There are 2 incentive plans that pay cash bonuses - the incentive compensation plan and the long-term incentive plan.
The annual incentive plan is weighted 50% to financial performance goals and 50% to operational goals (O/T and baggage). This incentive plan could pay Parker as much as 100% of base salary.
The long-term incentive plan is entirely total stockholder return related - this is the one that would pay Parker 125% of base pay for middle of the pack performance and up to 200% of base pay maximum.
So Parker, for example, would get no more than 50% of base salary for meeting O/T and baggage goals but could get up to 300% of base salary for meeting financial and total stockholder return goals.
In other words, no more than 17% of Parker's potential "bonus" could come from O/T and baggage performance. The rest would come from financial and stock performance.
Jim
ps added: poor choice of words in that last paragraph. Potentially the only bonus paid could be for the operational measures, meaning that those would represent 100% of the bonus Parker receives but only 17% of the maximum he could have received had all goals been met.
