Summary
Mastercard Inc. (MA) filed an 8-K on February 5, 2010, reporting on the approval of performance targets for its Senior Executive Annual Incentive Compensation Plan (SEAICP) for the fiscal year ending December 31, 2010. These targets are crucial for determining the potential cash bonus awards for the company's principal executive officer, principal financial officer, and other named executive officers. The structure of the incentive plan emphasizes both net income and operating margin improvement, with net income achievement accounting for two-thirds of the bonus calculation and operating margin improvement for the remaining one-third. Investors should note that the payout for these bonuses is contingent upon the company achieving specific predetermined performance levels. Performance below a 'threshold' level will result in no bonus payout, while exceeding targets could lead to significantly higher awards, capped at a 'maximum' percentage of base salary. This filing provides insight into management's short-term performance objectives and the direct link between company financial results and executive compensation.
Key Highlights
- 1Mastercard approved 2010 performance targets for its Senior Executive Annual Incentive Compensation Plan (SEAICP).
- 2Bonus payouts are tied to achieving predetermined net income and operating margin improvement targets.
- 3Net income performance accounts for two-thirds of the bonus calculation, while operating margin improvement accounts for one-third.
- 4Performance below a 'threshold' level will result in no cash bonus payout for executives.
- 5Executives have 'target' and 'maximum' bonus potential based on exceeding performance goals.
- 6Specific bonus percentages of base salary are outlined for key executives (e.g., Robert W. Selander, Martina Hund-Mejean) at threshold, target, and maximum performance levels.