Document:

EX-10.3

 Exhibit 10.3 

THE L. B. FOSTER COMPANY 

2013 
 EXECUTIVE
ANNUAL INCENTIVE COMPENSATION PLAN 
 The purpose of this document is to establish in writing the 2013 performance goals and other
terms applicable to the 2013 awards authorized under the L. B. Foster Company Executive Annual Incentive Compensation Plan (“Plan”) for the Fiscal Year (as defined below). 

 

	I.	DEFINITIONS 

 Capitalized terms not otherwise defined herein shall have the meaning
ascribed thereto in the Plan. The following terms shall be defined as follows: 
 1.1 “Company” shall mean L. B. Foster
Company and those subsidiaries thereof in which L. B. Foster Company owns 100% of the outstanding common stock. 
 1.2
“Operating Unit” shall mean the Company’s units or divisions which are reported in the Company’s internal financial statements and set forth in Schedule 1.10. 

1.3 “Component” of any Operating Unit shall be as set forth in Schedule 1.10. 

1.4 “Financial Performance Award” shall mean an award, as determined for each Participant, equal to (i) the
“Participant’s Target Incentive” multiplied by (ii) the applicable aggregate percentage specified for Financial Performance Awards under Section 3.2, the payment of which shall be contingent solely upon the attainment of the
objective financial performance goals established by the Committee for Corporate and Operating Unit Pre-Tax Income, Corporate and Operating Unit Working Capital as a Percentage of Sales, and Corporate ROIC for the Fiscal Year as set forth in
Schedule 1.10. 
 1.5 “Base Compensation” shall mean the total base salary, rounded to the nearest whole dollar,
actually paid to a Participant during the Fiscal Year, excluding incentive compensation, commissions, reimbursement of expenses, severance, car allowances or all other payments not deemed part of a Participant’s base salary; provided, however,
that the Participant’s contributions to the Company’s 401(k) plan(s) and the payment of overtime shall be included in Base Compensation. To the extent applicable, Base Compensation for Participants who terminate during the Fiscal Year
shall include only such Base Compensation paid to such Participants during the Fiscal Year for the period prior to such termination. 

1.6 “Participant” shall mean all executive officers of the Company set forth on Schedule 1.11. 

1.7 “Participant’s Target Incentive” shall mean the product of the Base Compensation of a Participant multiplied by the
target percentage established for a Participant pursuant to section 3.1 hereof. 

 1.8 “Fiscal Year” means the 2013 calendar year (January 1, 2013 through
December 31, 2013). 
 1.9 “Pre-Tax Income” shall mean the pre-tax income for the Fiscal Year, determined in
accordance with generally accepted accounting principles, including the applicable LIFO charge or credit but excluding: (i) any favorable adjustments related to the Grand Island produced concrete ties; (ii) all gains or losses arising from
sales of capital assets when the sales price of an individual asset exceeds $200,000; (iii) all expenses, costs, profits, losses or gains (exclusive of travel) attributable to (a) the sale (or attempted sale), other than sales of inventory
in the ordinary course of business, of more than 25% of the assets of an “Operating Unit” or 50% of the assets of a Component in the Fiscal Year, or (b) the acquisition, or unsuccessful attempted acquisition, of a business in the
Fiscal Year; (iv) the costs of the Plan for domestic Operating Units; and (v) investment income or losses arising from non-operating investments of cash pursuant to the Company’s investment policy. Notwithstanding the foregoing, in
the event more than 25% of the assets of an Operating Unit or 50% of the assets of a Component are sold, excluding sales of inventory in the ordinary course of business, during the Fiscal Year, such Operating Unit’s or Component’s, as
applicable, Plan Target and Actual Pre-Tax Income shall be eliminated from all calculations. 
 1.10 “Working Capital as a
Percentage of Sales” (“W/C as a % of Sales”) shall mean with respect to the Company, or as applicable, for an Operating Unit, for the Fiscal Year, the average monthly balances of Inventory and Accounts Receivable less the average
monthly balances of Accounts Payable and Deferred Revenue divided by annual net sales. 
 1.11 “Return on Invested
Capital” (“ROIC”) shall mean, with respect to the Company for the Fiscal Year: (A) after tax earnings from continuing operations before interest income and interest expense and amortization charges and any costs recognized
related to a purchase accounting step up in the basis of tangible or intangible assets not classified as amortization (tax affected using the effective corporate tax rate) and excluding: (i) any favorable adjustments related to the Grand Island
produced concrete ties; (ii) all expenses, costs, profits, losses, and gains (exclusive of travel) attributable to (a) the sale, excluding sales of inventory in the ordinary course of business, of more than 25% of the assets of an
“Operating Unit” or, more than 50% of the assets of a Component, or (b) the acquisition, or unsuccessful attempted acquisition, of a business in 2013, divided by (B) an average of month end total assets less the sum of cash,
marketable securities and non-interest bearing current liabilities, determined in accordance with generally accepted accounting principles. 

