Document:

ShoreTel FY 2009 Executive Bonus Plan

  
 Exhibit 10.5

 ShoreTel FY 2009 Executive Bonus Plan 
 The purpose of the ShoreTel Executive Bonus Plan is to incentivize executives, including the CEO, to achieve key company objectives. Executives will have the opportunity to earn a cash bonus based on their individual
and departmental performance and the achievement of company objectives. The bonus plan applies to all executives, except as set forth in “Exceptions” below. To participate in the plan, an executive must be employed on a regular basis and
meet other requirements set forth below. 
 Company Objectives; Bonus Pool 
 The key measurement metrics are revenues, non-GAAP operating profit and customer satisfaction ratings (“Company Performance Targets”).
The goals for these three metrics will be established and approved by the Board of Directors near the beginning of each six-month fiscal period (July-December and January-June). The six-month targets will be recommended by the CEO and approved by
the Board of Directors near the beginning of each six-month period. The Board of Directors has discretion to modify the key measurement metrics and weighting thereof. 
 The total amount of incentive compensation available for distribution to participants under this bonus plan in each six-month period (the “Bonus Pool”) is equal to the product of (a) percentage
achievement of the Company Performance Targets (which may be subject to minimum and maximum percentages), and (b) the sum of each participant’s base salary for the six-month period multiplied by 45% (85% in the case of the CEO).

 Individual Target Levels 
 Payments to
participants are based on the size of the Bonus Pool and each participant’s individual performance rating. The actual amount paid to a participant is equal to the product of (a) percentage achievement of the Company Performance Target
(which may be subject to minimum and maximum percentages), (b) the participant’s base salary for the six-month period, (c) 45% (85% in the case of the CEO) and (d) the participant’s performance rating, as adjusted (which
could be zero, or could be subject to a maximum multiplier). 
 The CEO will have the discretion to recommend bonus payment allocations for
the executive officers, up to a maximum of 150% of the Bonus Pool. However, to prevent total bonus payments under this plan from exceeding the Bonus Pool, each participant’s performance rating is subject to downward adjustment to reflect
his/her achievement relative to the achievement of other participants. 
 Exceptions 
 SVP Worldwide Sales.    The SVP Worldwide Sales is not part of the Bonus Pool. The SVP Worldwide sales bonus arrangement
is a target of $250,000 per year, instead of 45% of base salary. The performance targets are based on revenues, expenses, and customer satisfaction and individual goals and objectives. The SVP Worldwide Sales bonus is paid quarterly. 
 VP Sales.    The VP Sales bonus is not part of the Bonus Pool. The VP Sales bonus arrangement is a target of $150,000
per year, instead of 45% of base salary. The performance targets are based on revenues, expenses, and customer satisfaction and individual goals and objectives. The VP Sales bonus is paid quarterly. 
 Plan Payout 
 Based on company performance for each six-month period, the CFO will compute the overall Bonus Pool for the executives. The CEO will recommend allocation of the Bonus Pool for all executives other than himself. For
the CEO, the Compensation Committee will review CEO performance against strategic company goals and objectives and recommend a bonus to the Board. The Compensation Committee of the Board of Directors will recommend to the Board all executive bonus
payments. The Board of Directors will approve the pool of funds payable to employees and directors and will approve the specific bonus payments to the executive officers, including the CEO. Payments will be made no later than the last day of the
2 1/2 month period following the end of the applicable six-month bonus period. 

 Other Provisions 
  

	 	•	 	 Participation in this plan is not an agreement (express or implied) between the plan participant and ShoreTel that the participant will be employed by ShoreTel for
any specific period of time, nor is there any agreement for continuing or long-term employment. The plan participant and ShoreTel each have right to terminate the employment relationship at any time for any reason. This at-will employment
relationship can only be modified by an agreement signed by the participant and CEO or VP of Human Resources. 

  

	 	•	 	 Any determination of performance, payment or other matter under this plan by the Board of Directors or Compensation Committee is binding.

  

	 	•	 	 This summary highlights the principle features of the ShoreTel Executive Bonus Plan, but does not describe every situation that can occur. The Board of Directors
retains the right to interpret, revise, modify or delete the plan at its sole discretion at any time. 

  

	 	•	 	 The executive must be employed in a full time capacity for at least three consecutive months in the six-month bonus period to be eligible to participate in the
executive bonus plan, and must be employed at the time bonuses are paid in order to receive a bonus. 

  

	 	•	 	 This plan is intended to be effective for at least fiscal year 2009, and shall remain in effect until amended or terminated by the Board of Directors.Unassociated Document

    

     

    REGENCY
AFFILIATES, INC.

     

    STOCK OPTION
AGREEMENT

     

    THIS
STOCK OPTION AGREEMENT (this “Agreement”) dated as of August 13, 2008 (the
“Grant Date”), is between Regency Affiliates, Inc., a Delaware corporation (the
“Company”), and Laurence S. Levy (the “Participant”), relating to options to
purchase shares of Stock, which options are granted under the Regency
Affiliates, Inc. 2003 Stock Incentive Plan, as amended (the
“Plan”).  Capitalized terms used, but not otherwise defined, in this
Agreement shall have the meanings ascribed to such terms in the
Plan.

     

    I.              Grant of Stock Option,
Option Price and Term.

     

    The
Company grants to the Participant a Non-Qualified Stock Option to purchase
50,000 shares of Stock of the Company (“Option Shares”) at a price of $4.20 per
share (“Option Price”), subject to the provisions of the Plan and the terms and
conditions herein.  The term of this Stock Option shall be a period of
10 years from the Grant Date unless earlier terminated as provided herein and in
the Plan (the “Option Period”).  Subject to the provisions contained
herein and in the Plan, the Stock Option shall become exercisable immediately
upon the Grant Date.

