Document:

a50258908ex101.htm

Exhibit 10.1

NIC INC.

EXECUTIVE INCENTIVE PLAN

OBJECTIVE

 

The NIC Inc. Executive Incentive Plan (the "Incentive Plan" or "Plan") is designed to reward value creation by providing competitive incentives for the achievement of performance goals, either on an annual basis or other predetermined period of time.  By providing market-competitive target awards, the Plan supports the attraction and retention of senior executive talent critical to achieving the strategic business objectives of NIC Inc. (the "Company").  The Incentive Plan is also intended to secure the full deductibility of bonus compensation payable to the Company’s Chief Executive Officer, and any other executive officer (collectively the "Covered Employees"), whose compensation is potentially subject to the tax deduction limitations of Section 162(m) of the Internal Revenue Code of 1986, as amended (the "Code").  All compensation payable hereunder to such Covered Employees is intended to qualify as "performance-based compensation" as described in Code Section 162(m)(4)(C) and may be payable either in cash or, if permitted under a Company stockholder-approved equity plan, shares of the Company's common stock ("Shares").

 

ELIGIBILITY AND PARTICIPATION

 

Only those executive officers and key employees of the Company who are selected by the Compensation Committee or other committee (the "Committee") of the Company’s Board of Directors (the "Board") shall be eligible to receive Awards under and participate in the Incentive Plan.  Before or at the time performance objectives are established for an "Incentive Period," as defined below, the Committee will designate in writing which executive officers and key employees are among those who may be eligible to participate in the Incentive Plan, and shall in fact be participants for such Incentive Period.

 

APPLICABILITY TO COMPANY PERFORMANCE AWARDS AND COMPANY PLANS

 

The Plan shall serve as a Code Section 162(m) "platform" or "umbrella" plan such that, to the maximum extent permitted by law, this Plan applies to all forms and types of compensatory arrangements, awards, programs or plans sponsored or maintained by the Company and designated by the Committee as being subject to this Plan (the "Awards").  To the extent applicable and not inconsistent with the terms of any other Company-sponsored compensation plan, with the Board's and Company stockholders' approval of this Incentive Plan, the terms and conditions of this Plan shall supplement such other Company-sponsored compensation arrangements and Awards.  Without limiting the foregoing, performance-based restricted stock or any other performance-based award granted under another of the Company's stockholder-approved equity compensation plans, including the Company's 2006 Amended and Restated Stock Option and Incentive Plan, if subject to the performance criteria and granted pursuant to the procedures, parameters and conditions set forth in this Plan to the extent required by Code Section 162(m), shall be eligible to qualify as performance-based compensation and be exempt from Code Section 162(m)'s deduction limitations.

 

PLAN YEAR, INCENTIVE PERIODS AND INCENTIVE OBJECTIVES

 

The applicable performance period (the "Incentive Period") for the Incentive Plan shall generally be the Company's fiscal year beginning on January 1 and ending on December 31;  provided, however, that the Committee shall have the authority to designate different Incentive Periods and any such alternative Incentive Periods may exceed or be less than a 365-day period.

 

  

1

  

 

Before the earlier of the 90th day of each Incentive Period or the day on which 25 percent of the Incentive Period has elapsed, the Committee shall establish in writing, with respect to such Incentive Period, one or more performance goals, a specific target objective or objectives with respect to such performance goals, and an objective formula or method for computing the amount of performance compensation payable to each participant under the Incentive Plan if the performance goals are attained.  Notwithstanding the immediately preceding sentence, for any Incentive Period, such goals, objectives and compensation formulae or methods must be established such that the outcome of the goal or objective is substantially uncertain at the time the Committee actually establishes the goal or objective.

