What is the purpose of the Annual Officer Incentive Plan (AOIP)?

The AOIP is designed to motivate and reward certain officers through cash incentive awards. These awards are contingent upon their individual performance, the performance of specific business units, and the overall profitability and performance of ONEOK, Inc.

What are the key performance metrics for the 2005 AOIP?

For 2005, the corporate performance metrics are Return on Invested Capital (ROIC) and Earnings Per Share (EPS), with each metric accounting for 50% of the corporate performance evaluation.

What happens if ONEOK does not meet the threshold performance levels for ROIC or EPS?

If the company's actual ROIC for 2005 is below the threshold level set by the Committee, no incentive amount will be paid based on that performance measure. Similarly, if actual EPS is below its threshold level, no incentive amount will be paid based on the EPS performance measure.

Can officers receive more than their target incentive award?

Yes, officers can receive more than their target award. If both the maximum ROIC and target EPS are achieved or exceeded, the corporate performance portion of the incentive award can reach 200% of the officer's target award. The Committee can also adjust awards based on business unit and individual performance.

OKE 8-K: Material Agreements

Summary

This 8-K filing from ONEOK, Inc. (OKE) on January 21, 2005, details the company's 2005 performance goals for its Annual Officer Incentive Plan (AOIP). The plan is designed to incentivize officers through cash awards tied to individual performance, business unit performance, and overall company profitability. For the 2005 fiscal year, the corporate performance metrics have been established by the Executive Compensation Committee of the Board of Directors. These metrics are split equally between Return on Invested Capital (ROIC) and Earnings Per Share (EPS), each weighted at 50%. Specific threshold, target, and maximum levels have been set for both ROIC and EPS, with provisions for no incentive payout if threshold levels are not met. The plan also outlines maximum payouts based on achieving target or higher levels for these metrics, with provisions for adjustments based on business unit and individual performance.

Key Highlights

1ONEOK, Inc. has established corporate performance goals for its 2005 Annual Officer Incentive Plan (AOIP).
2The corporate performance metrics are weighted equally at 50% each between Return on Invested Capital (ROIC) and Earnings Per Share (EPS).
3No incentive payout will be made for a specific metric if the company's actual performance falls below the threshold level set by the Compensation Committee.
4Maximum incentive payments are capped, with ROIC awards not exceeding 300% of the target and EPS awards not exceeding 100% of the target.
5Achievement of maximum ROIC and target EPS could result in a corporate performance-based incentive award of 200% of the officer's target award.
6The Committee retains the authority to adjust incentive awards based on business unit and individual performance criteria after assessing corporate performance.

ONEOK INC /NEW/ 8-K Report, Material Agreement (Jan 21, 2005)

Summary

Key Highlights

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