exv10w1



 





Exhibit 10.1




LaCrosse Footwear, Inc.


2008 Annual Incentive Compensation Plan Document




Objective/Overview




The LaCrosse Footwear Inc. Incentive Compensation Plan is designed to reward
performance based on the achievement of desired annual corporate results. The
LaCrosse Incentive Compensation Plan 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 2008 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 2008 operating profit
dollars in order for any Incentive Compensation payout, regardless of the
achievement of any other performance metric. Our Board of Directors approves the
budgeted net sales and operating profit annually.



The guidelines for the 2008 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 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” or is on written warning, will
not be eligible to receive incentive compensation until such time as the
associated corrective action plan has been successfully completed.



Incentive Payout Calculation




The actual incentive compensation payout, if any, is based on pro-rated annual
base pay.



An individual’s incentive target compensation is set as a percentage of annual
base pay. 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. Changes in target incentive compensation percentage are pro-rated for
the months each rate is in effect.



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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	%	 	net sales growth OR 

manufacturing variances (for Portland manufacturing department only)

	 
	 	40	%	 	operating profit

	 
	 	20	%	 	inventory turns







40% — NET SALES GROWTH




Incentive payouts will be computed according to budgeted Net Sales.



	 	 	 
	Results versus Goal	 	Incentive Compensation Amount
	< 94% of budget net sales dollars

	 	No incentive compensation payout
	 
	Equal to or > 94% of budget net sales dollars

	 	I.C. based on an incremental scale. There is no cap.






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







40% — OPERATING PROFIT




Incentive payouts will be computed according to Corporate Operating Profit.



	 	 	 
	Results versus Goal	 	Incentive Compensation Amount
	< 75% of budget dollar amount

	 	No incentive compensation payout
	 
	Equal to or >75% of budgeted Op. Profit $

	 	I.C. based on an incremental scale. There is no cap.






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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.



	 	 	 
	< 93% of planned inventory turns

	 	No incentive compensation awarded.
	 
	Equal to or > 93% of planned Inv. Turns

	 	I.C. 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 of the
LaCrosse Board of Directors 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





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