[Graphic Appears Here] Exhibit 10.5
CORPORATE POLICY MANUAL
PERFORMANCE INCENTIVE AWARDS
POLICY NUMBER: 716 Page 1 of 2
It is the policy of the Company to consider performance incentive
awards in recognition of superior performance by its employees in the
pursuit of corporate objectives. This policy applies to every employee
of the Company; the guidelines described below will be used to select
which employees may receive a bonus.
The Company normally budgets a percentage of gross salaries for
retirement plan contributions and for bonuses. There are certain
minimum contribution requirements established by the qualified
Retirement Plan. After consideration of these minimum requirements, an
additional, affordable amount is determined which can be distributed
under the following options; as an additional tax qualified retirement
plan contribution (if within IRS guidelines); as a standard percentage
cash payment to eligible group members; or as incentive bonuses. This
policy addresses only the incentive bonus practices of the Company.
Performance goals for operating or administrative units will be
jointly established by the CEO, Division Managers and other Corporate
Officials. These goals will relate, but are not limited to, important
variables such as business volume, timely and accurate execution of
administrative functions, growth of backlog, cost and schedule control
of projects, effective resource management and conformance with
indirect cost budgets. There will also be less easily measured goals
of customer satisfaction and employee relations. Once goals have been
established, each Division Manager will establish supporting
performance goals with his subordinates. This need not be as formal a
process as established between the CEO and the Division Manager. It is
important that the goals be communicated and agreed. Managers should
ensure that all personnel in their departments understand what the
goals are, and each individual's role in reaching those goals.
[Graphic Appears Here] CORPORATE POLICY MANUAL
PERFORMANCE INCENTIVE AWARDS
POLICY NUMBER: 716 Page 2 of 2
III. AWARD PROCESS
Annually (usually the last quarter of the year) the CEO will review
the performance goals and achievement with the Division Manager or
other Corporate Officials and make tentative allocation of available
bonus monies. The Division Manager will organize the preparation of
the Employee Bonus Proposal (Form 716) forms for each employee to be
so recognized, and submit them to the CEO for final review and
approval. The CEO will present to the Board of Directors the
information required by the Board to obtain final approval for the
bonuses as recommended.
The bonus payments and cover letters to each awardee will then be
processed before year end, or other time schedule as stipulated by the
The Company recognizes that, from time to time, superior performance
may require immediate recognition. As such, the CEO may make immediate
awards outside of the annual process when circumstances warrant such
action. The documentation required by Part III - Award Process, will
be completed to substantiate the reasons for the award.
Employee Bonus Proposal - Form 716
Form 716 is required to be completed for each proposed award. There
are two key narrative sections. The top narrative section can be done
in any writing style to document the award. The lower narrative
section is intended for inclusion in a cover letter to the awardee.
The cover letter will have standardized opening and closing sections.
The lower narrative section should be written in letter style form for
direct inclusion in the award letter.