Business Development Incentive Policy

Abu Ghazaleh Intellectual Property
Financial and Accounting Policies – Business Development Incentive Policy

Abu-Ghazaleh Intellectual Property

Business Development Incentive Policy

For

National Marketing Officers

At

Abu-Ghazaleh Intellectual Property

January 2014

Prepared by

National Business Development Department - AGIP

Financial and Accounting Policies – New Engagements Incentive Policy

New Engagements Incentive Policy

First: Objectives:
This policy aims at promoting the business development of all activities (intellectual property activities) at the various AGIP companies and offices and to encourage AGIP marketing officers as well as the employees of the Group and the external consultants to exert extra efforts to obtain new clients, new engagements from present clients and to excel in serving the clients in order to retain them.

Second: Definition of Development Incentive:

It is an incentive granted to 1) any employee or manager working for Talal Abu Ghazaleh Group of Companies, 2) any employee or manager working for AGIP or 3) any third party in consideration of his/her efforts in obtaining a new service contract in any of the activities stated in the First item and /or client portfolio management and/or retaining the continuity of the client’s engagements.

Executive directors and office managers shall be excluded with regard to new engagements obtained for their offices and for the activities they are in charge of.

Third: Effective Date and Conditions of the Policy

1)  This policy shall supersede all previous policies related to the same subject at AGIP.

2)  This policy shall come onto force as from 1/1/2014.

3)  This policy shall be applicable to all new engagements obtained from clients.

4)  This policy shall remain valid as long as it realizes its goals and objectives and does not contradict the interests of companies of the Group in general. AGIP Management Committee shall determine such matters, if any, and shall submit its recommendations to suspend such incentives when necessary, provided that such suspension shall be formal under minutes of meeting, a copy of which shall be forwarded to the office managers.

5)  The new engagements incentive policy shall not be used in a manner contradicting the Group’s policy of accepting engagements and the amount of its fees or to have any negative impact on the quality of the services.

Fourth: Method of Calculating the Business Development Incentive

1-  Business development incentive shall be calculated at a rate of 5% of the net revenues of any new engagement. The relevant incentive shall be paid proportionate any amount collected with regard to such an engagement. The incentive is divided into two parts; the first part is related to identifying the new engagement which shall be worthy of 3% and the other part shall be 2% which shall due to AGIP national marketing manager or officer in charge of the client’s portfolio provided that he/she ensures continuity of the client’s services, client’s satisfaction without any complaints and acts as the direct or indirect contact with the client.

2-  The development incentive for all members of the Group against identification of a new engagement shall be 3%. The national marketing manager or officer in charge of the client’s portfolio provided that he/she ensures continuity of the client’s services, client’s satisfaction without any complaints and acts as the direct or indirect contact with the client shall be entitled to 2%.

3-  Third parties recruited as consultants shall be entitled to 8% in consideration of identifying a new engagement. The national marketing manager or officer in charge of the client’s portfolio provided that he/she ensures continuity of the client’s services, client’s satisfaction without any complaints and acts as the direct or indirect contact with the client shall be entitled to 2%.

4-  For calculating the above rates, the person entitled for the development incentive shall fill out Form No. 1 attached hereto whether in terms of identifying a new engagement, managing a client’s portfolio or an external consultant identifying a new engagement, which shall be approved by the Office Manager, the National Development Executive Director, the Accounts Manager and the Internal Audit.

5-  The incentive amount shall be calculated after deducting the official fees, granted discount, sales or any other tax, any other direct expenses , any other expenses and any charges paid to any third party participating the implementation of the new engagement.

6-  Once the client settles the full amount, the incentive amount on the professional charges shall be paid on all issued invoices as per provisions of Item No. 5 above.

7-  In case the client settles part of the due amount, the incentive amount on the professional charges as per Item No. 5 above shall be paid proportionate the collected amount of the issued invoices. The balance shall be paid once the full amount of the issued invoices is collected.

8-  No development incentive shall be due on engagements obtained through bids and tenders.

Fifth: Implementation Procedures:

1-  A report shall be prepared for every new engagement by the person in charge of the new engagement identification or management and shall be addressed to the office manager vide the attached form for approval after verification.

2-  The above mentioned report shall be completed by the office manager as soon as a new engagement is obtained.

3-  The report duly approved by the office manager shall be sent to the National Development Department for verification of entitlement, records and correspondence.

4-  The report duly approved by the office manager and the National Development Department shall be sent to the Accounts Department at the General Administration for calculation purposes.

5-  The approved report, together with the calculation made by the Accounts Department shall be sent to the Internal Audit Department to ensure the sound application of the procedures, compliance with the policy, sound calculations and final approval.

6-  The Accounts Department at the General Administration shall instruct the respective office to pay.

7-  The incentive of the employee on the new engagements whose fees or part thereof are not collected shall be forfeited upon the services of such an employee come to an end with the company unless he assists in collecting such amounts before the termination of his/her services.

Sixth: Required Enclosures:

1-  Engagement Identification and/or Management Form duly signed by the office manager.

-  Client name and number.

-  Name of the person entitled for the incentive.

-  Date of introducing the client.

-  Type of the required engagement.

-  Respective country.

-  Amount paid in advance.

2-  Copies of the issued invoices. (obtainable from the Regional Office)

National Business Development Department Jan. 7, 2014Page 5