Document:

Lydall, Inc. 2006 Performance Bonus Program

 Exhibit 10.33 
 Lydall, Inc. 
 PERFORMANCE BONUS PROGRAM – For Salaried Employees 
 This document sets forth the 2006 Performance Bonus Program applicable to Salaried Employees (“Employee”) of Lydall, Inc. and its subsidiaries as approved by the CEO of Lydall and the Compensation Committee
of Lydall’s Board of Directors (BOD), and is subject to audit by the Finance Department. Lydall’s Board of Directors will establish the Lydall Consolidated Earnings Per Share (EPS) threshold on an annual basis. 
  

	1.	Bonus Compensation Percentage for 2006 is the percentage of your Base Salary as determined on January 1st of each Program Year or date of hire for new entrants. Changes made to a Bonus Compensation Percentage will only be effective on January 1st of a Program Year. 

  

	2.	Bonus Allocation of your Bonus Compensation Percentage is as follows: 

  

							
	 Plan Factors
	  	Bonus Allocation
Percentage for those with
Milestones	 	 	Bonus Allocation
Percentage for those
without Milestones	 
	 Lydall Consolidated
	  	30	%	 	30	%
	 Business Unit
	  	45	%	 	70	%
	 Individual Milestones
	  	25	%	 		
		  	 	 	 	 	 
	 Total
	  	100	%	 	100	%
		  	 	 	 	 	 

 For CHQ employees, Lydall Consolidated is the Business Unit. 
  

	3.	Base Salary for 2006 is your year-to-date regular pay earned as an eligible participant, as indicated on your final paycheck in the current Program Year, plus any
separately recorded holiday and vacation pay. Pay earned as an hourly employee will not be included as part of this Program. Base Salary will be reduced by earnings attributed to any leave of absence. 

  

	4.	Bonus Program Qualifier Only when the company achieves the Lydall Consolidated Earnings per Share (EPS) threshold established by the board will program participants be
qualified for any bonus. Once the company achieves the Lydall Consolidated Earnings per Share (EPS) threshold, participants earn a bonus equal to 30% of their Bonus Compensation Percentage regardless of whether the Business Unit has achieved its
individual Threshold. 

  

	5.	Performance Exceeds Threshold The Business Unit Threshold is based on the Business Unit’s “Operating Income without Bonus” and is established by Senior
Management. Under the condition that the Lydall Consolidated EPS threshold is reached, once the “Business Unit Threshold” is exceeded, the participant is eligible to earn both the Business Unit award and Milestone portion on a Sliding
Scale as defined below. Additionally, the individual milestone award is only payable to the degree that the milestones have been achieved based on the assessment made by the Business Unit Head. 

  

	6.	Target Reaching Target for Operating Income (assuming EPS threshold has been reached) and completing 100% milestones will earn the participant 100% of their Bonus
Compensation Percentage. If Target Operating Income is exceeded, additional bonus can be earned on a prorated basis. However, in no case can the additional bonus payout be more than 50% of the incremental earnings above Target.

  

 1 

	7.	Sliding Scale  

 Actual minus
Threshold     =   ____% 
 Target minus Threshold 
  

	8.	Business Units  

  

	 	•	 	Corporate (CHQ) 

  

	 	•	 	North American Automotive 

  

	 	•	 	European Automotive 

  

	 	•	 	Rochester/St. Rivalain 

  

	 	•	 	Ossipee 

  

	 	•	 	Green Island 

  

	 	•	 	Transport 

  

	 	•	 	Charter Medical 

  

	9.	Thresholds and Targets are published at each location for the respective Business Unit. 

  

	10.	Payment Date The bonus will be paid within 30 days following the date on which Lydall’s public auditors have completed their year-end audit.

  

	11.	Active Employment Condition Bonus compensation is only payable to the Employee if they remain actively employed by a Lydall company through
December 31st of the applicable year-end. If the Employee is unable to carry out responsibilities through the
end of the applicable year due to death or disability, a pro-rated bonus will be earned. 

  

	12.	Termination Any bonus earned under this program will be eliminated by Lydall, if at any time the Employee is terminated by Lydall for “cause”.
“Cause” is defined as acts of dishonesty or fraud; conviction of a felony or crime involving moral turpitude; willful material breach of the employee’s duties and responsibilities; habitual neglect or insubordination; or breach of the
Non-competition and Confidentiality Agreement. 

