Document:

EXHIBIT 10.3

 

 

EXHIBIT 10.3

PRO-DEX INC.
AMENDED AND RESTATED
LONG-TERM INCENTIVE PLAN

INTRODUCTION

The
Pro-Dex, Inc. Long-Term Incentive Plan (the "Plan") is a long-term
incentive plan for eligible employees of the Company. The Plan is intended to
provide equity-based incentive opportunities to executives and other key
employees of the Company. Plan payments, if any, will be conditioned on
attainment of certain Performance Goals for one or more fiscal years as
approved by the Committee and ratified by its Board of Directors.

I.  PURPOSE

The
purpose of the Plan is to allow the Company to attract, motivate and retain
highly qualified employees; to obtain from each employee the best possible performance; to
establish Performance Measures that support the Company's long-term business
strategies; and to provide consistency in and alignment with the
Company's approach to performance-based pay and overall executive compensation
strategy.

 

The Plan is established
under, and constitutes part of, the First Amended and Restated 2004 Stock
Option Plan (the “2004 Plan”) adopted by the Company and approved by the
shareholders.  In the event of any conflict between the Plan and the 2004 Plan,
the provisions of the 2004 Plan shall govern.

II. DEFINITIONS

For
purposes of the Plan, the following terms shall have the following meanings:
 

AWARD PARAMETERS DESCRIPTION. A document or compilation of documents approved by
the Committee and ratified by the Board of Directors,
in writing, to set forth the parameters necessary for determining a Long-Term
Incentive Compensation Award, including the (i) Award Period, (ii) the Performance Measures, (iii) the Performance Goals
and (iv) the amount of Long-Term Incentive Compensation Award payable with
respect to the achievement of each Performance Goal. The award
parameters described in the Award Parameters Description need not be identical
for all the Participants.

 

AWARD PERIOD. Unless otherwise provided by the
Committee and ratified by the Board of Directors, the Award Period to which a
Long-Term Incentive Compensation Award
relates shall encompass three (3) consecutive fiscal years.

BOARD OF DIRECTORS.
The Board of Directors of Pro-Dex, Inc.; provided that, with respect to any
Long-Term Incentive Compensation Awards of the Chief Executive Officer of
Pro-Dex, Inc. , "Board of Directors" shall mean only the members of
the Board of Directors who qualify as "outside directors" under
Section 162(m) of the Code and who meet the independence requirements of
applicable law and the NASDAQ Listing Rule 5605(a)(2) (or any such comparable
provision of any other primary exchange on which the company's
shares are listed).

 

 

	

 

CAUSE. Cause has the meaning given to
such term in any employment agreement with the Company to which the Participant
is a party and in the absence of such agreements (and not intended to modify or
add to any such existing agreement terms), it shall mean: (i) conviction for
the commission of a felony or a crime involving moral turpitude or the
commission of any other act or omission involving dishonesty, disloyalty
or fraud; (ii) conduct that brings or is reasonably likely to bring the Company
into public disgrace or disrepute, (iii) repeated failure to perform duties as
reasonably directed by the Company; (iv) gross negligence or willful misconduct
with respect to the Company; and/or (v)
habitual insobriety, or use of illicit drugs or other controlled substances
following one medically supervised course of treatment for such drug or
alcohol use or upon refusal to participate in such course of treatment.

 

CHANGE IN CONTROL. "Change in the ownership or effective control of the
corporation" or "change in the ownership of a substantial portion of
the assets of the corporation", as such terms are defined in Section
1.409A-3(i)(5) of the final regulations and other applicable guidance
promulgated under Section 409A of the Code.

 

CODE. The Internal Revenue Code of
1986, as amended, and any regulations thereunder, and any successors thereto.

 

COMMITTEE. The Compensation Committee of the
Board of Directors.

 

COMPANY. Pro-Dex Inc., its subsidiaries and any other entity
which is a "service recipient" (as such term is defined in Section
1.409A1(g) of the final regulations and other applicable guidance promulgated
under Section 409A of the Code) with respect to persons performing services for
the Company.

 

DISABILITY. "Disability", as such term is defined in
Section 1.409A-3(i)(4) of the final regulations and other applicable guidance
promulgated under Section 409A of the Code.

