{"id":40439,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/senior-executive-short-term-incentive-plan-blockbuster-inc.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"senior-executive-short-term-incentive-plan-blockbuster-inc","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/senior-executive-short-term-incentive-plan-blockbuster-inc.html","title":{"rendered":"Senior Executive Short-Term Incentive Plan &#8211; Blockbuster Inc."},"content":{"rendered":"<pre>\n                                BLOCKBUSTER INC.\n\n                                SENIOR EXECUTIVE\n\n                            SHORT-TERM INCENTIVE PLAN\n\n                                    ARTICLE I\n\n                                     GENERAL\n\n\nSECTION 1.1   PURPOSE.\n\n         The purpose of the Blockbuster Inc. Senior Executive Short-Term\nIncentive Plan (the 'Plan') is to benefit and advance the interests of\nBlockbuster Inc., a Delaware corporation (the 'Company'), by rewarding selected\nsenior executives of the Company and its subsidiaries for their contributions to\nthe Company's financial success and thereby motivating them to continue to make\nsuch contributions in the future by granting annual performance-based awards\n('Awards').\n\nSECTION 1.2   ADMINISTRATION OF THE PLAN.\n\n         The Plan shall be administered by a committee (the 'Committee')\nappointed by the Board of Directors of the Company (the 'Board'), consisting of\nat least such number of directors as is required from time to time to satisfy\nthe requirements of the exception under Section 162(m) of the Internal Revenue\nCode of 1986, as amended (the 'Code'), for 'qualified performance-based\ncompensation,' and each such Committee member shall satisfy the qualification\nrequirements of Section 162(m) of the Code. The Committee shall adopt such rules\nas it may deem appropriate in order to carry out the purpose of the Plan. All\nquestions of interpretation, administration and application of the Plan shall be\ndetermined by a majority of the members of the Committee then in office, except\nthat the Committee may authorize any one or more of its members, or any officer\nof the Company, to execute and deliver documents on behalf of the Committee. The\ndetermination of such majority shall be final and binding in all matters\nrelating to the Plan. The Committee shall have authority to determine the terms\nand conditions of the Awards granted to eligible persons specified in Section\n1.3 below ('Participants').\n\n         With respect to any restrictions in the Plan that are based on the\nrequirements of Section 162(m) of the Code or any other applicable law, rule or\nrestriction, to the extent that any such restrictions are no longer required,\nthe Committee shall have the sole discretion and authority to grant Awards that\nare not subject to such restrictions and\/or to waive any such restrictions with\nrespect to outstanding Awards.\n\n\n                                       -1-\n\n\n\n\nSECTION 1.3   ELIGIBLE PERSONS.\n\n         Awards may be granted only to employees of the Company or one of its\nsubsidiaries who are at the level of Senior Vice President of the Company or one\nof its subsidiaries or at a more senior level. An individual shall not be deemed\nan employee for purposes of the Plan unless such individual receives\ncompensation from either the Company or one of its subsidiaries for services\nperformed as an employee of the Company or any of its subsidiaries.\n\n                                   ARTICLE II\n\n                                     AWARDS\n\n\nSECTION 2.1   AWARDS.\n\n         The Committee may grant Awards to eligible employees with respect to\neach fiscal year of the Company or the portion of the fiscal year remaining\nafter the initial public offering of Class A Common Stock of the Company (the\n'IPO'), subject to the terms and conditions set forth in the Plan.\n\nSECTION 2.2   TERMS OF AWARDS.\n\n         Not later than ninety days after the start of each fiscal year of the\nCompany or, in the case of the fiscal period commencing with the IPO, before\ntwenty-five percent of such fiscal period has elapsed, the Committee shall\nestablish (i) performance goals and objectives ('Performance Targets') for the\nCompany and the subsidiaries and divisions thereof for such period ('Performance\nPeriod') and (ii) target awards ('Target Awards') for each Participant which\nshall be a percentage of the Participant's Salary (as defined in Section 2.3\nbelow). Such Performance Targets shall relate to the achievement of annual\nfinancial goals based on the attainment of specified levels of Operating Income,\nNet Earnings and\/or Cash Flow (as such terms are defined below) for the Company\nand the subsidiaries and divisions thereof. For purposes of the Plan, 'Operating\nIncome' shall mean revenues less operating expenses (other than depreciation,\namortization and non-recurring charges); 'Net Earnings' shall mean net earnings\nfrom continuing operations; and 'Cash Flow' shall mean Operating Income less\ncash capital expenditures and rental library purchases and increases or\ndecreases in working capital and in other balance sheet investments.