ROCKWELL AUTOMATION, INC. PERFORMANCE SHARE AGREEMENT (December 7, 2010)
Exhibit 10.3
ROCKWELL AUTOMATION, INC.
2008 LONG-TERM INCENTIVES PLAN
PERFORMANCE SHARE AGREEMENT
(December 7, 2010)
(December 7, 2010)
To:
In accordance with Section 4(f) of the 2008 Long-Term Incentives Plan (the “Plan”) of
Rockwell Automation, Inc. (“Rockwell Automation”),
_____
Performance Shares (as defined
in the Plan) have been granted to you today upon the terms and conditions of this Performance Share
Agreement (this “Agreement”), subject in all respects to the provisions of the Plan, as it
may be amended. Capitalized terms used in this Agreement and not otherwise defined herein shall
have the respective meanings ascribed to them in the Plan.
| 1. | Terms of Performance Shares. |
(a) Subject to the provisions of this Section 1, you shall be eligible to receive shares of
Stock or cash as determined in accordance with Section 1(e) of this Agreement in respect of the
Performance Shares subject to this Agreement (the “Performance Share Payout”) if you shall
continue as an Employee from the date hereof until December 7, 2013 (the “Performance Share
Period”). Except as otherwise provided in Section 1(c) of this Agreement, payment of such
shares of Stock or cash shall be paid in the calendar year in which the Performance Share Period
ends.
(b) If (i) you shall die or suffer a disability (as determined by the Corporation in its sole
discretion) that shall continue for a continuous period of at least six months during the period of
your continuous service as an Employee and prior to the end of the Performance Share Period; or
(ii) your employment by Rockwell Automation terminates on or after the first anniversary of the
date hereof and prior to the end of the Performance Share Period by reason of your retirement under
a retirement plan of Rockwell Automation (as determined by the Corporation in its sole discretion);
then you shall be eligible to receive at the time such Performance Shares would otherwise be
payable pursuant to Section 1(a) of this Agreement a prorated portion of the Performance Share
Payout in accordance with Section 1(e) of this Agreement equal to such Performance Share Payout,
multiplied by the percentage of days in the Performance Share Period during which you were an
Employee.
(c) To the extent permitted by Section 409A and except as is necessary to satisfy the
requirements of Section 409A, the following provisions shall apply in the event of a Change of
Control during the Performance Share Period:
(i) If during the period of your continuous service as an Employee and prior to the end of the
Performance Share Period (A) a Change of Control occurs that qualifies as a “409A Change of Control
Event” (as defined below), (B) all Performance Shares that are outstanding are either assumed or
substituted with comparable awards with the same payment triggers by the successor corporation in
such Change of Control or its parent corporation, and (C) within two years of such Change of
Control your employment is terminated (1) by reason of death or disability, (2) by you for a Change
of Control Good Reason, or (3) by the Corporation other than for Cause, all performance goals
applicable to the Performance Shares (and to any substituted awards) will be deemed achieved at
levels in accordance with Section 1(e) of this Agreement and all other terms and conditions met;
and you shall be entitled to receive promptly and in any event within ninety days following your
Separation from Service the Performance Share Payout in accordance with Section 1(e) of this
Agreement. For purposes of this Agreement, a “409A Change of Control Event” means a “Change of
Control Event” as defined in Treasury Regulation Section 1.409A-3(i)(5)(i) and set forth in
Treasury Regulation Section 1.409A-3(i)(5)(v)-(vii), applying the default rules and percentages set
forth in such Treasury Regulation.
(ii) If during the period of your continuous service as an Employee and prior to the end of
the Performance Share Period (A) a Change of Control occurs that qualifies as a “409A Change of
Control Event” (as defined above) and (B) all Performance Shares that are outstanding are not
either assumed or substituted with comparable awards with the same payment triggers by the
successor corporation in such Change of Control or its parent corporation, all performance goals
applicable to the Performance Shares (and to any substituted awards) will be deemed achieved at
levels in accordance with Section 1(e) of this Agreement and all other terms and conditions met;
and you shall be entitled to receive promptly and in any event within ninety days following such
Change in Control the Performance Share Payout in accordance with Section 1(e) of this Agreement.
(d) If you cease to be an Employee prior to satisfaction of any of the conditions set forth in
Section 1(a), 1(b) or 1(c) of this Agreement, you shall not be entitled to receive any Performance
Share Payout in respect of the Performance Shares subject to this Agreement and shall have no
further rights with respect to the Performance Shares subject to this Agreement.
(e) Subject to the provisions of this Section 1 (including, if Section 1(b) of this Agreement
is applicable, the proration requirements thereof), promptly following the end of the Performance
Share Period (or promptly following a 409A Change in Control Event or Separation from Service, as
the case may be, in the event Section 1(c) of this Agreement is applicable), and in any event
within the time periods set forth in Sections 1(a), 1(b), and 1(c) of this Agreement, the number of
shares of Stock (or the amount of cash) payable to you in respect of the Performance Shares subject
to this Agreement shall be determined by multiplying (i) the number of Performance Shares subject
to this Agreement by (ii) the applicable percentage determined by the Committee in accordance with
Attachment 1 hereto based on the total shareowner return of Rockwell
Automation Common Stock , assuming reinvestment of all
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dividends, for the period from October 1, 2010 to
September 30, 2013; provided, however, that if Section 1(c) of this Agreement is applicable, the
percentage under this Section 1(e)(ii) shall be deemed to be 100%. In determining such total
shareowner return, the price of the Stock on each of the first and last dates of such three-year
period will be determined by using the average of the daily closing prices per share of the Stock
as reported on the New York Stock Exchange Composite Transactions Reporting System for the 20
trading days immediately preceding such date. Any payout in respect of Performance Shares subject
to this Agreement may be in Stock, in cash or partly in Stock and partly in cash, as the Committee
may determine. Any cash amounts payable pursuant to this Section 1(e) will be calculated based
upon the Fair Market Value of the Stock on the trading day immediately preceding the payout date
(or such other date as the Committee shall determine in its sole discretion).
