RBC Bearings Inc.

(the “Company”)

 

Stock Ownership Guidelines

Effective June 14, 2013 (the “Effective Date”)

 

 

I. Purpose  

Effective June 14, 2013 , the Company’s Board of Directors approves these stock
ownership guidelines both for Non-Employee Independent Directors and for the
Company’s Executive Officers to align their interests with the interests of
stockholders and promote the Company’s commitment to sound corporate
governance. The Board of Directors believes that the Non-Employee Independent
Directors and the Company’s Executive Officers should have a significant equity
position in the Company and that these guidelines will serve to further the
Board of Director’s interest in encouraging a longer-term focus in managing the
Company.

 

II. Participation   These Stock Ownership Guidelines apply to all of the
Company’s Executive Officers that are subject to the Securities Exchange
Commission Section 16 reporting obligations and all Non-Employee Independent
Directors (each a “Participant”).       III. Determination of Guidelines  

Stock ownership guidelines are determined as a multiple of an Executive
Officers' base salary or a Non-Employee Independent Director’s annual retainer
in effect on the Effective Date and are then converted to a fixed number of
shares. The individual guidelines established for each Participant are as
follows:

 

 * Chairman and Chief Executive Officer - 6x annual base salary;
 * All Other Executive Officers - 3x annual base salary; and
 * Non-Employee Independent Directors - 3x annual retainer fee.

 

The Compensation Committee of the Company’s Board of Directors may, from time to
time, temporarily suspend, reevaluate and revise Participants’ guidelines to
give effect to changes in the Company’s common stock or other factors it deems
relevant.

 

IV. Counting Shares Owned  

Stock that counts towards satisfaction of the Company’s Stock Ownership
Guidelines includes:

•  Shares owned outright by the Participant or beneficially owned in a trust, by
a spouse and/or minor children residing in the same household;

•  Restricted stock issued and held as part of an Executive Officers' or a
Non-Employee Independent Director’s long term compensation, whether or not
vested; and

•  Shares acquired upon stock option exercises or vesting of restricted stock
that the Participant continues to hold.

 

 

 

 

V. Compliance with the Guidelines  

In determining whether the guidelines have been achieved at any particular
point, the price of the Common Stock will be the higher of (i) the then current
market value determined by the closing price of the Common Stock on the date of
the determination; or (ii) the closing price on the Effective Date, which was
$51.08.

 

Participants are required to achieve their Stock Ownership Guideline within five
years of becoming subject to the Guidelines. If a Participant’s Stock Ownership
Guideline increases because of a change in title, a five-year period to achieve
the incremental guideline begins in January following the year of the title
change. Once achieved, ownership of the guideline amount must be maintained for
as long as the individual is subject to these Stock Ownership Guidelines.

 

If a covered Executive Officers' or Non-Employee Independent Directors’ Stock
Ownership Guideline amount increases because of a change in title or increase in
base salary or retainer fee, a three (3) year period to achieve share ownership
meeting any incremental increase in the applicable Stock Ownership Guideline
amount begins with the date of the title change or base salary or retainer fee
increase.

 

The Compensation Committee will review each Participant’s compliance (or
progress towards compliance) with these Stock Ownership Guidelines annually. In
its sole discretion, the Compensation Committee may impose such conditions,
restrictions or limitations on any Participant as it determines to be necessary
or appropriate in order to achieve the purposes of these Stock Ownership
Guidelines. For example, the Compensation Committee may mandate that a
Participant retain (and not transfer) all or a portion of any shares delivered
to the Participant through the Company’s compensation plans or otherwise
restrict the Participant’s transfer of previously owned shares.

 

There may be instances in which the Stock Ownership Guidelines would place a
severe hardship on the Participant or prevent the Participant from complying
with a court order, such as a divorce settlement. In these instances, the
Participant must submit a request in writing to the Company’s General Counsel
that summarizes the circumstances and describes the extent to which an exemption
is being requested. The Compensation Committee will make the final decision as
to whether an exemption will be granted. If such a request is granted in whole
or part, the Company’s General Counsel will work with the Participant to develop
an alternative stock ownership plan that reflects the Compensation Committee’s
determination.

 

VI. Administration   These Stock Ownership Guidelines are interpreted by the
Compensation Committee and administered by the Company’s General Counsel