Executive Bonus Plan for 2004



 Exhibit 10.11 
  
 FY2004 NEBS Executive Bonus Plan 
  
 (Effective as of July 1, 2003) 
  

	I.	 	Purpose 

  
 The Executive Bonus Plan is designed to motivate and reward executives based on the achievement of targeted financial results thereby furthering the growth and profitability of the Company, as well as supporting other
strategic objectives. The plan is further intended to provide compensation that is commensurate with the attainment of the Company’s objectives and provides compensation that is competitive in the marketplace and serves to attract and retain
talented executives. 
  

	II.	 	Participants 

  
 The participants in the Plan for the 2004 fiscal year of the Company (the “Year”) and their respective target bonus percentages will be as follows: 
  

	 Officers of the Company:

	  	 	 
	 Chairman and Chief Executive Officer
	  	70	%
		
	 President and Chief Operating Officer
	  	70	%
		
	 Executive Vice President, Chief Financial Officer and Treasurer
	  	60	%
		
	 Senior Vice President and President, Distributor Sales
	  	60	%
		
	 Senior Vice President and President, NEBS Direct Marketing
	  	60	%
		
	 Senior Vice President and President, Safeguard Business Systems
	  	60	%
		
	 Senior Vice President and President, PremiumWear
	  	60	%
		
	 Senior Vice President and President, Integrated Marketing Services
	  	60	%
		
	 Senior Vice President, Information Systems
	  	60	%
		
	 Senior Vice President, Human Resources
	  	60	%
		
	 Senior Vice President, Manufacturing and Technical Operations
	  	60	%
		
	 Vice President, Business Management and Development
	  	60	%
		
	 Vice President, Corporate Controller
	  	50	%
		
	 Vice President, General Counsel and Secretary
	  	50	%
		
	 CEOs and Presidents of Subsidiaries:

	  	 	 
	 President and Chief Executive, NEBS Business Products, Ltd.
	  	40	%
		
	 President, Chiswick
	  	40	%









	III.	 	Target Bonus Award 

  
 The target bonus award for each participant is the amount arrived at by multiplying his or her annual base salary at the end of the Year by his or her target bonus percentage. 
  

	IV.	 	Actual Bonus Award Calculation 

  
 The actual bonus for each participant will be calculated based on the actual results vs. targeted objectives. These objectives include one or more Corporate financial
measures in combination with appropriate Channel financial measures and individual qualitative objectives. Each objective is weighted according to its determined relative contribution toward the attainment of the Company’s overall business
objectives, and is expressed as a percentage of the bonus target. 
  
 No bonus
shall be paid under any category if the Company’s pre-tax, pre-bonus income for the Year is less than 80% of the targeted pre-tax, pre-bonus income target, unless, in the judgement of the Organization & Compensation Committee, prevailing
business and global economic conditions and/or the performance of certain business units warrant consideration. 
  

	 	A.	 	Awards for Corporate consolidated net sales and for Channel net sales will commence when a threshold of 90% of the targeted objective is achieved, at which point half of the
targeted award for that objective will be earned. The amount of the award will increase in direct proportion to the sales achievement until 100% of the sales objective is achieved, at which point 100% of the targeted award for that objective will be
earned. Awards for achievement above the targeted objective will increase in direct proportion to sales achievement until achievement reaches 110% of target, at which point 150% of the targeted award will be earned. 

  

	 	B.	 	Awards for Corporate consolidated pre-tax, pre-bonus (PT, PB) income and for Channel Profit from Operations (PFO) will commence when a threshold of 80% of the targeted objective is
achieved, at which point 25% of the targeted award for that objective will be earned. The amount of the award will increase in direct proportion to the income achievement until 90% of the income objective is achieved, at which point 50% of the
targeted award for that objective will be earned. The amount of the award will further increase in direct proportion to the income achievement until 100% of the income objective is achieved, at which point 100% of the targeted income award will be
earned. Awards for achievement above the targeted objective will increase in direct proportion to income achievement until achievement reaches 120% of target, at which point 150% of the targeted award will be earned. 

  

	 	C.	 	For participants who have a Channel PFO objective, if Channel PFO fails to attain at least 80% of targeted achievement, there will be no award for the achievement of Channel net
sales achievement or for Corporate consolidated pre-tax, pre-bonus income. Awards for individual objectives, however, may be earned. 

  

	 	D.	 	The percentage awarded for the achievement of certain personal objectives will commence when Corporate Consolidated pre-tax, pre-bonus income reaches 80% of the PT/PB target, with
an award not greater than 50% of the targeted award. Once 90% of the PT/PB target is attained, the percentage awarded may not exceed the percentage awarded for PT/PB income, and may not exceed 100% of the target award for each personal objective.










