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ETRM > SEC Filings for ETRM > Form 8-K on 10-May-2016All Recent SEC Filings

Show all filings for ENTEROMEDICS INC

Form 8-K for ENTEROMEDICS INC


10-May-2016

Change in Directors or Principal Officers


Item 5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(e) On May 4, 2016, the Board of Directors (the "Board") of EnteroMedics Inc. (the "Company") established and approved certain objectives under the Company's Management Incentive Plan, as amended (the "Plan") for fiscal year 2016. A summary of the Plan was previously attached as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on February 12, 2008 and is incorporated herein by reference.

With respect to the corporate performance component, on May 4, 2016, the Board established objectives for the "Base Plan" and the "Incremental Plan." Pursuant to the Plan, if participants achieve the designated "Base Plan" objectives, they will be entitled to receive a bonus equal to a "Base Plan" percentage of their base salary for the year. In addition to the Base Plan bonus amount, participants in the Plan are also eligible to receive an additional bonus equal to the designated "Incremental Plan" percentage of their base salary if certain additional "Incremental Plan" objectives are achieved. For example, if 100% of the corporate objectives under the Base Plan and Incremental Plan are achieved, the CEO would be eligible for a total bonus equal to 50% of his base salary. The table below sets forth the updated bonus percentages that may be paid to participants in the Plan under the "Base Plan" and "Incremental Plan":

                                                                                                           Maximum
                                                 "Base Plan"               "Incremental Plan"               Bonus
                                             (bonus as percentage        (bonus as percentage of        (as percentage
Title                                             of salary)                     salary)                  of salary)
President and CEO                                               40 %                           10 %                  50 %
CFO/CCO and EVP MA/CMO                                          35 %                           10 %                  45 %
Senior VP                                                       32 %                            8 %                  40 %
VP                                                              28 %                            7 %                  35 %
Director                                                        20 %                            5 %                  25 %

The performance objectives under the Plan include individual as well as corporate performance components for all participants except (i) the Chief Executive Officer, (ii) the Chief Financial Officer and Chief Compliance Officer and (iii) the Executive Vice President of Medical Affairs and Chief Medical Officer, whose bonuses are based entirely on corporate performance objectives. The corporate performance objectives are set for all participating executive officers by the the Board. The individual performance objectives are set separately and specifically for each participating individual by their direct supervisor. The individual objectives are weighted against the corporate performance component in determining the bonus as set forth in the table below:

                                         Corporate
                                         Objective
               Title                     Weighting        Individual
               President and CEO                100 %               0 %

               CFO/CCO and EVP MA/CMO           100 %               0 %
               Senior VP                         90 %              10 %
               VP                                80 %              20 %
               Director                          60 %              40 %


The "Base Plan" corporate performance objectives established by the Board for fiscal year 2016 consist of: (i) the achievement of a certain level of unit sales of the Company's Maestro Rechargeable System in 2016; (ii) the achievement of certain milestones in 2016 related to the Company's reimbursement plan;
(iii) the implementation of certain tracking and reporting procedures for users of the Maestro Rechargeable System; and (iv) the achievement of certain financial objectives. The "Incremental Plan" corporate performance objective for fiscal year 2016 is the achievement of a minimum amount of revenue generated from sales of the Maestro Rechargeable System. If the Incremental Plan objective is achieved, the Compensation Committee may, in its discretion, increase the total bonus award up to 150%. The Incremental Plan objectives are designed as an extension of certain Base Plan objectives in order to provide additional incentive for achievement. In accordance with the Plan, the Compensation Committee of the Board, in its discretion, may determine to award partial or full payment of annual cash incentive compensation in the event that some, but not all, of the "Base Plan" or "Incremental Plan" corporate goals are achieved.


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