(e) On February 14, 2013, the Board of Directors (the "Board") of DTS, Inc. (the "Company"), upon the recommendation of the Compensation Committee of the Board (the "Committee"), established the cash bonus payments for each of the Company's named executive officers under the Company's 2012 bonus plan (the "Plan"). In addition, the Committee granted long-term equity incentive awards under the Company's 2012 Equity Incentive Plan to the Company's named executive officers in the form of non-statutory incentive stock options to purchase shares of the Company's common stock. The following table sets forth the cash bonus payments and stock option awards for each named executive officer:

    Recipients                    Title               Bonus Payments     Stock Options

Jon E. Kirchner                Chairman and Chief           $250,000           150,000
                                Executive Officer

Brian D. Towne           Executive Vice President           $113,750            60,000
                              and Chief Operating
                                          Officer

Melvin L. Flanigan      Executive Vice President,            $88,000            40,000
                                Finance and Chief
                                Financial Officer

Frederick L. Kitson      Executive Vice President            $94,875            60,000
                             and Chief Technology
                                          Officer

Blake A. Welcher        Executive Vice President,           $106,600            40,000
                                Legal and General
                                          Counsel

2012 Bonus Awards

In establishing the amounts of individual bonus awards for each named executive officer, the Board, upon the recommendation of the Committee, exercised its negative discretion to determine individual bonus amounts with each final bonus for 2012 being equal to approximately 50% of each officers' targeted bonus for the year. The Board considered, among other things, a desire to reward a year of strong strategic execution and relative financial performance in a very challenging environment and the need to balance the increasingly competitive marketplace for proven executive talent with the significant and expensive prospect of replacing key executives.

Long-Term Equity Incentive Awards

The Board, upon the recommendation of the Committee, granted to the named executive officers non-statutory incentive stock options to purchase shares of the Company's common stock at an exercise price of $20.48 per share, the closing price of the Company's common stock on the date of grant. These stock option awards vest over four years in four equal annual installments beginning on the first anniversary of the date of grant and expire ten years from the date of grant.

2013 Executive Incentive Compensation Plan

Also on February 14, 2013, the Board adopted the 2013 Executive Incentive Compensation Plan (the "2013 Plan"), in which certain of the Company's executive officers are eligible to participate. The 2013 Plan is a cash incentive award plan designed to align incentive awards for each participant's individual performance with the Company's corporate objectives. The parameters of the 2013 Plan provide for target and maximum cash bonus award levels, as a percentage of salary, based upon the achievement of specified company financial targets and key strategic initiatives. Depending on the Company's financial performance and strategic execution relative to the targets, the bonus payout levels, stated as a percentage of the officer's annual salary, are as follows:

    Name                    Title               Bonus Target (%)     Maximum Bonus (%)

Jon Kirchner             Chairman and Chief
                          Executive Officer                100.0                 198.8

 Brian Towne       Executive Vice President
                        and Chief Operating
                                    Officer                 65.0                 129.2

Mel Flanigan      Executive Vice President,
                          Finance and Chief
                          Financial Officer                 55.0                 109.3

 Fred Kitson       Executive Vice President
                       and Chief Technology
                                    Officer


                                                            55.0                 109.3
Blake Welcher     Executive Vice President,
                          Legal and General
                                    Counsel
                                                            65.0                 129.2

The 2013 Plan is structured into two components: 1) overall company financial targets, and 2) key strategic initiatives. Under the 2013 Plan, 65% of an executive's target opportunity is weighted on overall company financial performance and the other 35% percent is weighted on the execution of strategic objectives. The performance goals are to be reviewed in advance and approved by the Committee. Following the funding of the 2013 Plan based on the achievement of the financial targets and key strategic goals, an individual performance multiplier rating will be applied to recognize the specific performance for each executive. Under the terms of the 2013 Plan, any bonus amounts determined under the formulas described above may be adjusted in order to ensure that they are appropriate in light of the performance factors relevant to the particular executive, including discretionary adjustments based on other non-financial performance related metrics.