Exhibit 10(m)(ix)
PERFORMANCE BONUS AGREEMENT
PERFORMANCE BONUS AGREEMENT (the "Agreement"), dated as of the 18th day of
February, 2005, between Albany International Corp., a Delaware corporation (the
"Company"), and [ _______________ ] (the "Participant").
WHEREAS, the Company adopted and maintains the Albany International Corp.
2005 Incentive Plan (the "Plan");
WHEREAS, Section 8 of the Plan provides for the grant of performance-based
awards to participants in the Plan; and
WHEREAS, Section 9 of the Plan provides for the annual establishment of
performance measures ("Performance Measures") for performance-based awards;
NOW THEREFORE, in consideration of the agreements and obligations
hereinafter set forth, the parties hereto agree as follows:
1. Definitions; References.
As used herein, the following terms shall have the meanings indicated
below. Capitalized terms used but not defined herein shall have the meanings
assigned to them in the Plan.
(i) "Annual Distribution Amount" shall mean, with respect to a Bonus, the
portion of such Bonus that is required to be distributed in any calendar year
determined pursuant to Section 6 hereof.
(ii) "Applicable Bonus Percentage" for the Participant for the Performance
Period shall mean the percentage established by the Committee for the
Participant in Section 4 hereof. The Committee shall in every case provide for a
specific Applicable Bonus Percentage when the Performance Percentage is equal to
100%, which Applicable Bonus Percentage will be used to determine the Target
Amount.
(iii) "Beneficiary" shall mean the person(s) designated by the Participant
in a written instrument delivered pursuant to the Plan to receive a payment due
under the Plan upon the Participant's death, signed by the Participant and
delivered to the Company prior to the Participant's death or, if no such written
instrument is on file, the Participant's estate.
(iv) "Bonus" with respect to the Performance Period shall mean a number of
shares of Common Stock equal to the product of the Target Amount multiplied by
the Applicable Bonus Percentage for the Performance Period, together with the
Cash Dividend Equivalents, if any, provided for from time to time pursuant to
Section 5(b).
(v) "Bonus Account" shall have the meaning set forth in Section 5 hereof.
(vi) "Cash Dividend Equivalents" shall have the meaning set forth in
Section 5(b) hereof.
(vii) "Cause" shall be deemed to exist if a majority of the members of the
Board of Directors determine that the Participant has (i) caused substantial
harm to the Company with intent to do so or as a result of gross negligence in
the performance of his or her duties; (ii) not made a good faith effort to carry
out his or her duties; (iii) wrongfully and substantially enriched himself or
herself at the expense of the Company; or (iv) been convicted of a felony.
(viii) "Determination Date" shall mean, with respect to the Performance
Period, the date on which the Committee shall have determined the Performance
Percentage for the Participant and whether the Bonus shall be paid in cash or in
shares of Common Stock, which date shall not be later than the last day of the
first February following the Performance Period and shall have determined.
(ix) "Disability" shall be deemed to exist if (i) by reason of mental or
physical illness the Participant has not performed his or her duties for a
period of six consecutive months; and (ii) the Participant does not return to
the performance of his or her duties within thirty days after written notice is
given by Company or one of its subsidiaries that the Participant has been
determined by the Committee to be "Disabled" under the Company's long term
disability policy.
(x) "Dividend Payment Date" shall have the meaning set forth in Section
5(b) hereof.
(xi) "Fair Market Value" shall mean, with respect to any share of Common
Stock, the closing price of such share as reported in "New York Stock Exchange
Composite Transactions" in "The Wall Street Journal" for the relevant date or,
if no quotation shall have been made on such relevant date, on the next
preceding day on which there were quotations or, if the Company's shares of
Common Stock are not traded on such exchange, such price as reported on such
other securities market or exchange on which such shares are traded as the
Committee shall determine.
(xii) "First Distribution Date" is the first Business Day on or after
March 1 of the year immediately following the end of the Performance Period.
(xiii) "Performance Percentage" shall mean with respect to the Performance
Period the percentage determined pursuant to the Scorecard.
