PERMA FIX ENVIRONMENTAL SERVICES INC - FORM 8-K - EX-10.2 - March 3, 2010

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8-K - PERMA FIX ENVIRONMENTAL SERVICES INCv176149_8k.htm
EX-10.1 - PERMA FIX ENVIRONMENTAL SERVICES INCv176149_ex10-1.htm

VICE PRESIDENT, CHIEF FINANCIAL OFFICER

Effective: January 1, 2010

Vice President CFO 2010 Incentive Plan
3/3/2010

 
 
 

VICE PRESIDENT, CHIEF FINANCIAL OFFICER

PURPOSE:  To define the compensation plan for the Vice President, Chief Financial Officer.

SCOPE:  Perma-Fix Environmental Services, Inc.

POLICY:  The Vice President, Chief Financial Officer Compensation Plan is designed to retain, motivate and reward the incumbent to support and achieve the business, operating and financial objectives of Perma-Fix Environmental Services, Inc (the “Company”).

BASE SALARY:  The Base Salary indicated below is paid in equal periodic installments per the regularly scheduled payroll.

PERFORMANCE INCENTIVE COMPENSATION: Performance Incentive Compensation is available based on the Company’s financial results noted in Schedule A.  Effective date of plan is January 1, 2010 and incentive will be for entire year. Performance incentive compensation will be paid on or about 90 days after year-end, or sooner, based on final 10K financial statement.

SEPARATION:  Upon voluntary or involuntary separation from the Company the employee will be paid the base salary due to the last day of employment.  If employment is separated prior to the annual incentive compensation payment period as noted above, no incentive compensation is due to the incumbent.

ACKNOWLEDGEMENT:  Payment of Performance Incentive Compensation of any type will be forfeited, unless the Human Resources Department has received a signed acknowledgement of receipt of the Compensation Plan prior to the applicable payment date.

INTERPRETATIONS:  The Compensation Committee of the Board of Directors retains the right to modify, change or terminate the Compensation Plan at any time and for any reason.  It also reserves the right to determine the final interpretation of any provision contained in the Compensation Plan and it reserves the right to modify or change the Net Income or other applicable targets as defined herein in the event of the sale or disposition of any of the assets of the Company.  While the plan is intended to represent all situations and circumstances some issues may not easily be addressed.  The Compensation Committee will endeavor to review all standard and non-standard issues related to the Compensation Plan and will provide quick interpretations that are in the best interest of the Company, its shareholders and the incumbent.

Vice President CFO 2010 Incentive Plan
3/3/2010
 
 
 
 

VICE PRESIDENT, CHIEF FINANCIAL OFFICER

Base Pay and Performance Incentive Compensation Targets

The compensation for the below named individual as follows:

Annualized Base Pay:
   $ 208,000  
Performance Incentive Compensation Target (at 100% of Plan):
     52,000  
Total Annual Target Compensation (at 100% of Plan):
   $ 260,000  

The Performance Incentive Compensation Target is based on the Schedule A below.

Target Objectives

         
Performance Target Thresholds
  
   
Weights
      
100%+
      
98-99%
      
96-97%
      
94-95%
      
92-93%
      
90-91%
      
88-89%
  
                                                               
Administrative
     15 %     7,800       9,360       9,751       10,531       11,700       12,480       13,650  
                                                                 
           
Performance Target Thresholds
  
   
Weights
      
85-100%
      
101-120%
      
121-130%
      
131-140%
      
141-150%
      
151-160%
      
161%+
  
                                                                 
Net Income
     25 %     13,000       15,600       16,900       18,200       19,500       20,800       22,750  
                                                                 
Accounting
     10 %     5,200       6,240       6,760       7,280       7,800       8,320       9,100  
                                                                 
Accounts Receivable
     10 %     5,200       6,240       6,760       7,280       7,800       8,320       9,100  
                                                                 
SOX Compliance
     10 %     5,200       6,240       6,760       7,280       7,800       8,320       9,100  
                                                                 
Centralization & IT Objectives
     30 %     15,600       18,720       20,280       21,840       23,400       24,960       27,300  
                                                                 
Unbilled Receivables
  
* If criteria (Item #5) for reducing unbilled AR are not met bonus will be reduced by 15%
  
                                                                 
              52,000       62,400       67,211       72,411       78,000       83,200       91,000  
 
1)
Administrative Expense is defined as the total consolidated administrative expenses applicable as publicly reported in the Company’s financial statements.  Administrative expenses will be inclusive of all subsidiaries, and will exclude Marketing Expenses and Interest Expense. The Board reserves the right to make adjustments to administrative expenses so as not to penalize the employee for material unforeseen events outside of the employees responsibility and it reserves the right to modify or change the Administrative Expense Targets as defined herein in the event of the sale or disposition of any of the assets of the Company or in the event of an acquisition.  The Board further reserves the right to adjust Administrative Expenses to reflect charges resulting from the vesting of incentive stock options.
 
