Document:

exv10w1

 

Exhibit 10.1

2006 Long Term Incentive Plan (LTIP)

1.1 Grant of Restricted Stock. Under the terms and provisions of the Newell Rubbermaid
Inc. 2003 Stock Plan, as amended and restated effective February 8, 2006 (the “Stock Plan”), the
terms of which are hereby incorporated by reference, the Committee, at any time and from time to
time, may grant Shares of Restricted Stock to Key Employees in such amounts, as the Committee shall
determine. This Long Term Incentive Plan establishes a methodology for determining awards of
Restricted Stock under the Stock Plan. Awards made pursuant to this LTIP shall constitute
Performance Shares for purposes of Section 9 of the Stock Plan and are intended to qualify as
performance-based compensation under Section 162(m) of the Internal Revenue Code. Based on
attainment of the performance goals established pursuant to this LTIP, the Committee will grant
shares of Restricted Stock to eligible Key Employees. A maximum of 250,000 shares of Restricted
Stock may be granted to any eligible Key Employee in any one calendar year pursuant to this LTIP,
in each case subject to adjustment as provided in the Stock Plan.

1.2 Guidelines. Each grant of Restricted Stock shall be made based on the applicable
target of an employee’s base salary set forth below:

	 	•	 	Salary Level 6 — 25%
	 
	 	•	 	Salary Level 7 — 50%
	 
	 	•	 	Salary Level 8 and above — 100%
	 
	 	•	 	Chief Executive Officer — 200%

The following criteria will be used to determine the actual level:

	 	•	 	Total Shareholder Return (75%)
	 
	 	•	 	Free Cash Flow (25%)

The total point value will be used as follows:

	•	 	Total Shareholder Return will be calculated based on the following formula:

(Change in Stock Price) + (Dividend)

            (Beginning Stock Price)

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	o
	 	Top 5 of comparator group
	 	=
	 	 	100	%	 	of target
	 

	 	o
	 	6 — 10 of comparator group
	 	=
	 	 	75	%	 	of target
	 

	 	o
	 	11 — 15 of comparator group
	 	=
	 	 	50	%	 	of target
	 

	 	o
	 	16 — 20 of comparator group
	 	=
	 	 	25	%	 	of target
	 

	 	o
	 	Bottom 5 of comparator group
	 	 =
	 	 	0	%	 	 

	 	 	NOTE: Target is 75% of the total award payout for Shareholder return

	•	 	The Free Cash Flow award will be calculated based on the following schedule:

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	o
	 	> 110% of FCF target
	 	=
	 	 	100	%	 	of target
	 

	 	o
	 	100 — 110% of FCF target
	 	=
	 	 	75	%	 	of target
	 

	 	o
	 	90 — 100% of FCF target
	 	=
	 	 	50	%	 	of target
	 

	 	o
	 	80 — 90% of FCF target
	 	=
	 	 	25	%	 	of target
	 

	 	o
	 	<80% of FCF target	 	 =	 	 	0	%	 	 

	 	 	NOTE: Target is 25% of the total award payout for Free Cash Flow

 

 

Exhibit 10.1

The list of eligible employees is determined by the Committee each year. For 2006, employees of
Newell Rubbermaid holding the position of Director (Salary Level 6) or above that are designated by
the Committee shall be eligible to participate in the LTIP.

1.3 Restricted Stock Agreement. Each Restricted Stock grant made pursuant to this LTIP
shall be evidenced by a Stock Award Agreement in accordance with Section 7 of the Stock Plan that
shall specify the Period of Restriction at a 3 year cliff, the number of Shares of Restricted Stock
granted, and such other provisions as the Committee shall determine.

1.4 Transferability. Except as provided in this Article, the Shares of Restricted Stock
granted herein may not be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated until the end of the applicable Period of Restriction established by the Committee in
its sole discretion and set forth in the Stock Award Agreement. All rights with respect to the
Restricted Stock granted to an eligible employee under the LTIP shall be available during his or
her lifetime only to such eligible employee.

1.5 Other Restrictions. The Committee shall impose such other conditions and/or
restrictions on any Shares of Restricted Stock granted pursuant to the LTIP as it may deem
advisable including, without limitation, continued employment with Newell Rubbermaid, restrictions
based upon the achievement of specific company-wide performance goals, time-based restrictions on
vesting following the attainment of performance goals, and/or restrictions under applicable federal
or state securities laws. The Committee will establish performance targets annually in accordance
with the standards set forth in this LTIP.

     Except as otherwise provided in this Article or pursuant to the Stock Plan, Shares of
Restricted Stock covered by each award of Restricted Stock made pursuant to the LTIP shall become
freely transferable by the eligible employee after the last day of the applicable Period of
Restriction.

1.6 Dividends and Other Distributions. During the Period of Restriction, eligible
employees holding Shares of Restricted Stock granted hereunder will be credited with regular cash
dividends paid with respect to the underlying Shares while they are so held; provided that the
Committee may apply any restrictions to the dividends that the Committee deems appropriate. Without
limiting the generality of the preceding sentence, the Committee may apply any restrictions it
deems appropriate to the payment of dividends declared with respect to Restricted Stock, such that
the dividends and/or the Restricted Stock continue to qualify as performance-based compensation.

