exv10w2






Exhibit 10.2




NORTEK, INC. 2012 SHORT-TERM CASH INCENTIVE PLAN

FOR NORTEK EXECUTIVES

(Under the Nortek, Inc. 2009 Omnibus Incentive Plan)




     The purpose of this 2012 Short-Term Cash Incentive Plan for Nortek Executives (Under the
Nortek, Inc. 2009 Omnibus Incentive Plan) (the “Plan”) is to provide incentives for certain
executives of Nortek, Inc. (the “Company”) to achieve a sustained, high level of financial success
and other measures of success for the Company. Awards under the Plan are granted pursuant to
Article 10 of the Nortek, Inc. 2009 Omnibus Incentive Plan.



I. ADMINISTRATION




     The Plan will be administered by the Compensation Committee of the Board of Directors of the
Company. The Compensation Committee is referred to herein as the “Committee.” The Committee may
delegate to other persons administrative functions that do not involve discretion. The Committee
shall have the authority to interpret this Plan, and any interpretation or decision by the
Committee with regard to any questions arising under the Plan shall be final and conclusive on all
participants in the Plan.



II. ELIGIBILITY; PARTICIPANTS




     The Board of Directors of the Company (the “Board”) shall select, from among those executive
officers of the Company, the persons who shall participate in the Plan (the “Participants”).



III. GRANT OF AWARDS




     The term “Award” as used in the Plan means a cash award opportunity that is granted to a
Participant with respect to the Company’s 2012 fiscal year. A Participant who is granted an Award
shall be entitled to a payment, if any, under the Award only if all conditions to payment have been
satisfied in accordance with the Plan and the terms of the Award. The Board or the Committee shall
establish the Performance Goals (as defined in Section IV below) applicable to each Award and the
amount or amounts that will be payable if the Performance Goals are achieved. The Committee shall
establish such other terms and conditions as it deems appropriate with respect to the Award.



IV. PERFORMANCE GOALS




     As used in the Plan, the term “Performance Goals” means each of (A) the Company’s 2012 fiscal
year financial performance goal as measured by Company Adjusted EBIDTA, as established by the Board
(the “Adjusted EBIDTA Goal”), and (B) one or more individual, personal objectives to be achieved in
fiscal year 2012 as established for each Participant by the Board (the “Personal Goals”).



     Adjusted EBITDA Goal. The Board shall establish the minimum, target and maximum
Adjusted EBIDTA Goals applicable to each Award and seventy percent (70%) of each Award shall be
based on the Company’s achievement of such Adjusted EBITDA Goals. The Board



 









 




shall also establish an Absolute Minimum Adjusted EBITDA amount, below which no Award under
the Plan, with respect to either Performance Goal, shall be paid.




     Personal Goals. With respect to Personal Goals, the Board shall, in its sole
discretion, establish a list of objectives for each Participant and assign a percentage to each,
with the assigned percentages totaling 30% (i.e., thirty percent (30%) of each Award shall be based
on the Participant’s achievement of his Personal Goals).



V. AMOUNT PAYABLE UNDER AWARDS




     At such time as the Company’s 2012 audited financial statements are approved by the Audit
Committee of the Board, the Committee, in its good faith judgment, shall determine whether and to
what extent, if at all, the Performance Goals applicable to each Award granted for such fiscal year
have been satisfied, including, but not limited to, the percentage achievement of the Adjusted
EBITDA Goal based upon the Company’s actual 2012 Adjusted EBITDA. The Committee shall then
determine the actual payment, if any, under each Award, by multiplying the percentage assigned to
each Performance Goal by the Participant’s target bonus, as established by the Board (the “Target
Bonus”). Appendix A sets forth the principles the Committee will use in determining the actual
payment, if any, under each Award.



VI. PAYMENT UNDER AWARDS




     A Participant’s right to payment will be treated as having vested if the Participant is
employed by the Company or one of its subsidiaries on December 31, 2012. If the Participant is not
employed by the Company or one of its subsidiaries on December 31, 2012, then any Award granted to
such Participant under the Plan will be immediately forfeited upon the Participant’s termination of
employment, without payment. All vested payments under the Plan will be made prior to March 15,
2013.



VII. MISCELLANEOUS




     (a) All payments under the Plan shall be subject to reduction for applicable tax and other
legally or contractually required withholdings.



     (b) The Committee may amend the Plan at any time and from time to time; provided, however,
that no such amendment shall adversely affect an Award granted to a Participant without such
Participant’s prior written consent.



     (c) Payments hereunder are intended to fall under the short-term deferral exception to Section
409A of the Internal Revenue Code of 1986, as amended, and the regulations thereunder, and shall be
construed and administered accordingly.



     (d) No person shall have any claim or right to be granted an Award, nor shall the selection
for participation in the Plan for the Company’s 2012 fiscal year be construed as giving a
Participant the right to be retained in the employ of the Company for that period or for any other
period.