Pre-Effective Amendment to Registration of Securities Issued in a Business-Combination Transaction — Form S-4
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-4/A Wci Communities, Inc. Etal 264 1.25M
2: EX-10.5 Non-Employee Directors' Stock Incentive Plan 8 41K
3: EX-10.6 Stock Purchase and Option Plan 8 41K
4: EX-10.7 Management Incentive Compensation Plan 8 39K
5: EX-12.1 Statement Re Computations of Ratios 1 18K
6: EX-23.2 Consent of Pricewaterhousecoopers LLP 1 16K
7: EX-23.3 Consent of Kpmg LLP 1 17K
EX-10.7 — Management Incentive Compensation Plan
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EXHIBIT 10.7
THE
WCI COMMUNITIES, INC.
(WCI)
MANAGEMENT INCENTIVE
COMPENSATION PLAN
(MICP)
JANUARY 1, 2001
WCI COMMUNITIES, INC.
MANAGEMENT INCENTIVE COMPENSATION PLAN
PAGE 2
I. OBJECTIVE
The WCI Communities, Inc., ("WCI" or "Company") Management Incentive
Compensation Plan (the "MICP" or "Plan") was established to reward the
performance of those key employees whose efforts significantly impact
WCI's achievement of its annual financial goals. The Plan will place
emphasis on differentiating performance among our diverse businesses
while maintaining a consistent reward theory and a common focus on
achieving our financial and non-financial objectives. This Plan is also
designed to provide significant financial rewards to participants when
such objectives are met or exceeded, (a "Bonus"). However, through a
"pay-for-performance" structure, the Plan will generate reduced or no
incentive payment when objectives or financial goals are not met.
II. PARTICIPATION
A Plan participant must be a) an officer of WCI or b) an employee whose
position has been identified as having significant value towards WCI
achieving its financial goals (a "Participant").
Newly hired employees will not be eligible for participation in the
Plan until they have completed at least eighteen (18) months of
employment. Employees with less than eighteen (18) months of service
may become a Participant provided they meet all of the following
criteria:
(i) They meet either a) or b) above, and
(ii) Have been employed for at least six (6) months prior to
payment, and
(iii) Their participation in the Plan had been approved in advance
by the Chief Executive Officer of the Company. Such approval
would generally be received at the time of negotiating
employment terms with the employee.
III. VESTING
Termination of employment prior to a payment date will result in the
loss of the entire Bonus award. Discretionary bonuses and pro-rated
bonuses may be given with the approval of the Chief Executive Officer.
IV. BONUS AMOUNTS AS A PERCENT OF SALARY
A Participant's potential maximum Bonus amount, (as a percent of base
salary), will be established within the following ranges:
[Download Table]
% OF SALARY
-----------
President/Chief Operating Officer Up to 100%
Senior Vice Presidents/Division Presidents 40% - 100%
Vice Presidents/Directors/Controllers 20% - 30%
Other Key Managers 10% - 20%
WCI COMMUNITIES, INC.
MANAGEMENT INCENTIVE COMPENSATION PLAN
PAGE 3
V. PARTICIPANT CLASSIFICATION
Based on a Participant's position within WCI, each Participant will be
classified as a member of one of the following groups:
(i) Corporate Administrative Personnel
(ii) Home Building Personnel
(iii) Division Operating Personnel
VI. OBJECTIVES
The amount of each Participant's Bonus shall be determined based on a
combination of, (i) the Participants Bonus amount as percent of base
salary, (ii) the group within which the Participant is classified and,
(iii) achievement of one or more of the following objectives: Corporate
Financial Objectives and Division/Project Objectives.
The matrix of a Participant's classification and objectives upon which
a Bonus shall be determined is as follows:
FOR 2001, THE MICP ALLOCATIONS ARE THE FOLLOWING:
[Enlarge/Download Table]
DIVISION/PROJECT
OBJECTIVES AND/OR
CLASSIFICATION CORPORATE FINANCIAL OBJECTIVES PERSONAL OBJECTIVES
-------------- ------------------------------ -------------------
Corporate Administrative Personnel 100% 0%
Home Building Personnel 20% 80%
Division Operating Personnel 20% 80%
VII. ACHIEVEMENT MEASUREMENT
A. CORPORATE ADMINISTRATIVE PERSONNEL
Each Corporate Administrative Personnel Participant shall be eligible
to receive incentive compensation, paid on their individual Bonus
target amount as a percent of base salary in the event the Corporate
Financial Objective has been achieved.
The Corporate Financial Objective is a combination of two (2)
measurements of the financial performance of WCI.
(i) Net Income
(ii) Return on Capital-earnings before interest, taxes,
depreciation, and Amortization divided by total capital
deployed at the end of the period. Total capital includes the
sum of debt--- excluding non-monetary liabilities such as
payables and accruals, plus equity--- including subordinated
debt, as defined in SEC terms.
WCI COMMUNITIES, INC.
MANAGEMENT INCENTIVE COMPENSATION PLAN
PAGE 4
WCI must meet at least eighty (80%) of the Net Income and Return on
Capital, weighted as listed below, for each of the Corporate Financial
Objectives to be satisfied.