1.12 “Target Working Capital as a Percent of Sales (Corporate and Operating Unit), Target Pre-Tax Income (Corporate and Operating
Unit), and Target ROIC” shall mean the respective targets as set forth in Schedule 1.10. 

  
 2 

	II.	ELIGIBILITY 

 2.1 Additional Conditions. Subject to the terms and conditions set
forth herein and in the Plan and unless the Committee determines otherwise, in its sole discretion, a Participant’s right, if any, to receive payment of their respective Financial Performance Awards shall also be contingent upon satisfaction of
each of the following requirements: 
 a. A Participant must execute a Confidentiality, Intellectual Property and
Non-Compete Agreement in a form satisfactory to the Committee and deliver the executed agreement to the Company’s Vice President – Human Resources on or before October 1 of the applicable Fiscal Year. If a Participant previously has
executed a Confidentiality, Intellectual Property and Non-Compete Agreement, the Participant need not execute and deliver another Confidentiality, Intellectual Property and Non-Compete Agreement. 

b. A Participant’s Target Percentage award shall be as set forth in Section 3.1. In the event a Participant changes
from one position to another position set forth in Section 3.1 or is promoted into one of the positions set forth in Section 3.1 during the Fiscal Year performance period, the Target Percentage for such Participant shall be pro-rated
between the Target Percentages of each position held during the Fiscal Year based on which position was held on the first day of each month in the Fiscal Year performance period and may be allocated among different Operating Units as determined by
the Committee. Any newly hired Participant shall have a Target Percentage as set forth in Section 3.1, provided their employment began in such position by October 1 of the Fiscal Year performance period. 

c. Except as otherwise determined by the Committee, if a Participant’s employment terminates with the Company prior to the
Payment Date, the Participant shall forfeit any and all rights to payment or any Financial Performance Award granted hereunder. 
  

	III.	AWARDS 

 3.1 Target Percentages. Each Participant shall have a Target Percentage
based upon the position held by such Participant, as follows: 
  

					
	 Title*
	  	Target Percentage	 
	 Other
	  	 	**	  
	 Controller or Executive Director
	  	 	30	% 
	 Vice President; CXT President
	  	 	40	% 
	 Sr. Vice President
	  	 	50	% 
	 Sr. Vice President & CFO or Executive Vice President
	  	 	55	% 
	 Chief Executive Officer
	  	 	75	% 

  

	*	Refers solely to officers of L.B. Foster Company and not, except with respect to CXT President, officers of a subsidiary. 

