Amended Exhibit A to 2020 LTIP and RSU Agreements
Performance Criteria Applicable to
|1. || |
Following the completion of the applicable three-year performance period, the Committee will determine the extent to which each of the Performance Goals related to Free Cash Flow and Annual Core Sales Growth as described below have been achieved. Each payout percentage calculated in accordance with Section 2 and Section 3 of this Exhibit A shall be multiplied by 50%, with the resulting sum of the two payout percentages (to two decimal places) multiplied by the TSR Modifier Percentage calculated in accordance with Section 4, if applicable, to determine the total payout percentage applicable to the Award (the Award Payout Percentage). The number of Performance-Based RSUs subject to the Award will be multiplied by the Award Payout Percentage to determine the adjusted number of Restricted Stock Units, and thus the number of shares of Common Stock or cash equivalents, to be issued upon vesting pursuant to each Key Employees Performance-Based Restricted Stock Unit grant. Notwithstanding the foregoing, (i) the Award Payout Percentage shall not exceed a maximum of two hundred percent (200%), and (ii) in the event the Companys ranking is in the bottom quartile of the TSR Comparator Group at the end of the three year performance period (as determined pursuant to Section 4 below), the Award Payout Percentage shall not exceed a maximum of one hundred percent (100%).
| ||a. || |
Free Cash Flow shall be measured on a cumulative basis over the entire three-year performance period commencing January 1, 2020 and ending December 31, 2022. The payout percentage for the Companys cumulative Free Cash Flow shall be determined in accordance with the Free Cash Flow targets and payout percentages established by the Committee prior to the grant date of the award.
| ||b. || |
The payout percentage for the Free Cash Flow target shall range from a minimum of zero percent (0%) to a maximum of two hundred percent (200%) based on actual performance relative to targets
| ||c. || |
For any actual performance figure which falls between two defined payment thresholds, the payout with respect to such performance criteria shall be determined by straight-line interpolation.
| ||d. || |
Free Cash Flow means operating cash flow for the total Company (including discontinued operations), as reported by the Company, less capital expenditures, subject only to the adjustments described below. Free Cash Flow shall exclude the impact of all cash costs related to the extinguishment of debt; debt and equity related financing costs; cash tax payments associated with the sale of a business unit or line of business; cash expenditures associated with the acquisition, or
(Ending Average Market Value Beginning Average Market Value) + Cumulative Annual Dividends
Beginning Average Market Value
Average Market Value means the simple average of the daily stock prices at close for each trading day during the applicable period beginning or ending on the specified date for which such closing price is reported by the New York Stock Exchange, Nasdaq Stock Exchange or other authoritative source the Committee may determine.
Beginning Average Market Value means the Average Market Value for the ninety (90) days ending December 31, 2019.
Cumulative Annual Dividends mean the cumulative dividends and other distributions with respect to a share of the Common Stock the record date for which occurs within the Performance Period.
Ending Average Market Value means the Average Market Value for the last ninety (90) days of the Performance Period.
Performance Period means the period beginning January 1, 2020 and ending December 31, 2022.
| ||d. || |
The payout percentage calculated under Sections 2 and 3 above will be multiplied by a percentage attributable to the Companys ranking in the TSR Comparator Group determined as follows (the TSR Modifier Percentage). The TSR Modifier Percentage will be 125% in the event the Companys ranking is in the top quartile of the TSR Comparator Group at the end of the Performance Period. The TSR Modifier Percentage will be 75% in the event the Companys ranking is in the bottom quartile of the TSR Comparator Group at the end of the Performance Period. Additionally, if the Companys ranking is in the bottom quartile of the TSR Comparator Group at the end of the Performance Period, the Award Payout Percentage will be no higher than target (100%), even if the calculation results in a higher payout. In the event the Companys ranking is in neither the top nor the bottom quartile of the TSR Comparator Group, this Section 4 will not apply and there will be no TSR Modifier Percentage and no adjustment to the payout percentage calculated under Sections 2 and 3 above.
| ||e. || |
For illustration, if the initial TSR Comparator Group has 24 companies (including the Company) at the beginning of the performance period and 5 of the companies have been merged out of existence or are no longer comparable by the end of the performance period, the TSR Modifier Percentage will be based on where the Company ranks among the remaining 19 companies as follows:
| || || || |
(Highest to Lowest)
| || Percentage || |
| || ||125% || |
| || ||125% || |
| || ||125% || |