| 2. | Delivery of Shares or Cash. |
As promptly as practicable after (i) shares of Stock or cash have been determined by the
Committee to be payable in accordance with Section 1 of this Agreement in respect of the
Performance Shares subject to this Agreement and (ii) Rockwell Automation has been reimbursed for
all required withholding taxes in respect of the Stock and/or cash payable in respect of such
Performance Shares, and in accordance with the time periods set forth in Section 1 of this
Agreement, Rockwell Automation shall deliver to you (or in the event of your death, to your estate
or any person who acquires your interest in such Performance Shares by bequest or inheritance)
shares of Stock, cash or a combination thereof, as shall be determined by the Committee, in respect
of such Performance Shares.
| 3. | Forfeiture of Performance Shares. |
Notwithstanding any other provision of this Agreement, if at any time it shall become
impossible for you to receive any Performance Share Payout in respect of the Performance Shares
subject to this Agreement, all such Performance Shares shall be forfeited, and you shall have no
further rights of any kind or nature with respect thereto.
| 4. | Adjustments. |
If there shall be any change in or affecting shares of Stock on account of any stock dividend
or split, merger or consolidation, reorganization (whether or not Rockwell Automation is a
surviving corporation), recapitalization, reorganization, combination or exchange of shares or
other similar corporate changes or an extraordinary dividend in cash, securities or other property,
there shall be made or taken such amendments to this Agreement or the Performance Shares subject to
this Agreement as the Board of Directors may deem appropriate under the circumstances.
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| 5. | Transferability. |
This grant is not transferable by you otherwise than by will or by the laws of descent and
distribution, and the Stock and/or cash payable in respect of the Performance Shares subject to
this Agreement shall be deliverable, during your lifetime, only to you.
| 6. | Withholding. |
Rockwell Automation shall have the right, in connection with the delivery of any shares of
Stock or cash in respect of the Performance Shares subject to this Agreement, (i) to deduct from
any payment otherwise due by Rockwell Automation to you or any other person receiving delivery of
such shares or cash an amount equal to any taxes required to be withheld by law with respect to
such delivery, (ii) to require you or any other person receiving such delivery to pay to it an
amount sufficient to provide for any such taxes so required to be withheld, or (iii) to sell such
number of shares of Stock as may be necessary so that the net proceeds of such sale shall be an
amount sufficient to provide for any such taxes so required to be withheld.
| 7. | No Acquired Rights. |
You acknowledge, agree and consent that: (a) subject to Section 409A, the Plan is
discretionary and Rockwell Automation may amend, cancel or terminate the Plan at any time; (b) the
grant of the Performance Shares subject to this Agreement is a one-time benefit offered to you and
does not create any contractual or other right for you to receive any grant of performance shares
or benefits under the Plan in the future; (c) future grants, if any, shall be at the sole
discretion of Rockwell Automation, including, but not limited to, the timing of any grant, the
number of shares and forfeiture provisions; and (d) your participation in the Plan is voluntary.
| 8. | Applicable Law. |
This Agreement and Rockwell Automation’s obligation to deliver the Stock and/or cash payable
in respect of the Performance Shares subject to this Agreement shall be governed by and construed
and enforced in accordance with the laws of Delaware and the Federal law of the United States.
| 9. | 409A |
This Agreement is intended to comply with Section 409A and, to the maximum extent permitted,
this Agreement will be interpreted in accordance with such intention. Notwithstanding any other
provision of this Agreement to the contrary, the Company makes no representation that this Plan or
any amounts payable under this Agreement will be exempt from or comply with Section 409A and makes
no undertaking to preclude Section 409A from applying to this Agreement.
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To the extent that any amount payable under this Agreement constitutes an amount payable or
benefit to be provided under a “nonqualified deferred compensation
plan” (as defined in Section 409A) that is not exempt from Section 409A, and such amount is payable
as a result of a Separation from Service and you are a “specified employee” (as defined and
determined under Section 409A and any relevant procedures that Rockwell Automation may establish)
at the time of your Separation from Service, then, notwithstanding any other provision in this
Agreement to the contrary, such payment will not be made to you until the day after the date that
is six (6) months following your Separation from Service, at which time all payments that otherwise
would have been paid to you under this Agreement during that six-month period, but were not paid
because of this paragraph, will be paid in a single lump sum. This six-month delay will cease to
be applicable in the event of your death.
| 10. | Entire Agreement. |
This Agreement and the Plan embody the entire agreement and understanding between Rockwell
Automation and you with respect to the Performance Shares subject to this Agreement, and there are
no representations, promises, covenants, agreements or understandings with respect to such
Performance Shares other than those expressly set forth in this Agreement and the Plan. In the
event of any conflict between this Agreement and the Plan, the terms of the Plan shall govern,
except with respect to terms required to achieve compliance with Section 409A.
| ROCKWELL AUTOMATION, INC. |
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| By: | ||||
| Xxxxxxx X. Xxxxxxxx | ||||
| Senior Vice President, General Counsel and Secretary |
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Attachment 1 — Matrix
Dated:
Agreed to this day of
, 20
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