Silgan Holdings (SLGN)

2008 Annual Cash Bonuses under Incentive Programs

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Table of Contents

Annual Cash Bonuses under Incentive Programs

All executive officers of the Company are eligible to receive annual cash bonuses, which are provided to enable the Company to attract and retain such officers and provide fair compensation taking into account responsibilities and relevant employment markets. Additionally, the Compensation Committee uses annual cash bonuses for executive officers to reward them for achieving the Company’s financial and non-financial goals. Executive officers of the Company are eligible for an annual cash bonus based on a percentage of their annual base salary, and that percentage is determined generally based on the person’s responsibilities.

Annual cash bonuses are paid to Mr. Allott under the Company’s Senior Executive Performance Plan. Currently, Mr. Allott is the only person that is a participant in the Senior Executive Performance Plan. Pursuant to the Senior Executive Performance Plan, Mr. Allott could be eligible for an annual cash bonus of up to 200% of his annual base salary, with such maximum amount of Mr. Allott’s annual cash bonus being set annually by the Compensation Committee. For 2007 and 2008, the Compensation Committee evaluated competitive data and approved a maximum annual cash bonus for Mr. Allott of up to 100% of his annual base salary. In setting the maximum amount of the annual cash bonus for Mr. Allott, the Compensation Committee bases its determination on its objective of retaining Mr. Allott and providing him with fair overall annual cash compensation taking into account his responsibilities and relevant employment markets.

At the beginning of each year, the Compensation Committee establishes a performance goal and a performance goal target for the Company for that year pursuant to the Senior Executive Performance Plan. Following such year, the Compensation Committee confirms the extent to which the performance goal target for such year was met. If the performance goal target was met, then the participant under the Senior Executive Performance Plan would receive the maximum amount of his annual bonus for which he was eligible for that year. If the performance goal target was not met, then the participant would receive a pro rata amount of the maximum amount of his annual bonus for which he was eligible for that year. For 2007, the performance goal established by the Compensation Committee under the Senior Executive Performance Plan was the earnings before interest, taxes, depreciation and amortization (EBITDA) of the Company and the performance goal target for the maximum amount of the annual bonus was the achievement of the EBITDA level of the Company for 2006, with the manner for calculating the amount of Mr. Allott’s annual bonus based on the following formula:

X multiplied by the Company’s EBITDA for 2007; with X being equal to a percentage,

the numerator of which is the maximum amount of Mr. Allott’s annual bonus and the

denominator of which is the Company’s EBITDA for 2006.

For 2008, the Compensation Committee set the performance goal for Mr. Allott under the Senior Executive Performance Plan as the EBITDA of the Company and the performance goal target for the maximum amount of his annual bonus as the achievement of the EBITDA level of the Company for 2007, with the manner for calculating the amount of his annual bonus being the same as in 2007. In setting the performance goal under the

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Senior Executive Performance Plan, the Compensation Committee chose the EBITDA of the Company because it believes that it is an important and accepted measure of performance of the Company.

Annual cash bonuses are paid to Mr. Lewis and, since his appointment to EVP Operations, Mr. Greenlee pursuant to their respective employment agreements on the same basis that they are paid to Mr. Allott under the Senior Executive Performance Plan. Pursuant to their employment agreements, each of Messrs. Lewis and Greenlee is eligible for a maximum annual cash bonus of up to 30% of his annual base salary.

