Document:

Exhibit 10.3

Exhibit 10.3

August 31, 2010

Personal and Confidential

Ms. Laurie F. Gilner

1548 Highland Valley Circle

Chesterfield, MO 63005

Dear Laurie:

The purpose of this letter agreement is to amend Section 1 of your offer letter, dated July
26, 2010 (the “Offer Letter”), to reflect our mutual understanding and agreement that your
employment with C.R. Gibson, LLC (“CRG”) will commence on September 2, 2010, rather than on
September 7, 2010 as set forth in the Offer Letter. Accordingly, we agree that effective
immediately Section 1 of the Offer Letter shall be amended in its entirety to read as follows:

1. Contract Term – The term of your employment will commence September 2, 2010 and
will end September 6, 2013, unless terminated earlier by you or by CRG at any time as
provided herein. Thereafter, your employment status with CRG will continue to be that of an
employee at-will, subject to termination by either you or CRG at any time.

In all other respects, the Offer Letter shall remain in full force and effect according to its
terms and conditions.

Please confirm your understanding of the foregoing provisions by executing the enclosed
counterpart of this letter and returning the executed counterpart to me.

Sincerely yours,

Christopher J. Munyan

Chairman and Chief Executive Officer

C.R. Gibson, LLC

The aforementioned is confirmed as of this 31th day of August, 2010:

	 	 	 
	 

Laurie F. Gilner

	 	 
	 
	 	 
	cc:   William G. Kiesling
	 	 

402 BNA Dr. Building 100, Suite 600, Nashville, TN 37217 / 615-724-2800exv10w1

Exhibit 10.1

SIGMATRON INTERNATIONAL, INC.

EMPLOYEE AND DIRECTOR BONUS PLAN

	1.	 	PURPOSE. The purpose of this Employee and Director Bonus Plan (the “Plan”) of SigmaTron
International, Inc., a Delaware Corporation (the “Company”), is to align stockholder, employee
and director objectives, motivate employees and directors to achieve above-average return on
investment based on Company and individual performance, and increase stockholder value.
	 
	2.	 	DEFINITIONS. Capitalized terms shall have the meanings ascribed in this Section 2 or as
otherwise defined in the Plan:

	 	a.	 	“Award Year” shall mean the fiscal year to which bonuses relate.
	 
	 	b.	 	“CEO” shall mean the Chief Executive Officer of the Company.
	 
	 	c.	 	“Committee” shall mean Compensation Committee of the Company.
	 
	 	d.	 	“Director” shall mean a member of the Board of Directors of the Company who is
not an employee of the Company.
	 
	 	e.	 	“GAAP” shall mean U.S. Generally Accepted Accounting Principles.
	 
	 	f.	 	“Net Assets Employed” shall mean the fiscal year monthly average of net
inventory plus net accounts receivable plus net fixed assets minus trade payables,
calculated on the last day of each month of the trailing 13 months.
	 
	 	g.	 	“Pre-Tax Income” shall mean income, as determined by GAAP, prior to the payment
of any bonus amount paid to employees or directors and payment of income tax.
	 
	 	h.	 	“RONA” shall mean the percentage derived from Pre-Tax Income divided by Net
Assets Employed.
	 
	 	i.	 	“Target” shall mean the level of RONA at which Participants become eligible for
100% of the bonuses under this Plan set forth in Exhibit I attached hereto, as
determined by the Board of Directors, from time to time. Until otherwise modified by
the Board of Directors, the initial Target equals 7.0% RONA.
	 
	 	j.	 	“Participant” shall mean all U.S. payroll non-union employees of the Company
and Directors.
	 
	 	k.	 	“Officer” shall mean any full-time Company employee with a corporate ranking of
Vice-President or higher.

	3.	 	ADMINISTRATION. Except as otherwise directed herein, the Committee shall administer and
interpret the Plan in accordance with its provisions. The Board of Directors shall have the
power to adopt, modify and revoke such rules for the administration, interpretation and
application of the Plan as are consistent therewith.

 

 

	4.	 	TIMING AND ELIGIBILITY REQUIREMENTS FOR BONUS PAYOUTS.

	 	a.	 	Bonuses pursuant to this Plan shall be calculated at the end of the Award Year
and paid once annually as soon as practicable after the Bonus Pool awards are
calculated and approved.
	 
	 	b.	 	To be eligible for a bonus pursuant to this Plan, each Participant must be a
Director or on the Company’s payroll on the last day of the Award Year and the day on
which the bonuses are paid, absent special circumstances approved by the Committee.