(xiv) "Performance Period" shall mean the period that begins on January 1
and ends on December 31 of the year specified in Section 3.
(xv) "Scorecard" shall mean a performance scorecard as set forth in
Section 3 hereof.
(xvi) "Second Distribution Date" is the first Business Day on or after
March 1 of the second year following the end of the Performance Period.
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(xvii) "Target Amount", with respect to the Performance Period, shall mean
a number of shares of Common Stock specified in Section 2, which is the amount
of the Bonus for the Performance Period if the Performance Percentage is 100%.
(xviii) "Third Distribution Date" is the first Business Day on or after
March 1 of the third year following the end of the Performance Period.
(xix) "Value" of shares of Common Stock on any date means the average Fair
Market Value of a share of Common Stock over the Business Days in the February
preceding such date.
2. Establishment of the Target Amount. Pursuant to, and subject to, the
terms and conditions set forth herein and in the Plan, the Company hereby
establishes the Participant's Target Amount at [ _______ ] shares of Common
Stock for the Performance Period. The Bonus shall be determined based on Target
Amount in the manner set forth in Sections 3 and 4 hereof.
3. Establishment of the Scorecard. Pursuant to, and subject to, the terms
and conditions set forth herein and in the Plan, the Company hereby establishes
the Scorecard, attached hereto as Exhibit A, based on the objective criteria
specified, with which to evaluate the Participant's performance for 2005 (the
"Performance Period"). The Scorecard shall represent an objective basis for
determining the Performance Percentage for 2005.
4. Adjustment of the Target Amount. As soon as practicable after the end
of the Performance Period, and in no event later than the last day of the first
February following the Performance Period, the Committee shall determine the
Performance Percentage based on the Scorecard. The Applicable Bonus Percentage
with respect to the Participant for the Performance Period shall be equal to the
Performance Percentage so determined. The Committee shall have discretion to
reduce (but not increase) the amount of the Bonus determined for the Participant
for the Performance Period at any time prior to the crediting of such Bonus to
the Participant's Bonus Account as provided in Section 5 below. The Committee
may, but shall not be required to, set forth in Exhibit B hereto such criteria
(which may be subjective) to be used as the basis by the Committee to make any
such reduction.
5. Bonus Account. Pursuant to, and subject to, the terms and conditions
set forth herein and in the Plan, the Company shall establish a Bonus Account in
the name of, and for the benefit of, the Participant (the "Bonus Account").
There shall be a separate Bonus Account for the Participant for each Performance
Period.
a. Within thirty (30) days of the Determination Date, but in no
event later than March 1 immediately following the Determination Date, the
Company shall credit to the Bonus Account the Bonus.
b. The Company shall credit the Bonus Account of each Participant as
of each date on which the Company pays a cash dividend on shares of Common
Stock (a "Dividend Payment Date") with additional shares of Common Stock,
the number of which shall be determined by first (i) multiplying the
number of shares of Common Stock in the Participant's Bonus Account on the
Dividend Payment Date by the per-share dollar
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amount of the dividend so paid, and then (ii) dividing the resulting
amount by the Fair Market Value of a share of Common Stock on the Dividend
Payment Date (such additional shares of Common Stock being referred to
herein as "Cash Dividend Equivalents").
The Company shall continue to maintain the Bonus Account until it
has satisfied all of its obligations hereunder, provided that the amounts
credited to the Bonus Account shall represent an unsecured obligation of
the Company and the Participant shall have the status of an unsecured
creditor in respect of such accounts.