1.7 Termination of Employment/Directorship. Each Stock Award Agreement shall set forth
the extent to which the eligible employee shall have the right to receive unvested Restricted Stock
following termination of the eligible employee’s employment or directorship with Newell Rubbermaid.
Such provisions shall be determined in the sole discretion of the Committee, shall be included in
the Stock Award Agreement entered into with each eligible employee, need not be uniform among all
Shares of Restricted Stock issued pursuant to the LTIP, and may reflect distinctions based on the
reasons for termination.

1.8 Performance Goals. Following the completion of the performance period, the Committee
shall determine, in its sole judgment, the extent to which such performance goals have been
achieved and shall authorize the issuance of Restricted Stock to participants in accordance with
the terms of this LTIP. No Restricted Stock will be awarded pursuant to this LTIP except on the

 

 

Exhibit 10.1

basis of the attainment of such performance criteria and in the amount specified herein; provided
that the Committee retains the discretion to reduce any amount to be awarded hereunder or to
terminate an individual’s participation in this LTIP. No individual who is not employed by the
Company or any of its affiliates on the date of such determination by the Committee shall be
eligible to receive an award of Restricted Stock hereunder.

1.9 Capitalized Terms. Capitalized terms used but not defined herein shall have the
meanings assigned to such terms pursuant to the Stock Plan.exv10w2

 

Exhibit 10.2

NEWELL RUBBERMAID INC. MANAGEMENT CASH BONUS PLAN

     The following is a description of the Newell Rubbermaid Inc. Management Cash Bonus Plan
(“Bonus Plan”), as amended though February 8, 2006. The Bonus Plan (attached hereto) provides for
the payment of annual cash bonuses to employees who are considered to be management level and are
selected by the Committee.

     The Bonus Plan is administered by the Organizational Development & Compensation Committee, or
if the Committee is not comprised of “outside directors” as defined in Section 162(m), then by a
subset of the Committee comprised of at least two “outside directors” (the “Committee”). The
Committee has full authority to select the employees eligible for bonus awards under the Bonus
Plan, determine when the employee’s participation in the Bonus Plan will begin, and determine the
performance goals pursuant to which bonus amounts will be determined. The Committee may delegate
to the officers of the Company the authority to determine performance goals and participation at
the Divisional Level, subject to the guidelines and limitations determined by the Committee.

     The Bonus Plan provides that for a calendar year the Committee will establish corporate, group
and division performance goals and a bonus payment schedule detailing the amount that may be paid
to each participant based upon the level of attainment of the applicable performance goals. Bonus
payments will be made only upon the Committee’s determination that the performance goals for the
calendar year were achieved. The performance goals may be based on one or more of the following
business criteria: earnings per share; cash flow; operating income; sales growth; common stock
price; return on equity; return on assets; return on investment; net income; and expense
management. Performance goals may be absolute in their terms or measured against or in
relationship to the performance of other companies or indices selected by the Committee. The
performance goals may be particular to one or more subsidiaries, groups or divisions or may be
based on the performance of the Company and its subsidiaries as a whole.

     Bonus payments for the 2006 calendar year will be based on a combination of the following
business criteria. For Corporate participants, 100% of the bonus payment will be based on the
Company’s earnings per share, cash flow, sales growth and total shareholder return. For Group
participants, 50% of the bonus payment will be based on Corporate performance criteria, and 50% of
the bonus payment will be based on Group operating income, cash flow and sales growth. For
Divisional participants, 25% of the bonus payment will be based on Corporate performance criteria,
and 75% of the bonus payment will be based on Divisional operating income, cash flow and sales
growth and, for certain divisions, Group performance criteria. Bonus payments for calendar years
subsequent to 2006 will be based on the same performance criteria described above, unless the
Committee establishes different criteria.

     The bonus amount payable is a percentage of salary based upon an employee’s participation
category and the level of attainment of the applicable performance goals, as reflected in the table
below. Performance below the target levels will result in lower or no bonus payments. No award
will be paid for any calendar year or portion thereof to a participant whose

 

 

employment with the Company terminates during the year for a reason other than retirement,
disability, death or other reason approved by the Committee. In all cases, the Committee must
approve final bonus awards and can reduce a bonus payment in its discretion. The Company retains
the right to terminate an employee’s participation in the Bonus Plan at any time, in which case no
bonus may be paid.

	 	 	 	 	 	 	 	 	 
	 	 	Bonus as a Percentage of	 	 
	 	 	Salary if Targets Achieved at	 	Maximum Bonus as a
	Participation Category	 	100% Level	 	Percentage of Salary
	

	 	<c>
	 	<c>

	A/A*

	 	 	105.0	%	 	 	210.0	%
	A/B**

	 	 	65.0	%	 	 	130.0	%
	A/C**

	 	 	55.0	%	 	 	110.0	%
	A**

	 	 	45.0	%	 	 	90.0	%
	B/C**

	 	 	35.0	%	 	 	70.0	%
	B**

	 	 	33.5	%	 	 	67.0	%
	C**

	 	 	16.75	%	 	 	33.5	%
	D**

	 	 	8.375	%	 	 	16.75	%

 

			
	 	 	* Applies to the Company’s Chief
Executive Officer.
	 