 

LONG-TERM INCENTIVE COMPENSATION AWARD. Any award paid pursuant to the Plan. A Long-Term
Incentive Compensation Award shall be determined by the Committee and ratified
by the Board of Directors, in its sole and absolute discretion. Unless
otherwise specified by the Committee and
ratified by the Board of Directors, with respect to any Performance Measure:
(i) the Long-Term Incentive Compensation Award payable with respect to the maximum Performance Goal shall not exceed
one hundred and fifty percent (150%) of the Long-Term Incentive Compensation
Award payable with respect to the target Performance Goal; and (ii) the
Long-Term Incentive Compensation Award payable with respect to a minimum
Performance Goal shall not be less than fifty percent (50%) of the Long-Term
Incentive Compensation Award payable with respect to the target Performance Goal. The Long-Term Incentive
Compensation Award payable to any individual Participant with respect to any
particular Award Period shall not exceed $1,000,000. (one million
dollars).

 

PARTICIPANT. An executive or other key
employee of the Company, or a person who has agreed to commence serving in any
of such capacities, and who is designated
by the Committee to participate in the Plan. No person shall be a Participant
in the Plan prior to the execution by such person of the Participation
Agreement.

 

 

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PARTICIPATION AGREEMENT. An agreement executed by the Participant in
substantially the form attached hereto as Exhibit A. Executed Participation Agreements are incorporated into the
Plan by reference and made a part thereof to the same extent and with the same
force and effect as if fully set forth therein.

 

PERFORMANCE GOAL. Performance Goal means, with respect to a Performance Measure, a
measure of achievement of such Performance Measure, approved by the Committee
and ratified by the Board of Directors and set forth in the Award Parameters
Description. Unless otherwise provided by the Committee and ratified by the
Board of Directors, there shall be three (3) Performance Goals with
respect to each Performance Measure – (i) minimum Performance Goal, (ii) target
Performance Goal and (iii) maximum Performance Goal. Performance Goals shall be
deemed to be achieved only if achieved in the course of the applicable Award
Period.

 

PERFORMANCE MEASURES. Certain performance categories set forth in
Section
V of the Plan. Performance Measures shall be set forth by the Committee in
the Award Parameters Description.

 

PRO-DEX, INC. Pro-Dex, Inc., a Colorado corporation.

 

SEPERATION FROM SERVICE. "Separation from service", as
such term is defined in Section 1.409A-1(h) of the final regulations and other
applicable guidance promulgated under Section 409A of the Code.

 

TSR. TSR (total shareholder return)
shall mean A minus B expressed as a percentage of B (A-B)/x100)], where
A is the per-share price of a Company's common stock at the end of the
applicable Award Period and B is the average per-share price of the Company's
common stock at the beginning of the applicable Award Period. For purposes of
calculations of TSR, cash dividends paid on a share of common stock shall be
deemed to be reinvested in the Company's common stock on the day they are paid
at the average of the high and the low per-share price of that Company's common
stock on that day, as quoted on the primary exchange on which the Company's
shares are listed. The value at the end of the applicable Award Period of such
common stock deemed purchased with cash dividends shall be added to A (above)
for purposes of calculation of TSR. If in the course of the Award Period the
outstanding shares of common stock of the Company are increased or decreased or
changed into or exchanged for a different number or kind of shares or other
securities of the Company by reason of any recapitalization, reclassification,
reorganization, stock split, reverse split, combination of shares, exchange of
shares, stock dividend or other distribution payable in capital stock of the
Company or other increase or decrease in such shares effected without receipt of consideration by the Company,
an appropriate and proportionate adjustment approved by the Committee shall be
made to the calculation of TSR set
forth above. For purposes of determining TSR, the stock price at the beginning
date and end date of an Award Period shall be the average of the closing
stock prices for the ninety (90) days immediately preceding such dates as
quoted on the primary exchange on which the company's shares are listed.

III. EFFECTIVE DATE

The Plan
is effective as of July 1, 2010.

