOYEE QUARTERLY

    KEY
INITIATIVE BONUS PLAN

    (Amended and Restated April 3, 2009)

    


    


    Article 1 - KI Plan
Objective

    


    
      	
               
      

            	
              1.1
      The objective of this Key Employee Quarterly Key Initiative Bonus Plan
      (“KI Plan”) is to provide incentives to key employees of SunPower
      Corporation and its subsidiaries (collectively, the “Company”) based on
      the Company’s quarterly corporate milestones and an individual's
      performance against set individual key initiatives (KIs).  The
      KI Plan shall be administered by the Compensation Committee appointed by
      the Board of Directors of SunPower
Corporation.

            


    

    


    Article 2 - Effective
Date

    


    
      	
               
      

            	
              2.1
      This quarterly program will be effective as of January 1,
      2009.  ”Plan Periods” under the KI Plan will correspond to the
      fiscal quarters of the Company.

            


    

    


    Article 3 - Eligibility for
KI Plan Participation

    


    3.1 All
executive officers of the Company, as well as any other key employees approved
by the

         Chief
Executive Officer of the Company shall participate in the KI Plan.

    


    Article 4 - Target Bonus
Percentages and Calculations

    


    
      	
              4.1  

            	
              KI Target Bonus
      Percentages.  Each KI Plan participant will be allocated
      a KI target bonus expressed as a percentage of his or her base
      salary.  KI target bonus percentages are set by the Compensation
      Committee.  The Compensation Committee may, in its discretion,
      set maximum caps on the payout amount for KI bonuses.  The
      Compensation Committee may delegate establishing KI target bonus
      percentages to officers of the Company; provided that executive officer KI
      target bonus percentages must be approved by the Compensation
      Committee.

            


    

    


    
      	
               
      

            	
              4.2  KI Plan
      Components.

            


    

    


    
      	
               
      

            	
              (i)

            	
              Quarterly KI
      Score.  At the start of each quarter the participant will
      formulate with his or her supervisor a list of key initiatives for such
      quarter.  Each initiative will be allocated a certain number of
      points, and the quarterly scorecard shall total 100
      points.  Following each quarter the participant’s supervisor
      will score the participant’s achievement of key initiatives (expressed as
      a percentage).

            


    

    


    
      	
               
      

            	
              (ii)

            	
              Company Milestone
      Score.  With respect to each quarter the Board of
      Directors will establish quarterly corporate milestones for such
      quarter.  Each company milestone will be allocated a certain
      number of points.  Following each quarter, the executive
      officers of the Company will score the achievement of company milestones
      (expressed as a percentage).

            


    

    


    
      	
               
      

            	
              (iii)PBT
      Score.  At the start of each quarter the executive
      officers will establish an internal profit before tax financial target for
      the Company (“Plan PBT”).  Following each quarter the actual
      profit before tax for such quarter will be determined (“Actual
      PBT”).

            


    

    


    4.3    Quarterly
bonuses under this KI Plan are based on a combination of (a) the participant’s
number of points achieved on his or her key initiative scorecard for the quarter
(expressed as a percentage), (b) the percentage of company milestones achieved
for the quarter, and (c) the Actual PBT for such quarter.  In
particular, the bonus payout is calculated as follows:

    


    
      	
              (i)  

            	
              If
      the Actual PBT is less than 90% of the Plan PBT, no KI bonus payout will
      be made for the quarter.

            


    

    


    
      	
              (ii)  

            	
              If
      the Actual PBT is equal to or greater than 90% of the Plan PBT, but the
      company milestone score is equal to or less than 60%, no KI bonus payout
      will be made for the quarter.

            


    

    


    
      	
              (iii)  

            	
              If
      both the Actual PBT is equal to or greater than 90% AND the company
      milestone score is greater than 60%, the quarterly KI bonus will be paid
      as follows:

            


    

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    a. Corporate Milestone Score
greater than 80%:  Full KI score payout.  For
example, if an individual has a $100,000 base salary, 20% KI target bonus and a
KI score of 80%, s/he would receive a quarterly bonus of 100,000 x .20 x .80 =
$16,000.

    


    b. Company Milestone Score less
than or equal to 80%:   One-half KI score
payout.  In the above example, the individual would receive a
quarterly bonus of $8,000.

    


    
      	
              (iv)  

            	
              If
      both the Actual PBT is equal to or greater than 90% and the company
      milestone score is greater than 100%, the quarterly KI bonus may be
      prorated and paid above 100%, subject to a maximum cap of
      110%.

            


    

    


    Article 5 - Effect of Base
Salary on Target Bonus Adjustments.

    


    
      	
              5.1  

            	
              Payout
      calculations under the KI Plan will be based on the plan participant's
      base salary at the end of the quarter being measured and not the base
      salary at the time the milestone and KI portion of the bonus is
      paid.

            


    

    


    
      	
              5.2  

            	
              In
      the event a participant’s KI target bonus percentage is changed during the
      quarter, the new KI target bonus will be effective at the beginning of the
      immediately following quarter.  The participant’s KI payout for
      the current quarter shall be based on the KI target bonus in effect at the
      beginning of that quarter.

