An AIP (Annual Incentive Plan) bonus clause typically outlines the conditions under which an employee is eligible to receive a performance-based bonus, usually tied to achieving specific individual, departmental, or company-wide goals within a fiscal year. This clause may detail criteria such as performance metrics, payout percentages, timing of disbursement, and any contingencies that could affect bonus eligibility or amounts.
“AIP Bonus” means the amount of the annual bonus for a given Performance Year payable to a Participant, as determined by the Administrator in accordance with the AIP Bonus Formula and in accordance with the terms and conditions of the AIP and the Bonus Formula Methodology approved by the Administrator for the applicable Performance Year. An AIP Bonus is not payable to a Participant until it is earned and vested in accordance with the terms of the AIP.
“AIP Bonus Formula” means, for a Performance Year, the methodology to be used to calculate the AIP Bonus for each Participant, as set forth in the Bonus Formula Methodology for such Performance Year. Application of the AIP Bonus Formula in the calculation of any AIP Bonus shall be subject to the terms and conditions of the AIP and the Bonus Formula Methodology for the applicable Performance Year.
Establishment of AIP Bonus Formula. Within the first ninety (90) days of the Performance Year, the Administrator shall establish the AIP Bonus Formula for the Performance Year.
The amount of a Designated Executive Officer’s Target Cash Bonus Award (consisting of the Corporate Goals Bonus Awards portion and Individual Goals Bonus Awards portion and after the determination of the amount of each such portion) that is to be paid to a Designated Executive Officer hereunder is referred to as the “AIP Bonus Payment”.
All AIP Bonus Payments will be made in the year following the completion of the annual performance period to which the AIP Bonus Payment relates. The actual payment to each Designated Executive Officer will be made as soon as practical after final certification of the underlying performance results and approval of such payment by the Compensation Committee;
To be eligible to receive an AIP Bonus Payment, a Designated Executive Officer must have been actively employed by the Management Company during the annual performance period with respect to which the payment relates.
AIP Bonus Payments will be paid-out on a one-time basis as a lump-sum, in cash, as such are considered compensation and reportable income for all tax reporting purposes.
AIP Bonus Payments are included in total annual earnings and may be taken into account under the Company’s other benefit programs in accordance with their terms.
This Annual Incentive Compensation Plan (“AIP”) is a cash incentive compensation plan adopted and established by the Compensation Committee of the Board of Directors of CBL & Associates Properties, Inc. (the “Company”).
If the amount of your 2023 AIP bonus based on actual achievement of the performance goals (as determined by the Company’s Compensation Committee) (the “Actual AIP Bonus”) exceeds the amount of the 2023 AIP Advance Bonus, the Company will pay such excess amount (less applicable taxes and withholdings) to you at the same time 2023 AIP bonuses are paid to the Company’s employees generally. If the Actual AIP Bonus is less than the 2023 AIP Advance Bonus, you will repay to the Company the excess (if any) of the after-tax portion of the 2023 AIP Advance Bonus over the Actual AIP Bonus (with the Actual AIP Bonus calculated on an after-tax basis assuming the Actual AIP Bonus had actually been paid to you at the same time that 2023 AIP bonuses are ordinarily paid) within 20 business days following the date that the Company makes such determination and notifies you of the applicable repayment amount. In addition, you hereby agree that you will promptly repay the net after-tax amount of such 2023 AIP Advance Bonus in the event you resign from employment prior to year-end, with such repayment to occur within 20 business days following such termination.
In connection with the 280G Mitigation, the Company has determined to (i) advance the payment of your 2023 Annual Incentive Plan (“AIP”) bonus in the amount of $______ (less applicable taxes and withholdings) based on an estimate of actual performance achievement, to be paid on _____ (the “2023 AIP Advance Bonus”), and (ii) accelerate the vesting of _____ shares subject to your time-based Restricted Stock Unit award granted on _____ under the Company’s 2020 Equity Incentive Plan, with such acceleration effective as of _____ (the “Accelerated RSUs”).