 

IV. DETERMINATION OF
AMOUNTS OF AND ELIGIBILITY FOR LONG-TERM INCENTIVE COMPENSATION AWARDS

 

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Unless otherwise
provided in the Plan, if the Performance Goals are achieved in the course of
the applicable Award Period and such achievements are certified by the
Committee based upon the audited financial statements for the last fiscal year
of the Award Period contained in the Company's annual report filed with the Securities and Exchange Commission,
then Long-Term Incentive Compensation Awards will be paid in amounts determined
by the Committee and ratified by the Board of Directors pursuant to the
Plan and the Award Parameters Description. Unless otherwise set forth in the
Award Parameters Description with respect to
any Participant: (i) the amount of the Long-Term Incentive Compensation Award
payable in connection with achieving any Performance Goal of TSR shall
not exceed fifty percent (50%) of the maximum Long-Term Incentive Compensation
Award that can be made under the Plan in connection with the applicable Award Period; and (ii) the amount of
the Long-Term Incentive Compensation Award payable in connection with achieving
any Performance Goal(s) other than
TSR shall not exceed fifty percent (50%) of the maximum Long-Term Incentive
Compensation Award that can be made under the Plan in connection with
the applicable Award Period.

V. PERFORMANCE MEASURES

A. Generally. Unless otherwise
provided in the Plan, payment of Long-Term Incentive Compensation Awards is
conditioned on the attainment in the course
of the Award Period of Performance Goals set with respect to Performance Measures.
The Performance Goals and Performance Measures need not be identical
with respect to all the Participants. Performance Goals may be established
based upon the Company's performance in isolation or by judging the
Company's performance relative to one or more comparator companies or upon the
performance of one or more of the Company's subsidiaries or
divisions. Performance Goals and the amount of Long-Term Incentive Compensation
Award payable with respect to the achievement of any Performance Goal for any
Long-Term Incentive Award that is
intended to qualify as "performance-based compensation" under Section 162(m) of the Code must be
established in writing no later than September 13 (i.e. 75 days) following the
beginning of the applicable Award Period and may be based on one or more
of the following objective criteria (the "Performance Measures"):

 

	 	
		(1)
	
		TSR, including its components of stock price
appreciation, dividends and/or dividend yield;

	 	 	 
	 	
		(2)
	
		Return on assets,
equity, invested capital, cash flow, investment, or sales;

	 	 	 
	 	
		(3)
	
		Sales, including
gross margin;

	 	 	 
	 	
		(4)
	
		Pre-tax or after-tax profit
levels, including: earnings per share; earnings before interest and taxes;
earnings before interest, taxes, depreciation and amortization; net operating
profits after tax, and net income;

	 	 	 
	
		  
		
	
		(5)
	
		Cash flow and
cash flow return on investment;

	 	 	 
	 	
		(6)
	
		Economic profit
and/or cost of capital;

	 	 	 
	 	
		(7)
	
		Turnover of
assets, capital, or inventory;

	 	 	 
	 	
		(8)
	
		Levels of operating expense or
other expense items as reported on the income statement, including operating
and maintenance expense;

	 	 	 
	 	
		(9)
	
		Measures of customer satisfaction
and customer service, including the relative improvement therein; and

	 	 	 
	 	
		(10)
	
		Market share,
including by product line or geographic market or submarkets.

 

 

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Performance
Goals may be determined by reference to levels of and/or growth in a
Performance Measure. Performance Goals with respect to Performance Measures shall be objectively measurable and
established for a period coinciding with or ending within the Award Period.

 

B. Certain Factors and Events Excluded. In establishing Performance Goals and Performance
Measures for Participants and in certifying the achievement of Performance
Goals as the end of an Award Period, the Committee may include or exclude the
impact of specified objective events, including any of the following: expenses as a result of restructuring
or productivity initiatives, non-operating items; acquisition expenses; and any
other items of gain, loss or expense that are determined to be
extraordinary or unusual in nature or infrequent in occurrence or related to
the disposal of a segment of a business or to a change of accounting
principles.

 

C. Default Performance Measures. Unless otherwise specified by the Committee and
ratified by the Board of Directors, the Performance Measures shall consist of:
(i) TSR relative to a group of comparator companies; and (ii) one or more
Performance Goals other than TSR.

VI.    
PAYMENT OF
LONG-TERM INCENTIVE COMPENSATION AWARDS

A.  Type of
Payment.  Unless otherwise provided in the Plan, the payment of a Long-Term
Incentive Compensation Award shall be made on the first day following the
approval of such award by the Committee and the filing of the fiscal year end
Form 10-K for the final year of the Award
Period to which it relates; provided that, subject to Section VII, the
Participant is actively employed with the Company on such date. Unless
otherwise provided in the Plan, Long-Term Incentive Compensation Awards shall
be paid in shares of Company restricted stock valued at the closing price of
the Company’s shares on the day preceding such payment.  For the purposes of
this Section VI, payment within 75 days following a specified payment date
shall be deemed to constitute payment on the specified payment date.

