Exhibit 10.3

 

2010-2012 Long-Term Cash Award

 

Granted to:

«First» «Last»

Effective Date of Grant:

May 2010

Targeted Cash Award:

$

Performance Period:

January 1, 2010 – December 31, 2012

 

Under the long-term incentive program of W.R. Grace & Co (the “Company”), the
Compensation Committee (the “Committee”) of the Board of Directors of the
Company has granted you a Long-Term Cash Award under which you may earn a cash
payout in an amount equal to (or, in certain circumstances, greater or less
than) the Targeted Cash Award set forth above, over the Performance Period.

 

You will earn this Targeted Cash Award if the performance objectives described
in Annex B for the Performance Period are met.  If the performance objectives
are only partially achieved or are over-achieved, the amount you actually earn
under this Award will be decreased (or eliminated) or increased as set forth in
Annex B.

 

The award will be calculated and paid to you, net of the applicable taxes.

 

The consequences of a change in or termination of your employment status during
the Performance Period are described in the attached Administrative Practices
(Annex C).

 

In all matters regarding the administration of the Long-Term Incentive Award,
the Committee has full and sole jurisdiction, subject to the provisions of Annex
C.

 

Long-Term Incentive Awards are being granted only to a limited number of key
employees of the Company and its subsidiaries.  This Award should, consequently,
be treated confidentially.

 

 

 

W.R. Grace & Co.

 

 

 

[g98231kei001.jpg]

 

 

 

By:

 

 

 

Alfred Festa

 

Chairman, President and CEO

 

 

 

Acceptance of the foregoing is acknowledged this                          day of
                              , 2010.

 

 

 

 

 

 

 

(Signature of Participant)

 

 

 

 

 

 

 

(Please print full name)

 

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Annex B

 

Calculation of  2010-2012 LTIP- Cash Award

 

Your 2010-2012 Long Term Cash award payout will be based on the 3-year compound
annual growth rate (CAGR) in total Grace core earnings before interest and taxes
(core EBIT).  Payouts are contingent upon achievement of target CAGR for the
3-year performance period.  The target CAGR is 6%, using 2009 results as the
base year.

 

The core earnings before interest and taxes (core EBIT) in 2009 were $255.3
million.  The chart below details six scenarios at different assumed growth
rates.  The target growth is highlighted.

 

Assumed
Growth

 

Base
Period

 

Performance Period
Growth Targets

 

Total
Growth

 

Rates

 

2009

 

2010

 

2011

 

2012

 

10-12

 

 

 

 

 

 

 

 

 

 

 

 

 

1.50

%

255.3

 

259.1

 

263.0

 

267.0

 

789.1

 

 

 

 

 

 

 

 

 

 

 

 

 

3.00

%

255.3

 

263.0

 

270.8

 

279.0

 

812.8

 

 

 

 

 

 

 

 

 

 

 

 

 

6.00

%

255.3

 

270.6

 

286.9

 

304.1

 

861.6

 

 

 

 

 

 

 

 

 

 

 

 

 

10.00

%

255.3

 

280.8

 

308.9

 

339.8

 

929.5

 

 

 

 

 

 

 

 

 

 

 

 

 

15.00

%

255.3

 

293.6

 

337.6

 

388.3

 

1,019.5

 

 

 

 

 

 

 

 

 

 

 

 

 

25.00

%

255.3

 

319.1

 

398.9

 

498.6

 

1,216.6

 

 

Actual results for each year of the performance period are adjusted for the
change in pension expense and LITP expense as compared to the base period.

 

The Long-Term Cash Award payout will vary with actual results as shown in the
chart below:

 

CAGR Level Achieved

 

Payout
(rounded to the nearest whole
percentage)

 

 

 

 

 

25%

 

200%

 

 

 

 

 

15%

 

147%

 

 

 

 

 

10%

 

121%

 

 

 

 

 

6%

 

100%

 

 

 

 

 

3%

 

50%

 

 

 

 

 

3%<

 

Prorated

 

 

For the 2010-2012 LTIP, cash payments will be made in two installments – 50% of
what is earned based on performance for 2010 and 2011, but no more than 50% of
your target for the first two years, will be paid in March 2012, and the balance
will be paid in March 2013.

 

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Example:

 

A sample calculation of the Long-Term Cash Award Earned is provided below. 
Assume that your Targeted Cash Award is $20,400.  $13,600 would be earned after
Year 2 assuming a 6% growth per year.  Therefore the payment in March 2012 would
be $6,800, 50% of what is earned.

 

CAGR Level
Achieved

 

Payout in March
2012

 

Payout in March
2013

 

Total Payout

 

25

%

$

6,800

 

$

34,000

 

$

40,800

 

15

%

$

6,800

 

$

23,188

 

$

29,988

 

10

%

$

6,800

 

$

17,885

 

$

24,685

 

6

%

$

6,800

 

$

13,600

 

$

20,400

 

3

%

$

3,400

 

$

6,800

 

$

10,200

 

 

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