Document:

exv10w16

 

Exhibit 10.16

PEGASUS SOLUTIONS, INC.

2005 EXECUTIVE OFFICER BONUS PLAN SUMMARY

     Effective as of March 8, 2005, the Compensation Committee of the Board of Directors of Pegasus
Solutions, Inc. (the “Company”) established a bonus plan for 2005 pursuant to which the executive
officers are eligible to receive an annual cash bonus subject to the attainment of certain Company
and individual performance criteria during the 2005 fiscal year. The amount of the annual cash
bonus is based on a percentage of each executive’s annual salary, with the target amount per year
for each particular executive ranging from 25% to 100% of the executive’s annual base salary (the
“Target Bonus”). The specific percentage of the Target Bonus to be awarded an executive is based
upon a 2005 adjusted earnings per share (“adjusted EPS”) goal and the achievement of individualized
goals specific to each executive officer, such as improving customer satisfaction, delivering key
projects within timing and budget goals, managing and reducing certain expenditures, achieving
specific revenue goals and achieving specified growth goals with respect to certain service
offerings (the “Individualized Targets”). A percentage of the Target Bonus is attributable to the
adjusted EPS goal and each Individualized Target. Failure of the Company to achieve the adjusted
EPS goal or failure of the executive to achieve the Individualized Targets could result in
elimination or reduction of the bonus depending upon the percentage attributable to the unmet
performance criteria. The executive is eligible to receive a specified percentage of the Target
Bonus in excess of the Target Bonus in the event the executive satisfies all of the Individualized
Targets and the Company exceeds its adjusted EPS goal. Each of the current executive officers of
the Company listed in the Company’s proxy statement is eligible under the bonus plan. However,
there is no formal agreement with respect to each executive’s annual bonus, the payment of which is
ultimately discretionary as determined by the Compensation Committee. The Company uses adjusted
EPS in connection with the bonus plan because it believes this measure enables a more thorough
evaluation of the Company’s current performance as compared to past performance and provides a
better baseline for assessing the Company’s future earnings expectations.exv10w17

 

EXHIBIT 10.17

PEGASUS SOLUTIONS, INC.

2005 DIRECTOR COMPENSATION SUMMARY

     During 2005, Pegasus Solutions, Inc.’s (“Pegasus”) standard arrangements for Director
compensation include a payment of $15,000, payable in quarterly installments, for a non-employee
Chairman of the Board. All other non-employee Directors will receive $10,000, payable quarterly.
Additionally, during 2005, each non-employee Director will receive $2,500 for each Board of
Directors meeting attended in person and $1,250 for each Board of Directors meeting attended
telephonically. Each non-employee Director will also receive $1,000 for each committee meeting
attended in person and $500 for each committee meeting attended telephonically. Each Committee
Chairman will receive an additional $500 for each committee meeting attended in person and an
additional $250 for each committee meeting attended telephonically. Personal attendance or
telephonic attendance at informal Board of Directors and committee gatherings will be compensated
in the same manner as personal or telephonic attendance at formal Board of Directors and committee
meetings, as the case may be. Directors will also be eligible for reimbursement of all reasonable
expenses incurred while performing their duties as Directors of Pegasus.

     Non-employee Directors will also receive stock option grants as follows:

	 	•  	Options to purchase 20,000 shares of common stock of Pegasus at the closing
price on the date immediately preceding election as a Director. These options
will vest over a three year period, with 1/12 of the option shares vesting each
quarter during the Director’s term of office, and will have a ten-year term;
	 
	 	•  	An additional grant of 8,000 option shares at the closing price of the stock
on the day preceding each subsequent anniversary date of election to office.
These options will vest 25% each quarter during the Director’s term of office,
vesting in full in one year, and will have a ten-year term; and
	 
	 	•  	Such additional grants as may be awarded at the discretion of the
Compensation Committee of the Board of Directors of Pegasus (“Compensation
Committee”).

     During 2005, non-employee members of the Audit Committee of the Board of Directors of Pegasus
will receive annual retainer fees of $5,000 per member and $10,000 for the Chairman.

     All compensation stated above is subject to amendment at the discretion of the Compensation
Committee.exv10w18

 

Exhibit 10.18

Pegasus Solutions, Inc.

Executive Perquisite Plan

Plan Document

As Amended and Restated

February 28, 2005

Article 1.       Introduction: Plan Summary and Plan Objectives

	 	1.1  	Plan Summary: The Company’s Executive Perquisite Plan (the “Plan”) establishes
an Annual Benefit Amount to by paid to Participants, on a taxable basis, for Eligible
Benefits under the Plan.
Participation in the Plan will be determined annually.
	 
	 	1.2  	Plan Objectives: The objectives of the Plan are:

	 	(a)  	To attract and retain the high-quality key employees
required to successfully manage the Company’s business and
	 
	 	(b)  	To remain competitive within the employment market place.

Article 2.       Plan Definitions

	 	2.1  	“Administrative Committee” means the Compensation and Benefits Administrative
Committee of the Company; provided, however, that during any period the
Compensation and Benefits Administrative Committee is not constituted, the term
shall mean the Compensation Committee of the Board of Directors of the Company.
	 
	 	2.2  	“Company” or “Corporate” means Pegasus Solutions, Inc.
	 
	 	2.3  	“Participant” means an employee with the title of
Chief Executive Officer, President, Executive Vice President, Chief Information Officer, Senior Vice President of Service
Delivery and Operations, or Senior Vice President.
	 
	 	2.4  	“Plan Year” means January 1 through December 31 of each year.

Article 3.       Plan Administration

	 	3.1  	Responsibility of Administration: Overall Plan administration will be the
responsibility of the Administrative Committee, who may delegate specific authority to
various employees of the Company or any affiliate thereof.
	 