  

	13.	No Guarantee Participation in the program provides no guarantee that a bonus under the program will be paid. No bonus will be paid to the extent that it would cause
the Company to violate any financial obligations it may have under any agreements. 

  

	14.	Modifications, Amendments, or Termination of the Program The Executive Bonus Committee, comprised of the Chief Executive Officer and the Chief Financial Officer, has
the sole authority to modify, amend, or terminate the provisions of this Program at any time, subject to BOD approval. 

  

 2Form of Option Agreement for stock options issued

 Exhibit 10.11 
 NONQUALIFIED STOCK OPTION 
 NONQUALIFIED STOCK OPTION AGREEMENT (“Agreement”) dated as of
                    , 200    , between MIDAS, INC., a Delaware corporation (the “Corporation”), and
                                 an employee of the Corporation or one of its
subsidiaries (the “Holder”). 
 WHEREAS, the Corporation desires, by affording the Holder an opportunity to purchase shares of the
Corporation’s Common Stock as hereinafter provided, [to carry out the purposes of the Corporation’s Stock Incentive Plan (the “Plan”), as amended and restated by the Board of Directors of the Corporation (the
“Board”) on May 10, 2005] [to carry out the purposes of the Corporation’s Treasury Stock Plan (the “Plan”), as adopted and established by the Board of Directors of the Corporation (the “Board”) on
May 9, 2002] [not as part of the Corporation’s Stock Incentive Plan (the “Plan”), as amended and restated by the Board of Directors of the Corporation (the “Board”) on May 10, 2005, but nevertheless in
accordance with the same terms and provisions of the Plan, which is hereby incorporated by reference]; and 
 WHEREAS, the Board has
duly made all determinations necessary or appropriate to the grant hereof. 
 NOW, THEREFORE, in consideration of the premises and the mutual
covenants hereinafter set forth and for other good and valuable consideration, receipt of which is hereby acknowledged, the parties hereto have agreed, and do hereby agree, as follows: 
 1. The Corporation hereby irrevocably grants to the Holder, as a matter of separate agreement and not in lieu of salary or any other compensation for
services, the right and option (the “Option”) to purchase
                                 THOUSAND
(            ) shares of Common Stock of the Corporation on the terms and conditions herein set forth. 
 2. For each of said shares purchased, the Holder shall pay to the Corporation $             per share (the “Option Price”). 
 3. Subject to the provisions of paragraphs 7, 8 and 9 hereof, this Option shall be for a term of ten years from the date of this Agreement and shall
become exercisable as to one-fifth of the shares covered by this Option on the first anniversary hereof, as to two-fifths of the shares covered by this Option on the second anniversary hereof (reduced by such number of shares as may have theretofore
been purchased hereunder), as to three-fifths of the shares covered by this Option on the third anniversary hereof (reduced by such number of shares as may have theretofore been purchased hereunder), as to four-fifths of the shares covered by this
Option on the fourth anniversary hereof (reduced by such number of shares as may have theretofore been purchased hereunder), and as to all shares covered by this Option and not theretofore purchased on the fifth anniversary hereof. The Corporation
shall not be required to issue any fractional shares upon exercise of this Option, and any fractional interests resulting from the calculation of the number of shares in respect of which this Option may be exercised prior to the fifth 

