EXECUTIVE STAFF F'97 BONUS PLAN MEASUREMENTS AND CRITERIA EXHIBIT 10.6
(1996 10-K)
Executive Staff Measurements:
The fiscal 1997 bonus plan for executive staff will consist of the following:
a) 50% API Return on Net Assets (RONA)
b) 50% API Earnings Per Share (EPS)
Supporting Definitions:
Average Net Assets or Average Quarterly Net Assets = Total assets - current
liabilities (debt excluded from current liabilities).
Earnings Per Share = Net Income / Average Number of Common Shares Outstanding
during the period.
Return on Net Assets = After Tax Income (excluding interest) / Average Net
Assets. (RONA is a financial indicator of the ability of the Company to
generate profits utilizing available assets in an efficient manner).
Bonus Measurement:
0% 100% 200%
(Target)
------------------------------------------
50% API Return on Net Assets 13.50% 15.00% 17.00%
50% API Earnings Per Share $ 2.40 $ 2.80 $ 3.00
Name Functional Area Proposed Bonus Payout @ 100%
- - -------------- ----------------------------- ------------------------------
Sim CEO $310,000
Arzbaecher CFO $100,000
Dorszynski Tax & Treasury $ 35,000
Knutson Technology $ 29,000
ENGINEERED SOLUTIONS MULTI-BUSINESS UNITS F'97 BONUS PLAN MEASUREMENTS
Multi-Business Unit Leader Measurements:
The fiscal 1997 bonus plan for Engineered Solutions multi-business unit leader
will consist of the following:
a) 80% Engineered Solutions CMM (1) (2)
b) 20% API Financial Results (RONA and EPS)
0% 100% 200%
(Target)
------- -------- --------
CMM $8.1 MM $9.25MM $11.2 MM
API Results 0 100% 200%
------- -------- --------
Payout $0 $110,000 $220,000
The business unit financial targets for fiscal 1997 have been established based
upon the business plans submitted by each business unit, current year Corporate
contribution requirements for profitability, and agreed upon long-term
investments.
(1) CMM = Operating Profit - (20% x Monthly Net Assets)
(2) Targeted bonus plan levels for CMM may be modified during the plan year
due to mergers and acquisitions.
DISTRIBUTED PRODUCTS MULTI-BUSINESS UNIT LEADERS F'97 BONUS PLAN MEASUREMENTS
F'97 Bonus Measurements:
a) 50% Individual Unit CMM (1) (2)
b) 30% Distributed Products CMM (1) (2)
c) 20% Applied Power Financial Results (RONA and EPS)
Boel
0% 100% 200%
(Target)
-------- -------- --------
Unit CMM (3) $15.5 MM $18.0 MM $22.0 MM
DP CMM (3) $17.5 MM $22.5 MM $28.5 MM
API Results 0 100% 200%
-------- -------- --------
Payout $0 $100,000 $200,000
Lecher
0% 100% 200%
(Target)
-------- -------- --------
Unit CMM $ 2.0 MM $ 4.5 MM $ 6.5 MM
DP CMM (3) $17.5 MM $22.5 MM $28.5 MM
API Results 0 100% 200%
-------- -------- --------
Payout $0 $95,000 $190,000
(1) CMM = Internal Operating Profit - (20% x Monthly Net Assets)
(2) Excludes carrying charge related to Asia Pacific/Japan.
(3) Targeted bonus plan levels for CMM may be modified during the plan
year due to mergers and acquisitions.
SINGLE BUSINESS UNIT LEADER F'97 BONUS PLAN MEASUREMENTS
Bonus Measurements for Wright Line:
100% Business Unit Operating Profit
1997 Target Objective - Wright Line $29.0 MM Operating Profit (1)
(92% improvement over F'96 includes
Everest acquisition)
Measures / Payout Scale
0% 100% 200% 300%
(Target)
-------- -------- -------- --------
Operating Profit $23.0 MM $29.0 MM $33.0 MM $36.0 MM
- - ---------------- -------- -------- -------- --------
Payout $0 $100,000 $200,000 $300,000
- - ---------------- -------- -------- -------- --------
(1) Based on Wright Line's internal operating profit (excludes acquisition
write-up amortization).