**Exhibit 10.1**

 

**ADAPTEC, INC.**

 

**Adaptec Incentive Plan Document**

**Fiscal Year 2005**

 

**1.             Plan Name andEffective Date**

 

The name of the plan is the Adaptec Incentive Plan (the “AIP”). The AIPis effective for Adaptec’s 2005 fiscal year from April 1, 2004 through March31, 2005 (“Fiscal Year 2005”).

 

**2.             Purpose**

 

The purpose of the AIP is to provide a direct financial incentive foreligible executives, managers and individual contributors to make a significantcontribution to Adaptec’s established goals in order to help Adaptec’sstockholders realize increased value from their investment.

 

**3.             Eligibility**

 

All full or part-time exempt employees in grade 21 and above areeligible to participate in the AIP. Employees in grades 21 and above working inSingapore are not eligible to participate in the AIP except for 8 or 9 keymanagers and executives as determined by the Compensation Committee of Adaptec’sBoard of Directors (the “Compensation Committee”). All eligible employees musthave worked for Adaptec at least six months and must still be an employee ofAdaptec at the time payments are made, as discussed below, in order to qualifyto participate in the AIP. Commissioned sales employees, temporary employeesand independent contractors are not eligible to participate in the AIP.  All Adaptec employees that are eligible toparticipate in the AIP are deemed to be “Participants” in the AIP.

 

**4.             Timing of AIPPayments**

 

Except for holdback payments as described in Section 8 below, paymentsthat become due under the AIP will be paid to Participants as soon asadministratively feasible after the overall budget is approved by theCompensation Committee following the close of the second quarter of Fiscal Year2005 or the fourth quarter of Fiscal Year 2005, as applicable.

 

**5.             Funding the AIP Pool**

 

The AIP reinforces two key goals that support Adaptec’s strategicplans: maximizing Adaptec’s revenue (“Revenue”) and maximizing Adaptec’sOperating Profit Before Taxes (“OPBT”). In order for the Compensation Committee to fund the AIP incentive pool(the “AIP Pool”) and in order for Participants to be eligible to receivepayments 

 

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from the AIP Pool, Revenue and OPBT each must meet minimum thresholdsas determined by the Compensation Committee.

 

The matrix for determining the size of the AIP Pool for Adaptec’s Q1and Q2 performance is set forth in Chart A and the matrix for determining thesize of the AIP Pool for Adaptec’s Q3 and Q4 performance is set forth in ChartB. The size of the AIP Pool will be determined by the amount that each ofAdaptec’s Revenue and OPBT exceeds the minimum thresholds established by theCompensation Committee; as Revenue and OPBT increase, the AIP Pool willincrease as set forth in Chart A and Chart B. Revenue and OPBT are eachweighted equally in determining the size of the AIP Pool.  In addition, the Compensation Committee mayincrease or decrease the size of the AIP Pool by 25% based on Adaptec’sperformance during Fiscal Year 2005.

 

If the Revenue and OPBT minimum thresholds set by the CompensationCommittee are both not met, then no AIP Pool will be established.Notwithstanding the foregoing, in extraordinary and extenuating circumstances,the Compensation Committee may determine to fund the AIP Pool and make paymentsto Participants if Revenue and/or OPBT do not meet the established minimumthresholds.  In all cases, theCompensation Committee must review and approve the funding of the AIP Pool.

 

**Chart A**

 
| ** **        | ** ** | **Q1 and  Q2**    | ** ** |
|-------------------|------------|-------------------|------------|
| ** **        | ** ** | **AIP Pool**      | ** ** | **Revenue** | ** ** | **OPBT** | ** ** |
| ** **        | ** ** | **(in millions)** | ** ** | **(in millions)*** | ** ** | **(in millions)**** | ** ** |
|              |       | 6.38              |       | X + 26.00 |   | Y + 6.50 |   |
| 100% Payout==> |       | 5.88              |       | X + 24.00 |   | Y + 6.00 |   |
|              |       | 5.38              |       | X + 22.00 |   | Y + 5.50 |   |
|              |       | 4.88              |       | X + 20.00 |   | Y + 5.00 |   |
|              |       | 4.38              |       | X + 18.00 |   | Y + 4.50 |   |
|              |       | 3.88              |       | X + 16.00 |   | Y + 4.00 |   |
|              |       | 3.38              |       | X + 14.00 |   | Y + 3.50 |   |
|              |       | 2.88              |       | X + 12.00 |   | Y + 3.00 |   |
|              |       | 2.38              |       | X + 10.00 |   | Y + 2.50 |   |
|              |       | 1.88              |       | X + 8.00 |   | Y + 2.00 |   |
|              |       | 1.38              |       | X + 6.00 |   | Y + 1.50 |   |
|              |       | 0.88              |       | X + 4.00 |   | Y + 1.00 |   |
|              |       | 0.00              |       | X + 2.00 |   | Y + 0.50 |   |
|              |       | 0.00              |       | X |   | Y |   |

