Exhibit
10.8


 





 


Executive Incentive Compensation Program


 


PURPOSE


 


The Executive Incentive
Compensation Program (“EICP” or the “Program”) of Charles River Laboratories, Inc.
(the “Company”) is designed to focus corporate officers, senior-level
management and other key employees on the achievement of organizational,
financial and operational goals that have been identified as important for the
success of the Company.  The Program is
also intended to attract and retain talented individuals with desired skills in
a competitive labor market.


 


DEFINITIONS


 


As
used herein, the following terms shall have the following meanings:


 


“Annual
Base Salary” refers
to a Participant’s base rate of pay, annualized, as of the last day of the
Program fiscal year.  It does not include
any additional payments that may have been made such as commissions, bonus
payments, overtime pay or imputed income.


 


“Award
Amount” is a
dollar amount determined for each Participant by multiplying the Participant’s
Annual Base Salary by their Award Percentage  for  each performance measure. 
The Award Amounts for each performance measure are then aggregated to
determine the total Award Amount.


 


“Award
Percentage” is a
percentage of the Target Percentage determined for each Participant by
multiplying his or her Target Percentage by his or her actual performance
rating at the end of a Program Year.


 


“Participant”
means an employee
of the Company who is eligible to participate in the EICP.


 


“Program
Year” means the
applicable Company fiscal year.


 


“Target
Award” means a
Participant’s targeted award amount which is determined by multiplying the
Participant’s Annual Base Salary by his or her Target Percentage.


 


“Target
Percentage” is a
pre-determined percentage of a Participant’s Annual Base Salary.  Target Percentages are determined based on a
Participant’s salary grade at the end of a Program Year.  Salary Grades of 88 through 93 and equivalent
grades receive a single Target Percentage.


 


“Target
Percentage Range” is
a range of Target Percentages of a Participant’s Annual Base Salary.  Target Percentage Ranges are determined based
on a Participant’s salary grade at the end of a Program Year.  Salary Grades of 94 and above receive a
Target Percentage Range.


 


ELIGIBILITY


 


Regular, full-time
employees who hold a position with a U.S. salary grade of 88 or higher (or
current or future salary grade equivalents) are eligible to participate in the
Program.  In addition, in order to be
eligible for participation in the Program, employees must be hired or promoted
into an eligible salary grade position on or before June 30th of the
applicable Program Year.  Employees hired
or promoted into an 


 


Effective:  January 1, 2009


 


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EICP eligible Salary
Grade position on or after July 1st of a Program Year are eligible to participate
in the Program the following fiscal year.


 


Employees, who
participate in the Company’s Technical Incentive Compensation Program (TICP) or
other Company-approved bonus/incentive programs, including sales commission
plans, are specifically excluded from participation in the EICP.


 


The Company’s
Chairman, President and Chief Executive Officer has the right to exclude
otherwise eligible employees from the Program if they are eligible for
alternate forms of incentive compensation (e.g., participation in a
post-acquisition earn-out).


 


Participants who move
from one eligible salary grade to another during the Program Year will
participate on a full-year basis at the Target Percentage or Target Percentage
Ranges, as applicable, corresponding to their new salary grade.  Target Percentages and Target Percentage
Ranges may be modified at the discretion of the Compensation Committee for
individual Participants or salary grades.


 


PERFORMANCE
MEASURES


 


Early in each Program
Year, Participants are assigned financial and/or operational objectives which
are established annually by the Company’s Chairman, President and Chief
Executive Officer and, in the case of Corporate Officers of the Company, are
reviewed and approved by the Compensation Committee of the Board of Directors.


 


Each Participant’s
performance during the Program Year is measured against financial or other
approved goals established for the Company, function and/or business unit(s) overseen
or supported by the Participant. 
Company, function and/or business unit objectives are weighted to
reflect their priority and to ensure that incentives are appropriately aligned
with business objectives.  Financial
performance measures underlying Program targets for each Program Year are
reviewed and approved annually in conjunction with the annual budget review
process by the Company’s Chairman, President and Chief Executive Officer, the
Company’s Corporate Executive Vice President, Human Resources and Chief
Administrative Officer, the Board of Directors and, as required, by the
Compensation Committee.


 


Participants who are
promoted and/or transferred during the Program Year and whose responsibilities
are significantly modified may have their performance objectives modified,
subject to the review and approval by the Company’s Chairman, President and
Chief Executive Officer and, as required, by the Compensation Committee.