	V.	 	Bonus Payments 

  

	 	A.	 	Seventy-five percent (75%) of the gross payment will be in the form of cash; 25% of the gross payment will be in the form of NEBS stock with a share price which is established at
the close of trading on the New York Stock Exchange on the third business day following the issuance of the press release disclosing the Company’s financial results for the fourth quarter of the Year. Cash awards will be made within 60 days
after the close of the Year. Stock awarded pursuant to the NEBS 2002 Equity Incentive Plan will be in the form of Restricted Stock with terms and conditions detailed in the form of a Restricted Stock Award Agreement. 

  

	 	B.	 	At their option and the authorization of the Chief Executive Officer, participants, other than the Chief Executive officer and the four next most highly compensated executive
officers, may receive their bonus entirely in cash if the payment earned is less the 25% of annualized base salary. 

  

	VI.	 	Certain Definitions and Other Provisions 

  

	 	A.	 	All references to “net” sales shall refer to consolidated net sales of the Company or net sales of the distribution channel or a business unit, as the case may be, as
reported or used in calculating the Company’s audited consolidated earnings. 

  

	 	B.	 	For purposes of calculating the actual bonuses, pre-tax, pre-bonus earnings for the Year shall mean such earnings, before taxes and before provision for executive bonuses under this
plan, determined in accordance with all of the accounting policies employed in the preparation of the Company’s audited financial statements for the Year. 

  

	 	C.	 	Actual or targeted pre-tax, pre-bonus income; actual or targeted consolidated sales; actual or targeted profit from operations of any business unit or distribution channel; or
actual or targeted net sales of any business unit or distribution channel may, at the discretion of the Organization and Compensation Committee, be adjusted to eliminate the effect of (a) either the acquisition or the divestiture by the Company of
any subsidiary or division during the Year, and/or (b) the imposition during the Year by Massachusetts or any other state or states of sales taxes on services, materials or supplies purchased by the Company or any subsidiary of the Company the
effect of which is not allowed for in the Company’s annual budget for the 2004 fiscal year or (c) any abatement of taxes or material increase or decrease in Federal or State corporate tax rates. It is the intention of the Organization and
Compensation Committee that any such discretionary adjustment shall be made by it, and shall be announced to the affected participants, promptly after the occurrence of the motivating event, but failure to act promptly shall not deprive the
Committee of its power to make such an adjustment at a later date. 

  

	 	D.	 	Should a participant die, retire, or become totally disabled during the Year, he/she or his/her estate shall be entitled to receive a cash bonus prorated in accordance with the
percentage of his/her annual salary earned from the beginning of the Year up to the date of death, retirement or disability. Should a participant’s employment by the Company or a subsidiary business unit be terminated for any other reason,
payment of any bonus hereunder for the Year in which such termination occurs is at the sole discretion of the Organization and Compensation Committee. 

  

	 	E.	 	If a participant assumes a new position during the Year, the Organization and Compensation Committee may make an appropriate adjustment in his target bonus and/or the means of
calculating his actual bonus, effective from and after that event. 









	 	F.	 	If a Change of Control event (as defined in Paragraph J below) occurs, the Company will within sixty (60) days following such event pay each participant a prorated bonus through the
date thereof as hereinafter provided, whereupon this Plan will terminate. The portion of the bonus based on factors other than personal objectives shall be calculated based on a comparison of (i) actual results of the Company through the end of the
calendar quarter next preceding the Change in Control event to (ii) the targeted quarterly performance criteria set forth on the schedules attached hereto. The portion of the bonus based on personal objectives will be calculated through the end of
the calendar quarter next preceding the Change of Control event to the extent equitable and reasonably practicable in the judgment of the Organization and Compensation Committee. Qualitative measurements for which such calculation is not equitable
or reasonably practicable will be disregarded and the percentage of the bonus otherwise allocated thereto under the terms hereof will be reallocated in even percentages to the sales and earnings components of the bonus calculation. After determining
the full year bonus based on the extent to which the aforesaid quarterly targets have been achieved, the amount of the full year bonus will be prorated by multiplying the same by a fraction the numerator of which is the number of days between the
beginning of the fiscal year and the date of the Change of Control event and the denominator of which would be 365. The determination of the amount of any bonus payable under this paragraph to the Chief Executive Officer shall be made by the
Organization and Compensation Committee and for all other participants the determination of the amount of any bonus payable shall be made by the Chief Executive Officer and in each instance the determination shall be final and binding on the Company
and all participants. 