 

B.  Restriction.  Unless otherwise
specified by the Committee and ratified by the Board of Directors, no restricted
stock awarded under the Plan may be sold, transferred, assigned, pledged or
otherwise encumbered or disposed of by the Participant receiving such restricted
stock until 30 days after its payment to Participant as described in subsection
A of Section VI herein.  The restrictions described herein shall be evidenced
by a certificate, which certificate shall be held in such form and manner as
determined by the Committee and shall contain an appropriate legend clearly
stating the restricted stock represented by the certificate is restricted according
to the terms of the Plan.

 

C.  Source of Long-Term Incentive
Compensation Awards.  In the case of a Long-Term Incentive Compensation
Award under the Plan that is paid in shares of restricted Company stock, such
shares shall be distributed as part of and in accordance with the 2004 Plan as
amended from time to time.  The aggregate number of shares of restricted stock issued
under the Plan, when combined with all other shares issued by the Company under
the 2004 Plan, shall not exceed the number of shares authorized under the 2004
Plan.  Furthermore, any Long-Term Incentive Compensation Award shall be of the
same type of awards authorized under the 2004 Plan.

VII.  TERMINATION OF SERVICE, SPIN-OFFS AND
SIMILAR TRANSACTIONS DURING THE AWARD PERIOD

 

 

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A. Involuntary Separation from Service, Death or
Disability. Subject to Section VII.
C., if before the end of an Award Period a Participant experiences a Separation
from Service with the Company by virtue of termination of the Participant's
service by the Company, other than for Cause, or if a Participant experiences
Separation from Service with the Company due to death or Disability, the
Participant's Long-Term Incentive Compensation Awards for any Award Period in
effect at the time of such Separation from Service will be prorated on the
basis of the ratio of the number of days of Participant's service during such
Award Period prior to such Separation from Service to the total number of days
in such Award Period. The determination of such prorated Long-Term Compensation
Awards will be based on the attainment of the Performance Goals with respect to
the applicable Performance Measure(s) and will be paid on the date the Participant would have received payments
with respect to such Long-Term Compensation Awards had the Participant not
experienced a Separation from Service with the Company.

B. Termination by the
Company for Cause, Voluntary Separation from Service. In the event a
Participant experiences a Separation from Service with the Company by virtue of
termination of the Participant's service by the Company for Cause,
or by virtue of voluntary termination of
service by the Participant, the Participant shall have no rights whatsoever to
any unpaid Long-Term Compensation Awards and no payments with respect to
any unpaid Long-Term Compensation Awards shall be made to the Participant.

C. Termination Close In Time To the Change in Control of
Pro-Dex, Inc. In the event the
Participant experiences a Separation from Service with the Company (not
including separation caused by death or Disability) by virtue of termination of
the Participant's service by the Company less than six (6) months following a
Change in Control of Pro-Dex, Inc., and such Separation from Service occurs
prior to the end of the Award Period, then upon the Participant's Separation from Service, all Performance Goals
with respect to Performance Measures shall be deemed to have been met with
respect to such Participant and any applicable Long-Term Incentive
Compensation Awards shall be paid to such Participant on the date of Separation
from Service. This Section VII. C. shall not apply if the Participant's
service with the Company is terminated by the Company for Cause. Additionally,
this Section VII. C. shall not apply unless at the time of Change in Control of
Pro-Dex, Inc., the entity for whom the Participant is performing services is
Pro-Dex, Inc. or Pro-Dex, Inc. is the "majority shareholder"
(as such term is defined in Section 1.409A-3(i)(5)(ii)(3) of the final
regulations promulgated under Section 409A of the Internal Revenue Code) of
such entity.

D. Spin-Offs and Similar Transactions. In the event an entity ("Departed Entity")
that is a part of the Company ceases to be a part of the Company (the "Departure"), a Participant
who at the time of the Departure is performing services for the Departed
Entity, shall be considered, for purposes of Section VII. A.., to have experienced a Separation from Service with
the Company by virtue of termination of the Participant's
service by the Company without Cause; provided that such Participant
does not perform any services for the Company immediately after the Departure.
Such Separation from Service with the Company will be deemed to have occurred
at the time of the Departure.

