Executive Incentive Compensation Program
Fiscal Year 2005
The intention of the Executive Incentive Compensation Program for Fiscal Year 2005 is to provide incentives to eligible
Exar Corporation executives for achieving or surpassing established revenue and pre-tax profit goals derived from the FY
2005 Financial Plan. (see Attachment 1, FY 2005 Financial Plan).
2.0 Management Participant Qualifications
2.1 Direct participation is limited to a small group of executives who have an important influence on the operation, profits,
and future of Exar. Generally, only the corporate officers and the directors of major staff or line functions may be
2.2 Participation shall be recommended by the President/CEO and is subject to concurrence by the Compensation
Committee of the Board of Directors.
3.0 Funding of the Incentive Plan Pool
2.3 An invitation to participate and the information divulged in connection with the program must be considered private
and not be discussed with others.
The Incentive Plan Pool will be funded upon achievement of certain revenue and pre-tax profit goals. The pre-tax
profit goal must be met at the pre-established threshold levels before any pool funding takes place. Further, this plan
will not be funded unless there is funding and payout for the Fiscal Year 2005 Key Employee Incentive Program.
3.2 Calculation for Pool Funding
The size of the executive pool is the sum of the fiscal year 2005 annual base salary of the participants times their
respective target award percentages. The pool size will be modified according to the actual revenue and profit
performance levels compared to the approved financial plan for fiscal year 2005. Use the table in Attachment 2 to
determine the pool size. For example, if the actual revenue level were [***], the pool for revenue achievement would
be [***]. If the pre-tax pr