THE PERFORMANCE GOALS).
11.
PERFORMANCE GOALS.
THE GRANTING AND/OR
VESTING OF AWARDS OF OPTIONS, RESTRICTED STOCK, RESTRICTED STOCK UNITS,
PERFORMANCE SHARES AND PERFORMANCE UNITS (INCLUDING PERFORMANCE UNITS PAYABLE IN
CASH) AND OTHER INCENTIVES UNDER THE PLAN MAY BE MADE SUBJECT TO THE ATTAINMENT
OF PERFORMANCE GOALS ("PERFORMANCE GOALS") RELATING TO ONE OR MORE OF THE
FOLLOWING MEASURES: (A) ACCOUNTS PAYABLE DAYS, (B) ACCOUNTS PAYABLE TURNS,
(C) ANNUAL REVENUE, (D) CASH COLLECTIONS, (E) CASH CYCLE DAYS, (F) CUSTOMER
SATISFACTION MBOS, (G) DAYS SALES OUTSTANDING, (H) EARNINGS PER SHARE, (I) FREE
CASH FLOW, (J) GROSS MARGIN, (K) GROSS PROFIT, (L) INVENTORY TURNS, (M) NET
INCOME, (N) NEW ORDERS, (O) OPERATING INCOME, (P) PRO FORMA NET INCOME,
(Q) RETURN ON DESIGNATED ASSETS, (R) RETURN ON EQUITY, (S) RETURN ON SALES, AND
(T) PRODUCT SHIPMENTS.
ANY PERFORMANCE GOALS MAY BE USED TO MEASURE THE
PERFORMANCE OF THE COMPANY AS A WHOLE OR A BUSINESS UNIT OF THE COMPANY AND MAY
BE MEASURED RELATIVE TO A PEER GROUP OR INDEX.
THE PERFORMANCE GOALS MAY DIFFER
FROM PARTICIPANT TO PARTICIPANT AND FROM AWARD TO AWARD. THE COMPENSATION
COMMITTEE MAY PROVIDE THAT PARTIAL ACHIEVEMENT OF THE PERFORMANCE GOALS MAY
RESULT IN THE PAYMENT OR VESTING CORRESPONDING TO A PARTIAL (BUT NOT NECESSARILY
PROPORTIONAL) PORTION OF THE AWARD.
PRIOR TO THE DETERMINATION DATE, THE
COMPENSATION COMMITTEE IS AUTHORIZED TO MAKE ADJUSTMENTS IN THE METHOD OF
CALCULATING THE ATTAINMENT OF PERFORMANCE GOALS FOR A PERFORMANCE PERIOD AS
FOLLOWS: (I) TO EXCLUDE RESTRUCTURING AND INTEGRATION CHARGES (INCLUDING
EMPLOYEE SEVERANCE AND BENEFITS COSTS AND CHARGES RELATED TO EXCESS FACILITIES
AND ASSETS); (II) TO EXCLUDE IMPAIRMENT CHARGES FOR GOODWILL AND INTANGIBLE
ASSETS AND AMORTIZATION EXPENSE; (III) TO EXCLUDE EXCHANGE RATE EFFECTS, AS
APPLICABLE, FOR NON-U.S. DOLLAR DENOMINATED NET SALES AND OPERATING EARNINGS;
(IV) TO EXCLUDE THE EFFECTS OF CHANGES TO GAAP REQUIRED BY THE FINANCIAL
ACCOUNTING STANDARDS BOARD; (V) TO EXCLUDE THE EFFECTS OF ANY STATUTORY
ADJUSTMENTS TO CORPORATE TAX RATES; (VI) TO EXCLUDE STOCK-BASED COMPENSATION
EXPENSE DETERMINED UNDER GENERALLY ACCEPTED ACCOUNTING PRINCIPLES; (VII) TO
EXCLUDE ANY OTHER UNUSUAL, NON-RECURRING GAIN OR LOSS OR EXTRAORDINARY ITEM;
(VII) TO RESPOND TO, OR IN ANTICIPATION OF, ANY UNUSUAL OR EXTRAORDINARY
CORPORATE ITEM, TRANSACTION, EVENT OR DEVELOPMENT; (VIII) TO RESPOND TO, OR IN
ANTICIPATION OF, CHANGES IN APPLICABLE LAWS, REGULATIONS, ACCOUNTING PRINCIPLES,
OR BUSINESS CONDITIONS; (IX) TO EXCLUDE THE DILUTIVE EFFECTS OF ACQUISITIONS OR
JOINT VENTURES; (X) TO ASSUME THAT ANY
16
BUSINESS DIVESTED BY THE COMPANY ACHIEVED PERFORMANCE OBJECTIVES AT TARGETED
LEVELS DURING THE BALANCE OF A PERFORMANCE PERIOD FOLLOWING SUCH DIVESTITURE;
(XI) TO REFLECT A CORPORATE TRANSACTION, SUCH AS A MERGER, CONSOLIDATION,
SEPARATION (INCLUDING A SPINOFF OR OTHER DISTRIBUTION OF STOCK OR PROPERTY BY A
CORPORATION), OR REORGANIZATION (WHETHER OR NOT SUCH REORGANIZATION COMES WITHIN
THE DEFINITION OF SUCH TERM IN CODE SECTION 368); AND (XII) TO REFLECT ANY
PARTIAL OR COMPLETE CORPORATE LIQUIDATION.
THE COMPENSATION COMMITTEE ALSO
RETAINS THE DISCRETION TO REDUCE OR ELIMINATE THE COMPENSATION OR ECONOMIC
BENEFIT DUE UPON ATTAINMENT OF PERFORMANCE GOALS.
12.
PERFORMANCE BONUS AWARDS.
ANY SERVICE