 

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E. Specified Employees.
Notwithstanding anything in the Plan to the contrary, if as of the date of
Participant's Separation from Service, Participant is a
"specified employee", as defined under Section 409A of the
Internal Revenue Code of 1986, as amended ("Section 409A")
or any regulations or Treasury guidance promulgated thereunder ("Section
409A Guidance"), Participant shall not be entitled to any
payments paid upon such Separation from Service until the earlier of (i) the
date which is six months after his Separation from Service for any reason other
than death or (ii) the date of his death. The provisions of this Section VII.
E. shall apply solely to payments made pursuant to a plan that provides for
deferral of compensation. Whether a plan provides for deferral of compensation
shall be determined pursuant to Section 409A or Section 409A Guidance. Any
payments that would have been paid to Participant prior to the earlier of (i)
the date which is six months after his separation from service for any reason
other than death or (ii) the date of his death, were it not for this Section
VII. E., shall be accumulated and paid to Participant on the first day of the
7th month following Participant's Separation from Service.
Notwithstanding the foregoing, the provisions of this Section VII. E. shall not
apply to payments
made under the circumstances described in Section 1.409A-3(j)(4)(ii) (domestic
relations order), 1.409A-3 (j)(4)(iii) (conflicts of interest) or 1.409A-3 (j)(4)(vi) (payment of employment taxes) of
the final Treasury Department regulations issued pursuant to Section 409A.

 

F. Timing of Payments. For the purposes of this Section
VII, payment within 75 days following a specified payment date shall be deemed
to constitute payment on the specified
payment date.

 

 

VIII.
RETURN OF OR REDUCTION IN THE LONG-TERM INCENTIVE COMPENSATION AWARD

 

In the event that following the end of the
Award Period, it is determined by the Committee and ratified by the Board of
Directors that a Long-Term Incentive
Compensation Award was, in whole or in part, based on incorrect data (including
financial results which pursuant to applicable laws, roles, regulations
or applicable accounting principles are required to be restated), the
Participant shall return to the Company the Overpayment Amount, where the
Overpayment Amount shall be equal to the Long-Term Incentive Compensation Award
distributed to the Participant, reduced by the Long-Term Incentive Compensation
Award the Participant would have received
had the correct data been used in the calculation of the Long-Term Incentive
Compensation Award, as determined by the Committee in good faith. The
determinations made by the Committee and ratified by the Board of Directors
pursuant to this Section shall be conclusive and binding on the Participant
unless reached in an arbitrary and capricious manner.

IX.
SPECIAL AWARDS AND OTHER PLANS

 

Nothing contained in the Plan shall
prohibit the Company or any of its subsidiaries from granting special
performance or recognition awards, under such conditions
and in such form and manner as it sees fit, to employees (including
Participants) for meritorious service of any nature. In addition, nothing
contained in the Plan shall prohibit the Company or any of its
subsidiaries from establishing other incentive compensation plans providing for
the payment of incentive

compensation to employees (including
Participants).

 

X. ADMINISTRATION,
AMENDMENT AND INTERPRETATION OF THE PLAN

 

A.  Amendment and Termination.  The
Board of Directors shall have the right to amend the Plan from time to time or
to repeal it entirely or to direct the discontinuance of Long-Term Incentive
Compensation Awards either temporarily or permanently; provided, however, that
no amendment of the Plan shall operate to annul a Long-Term Incentive
Compensation Award with respect to an Award Period in effect at the time of the
amendment. Notwithstanding the foregoing,
and subject to Section VII. C., in the event this Plan is terminated before the
last day of an Award Period, Long-Term Incentive Compensation Awards
payable for such Award Period will be prorated on the basis of the ratio of the
number of weeks in such Award Period prior to such termination to the aggregate
number of weeks in such Award Period and will be based on the attainment of
Performance Goals with respect to the applicable Performance Measures and paid only after the end of such Award Period in
accordance with Section VI above which will be deemed to continue until the
expiration thereof as if this Plan had not been terminated. .

