Quarterly Report — Form 10-Q
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10-Q Quarterly Report 31 164K
2: EX-3.1 Articles of Incorporation/Organization or By-Laws 60± 220K
3: EX-3.2 Articles of Incorporation/Organization or By-Laws 11± 42K
4: EX-10.1 Material Contract 5 20K
5: EX-12 Statement re: Computation of Ratios 2± 9K
6: EX-21 Subsidiaries of the Registrant 7± 32K
7: EX-27 Financial Data Schedule 2± 10K
8: EX-27.1 Restated Financial Data Schedule 2± 9K
9: EX-99.1 Miscellaneous Exhibit 1 8K
EX-10.1 — Material Contract
EX-10.1 | 1st Page of 5 | TOC | ↑Top | Previous | Next | ↓Bottom | Just 1st |
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HOUSEHOLD INTERNATIONAL
1998 KEY EXECUTIVE BONUS PLAN
HOUSEHOLD INTERNATIONAL
-----------------------
1998 KEY EXECUTIVE BONUS PLAN
-----------------------------
I. CONCEPT
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The Household International 1998 Key Executive Bonus Plan
(the "Plan") is a short-term incentive plan that is intended
to comply with Section 162(m) of the Internal Revenue Code
of 1986, as amended (the "Code"), and is designed to award
"performance based" compensation as determined in accordance
with that provision of the Code. Awards will be based solely
on the return on equity ("ROE") of Household International,
Inc. and its consolidated subsidiaries (the "Company")
provided, however, that the Compensation Committee of the
Board of Directors shall have the discretion to reduce any
participant's award based on (1) other financial performance
criteria of the Company or of certain subsidiaries or
business units of the Company; and (2) on an evaluation of
each participant's individual performance. Performance
goals and award opportunities will be determined prior to
the beginning of each Plan period (which will generally be a
calendar year), or at a later date as allowed by Internal
Revenue Service ("IRS") notice or regulation, by the
Compensation Committee and will be communicated to each Plan
participant.
II. PARTICIPATION
-------------
Participation in the Plan will be restricted to the key
executives of Household International, Inc. whose positions
are set forth on Attachment A hereto (which exhibit may be
changed at any time by the Compensation Committee).
Participants will share a bonus pool calculated as a
percentage of the net income of the Company as reported in
the audited financial statements of the Company, which net
income shall be calculated without regard to the bonuses to
be paid hereunder. The Compensation Committee will
establish the maximum bonus opportunity available to such
participant, stated as a percentage of the entire bonus
pool. The sum of the individual percentages of the pool
assigned to each participant will not exceed 100 percent.
Any changes in the key executives participating in the Plan
will be made by the Compensation Committee.
III. LEVEL OF AWARDS
---------------
The bonus pool will equal 5% of the portion of the Company's
net income that exceeds the amount of net income that would
have resulted if a 12% ROE had been achieved. Thus, unless
actual ROE exceeds 12%, the amount of the bonus pool will be
zero. For purposes of this Plan, the Company's net income
means the consolidated net income of the Company pursuant to
its audited financial statements. ROE shall be calculated
by taking the amount of net income determined as above, and
dividing it by the average common shareholders' equity for
the year, excluding any adjustments related to investment
securities under FASB 115. Prior to each Plan period (or at
a later date as allowed by IRS notice or regulation), the
Compensation Committee of the Board of Directors may
establish a dollar cap for the bonus pool. In addition, and
within that same timeframe, the Compensation Committee will
establish the percentage of the bonus pool that will be
allocated to each participant. However, no more than 50% of
the bonus pool for any Plan year may be allocated to any one
participant, and the sum of the bonus pool percentages which
are allocated to all participants shall not exceed 100%.
Prior to each Plan period (or at a later date as allowed by
IRS notice or regulation), the Chief Executive Officer
("CEO") of the Company will recommend for approval by the
Compensation Committee the minimum ROE objective that must
be met, in order to pay bonuses under this Plan to any
participant at that participant's allocated bonus pool
percentage level. This minimum ROE objective will not be
less than 12%.
If the Compensation Committee approves the aforementioned
minimum ROE objective, this objective shall be deemed to be
established for the applicable participant for the
applicable Plan period and shall be deemed to be part of
this Plan for said Plan period. Subject to the Compensation
Committee's negative discretion described in the next
paragraph, attainment of the minimum ROE objective will
entitle the participant to his/her allocated percentage of
the bonus pool.