     

    The Stock
Option granted hereunder is designated as a nonqualified stock option which is
not transferable by the Participant except to a Family Member, as provided in
Section 4 of the Plan, or by will or the laws of descent and
distribution.

     

    II.             Exercise.

     

    The Stock
Option shall be exercisable during the Participant’s lifetime only by the
Participant (or his Representative), and after the Participant’s death only by a
Representative.  The Stock Option may only be exercised by the
delivery to the Company of a properly completed written notice, in form
satisfactory to the Committee, which notice shall specify the number of Option
Shares to be purchased and the aggregate Option price for such shares, together
with payment in full of such aggregate Option Price.  Payment shall
only be made as specified in the Plan.  If any part of the payment of
the Option Price is made in shares of Stock, such shares shall be valued by
using their Fair Market Value as of the date of exercise of the Stock
Option.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    The Stock
Option may not be exercised unless there has been compliance with all the
preceding provisions of this Section 2, and, for all purposes of this Agreement,
the date of the exercise of the Stock Option shall be the date upon which there
is compliance with all such requirements.  The Committee may deny any
method of exercise permitted hereunder if such method would result in liability
under Federal or state securities law to the Participant or the Company, result
in an expense charge to the Company or prevent the use of pooling of interest
accounting.

     

    III.           Payment of Withholding
Taxes.

     

    If the
Company is obligated to withhold an amount on account of any tax imposed as a
result of the exercise of the Stock Option, the Participant shall be required to
pay such amount to the Company, as provided in the Plan.  The
Participant acknowledges and agrees that he is responsible for the tax
consequences associated with the grant of the Stock Option and its
exercise.

     

    IV.           Changes in Company’s Capital
Structure.

     

    The
existence of this Stock Option will not affect in any way the right or authority
of the Company or its stockholders to make or authorize (a) any or all
adjustments, recapitalizations, reorganizations or other changes in the
Company’s capital structure or its business; (b) any merger or consolidation of
the Company’s capital structure or its business; (c) any merger or consolidation
of the Company; (d) any issue of bonds, debentures, preferred or prior
preference stock ahead of or affecting the Stock or the rights thereof; (e) the
dissolution or liquidation of the Company; (f) any sale or transfer of all or
any part of its assets or business; or (g) any other corporate act or
proceeding, whether of a similar character or otherwise.

     

    In the
event of a Change in Control or other corporate restructuring provided for in
the Plan, and the Committee shall take such actions, as are provided for in the
Plan.

     

    V.             Plan.

     

    The Stock
Option is granted pursuant to the Plan, and the Stock Option and this Agreement
are in all respects governed by the Plan and subject to all of the terms and
provisions thereof, all of which terms and provisions are made a part of and
incorporated in this Agreement as if they were expressly set forth
herein.  Any capitalized terms not defined in this Agreement shall
have the same meaning as is ascribed thereto under the Plan.  The
Participant hereby acknowledges receipt of a true copy of the Plan and the
Participant has read the Plan carefully and fully understands its
content.  In the event of any conflict between the terms of this
Agreement and the terms of the Plan, the terms of the Plan shall
control.

     

    VI.           Employment
Rights.

     

    No
provision of this Agreement or of the Stock Option granted hereunder shall give
the Participant any right to continue as a director of the Company or any
Affiliates, created and inference as to the length of directorship of the
Participant, affect the right of the Company or any Affiliates to terminate the
provision of services of the Participant, with or without Cause, or give the
participant any right to participate in any employee welfare or benefit plan or
other program (other than the Plan) of the Company or any
Affiliate.

     

    
      
         

      

      
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    VII.          Governing
Law.

     

    This
Agreement and the Stock Option granted hereunder shall be governed by, and
construed and enforced in accordance with, the laws of the State of Delaware
(other than its laws respecting choice of law), except to the extent Federal
laws would be mandatorily applicable.

     

    VIII.        
Waiver; Cumulative
Rights.

     

    The
failure or delay of either party to require performance by the other party of
any provision hereof shall not affect its right to require performance of such
provision unless and until such performance has been waived in
writing.  Each and every right hereunder is cumulative and may be
exercised in part or in whole from time to time.

     

    IX.           Notices.

     

    Any
notice which either party hereto may be required or permitted to give the other
shall be in writing and may be delivered personally or by mail, postage prepaid,
addressed to the Secretary of the Company, at its then corporate headquarters,
and the Participant at his address as shown on the Company’s records, or to such
other address as the Participant, by notice to the Company, may designate in
writing from time to time.

     

    [Remainder
of page intentionally left blank.  Signature page
follows.]

     

    
      
         

      

      
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    IN
WITNESS WHEREOF, the Company has caused this Stock Option Agreement to be duly
executed by an officer thereunto duly authorized, and the Participant has
hereunto set his hand, all as of the day and year first above.

     

    REGENCY
AFFILIATES, INC.

    

    
      
        	 	 	 	 	 
	
                /s/
      Neil N. Hasson

              	 	 	
                /s/
      Laurence S. Levy

              	 
	
                      
                  Name:
      Neil N. Hasson

                

              	 	 	
                Laurence
      S. Levy

              	 
	
                      
                  Title:
      Chief Financial Officer 

                

              	 	 	
                      
                  Participant

                

              	 

      

    

     

     

    
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