	 	3.2  	Eligible Benefits: Eligible Benefits under the Plan (“Eligible Benefits”) are limited to
expenses that are solely related to the benefit of Participant. For example, a
family membership to a country club is not considered an Eligible Benefit. However, a membership for the Participant only, or the portion of the family membership
related to the Participant, would be considered an Eligible Benefit.

	 	(a)  	Automobile:

	 	(i)  	Lease or purchase payments (including principal and interest);
	 	(ii)  	Insurance payments;
	 	(iii)  	Payments for repairs, maintenance, fuel;
	 	(iv)  	Inspection and registration payments; and
	 	(v)  	Other payments specifically related to the operation of an automobile.

 

			
	Pegasus Solutions, Inc.

Executive Perquisite Plan

Plan Document
	 	Page 2
	

	 	(b)  	Investment, Financial. Estate, and Tax Planning:

	 	(i)  	Payments for the provision of investment, financial, estate, and tax planning services;
	 	(ii)  	Payments for the preparation of tax filings and returns; and
	 	(iii)  	Other payments specifically related to the provision of investment, financial, estate, and tax planning.

	 	(c)  	Club Dues and Fees:

	 	(i)  	Country club membership dues and service and entertainment fees;
	 	(ii)  	Athletic club membership dues and service and entertainment fees;
	 	(iii)  	Non-membership service or access fees; and
	 	(iv)  	Other payments specifically related to club dues and service fees.

	 	3.3  	Annual Benefit Amount: The Annual Benefit Amount available each Plan Year to each Participant under the Plan is based on job title as follows:

	 	 	 	 	 	 	 	 	 
	 	(a	)	 	President and Chief Executive Officer
	 	$	45,000	 
	 	(b	)	 	Executive Vice President
	 	$	35,000	 
	 	(c	)	 	Chief Information Officer
	 	$	25,000	 
	 	(d	)	 	Senior Vice President of Service Delivery and Operations
	 	$	25,000	 
	 	(e	)	 	Senior Vice President
	 	$	15,000	 

	 	3.4  	Payment of Eligible Benefits

	 	(a)  	No Substantiation Required. Benefit Payment Automatic: No
substantiation of expenditures for Eligible Benefits is required. Eligible
Benefits will be automatically paid equally per pay period during the Plan
Year.
	 
	 	(b)  	Funding of the Plan: Each Participant’s Annual
Benefit Amount for the Plan
Year are included in that participant’s annual budget.
	 
	 	(c)  	Timing of Payments: Payment of Eligible
Benefits will be included in the
Participant’s paycheck during the Plan Year.
	 
	 	(d)  	Form of Payment: All payments will be paid
as a monetary award, less
applicable withholding requirements for taxes or other benefits.
	 
	 	(e)  	Changes in Eligibility: In the event that a Participant’s change of assignment or transfer within the Company results in a change in eligibility as a
Participant under the Plan, any benefits available under the Plan will be prorated for
the Plan Year based on that change in eligibility.

	 	3.5  	No Carry Over of Annual Benefit Amount: The Annual Benefit Amount
each year pertains to the current Plan Year only.
	 
	 	3.6  	Participant Leases. Notes Payable, and Other Agreements: Any lease, note
payable, or other agreement entered into by the Participant is the sole responsibility and liability of the Participant.

 

			
	Pegasus Solutions, Inc.

Executive Perquisite Plan

Plan Document
	 	Page 3
	

	 	3.7  	Taxation of Benefits and Other Withholding: Annual Benefit
Amounts paid will be treated as ordinary income and will be taxed and withhold from as such.
	 
	 	3.8  	General Provisions

	 	(a)  	The Board of Directors of the Company may, subject to any
right of approval
contained in any Participant’s employment agreement with the Company, alter, amend, or terminate the Plan
at any time or from time to time provided, however, in the event of termination of the Plan,
there will be a pro-rata payout of any Eligible Benefits as of the date of termination.
	 
	 	(b)  	Neither the Board nor the Company, nor the Administrative
Committee, nor any
officers, directors, or employees shall have any liability to any
Participant (or his/her estate) under the Plan or otherwise on account of any
action taken, or
not taken, in good faith by any of the foregoing persons with respect to
the business or operations of such entities notwithstanding the fact that
any such
action or inaction in any way whatsoever may adversely affect the value of any
awards, rights, or benefits of a Participant (or his/her estate) under the Plan.
	 
	 	(c)  	The Plan and all actions taken pursuant to the Plan shall
be governed by, and
construed in accordance with the laws of the State of Texas.
	 
	 	(d)  	The invalidity or unenforceability of any one of more
provisions of the Plan shall
not affect the validity or enforceability of any other provisions of the
Plan, which shall remain in full force and effect.
	 
	 	(e)  	The rights of Participants to participate in the Plan and
to receive benefits under
the Plan is governed by this Plan Document rather than in any summary or
other communication. In the event of any conflict between any summary or other communication
and the Plan, the Plan controls.
	 
	 	(f)  	Any Participant shall be entitled to a copy of the Plan upon request.
	 
	 	(g)  	Correspondence regarding the Plan should be sent to the
Corporate
Compensation and Benefits Department, Human Resources, Dallas, Texas, U.S.A.

IN TESTIMONY WHEREOF, PEGASUS SOLUTIONS, INC. has caused this instrument to be executed in its
name and on its behalf, by the officer thereunto duly authorized, this 28th day of
February 2005 effective as of February 28, 2005.

	 	 	 	 	 
	 	 	PEGASUS SOLUTIONS, INC.
	 
	 	 	 	 
	

	 	By:.	 	 
	

	 	 	 	 
	 
	 	 	 	 
	

	 	Name:
	 	
	

	 	 	 	 
	 
	 	 	 	 
	

	 	Title:

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