Unassociated Document









Exhibit 10.34


 


SUNPOWER CORPORATION


EXECUTIVE QUARTERLY


KEY INITIATIVE BONUS PLAN


(Amended and Restated January 31, 2011)









Article 1 - Exec KI Plan Objective








	
1.1

	
The objective of this Executive Quarterly Key Initiative Bonus Plan (“Exec KI Plan”) is to provide incentives to key employees of SunPower Corporation and its subsidiaries (collectively, the “Company”) based on the Company’s quarterly company milestones and an individual's performance against set individual key initiatives (KIs).  The Exec 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, 2010.  “Plan Periods” under the Exec KI Plan will correspond to the fiscal quarters of the Company.












Article 3 - Eligibility for Exec KI Plan Participation








	
3.1

	
All executive officers of the Company, as well as any other key employees approved by the Compensation Committee of the Board of Directors, shall participate in the Exec KI Plan.  Participation will generally be limited to the CEO and executive direct reports.












Article 4 - Target Bonus Percentages and Calculations








	
4.1

	
Exec KI Target Bonus Percentages.  Each Exec 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  

	
Exec 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 company milestones for such quarter.









 


 




	 	
Page 1 of 4

	
Company Confidential



















 




  





  











  













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 Exec 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 80% of the Plan PBT (or if Actual PBT is less than Plan PBT if plan PBT is zero or less), no KI bonus payout will be made for the quarter.













	
  

	
(ii)

	
If the Actual PBT is equal to or greater than 80% 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 80% AND the company milestone score is greater than 60%, the quarterly KI bonus will be paid as follows:















	
  

	
a.

	
Company 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.  If the Actual PBT is equal to or greater than 100%, the quarterly KI bonus will be prorated and paid above 100%, subject to a maximum cap of 125%.  For example, if the Actual PBT is 115% of the Plan PBT, in the example above the payment would be $16,000 x 115% = $18,400.













	
  

	
b.

	
Company Milestone Score less than or equal to 80%:   One-half KI score payout.













	
  

	
(iv)

	
If both the Company Milestone score is equal to or greater than 80% and the Actual PBT is greater than 100%, the quarterly KI bonus may be prorated and paid above 100%, subject to a maximum cap of 125%.  The Board reserves the right to reduce payments above 100% of target, should the sum of payments above target for all eligible employees become a material portion of the Actual PBT achieved by the Company.












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








	
5.1

	
Payout calculations under the Exec KI Plan will be based on the plan participant's base salary at the end of the quarter being measured.







 


 




	 	
Page 2 of 4

	
Company Confidential







 








 




  





  











  














	
5.2

	
In the event a participant’s KI target bonus percentage is changed during the quarter, the participant’s KI payout for the quarter shall be based on the KI target bonus in effect at the end 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 company 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 complete month of work, i.e. if they start the first business day of the month, they will be eligible to participate that month;  otherwise, they will begin participation the following month.













	
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%.  If/when the participant returns from disability leave, participation will be handled as outlined in section 7.2 above.













	
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.







 


 




	 	
Page 3 of 4

	
Company Confidential







 








 




  





  











  














	
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 Sections 7.3, 7.4, 7.5,and 7.6 will be paid in a 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 Exec KI Plan is transferable or assignable except by will or laws of descent and distribution.













	
8.2

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













	
8.3

	
Participation in the Exec 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 Exec KI Plan, at any time, and for whatever reasons.













	
8.5

	
This Exec 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.  Accounts recognized by the Company for book purposes are not an indication of funds set aside for payment.  Exec 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 Exec KI Plan shall not limit the ability of the Compensation Committee (or its designees) to modify said Exec 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.







 


 




	 	
Page 4 of 4

	
Company Confidential