 

Any type of Award that is eligible to be granted under the Plan may be granted to officers and employees as awards intended to satisfy the requirements of "performance-based compensation" within the meaning of Code Section 162(m) ("Performance Awards").  The specific performance goals for Performance Awards shall be established, on an absolute or relative basis, based on one or more of the following business criteria ("Business Criteria") for the Company on a segregated or consolidated basis, or for one or more of the Company's subsidiaries, segments, divisions, or business units, as selected by the Committee:

 

	
  

	
(i)

	
Earnings measures (either in the aggregate or on a per-Share basis), including or excluding one or more of interest, taxes, depreciation, amortization or other financial accounting measurements;

 

	
  

	
(ii)

	
Operating profit (either in the aggregate or on a per-Share basis);

 

	
  

	
(iii)

	
Operating income (either in the aggregate or on a per-Share basis);

 

	
  

	
(iv)

	
Net earnings on either a LIFO or FIFO basis (either in the aggregate or on a per-Share basis);

 

	
  

	
(v)

	
Net income or loss (either in the aggregate or on a per-Share basis);

 

	
  

	
(vi)

	
Cash flow provided by operations, either in the aggregate or on a per-Share basis;

 

	
  

	
(vii)

	

Cash flow returns, including cash flow returns on invested capital (cash flow from operating activities minus capital expenditures, the difference of which is divided by the difference between total assets and non-interest bearing current liabilities);

 

	
  

	
(viii)

	
Ratio of debt to debt plus equity;

 

	
  

	
(ix)

	
Net borrowing;

 

	
  

	
(x)

	
Credit quality or debt ratings;

 

	
  

	
(xi)

	
Inventory levels, inventory turn or shrinkage;

 

	
  

	
(xii)

	
Revenues;

 

	
  

	
(xiii)

	
Free cash flow (either in the aggregate or on a per-Share basis);

 

  

2

  

 

	
  

	
(xiv)

	
Reductions in expense levels, determined either on a Company-wide basis or with respect to any one or more business units;

 

	
  

	
(xv)

	
Operating and maintenance cost management and employee productivity;

 

	
  

	
(xvi)

	
Gross margin;

 

	
  

	
(xvii)

	
Return measures (including return on assets, investment, equity, or sales);

 

	
  

	
(xviii)

	
Productivity increases;

 

	
  

	
(xix)

	
Share price (including attainment of a specified per-Share price during the Incentive Period; growth measures and total stockholder return or attainment by the Shares of a specified price for a specified period of time);

 

	
  

	
(xx)

	
Growth or rate of growth of any of the above Business Criteria set forth in this Section;

 

	
  

	
(xxi)

	
Achievement of business criteria, consisting of one or more objectives based on meeting specified revenue, market share, customer sales, new and existing business development, market penetration, geographic business expansion goals, objectively identified project milestones, production volume levels, cost targets, customer satisfaction, and goals relating to acquisitions or divestitures;

 

	
  

	
(xxii)

	
Preservation of Company or shareholder value during adverse business conditions; and/or

 

	
  

	
(xxiii)

	
Accomplishment of mergers, acquisitions, dispositions, public offerings, or similar extraordinary business transactions;

 

provided that applicable Business Criteria may be applied on a pre- or post-tax basis; and provided further that the Committee may, when the applicable performance goals are established, provide that the formula for such goals may include or exclude items to measure specific objectives, such as losses from discontinued operations, extraordinary gains or losses, the cumulative effect of accounting changes, acquisitions or divestitures, foreign exchange impacts, and any unusual, nonrecurring gain or loss.  As established by the Committee, the Business Criteria may include, without limitation, GAAP and non-GAAP financial measures. In addition to the foregoing Business Criteria, the Business Criteria shall also include any performance goals which are set forth in any other Company bonus, incentive or other compensation-related plan, if any, which has been approved by the Company's stockholders, which are incorporated herein by reference. Such performance goals shall be set by the Committee within the time period prescribed by, and shall otherwise comply with the requirements of, Code Section 162(m).

 

Target levels for Awards are determined by the Committee.  To the extent consistent with the goal of providing for deductibility under Code Section 162(m), performance goals may be based upon a participant's attainment of personal objectives with respect to any of the above-listed Business Criteria.  Measurements of the Company’s or a participant's performance against the performance goals established by the Committee shall be objectively determinable.