	**	As determined by the Committee. 

  
 3 

 Other employees selected by the Committee may also be made Participants in the Plan on such terms
as may be approved by the Committee and consistent with the terms of the Plan. 
 3.2 Target Amount. The target amount of a
Participant’s Financial Performance Award, if any, shall be determined and allocated based on the percentages specified in the table below (and Schedule 1.10) 
  

											
	 	  	 Metric
	  	CEO, Sr VP & CFO;
Sr VP-Operations; VP-
Business 
Development;
VP-Human
Resources; VP &
General Counsel; and
Controller	 	 	VP’s and
Sr VP
Responsible for
Operating Unit(s)	 
		  	Corporate ROIC	  	 	15	% 	 	 	—  	  
	 Financial Performance Awards
	  	Operating Unit Pre-Tax Income	  	 	—  	  	 	 	50	% 
		  	Working Capital as a % of Sales	  	 	15	% 	 	 	20	% 
		  	Corporate Pre-Tax Income	  	 	70	% 	 	 	30	% 

 3.3 Financial Performance Award Multiplier. Subject to the terms and conditions set forth herein and in
the Plan, the amount of Financial Performance Award earned shall be calculated and adjusted upward or downward based on the actual level of attainment of Target W/C as a % of Sales (Corporate and Operating Unit), Target Pre-Tax Income (Corporate and
Operating Unit) and/or Target ROIC (as allocated under Section 3.2) utilizing the percentage multiplier as set forth in the following tables: 
  

	 	a.	Pre-Tax Income Multiplier (Corporate/Operating Unit) 

  

					
	 % of Target Pre-Tax Income
	  	Corporate or
Operating Unit
Multiplier	 
	 170% and over
	  	 	200	% 
	 160%
	  	 	185	% 
	 150%
	  	 	175	% 
	 140%
	  	 	160	% 
	 130%
	  	 	145	% 
	 120%
	  	 	130	% 
	 110%
	  	 	115	% 
	 100%
	  	 	100	% 
	 90%
	  	 	84	% 
	 80%
	  	 	68	% 
	 70%
	  	 	52	% 
	 60%
	  	 	36	% 
	 50%
	  	 	20	% 
	 Less than 50%
	  	 	0	% 

  
 4 

	 	b.	ROIC Multiplier 

  

					
	 % of Target ROIC
	  	ROIC Multiplier	 
	 127.5% and over
	  	 	200	% 
	 123.0%
	  	 	167	% 
	 112.8%
	  	 	133	% 
	 100.0%
	  	 	100	% 
	 93.7%
	  	 	73	% 
	 87.8%
	  	 	47	% 
	 80.0%
	  	 	20	% 
	 Less than 80.0%
	  	 	0.0	% 

  

	 	c.	W/C as a % of Sales Multiplier 

  

					
	 % of Target Average W/C as

a % of Sales
	  	Corporate or
Operating Unit
Multiplier	 
	 86.0% and under
	  	 	200	% 
	 88.7%
	  	 	175	% 
	 91.3%
	  	 	150	% 
	 94.3%
	  	 	130	% 
	 97.4%
	  	 	115	% 
	 100.0%
	  	 	100	% 
	 102.9%
	  	 	80	% 
	 106.5%
	  	 	60	% 
	 110.0%
	  	 	40	% 
	 Greater than 110.0%
	  	 	0	% 

 The calculation of the multiplier(s) in the above tables shall be adjusted proportionately to reflect whole
percentages achieved between the levels in the table. For example, if Corporate achieved 73% of Target Pre-Tax Income, the multiplier would be 57%; if Corporate achieved 137% of Target Pre-Tax Income, the multiplier would be 156%. 

3.4 Limitation on Financial Performance Award. Notwithstanding any provision to the contrary, a Participant’s Financial Performance
Award shall not exceed $1,000,000 for any Participant for the Fiscal Year performance period under the Plan. In the event that the amount of any such award for the Fiscal Year earned exceeds $1,000,000 for a Participant, such award shall be reduced
to $1,000,000. 