  

	 	G.	 	In the event of any material, unusual and non-recurring charge to income, purchase or sale of any material business unit by the Company, or other material event affecting the
ability of the participants to achieve the performance targets established under this Plan, the Organization and Compensation Committee shall review such performance targets and make such adjustments with respect thereto as it deems reasonable and
equitable in light of the purposes of this Plan. Any and all adjustments made by the Organization and Compensation Committee under this paragraph shall be final and binding on the Company and all participants. 

  

	 	H.	 	The Organization and Compensation Committee may in its discretion terminate the Plan as of the end of any fiscal quarter. If the Plan is so terminated, the Company shall pay out
bonuses to the participants in such amounts as are appropriate and equitable in light of the Company’s and participants’ performance through the end of such quarter and the targets established hereunder. The determination of the amount of
any bonuses payable under this paragraph shall be made by the Organization and Compensation Committee in line with the objectives set for each participant, and its determination shall be final and binding on the Company and all participants.


  

	 	I.	 	The personal objectives referred to herein and the application of certain provisions hereof are described in the FY04 Scorecard prepared by the Senior Vice President, Human
Resources. 

  

	 	J.	 	A “Change in Control” shall be deemed to have occurred if any of the events set forth in any of the following subparagraphs shall have occurred: 


 

	 	(1)	 	any Person (as defined below) is or becomes the Beneficial Owner (as Defined below), directly or indirectly, of securities of the Company representing 35% or more of either the then
outstanding shares of common stock of the Company or the combined voting power of the Company’s then outstanding securities, excluding any Person who becomes such a Beneficial Owner in connection with a transaction described in subparagraph (3)
(a) below; 









	 	(2)	 	the following individuals cease for any reason to constitute a majority of the number of Directors (as defined below) then serving: individuals who, on the date hereof, constitute
the Board (as defined below) and any new Director (other than a Director whose initial assumption of office is in connection with an actual or threatened election contest, including but not limited to a consent solicitation, relating to the election
of Directors of the Company) whose appointment or election by the Board or nomination for election by the Company’s stockholders was approved or recommended by a vote of at least two-thirds (2/3) of the Directors then in office who either were
Directors on the date this Plan was adopted or whose appointment, election or nomination for election was previously so approved or recommended; 

  

	 	(3)	 	there is consummated a merger or consolidation of the Company or any direct or indirect subsidiary of the Company with another corporation, other than (a) a merger or consolidation
which would result in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or
any parent thereof) at least 60% of the combined voting power of the securities of the Company or such surviving entity or any parent thereof outstanding immediately after such merger or consolidation, or (b) a merger or consolidation effected to
implement a recapitalization of the Company (or similar transaction) in which no Person is or becomes the Beneficial Owner, directly or indirectly, of securities of the Company (not including in the securities Beneficially Owned by such Person any
securities acquired directly from the Company of its Affiliates (as defined below)representing 35% or more of the combined voting power of the Company’s then outstanding securities; or 

  

	 	(4)	 	the stockholders of the Company approve a plan of complete liquidation or dissolution of the Company or there is consummated an agreement for the sale or disposition by the Company
of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, at least 60% of the combined voting power of the voting securities of
which are owned by stockholders of the Company in substantially the same proportions as their ownership of the Company immediately prior to such sale. 

  
 For purposes of the foregoing definition of a Change in Control event, the following terms have the meanings indicated
below: 
  

	 	i.	 	“Affiliate” shall have the meaning set forth in Rule 12b-2 promulgated under Section 12 of the Securities Exchange Act of 11934 (the “Exchange Act”);


  

	 	ii.	 	“Beneficial Owner” shall have the meaning set forth in Rule 13d-3 under the Exchange Act; and 

  

	 	iii.	 	“Board” means the Board of Directors of the Company. 

  

	 	iv.	 	“Director” means any individual who is a member of the Board. 

  

	 	v.	 	“Person” shall have the meaning given in Section 3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof, except that such term shall not
include (A) the Company or any of its subsidiaries, (B) a trustee or other fiduciary holding securities under an employee benefit plan of the Company or any of its Affiliates, (C) an underwriter temporarily holding securities Pursuant to an offering
of such securities and (D) a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company. 









	 	K.	 	Nothing contained in this Plan shall confer and no grant of a bonus hereunder shall be construed as conferring, upon any employee any right to continue in the employment of the
Company or any subsidiary of the Company or to interfere in any way with the right of the Company or any subsidiary to terminate the employee’s employment at any time or increase or decrease his compensation from the rate in existence as of the
effective date of this Plan or the granting of any bonus hereunder. 

  

	 	L.	 	This Plan shall be effective commencing July 1, 2003.