The Compensation Committee has established annual bonus programs applicable to Messrs. Allott, Lewis and Greenlee that are different from the annual bonus programs applicable to the other executive officers of the Company because Messrs. Allott, Lewis and Greenlee assist the Compensation Committee in establishing the annual bonus programs for the other executive officers of the Company, including setting financial and non-financial goals under such programs and determining whether goals were met under such programs. The Compensation Committee believes it is important that it receive an unbiased view from members of top management in establishing such programs, and believes that the best way to accomplish this objective is to not have those assessing such programs participate in them so that these individuals have no conflict of interest. Additionally, the objectives of the annual cash bonus programs for Messrs. Allott, Lewis and Greenlee are to retain such individuals and provide them with fair overall annual cash compensation taking into account relevant employment markets, and such programs are not meant primarily as an award for short-term financial performance. The Compensation Committee believes that it is best for the Company that Messrs. Allott, Lewis and Greenlee focus more on long-term creation of shareholder value rather than short-term goals. Accordingly, the Compensation Committee establishes a performance goal target with respect to annual bonuses payable to Messrs. Allott, Lewis and Greenlee that, although not certain, should be attainable.

Annual cash bonuses are paid to participants in the incentive programs of the Company’s business segments based upon the achievement of certain financial goals and, in most years, certain non-financial goals. Participants in those programs, including those deemed to be executive officers of the Company, are viewed on a team basis for purposes of annual cash bonuses and establishing financial and non-financial goals for each business segment.

The financial goals for each business segment for a given year are established at the beginning of such year by the CEO, CFO and EVP Operations, or the Holdings Executives, subject to approval of the Compensation Committee. Budgeted earnings before interest and taxes (EBIT) of each business segment are used as the financial goal for such business segment. For 2007 and 2008, the budgeted EBIT for each business segment was set at an amount that reflected an improvement from the prior year’s EBIT for such business segment. Based on the recommendations of the Holdings Executives, the Compensation Committee determines the portion of annual cash bonuses that would be payable to managers of the business segments of the Company based on the financial goal. The Compensation Committee generally believes that at least a majority of the annual cash bonuses payable to managers of the Company’s business segments should be based on a financial goal. For 2007, 70%, 100%, 80% and 60% of the annual cash bonuses for managers of our metal food container business, plastic container business, domestic closures operations and international closures operations, respectively, was payable based on the financial goal. For 2008, 70%, 100%, 80% and 60% of the annual cash bonuses for managers of our metal food containers business, plastic container business, domestic closures operations and international closures operations, respectively, are payable based on the financial goal.

Non-financial goals for each business segment for a given year are established at the beginning of the year by the Holdings Executives in conjunction with the managers of such business segment, subject to approval of the Compensation Committee. Such non-financial goals are generally items that both the Holdings Executives and the managers of the particular business segment desire additional attention during the year. For 2007, the non-financial goals for our metal food container business were management development, market leadership, operating leadership, working capital management, selling, general and administrative cost management and financial reporting and controls and the non-financial goals for our closures segment were market leadership,

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operating leadership, working capital management, selling, general and administrative cost management and financial reporting and controls for the domestic closures operations and market leadership, establishment of a new sales office in a developing market, implementation of cost reduction programs, quality and implementation of a plastic closures strategy for the international closures operations. For 2008, the non-financial goals for each of the metal food container business and the domestic and international closures operations of the closures business are management development, market leadership, operational leadership, working capital management, selling, general and administrative cost management and financial reporting and controls. For 2008, the incentive program for our plastic container business is based entirely on the financial goal, as it was for 2007.

For 2007, managers of the Company’s business segments were eligible for an annual target bonus ranging from 20% to 40% of their annual salary if applicable goals were met, with such percentage for any particular person being largely based on such person’s responsibilities. For 2008, managers of the Company’s business segments are eligible for an annual target bonus ranging from 20% to 35% of their annual salary if applicable goals are met, with such percentage for any particular person being largely based on such person’s responsibilities. The amount of the bonus of each such manager is determined by a formula which calculates such bonus based on the percentage that the actual applicable financial level achieved represents of the applicable financial goal and, when applicable, based on whether non-financial goals were met, and such managers can receive up to two times their target bonus amount if financial and non-financial goals of the applicable business segment are far exceeded. Generally, however, the Compensation Committee is of the view that non-financial goals, by their nature, are extremely hard to attain at a level warranting two times payment of the amount of the target bonus applicable to such non-financial goals, and therefore realistically managers can expect to receive between 50 percent and 150 percent of the amount of their target bonus applicable to such non-financial goals.

