exv10w1



 





Exhibit 10.1




LaCrosse Footwear Inc.




2007 Annual Incentive Compensation Plan Document



 




Objective/Overview



The LaCrosse Footwear Inc. incentive compensation program is designed to reward performance based
on the achievement of desired annual corporate results. The LaCrosse incentive compensation
program seeks to drive positive performance by targeting our greatest opportunity to increase
shareholder value, which we’ve identified as profitable sales growth while maintaining a healthy
balance sheet. The financial metrics for 2007 are sales growth, profitability and inventory turns.



LaCrosse funds the Incentive Compensation Plan solely from Company profits. The Company must
achieve at least 75% of planned/budgeted 2007 operating profit dollars in order for any Incentive
Compensation payout, regardless of the achievement of any other performance metric.



The guidelines for the 2007 Incentive Compensation Plan are as follows:




Plan Year and Eligibility Requirements



The incentive compensation measurement plan year runs from January 1st through December
31st. All non-union LFI employees are eligible for the Incentive Compensation Plan
unless the individual is on a Sales Commission Plan. No employee can be on more than one incentive
compensation plan. Employees hired during the Plan year are eligible effective with their date of
hire. The actual incentive compensation payout, if any, is based on actual base pay wages
(excludes overtime earnings and bonus payments) paid during the calendar year.



The employee must be actively employed by the Company on the payment date in order to receive any
incentive compensation. Incentive compensation is not earned until paid. Payment date is
anticipated to be by the end of the first quarter of the following year, but is at the discretion
of the Company. An employee must have a minimum individual performance rating of “3” to be eligible to receive any
incentive compensation payout. An employee whose last overall performance rating is “1” or a “2”
will not be eligible to receive incentive compensation. Any employee on a written warning
at the time of the incentive compensation payment is also ineligible.



An individual’s incentive target compensation is set as a percentage of annual base pay earnings.
The incentive target compensation level for each employee is commensurate with his or her duties
and responsibilities within the organization. The target levels are reviewed annually and
employees are notified of any changes.




 









 





Communication



To assure the success of our incentive compensation plan, we will inform each participant of their
target compensation percentage and the specific corporate performance targets. In addition, we
will provide an update of the Company’s operating results and incentive compensation targets on a
quarterly basis.




Company’s Discretion



The Company has full authority to modify, change, amend or terminate this plan at its complete
discretion.




FINANCIAL COMPONENT




     The financial component or metric will be computed at the Corporate level as follows:



	 	 	 
	40%

	 	revenue growth variances (for manufacturing department only)
	 
	 	 
	40%

	 	operating profit
	 
	 	 
	20%

	 	inventory turns






40% — REVENUE GROWTH



Incentive payouts will be computed according to Net Sales as reported.




	 	 	 
	Results versus Goal	 	Incentive Compensation Amount
	 
	 	 
	< 95% of budget net sales dollars

	 	No incentive compensation
	Equal to or > 95% of budget net sales dollars

	 	Based on an incremental scale. There is no cap.





Exception: Portland Manufacturing has incentive compensation based on targeted variances in-lieu
of the revenue growth factor. There is a payout cap of 120% of variance target.




40% — OPERATING PROFIT



Incentive payouts will be computed according to Operating Income as reported.




	 	 	 
	Results versus Goal	 	Incentive Compensation Amount
	 
	 	 
	< 75% of budget operating income dollars

	 	No incentive compensation
	Equal to or >75% of budget operating income $

	 	Based on an incremental scale. There is no cap.






20% — INVENTORY TURNS



Inventory turns will be based on the number of inventory turns computed for the full fiscal year
and will be equal to standard COGS (no variances) for the year divided by average inventory.
Average inventory will equal the sum of each month ending inventory divided by 12.




 









 





	 	 	 
	Results versus Goal	 	Incentive Compensation Amount
	 
	 	 
	< 85% of budgeted inventory turns

	 	No incentive compensation
	Equal to or > 85% of budget inventory turns

	 	Based on an incremental scale. There is no cap.






Extraordinary Items and Board of Director Approval:



Extraordinary items will be evaluated by the Compensation Committee on a case-by-case basis as to
the impact on incentive compensation. The definition of extraordinary items are items/events which
are non-recurring and are not reflective of the on-going operation of the business as well as
considered beyond management control.



LFI’s Board of Directors and Management reserves the right to change, alter, terminate, or modify
this incentive compensation program as the business environment changes, or is deemed necessary.
All payments are subject to Compensation Committee approval, after year-end financial statements
have been audited.




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End of Filing