 

DETERMINATION OF AMOUNTS OF AWARDS EARNED

 

As soon as practicable after the end of each Incentive Period, the Committee shall certify, in writing (unless Code Section 162(m) does not require certification in writing), to what extent the Company and the participant(s) have achieved the performance goal or goals for such Incentive Period, including the specific target objective or objectives and the satisfaction of any other material terms of the Award, and the Committee shall calculate the amount of each participant's Award earned for such Incentive Period based upon the performance goals, objectives and computation formulae or methods for such Incentive Period.  The Committee shall have no discretion to increase the amount of any participant's Award, but may reduce the amount of or totally eliminate such Award, if it determines, in its absolute and sole discretion, that such a reduction or elimination is appropriate in order to reflect the participant's performance or unanticipated factors.

 

  

3

  

 

Except as provided below with respect to cash payments relating to the settlement of equity-based Awards, with respect to any compensation paid in cash, no participant's payment under this Incentive Plan during any single calendar year shall exceed the lesser of 200% of the participant's base annual salary as in effect on the last day of the most recently ended Company fiscal year, or $2.5 million.

 

Subject to adjustment as provided below, with respect to any equity-based Award that could be payable in Shares (e.g., stock options, stock-settled stock appreciation rights, performance-based restricted stock or performance-based restricted stock units) or any equity-based Award that could be payable in cash but in an amount determined based solely on the then fair market value of the Shares underlying such Award (e.g., performance-based restricted stock units or cash-settled stock appreciation rights) (collectively, "Stock Awards"), in no event may any one participant be granted Stock Awards subject to this Plan in any single calendar year covering more than 200,000 Shares; provided, however, that to the extent a Company stockholder-approved equity plan contains a lower limitation, the lower limitation in that plan shall control.  If any change is made in the Shares without the receipt of consideration by the Company (e.g., through stock dividend, stock split etc.), the above maximum Share limitation shall be appropriately and automatically adjusted to reflect such change.

 

PAYMENT OF AWARDS

 

Subject to the payment provisions of this Section 6, approved Awards shall be payable by the Company to each participant, or to such participant's estate in the event of his death, as soon as practicable after the end of each Incentive Period, and after the Committee has certified in writing that the relevant performance goals were achieved.  At the sole discretion of the Committee, Awards may be payable in cash or in an equivalent number of shares of the Company’s common stock issued, pursuant to and under one or more of the Company’s stockholder-approved stock incentive plans.

 

An Award that would otherwise be payable to a participant who is not employed by the Company or one of its subsidiaries on the last day of an Incentive Period shall be paid in accordance with rules and regulations adopted by the Committee for the administration of the Incentive Plan or any other agreement between the Company and the participant.

 

Unless the Company has adopted a deferred compensation plan and the participant has made a valid deferral election under such plan, all payments under this Plan are intended to be exempt from Code Section 409A pursuant to the "short-term deferral" exception provided in Treasury Regulation Sections 1.409A 1(b)(4) and the Plan will be interpreted to achieve this result.  Accordingly, all payments under this Plan will be paid no later than March 15 of the calendar year following the year in which a participant's right to a payment under this Plan is no longer subject to a substantial risk of forfeiture.  In no event is the Company responsible for any tax or penalty owed by participant with respect to the payments under this Plan.

 

  

4

  

 

OTHER TERMS AND CONDITIONS

 

Unless otherwise permitted under Code Section 162(m), no Awards shall be paid under the Incentive Plan unless and until the material terms (within the meaning of Section 162(m)(4)(C) of the Code) of the Incentive Plan, including the Business Criteria described above in Section 4 of the Incentive Plan, are disclosed to the Company’s stockholders and are approved by the stockholders by a majority of votes cast in person or by proxy (including abstentions, to the extent that abstentions are counted as voting under applicable state law).  As determined appropriate by the Company and as necessary for certain payments of compensation to remain exempt from Code Section 162(m)'s deduction limitation, the Incentive Plan will be submitted to the stockholders for reapproval if the Business Criteria stated above in Section 4 are materially changed and, in any event, will be submitted to be reapproved by stockholders no later than the first stockholder meeting that occurs in the fifth year following the year in which stockholders previously approved the Business Criteria.