  
 5 

	IV.	RECOUPMENT 

 In the event the Company is required to prepare an accounting restatement
applicable to any financial reporting period covering a period within the Fiscal Year due to the material noncompliance of the Company with any financial reporting requirement under the securities laws or other applicable law and if the Committee,
in its discretion, so determines, each “Specified Participant” (as defined below) shall pay to the Company, in cash, all cash paid to or on behalf of such Participant under the Plan for the Fiscal Year in excess of the amount of such
compensation that would have been paid to the Participant for the Fiscal Year based on the restated financial results. Any such payment shall be made within the time periods prescribed by the Committee. The term “Specified Participant”
means any Participant that the Committee has determined, in its sole discretion, has committed fraud, negligence, or intentional misconduct that was a significant contributing factor to the Company having to prepare an accounting restatement. A
Specified Participant’s failure to make any such timely payment to the Company constitutes an independent and material breach of the terms and conditions of the Plan, for which the Company may seek recovery of the unpaid amount as liquidated
damages, in addition to all other rights and remedies the Company may have against the Participant. By participating in the Plan, each Participant agrees that timely payment to the Company as set forth in this Section IV is (i) reasonable and
necessary, (ii) is not a penalty, and (iii) does not preclude the Company from seeking all other remedies that may be available to the Company. 

The Committee, in its discretion, shall determine whether the Company shall effect any such recovery (i) by seeking repayment from the
Specified Participant, (ii) by reducing (subject to applicable law and the terms and conditions of the applicable plan, program or arrangement) the amount that would otherwise be payable to the Specified Participant under any compensatory plan,
program or arrangement maintained by the Company or any of its affiliates, (iii) by withholding payment of future increases in compensation (including the payment of any discretionary bonus amount) or grants of compensatory awards that would
otherwise have been made in accordance with the Company’s otherwise applicable compensation practices, or (iv) by any combination of the foregoing. 

Notwithstanding any other provisions of this document, if the awards granted pursuant to this document become subject to recovery under any
Company policy adopted hereafter and required by law, regulation or stock exchange listing requirement, the awards shall be subject to such deductions, recoupment, and clawback as may be required to be made pursuant to such Company policy (the
“Clawback Requirement”). In the event the awards granted pursuant to this document and the Plan become subject to such Clawback Requirement, then the awards shall be subject to such Clawback Requirement, and this Section IV shall no longer
apply to such awards. 
 Notwithstanding the foregoing, the Company shall not be required to make any additional payment in the event
that the restated financial results would have resulted in a greater payment to any Participant. 

  
 6 

	V.	COMPENSATION COMMITTEE 

 All determinations with respect to any Financial Performance
Award shall be made by the Committee and shall be final, conclusive and binding on the Company, the Participant and any and all interested parties. No payment of a Financial Performance Award shall be made prior to the Committee certifying in
writing that the performance goals and other material terms applicable to such awards for the Fiscal Year as set forth herein (including the Schedules attached hereto) have been attained. 

The undersigned Chairman of the Committee hereby certifies, on behalf of the Committee, that the performance goals and other material terms
applicable to the awards for the Fiscal Year as set forth herein (including the Schedules attached hereto) have been determined and approved at the Committee meeting of even date herewith. 

 

			
	 By:
	 	/s/ William H. Rackoff
		 	William H. Rackoff
		 	Chairman, Compensation Committee
		
	 Date:
	 	02/26/13

  
 7EX-10.4

 Exhibit 10.4 

THE L. B. FOSTER COMPANY 2012 

EXECUTIVE ANNUAL INCENTIVE COMPENSATION PLAN 

The purpose of this document is to establish in writing the 2012 performance goals and other terms applicable to the 2012 awards authorized
under the L. B. Foster Executive Annual Incentive Compensation Plan (“Plan”). 
  

