ANNEX B
Adjusted EBITDA may change from time to time but is generally expected to be Adjusted EBITDA as publicly reported by the Company to its
investors), and operating leverage or Adjusted EBITDA growth/sales growth; (
d
) basic or diluted earnings per share or improvement in basic or diluted earnings per share; (
e
) sales (including, but not limited to, total sales,
net sales, revenue growth, or sales growth in excess of market growth); (
f
) net operating profit; (
g
) financial return measures (including, but not limited to, return on assets, capital, invested capital, equity, sales, or
revenue); (
h
) cash flow measures (including, but not limited to, operating cash flow, free cash flow, cash flow return on equity, cash flow return on investment, cash conversion, or
pre-tax,
pre-interest
cash flow/Adjusted EBITDA); (
i
) productivity ratios (including but not limited to measuring liquidity, profitability or leverage) and synergies achievements; (
j
) share price
(including, but not limited to, growth measures and total stockholder return); (
k
) expense/cost management targets; (
l
) margins (including, but not limited to, operating margin, net income margin, cash margin, gross, net or
operating profit margins, EBITDA margins, Adjusted EBITDA margins); (
m
) operating efficiency; (
n
) market share or market penetration; (
o
) customer targets (including, but not limited to, customer growth or customer
satisfaction); (
p
) working capital targets or improvements; (
q
) economic value added; (
r
) balance sheet metrics (including, but not limited to, inventory, inventory turns, receivables turnover, net asset turnover, debt
reduction, retained earnings,
year-end
cash, cash conversion cycle, ratio of debt to equity or to EBITDA); (
s
) workforce targets (including but not limited to diversity goals, employee engagement or
satisfaction, employee retention, and workplace health and safety goals); (
t
) implementation, completion or attainment of measurable objectives with respect to research and development, key products or key projects, lines of business,
acquisitions and divestitures and strategic plan development and/or implementation; (
u
) comparisons with various stock market indices, peer companies or industry groups or classifications with regard to one more of these criteria,
(v) tax savings or (
w
) at any time in the case of (
A
) persons who are not covered employees under Section 162(m) or (
B
) Awards (whether or not to covered employees) not intended
to qualify as performance-based compensation under Section 162(m), such other criteria as may be determined by the Committee. In addition, the Company may use
Pre-Bonus
Adjusted EBITDA as a
Financial Performance Measure, which adds back any AIP Awards made during the fiscal year to Adjusted EBITDA. The foregoing Financial Performance Measures may be supplemented from time to time as appropriate. Performance Goals may be established on
a Company-wide basis or with respect to one or more business units, divisions, geographies, Subsidiaries or Affiliates, or products and may be expressed in absolute terms, or relative to (
i
) current internal targets or budgets,
(
ii
) the past performance of the Company (including the performance of one or more Subsidiaries, Affiliates, divisions, or operating units), (
iii
) the performance of one or more similarly situated companies, (
iv
) the
performance of an index covering a peer group of companies, or (
v
) other external measures of the selected performance criteria. Any performance goals that are financial metrics, may be determined in accordance with U.S. Generally
Accepted Accounting Principles (
GAAP
), in accordance with accounting principles established by the International Accounting Standards Board (
IASB Principles
), or may be adjusted when established to include or
exclude any items otherwise includable or excludable under GAAP or under IASB Principles. Any performance objective may measure performance on an individual basis, as appropriate. The Committee may provide for a threshold level of performance below
which no Shares or compensation will be granted or paid in respect of Performance Shares or Performance Units, and a maximum level of performance above which no additional Shares or compensation will be granted or paid in respect of Performance
Shares or Performance Units, and it may provide for differing amounts of Shares or compensation to be granted or paid in respect of Performance Shares or Performance Units for different levels of performance. The Committee may provide for exclusion
of the impact of an event or occurrence which the Committee determines should appropriately be excluded, including but not limited to unusual and/or infrequently occurring or nonrecurring items as determined under U.S. generally accepted accounting
principles and as identified in the financial statements, notes to the financial statements or managements discussion and analysis in the annual report, including, without limitation, the charges or costs associated with restructurings of the
Company, discontinued operations, capital gains and losses, dividends, Share repurchase, other unusual or
non-recurring
items, and the cumulative effects of accounting changes.
Section 9.6
Special Rule for Performance Goals
. If, at the time of grant, the Committee intends any Award to qualify as
performance-based compensation within the meaning of Section 162(m) (except with respect to Options or SARs), the Committee must establish Performance Goals (and any exclusions) for the applicable Performance Period prior to the 91
st
day of the Performance Period (or by such other date as may be required under Section 162(m)) but not later than the date on which twenty-five percent (25%) of the Performance Period has
elapsed.
Section 9.7
Negative Discretion
. Notwithstanding anything in this Article IX to the contrary, the Committee shall
have the right, in its absolute discretion, (
i
) to reduce or eliminate the amount otherwise payable to Participants under Section 9.9 based on performance or any other factors that the Committee, in its discretion, shall deem
appropriate, provided that any such reduction must be proportionate among all Participants, and (
ii
) to establish rules or procedures that have the effect of limiting the amount payable to each Participant to an amount that is less than
the maximum amount otherwise authorized under the Award or under the Plan.
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B-16
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Global Eagle Entertainment Inc.
- 2017 Proxy Statement
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