2)
Net Income is defined as the total consolidated pre-tax net income applicable to Common Stock as publicly reported in the Company’s financial statements.  The net income will include all subsidiaries, corporate charges, dividends and discounted operations.  The percentage achieved is determined by comparing the actual net income to the Board approved budgeted net income.  The Board reserves the right to make adjustments to net income so as not to penalize the employee for actions in the current year which will contribute to net income in future years and it reserves the right to modify or change the Net Income Targets as defined herein in the event of the sale or disposition of any of the assets of the Company or in the event of an acquisition.  The Board further reserves the right to adjust net income to reflect charges resulting from the vesting of incentive stock options.

Vice President CFO 2010 Incentive Plan
3/3/2010
 
 
 
 
 
3)
Accounting objective should focus on meeting filing deadlines such as 10K, 10Q, 8K and press releases with complete and accurate information.
 
SEC Filings
  
Performance Target
  
10K – filed timely or
     3 %
10K – extension
     1.5 %
1st quarter 10Q – filed timely or
     2 %
1st quarter 10Q – extension
     1 %
2nd quarter 10Q – filed timely or
     2 %
2nd quarter 10Q – extension
     1 %
3rd quarter 10Q – filed timely or
     2 %
3rd quarter 10Q - extension
     1 %
All 8K’s Filed
     1 %
         
Total Achievable
     10 %
 
4)
Accounts Receivable objective should focus on achieving certain AR targets.
 
Accounts Receivable
  
Performance Target
  
25% or less of AR > than 60 days
     5.0 %
30% or less of AR > than 60 days
     2.5 %
9% or less of AR > than 120 days
     5.0 %
10% or less of AR > than 120 days
     2.5 %
Total Achievable
     10.0 %
 
Accounts Receivable will be defined as outstanding accounts receivable, per companies AR sub-ledger, collectable within the control of the financial and operational staff.
 
Adjustments for this figure will include but not be limited to:
 
 
1.
Accounts fully reserved when calculating Bad Debt Allowance;
 
 
2.
Accounts that are in litigation; and
 
 
3.
Accounts not receivable due to a legitimate operational delay.  Note this will only be excluded if invoicing was appropriate despite the operational delay.
 
5)
The SOX Incentive target is based maintaining good internal controls and minimizing material weaknesses similar to “Permit and License” violations on CEO Plan.
 
SOX Deficiencies
  
Performance Target
  
0
     10 %
1
     9 %
2
     8 %
3
     5 %
4
     2 %
> 4
     0 %

Vice President CFO 2010 Incentive Plan
3/3/2010

 
 
 

6)
Centralization Objective - Completion of the following milestones related to the planned centralization of the accounting function to the Corporate office. Completion of each objective earns 3% with a maximum target achievable of 30%.

Accounting Centralization Objectives
  
Performance
Target
  
·  Complete Rollout of Solomon Accounting Purchase Order System at Facilities
     3.0 %
         
·  Final Phase of AP transition integrating PO system and centralized AP system.
     3.0 %
         
·  Rollout Image-link to remaining facilities (paperless filing of accounting back-up)
     3.0 %
         
·  Install Multi-Company Software at Corporate Office
     3.0 %
         
·  Centralize all remaining JE’s at Corporate office (mostly revenue related)
     3.0 %
         
·  Improved forecasting model from facilities including new software if cost effective.
     3.0 %
         
·  Payroll Processing Improvements – Improved time management systems if cost effective.
     3.0 %
         
·  Cost accounting initiatives to support Field Services initiative and DCAA audit requirements.
     3.0 %
         
·  Complete and make operational PFNW waste tracking system.
     3.0 %
         
·  Plan for implementation of new waste tracking system at other nuclear facilities and industrial facilities if cost effective.
     3.0 %
         
·  System integration plan for the Southeast
     3.0 %
         
·  Tele-Com Consolidation
     3.0 %

7)
Unbilled trade receivables is the amount of unbilled reported per 10Q or 10K combining both the long term and current portion of unbilled.    Unbilled trade receivable balances older than 12/31/07 should be reduced by $2.5 million from $3,380,000 as of 12/31/09 to $880,000 by 12/31/10.

Performance Incentive Compensation Payment

Effective date of plan is January 1, 2010 and incentive will be for entire year. Performance incentive compensation will be paid on or about 90 days after year-end, or sooner, based on final 10K financial statement.

ACKNOWLEDGMENT:
I acknowledge receipt of the aforementioned Vice President, Chief Financial Officer 2010 - Compensation Plan.  I have read and understand and accept employment under the terms and conditions set forth therein.

/s/Ben Naccarato
  
3/2/2010
  
/s/Ben Naccarato
  
Date
  
       
/s/Mark Zwecker
  
3/2/2010
  
/s/ Board of Director
  
Date
  

Vice President CFO 2010 Incentive Plan
3/3/2010

 
 
 

PERMA FIX ENVIRONMENTAL SERVICES INC Reports