	I.	DEFINITIONS 

 Capitalized terms not otherwise defined herein shall have the meaning
ascribed thereto in the Plan. The following terms shall be defined as follows: 
 1.1 “Corporation” shall mean L. B. Foster
Company and those subsidiaries thereof in which L. B. Foster Company owns 100% of the outstanding common stock. 
 1.2 “Operating
Unit” shall mean the Corporation’s units or divisions which are reported in the Corporation’s internal financial statements and set forth in schedule 1.10. 

1.3 “Component” of any Operating Unit shall be as set forth in Schedule 1.10. 

1.4 “Financial Performance Award” shall mean an award, as determined for each Participant, equal to (i) the
“Participant’s Target Incentive” multiplied by (ii) the applicable aggregate percentage specified for Financial Performance Awards under Section 3.2, the payment of which shall be contingent solely upon the attainment of the
objective financial performance goals established by the Committee for Pre-Tax Income, Working Capital as a Percentage of Sales, Operating Unit ROA and Coporate ROIC for the Fiscal Year. 

1.5 “Base Compensation” shall mean the total base salary, rounded to the nearest whole dollar, actually paid to a Participant
during the Fiscal Year, excluding incentive compensation, commissions, reimbursement of expenses, severance, car allowances or all other payments not deemed part of a Participant’s base salary; provided, however, that the Participant’s
contributions to the Corporation’s 401(k) plan(s) and the payment of overtime shall be included in Base Compensation. To the extent applicable, Base Compensation for Participants who terminate during the Fiscal Year shall include only such Base
Compensation paid to such Participants during the Fiscal Year for the period prior to such termination. 
 1.6 “Participant”
shall mean all executive officers of the Corporation pursuant to Schedule 1.11, as amended by the Compensation Committee. 
 1.7
“Participant’s Target Incentive” shall mean the product of the Base Compensation of a Participant multiplied by the target percentage established for a Participant pursuant to section 3.1 hereof. 

1.8 “Fiscal Year” means the 2012 calendar year. 

1.9 “Operating Unit Return on Assets” shall mean the return on assets of an Operating Unit for the Fiscal Year, determined by
dividing Operating Unit Pretax Income determined in accordance with generally accepted accounting principles, by the average assets employed in the Operating Unit (typically consisting of accounts receivable, inventory, accounts payable, deferred
revenue, property, plant and equipment, and certain intangible assets in the same manner as calculated in the Corporation’s annual operating plan. 

 1.10 “Pre-Tax Income” shall mean the pre-tax income for the Fiscal Year,
determined in accordance with generally accepted accounting principles, including the applicable LIFO charge or credit but excluding: (i) any adjustments included in pre-tax income related to the Dakota Minnesota and Eastern Railroad
Corporation (“DM&E”) arising from or in connection with the 2007 merger of the DM&E; (ii) all gains or losses arising from sales of capital assets when the sale or purchase price for an individual asset exceeds $200,000;
(iii) all expenses, costs, profits, losses or gains (exclusive of travel) attributable to (a) the sale (or attempted sale); other than sales of inventory in the ordinary course of business, of more than 25% of the assets of an
“Operating Unit” or 50% of the assets of a Component in the Fiscal Year, or (b) the acquisition, or unsuccessfully attempted acquisition, of a business in 2012 ; (iv) the costs of the Plan for non-Portec Operating Units;
(v) the costs related to the Company’s new CEO for items such as compensation and relocation that are in excess of the costs budgeted in the 2012 Annual Operating Plan; and (vi) investment income or losses arising from non-operating
investments of cash pursuant to the Company’s investment policy. Notwithstanding the foregoing, in the event more than 25% of the assets of an Operating Unit or 50% of the assets of a Component are sold, excluding sales of inventory in the
ordinary course of business, during the Fiscal Year, such Operating Unit’s or Component’s, as applicable, Plan Target and Actual Pre-Tax Income shall be eliminated from all calculations. 