You will continue to be eligible to participate in the Company’s Performance-Based Annual Incentive Plan ("AIP"), a cash incentive program under which your payout is based on Tapestry’s financial performance, subject to its terms and conditions. As of the Effective Date, your target AIP bonus will be 175% of your salary actually paid from the Effective Date through the end of fiscal year 2021 and for subsequent fiscal years. For the portion of fiscal year 2021 prior to the Effective Date, your target AIP bonus will be governed by the Prior Letter Agreements. The actual AIP bonus payout may range from 0% of target for performance below established thresholds to 200% of target for maximum performance, with performance components, measures and target values to be established by the Company’s Board of Directors or the Human Resources Committee of the Board of Directors (the “Committee”). For avoidance of doubt, for fiscal year 2021, your target AIP bonus will be calculated as follows: 100% of your salary actually paid from the start of fiscal year 2021 until July 21, 2020, the effective date of your appointment as Interim Chief Executive Officer, 150% from July 21, 2020 until the Effective Date and 175% thereafter. Any AIP bonus paid during fiscal year 2021 will reflect your reduced salary, as in effect for any portion of the fiscal year.
Any AIP bonus is paid within three months of the end of the fiscal year and you must be an employee in good standing with the Company on the AIP bonus payment date in order to be eligible to receive any such AIP bonus payment, except as set forth in Section 5 below in the event of your involuntary termination other than for “cause” or your resignation for “Good Reason” (each as defined in the attached Addendum). If you resign your employment without “Good Reason” or are terminated for "cause," you are not eligible for this bonus for the fiscal year in which you provide the required notice of your intent to resign your employment (or resign without notice) or your employment is terminated, as applicable. For the purposes of this letter, termination for “cause” is defined in the Addendum. Please refer to the Corporate Pay section of Tapestry’s intranet, the Loop, for the governing terms and conditions of the AIP bonus plan. In addition, Tapestry’s Board of Directors has adopted an incentive repayment policy (attached) for members of the Executive Committee, which you must sign and return to me coincident with your acceptance of this offer.
(A)Performance Bonus for a Corporate AIP Bonus-eligible Position: Means, for a Corporate AIP Bonus-eligible Position, the sum of (i) the Company Bonus Objectives Percentage and (ii) Strategic Bonus Objectives Percentage.
This SYSCO CORPORATION ANNUAL INCENTIVE PROGRAM FOR CORPORATE AIP BONUS-ELIGIBLE PARTICIPANTS (the “Program”) was adopted by the Committee (as defined below) of Sysco Corporation (the “Company”) on July 29, 2022 (the “Effective Date”).
Corporate AIP Bonus-Eligible Participants: Those persons who serve in a Corporate AIP Bonus-eligible position and are designated by a Senior Officer (as defined below) as eligible to participate in the Program (each, a “Participant”).
(a)2021 AIP. If you remain employed by the Company until the earlier of the Closing Date or the date that bonuses under the Company’s 2021 Annual Incentive Plan (the “2021 AIP”) are paid (the “2021 AIP Payment Date”), you will receive your annual incentive bonus for calendar year 2021 (or prorated portion thereof) (your “2021 AIP Bonus”) under the 2021 AIP, calculated in accordance with the terms and conditions of the 2021 AIP, less applicable deductions and authorized withholdings. Your 2021 AIP Bonus shall be paid on the 2021 AIP Payment Date, but no later than March 15, 2022. Further, if your employment with the Company or the Purchaser is terminated without Cause before the 2021 AIP Payment Date, you will receive your 2021 AIP Bonus on the 2021 AIP Payment Date. For the avoidance of doubt, if you are terminated for Cause by the Company or the Purchaser or if you voluntarily resign at any time prior to the 2021 AIP Payment Date, you will not receive your 2021 AIP Bonus.