 

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 B. Administration. The Committee
shall determine the parameters necessary to grant Long-Term Incentive
Compensation Awards, including Award Periods,
Performance Measures, Performance Goals and the amounts of Long-Term Incentive
Compensation Awards with respect to each Performance Goal. The Committee
shall have full authority to administer the Plan, including authority to
interpret and construe any provision of the Plan and the terms of any Long-Term
Incentive Compensation Awards issued under it and to adopt such rules and
regulations for administering the Plan as it may deem necessary. Decisions of
the Committee shall be final and binding on all parties and all decisions,
determinations, selections and other actions permitted or required to be taken
or made by the Committee with respect to the Plan shall be subject to the
absolute discretion of the Committee.

 

C.
Delegation to Officers or Employees.  The
Board of Directors and the Committee, as applicable, may designate officers or
employees of the Company to assist the Committee in the administration of the
Plan.

M. MISCELLANEOUS

 

A.  Expenses. All expenses and costs in connection with the
operation of the Plan shall be borne by the Company (including any employment
taxes which applicable law requires the Company to pay).

 

B.  Taxes. All Long-Term Incentive Compensation Awards under the
Plan are subject to withholding, where applicable, for federal, state and local
taxes.

 

C.  Unsecured Obligation. Unless otherwise determined by the Committee, all Long-Term
Incentive Compensation Awards will be paid from the Company's
general assets, and nothing contained in this Plan will require the Company to
set aside or hold in trust any funds for the benefit of any Participant, who
will have the status of a general unsecured creditor of the Company.

 

D.  No Right to Employment. This Plan will not confer upon any Participant any
right with respect to continuance of employment or other service with the Company or any subsidiary, nor will it interfere
in any way with any right the Company or any subsidiary would otherwise have to
terminate or modify the terms of such Participant's
employment or other service at any time.

 

E.   No Assignment, Alienation.
Except as otherwise provided in this Plan, no right or benefit under this Plan
will be subject to anticipation, alienation, sale, assignment, pledge,
encumbrance, or charge, and any attempt to anticipate, alienate, sell, assign,
pledge, encumber, or charge such right or benefit will be void. No such right
or benefit will in any manner be liable for or subject to the debts,
liabilities, or torts of a Participant.

 

F.   
Separate
Provisions. If any provision in this Plan is held to be invalid or
unenforceable, no other provision of this Plan will be affected thereby.

 

G.   Applicable Law. This Plan will be governed by and construed in
accordance with applicable United States Federal law and, to the extent not
preempted by such Federal law, in accordance with the laws of the State of
California, without giving effect to the principles of conflict of laws
thereof.

 

H.   Liability for the Long-Term
Incentive Compensation Awards. Only
the entity for which the Participant performs services at the commencement of
the Award Period shall be liable with respect to the Long-Term Incentive
Compensation Award which relates to an Award Period.

 

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EXHIBIT
A

 

Participation Agreement for
____________________ for the award dated ____________

 

A.       Total Shareholder Return (TSR): 
(50% of Award)

 

The TSR
will be measured against the comparator companies as set forth in the Long-Term
Incentive Plan.

 

TSR
Award will be based as follows:

 

	
		Minimum

			
		Company TSR must be at the 40th
  percentile of comparator companies
	
		12.5% of Annual Base Pay at the
  end of fiscal year

	
		Target

			
		Company TSR must be at the 60th
  percentile of comparator companies
	
		25.0% of Annual Base Pay at the
  end of fiscal year

	
		Maximum

			
		Company TSR must be at the 75th
  percentile of comparator companies.
	
		37.5% of Annual Base Pay at the
  end of the fiscal year

If the minimum Performance Goal of 40th
percentile is not met, the amount payable is $0.00.  If the maximum Performance
Goal is exceeded, the amount payable will not exceed the amount set forth
above.  For performance between minimum and target Performance Goals and
between target and maximum Performance goals, the amount payable will be
determined based upon straight-line interpolation.

 

B.   Strategic Objectives (note – the objectives reflected
below are only examples and are not intended to be indicative of objectives for
each participant):  

 

1.  (Example) Turn around our Program
into a profitable business by achieving $3.0M Operating Income by end of fiscal
2013.

 

		
			 

				
			2010

				
			2013

			
	
			Operating Income

				
			$1.2M

				
			$3.0M

			
	
			Net Sales

				
			$18.4M

				
			$25.0M

			

 

 

2.  (Example) Achieve customer
satisfaction rating of 95% based on a third party survey.

