EXHIBIT 10.2
[INDUS INTERNATIONAL, INC. LOGO]
INDUS INTERNATIONAL
EXECUTIVE INCENTIVE COMPENSATION PLAN
AND
FORM OF PLAN AGREEMENT
CHIEF EXECUTIVE OFFICER AND
CHIEF FINANCIAL OFFICER
INCENTIVE PERIOD:
APRIL 1, 2004 - MARCH 31, 2005
MC Incentive Compensation Plan FY '05 PAGE 1
2/4/2005
[INDUS INTERNATIONAL, INC. LOGO]
1. PLAN PURPOSE
The Executive Incentive Compensation Plan (the "Plan") has been
established to provide performance incentives for the Chief Executive
Officer and Chief Financial Officer (each, an "Executive") of Indus
International, Inc. (the "Company" or "Indus"). Your participation in the
Plan reflects the importance of your position and the impact your
performance can have on the success of Indus. The purpose of the Plan is
to provide motivation to the Executives to achieve the financial targets
set forth below. The Plan is also an important part of your total
compensation package.
2. DEFINITION OF TERMS
AWARD - The payment that goes to Executive in the form of cash or
Restricted Stock. The Award is calculated as a percentage of the
Executive's base salary as of March 31, 2005.
COMPONENTS - The four (4) financial measurements identified below.
COMPONENT AWARD OPPORTUNITY - 25% of the Maximum Award Opportunity.
EXECUTIVE - The Chief Executive Officer or Chief Financial Officer who
executes this Plan document.
MAXIMUM AWARD OPPORTUNITY - 100% of Executive's base salary as of March
31, 2005.
PLAN YEAR - April 1, 2004 - March 31, 2005. The Plan Year is also referred
to as fiscal 2005 or FY'05.
RESTRICTED STOCK - The portion of an Award, if any, payable in restricted
stock to be issued under the Company's 2004 Long-Term Incentive Plan. Any
Restricted Stock issued as part of an Award will have a three year vesting
period vesting one-third per year on each of the first three anniversary
dates.
TARGETS - The financial targets for each of the four (4) Component
categories identified below.
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[INDUS INTERNATIONAL, INC. LOGO]
3. AWARD COMPONENTS AND TARGETS:
COMPONENTS AND WEIGHTING - Your Award will be based on four Components,
weighted as follows:
COMPONENTS COMPONENT AWARD OPPORTUNITY
---------- ---------------------------
RECOGNIZED SOFTWARE LICENSE FEES 25%
ADJUSTED OPERATING INCOME(1) 25%
TOTAL RECOGNIZED REVENUE 25%
CASH BALANCE AT 3/31/05 25%
(1)Adjusted Operating Income means the Company's Operating Income, less
any Board approved restructuring expenses, and prior to any management
bonuses.
FY'05 TARGETS BY COMPONENT:
% OF COMPONENT AWARD
COMPONENTS TARGETS OPPORTUNITY
---------- ------- --------------------
RECOGNIZED SOFTWARE LICENSE FEES * 33%
* 67%
* 100%
ADJUSTED OPERATING INCOME * 33%
* 67%
* 100%
TOTAL RECOGNIZED REVENUE * 33%
* 67%
* 100%
CASH BALANCE AT 3/31/05 * 33%
* 67%
* 100%
----------
* This material has been omitted pursuant to a request for confidential
treatment filed with the SEC, and this material has been filed separately with
the SEC.
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[INDUS INTERNATIONAL, INC. LOGO]
4. PAYMENT OF AWARD
- Executive will be eligible to receive an Award if Indus achieves any
one or more of the Targets set forth above.
- Determination as to whether a Target has been met will be based on
the Company's audited financial statements for FY '05.
- Amount of any Award payout is calculated as a percentage of
Executive's base salary at the end of the fiscal year, subject to
the weighting schedule for the Components and Targets set forth
above. The formula for determining payment for any Target that is
met shall be the product of the Maximum Award Opportunity multiplied
by the applicable % of the Component Award Opportunity, multiplied
by 25%.
- The Chief Financial Officer's Award will be prorated to reflect ten
(10) months of service during fiscal 2005 in accordance with his
employment agreement.
- The first 50% of Executive's Maximum Award Opportunity shall be
payable in cash, and the second 50% of Executive's Maximum Award
Opportunity shall be payable in Restricted Stock.
- Award will be paid, if at all, following the conclusion of FY'05 and
completion of the Company's FY'05 audit.
=> Payout anticipated on/or about May 31, 2005.
- Executive must be an employee of Indus when Awards are paid to be
eligible to receive the Award.
- In the event of any acquisition, divestiture or recapitalization
involving the Company the Compensation Committee of the Board of
Directors shall have the authority and discretion to adjust the
FY'05 Target in a manner that is equitable to the Company and the
Executive.
5. GENERAL AND ADMINISTRATIVE
A. No Award will be paid unless the Executive has executed a copy of this
Plan document acknowledging and accepting the terms set forth herein.
B. Nothing in this Plan document shall be construed to create or imply the
existence of a contract of employment between the Executive and the
Company. The terms and conditions of Executive's employment agreement
shall continue to govern the terms of his employment. Executive remains an
"at-will" employee and the Company can terminate his employment at any
time with or without cause. Participation in this Plan does not constitute
a promise of continued employment.
C. The Company, acting through the Compensation Committee of the Board of
Directors, shall have the authority to terminate, suspend, or amend this
Plan at any time with written notice to the Executive. Oral changes shall
not be valid.
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[INDUS INTERNATIONAL, INC. LOGO]
D. The Plan is established under the authority of the Compensation
Committee of the Board of Directors. If the Executive's employment is
terminated for any reason, this Plan shall terminate as to that Executive.
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[INDUS INTERNATIONAL, INC. LOGO]
E. This Plan is for the fiscal year ending March 31, 2005 only.
Participation during fiscal year 2005 does not mean that participation is
assured for subsequent fiscal years.
F. The Compensation Committee of the Board of Directors shall have the
discretion and authority to interpret this Plan. The Compensation
Committee's interpretation of the Plan, any Awards granted under the Plan,
and all decisions and determinations by the Compensation Committee with
respect to the Plan are final, binding and conclusive on all parties.
AGREEMENT
Your signature indicates your acknowledgment and acceptance of this
Compensation Plan.
Executive Indus International, Inc.
Name______________________ By /s/ Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxxx, Chairman of the
Compensation Committee of the Board of
Signature_________________ Directors
Date______________________ Date___________________
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