 
anniversary hereof shall be rounded down to the nearest whole share. Except as provided in paragraphs 7, 8 and 9 hereof, this Option may not be exercised
unless the Holder shall, at the time of exercise, be an employee of the Corporation or one of its “subsidiaries”, as defined in the Plan. 
 4. This Option may be exercised only by one or more notices in writing of the Holder’s intent to exercise this Option, accompanied by payment by check to the Corporation in an amount equal to the aggregate Option Price of the total
number of whole shares then being purchased. Unless otherwise specified by the Corporation, each such notice and check shall be delivered to the Treasurer of the Corporation, at the principal office of the Corporation or, at the risk of the Holder,
mailed to the Treasurer at said office. 
 5. Following the exercise of this Option, the Corporation will advise the Holder of the applicable
Federal and state income taxes required to be withheld by reason of such exercise. Thereupon, the Holder shall forthwith deliver to the Corporation a check payable to the Corporation or the subsidiary of the Corporation which employs the Holder, as
the case may be, representing said taxes. 
 6. This Option is not transferable by the Holder otherwise than by will or the laws of descent
and distribution and may be exercised, during the lifetime of the Holder, only by the Holder. 
 7. In the event of the termination of
employment of the Holder with the Corporation or one of its subsidiaries, other than by reason of Retirement (as defined in the Plan) or death, the Holder may exercise this Option at any time within three months (or one year, if the Holder is
permanently and totally disabled within the meaning of Section 22(e)(3) of the Federal Internal Revenue Code) after such termination of employment subject to paragraph 9 hereof, but only if and to the extent this Option was exercisable at the
date of termination, and in no event after the date on which this Option would otherwise terminate; provided, however, if such termination of employment was for cause or a voluntary termination without the written consent of the Corporation, then
this Agreement shall be of no further force or effect and all rights of the Holder under this Option shall thereupon cease. 
 8. In the
event of the termination of employment of the Holder with the Corporation or one of its subsidiaries by reason of Retirement, then all shares subject to this Option shall be fully exercisable, and, subject to paragraph 9 hereof, this Option shall be
exercisable by the Holder at any time up to and including (but not after) the date on which this Option would otherwise terminate. 
 9. In
the event of the death of the Holder (i) while employed by the Corporation or one of its subsidiaries or after Retirement, (ii) within three months after termination of the Holder’s employment (other than a termination by reason of
permanent and total disability within the meaning of Section 22(e)(3) of the Federal Internal Revenue Code), or (iii) within one year after termination of the Holder’s employment by reason of such disability, then this Option may be
exercised by the legatees under the last will of the Holder, or by the personal representatives or distributees of the Holder, at any time within a period of nine months after the Holder’s death, 

  

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but only if and to the extent this Option was exercisable at the date of death (unless death occurs while the Holder is employed by the Corporation or one of
its subsidiaries, in which case all shares subject to this Option shall be fully exercisable), and in no event after the date on which this Option would otherwise terminate. 
 10. Prior to the termination of this Option, in the event of a stock dividend, a spin-off, split-up, re-capitalization, merger, consolidation,
combination or exchange of shares, or the like, then the aggregate number and class of shares thereafter subject to this Option and the Option Price thereof, and the number and class of shares reserved for issuance pursuant to exercise hereof, shall
be appropriately adjusted by the Board, whose determination shall be conclusive. 
 11. This Option and each and every obligation of the
Corporation hereunder are subject to the requirement that if at any time the Corporation shall determine, upon advice of counsel, that the listing, registration, or qualification of the shares covered hereby upon any securities exchange or under any
state or Federal law, or the consent or approval of any governmental regulatory body, is necessary or desirable as a condition of or in connection with the granting of this Option or the purchase of shares hereunder, this Option may not be exercised
in whole or in part unless and until such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Board. 
 12. In the event of a “change in control” or a “Pooling Transaction”, as those terms are defined in the Plan, the Holder shall have
all of the rights specified in Paragraph 10(B) and, if applicable, Paragraph 10(D) of the Plan. 
 13. Nothing herein contained shall confer
on the Holder any right to continue in the employment of the Corporation or any of its subsidiaries or interfere in any way with the right of the Corporation or any subsidiary to terminate the Holder’s employment at any time; confer on the
Holder any of the rights of a shareholder with respect to any of the shares subject to this Option until such shares shall be issued upon the exercise of this Option; affect the Holder’s right to participate in and receive benefits under and in
accordance with the provisions of any pension, profit-sharing, insurance, or other employee benefit plan or program of the Corporation or any of its subsidiaries; or limit or otherwise affect the right of the Board (subject to any required approval
by the shareholders) at any time or from time to time to alter, amend, suspend or discontinue the Plan and the rules for its administration; provided, however, that no termination or amendment of the Plan may, without the consent of the Holder,
adversely affect the Holder’s rights under this Option. 
 14. The Board shall have the right to resolve all questions which may arise
in connection with this Option. Any interpretation, determination or other action made or taken by the Board regarding the Plan or this Option shall be final, binding and conclusive. 
 IN WITNESS WHEREOF, this Nonqualified Stock Option Agreement has been duly executed by the Corporation and the Holder as of the day and year first above
written. 
  

									
		 	MIDAS, INC.	 		 	Holder:
				
	By:	 	  
	 		 	  

		 	President and Chief Executive Officer	 		 	Name:	 	  

  

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