INTERFACE, INC.
EXECUTIVE BONUS PLAN
1.
PURPOSE.
The
purpose of the Interface, Inc. Executive Bonus Plan is to
provide bonus compensation opportunities which support the
Company’s on-going efforts to attract, retain and
develop exceptional executive talent and which provide
incentives directly linked to the Company’s business
objectives. The Plan is intended to meet the requirements for
"qualified performance-based compensation" under Section
162(m) of the Internal Revenue Code of 1986, as
amended.
2.
DEFINITIONS.
The
following capitalized terms, as used herein, shall have the
following meanings:
(a)
"Annual Base Salary" shall mean: (i) with respect to any
Participant other than a Section 162(m) Officer, the base
salary paid to such Participant during any Performance Period
(up to a maximum of one year’s base salary paid); and
(ii) with respect to any Section 162(m) Officer, the annual
rate of base salary of such Section 162(m) Officer in effect
on the first day of any Performance Period.
(b)
"Award" shall mean an incentive compensation award, granted
pursuant to the Plan, which is contingent upon the attainment
of Performance Goals with respect to a Performance
Period.
(c)
"Board" shall mean the Board of Directors of
Interface.
(d)
"Change in Control" shall mean the occurrence of an event
described in Section 5(d) hereof.
(e)
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
(f)
"Committee" shall mean a committee of the Board as described
in Section 3 hereof.
(g)
"Company" shall mean, collectively, Interface and its direct
and indirect subsidiaries.
(h)
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
(i)
"Interface" shall mean Interface, Inc., a Georgia
corporation.
(j)
"Participant" shall mean an executive officer of the Company
who is, pursuant to Section 4 of the Plan, selected to
participate in the Plan.
(k)
"Performance Goal" shall mean the criteria and objectives,
determined by the Committee, which must be met during the
applicable Performance Period as a condition of the
Participant's receipt of payment with respect to an Award.
Performance Goals may relate to attainment by the Company or a
subsidiary or business unit of specified levels or increases
in any or all of the following: (i) operating income for
operations managed; (ii) cash flow for operations managed;
(iii) reduction of off-quality and waste; (iv) return on
equity; (v) earnings per share; (vi) return on capital;
(vii) return on assets; (viii) value-based management; (ix)
earnings before interest and taxes; (x) sales growth; (xi)
gross margin; (xii) total earnings; (xiii) earnings
growth; (xiv) increase in the fair market value of Interface's
common stock; (xv) improvement in fixed charge coverage
ratio; (xvi) debt reduction and/or cash accumulation; or
(xvii) measurable financial criteria associated with credit
facility, bond indenture or other covenants. In addition, with
respect to Participants who are not Section 162(m) Officers,
the Committee may establish other Performance Goals, including
goals relating to individual performances and non-financial
objectives.
(l)
"Performance Period" shall mean the Company's fiscal year or
such other time period determined by the Committee during
which Performance Goals are to be met.
(m)
"Plan" shall mean the Interface, Inc. Executive Bonus
Plan.
(n)
"Section 162(m) Officer" shall mean an officer of the Company
who, in the Committee's determination made at the time of any
Award, is or may become a "covered employee" as defined in
Section 162(m) of the Code and the regulations
thereunder.
3.
ADMINISTRATION.
(a)
GENERAL. The Plan shall be administered by the Committee. The
Committee shall have the authority in its sole discretion,
subject to the express provisions of the Plan, to administer
the Plan and to exercise all the powers and authority either
specifically granted to it under the Plan or necessary or
advisable in the administration of the Plan, including,
without limitation: the authority to grant Awards; to
determine the persons to whom, and the time or times at which,
Awards shall be granted; to determine the terms, conditions,
restrictions and performance criteria, including Performance
Goals, relating to any Award; to determine the commencement
date and end date for each Performance Period; to determine
whether, to what extent, and under what circumstances an Award
may be settled, canceled, forfeited, or surrendered; to
construe and interpret the Plan and any Award; to prescribe,
amend and rescind rules, regulations and procedures relating
to the Plan; to determine the terms and provisions of Awards;
and to make all other determinations deemed necessary or
advisable for the administration of the Plan. All decisions,
determinations and interpretations of the Committee shall be
final and binding on all persons, including the Company, the
Participant (or any person claiming any rights under the Plan
from or through any Participant) and any
shareholder.
(b)
MEMBERS. The Committee shall consist of two or more members of
the Board, each of whom shall be an "outside director" within
the meaning of Section 162(m) of the Code. All determinations
of the Committee shall be made by a majority of its members
either present in person or participating by conference
telephone at a meeting or by written consent. The Committee
may delegate to one or more of its members or to one or more
agents such administrative duties as it may deem advisable,
and the Committee or any person to whom it has delegated
duties as aforesaid may employ one or more persons to render
advice with respect to any responsibility the Committee or
such person may have under the Plan.
(c)
LIABILITY. No member of the Board or the Committee shall be
liable for any action taken or determination made in good
faith with respect to the Plan or any Award granted
hereunder.
4.
ELIGIBILITY.
The
Committee shall select which executive officers of the Company
are to participate in the Plan for a Performance Period. In
selecting the officers of the Company who are eligible to
participate in the Plan and in establishing the terms of
Awards granted to such Participants, the Committee may accept
such recommendations of the senior management of the Company
as it deems appropriate. The Committee shall sp