 

No person shall have any legal claim to be granted an Award under the Incentive Plan and the Committee shall have no obligation to treat participants uniformly.  Except as may be otherwise required by law, Awards under the Incentive Plan shall not be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, charge, garnishment, execution, or levy of any kind, either voluntary or involuntary.  Cash Awards under the Incentive Plan shall be payable from the general assets of the Company, and no participant shall have any claim with respect to any specific assets of the Company.

 

Neither the Incentive Plan nor any action taken under the Incentive Plan shall be construed as giving any employee the right to be retained in the employ of the Company or any subsidiary or to maintain any participant's compensation at any level.

 

The Company or any of its subsidiaries may deduct from any award any applicable withholding taxes, or any amounts owed by the executive of the Company or any of its subsidiaries.

 

By participating in the Incentive Plan, each participant is deemed to have acknowledged that any amount paid pursuant to the Incentive Plan may be subject to certain provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank”) that will require the Company to recover certain amounts of incentive compensation paid to certain executive officers if the Company is required to prepare an accounting restatement due to the material noncompliance of the Company with any financial reporting requirements under any applicable securities laws.  By participating in the Plan, each participant agrees and consents to any forfeiture or required recovery or reimbursement obligations of the Company with respect to any compensation paid that is forfeitable or recoverable by the Company pursuant to Dodd-Frank and in accordance with any Company policies and procedures adopted by the Committee in order to comply with Dodd-Frank, as the same may be amended from time to time.

 

ADMINISTRATION

 

All members of the Committee shall be persons who qualify as "outside directors" as defined under Code Section 162(m).  Until changed by the Board, the Compensation Committee of the Board shall constitute the Committee hereunder.

 

The Committee shall have full power and authority to administer and interpret the provisions of the Incentive Plan and to adopt such rules, regulations, agreements, guidelines and instruments for the administration of the Incentive Plan and for the conduct of its business as the Committee deems necessary or advisable.

 

  

5

  

 

Except with respect to matters which, under Section 162(m)(4)(C) of the Code, are required to be determined in the sole and absolute discretion of the Committee, the Committee shall have full power to delegate to any officer or employee of the Company the authority to administer and interpret the procedural aspects of the Incentive Plan, subject to the Incentive Plan's terms, including adopting and enforcing rules to decide procedural and administrative issues.

 

The Committee may rely on opinions, reports or statements of officers or employees of the Company or any subsidiary thereof, company counsel (inside or retained counsel), public accountants and other professional or expert persons.

 

The Board reserves the right to amend or terminate the Incentive Plan in whole or in part at any time.  Unless otherwise prohibited by applicable law, any amendment required to conform the Incentive Plan to the requirements of Code Section 162(m) may be made by the Committee.  No amendment may be made to the class of individuals who are eligible to participate in the Incentive Plan, the performance criteria specified in Section 4, or the maximum Award amount payable to any participant without stockholder approval, unless stockholder approval is not required in order for compensation paid to Covered Employees to constitute qualified performance-based compensation under Code Section 162(m).

 

No member of the Committee shall be liable for any action taken or omitted to be taken, or for any determination made by him or her in good faith with respect to the Incentive Plan and the Company shall indemnify and hold harmless each member of the Committee in accordance with the Company's Certificate of Incorporation and By-Laws as the same may be amended from time to time, and any indemnification agreement between the Company and such member of the Committee.

 

The rules, regulations and rights relating to the Incentive Plan shall be determined solely in accordance with the laws of the State of Delaware.