\n\nSECTION 2.3   LIMITATION ON AWARDS.\n\n         The aggregate amount of all Awards to any Participant for any\nPerformance Period shall not exceed the amount determined by multiplying such\nParticipant's Salary by a factor of eight. For purposes of the Plan, 'Salary'\nshall mean (a) for any Participant hired on or before July 15, 1999, the sum of\n(i) the annual base salary of the Participant for such year, and (ii) an amount\nequal to the annual rate of any deferred compensation for such year, in each\ncase, as set forth in\n\n\n                                       -2-\n\n\n\n\nthe Participant's employment agreement as in effect on July 15, 1999; PROVIDED\nthat, if the employment agreement expires prior to the end of any Performance\nPeriod, the amount of base salary and deferred compensation determined hereunder\nshall relate to the highest annual amounts that were provided for under such\nemployment agreement; and (b) for any Participant hired after July 15, 1999, the\nsum of (x) such Participant's annual base salary on the date of hire, and (y) an\namount equal to the annual rate of any deferred compensation for the year of\nhire, in each case, as set forth in such Participant's employment agreement as\nin effect on his date of hire; PROVIDED, that the Salary for this purpose of a\nParticipant hired after July 15, 1999, shall not exceed 1.5 times the highest\nSalary on July 15, 1999 for any Participant determined pursuant to clause (a) of\nthis Section 2.3. Notwithstanding the foregoing, 'Salary' determined hereunder\nshall not include any amounts that would cause the Committee to exercise\ndiscretion not otherwise permitted by Section 162(m) of the Code.\n\nSECTION 2.4   DETERMINATION OF AWARD.\n\n         The Committee shall, promptly after the date on which the necessary\nfinancial or other information for a particular Performance Period becomes\navailable, certify whether the Performance Targets have been achieved in the\nmanner required by Section 162(m) of the Code. If the Performance Targets have\nbeen achieved, the Awards for such Performance Period shall have been earned\nexcept that the Committee may, in its sole discretion, reduce the amount of any\nAward to reflect the Committee's assessment of the Participant's individual\nperformance or for any other reason. Subject to Section 2.5, such Awards shall\nbecome payable in cash as promptly as practicable thereafter.\n\nSECTION 2.5   EMPLOYMENT REQUIREMENT.\n\n         To be eligible to receive payment of an Award, the Participant must\nhave remained in the continuous employ of the Company or its subsidiaries\nthrough the end of the applicable Performance Period; PROVIDED that, if a\nParticipant becomes 'permanently disabled' (in each case, as determined by the\nCommittee in its sole discretion) or a Participant dies during a Performance\nPeriod, such Participant or his estate shall be awarded, unless his employment\nagreement provides otherwise, a pro rata portion of the amount of the Award\nearned for such Performance Period, except that the Committee may, in its sole\ndiscretion, reduce the amount of such Award to reflect the Committee's\nassessment of such Participant's individual performance prior to such\nParticipant's becoming permanently disabled or such Participant's death, as the\ncase may be, or for any other reason.\n\n                                   ARTICLE III\n\n                              ADJUSTMENT OF AWARDS\n\n\n         In the event that, during a Performance Period, any recapitalization,\nreorganization, merger, acquisition, divestiture, consolidation, spin-off,\ncombination, liquidation, dissolution,\n\n\n                                       -3-\n\n\n\n\nsale of assets, or other similar corporate transaction or event, or any other\nextraordinary item or event not foreseen at the time of the grant of the Award,\nor any other event which distorts the applicable performance criteria occurs\ninvolving the Company or a subsidiary or division thereof, the Committee shall,\nto the extent consistent with Section 162(m) of the Code, adjust or modify, as\ndetermined by the Committee in its sole and absolute discretion, the calculation\nof Operating Income, Net Earnings and\/or Cash Flow, or the applicable\nPerformance Targets, to the extent necessary to prevent reduction or enlargement\nof Participants' Awards under the Plan for such Performance Period attributable\nto such transaction or event. Such adjustments shall be conclusive and binding\nfor all purposes.