            


    

    


    


    Article 6 -  KI
Achievement

    


    
      	
               
      

            	
              6.1  KI
      attainment for the completed quarter and proposed KI for the next quarter
      are reviewed at the end of each quarter no later than the third Friday of
      the first month of the quarter.

            


    

    


    
      	
              6.2  

            	
              In
      setting KIs, a 0% threshold may be defined for each KI.  This
      threshold, which could be timing and/or deliverable-based, is a point at
      which a KI score starts to be earned.  If a participant does not
      reach/complete the minimum threshold, such KI will be scored 0%
      (zero).  Progress beyond the threshold earns the participant a
      pro-rated score up to 110%.  The score for a particular KI item
      cannot exceed 110%.  Scoring greater than 100% for a KI item is
      usually limited to numeric or quantitative
  goals.

            


    

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
               
      

            	
              6.3
      The Chief Executive Officer’s quarterly KI score is the actual corporate
      milestone score for such quarter.

            


    

    


    Article 7
-  Eligibility for Payment

    


    
      	
               
      

            	
              7.1
      Employment:  To
      be eligible for any portion of the bonus payment, the participant must be
      employed by the Company at the scheduled payment date.  A
      participant who terminates employment prior to the payment date will be
      ineligible for any and all bonuses not yet paid, except as otherwise
      provided in this article or any separate agreement approved by the
      Compensation Committee.

            


    

    


    
      	
               
      

            	
              7.2  New
      Hires:  New Hires shall be eligible to participate in the
      bonus program starting the first of the month following the month of
      hire.

            


    

    


    
      	
               
      

            	
              7.3
      Disability:  If
      a participant is unable to perform the essential functions of his or her
      job with or without a reasonable accommodation and is eligible to receive
      disability benefits under the standards used by the Company's disability
      benefit plan, the participant will receive a bonus calculated as follows:
      the quarter in which the disability begins will be considered a completed
      quarter and the KI bonus for that quarter will be paid as though KI
      attainment was 100%.

            


    

    


    
      	
               
      

            	
              7.4
      Retirement:  If
      a participant retires, i.e. permanent termination of employment with the
      Company in accordance with the Company's retirement policies, the
      participant will receive a bonus calculated as follows: the quarter in
      which the retirement begins will be considered a completed quarter and the
      KI bonus for that quarter will be paid as though KI attainment was
      100%.  Thereafter, quarterly participation
    ceases.

            


    

    


    
      	
               
      

            	
              7.5
      Death:  If
      a participant dies, awards will be paid to the beneficiary designated by
      the participant or, if no such designation has been made, to the persons
      entitled thereto as determined by a court of competent
      jurisdiction.  The bonus will be calculated as
      follows:  the quarter in which death occurred will be considered
      a completed quarter and the KI bonus for that quarter will be paid as
      though KI attainment was 100%.  Thereafter, quarterly
      participation ceases.

            


    

    


    
      	
               
      

            	
              7.6
      Lay-off:  If
      a participant is terminated by lay-off during a Plan Period, the quarter
      in which the lay-off occurred will be considered a completed quarter and
      the KI bonus for that quarter will be paid as though KI attainment was
      100%.  Thereafter, quarterly participation
    ceases.

            


    

    


    7.7  No
bonus will be paid to employees who are terminated for cause.

    


    
      	
               
      

            	
              7.8  All
      qualified bonus payments including future scheduled payments pursuant to
      Section’s 7.3, 7.4, and 7.5 will be paid in
  lump-sum.

            


    

    


    
      	
               
      

            	
              7.9
      The Chief Executive Officer reserves the right to reduce the bonus award
      of a participant on a pro-rata basis to reflect a participant's leave of
      absence during the applicable Plan
Period.

            


    

    


    


    Article 8 -
Miscellaneous

    


    
      	
               
      

            	
              8.1
      Unless as defined in article 8.4, no right or interest in this KI Plan is
      transferable or assignable except by will or laws of descent and
      distribution.

            


    

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      	
               
      

            	
              8.2
      Participation in this KI Plan does not guarantee any right to continued
      employment with the Company.

            


    

    


    
      	
               
      

            	
              8.3
      Participation in the KI Plan in a particular Plan Period is not a
      guarantee to participate in subsequent Plan
  Periods.

            


    

    


    
      	
               
      

            	
              8.4
      Management reserves the right to discontinue participation of any
      participant in this KI Plan, at any time, and for whatever
      reasons.

            


    

    


    
      	
               
      

            	
              8.5 This KI Plan is
      unfunded and the Company does not intend to set up a sinking
      fund.  Consequently, payments arising out of bonus earned
      shall be paid out of the Company's general assets.  Each actual
      KI bonus shall be paid in cash (or its equivalent value in shares as
      determined by the Committee or its designee) in a single lump
      sum.  Accounts recognized by the Company for book purposes are
      not an indication of funds set aside for payment.  KI Plan
      participants are considered as general creditors of the Company and
      the obligation of the Company is purely contractual and is not secured by
      any particular Company
asset.

            


    

    


    
      	
               
      

            	
              8.6
      The provision of this KI Plan shall not limit the ability of the
      Compensation Committee (or its designees) to modify said KI Plan, or adopt
      such other plans on matters of compensation, bonus or incentive, which in
      its own judgment it deems proper, at any
time.