Exhibit
10.19


FY’2006
Executive Incentive Plan


 





 


2006


Executive Incentive Plan


 


 


	
  

  	
  

  	
  

  



 


 


	
  Table of Contents

  	
   

  
	
  INTRODUCTION AND PRINCIPLES

  	
   

  
	
  PLAN PARTICIPATION

  	
   

  
	
  EFFECTIVE DATE

  	
   

  
	
   

  	
   

  
	
  PLAN DESIGN / MEASURES, & OBJECTIVES

  	
   

  
	
  PLAN
  MIX

  	
   

  
	
  TARGET INCENTIVE BONUS

  	
   

  
	
  PAY-OUT
  CALCULATION FOR CASH INCENTIVES

  	
   

  
	
  BASIS OF MEASURES AND PAYOUT SCHEDULE

  	
   

  
	
  OPERATIONS OFFICERS

  	
   

  
	
  STAFF OFFICERS

  	
   

  
	
   

  	
   

  
	
  CALCULATION OF BONUS PAYMENTS

  	
   

  
	
  GENERAL RULES

  	
   

  
	
  CASH ADVANCES

  	
   

  
	
  INCOME
  TAX

  	
   

  
	
   

  	
   

  
	
  TRANSFERS/NEW
  HIRES/TERMINATIONS/PART TIME PARTNERS

  	
   

  
	
  TRANSFERS

  	
   

  
	
  NEW
  HIRES

  	
   

  
	
  CALCULATION OF PRORATED AWARDS

  	
   

  
	
  EXCEPTIONS TO THE PLAN

  	
   

  
	
   

  	
   

  


 
 	
  OTHER TERMS

  	
   

  
	
  ACQUISITIONS
  AND OTHER UNUSUAL BUSINESS SITUATIONS

  	
   

  
	
  BUSINESS
  UNIT REVENUE/PROFIT/EXPENSE

  	
   

  
	
  COMPANY RIGHTS

  	
   

  



 


 


June 22, 2005


 





















 


 


 


	
  Section A

  	
   

  	
  Introduction
  and Principles

  



 


	
   

  	
   

  	
  The FY’2006 Executive
  Incentive Plan (EIP) provides an opportunity for executives of Cintas
  to share in the company’s success. Year-end bonus awards are paid if
  performance measures are met or exceeded. Awards are tied directly to the
  annual performance of Cintas and its divisions.

  
	
   

  	
   

  	
  Please
  note that the EIP is not just an individual
  incentive plan but rather, the recognition of both individual and
  organizational success. 

  
	
   

  	
   

  	
  Every
  executive will have at least 50% of their targeted incentive bonus based on
  the relevant Corporate measure (profit as a % of sales, % of revenue growth
  or EPS growth. As such, we all “succeed or fail as One Team”.

  
	
   

  	
   

  	
  Plan Participation

  
	
   

  	
   

  	
  This
  plan applies to all Cintas Officers.

  
	
   

  	
   

  	
  Effective
  Date 

  
	
   

  	
   

  	
  This
  Plan year is effective from June 1, 2005 until the end of our fiscal year,
  May 31, 2006 and it supersedes all prior EIP or
  officer compensation plans. Cintas reserves the right to amend and/or adjust
  this plan based on the strategic needs of our business. Communication to our
  participating partners will be made in a timely fashion.

  



 


	
  Section B

  	
   

  	
  Plan Design / Measures, & Objectives

  



 


	
   

  	
   

  	
  Plan Mix

  
	
   

  	
   

  	
  The FY’2006 EIP
  introduces the concept of “plan mix”. Each participating officer will share
  in the success of Cintas based on three (3) different compensation vehicles;
  base salary, incentive bonuses, and long term incentives (i.e. stock and
  stock options). 

  
	
   

  	
   

  	
  Operations Officers
  will be eligible for cash incentive bonuses tied to the following; a business
  unit percent of Profit as a % of Sales objective and a business unit percent
  of Revenue Growth objective. These objectives will be linked to the
  Operations Officers’ individual level of responsibility. Additionally,
  Operations Officers will be eligible for long term incentives (LTI) based on
  the achievement of the combination of % of Sales Growth and Profit as a % of
  Sales in their areas of responsibility (Cintas Rule 35 calculation) and
  Cintas Earnings per Share (EPS) Growth. 