1.11 “Working Capital as a Percentage of Sales” (“W/C as a % of Sales”) shall mean with respect to the Corporation,
or as applicable, for an Operating Unit, for the Fiscal Year, the average monthly balances of Inventory and Accounts Receivable less the average monthly balances of Accounts Payable and Deferred Revenue divided by annual net sales. 

1.12 “Return on Invested Capital” (“ROIC”) shall mean, with respect to the Corporation for the Fiscal
Year: (A) after tax earnings from continuing operations before interest income and interest expense and amortization charges and any costs recognized related to a purchase accounting step up in the basis of tangible or intangible assets not
classified as amortization (tax affected using the effective corporate tax rate) and excluding: (i) all adjustments related to the DM&E arising from or in connection with the 2007 merger of the DM&E; (ii) all expenses, costs,
profits, losses, and gains (exclusive of travel) attributable to (a) the sale, excluding sales of inventory in the ordinary course of business, of more than 25% of the assets of an “Operating Unit” or, more than 50% of the assets of a
Component, or (b) the acquisition, or unsuccessfully attempted acquisition, of a business in 2012, divided by (B) an average of month end total assets less the sum of cash, marketable securities and non-interest bearing current
liabilities, determined in accordance with generally accepted accounting principles.  
 1.13 “Target Operating Unit ROA,
Target Working Capital as a Percent of Sales, Target Pre-Tax Income (Corporate and Operating Unit), and Target ROIC” shall mean the respective targets as set forth in Schedule 1.10. 

  
 2 

	II.	ELIGIBILITY 

 2.1 Additional Conditions. Subject to the terms and conditions set
forth herein and in the Plan and unless the Compensation Committee determines otherwise, in its sole discretion, a Participant’s right, if any, to receive payment of their respective Financial Performance Award shall also be contingent upon
satisfaction of each of the following requirements: 
 a. A Participant must execute a Confidentiality, Intellectual Property
and Non- Compete Agreement and a recoupment/claw-back agreement, in a form satisfactory to the Compensation Committee and delivered the executed agreement to the Company’s Vice President – Human Resources on or before June 30 of the
applicable Fiscal Year. If a Participant previously has executed Confidentiality, Intellectual Property and Non-Compete Agreement, the Participant need not execute and deliver another Confidentiality, Intellectual Property and Non-Compete Agreement.

 b. A Participant’s Target Percentage shall be based on the position held by the Participant on July 1 of the
Fiscal Year and may be allocated among different Operating Units. Those Participants who are not employed due to a death, Retirement or Total and Permanent Disability (as defined in the Plan) occurring prior to July 1 of the Fiscal Year shall,
subject to the terms and conditions of the Plan, have a Target Percentage based upon their grade level at death, Retirement, or Total and Permanent Disability (as defined in the Plan). 

c. A Participant may not have: (i) been terminated for cause; (ii) voluntarily resigned (other than due to retirement
with the Company’s consent) prior to the date Individual Incentive awards are paid; (iii) been terminated for any reason whatsoever and have received money from the Corporation in connection with said termination. (iv) unless the
Corporation agrees in writing that the employee shall remain a Participant in this Plan, 
  

	III.	AWARDS 

 3.1 Target Percentages. Each Participant shall have a Target Percentage
based upon the position held by such Participant, as follows: 
  

					
	 Title*
	  	Target Percentage	 
	 Other
	  	 	**	  
	 Controller
	  	 	30	% 
	 Vice President; CXT President
	  	 	40	% 
	 Sr. Vice President
	  	 	50	% 
	 Sr. Vice President & CFO
	  	 	55	% 
	 Chief Executive Officer
	  	 	75	% 

  

	*	Refers solely to officers of L.B. Foster Company and not, except with respect to CXT President, officers of a subsidiary.