 

6a50251189ex10-2.htm

Exhibit 10.2

 

ROGERS CORPORATION

2009 LONG-TERM EQUITY COMPENSATION PLAN

 

PERFORMANCE-BASED RESTRICTED STOCK AWARD AGREEMENT

 

Rogers Corporation (the “Company”) hereby grants to «First_Name» «Last_Name» (the “Grantee”) Restricted Stock Units under Section 8 of the Rogers Corporation 2009 Long-Term Equity Compensation Plan, as amended (the “Plan”).  This Performance-Based Restricted Stock Award Agreement (this “Agreement”) entitles the Grantee to payment in the form of Shares following the attainment of the Performance Objectives and employment requirements set forth below.  The target number of shares of (capital) common stock of the Company (the “Capital Stock”) subject to this Agreement is   «Company_Name» Shares (the “Target Shares”), subject to adjustment under Section 2.3 of the Plan.  This Award is granted as of February 9, 2012 (the “Grant Date”).

 

1.           Acceptance of Award.  The Grantee shall have no rights with respect to this Agreement unless he or she shall have accepted this Agreement prior to the close of business on August 1, 2012 by signing and delivering to the Company a copy of this Agreement.

 

2.           Issuance of Shares.

 

(a)           Subject to Paragraph 6 below, the actual number of shares of Capital Stock to be issued to the Grantee shall be determined based on the Weighted Average Performance Achievement Percentage (as defined in Paragraph 2(b) below) during the Company’s 2012, 2013 and 2014 fiscal years (the “Performance Period”) using the following table:

 

	  	 	
Weighted Average Performance 

Achievement Percentage

	 	
Percentage of

Target Shares

	 	 	 	 	 
	
Below Threshold

	 	
Less than 0%

	 	
None

	
Threshold

	 	
0%

	 	
0% of Target Shares

	
Target

	 	
100%

	 	
100% of Target Shares

	
Maximum

	 	
200% or more

	 	
200% of Target Shares

 

For avoidance of doubt, no Shares shall be awarded for a Weighted Average Performance Achievement Percentage of 0% or less, and no more than two times the number of Target Shares shall be deliverable if the Weighted Average Performance Achievement Percentage exceeds 200%.

 

  

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(b)           The “Weighted Average Performance Achievement Percentage” for purposes of this table shall be the average percentage for the Performance Objectives determined pursuant to Schedule A to this Agreement.  Straight-line interpolation shall be used to determine the “Percentage of Target Shares” under the table set forth in Paragraph 2(a) above if the Weighted Average Performance Achievement Percentage is between Threshold and Target and between Target and Maximum.  For example, a 50% Weighted Average Performance Achievement Percentage will result in delivery of 50% of the Target Shares.  Any partial Share shall be rounded up to the nearest whole Share.

 

3.           Restrictions and Conditions.  If the Grantee’s employment with the Company and its Affiliates is terminated for any reason, other than death, Disability or Retirement, as such terms are set forth and defined in Schedule B hereto, prior to the end of the Performance Period, the Grantee shall forfeit any and all rights hereunder and no shares of Capital Stock shall be issued hereunder regardless of actual performance during the Performance Period.  If the Grantee’s employment with the Company and its Affiliates is terminated due to the Grantee’s death, Disability or Retirement prior to the end of the Performance Period, the number of shares of Capital Stock determined pursuant to Paragraph 2 to be issued to the Grantee shall be pro rated based on the number of days that the Grantee was actively employed during the Performance Period, rounded up to the nearest whole Share.  For example, if the Grantee was actively employed by the Company, one of its Affiliates or both, for 600 days during the Performance Period and then terminated employment due to Retirement, then the Grantee shall receive 54.79% [600 days / (365 x 3)] of the number of shares of Capital Stock determined under Paragraph 2 based on the performance achieved at the end of the Performance Period, rounded up to the nearest whole Share.

 

4.           Scheduled Payment Date.  Subject to Paragraph 6 below, the Company shall deliver or cause to be delivered to the Grantee the number of earned and vested Shares, if any, as certified by the Compensation and Organization Committee of the Board of Directors of the Company (the “Committee”) under Paragraph 2 and Paragraph 3 above, on or before the Scheduled Payment Date in compliance with applicable law.  The Company shall determine in its sole discretion the manner of delivering Shares under this Paragraph 4.  For purposes of this Agreement, the “Scheduled Payment Date” means the March 15th within the calendar year immediately following the expiration of the Performance Period.