\n\n                                   ARTICLE IV\n\n                                  MISCELLANEOUS\n\n\nSECTION 4.1   NO RIGHTS TO AWARDS OR CONTINUED EMPLOYMENT.\n\n         No employee shall have any claim or right to receive Awards under the\nPlan. Neither the Plan nor any action taken hereunder shall be construed as\ngiving any employee any right to be retained by the Company or any of its\nsubsidiaries.\n\nSECTION 4.2   RESTRICTION ON TRANSFER.\n\n         The rights of a Participant with respect to Awards under the Plan shall\nnot be transferable by the Participant to whom such Award is granted, otherwise\nthan by will or the laws of descent and distribution.\n\nSECTION 4.3   TAX WITHHOLDING.\n\n         The Company or a subsidiary thereof, as appropriate, shall have the\nright to deduct from all payments made under the Plan to a Participant or to a\nParticipant's beneficiary or beneficiaries any federal, state or local taxes\nrequired by law to be withheld with respect to such payments.\n\nSECTION 4.4   NO RESTRICTION ON RIGHT OF COMPANY TO EFFECT CHANGES.\n\n         The Plan shall not affect in any way the right or power of the Company\nor its stockholders to make or authorize any recapitalization, reorganization,\nmerger, acquisition, divestiture, consolidation, spin-off, combination,\nliquidation, dissolution, sale of assets, or other similar corporate transaction\nor event involving the Company or a subsidiary thereof or any other event or\nseries of events, whether of a similar character or otherwise.\n\n\n                                       -4-\n\n\n\n\nSECTION 4.5   SOURCE OF PAYMENTS.\n\n         The Company shall not have any obligation to establish any separate\nfund or trust or other segregation of assets to provide for payments under the\nPlan. To the extent any person acquires any rights to receive payments hereunder\nfrom the Company, such rights shall be no greater than those of an unsecured\ncreditor.\n\nSECTION 4.6   AMENDMENT AND TERMINATION.\n\n         The Board may at any time and from time to time alter, amend, suspend\nor terminate the Plan in whole or in part; PROVIDED, HOWEVER, that no alteration\nor amendment will be effective without stockholder approval if such approval is\nrequired by law. No termination or amendment of the Plan may, without the\nconsent of the Participant to whom an Award has been made, adversely affect the\nrights of such Participant in such Award.\n\nSECTION 4.7   GOVERNMENTAL REGULATIONS.\n\n         The Plan, and all Awards hereunder, shall be subject to all applicable\nrules and regulations of governmental or other authorities.\n\nSECTION 4.8   HEADINGS.\n\n         The headings of articles and sections herein are included solely for\nconvenience of reference and shall not affect the meaning of any of the\nprovisions of the Plan.\n\nSECTION 4.9   GOVERNING LAW.\n\n         The Plan and all rights and Awards hereunder shall be construed in\naccordance with and governed by the laws of the State of Delaware without regard\nto conflicts of law principles and applicable federal law.\n\nSECTION 4.10  EFFECTIVE DATE.\n\n         The Plan became effective upon its adoption by the Board and its\napproval by the stockholder of the Company on July 15, 1999.\n\n\n                                       -5-\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6911],"corporate_contracts_industries":[9469],"corporate_contracts_types":[9539,9546],"class_list":["post-40439","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-blockbuster-inc","corporate_contracts_industries-media__rental","corporate_contracts_types-compensation","corporate_contracts_types-compensation__incentive"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/40439","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=40439"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=40439"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=40439"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=40439"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}