	 	 	** Applies to participants as determined by the
Committee or management, as applicable. A/B includes all named executive
officers other than the Chief Executive Officer. Except for individuals
specifically designated by the Committee, bonus payouts for individuals outside
of the United States will not be based on the payout percentages set forth
herein but will instead be based on the payout percentages set forth in the
Company’s Management Cash Bonus Plan, effective January 31, 2002, which
plan was filed as Exhibit 10.3 to the Company’s Annual Report on Form
10-K for the year ended December 31, 2002.

 

 

Newell Rubbermaid Inc. Management Cash Bonus Plan

	1.	 	Name
	 
	 	 	Newell Rubbermaid Inc. Management Cash Bonus Plan
	 
	2.	 	Effective Date of Revisions
	 
	 	 	February 8, 2006
	 
	3.	 	Purpose

     To provide an incentive for key employees to improve Company performance by making them
participants in the financial success of the Company.

	4.	 	Definitions

	 	(a)	 	The term “Company” means Newell Rubbermaid Inc. and its subsidiaries.
	 
	 	(b)	 	The term “Board” means the Board of Directors of Newell Rubbermaid Inc.
	 
	 	(c)	 	The term “Plan” means the arrangement described by these specifications to be
known as the Newell Rubbermaid Management Inc. Cash Bonus Plan.
	 
	 	(d)	 	The term “Plan Year” means a calendar year of the Company.
	 
	 	(e)	 	The term “Committee” means the Organizational Development & Compensation
Committee of the Board.
	 
	 	(f)	 	The term “Participant” means any active “regular” key employee of the Company
or any of its subsidiaries who has been selected by the Committee as eligible to
receive incentive compensation under the Plan.
	 
	 	(g)	 	The term “Salary” means a Participant’s base annual salary earned during a Plan
Year while a participant, exclusive of commissions and bonuses.

	5.	 	Eligibility and Participation

     Employees selected by the Committee as eligible to receive incentive compensation under the
Plan shall be Participants.

     When the Committee selects an employee to become a Participant under the Plan, it shall
designate the date as of which his/her participation shall begin.

 

 

	6.	 	Annual Incentive Awards

     At the end of each Plan Year, the incentive compensation to be awarded to each Participant
shall be determined by multiplying his/her Salary for the Plan Year by the appropriate Corporate,
Group or Divisional financial results percentage based on achievement of pre-determined goals.

	7.	 	Bonus Plan Awards

     When an employee is selected to become a Participant under the Plan, he/she will be eligible
to receive a target bonus payout based on the following percentage of Salary: A/A (105.0%), A/B
(65.0%); A/C (55.0%); A (45.0%); B/C (35.0%); B (33.5%); C (16.75%); and D (8.375%). The maximum
bonus payout percentages for incentive awards under the Plan are as follows: A/A (210.0%), A/B
(130.0%); A/C (110.0%); A (90.0%); B/C (70.0%); B (67.0%); C (33.5%); and D (16.75%). In no event
shall any employee receive an incentive award under the Plan that exceeds, for any calendar year,
$2,900,000.

	8.	 	Plan Limitations

     Notwithstanding anything herein to the contrary, for Plan purposes, no award will be made for
a Plan Year to a Participant whose employment terminated during such Plan Year unless the
termination was due to retirement, disability, death or any other cause approved by the Committee.

	9.	 	Payment of Incentive Awards

     A Participant’s award for a Plan Year under the Plan shall be paid in cash to the Participant,
or his/her beneficiary or beneficiaries in the event of his/her death, prior to March 15 of the
following Plan Year, unless he/she elects to have a part or all of the award deferred as provided
in Section 10 below.

	10.	 	Deferral of Awards

     In lieu of receiving an award as provided in Section 9 above, a Participant may elect to defer
all or part of his/her incentive award in accordance with the 2002 Newell Rubbermaid Deferred
Compensation Plan.

	11.	 	Management Rights

     Corporate Management or, in the case of the Chief Executive Officer of the Corporation or any
Participant that reports directly to the Chief Executive Officer, the Board reserves the right to
cancel eligibility of a bonus participant at any time and refuse bonus payment for any reason.

 

 

	12.	 	Amendments 

     The Board may either modify or eliminate the Plan if in its judgment such modification or
elimination does not materially or adversely affect the best interests of the Company or of the
stockholders; provided, that such modification or elimination shall not affect the obligation of
the Company to pay any incentive compensation after it has been earned.

	13.	 	Employment Rights

     Nothing contained in the Plan shall be construed as conferring a right upon any employee to be
continued in the employment of the Company.

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