  
	
   

  	
   

  	
  Staff Officers
  will be eligible for cash incentive bonuses tied to both a Cintas EPS Growth,
  and the Individual Goals linked to the Staff Officer’s individual area of
  responsibility. Additionally, Staff Officers will be eligible for long term
  incentives (LTI) based the same formula as their annual cash incentive bonus.
  

  
	
   

  	
   

  	
  For All Officers covered
  by the FY’2006 EIP, an officer could earn 0% up to a maximum of 200% of the
  cash bonus award depending on their overall performance in their two cash incentive
  bonus objectives. Additionally, depending on the results of the two LTI
  objectives, an officer could earn 0% LTI up to a maximum of 200% of the LTI
  award if that performance target is achieved.

  



 


	
   

  	
   

  	
  Target
  Incentive Bonus

  
	
   

  	
   

  	
  The “target incentive bonus” is the total cash
  incentive amount earned at the target objectives. Total Targeted Cash (TTC)
  represents an individuals base salary plus targeted cash incentives. Target
  bonus percentages may vary by position/level.

  



 


	
   

  	
   

  	
  Pay-Out Calculation for Cash Incentives

  
	
   

  	
   

  	
  For each measure, after the planned threshold
  is achieved, pay-out for that measure begins. If the “target” level is
  achieved, 100% of the bonus amount for that measure is earned, and if you
  achieve the level of maximum payout, 200% of the targeted award is earned.

  



 


 


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  Basis of Measures & Payout Schedule

  
	
   

  	
   

  	
  The following charts describe the Basis of
  Measures, Objectives, and Payout Schedules for Corporate Staff and Division
  Officers Annual Bonus and LTI Awards.

  



 


	
   

  	
   

  	
  Operations Officers

  
	
   

  	
   

  	
  Cash Incentive Bonus

  
	
   

  	
   

  	
  Business Unit Profit as a
      % of Sales

  
	
   

  	
   

  	
  Weighting

  	
   

  	
  Level of Achievement

  	
   

  	
  Bonus Payout
  %

  
	
   

  	
   

  	
  50%

  	
   

  	
  Below Threshold

  	
   

  	
  0%

  
	
   

  	
   

  	
   

  	
   

  	
  Threshold to Target

  	
   

  	
  50% of target and then
  straight line bonus payout based on % of profit growth achieved

  
	
   

  	
   

  	
   

  	
   

  	
  Target

  	
   

  	
  100.00%

  
	
   

  	
   

  	
   

  	
   

  	
  Target to Maximum

  	
   

  	
  Accelerated straight
  line bonus payout based on % of profit growth achieved

  
	
   

  	
   

  	
   

  	
   

  	
  Maximum

  	
   

  	
  200.00%

  
	
   

  	
   

  	
  Business Unit Percent of Revenue Growth

  
	
   

  	
   

  	
  Weighting

  	
   

  	
  Level of Achievement

  	
   

  	
  Bonus Payout
  %

  
	
   

  	
   

  	
  50%

  	
   

  	
  Below Threshold

  	
   

  	
  0%

  
	
   

  	
   

  	
   

  	
   

  	
  Threshold to Target

  	
   

  	
  50% of target and then
  straight line bonus payout based on % of revenue growth achieved

  
	
   

  	
   

  	
   

  	
   

  	
  Target

  	
   

  	
  100.00%

  
	
   

  	
   

  	
   

  	
   

  	
  Target to Maximum

  	
   

  	
  Accelerated straight
  line bonus payout based on% of revenue growth achieved

  
	
   

  	
   

  	
   

  	
   

  	
  Maximum

  	
   

  	
  200.00%

  
	
   

  	
   

  	
  LTI Award

  
	
   

  	
   

  	
  Operational Goals (Combination of Revenue Growth
  % Plus Profit %) —

  Rule 35 Calculation

  
	
   

  	
   

  	
  Weighting

  	
   

  	
  Level of Achievement

  	
   

  	
  LTI
  Award%

  
	
   

  	
   

  	
  50%

  	
   

  	
  Below Threshold

  	
   

  	
  0%

  
	
   

  	
   

  	
   

  	
   

  	
  Threshold to Target

  	
   

  	
  50% of target and then
  predetermined levels based on hitting performance targets

  
	
   

  	
   

  	
   

  	
   

  	
  Target

  	
   

  	
  100.00%

  
	
   

  	
   

  	
   

  	
   

  	
  Target to Maximum

  	
   

  	
  Predetermined levels
  based on hitting performance targets

  
	
   

  	
   

  	
   

  	
   

  	
  Maximum

  	
   

  	
  200.00%

  
	
   

  	
   

