CSS Industries, Inc. FY 2019 Management Incentive Program Criteria

These FY2019 Management Incentive Program Criteria have been approved by the Human Resources Committee (the “Committee”) of the Board of Directors of CSS Industries, Inc. (“CSS” or the “Company”) in connection with the CSS Industries, Inc. Management Incentive Program (the “Program”). All defined terms used herein and not otherwise defined shall have the respective meanings set forth in the Program. These FY2019 Management Incentive Program Criteria are not intended in any way to alter, modify or supercede the terms of the Program, and reference should be made to such Program for a full description of the terms of the Program.

Notwithstanding any provision in this document or otherwise to the contrary, the Committee, in its sole discretion, reserves the right (a) to determine the eligibility requirements for participation in the Program; (b) to determine whether an employee satisfies the eligibility requirements for participation in the Program; (c) to award an Award, if any, to a Participant under the Program; (d) to deny payment of an Award to a Participant otherwise eligible under the terms of the Program or this document; (e) to make an Award, if any, to a Participant in a greater or lesser amount than provided for in the Program or this document; and/or (f) to make an Award, if any, in a manner or on a schedule other than as provided for in the Program or this document.

For the Company’s fiscal year ending March 31, 2019, each Participant is eligible to receive an Award calculated using a base amount equal to such Participant’s Target Index Amount (as such term is defined below). Unless otherwise determined by the Committee in its sole discretion at the time of approval thereof, each Award is divided into three parts: (a) a part entirely contingent upon the achievement by CSS of at least a minimum threshold level, as determined by the Committee in its sole discretion, of Adjusted EBITDA (as defined herein) (the “Adjusted EBITDA Component”) (b) a part entirely contingent upon the achievement by CSS of at least a minimum threshold level, as determined by the Committee in its sole discretion, of Net Sales (as defined herein) (the “Net Sales Component”), and (c) an individual part determined by the Committee in its sole discretion based upon, among other things, each Participant’s achievement of his or her specific goals and objectives and/or CSS’ achievement of its corporate goals. For purposes of this Program, “Adjusted EBITDA” is defined as the Company’s consolidated earnings before interest expense, income taxes, depreciation and amortization (“EBITDA”), each as reported in CSS’ consolidated financial statements for the Company’s fiscal year ending March 31, 2019, as adjusted to reflect any adjustments to EBITDA determined by the Committee, in its sole discretion, at the time that these FY2019 Management Incentive Program Criteria are approved by the Committee. For purposes of this Program, “Net Sales” is defined in the same manner used by the Company for purposes of publicly reporting the Company’s net sales (for clarity, as of the approval date of this Program, the Company determines “net sales” as amounts invoiced to the Company’s customers less (i) estimated amounts for special programs to customers, such as volume incentives, new store allowances, defective goods, and other programs, and (ii) allowances for returns, damaged goods, shipping errors, and other items).

At the time that it approves these FY2019 Management Incentive Program Criteria, the Committee, in its sole discretion, shall determine: (i) the minimum threshold levels of Adjusted EBITDA and Net Sales that must be achieved in order for there to be payouts under the Adjusted EBITDA Component and the Net Sales Component (each a “Component”), respectively, (ii) the amount to be paid under each Component if the threshold level for that Component is attained, and (iii) the amount to be paid under each Component if the threshold for that Component is exceeded, i.e., the payout amount that corresponds to a specified level of achievement in excess of the threshold amount for each Component, including the levels of achievement required in order for the portion of each Award attributable to each Component to be paid at the target and maximum levels, respectively.

  

If the minimum threshold level is not achieved for a Component contingent upon achievement of such level, no Award for that Component will be paid.

Example: a Participant has a base salary of $40,000 effective as of April 1, 2018 and has a guideline percentage of 15%.

Guideline        Base Salary     Target Index

Percentage    *    as of 4/1/18    =    Amount

15%        *     $40,000    =     $6,000

The payout, if any, under the Adjusted EBITDA Component will be equal to the payout level, as determined by the Committee at the time that these FY2019 Management Incentive Program Criteria were approved, that corresponds to the level of Adjusted EBITDA achieved by the Company during its 2019 fiscal year. No portion of the Adjusted EBITDA Component of an Award will be paid unless and until the Committee shall have certified the actual level of Adjusted EBITDA achieved by the Company during its 2019 fiscal year in relation to the corresponding payout levels established by the Committee at the time that these FY2019 Management Incentive Program Criteria were approved.