	5.	 	BONUS POOLS AND CALCULATION OF BONUS AWARD.

	 	a.	 	The aggregate bonus pool fund from which bonuses shall be awarded under this
Plan (“Bonus Pool”) shall be calculated according to the following:

	 	i.	 	Except as provided in 5.a.ii, if RONA is less than the Target
there shall be no Bonus Pool. If RONA is equal to or exceeds the Target, the
amount of the Bonus Pool shall equal the Bonus Pool Payout Percentage times
Pre-Tax Income. The “Bonus Pool Payout Percentage” shall equal the Target, and
shall be adjusted upwards by various percentage levels established by the Board
in its sole discretion to the extent RONA exceeds the Target. By way of
illustration, the initial Bonus Pool Payout Percentage shall equal 15% when
RONA equals 7%, increasing to 20% when RONA equals 21%, and 25% when RONA
equals or exceeds 26%. (See Exhibit I.)
	 
	 	ii.	 	If RONA equals 80% to 89% of the Target, the Bonus Pool shall
equal 10% of Pre-Tax Income. If RONA equals 90% to 99% of the Target, the
Bonus Pool shall equal 12.5% of Pre-Tax Income.

	 	b.	 	The Committee, in its sole discretion, may approve adjustments to Pre-Tax
Income or the Net Assets Employed for certain non-recurring, non-operating income or
expenses or balance sheet items that comprise Net Assets Employed. The Officer Bonus
Plan pool of $200,000, if paid, shall be deducted from Pre-Tax Income.
	 
	 	c.	 	The Bonus Pool shall be divided into two pools: (1) 80% of the Bonus Pool shall
be allocated to a fixed bonus pool (“Fixed Bonus Pool”); and (2) 20% of the Bonus Pool
shall be allocated to a discretionary pool (“Discretionary Pool”).

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	 	d.	 	Fixed Bonus Pool.

	 	i.	 	There are three categories of Participants for the Fixed Bonus Pool:

	 	A.	 	All Participants, except Officers, Directors,
and direct labor and certain indirect labor employees located in
California, who receive 35% of the Fixed Bonus Pool;
	 
	 	B.	 	All Officers, who receive 55% of the Fixed
Bonus Pool; and
	 
	 	C.	 	All Directors, who receive 10% of the Fixed
Bonus Pool.

	 	 	 	The CEO shall determine the makeup of category A Participants.

	 	ii.	 	Each Director shall be allocated an equal portion of Section
5.d.i.c.
	 
	 	iii.	 	Each category B Participant’s pro rata bonus award from the
Fixed Bonus Pool shall be dependent upon two factors: (A) 80% of the bonus
awarded to a category B Participant shall be based on an allocation factor of
percentage points based on position and responsibility; and (B) 20% shall be
based on achievement of individual objectives.
	 
	 	iv.	 	For category A, the Bonus Pool shall be allocated among
Participants as determined by the CEO. A bonus to any category A Participant
may be zero, in the discretion of the CEO. The allocation for category B
Participants shall be recommended by the CEO to the Committee, approved by the
Committee, and then communicated by the CEO to the category B Participants. A
bonus to category B Participants awarded pursuant to Section 5.d.iii.(A) shall
be made according to the formula provided herein and is not discretionary.
Bonuses to category B Participants pursuant to Section 5.d.iii. (B) may range
from 0-100% of the amount, in the discretion of the Committee. Any amounts not
awarded to category B Participants hereunder shall be transferred to the
Discretionary Pool.
	 
	 	v.	 	The CEO’s Objectives shall be established by mutual agreement
of the Committee and the CEO. The CEO shall establish objectives for category
B Participants, subject to the Committee’s approval.
	 
	 	vi.	 	Objectives shall be established for category B Participants as
soon as practicable after adoption of the Plan for the 2011 fiscal year and the
first quarter of each subsequent fiscal year which relates to a bonus award and
may, but need not, be identical from one Participant to another. Objectives
shall be based on one or more of the following factors, plus any other factors
the CEO deems relevant to the category A and B Participant’s performance: (a)
sales or revenue; (b) measurable achievement in quality, operation and
compliance initiatives; (c)

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	 	 	 	objectively determinable measure of non-financial operating and management
performance objectives; (d) economic value-added (as determined by the CEO
for category A Participants and the Committee for category B Participants);
(e) productivity; (f) expenses; (g) margins; (h) efficiency; and (i)
customer satisfaction.

	 	vii.	 	In the event a category B Participant’s employment with the
Company ceases for any reason so that he is not an eligible Participant as
provided in Section 4.b, his Fixed Bonus Pool allocation shall be transferred
to the Discretionary Pool.

	 	e.	 	Discretionary Bonus Pool

	 	i.	 	The purpose of the Discretionary Bonus Pool is to allow the
Committee and CEO the flexibility to reward Participants (other than Directors)
for extraordinary performance, to manage aggregate compensation inequities
should they develop, and to provide a source for awards to direct labor and
certain indirect labor employees located in California.
	 
	 	ii.	 	The CEO shall recommend to the Committee the bonus amounts, if
any, awarded to category B Participants from the Discretionary Bonus Pool. The
remainder of the Discretionary Bonus Pool, after Committee’s final
determination of bonus allocations to category B Participants, shall be awarded
to all other Participants, excluding Directors. The CEO, in his sole
discretion, shall determine which of these Participants shall receive a bonus
from the Discretionary Bonus Pool and in what amounts.

	 	f.	 	The aggregate amount allocated to the Bonus Pool in an Award Year shall be
distributed and paid out in its entirety.

	6.	 	EMPLOYMENT AND PLAN RIGHTS. This Plan shall neither be deemed to give any Participant the
right to be employed by the Company, nor impair the Company’s right to discharge any
Participant at any time, subject to the terms of an employment agreement between a Participant
and the Company, if any.

	7.	 	AMENDMENT, SUSPENSION OR TERMINATION. This Plan may be amended, suspended, or terminated, at
any time or from time to time, by the Board of Directors.

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