[Download Table]
100% of Net Income 75%
Achievement of 1st Quarter 3.75%
Achievement of 2nd Quarter 3.75%
Achievement of 3rd Quarter 3.75%
Achievement of 4th Quarter 3.75%
Achieve Cumulative YTD Net Income
Achievement at 1st Quarter 3.75%
Achievement at 2nd Quarter 3.75%
Achievement at 3rd Quarter 3.75%
Achievement at 4th Quarter 3.75%
Achievement of Annual Net Income 70%
100% of Annual Return on Capital 25%
----
100%
Since Net Income is the most important and most comprehensive measure
of current year performance, it will be the primary measurement and
will be weighted at 75% of the potential MICP award. Return on Capital
will be used as a secondary measurement that will motivate deployment
of resources judiciously. Specifically, the program will work as
follows:
NET INCOME -- 75% OF MICP POTENTIAL (ALL ACCELERATION OF
PAYOUTS WILL BE BASED UPON NET INCOME PERFORMANCE)
[Download Table]
ACTUAL ACHIEVED ACTUAL PAYOUT (% EARNED)
--------------- ------------------------
120% or higher of $94.46M 160%
101 to 119% 100% plus 3% for each $944.6k
above $94.46M
$94.46M 100%
80 to 99% of $94.46M 100% less 2% for each $944.6k
Below $94.46M
Less than 80% of $94.46M No payout
RETURN ON CAPITAL (R.O.C.) - 25% OF TOTAL MICP POTENTIAL
[Download Table]
ACTUAL R.O.C. ACTUAL PAYOUT (% EARNED)
------------- ------------------------
18% or higher 100%; multiplied by the
payout percentage awarded
on Net income performance
only if ROC is 100% or higher
14.4% to 17.% 60% plus 2% for each .15%
Achieved in excess of 12%
Less than 14.4% No payout
Any Corporate Administrative Personnel Bonus shall be payable to a
qualifying Participant in the first quarter of the following Plan year.
WCI COMMUNITIES, INC.
MANAGEMENT INCENTIVE COMPENSATION PLAN
PAGE 5
(See Exhibit A & AA for hypothetical example)
B. HOME BUILDING PERSONNEL
Each Home Building Personnel Participant shall be eligible to
receive incentive compensation, paid on their individual bonus
target amount as a percent of base salary in the event
targeted Division/Project Objectives and Corporate Financial
Objectives have been achieved.
Bonus Compensation payable to eligible Home Building Personnel
shall be calculated on an allocation weighted eighty (80%)
percent on Division/Project Objectives and twenty (20%)
percent on Corporate Financial Objectives.
(i) CORPORATE FINANCIAL OBJECTIVES (20% OF TOTAL TARGET)
The Company Financial Objective portion of the above
calculation, twenty (20%) percent of the total, is a
combination of two (2) measurements of the financial
performance of WCI, Net Income and Return on Capital. A
detailed explanation of the Corporate Financial Objective is
outlined in Section VII(A) above.
(ii) DIVISION/PROJECT OBJECTIVES (80% OF TOTAL TARGET)
The Division/Project Objective portion of the above
calculation, eighty (80%) percent of the total, is based on
the eligible participant meeting predetermined financial
objectives by job positions as listed below.
[Download Table]
FINANCIAL
TITLE COMMUNITY/DIVISION OBJECTIVES
----- ------------------ ----------
Division President/ Division Net Home Building
Financial Manager $ Contribution after Sales Overhead
Project Manager Community Net Home Building $ Contribution
after Sales Overhead
Land Manager/ Division Gross Margin $
Purchasing Manager
Production Manager Community Net Home Building $
Contribution before Sales Overhead
The bonus payment calculation will be structured as follows:
[Download Table]
100% of Net Contribution 80%
Achievement of 1st Quarter (Financial Objective) 3.75%
Achievement of 2nd Quarter (Financial Objective) 3.75%
Achievement of 3rd Quarter (Financial Objective) 3.75%
Achievement of 4th Quarter (Financial Objective) 3.75%
Achievement of 1st Quarter
Cumulative YTD (Financial Objective) 3.75%
Achievement of 2nd Quarter
Cumulative YTD (Financial Objective) 3.75%
Achievement of 3rd Quarter
Cumulative YTD (Financial Objective) 3.75%
Achievement of 4th Quarter
WCI COMMUNITIES, INC.
MANAGEMENT INCENTIVE COMPENSATION PLAN
PAGE 6
[Download Table]
Cumulative YTD (Financial Objective) 3.75%
Achievement of Annual (Financial Objective) 70%
----
Total 80%
(iii) In the event the Division/Project Objectives are not achieved
or are exceeded, the bonus payment will be paid according to
the following schedule:
[Download Table]
ACTUAL ACHIEVED ACTUAL PAYOUT
AGAINST PLAN (% EARNED)
------------ ----------
120% or higher 160%
101% to 119% 100% plus 3% for each %
over 100% to 119%
100% 100%
80% to 99% 100% less 2% for each %
under 100%
Less than 80% No Payout
(iv) The Corporate Financial Objectives payment will only be paid
if eighty (80) percent or more of the Division/Project
Objective is met, and eighty (80) percent of Corporate
Financial Objective is met. Payment will be made at the level
Division/Project Objective is met below one hundred (100)
percent and at whatever level Corporate payment is made if one
hundred (100) percent of Division/Project Objectives is met.