 

5.           Dividends.  The Grantee shall also be paid cash in an amount equal to (a) the dollar value of cash dividends paid by the Company per share of Capital Stock during the period starting on the Grant Date and ending on the date Shares are actually delivered to the Grantee under the terms of this Agreement, multiplied by (b) the number of Shares earned and vested under this Agreement.  Any such dividends shall be paid to the Grantee on the date Shares are actually delivered to the Grantee under the terms of this Agreement.

 

  

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6.           Change in Control.  The Restricted Stock Units under this Agreement shall be considered to be earned and vested upon a Change in Control that occurs before the end of the Performance Period to the extent determined by the Committee in good faith under Section 11.9(b) of the Plan; provided that the Grantee is then employed by the Company or one of its Affiliates.  In the event that Restricted Stock Units become earned and vested under this Paragraph 6, payment shall be made consistent with the terms of the Plan as soon as practicable (but in no event more than five business days) following a Change in Control.

 

7.           Tax Withholding.  The Grantee hereby agrees to make appropriate arrangements with the Company for such income and employment tax withholding as may be required of the Company under applicable United States federal, state, local or foreign law on account of the Grantee’s rights under this Agreement.  The Grantee may satisfy any withholding obligation, in whole or in part, by electing (i) to make a payment to the Company in cash, by check, electronic funds transfer or by other instrument acceptable to the Company, (ii) to deliver to the Company a number of already-owned shares of Capital Stock having a value not greater than the amount required to be withheld (such number may be rounded up to the next whole share) as may be permitted pursuant to written policies or rules adopted by the Committee in effect at the time of the delivery of the earned and vested Shares, or (iii) by any combination of (i) and (ii).  In addition, the Committee may also permit, in its sole discretion and in accordance with such policies and rules as it deems appropriate, the Grantee to have the Company withhold a number of shares which would otherwise be issued pursuant to this Agreement having a value not greater than the amount required to be withheld (such number may be rounded up to the next whole share).  The value of Shares to be withheld or delivered (as may be permitted by the Committee) shall be based on the Fair Market Value of a share of Capital Stock as of the date the amount of tax to be withheld is to be determined.  For avoidance of doubt, the Committee may change its policies and rules for tax withholding in its sole discretion from time to time for any reason.

 

8.           The Plan.  This Agreement is subject in all respects to the terms, conditions, limitations and definitions contained in the Plan.  In the event of any discrepancy or inconsistency between this Agreement and the Plan, the terms and conditions of the Plan shall control. Capitalized terms in this Agreement shall have the meaning specified in the Plan, unless a different meaning is specified herein.

 

9.           No Obligation to Continue Employment.  Neither the Company nor any Affiliate is obligated by or as a result of the Plan or this Agreement to continue the Grantee in employment.

 

10.           Notices.  Notices hereunder shall be mailed or delivered to the Company at its principal place of business and shall be mailed or delivered to the Grantee at the address on file with the Company or, in either case, at such other address as one party may subsequently furnish to the other party in writing.

 

  

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11.           Purchase Only for Investment.  To insure the Company’s compliance with the Securities Act of 1933, as amended, the Grantee agrees for himself or herself, the Grantee’s legal representatives and estate, or other persons who acquire the rights under this Agreement upon his or her death, that Shares will be acquired hereunder for investment purposes only and not with a view to their distribution, as that term is used in the Securities Act of 1933, as amended, unless in the opinion of counsel to the Company such distribution is in compliance with or exempt from the registration and prospectus requirements of that Act.

 

12.           Governing Law.  This Agreement shall be governed by the laws of the Commonwealth of Massachusetts, United States of America.