  	
  Cintas EPS

  
	
   

  	
   

  	
  Weighting

  	
   

  	
  Level of Achievement

  	
   

  	
  LTI
  Award%

  
	
   

  	
   

  	
  50%

  	
   

  	
  Below Threshold

  	
   

  	
  0%

  
	
   

  	
   

  	
   

  	
   

  	
  Threshold to Target

  	
   

  	
  50% of target and then
  predetermined levels based on hitting performance targets

  
	
   

  	
   

  	
   

  	
   

  	
  Target

  	
   

  	
  100.00%

  
	
   

  	
   

  	
   

  	
   

  	
  Target to Maximum

  	
   

  	
  Predetermined levels
  based on hitting performance targets

  
	
   

  	
   

  	
   

  	
   

  	
  Maximum

  	
   

  	
  200.00%

  



 


 


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  Staff Officers

  
	
   

  	
   

  	
  Cash Incentive Bonus

  
	
   

  	
   

  	
  Individual Goals

  
	
   

  	
   

  	
  Weighting

  	
   

  	
  Level of Achievement

  	
   

  	
  Bonus Payout
  %

  
	
   

  	
   

  	
  50%

  	
   

  	
  Does Not Meet Goals

  	
   

  	
  0%

  
	
   

  	
   

  	
   

  	
   

  	
  Meets Most Goals

  	
   

  	
  50%

  
	
   

  	
   

  	
   

  	
   

  	
  Meets Goals

  	
   

  	
  100.00%

  
	
   

  	
   

  	
   

  	
   

  	
  Exceeds Goals

  	
   

  	
  150.00%

  
	
   

  	
   

  	
   

  	
   

  	
  Outstanding Achievement

  	
   

  	
  200.00%

  
	
   

  	
   

  	
  Cintas EPS

  
	
   

  	
   

  	
  Weighting

  	
   

  	
  Level of Achievement

  	
   

  	
  Bonus Payout
  %

  
	
   

  	
   

  	
  50%

  	
   

  	
  Below Threshold

  	
   

  	
  0%

  
	
   

  	
   

  	
   

  	
   

  	
  Threshold to Target

  	
   

  	
  50% at threshold and
  then predetermined levels for hitting EPS Performance Targets

  
	
   

  	
   

  	
   

  	
   

  	
  Target

  	
   

  	
  100.00%

  
	
   

  	
   

  	
   

  	
   

  	
  Target to Maximum

  	
   

  	
  Predetermined levels
  for hitting EPS Performance Targets

  
	
   

  	
   

  	
   

  	
   

  	
  Maximum

  	
   

  	
  200.00%

  
	
   

  	
   

  	
  LTI Award

  
	
   

  	
   

  	
  Individual Goals

  
	
   

  	
   

  	
  Weighting

  	
   

  	
  Level of Achievement

  	
   

  	
  LTI
  Award %

  
	
   

  	
   

  	
  50%

  	
   

  	
  Does Not Meet

  	
   

  	
  0%

  
	
   

  	
   

  	
   

  	
   

  	
  Meets Most Goals

  	
   

  	
  50% and then
  predetermined levels based on hitting performance targets

  
	
   

  	
   

  	
   

  	
   

  	
  Meets Goals

  	
   

  	
  100.00%

  
	
   

  	
   

  	
   

  	
   

  	
  Exceeds Goals

  	
   

  	
  Predetermined levels
  based on hitting performance targets

  
	
   

  	
   

  	
   

  	
   

  	
  Outstanding Achievment

  	
   

  	
  200.00%

  
	
   

  	
   

  	
  Cintas EPS

  
	
   

  	
   

  	
  Weighting

  	
   

  	
  Level of Achievement

  	
   

  	
  LTI
  Award %

  
	
   

  	
   

  	
  50%

  	
   

  	
  Below Threshold

  	
   

  	
  0%

  
	
   

  	
   

  	
   

  	
   

  	
  Threshold to Target

  	
   

  	
  50% and then
  predetermined levels based on hitting performance targets

  
	
   

  	
   

  	
   

  	
   

  	
  Target

  	
   

  	
  100.00%

  
	
   

  	
   

  	
   

  	
   

  	
  Target to Maximum

  	
   

  	
  Predetermined levels
  based on hitting performance targets

  
	
   

  	
   

  	
   

  	
   

  	
  Maximum

  	
   

  	
  200.00%

  



 


	
  Section C

  	
   

  	
  Calculation of Bonus Payments

  



 


	
   

  	
   

  	
  General
  Rules

  
	
   

  	
   

  	
  Bonus calculations will be made using year-end
  actual results, subject to adjustment at the discretion of the CEO to exclude
  items that are not operational and therefore do not reflect the year’s
  performance against objectives, such as accounting principle changes or
  revenue from an acquisition that was not in the business plan. (See Section E
  for more detail).