(See Exhibit B & BB for hypothetical example)
(v) The Corporate Financial and Division/Project Objective
Payments shall be paid to qualifying Participants in the first
quarter of the following Plan year.
C. DIVISION OPERATING PERSONNEL
Each Division Operating Personnel Participant shall be
eligible to receive incentive compensation, paid on their
individual Bonus target amount as a percent of base salary in
the event targeted Division/Project Financial Objectives and
Corporate Financial Objectives have been achieved.
Bonus compensation payable to eligible Division Operating
Personnel shall be calculated on an allocation based on two
(2) components weighted eighty percent (80%) on
Division/Project Objectives and twenty percent (20%) on
Corporate Financial Objectives.
(i) CORPORATE FINANCIAL OBJECTIVES (20% OF TOTAL TARGET)
The Company Financial Objective portion of the above
calculation, twenty (20%) percent of the total, is a
combination of two (2) measurements of the financial
performance of WCI, Net Income and Return on Capital. A
detailed explanation
WCI COMMUNITIES, INC.
MANAGEMENT INCENTIVE COMPENSATION PLAN
PAGE 7
of the Corporate Financial Objective is outlined in Section
VII(A) above.
(ii) DIVISION/PROJECT OBJECTIVES (80% OF TOTAL TARGET)
The eighty percent (80%) component is comprised of two (2)
separate factors. The weighting of these factors, which in the
aggregate represent a total of eighty percent (80%) of the
total target, shall be calculated as follows:
[Download Table]
100% of Net Contribution 80%
Achievement of 1st Quarter Net Contribution 3.75%
Achievement of 2nd Quarter Net Contribution 3.75%
Achievement of 3rd Quarter Net Contribution 3.75%
Achievement of 4th Quarter Net Contribution 3.75%
Achievement of 1st Quarter YTD
Cumulative Net Contribution 3.75%
Achievement of 2nd Quarter YTD
Cumulative Net Contribution 3.75%
Achievement of 3rd Quarter YTD
Cumulative Net Contribution 3.75%
Achievement of 4th Quarter YTD
Cumulative Net Contribution 3.75%
Achievement of Annual Net Contribution 70%
----
Total 80%
(iii) In the event the Division/Project Objectives are not achieved
or exceeded, the bonus payment will be paid according to the
following schedule:
[Download Table]
ACTUAL ACHIEVED ACTUAL PAYOUT
AGAINST PLAN (% EARNED)
------------ ----------
120% or higher 160%
101% to 119% 100% plus 3% for each %
over 100% to 119%
100% 100%
80% to 99% 100% less 2% for each %
under 100%
Less than 80% No Payout
(vi) The Corporate Financial Objectives payment will only be paid
if eighty (80) percent or more of the Division/Project
Objective is met, and eighty (80) percent of Corporate
Financial Objective is met. Corporate payment will be made at
the level Division/Project Objective is met below one hundred
(100) percent and at whatever level Corporate payment is made
if one hundred (100) percent of Division/Project Objectives is
met.
WCI COMMUNITIES, INC.
MANAGEMENT INCENTIVE COMPENSATION PLAN
PAGE 8
(See Exhibit C & CC for hypothetical example)
(v) The Corporate Financial and Division/Project Objective
Payments shall be paid to qualifying Participants in the first
quarter of the following Plan year.
VIII. FORM
Attached Exhibit "A"-2001 Individual and Department Incentive Bonus
Plan. The form is to be used to structure Participant participation.
IX. IMPACT ON BENEFITS
A Participant's Bonus may be used for contribution to the WCI
Communities 401(k) and Retirement Plan within legal limitations. This
contribution will also receive the applicable Company match.
X. APPROVALS
At the beginning of each year, the Chief Executive Officer or
President/Chief Operating Officer shall submit the proposed incentive
program for that year to the Compensation Committee of the Board of
Directors for its approval.
NOTE: THIS DOCUMENT IS TO INFORM THE EMPLOYEES OF POTENTIAL COMPENSATION BASED
ON THEIR PERFORMANCE AND PERFORMANCE OF THE COMPANY. ALL TERMS AND CONDITIONS OF
THIS PLAN MAY BE MODIFIED BY WCI FROM TIME TO TIME UPON NOTICE. THIS DOCUMENT IS
FOR INFORMATION PURPOSES ONLY AND IN NO WAY SHOULD BE CONSTRUED AS AN EMPLOYMENT
CONTRACT OR OTHER COMMITMENT TO CONTINUE YOUR EMPLOYMENT.
Dates Referenced Herein
| Referenced-On Page |
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| This ‘S-4/A’ Filing | | Date | | First | | Last | | | Other Filings |
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| |  |
| Filed on: | | 5/21/01 | | | | | | | None on these Dates |
| | 1/1/01 | | 1 |
| List all Filings |
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