The officers of Silgan Holdings, all of whom are executive officers of the Company, are also eligible to receive annual cash bonuses pursuant to an incentive program in which they participate (other than Messrs. Allott, Lewis and Greenlee). For 2007, Messrs. Beam and Gervais participated in the incentive programs for the metal food container business and plastic container business, respectively, since they were managers for such businesses. Bonuses under such program are calculated on the basis of a weighted average of the levels of bonuses paid under the incentive programs of the Company’s business segments, using each business segment’s percentage of the overall EBIT of the Company’s business segments as the basis for weighting. Such officers are eligible for an annual target bonus ranging from 30% to 40% of their annual salary, and they can receive up to two times their target bonus amount if the Company’s business segments far exceed their applicable financial and non-financial goals. Generally, however, the Compensation Committee is of the view that non-financial goals, by their nature, are extremely hard to attain at a level warranting two times payment of the amount of the target bonus applicable to such non-financial goals, and therefore realistically such officers can expect to receive between 50 percent and 150 percent of the amount of their target bonus applicable to such non-financial goals.

Annual Cash Bonuses under Incentive Programs

All executive officers of the Company are eligible to receive annual cash bonuses, which are provided to enable the Company to attract and retain such officers and provide fair compensation taking into account responsibilities and relevant employment markets. Additionally, the Compensation Committee uses annual cash bonuses for executive officers to reward them for achieving the Company’s financial and non-financial goals. Executive officers of the Company are eligible for an annual cash bonus based on a percentage of their annual base salary, and that percentage is determined generally based on the person’s responsibilities.

Annual cash bonuses are paid to Mr. Allott under the Company’s Senior Executive Performance Plan. Currently, Mr. Allott is the only person that is a participant in the Senior Executive Performance Plan. Pursuant to the Senior Executive Performance Plan, Mr. Allott could be eligible for an annual cash bonus of up to 200% of his annual base salary, with such maximum amount of Mr. Allott’s annual cash bonus being set annually by the Compensation Committee. For 2006, the Compensation Committee evaluated competitive data and approved a maximum annual cash bonus for Mr. Allott of up to 100% of his annual base salary. In setting the maximum amount of the annual cash bonus for Mr. Allott, the Compensation Committee bases its determination on its objective of retaining Mr. Allott and providing him with fair overall annual cash compensation taking into account his responsibilities and relevant employment markets.

During 2006, Messrs. Silver and Horrigan were also participants under the Senior Executive Performance Plan while they served as Co-CEOs of the Company. For 2006, the Compensation Committee approved a maximum cash bonus for each of Messrs. Silver and Horrigan of up to $278,282, which amount is a pro rated amount, based on the period of time that they served as Co-CEOs of the Company, of the maximum annual amount approved by the Compensation Committee.

At the beginning of each year, the Compensation Committee establishes a performance goal and a performance goal target for the Company for that year pursuant to the Senior Executive Performance Plan. Following such year, the Compensation Committee certifies the extent to which the performance goal target for such year was met. If the performance goal target was met, then the participants under the Senior Executive Performance Plan would receive the maximum amount of their annual bonus for which they were eligible for that year. If the performance goal target was not met, then the participants would receive a pro rata amount of the maximum amount of their annual bonus for which they were eligible for that year. For 2006, the performance goal established by the Compensation Committee under the Senior Executive Performance Plan was the earnings before interest, taxes, depreciation and amortization (EBITDA) of the Company and the performance goal target for the maximum amount of their annual bonus was the achievement of the EBITDA level of the Company for 2005. In setting the performance goal under the Senior Executive Performance Plan, the Compensation Committee chose the EBITDA of the Company because it believes that it is an important and accepted measure of Company performance.