 

13.           Beneficiary Designation.  The Grantee hereby designates the following person(s) as the Grantee’s Beneficiary(ies) to whom shall be transferred any rights under this Agreement which survive the Grantee’s death.  If the Grantee names more than one primary beneficiary and one or more of such primary beneficiaries die, the deceased primary beneficiary’s interest will be apportioned among any surviving primary beneficiaries before any contingent beneficiary receives any amount, unless the Grantee indicates otherwise in a signed and dated additional page. The same rule shall apply within the category of contingent beneficiaries.  Unless the Grantee has specified otherwise herein, any rights which survive the Grantee’s death will be divided equally among the Grantee’s primary beneficiaries or contingent beneficiaries, as the case may be.

 

	
PRIMARY BENEFICIARY(IES)

	  	
Name

	
%

	
Address

	
(a)

	
____________________________

	
__

	
_____________________________

	
(b)

	
____________________________

	
__

	
_____________________________

	
(c)

	
____________________________

	
__

	
_____________________________

 

	
CONTINGENT BENEFICIARY(IES)

	  	
Name

	
%

	
Address

	
(a)

	
____________________________

	
__

	
_____________________________

	
(b)

	
____________________________

	
__

	
_____________________________

	
(c)

	
____________________________

	
__

	
_____________________________

  

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In the absence of an effective beneficiary designation in accordance with the terms of the Plan and this Agreement, the Grantee acknowledges that any rights under this Agreement that survive the Grantee’s death shall be rights of his or her estate notwithstanding any other agreements or documents (including the Grantee’s will) to the contrary.

 

14.           Section 409A.  It is intended that this Award be exempt from Section 409A of the Code as a “short-term deferral” (as defined under Treasury Regulation Section 1.409A-1(b)(4)).

 

This Agreement is to be executed in duplicate.

 

	  	
ROGERS CORPORATION

	  	  
	  	  
	  	
By: _____________________________

 

 

 

The undersigned hereby acknowledges receipt of this Agreement and agrees to its terms and conditions:

 

	  	
_________________________________

	  	
Grantee

 

  

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SCHEDULE A

 

Weighted Average Performance Achievement Percentage

 

For purposes of this Agreement, there are three metrics:  “Net Sales Growth”, “EPS Growth” and the “Free Cash Flow Percentage” with each of these three metrics defined in SCHEDULE B and each metric is also called a “Performance Objective”.  Each metric is weighted one-third and the total award is based on the sum of the three weighted metric results (i.e., the “Weighted Average Performance Achievement Percentage”) - up to a 200% maximum.

((Net Sales Growth Result)/3) + ((EPS Growth Result)/3) + (( Free Cash Flow Percentage Result)/3) = Weighted Average Performance Achievement Percentage, up to a 200% maximum

2012 Performance Based Restricted Stock Plan Grant Metrics

 

	
Net Sales Growth

	
Result

	  	
EPS Growth

	
Result

	  	
Free Cash Flow Percentage

	
Result

	  	  	  	  	  	  	  	  	  	  	  	  
	
15%

	  	
300%

	  	
30%

	  	
300%

	  	
5%

	  	
300%

	  	  	  	  	  	  	  	  	  	  	  
	
12%

	  	
200%

	  	
24%

	  	
200%

	  	
4%

	  	
200%

	  	  	  	  	  	  	  	  	  	  	  
	
9%

	  	
100%

	  	
18%

	  	
100%

	  	
3%

	  	
100%

	  	  	  	  	  	  	  	  	  	  	  
	
6%

	  	
50%

	  	
12%

	  	
50%

	  	
2.50%

	  	
50%

	  	  	  	  	  	  	  	  	  	  	  
	
3%

	  	
25%

	  	
6%

	  	
25%

	  	
2.25%

	  	
25%

	  	  	  	  	  	  	  	  	  	  	  
	
0%

	  	
Threshold

	  	
0%

	  	
Threshold

	  	
2%

	  	
Threshold

Straight-line interpolation shall be used to determine the applicable percentage with respect to Rogers Corporation’s achievement of a Performance Objective designated above when performance is between two stated levels in this table.

 

  

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SCHEDULE B

 

Definitions

 

The following terms shall have the meanings set forth below:

 

“Disability” means the Grantee’s inability, due to physical or mental incapacity resulting from injury, sickness or disease, for one hundred and eighty (180) days in any twelve-month period to perform his or her duties.

