Exhibit 10.3
Watson Wyatt
Worldwide, Inc.
Performance Share Bonus Incentive
Program
FY09
Summary
The Performance Share Bonus Incentive Program
(the Program) is a long-term bonus program for senior executives,
designed to strengthen incentives and align behaviors to grow the
business in a way that is consistent with the strategic goals of
the Company. Incentives are provided through grants of
deferred stock units tied to a 3-year performance period with
vesting contingent upon meeting certain Company goal
thresholds. This bonus program does not replace the Fiscal
Year End Bonus (FYEB).
Eligibility
Associates of Watson Wyatt & Company
and its Affiliates will be eligible for nomination to participate
in the Program. Eligible participants will be nominated and
approved by the Compensation Committee of the Board (the
Committee). Generally, associates eligible for nomination
will be high performing, senior-level executives that have direct
impact or responsibility for driving strategy throughout the
organization. A list of participants nominated and approved
by the Committee for the performance period beginning July 1,
2008 and ending June 30, 2011 is attached hereto as Attachment
1.
Performance Period
The performance period is a 3-year period that
begins on July 1, 20xx and ends on June 30, 20xx+3.
For example, the performance period that began on July 1, 2008
will end on June 30, 2011. Baseline metrics are
established at the beginning of the performance period. At
the end of the performance period, performance metrics will then be
measured. The Company will follow its standard process for
financial reporting following the close of the fiscal year.
Once Company financial results are finalized (August following
end of fiscal year) the final performance metric results for the
most recent performance period can be determined.
Grants
Grants of stock (performance shares) are made
under the 2001 Deferred Stock Unit Plan for Selected
Employees . Grants are based on the value of the cash
portion of the Fiscal Year End Bonus target. A multiplier,
which varies by participation tier, is then applied to that value
to determine the cash value of the performance shares. The
cash value is then converted to a number of shares of stock based
on the stock market closing price on the last day of the fiscal
year prior to the grant. For calculation purposes, band and
salary information will be based on what is in effect as of
October 1 of the first fiscal year of the performance
period.
All performance share grants will be made by the
Committee at the beginning of each performance period (following
the fiscal year end close process). Final grant amounts will
generally be determined by the method outlined here. However,
the Committee, at its discretion, may adjust final grant
amounts.