 

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**Chart B**

 
| ** **        | ** ** | **Q3 and Q4**** ** | ** ** |
|-------------------|------------|-------------------------|------------|
| ** **        | ** ** | **AIP Pool**            | ** ** | **Revenue** | ** ** | **OPBT** | ** ** |
| ** **        | ** ** | **(in millions)**       | ** ** | **(in millions)*** | ** ** | **(in millions)**** | ** ** |
|              |       | 7.50                    |       | A + 30.00 |   | B +7.50 |   |
|              |       | 7.00                    |       | A + 28.00 |   | B +7.00 |   |
|              |       | 6.50                    |       | A + 26.00 |   | B +6.50 |   |
|              |       | 6.00                    |       | A + 24.00 |   | B +6.00 |   |
| 100% Payout==> |       | 5.50                    |       | A + 22.00 |   | B +5.50 |   |
|              |       | 5.00                    |       | A + 20.00 |   | B +5.00 |   |
|              |       | 4.50                    |       | A + 18.00 |   | B +4.50 |   |
|              |       | 4.00                    |       | A + 16.00 |   | B +4.00 |   |
|              |       | 3.50                    |       | A + 14.00 |   | B +3.50 |   |
|              |       | 3.00                    |       | A + 12.00 |   | B +3.00 |   |
|              |       | 2.50                    |       | A + 10.00 |   | B +2.50 |   |
|              |       | 2.00                    |       | A + 8.00 |   | B +2.00 |   |
|              |       | 1.50                    |       | A + 6.00 |   | B +1.50 |   |
|              |       | 1.00                    |       | A + 4.00 |   | B +1.00 |   |
|              |       | 0.50                    |       | A + 2.00 |   | B +0.50 |   |
|              |       | 0.00                    |       | A |   | B |   |

 

**6.             Calculation ofPayments**

 

Chart C shows the targeted incentives by a Participant’s grade/positionand as a percentage of a Participant’s base salary if Adaptec were to reach the100% funding level set forth in Chart A and Chart B, as applicable. Chart Calso shows what percentage of the eligible employee population would betargeted to receive an incentive payment.

 

**Chart C**

 

Participants: AIP Payments (for six months)

 
| **Grade/Position**              | ** ** | **Target % of Base Salary** | ** ** | **Target Receiving** | ** ** |
|---------------------------------|------------|-----------------------------|------------|----------------------|------------|
| Chief  Executive Officer        |       | 85                          | %          | 100                  | %          |
| Chief  Financial Officer        |       | 60                          | %          | 100                  | %          |
| Vice  President/General Manager |       | 50                          | %          | 100                  | %          |
| Vice  President                 |       | 40                          | %          | 100                  | %          |
| 31-33                           |       | 25                          | %          | 70-90                | %          |
| 29-30                           |       | 15                          | %          | 70-90                | %          |
| 27-28                           |       | 12                          | %          | 70-90                | %          |
| 24-26                           |       | 10                          | %          | 70-90                | %          |
| 21-23                           |       | 8                           | %          | 70-90                | %          |

 

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**7.             AIP Payments**

 

Once the AIP Pool amount is determined for each six-month period, theactual payment to a Participant is based on the Participant’s performance andcan range from 0 to 200% of target incentive amount. In no case will the sum ofall payments exceed the amount funded by the AIP. All payments from the AIPPool made to Section 16(b) officers of Adaptec will be recommended by Adaptec’sCEO and will be reviewed by the Compensation Committee. In addition, theCompensation Committee will approve the CEO’s payment from the AIP Pool.

 

**8.             Holdback AIPPayments for Executive Participants**

 

Payments under the AIP that are to be made to Participants with aposition of Vice President or higher (“Executive Participants”) for first andsecond fiscal quarter achievements will be paid as follows.  Fifty percent (50%) of payments earned byExecutive Participants during the first half of Fiscal Year 2005 will be paidat the same time as AIP payments are made to other Participants and fiftypercent (50%) will be held back pending the performance of Adaptec in thesecond half of Fiscal Year 2005. This holdback will be paid to ExecutiveParticipants at the same time that other Participants receive payments underthe AIP following the close of the fourth quarter of Fiscal Year 2005 and couldbe funded at 0% to 150% depending on how Adaptec performs relative to theRevenue and OPBT thresholds established by the Compensation Committee.

 

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