	**	As determined by the Compensation Committee of the Board of Directors. 

  
 3 

 A Participant’s Target Percentage shall be based on the position held by the Participant on
October 1 of the Fiscal Year and may be allocated among different Operating Units. Those Participants who are not employed due to a death, Retirement or Total and Permanent Disability (as defined in the Plan) occurring prior to July of the
Fiscal Year shall, subject to the terms and conditions of the Plan, have a Target Percentage based upon their position at death, Retirement, or Total and Permanent Disability (as defined in the Plan). 

Other employees selected by the Committee may also be made Participants in the Plan on such terms as may be approved by the Committee and
consistent with the terms of the Plan. 
 3.2 Target Amount. The target amount of a Participant’s Financial Performance Award, if
any, shall be determined and allocated based on the percentages specified in the table below (and Schedule 1.11) 
  

											
	 	  	 Metric
	  	CEO, Sr VP & CFO;
Sr VP-Operations;
VP-Business
Development; VP-
Human Resources;
VP & General
Counsel;
and
Controller	 	 	VP’s and
Sr VP
Responsible for
Operating Unit(s)	 
		  	Corporate ROIC	  	 	15	% 	 	 	—	  
	 Financial Performance Awards
	  	Operating Unit Pre-Tax Income	  	 	—  	  	 	 	40	% 
	  	Operating Unit Return on Assets	  	 	—  	  	 	 	15	% 
	  	Working Capital as a % of Sales	  	 	15	% 	 	 	15	% 
		  	Corporate Pre-Tax Income	  	 	70	% 	 	 	30	% 

  

	(1)	In the case of CXT, achievement measures will be divided equally between Ties and Buildings. 

3.3 Financial Performance Award Multiplier. Subject to the terms and conditions set forth herein and in the Plan, the amount of
Financial Performance Award earned shall be calculated and adjusted upward or downward based on the actual level of attainment of Target Operating Unit ROA, Target W/C as a % of Sales, Target Pre-Tax Income and/or Target ROIC (as allocated under
Section 3.2) utilizing the percentage multiplier as set forth in the following tables: 

  
 4 

	 	a.	Pre-Tax Income Multiplier (Corporate/Operating Unit) 

  

					
	% of Target Pre-Tax	  	Corporate or Operating	 
	 Income
	  	Unit Multiplier	 
	 170% and over
	  	 	200	% 
	 160%
	  	 	185	% 
	 150%
	  	 	175	% 
	 140%
	  	 	160	% 
	 130%
	  	 	145	% 
	 120%
	  	 	130	% 
	 110%
	  	 	115	% 
	 100%
	  	 	100	% 
	 90%
	  	 	84	% 
	 80%
	  	 	68	% 
	 70%
	  	 	52	% 
	 60%
	  	 	36	% 
	 50%
	  	 	20	% 
	 Less than 50%
	  	 	0	% 

  

	 	b.	ROIC Multiplier 

  

					
	 Target ROIC Achieved
	  	Corporate Multiplier	 
	 16.25% and Over
	  	 	200	% 
	 15.7%
	  	 	167	% 
	 14.38%
	  	 	133	% 
	 12.75%
	  	 	100	% 
	 11.95%
	  	 	73	% 
	 11.20%
	  	 	47	% 
	 10.20%
	  	 	20	% 
	 Less than 10.20%
	  	 	0.0	% 

  

	 	c.	W/C as a % of Sales Multiplier 

  

					
	 % of Target Average W/C as

a % of Sales
	  	Corporate or Operating
Unit Multiplier	 
	 86.0% and under
	  	 	200	% 
	 88.7%
	  	 	175	% 
	 91.3%
	  	 	150	% 
	 94.3%
	  	 	130	% 
	 97.4%
	  	 	115	% 
	 100.0%
	  	 	100	% 
	 102.9%
	  	 	80	% 
	 106.5%
	  	 	60	% 
	 110.0%
	  	 	40	% 
	 Greater than 110.0%
	  	 	0	% 

  
 5 

	 	d.	Operating Unit Return on Assets 

  

