syn_ex101-70930.htm


    Exhibit
      10.1

     

    SUMMARY
      OF KEY TERMS OF COMPENSATION ARRANGEMENTS WITH SYNTHETECH, INC. EXECUTIVE
      OFFICERS

     

     

    The
      table
      below provides information about key elements of compensation for Synthetech
      Inc.’s executive officers for the fiscal year ending March 31,
      2008.  In addition to equity compensation, the primary components of
      executive officer compensation are base salary and performance bonuses under
      the
      Key Employee Performance Plan (KEPP).

    


    Awards
      under the KEPP are determined as a percentage of base salary, with payment
      based
      on achievement of certain performance objectives based on (1) health,
      safety and environment goals, (2) business strategy goals and (3)
      business performance goals.  Objectives 1 and 2 have a score from zero
      to one and objective 3 has a score from zero to two. Payments are
      calculated on the performance in meeting the objective's goals, which is then
      multiplied by a weighted percentage for each objective based on the relative
      importance of the objective to the overall goals. This calculation yields a
      bonus percentage for the objective for the applicable participant in the
      KEPP. The sum of all of the bonus percentages for each objective is
      multiplied by the individual's salary percentage and the product is multiplied
      by the applicable prorated fiscal year 2008 salary, yielding the KEPP
      payout.  Weightings vary for specific objectives among participants in
      the KEPP, and not all business strategy objectives are applicable to each
      participant.  Payouts are based on the score for each individual and
      the applicable weighting percentage.  Based on Synthetech's
      performance for the first half of fiscal 2008, it has not accrued any
      amounts for potential payments under the KEPP.

    


    The
      2008
      base salaries, ranges of bonuses as a percentage of base salary and the
      performance objective allocations for Synthetech's executive officers who
      participate in the KEPP are as follows:

    


    
      	 	 	 	 	  	 	
              Fiscal
                2008 Target Bonus Allocation

              
              

            	 
	
              Name
                and Title

            	 	
              Fiscal

              2008

              Salary

            	 	
              Fiscal
                2008 Range of

              Cash
                Incentive
                as a % of Base Salary

            	 	
              Health,
                Safety and Environ-mental Objectives

            	 	 	
              Business
                Strategy Objectives

            	 	 	
              Business
                Performance Objectives

            	 
	
              Dr.
                Daniel T. Fagan

              Chief
                Executive Officer

            	 	$	
              
              

              150,000

            	 	
              0
                to 77% 

            	 	 	
              10%

            	 	 	 	
              30%

            	 	 	 	
              60%

            	 
	
              Dr.
                Gregory R. Hahn

              President
                and Chief Operating Officer

            	 	$	
              200,000

            	 	
              0
                to 81% 

            	 	 	
              10%

            	 	 	 	
              10%

            	 	 	 	
              80%

            	 
	
              Gary
                A. Weber

              Vice
                President of Finance and Administration and Chief Financial
                Officer

            	 	$	
              145,000

            	 	
              0
                to 57% 

            	 	 	
              10%

            	 	 	 	
              25%

            	 	 	 	
              65%

            	 
	
              Joel
                D. Melka2

              Vice
                President of Operations

            	 	$	
              140,000

            	 	
              0
                to 45% 

            	 	 	
              15%

            	 	 	 	
              35%

            	 	 	 	
              50%

            	 


    

     

    
      

    

    
      2 Mr.
        Melka's employment with Synthetech terminated as of October 31,
        2007.  Any payment he may be entitled to under the KEPP for
        fiscal 2008 performance will be prorated based on the period of the fiscal
        year prior to the date his employment terminated.



    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    For
      each
      of the members of senior management listed above, payment of the bonus target
      is
      based on achievement of objectives during the period from April 1, 2007 to
      March
      31, 2008 in the three categories listed above and further allocated based on
      the
      following subcategories and percentages, which may vary for each individual
      for
      each category; however the total for each individual adds to 100%:

     

    
      	
              Health,
                Safety and Environmental Objectives:

            	 	
              10-15%

            
	 	 	 	 
	 	
              Recordable
                Injuries

            	
              4-5%                

            	 
	 	
              Lost-Time
                Accidents

            	
              4-5%                

            	 
	 	
              Process
                Safety and Reportable Environmental Incident

            	
              2-5%                

            	 
	 	 	 	 
	
              Business
                Strategy Objectives:

            	 	
              10-35%

            
	 	
              New
                Technology

            	
              10%                

            	 
	 	
              New
                Business Areas

            	
              5%                

            	 
	 	
              Cost
                Controls and Improvements

            	
              10-20%                

            	 
	 	
              Process
                Development

            	
              5%                

            	 
	 	
              Sarbanes-Oxley 404
                Analysis

            	
              5-10%                

            	 
	 	
              Investor
                Relations

            	
              5%                

            	 
	 	
              ISO
                14001 Certification

            	
              5%                

            	 
	 	 	 	 
	
              Business
                Performance Objectives:

            	 	
              50-80%

            
	 	 	 	 
	 	
              Achieve
                Sales Target

            	
              10-20%                

            	 
	 	
              Achieve
                EBIT (earnings before interest and taxes) Target

            	
              40-60%                

            	 


    

     

    Dr.
      Joseph Murphy, Synthetech's Director of Business Development, does not
      participate in the KEPP but is subject to a separate sales incentive plan that
      pays 1.5% of eligible sales over $0.5 million for the period from September
      1, 2007 to August 31, 2008.