 

 

3.  (Example) Achieve Net Sales of $30M
by the end of 2013.  Currently it is $18M.  This is an increase of 66% from
2010 year end results.

 

Award for strategic goals will be based on the following:
(50% of Award)

 

	
		Minimum

			
		Must meet at least 80% of established goals

			
		12.5% of Annual Base Pay at the
  end of fiscal year

	
		Target
  & Maximum
	
		Based on 100% achievement of established goals

			
		25.0% of Annual Base Pay at the
  end of fiscal year

	
		Maximum

			
		Based on 150% achievement of established goals

			
		37.5% of Annual Base Pay at the
  end of the fiscal year

If the minimum Performance Goal of
80% is not met, the amount payable is $0.00.  If the maximum Performance Goal
is exceeded, the amount payable will not exceed the amount set forth above. 
For performance between minimum and target Performance
Goals and between target and maximum Performance goals, the amount payable will
be determined based upon straight-line interpolation.

 

 

 

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Any amount payable as a Long-Term Incentive Compensation
Award pursuant to this Participation Agreement will be determined and paid
pursuant to, and subject to, the terms and conditions set forth herein and in
the Plan.  All terms and provisions of the Plan are incorporated herein and
made part hereof as if stated herein.  If any provision hereof and of the Plan
shall be in conflict, the terms of the Plan shall govern.  All capitalized
terms used herein and not defined shall have the meanings assigned to them in
the Plan.

 

 

	
		 

		I agree and understand these long term performance
  objectives.  

		 

		 

		 

		 

		 

		 

		Signature (Key Executive)

		 

		
	
		 

		Date:

		

 

 

 

 

 

 

 

 

-10-sfi8kex101101110.htm

Exhibit 10.1

Swordfish Financial, Inc. Announces the Execution of "Deed of Assignment" for Funds in the Amount of $265,000,000.00 USD

 

ROCKWALL, TX, May 4, 2010 (Marketwire) --

 

 

ROCKWALL, TX -- (Marketwire) -- 05/04/10 -- Swordfish Financial, Inc. (PINKSHEETS: SWRF), a Minnesota Corporation, announces the following current events have taken place.

 

 

On April 30th, 2010 Swordfish Financial entered in to a contract to provide financial management and investment services to facilitate the long term funding of a global clean water and food initiative. This program will span several countries and utilize the combined efforts of many of the World's most successful humanitarian operations. The funding of the first stage of this project will result in the transfer of ownership of a $265,000,000.00 USD cash account held at Credit Suisse Bank via deed of assignment to Swordfish Financial. In addition, a written commitment has been secured to fund the second phase of this project through the deed of assignment to Swordfish of a gold deposit account. Details of this funding will be made available upon issuance of the deed of assignment, projected to be within the next 30 days.

 

 

Michael Alexander, CEO of SWRF, stated, "The execution of this deed of assignment is just the beginning. It is the intention of the entities behind this funding to continue to utilize their vast economic resources to ensure that clean water and hunger relief is achieved on a global scale and Swordfish Financial, Inc. will be the mechanism to execute these plans Worldwide."

 

 

About Swordfish Financial, Inc.

 

 

Swordfish Financial, Inc.'s (PINKSHEETS: SWRF) primary revenue source will come from the recovery and/or margin of orphaned and dormant assets of high net worth individuals and companies held in financial institutions around the world.

 

 

SWRF will use a portion of the funds generated by our asset recovery efforts to finance small and medium sized organizations by providing asset based funding against marketable "income producing and/or marginable" assets provided those companies meet our eco-friendly or humanitarian criteria. SWRF's funding will enable these organizations to compete more effectively, improve operations and increase their shareholder value.

 

 

Forward-Looking Statements

 

 

This document contains forward-looking statements and information as that term is defined in the Private Securities Litigation Reform Act of 1995, and, therefore, is subject to certain risks and uncertainties. There can be no assurance that the actual results, business conditions, business developments, losses and contingencies and local and foreign factors will not differ materially from those suggested in the forward looking statements as a result of various factors, including market conditions, competition, advances in technology and other factors.

 

 

CONTACT:

Swordfish Financial, Inc.

Investor Relations

info@swordfishfinancial.com

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