Annual cash bonuses are paid to Mr. Lewis pursuant to his employment agreement on the same basis that they are paid to Mr. Allott under the Senior Executive Performance Plan. Pursuant to his employment agreement, Mr. Lewis is eligible for a maximum annual cash bonus of up to 30% of his annual base salary.

The Compensation Committee has established annual bonus programs applicable to Messrs. Allott and Lewis that are different from the annual bonus programs applicable to the other executive officers of the Company because Messrs. Allott and Lewis, as CEO and CFO of the Company, respectively, assist the Compensation Committee in establishing the annual bonus programs for the other executive officers of the Company, including setting financial and non-financial goals under such programs and determining whether goals were met under such programs. The Compensation Committee believes it is important that it receive an unbiased view from top management in establishing such programs, and believes that the best way to accomplish this objective is to not have those assessing such programs participate in them so that these individuals have no conflict of interest. The objectives of the annual cash bonus programs for Messrs. Allott and Lewis are to retain such individuals and provide them with fair overall annual cash compensation taking into account relevant

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employment markets, and such programs are not meant primarily as an award for short-term financial performance. Accordingly, the Compensation Committee establishes a performance goal target with respect to annual bonuses payable to Messrs. Allott and Lewis that, although not certain, should be attainable.

Annual cash bonuses are paid to participants in the incentive programs of the Company’s business segments based upon the achievement of certain financial goals and, in most years, certain non-financial goals. Managers of each business segment, including those deemed to be executive officers of the Company, are viewed on a team basis for purposes of annual cash bonuses and establishing financial and non-financial goals for each business segment.

The financial goals for each business segment for a given year are established at the beginning of such year by the Company’s CEO and CFO, subject to approval of the Compensation Committee. Budgeted earnings before interest and taxes (EBIT) of each business segment are used as the financial goal for such business segment. Based on the recommendations of the Company’s CEO and CFO, the Compensation Committee determines the portion of annual cash bonuses that would be payable to managers of the business segments of the Company based on the financial goal. For 2006, 70%, 67%, 80% and 60% of the annual cash bonuses for managers of our metal food container business, plastic container business, domestic closures operations and international closures operations, respectively, was payable based on the financial goal.

Non-financial goals for each business segment for a given year are established at the beginning of the year by the Company’s CEO and CFO, subject to approval of the Compensation Committee. For 2006, the non-financial goals for our metal food container business were management development, market leadership, operating cost leadership, working capital management, selling, general and administrative cost management and financial reporting and controls, the non-financial goal for our plastic container business was working capital management, and the non-financial goals for our closures segment were capital and facility growth plan, market leadership, operating leadership, working capital management, selling, general and administrative cost management and financial reporting and controls for the domestic closures operations and working capital management, safety achievement and certain individual goals for the international closures operations acquired during 2006.

If applicable goals are met, managers of the Company’s business segments are eligible for an annual target bonus ranging from 20% to 40% of their annual salary, with such percentage for any particular manager being largely based on such person’s responsibilities. The amount of the bonus of each such manager is determined by a formula which calculates such bonus based on the percentage that the actual applicable financial level achieved represents of the applicable financial goal and, when applicable, based on whether non-financial goals were met, and such managers can receive up to two times their target bonus amount if financial and non-financial goals of the applicable business segment are far exceeded.

The officers of Silgan Holdings, all of whom are executive officers of the Company, are also eligible to receive annual cash bonuses pursuant to an incentive program in which they (other than Messrs. Allott and Lewis) participate in. Bonuses under such program are calculated on the basis of a weighted average of the levels of bonuses paid to the managers of the Company’s business segments (including the international closures operations acquired during 2006), using each business segment’s percentage of the overall EBIT of the Company’s business segments as the basis for weighting. Such officers are eligible for an annual target bonus ranging from 30% to 40% of their annual salary, and they can receive up to two times their target bonus amount if the Company’s business segments far exceed their applicable financial and non-financial goals.