YEAR, SUCH THAT SALARY INCREASES AFTER THE FEBRUARY COMMITTEE
MEETING ARE NOT CONSIDERED FOR SUCH YEAR.
3.5
"TARGET BONUS PERCENTAGE" IS DETERMINED BY A
PARTICIPANT'S CLASSIFICATION AS SHOWN ON EXHIBIT B.
3.6
"ACTUAL BONUS AWARD" FOR THE YEAR IN
QUESTION MEANS THE BONUS EARNED BY A PARTICIPANT AND IS COMPUTED AS THE ACTUAL
BONUS PERCENTAGE TIMES A PARTICIPANT'S BASE PAY FOR THE YEAR IN QUESTION.
3.7
"ACTUAL BONUS PERCENTAGE" IS DETERMINED BY
MULTIPLYING THE TARGET BONUS PERCENTAGE BY THE BONUS PERFORMANCE VALUE.
3.8
"BONUS PERFORMANCE VALUE" IS AN AMOUNT
DETERMINED AS FOLLOWS:
(A) BASE FORMULA.
"BONUS PERFORMANCE VALUE" MEANS THE ACTUAL EVA MINUS THE
TARGET EVA, DIVIDED BY THE LEVERAGE FACTOR, PLUS 1.0 [((ACTUAL EVA - TARGET
EVA)/LEVERAGE FACTOR) + 1.0]; SUBJECT, HOWEVER, TO THE FOLLOWING SUBPARAGRAPHS
(B) AND (C).
(B) FLOOR/CEILING.
(I) IF THE CALCULATION OF THE BONUS PERFORMANCE VALUE IS
LESS THAN 0.20, THE BONUS PERFORMANCE VALUE SHALL BE DEEMED TO BE ZERO (0), AND
(II) IF THE CALCULATION OF THE BONUS PERFORMANCE VALUE EXCEEDS 2.5, THE BONUS
PERFORMANCE VALUE SHALL BE DEEMED TO BE 2.5.
(C) TARGET FORMULA B WITH PERFORMANCE VALUE GREATER THAN 1.0.
FOR PARTICIPATING
GROUPS TO WHICH TARGET EVA FORMULA B APPLIES, IF THE BONUS PERFORMANCE VALUE
CALCULATED UNDER SUBPARAGRAPH (A) IS GREATER THAN 1.0, THE FOLLOWING APPLIES:
(i)
In order to achieve a Bonus Performance Value of 2.5 (the "Maximum EVA
Award"), the "Bonus Performance Value" shall be determined as follows: the
Actual EVA minus the Maximum EVA Target, divided by the Leverage Factor, plus
1.0 [((Actual EVA - Maximum EVA Target)/Leverage Factor) + 1.0].
(ii)
If the Actual EVA is greater than the Target EVA but less than the minimum
amount of EVA necessary under subparaph (c)(i) above to achieve the Maximum EVA
Award (the "Maximum EVA"), the Bonus Performance Value shall be calculated by
straight line interpolation by determining the percentage by which the
5
Actual EVA falls between the Target EVA and the Maximum EVA and applying the
same percentage to the Bonus Performance Value between 1.0 and 2.5.
3.9
"LEVERAGE FACTOR" IS THE NEGATIVE (POSITIVE)
DEVIATION FROM TARGET EVA NECESSARY BEFORE A ZERO (TWO TIMES TARGET) BONUS IS
EARNED.
THE LEVERAGE FACTORS WILL BE EVALUATED AND RECALIBRATED, AS
APPROPRIATE, NO LESS THAN EVERY THREE YEARS.
SEE EXHIBIT C FOR THE LEVERAGE
FACTOR OF EACH PARTICIPATING GROUP.
3.10
"ADJUSTMENT GUIDELINES" ARE GUIDELINES THE
COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS (COMMITTEE) WILL CONSIDER IN
DETERMINING THE POTENTIAL TREATMENT OF ANY MATERIAL, NON-RECURRING OR UNUSUAL
ITEMS (SEE EXHIBIT D).
3.11
A PARTICIPANT'S CLASSIFICATION IS DETERMINED BY
THE COMMITTEE FOR OFFICERS OF THE MANITOWOC COMPANY, INC., AND BY THE SENIOR VP
OF HR & ADMINISTRATION FOR ALL NEW PARTICIPANTS BELOW THE LEVEL OF CORPORATE
OFFICER.
ARTICLE IV
PAYMENT OF ACTUAL BONUS AWARDS; BONUS BANK TRANSITION
4.1
BEGINNING WITH THE FISCAL 2005 PLAN YEAR,
ACTUAL BONUS AWARDS EARNED WILL BE FULLY PAID OUT AFTER THE END OF THE YEAR AT
SUCH TIME AS THE COMMITTEE DETERMINES, SUBJECT TO THE THREE-YEAR TRANSITION
PERIOD