8-KMaterial Agreements

EMCOR Group, Inc. 8-K Report, Material Agreement (Mar 8, 2006)

Filed March 8, 2006For Securities:EME

Summary

EMCOR Group, Inc. (EME) has filed an 8-K report detailing the establishment of aggregate earnings per share objectives (EPSO) for its Long-Term Incentive Plan (LTIP). These objectives are set for two distinct performance cycles: a two-year cycle covering fiscal years 2006-2007 and a three-year cycle covering fiscal years 2006-2008. The LTIP is designed to incentivize key executive officers, including the CEO, President, CFO, and other senior leaders, by linking potential bonus payouts to the company's achievement of specified EPS targets.

Key Highlights

  • 1Establishment of specific Earnings Per Share Objectives (EPSO) for 2006-2007 and 2006-2008 performance cycles under the Long-Term Incentive Plan (LTIP).
  • 2Bonus payouts for eligible executive officers are directly tied to the company's achievement of these EPS objectives.
  • 3Bonus payout ranges from 50% to 200% of the Target Bonus based on achieving 50% to 120% of the EPSO, with no payout below 50% achievement.
  • 4Target Bonuses, expressed as a percentage of annual base salary, are set for each participating executive, with the CEO and President having the highest percentages (175% and 150%, respectively).
  • 5Bonuses for the two-year cycle are payable by March 15, 2008, and for the three-year cycle by March 15, 2009.
  • 6A cap of $3,000,000 is placed on any single bonus payout under the LTIP.

Frequently Asked Questions

The primary purpose of this filing is to inform investors that EMCOR Group, Inc. has officially set the earnings per share targets for its Long-Term Incentive Plan (LTIP) for executive compensation. This demonstrates how the company plans to incentivize its top leadership based on financial performance.

The compensation of key executives is directly linked to EMCOR's achievement of specific aggregate earnings per share objectives (EPSO) over two different performance periods: a two-year period (2006-2007) and a three-year period (2006-2008). Achieving these EPS targets will determine the percentage of their 'Target Bonus' that executives will receive.

Executives can receive between 50% and 200% of their 'Target Bonus' based on their achievement of the established EPS objectives. Specifically, 50% of the Target Bonus is paid for achieving 50% of the EPSO, 100% of the Target Bonus for achieving 100% of the EPSO, and up to 200% for achieving 120% of the EPSO. No bonus is paid if less than 50% of the EPSO is achieved.

Yes, there is a cap on bonus payouts. No single bonus payable under this Long-Term Incentive Plan may exceed $3,000,000.