6. Vesting; Payment of Annual Distribution Amount.
a. Twenty-five percent of the Bonus shall vest on January 1 of the
year immediately following the Performance Period, 50% of the Bonus shall
vest on January 1 of the second year following the Performance Period, and
the remainder of the Bonus shall vest on January 1 of the third year
following the Performance Period.
b. The Annual Distribution Amount shall be paid at the following
times:
i. On the First Distribution Date, an amount equal to 25%
of the Bonus shall be distributed by the Company or one
of its subsidiaries to the Participant, and the amount
credited to the Participant's Bonus Account shall be
debited by the amount so distributed.
ii. On the Second Distribution Date, an amount equal to 50%
of Bonus shall be distributed by the Company or one of
its subsidiaries to the Participant, and the amount
credited to the Participant's Bonus Account shall be
debited by the amount so distributed.
iii. On the Third Distribution Date, the remainder of the
Bonus shall be distributed by the Company or one of its
subsidiaries to the Participant, and the amount credited
to the Participant's Bonus Account shall be debited by
the amount so distributed such that the amount credited
to the Participant's Bonus Account shall be zero.
c. The Annual Distributions Amount shall be paid in the following
form:
i. The portion of the Bonus payable on the First
Distribution Date shall be paid in cash based on the
Value of the shares of Common Stock required to be
distributed; and
ii. One half of the portion of the Bonus payable on the
Second Distribution Date and the Third Distribution Date
shall be distributed in shares of Common Stock and the
other half of the portion of the Bonus payable on the
Second
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Distribution Date and the Third Distribution Date shall
be paid in cash based on the Value of the shares of
Common Stock required to be distributed.
d. In the event that a payment is called for hereunder to a
Participant who is deceased, such payment shall be made to such
Participant's Beneficiary.
7. Effect of Termination of Employment.
a. In the event the Participant's employment with the Company is
terminated for any reason during the Performance Period, no credit
provided for by Section 5 shall thereafter be made with respect to the
Participant's Bonus Account and the Participant shall not be entitled to
any payment under Section 6 or have any other rights with respect to the
Bonus.
b. In the event the Participant voluntarily terminates employment
with the Company any time after the end of the Performance Period, the
Participant shall forfeit any amount then credited to the Participant's
Bonus Account that had not vested in accordance with Section 6 hereof;
provided that, if the Participant shall have reached age 62 prior to any
such voluntary termination, 50% of the unvested amount then credited to
the Participant's Bonus Account shall vest and be distributed to the
Participant in accordance with the otherwise applicable provisions of this
Agreement and the remainder shall be forfeited and the Participant shall
not be entitled to any other payment under Section 6 or have any other
rights with respect to the Bonus.
c. In the event the Participant's employment with the Company
terminates due to the Participant's death or Disability or is terminated
by the Company other than for Cause, 50% of the unvested amount then
credited to the Participant's Bonus Account shall vest and be distributed
to the Participant in accordance with the otherwise applicable provisions
of this Agreement and the remainder shall be forfeited and the Participant
shall not be entitled to any other payment under Section 6 or have any
other rights with respect to the Bonus.
d. In the event the Company terminates the Participant's employment
for Cause, the Participant shall forfeit all amounts then credited to the
Participant's Bonus Account and the Participant shall not be entitled to
any other payment under Section 6 or have any other rights with respect to
the Bonus, unless the Committee determines otherwise in its absolute
discretion.
e. If counsel to the Committee notifies the Committee that a
distribution provided for by this Section 7 should be deferred in order to
avoid having a tax imposed on the Participant by Section 409A of the Code
by virtue of a failure to comply with Section 409A(a)(2)(b)(1) of the Code
(relating to distributions to "key employees") to such distribution, then
the distribution shall be deferred to the extent determined by the
Committee.
8. Elective Deferrals. The Participant may elect to defer any portion of
the Bonus by submitting a deferral election, a form of which is attached hereto
as Exhibit C, prior to
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the first day of the Performance Period; provided that the date on which the
deferred amount shall be paid must be the later of a specified date or six
months following the Participant's termination of employment with the Company.
9. Modification and Waiver. Except as provided in the Plan with respect to
determinations of the Committee and subject to the Company's Board of Directors'
right to amend the Plan, neither this Agreement nor any provision hereof can be
changed, modified, amended, discharged, terminated or waived orally or by any
course of dealing or purported course of dealing, but only by an agreement in
writing signed by the Participant and the Company. No such agreement shall
extend to or affect any provision of this Agreement not expressly changed,
modified, amended, discharged, terminated or waived or impair any right
consequent on such a provision. The waiver of or failure to enforce any breach
of this Agreement shall not be deemed to be a waiver or acquiescence in any
other breach thereof.