 


AWARD CALCULATIONS


 


A Participant’s Award
Percentage is determined by evaluating actual performance against targeted
objectives.  Performance which falls
below targeted objectives by a specified percentage, total dollar amount or
other approved performance measures results in a zero performance rating, while
performance which exceeds targeted objectives by a specified percentage, total
dollar amount or other approved performance measures equates to a 250%
performance rating (i.e., an EICP Award Percentage that is two and one half
times the Participant’s targeted percentage). 
These specified performance parameters establish the slope along which
pay for performance is determined. 
Annual payouts for performance which exceed targeted objectives are
subject to a cap equal to a maximum of 250% of target.  However, if 


 


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total Company performance
for a given Program Year exceeds the maximum of the performance range
established by the Board of Directors for that Program Year, 30% of the excess
amount is made available for the Chairman, President and Chief Executive
Officer to make upward modifications to the Award Percentages of certain
Participants, at his discretion, subject to the limitation that any total Award
Amount is capped at a payment level equal to 300% of target.


 


At the discretion of the
Company’s Chairman, President and Chief Executive Officer and with the
concurrence of the Compensation Committee, a Participant’s calculated Award
Amount may be modified, upward or downward, if it is determined that the
calculated amount does not accurately reflect actual performance.


 


AWARD PAYMENTS


 


Award Amount payments
will be made to each Participant no later than 2 1⁄2 months after the end of each
Program Year.


 


TERMINATION OF EMPLOYMENT


 


In the event a
Participant resigns or if the Participant’s employment with the Company
terminates for any voluntary or involuntary reason other than retirement,
death, or disability at any time prior to the actual distribution of EICP Award
Amounts for a Program Year, such employee is no longer considered to be a
Participant in the Program as of the date of employment termination and is not
eligible to receive any Award Amount for such Program Year.


 


If a Participant’s
employment with the Company terminates due to his or her death, disability or
retirement prior to the end of a Program Year and the Participant had at least
six months of service to the Company during such Program Year, the Participant
(or the Participant’s beneficiary or estate in the event of death) may receive
a pro rated Award Amount for such Program Year at the discretion of the Company’s
Chairman, President and Chief Executive Officer and the Corporate Executive
Vice President of the Participant’s department and/or business unit.  Pro-rated Award Amounts will be determined
based upon the Participant’s actual period of active employment during the
Program year.  Severance periods and
periods of leaves of absence will not count toward satisfaction of such 6-month
service requirement or, if applicable, the computing of any pro-rated payment.


 


If a Participant’s
employment with the Company terminates due to his or her death, disability or
retirement after the close of a Program Year but prior to the actual
distribution of Award Amounts, the Participant (or the Participant’s
beneficiary or estate in the event of death) will be awarded his or her full
Award Amount for the Program Year.


 


In the event a
Participant’s employment with the Company is terminated because of a facilities
shut-down, full or partial business unit divestiture, or similar action
resulting in the termination of a Participant’s employment, the Company shall
not be obligated to pay any Award Amounts to an affected Participant as a
consequence of such employment termination.


 


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AWARD APPROVAL


 


Final Award Amounts for
all Participants are submitted to the Company’s Chairman, President and Chief
Executive Officer for review.  The
Chairman, President and Chief Executive Officer then reviews and approves
submissions relating to non-officer Participants, and submits to the
Compensation Committee his final Award Amount recommendations for Company
Corporate Officers, as well as any proposed Award Amount modifications.  The Chairman, President and Chief Executive
Officer may, at his discretion, modify any proposed final Award Amounts prior
to submitting them to the Compensation Committee.  The payment of Award Amounts to Company
Officers and all award modifications are subject to the review and approval of
the Compensation Committee.


 


PROGRAM ADMINISTRATION


 


The Compensation
Committee of the Board of Directors is responsible for the overall
administration of the Program.  The
Committee reviews and approves the standards and financial objectives
underlying the Program prior to its implementation for each Program Year.  The Committee may delegate the ongoing
oversight and handling of routine administrative matters under the Program to
the Company’s Corporate Executive Vice President, Human Resources &
Chief Administrative Officer.  The
Compensation Committee has the authority to alter or terminate the Program at
any time, and no Participant has any rights with respect to an incentive award
payable under the Program until it has actually been paid to the Participant.


 


Any questions pertaining
to the Program design, eligibility, calculation of Award Amounts, or other
procedures should be directed to the Company’s Corporate Executive Vice
President, Human Resources & Chief Administrative Officer.


 


APPROVED:


 


	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
   

  
	
  James C. Foster

  	
   

  	
   

  	
   

  
	
  Chairman,
  President & CEO

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
   

  
	
  David P. Johst

  	
   

  	
   

  	
   

  
	
  Corporate Exec. V.P.,
  Human Resources

  	
   

  	
   

  	
   

  
	
  & Chief
  Administrative Officer

  	
   

  	
   

  	
   

  



 


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