  
	
   

  	
   

  	
  In
  addition, any automatic payroll deductions elected by the partners (e.g.
  401K, or company loan repayments as the CEO deems necessary, etc) will be
  deducted from their bonus. 

  
	
   

  	
   

  	
  Partners
  who receive an overpayment of their award are responsible for reimbursing
  Cintas the amount of the overpayment, except where prohibited by law

  
	
   

  	
   

  	
  Cash
  Advances

  
	
   

  	
   

  	
  No
  cash advances will be paid against EIP awards.

  



 


 


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  Income Tax

  
	
   

  	
   

  	
  Cash payments are treated as ordinary income,
  or according to local legislation, and are subject to withholding for all
  applicable taxes.

  



 


	
  Section D

  	
   

  	
  Transfers/New Hires/Terminations/Part Time
  Partners

  



 


	
   

  	
   

  	
  Transfers

  
	
   

  	
   

  	
  The partner’s Comp Plan will be changed to
  properly incentivise the partner for their new responsibility, at the discretion
  of the CEO. Any final award calculation will be calculated by taking into
  account the time spent under each plan. 

  If
  a partner is transferred from another incentive program or non-EIP-eligible position to an EIP-eligible
  role, or vice versa, the partner will be aligned to the appropriate Basis of
  Measures for the months spent in the eligible position.Any bonus will be paid
  on the normal payment cycle on the designated pay date.

  
	
   

  	
   

  	
  New
  Hires

  
	
   

  	
   

  	
  EIP
  eligible Officers hired during the year may receive a pro-rated award or may
  be given a special plan for the remainder of the fiscal year as determined by
  the CEO.

  
	
   

  	
   

  	
  Calculation
  of Prorated Awards

  
	
   

  	
   

  	
  The Company will pay the partner a pro rata
  share of the bonus earned from the beginning of the fiscal year until the
  point of the employee’s termination in the event that the employee retires,
  or their position is eliminated. If the employee is terminated because of
  poor performance, any bonus to be paid will be determined at the sole
  discretion of the Company, using its best judgment, taking all factors into
  consideration so as to be fair to both the partner and the Company. In the
  event that the partner leaves the Company during the year for any reason, or
  in the event the partner is terminated because of dishonesty,
  insubordination, or gross neglect, etc., the partner shall not be entitled to
  any of the bonus earned up to the point of his termination.

  
	
   

  	
   

  	
  Exceptions to the plan

  
	
   

  	
   

  	
  In general, no exceptions are made to the
  Basis of Measures alignment for eligible partners. If special circumstances
  cause the Basis of Measures alignment to be unfair to a particular individual
  or the Company, an exception request must be approved by the CEO who may approve
  the request at his discretion.

  



 


	
  Section
  E

  	
   

  	
  Other Terms

  



 


	
   

  	
   

  	
  Acquisitions and Other Unusual Business Situations

  
	
   

  	
   

  	
  The purpose of the formula and the Incentive
  Plan is to reward individuals for normal operating profits earned within his
  area of responsibility. Any incidences that abnormally inflate the profits of
  an operation such as the purchase or the sale of rental volume, the unusual
  sale of operating assets, or any other abnormal operational situation that
  causes the profits of the individual operation to abnormally increase, the
  Plan shall be adjusted so as to avoid any inequitable results to the partner
  or the Company.

  
	
   

  	
   

  	
  Business
  Unit Revenue/Profit/Expenses

  
	
   

  	
   

  	
  All financial numbers related to business
  unit/Cintas performance will be determined by the Cintas Accounting
  Department with the approval of our CFO and CEO. In cases of dispute, the
  Cintas Accounting Department figures will govern performance as it relates to
  calculating all bonus plan payouts.

  
	
   

  	
   

  	
  Company
  Rights

  
	
   

  	
   

  	
  Even though it is the
  intention of the Company to continue this Plan on an ongoing basis, from year
  to year, so that the employee can rely upon it in making long-term operational
  decisions, the Company does reserve the right to alter the program as it sees
  fit, from year to year.

  



 


 


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FY’2006
Executive Incentive Plan


 





 


 


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