 

“EPS Growth” means the Company's compound annual growth rate in EPS during the Performance Period, expressed as a percentage, as follows:

 

((Ending Value for EPS /Beginning Value for EPS)^(1/3)) -1 x 100%

 

For purposes of this definition:

 

	
(a)

	
“Ending Value for EPS” means EPS for the Company’s 2014 fiscal year,

 

	
(b)

	
“Beginning Value for EPS” means the Adjusted EPS for the Company’s 2011 fiscal year, which is $2.35, and

 

	
(c)

	
“EPS” means, for a given fiscal year, the Company’s net income per share on a fully diluted basis from continuing operations as reported on the Company’s financial statements for that year in accordance with GAAP.

 

	
  

	
“GAAP” means Generally Accepted Accounting Principles.

 

Notwithstanding the foregoing, in the event that there is a divestiture, acquisition or other extraordinary event during any fiscal year within the Performance Period, the Committee shall calculate EPS Growth in a manner so as to insure comparable business diluted EPS results are used to determine the Company’s compound annual growth in EPS.

 

“Free Cash Flow Percentage” means the Company’s average Free Cash Flow during the Performance Period expressed as a percentage of Company’s Net Sales, which shall be determined as follows:

 

((Year 1 Free Cash Flow/Year 1 Net Sales) + (Year 2 Free Cash Flow/Year 2 Net Sales) + (Year 3 Free Cash Flow/Year 3 Net Sales)) / 3, where “Year 1” is 2012, “Year 2” is 2013, and “Year 3” is 2014.

 

For purposes of determining the Free Cash Flow Percentage, “Free Cash Flow” for a given fiscal year shall be equal to:

 

  

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Net income:

	  
	 	 
	
Plus:

	
non-cash impairment charges, depreciation, amortization and stock compensation expense

	 	 
	
Less:

	
capital expenditures

	 	 
	
Less (if applicable):

	
the increase, if any, in net working capital (i.e., total current assets (excluding cash and cash equivalents) minus current liabilities)

	  	  
	
Plus (if applicable):

	
the decrease, if any, in net working capital

 

as such amounts are reported on the Company’s applicable audited financial statement in accordance with GAAP.

 

Notwithstanding the foregoing, in the event that there is a divestiture, acquisition or other extraordinary event during any fiscal year within the Performance Period, the Committee shall calculate Free Cash Flow and Free Cash Flow Percentage in a manner so as to insure comparable business cash flows are used to determine the Company’s Free Cash Flow Percentage.

 

“Net Sales Growth” means the Company's compound annual growth rate in Net Sales during the Performance Period, expressed as a percentage, as follows:

 

((Ending Value for Net Sales /Beginning Value for Net Sales)^(1/3)) -1 x 100%

 

For purposes of this Schedule B:

 

	
(a)

	
“Ending Value for Net Sales” means the Net Sales for the Company’s 2014 fiscal year,

 

	
(b)

	
“Beginning Value for Net Sales” means the Net Sales for the Company’s 2011 fiscal year, and

 

	
(c)

	
“Net Sales” means, for a given fiscal year, the net sales reported on the Company’s financial statements for that year in accordance with GAAP.

 

Notwithstanding the foregoing, in the event that there is a divestiture, acquisition or other extraordinary event during any fiscal year within the Performance Period, the Committee shall calculate Net Sales and Net Sales Growth in a manner so as to insure comparable business unit sales are used to determine the Company’s compound annual growth in Net Sales.

 

“Retirement” means Termination of Service (as defined in the Plan) after the Grantee attains fifty-five years of age and completes at least five years of vesting service.  For avoidance of doubt, it is not necessary to complete five years of vesting service prior to attaining age fifty-five in order to qualify for Retirement.  For purposes of this Schedule B, “years of vesting service” shall be determined in the same manner as provided for under the Section 401(k) plan maintained by the Company as in effect on the Grant Date.

 

 

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