(b)2022 Catalysts AIP. If the Closing Date occurs on or after January 1, 2022 and you remain employed by the Company until the Closing Date, you will receive an amount equal to your target annual incentive under the annual bonus plan that will be established for the Business for calendar year 2022, multiplied by a fraction, the numerator of which is the number of days you were employed by the Company in 2022 through and including the Closing Date and the denominator of which is 365 (such amount, your “2022 Catalysts AIP Bonus”), less applicable deductions and authorized withholdings. Your 2022 Catalysts AIP Bonus shall be paid within thirty (30) days following the Closing Date (the “2022 Catalysts AIP Payment Date”). Notwithstanding anything in this Section 2(b) to the contrary, if you are terminated for Cause by the Company or the Purchaser or if you voluntarily resign at any time prior to the 2022 Catalysts AIP Payment Date, you will not receive the 2022 Catalysts AIP Bonus.
For a Participant promoted in the Plan Year from an Associate Incentive Plan (AIP) bonus eligible position to a Management Incentive Plan bonus eligible position on or before October 1, the AIP bonus will be calculated using the Participant’s base salary at the time of promotion, pro-rated based on the number of days in the AIP eligible position.
Any AIP bonus is paid within three months of the end of the fiscal year and you must be an employee in good standing with the Company on the AIP bonus payment date in order to be eligible to receive any such AIP bonus payment, except as expressly provided in this paragraph. Subject to your continued employment as an employee for one year following the Effective Date, if you provide the required notice of your intent to resign your employment due to your Retirement or are terminated without “cause,” you will be eligible to receive a pro-rated AIP bonus for the portion of the fiscal year you were employed prior to the date of your Retirement or termination without “cause” and based on actual achievement of the applicable performance criteria, paid when the Company pays AIP bonuses for such fiscal year. If you continue to serve as a member of the Board after your employment as Tapestry’s Chairman and Chief Executive Officer terminates, you will be eligible to receive a pro-rated AIP bonus for the fiscal year in which you cease to serve as Tapestry’s Chairman and Chief Executive Officer for the period of such fiscal year you were employed as Chairman and Chief Executive Officer in such fiscal year, based on actual achievement of the applicable performance criteria and paid when the Company pays AIP bonuses for such fiscal year.
An AIP bonus, or Annual Incentive Plan bonus, is a type of compensation awarded to employees, typically based on performance metrics achieved during a fiscal year. These bonuses are designed to incentivize and reward employees for reaching specific targets or objectives, aligning personal performance with the organization’s overall goals.
You should consider using an AIP bonus in scenarios where you want to:
Organizations often implement AIP bonuses annually, usually tying them to the completion of a fiscal year.
When drafting an AIP bonus plan, consider the following steps:
Define Objectives: Clearly outline the objectives you want your employees to achieve within the period.
Set Performance Metrics: Establish measurable criteria based on performance, which could include revenue targets, profit margins, customer satisfaction rates, etc.
Communicate Eligibility: Specify who is eligible for the bonus within your organization (e.g., all employees, management, specific departments).
Detail Payment Structure: Provide information on how the bonus will be calculated and distributed. This may include conditions under which the bonus is reduced or withheld.
Include Terms: State the terms and conditions, such as any proration of bonuses for partial employment during the year or circumstances leading to forfeiture.
Review and Revise: Consistently review the plan to ensure it remains aligned with your company’s strategic vision and market conditions.
AIP bonus provisions are commonly included in the following contracts:
Employment Contracts: Often specified for roles tied directly to performance outcomes, such as sales executives or senior leadership.
Executive Compensation Agreements: C-suites might have these clauses outlined as part of their incentive packages.
Collective Bargaining Agreements: In some cases, union agreements might include performance bonuses as negotiated terms.
Organizational Compendium Policies: Some companies might detail AIP bonuses as part of broader employee handbooks or policy documents applicable to eligible employees.
Example:
“Annual Incentive Plan Bonus: Eligible employees who achieve the specified performance targets will receive a bonus payout up to 10% of their base salary, calculated based on revenue growth and customer satisfaction scores.”
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