The CEO will also recommend for approval by the Compensation
Committee certain other financial performance indicators for
the Company or one or more subsidiaries or business units
and/or individual goals, which may include specific targets
for financial performance goals, which the Compensation
Committee may, in its sole discretion, take into account
solely for purposes of determining whether it should reduce
or eliminate the bonus otherwise due to a participant by
virtue of the Company having met the participant's minimum
ROE objective. The exercise by the Compensation Committee
of this negative discretion with respect to one participant
may not result in an increase in the amount of bonus payable
to another participant.
IV. DETERMINATION OF AWARDS
-----------------------
A. Approval of Goals/Awards
------------------------
The Compensation Committee of the Board of
Directors must approve the minimum ROE objective prior
to the beginning of any Plan period for all
participants in the Plan (or at a later date as allowed
by IRS notice or regulation). This goal will be the
sole criteria for measuring performance and determining
the bonus for that period. The Compensation Committee
will solely determine whether the minimum ROE objective
has been satisfied for all participants in the Plan, as
well as the total amount of the bonus pool, and prior
to payment of any bonus hereunder will certify in
writing as to the satisfaction of the minimum ROE
objective and the amount of the bonus pool to the Board
of Directors of the Company.
Notwithstanding anything contained herein to the
contrary, the Compensation Committee may, however, at
its sole discretion, reduce bonus awards in light of
other financial performance indicators, individual
performance of the participant, overall business
conditions or other circumstances.
V. PAYMENT OF AWARDS
-----------------
Awards will be paid as soon as practicable at the
end of the Plan period, subject to all required tax
withholdings. Awards may be paid in cash, shares of
the Company's common stock, or some combination thereof
at the sole discretion of the Compensation Committee.
VI. ADMINISTRATIVE MATTERS
----------------------
A. Position Changes
----------------
Normally awards, provided the goals have been met,
will be pro-rated according to the portion of the Plan
period that an incumbent is eligible for the bonus.
However, the Compensation Committee shall have the
right to review each individual case and take such
action as it deems appropriate consistent with the
intent and purposes of this Plan.
B. Effect on Benefits
------------------
Payments made under this Plan shall be included in
an employee's income for purposes of determining
pension benefits, life insurance, long-term disability,
and participation in the Company's TRIP plan.
C. Termination of Employment
-------------------------
Normally awards, provided the goals therefore have
been met, will be pro-rated in the case of death,
permanent and total disability, or retirement under one
of the Company's pension plans during a Plan period.
If a participant terminates employment for any other
reason prior to the last working day of a Plan period,
he will normally forfeit any right to an award for the
Plan period. Notwithstanding the foregoing, however,
the Compensation Committee shall have the right to
review each individual case and take such action as it
deems appropriate consistent with the intent and
purposes of this Plan.
D. Administration of the Plan
--------------------------
The Plan shall be administered solely by the
Compensation Committee. Any and all determinations
made by the Compensation Committee in connection with
this Plan shall be final and binding on the Company and
each participant in the Plan. Neither eligible
participation in the Plan, nor award payments
thereunder shall guarantee an employee any right to
continued employment. The Plan does not give any
employee a right or claim to an award under the Plan.
The Compensation Committee reserves the right to change
or discontinue the Plan at any time; provided, however,
that any new factors used to establish a goal, other
than ROE, or any change in the formula used to
calculate the amount of the bonus pool, must be
approved by the stockholders of the Company.
E. Stockholder Approval
--------------------
The Plan shall be submitted to the stockholders of
the Company at the 1998 annual meeting of stockholders.
If the Plan is not approved by the stockholders by
December 31, 1998, then this Plan shall be deemed to be
null and void and any awards or grants made pursuant
hereto shall automatically terminate. Thereafter, this
Plan shall again be submitted to the stockholders for
approval every fifth (5th) year or as may be required
by the applicable provisions of the Code.
H:\OS\BOARD\98KEBP.WP (as approved by stockholders on 5/13/98)
Attachment A
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1998 KEY EXECUTIVE BONUS PLAN POSITIONS
Chief Executive Officer
Chief Operating Officer
Group Executive
Executive Vice President
Senior Vice President
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
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This ‘10-Q’ Filing | | Date | | First | | Last | | | Other Filings |
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| | |
| | 12/31/98 | | 4 | | | | | 10-K |
Filed on: | | 8/14/98 | | | | | | | 8-K |
For Period End: | | 6/30/98 | | | | | | | 8-K |
| List all Filings |
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