					
	 ROA Achieved
	  	Operating Unit Multiplier	 
	 133% and over
	  	 	200	% 
	 122%
	  	 	167	% 
	 111%
	  	 	133	% 
	 100%
	  	 	100	% 
	 93.0%
	  	 	93	% 
	 86.0%
	  	 	47	% 
	 80%
	  	 	20	% 
	 Less than 80%
	  	 	0.0	% 

 The calculation of the multiplier(s) in the above tables shall be adjusted proportionately to reflect
percentages achieved between the levels in the table. For example, if Corporate achieved 73% of Target Pre-Tax Income, the multiplier would be 56.8%; if Corporate achieved 137% of Target Pre-Tax Income the multiplier would be 155.5%. 

3.4 Limitation on Financial Performance Award. Notwithstanding any provision to the contrary, a Participant’s Financial Performance
Award shall not exceed $1,000,000 for any Participant. In the event that the amount of any such award earned exceeds $1,000,000 for a Participant, such award shall be reduced to $1,000,000. 

 

	IV.	RECOUPMENT 

 In the event the Company is required to prepare an accounting restatement
applicable to any financial reporting period covering a period within the Fiscal Year due to the material noncompliance of the Company with any financial reporting requirement under the securities laws or other applicable law and if the Committee,
in its discretion, so determines, each “Specified Participant” shall pay to the Company, in cash, all cash paid to or on behalf of such Participant under the Plan for the Fiscal Year in excess of the amount of such compensation that would
have been paid to the Participant for the Fiscal Year based on the restated financial results. Any such payment shall be made within the time periods prescribed by the Committee. The term “Specified Participant” means any Participant that
the Committee has determined, in its sole discretion, has committed fraud, negligence, or intentional misconduct that was a significant contributing factor to the Company having to prepare an accounting restatement. A Specified Participant’s
failure to make any such timely payment to the Company constitutes an independent and material breach of the terms and conditions of the Plan, for which the Company may seek recovery of the unpaid amount as liquidated damages, in addition to all
other rights and remedies the Company may have against the Participant. By participating in the Plan, each Participant agrees that timely payment to the Company as set forth in this Section III is (i) reasonable and necessary, (ii) is not
a penalty, and (iii) does not preclude the Company from seeking all other remedies that may be available to the Company. 

  
 6 

 The Compensation Committee, in its discretion, shall determine whether the Company shall effect
any such recovery (i) by seeking repayment from the Specified Participant, (ii) by reducing (subject to applicable law and the terms and conditions of the applicable plan, program or arrangement) the amount that would otherwise be payable
to the Specified Participant under any compensatory plan, program or arrangement maintained by the Company or any of its affiliates, (iii) by withholding payment of future increases in compensation (including the payment of any discretionary
bonus amount) or grants of compensatory awards that would otherwise have been made in accordance with the Company’s otherwise applicable compensation practices, or (iv) by any combination of the foregoing. 

Notwithstanding the foregoing, the Company shall not be required to make any additional payment in the event that the restated financial
results would have resulted in a greater payment to any Participant. 
  

	IV.	COMPENSATION COMMITTEE 

 All determinations with respect to any Financial Performance
Award shall be made by the Compensation Committee and shall be final, conclusive and binding on the Corporation, the Participant and any and all interested parties. No payment of a Financial Performance Award shall be made prior to the Committee
certifying in writing that the performance goals and other material terms applicable to such awards for the Fiscal Year as set forth herein (including the Schedules attached hereto) have been attained. 

The undersigned Chairman of the Committee hereby certifies, on behalf of the Compensation Committee, that the performance goals and other
material terms applicable to the awards for the Fiscal Year as set forth herein (including the Schedules attached hereto) have been determined and approved at the Compensation Committee meeting of even date herewith. 

 

			
	 By:
	 	/s/ William H. Rackoff
		 	William H. Rackoff
		 	Chairman, Compensation Committee
		
	Date:	 	03/06/12

  
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