AXCA » Topics » Cash Incentives

This excerpt taken from the AXCA 6-K filed Feb 1, 2007.

Cash Incentives

 

The Named Executive Officers participate in the Corporation’s cash incentive compensation plan (“Cash Incentive Compensation Plan”), a program designed to maximize corporate and individual performance by establishing specific, ambitious operational and financial goals and providing financial incentives to employees based on their level of achievement of these goals. Cash incentives granted under the Plan require Committee and Board approval and are based upon an assessment of each individual’s performance, as well as the performance of the Corporation.

 

The Plan is intended to:

 

 

Motivate work performance and behaviour that supports the corporate goals;

 

Motivate employees to achieve high-quality, consistent, and balanced business results over the long term;

 

Reward individuals based on their contributions to the overall success of the Corporation; and

 

Provide a very competitive overall compensation opportunity so the Corporation can attract, retain and motivate top performing employees.

 

Target payouts under the Cash Incentive Compensation Plan are set as a percentage of salary, ranging from 60% for the President and Chief Executive Officer, to 45% for the other Named Executive Officers. In order for Named Executive Officers to receive incentive awards, certain individual and Corporation performance levels must be met. Individual employee performance is assessed through Axcan’s performance evaluation and development program (the “Performance Program”). The Performance Program is used globally across all business units thus enabling the Corporation to assess individual performance on a consistent basis. Individual performance goals are set forth at the beginning of the performance period and then measured by the Compensation Committee against what the individual actually achieves. Named Executive Officers are individually rated on a scale of outstanding, excellent, satisfactory, fair and unacceptable. In 2007, under the Corporation’s revised performance plan, Named Executive Officers will be individually rated on a scale of excellent, exceeds expectations, fully effective, needs improvement and far below expectation.

 

For purposes of the Cash Incentive Compensation Plan, the Corporation’s financial performance is based on net sales and operating income, weighted at 75% and 25% respectively, as measured against proposed target goals set at the beginning of the performance period. For any cash incentives to be paid, the Corporation must achieve a minimum of 80% of its set corporate financial targets. The minimum payout under the Cash Incentive Compensation Plan is zero. The maximum payout under the Plan is equal to 200% of the target payout. Based on the Corporation exceeding its financial goals in fiscal year 2006, cash incentive payments were paid to the Named Executive Officers at 125% of target levels.

 

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This excerpt taken from the AXCA 6-K filed Jan 27, 2006.

Cash Incentives

        The Named Executive Officers participate in the Corporation's Cash Incentive Compensation Plan, a program designed to maximize corporate and individual performance by establishing specific, ambitious operational and financial goals and providing financial incentives to employees based on their level of achievement of these goals. Cash incentives granted under the Plan require Committee and Board approval and are based upon an assessment of each individual's performance, as well as the performance of the Corporation.

21


        The Plan is intended to:

    Motivate work performance and behaviour that supports the corporate goals.

    Motivate employees to achieve high-quality, consistent, and balanced business results over the long term.

    Reward individuals based on their contributions to the overall success of the Corporation.

    Provide a very competitive overall compensation opportunity so the Corporation can attract, retain and motivate top performing employees.

        In order for Named Executive Officers to receive awards, certain individual and Corporation performance levels must be met. Individual employee performance is assessed through Axcan's Performance Evaluation and Development Program. The Performance Program is used globally across all business units thus enabling the Corporation to assess individual performance on a consistent basis. Individual performance goals are set forth at the beginning of the performance period and then measured by the Compensation Committee against what the individual actually achieves. Named Executive Officers are individually rated on a scale of Outstanding, Excellent, Satisfactory, Fair and Unacceptable.

        For purposes of the Cash Incentive Compensation Plan, the Corporation's financial performance is based on net sales and operating income, weighted at 75% and 25% respectively, as measured against proposed target goals set at the beginning of the performance period. For any cash incentives to be paid, the Corporation must achieve a minimum level of performance of its set corporate financial targets. Cash incentives are paid at reduced rates depending on the level of achievement of the corporate targets.

        Payouts for planned results to be achieved ("Target Payouts") under the Cash Incentive Compensation Plan are set as a percentage of salary, ranging between 25 and 45% for the Named Executive Officers. The minimum payout under the Cash Incentive Compensation Plan is zero. The maximum payout under the Plan is equal to 1.05% of the Target Payout. Based on the Corporation's performance, lower cash incentive payments were paid to the Named Executive Officers in fiscal year 2005 versus fiscal year 2004 with the exception of the outgoing CEO who received a cash incentive payment equal to the cash incentive paid in fiscal year 2004 in recognition of the leadership and guidance provided during the transition to a new CEO during the course of the year.

EXCERPTS ON THIS PAGE:

6-K
Feb 1, 2007
6-K
Jan 27, 2006

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