Accelrys (ACCL)

Variable Bonuses

The Human Resources Committee believes that a substantial portion of the annual compensation of each executive should be in the form of variable incentive pay designed to emphasize the attainment of Accelrys’ corporate goals. The executive officer bonus plan is benchmarked against bonus practices of peer high-technology companies. Achievement under the plan applies a pre-determined formula to the achievement of profitability, revenue and order levels along any additional applicable performance measures as approved by the Human Resources Committee to determine the bonus pool. In addition, our officers and directors may participate in our executive deferred compensation plan (the “EDC Plan”). Under the EDC Plan, participants may defer, on a pre-tax basis, up to 90% of their base salary and 100% of all other forms of compensation, and contribute such amounts to the EDC Plan. At our discretion, we may make matching contributions under the EDC Plan of up to $5,000 per participant, such contributions vesting ratably over three years, contingent upon continued service. We will also make a bonus employer contribution of one percent of each participant’s base salary or annual retainer, as appropriate, for each one percent that our stock outperforms the Russell 2000 Index, up to a maximum of twenty percent. The bonus employer contribution vests ratably over three years, contingent upon continued service. No matching or bonus employer contributions were made to the EDC Plan during fiscal year 2006.

Variable Bonuses

        The Human Resources Committee believes that a substantial portion of the annual compensation of each executive should be in the form of variable incentive pay designed to reinforce the attainment of the Company's goals. The executive officer bonus plan is benchmarked against bonus practices of peer high-technology companies. A pre-determined formula, which takes into account profitability against the annual plan approved by the Board, is used to determine the bonus pool. The individual executive officer's share of the bonus pool is based upon the Human Resources Committee's assessment of each officer's performance during the prior fiscal year and is benchmarked against bonus practices of peer high-technology companies.