10. Notices. All notices and other communications hereunder shall be in
writing, shall be deemed to have been given if delivered in person or by
first-class registered or certified mail, return receipt requested, and shall be
deemed to have been given when personally delivered or five (5) days after
mailing to the following address (or to such other address as either party may
have furnished to the others in writing in accordance herewith, except that
notices of change of address shall only be effective upon receipt):
If to the Company:
Albany International Corp.
0000 Xxxxxxxx
Xxxxxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
Attention: Legal Department
If to the Participant, to the most recent address of the Participant that
the Company has in its records.
11. Participant Acknowledgement. The Participant hereby acknowledges
receipt of a copy of the Plan.
12. Incorporation of the Plan. All terms and provisions of the Plan are
incorporated herein and made part hereof as if stated herein. If any provision
hereof and of the Plan shall be in conflict, the terms of the Plan shall govern.
All capitalized terms used herein and not defined herein shall have the meanings
assigned to them in the Plan.
13. Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but each of which
together shall constitute one and the same document.
14. Governing Law; Choice of Forum. This Agreement shall be governed by
and interpreted in accordance with New York law, without regard to its conflicts
of law principles, and the parties hereby submit to the jurisdiction of the
courts and tribunals of New York.
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15. Binding Effect. This Agreement shall be binding upon, inure to the
benefit of, and be enforceable by the heirs, personal representatives and
successors of the parties hereto. Nothing expressed or referred to in this
Agreement is intended or shall be construed to give any person other than the
parties to this Agreement, or their respective heirs, personal representatives
or successors, any legal or equitable rights, remedy or claim under or in
respect of this Agreement or any provision contained herein.
16. Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated.
17. Miscellaneous. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
[Remainder of Page Left Intentionally Blank]
ALBANY INTERNATIONAL CORP.
By:_________________________________
Name:
Title:
[ ________________ ]
By:_________________________________
Name:
Title:
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EXHIBIT A
Albany International 2005 Performance Bonus Scorecard
Position: [ ______________ ]
------------------------------------ ----------- -------------------- ------------------------------------------------------------
Performance Metrics Weight Measurement Metric Percentage
------------------------------------ ----------- -------------------- ------------------------------------------------------------
0% 50% 100% 150% 200%
------------------------------------ ----------- -------------------- ------------ ----------- ----------- ----------- -----------
1. Increase Consolidated EBITDA* [ __ ]% Financial [ __ ] [ __ ] [ __ ] [ __ ] [ __ ]
vs. 2004 Statements
------------------------------------ ----------- -------------------- ------------ ----------- ----------- ----------- -----------
2. Achieve PMC Share of Market [ __ ]% Industry [ __ ]% [ __ ]% [ __ ]% [ __ ]% [ __ ]%
for Combined Association Data
[ _______________ ]
------------------------------------ ----------- -------------------- ------------ ----------- ----------- ----------- -----------
3. Increase Consolidated [ __ ]% Financial [ __ ] [ __ ] [ __ ] [ __ ] [ __ ]
Operating Income for Statements
[ ______________ ]
------------------------------------ ----------- -------------------- ------------ ----------- ----------- ----------- -----------
4. Increase Consolidated Net [ __ ]% Financial [ __ ] [ __ ] [ __ ] [ __ ] [ __ ]
Sales of [ __________ ] Statements
------------------------------------ ----------- -------------------- ------------ ----------- ----------- ----------- -----------
The Performance Percentage = ([___]% x Metric Percentage of Metric 1) + ([___]%
x Metric Percentage of Metric 2), etc. For performance between the data points
indicated, the Metric Percentage shall be the interpolated value based on the
next higher and lower data points. Neither the Applicable Percentage, nor any
Metric Percentage, shall exceed 200%.
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All of the foregoing calculations shall be performed in a manner consistent with
the Company's past practice.
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* EBITDA shall, to the extent required by GAAP, reflect expenses incurred
pursuant to the Plan, including amounts paid out under this or any Plan
award.
