EXHIBIT 10.3
CSS INDUSTRIES, INC.
MANAGEMENT INCENTIVE PROGRAM
(As
amended on June 3, 2008)
SECTION
1. PURPOSE; DEFINITIONS . The purpose of the CSS
Industries, Inc. Management Incentive Program (the “
Program" ) is to enable CSS Industries, Inc. (the “
Company ”) and its subsidiaries to motivate and reward
favorable performance by the Company’s executive officers and
other key employees of the Company and its subsidiaries by
providing such individuals with the opportunity to receive cash
bonus payments based upon the achievement of pre-established and
objective performance goals for each fiscal year. The Program
became effective on April 17, 2007 and was amended on
June 3, 2008.
For purposes
of the Program, the following terms will have the meanings defined
below, unless the context clearly requires a different
meaning:
(a) “
Award ” means a cash bonus under the Program.
(b) “
Board ” means the Board of Directors of the Company,
as constituted from time to time.
(c) “
Code ” means the Internal Revenue Code of 1986, as
amended, and any successor thereto.
(d) "
Committee ” means the Human Resources Committee of the
Board or such other committee appointed by the Board for purposes
of the Program, provided that the Human Resources Committee or such
other committee shall consist of members of the Board who are not
employees of the Company or any subsidiary or affiliate thereof
and, with respect to matters relating to Awards intended to
constitute “qualified performance-based compensation”
under Section 162(m) of the Code, who qualify as “outside
directors” under Section 162(m) of the Code.
(e) “
Fiscal Year ” means the period beginning on April 1
and ending on March 31.
(f) "
Participant ” means the executive officers of the
Company and any other key employee of the Company or any Subsidiary
selected by the Committee to participate in the Program.
(g) "
Performance Period ” means each Fiscal Year or another
period as designated by the Committee, so long as such period does
not exceed one year.
(h) “
Subsidiary ” means a subsidiary of the Company.
SECTION
2. ADMINISTRATION OF PROGRAM . The
Committee shall administer and interpret the Program, provided,
that, the Program will not be interpreted in a manner that
causes an Award intended to constitute “qualified
performance-based compensation” under Section 162(m) of the
Code to fail to so qualify. The Committee shall have the power,
from time to time, to: (i) select Participants;
(ii) determine the terms and conditions of each Award,
including without limitation the amount of cash, if any, to be paid
to each Participant; (iii) establish the performance objectives for
any Performance Period in accordance with Section 3 hereof and
certify whether such performance objectives have been obtained;
(iv) establish and amend rules and regulations relating to the
Program, and to make all other determinations necessary and
advisable for the administration of the Program; (v) adopt
subplans to the Program, and (vi) correct any defect, supply any
omission or reconcile any inconsistency in the Program or any
Award.
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Nothing in the
Program shall be deemed to limit the ability of the Committee to
grant Awards to Participants under the Program which are not
intended to qualify as “qualified performance-based
compensation” under Section 162(m) of the Code and which are
not exempt from the limitations thereof; provided, however, that in
no event may an Award be granted in substitution or replacement of
an Award intended to qualify as “qualified performance-based
compensation” under Section 162(m) of the Code.
All decisions
made by the Committee pursuant to the Program shall be made in the
Committee’s sole and absolute discretion and shall be final
and binding on the Participants and the Company and its
Subsidiaries. No member or former member of the Board or the
Committee shall be liable for any act, omission, interpretation,
construction or determination made in connection with the Program
other than as a result of such individual’s willful
misconduct.
SECTION
3. AWARDS .
(a)
Eligibility . The Committee shall designate the Participants
who shall be eligible to participate in the Program for a
Performance Period.
(b)
Performance Criteria. The Committee shall establish the
performance objective or objectives in writing that must be
satisfied in order for a Participant to receive an Award for that
Performance Period, which shall be established before the beginning
of the Period or during a period ending no later than the earlier
of (i) 90 days after the beginning of the Performance
Period or (ii) the date on which 25% of the Performance Period
has been completed, or such other date as may be required or
permitted under applicable regulations under Section 162(m) of the
Code. In addition, at that time the Committee will also specify in
writing the Performance Period during which the performance will be
measured, the portion of Awards that will be payable upon the full,
partial or over-achievement of specified performance objectives for
that Performance Period, and any other conditions that the
Committee deems appropriate and consistent with the Program and
Section 162(m) of the Code, with respect to any Award that is
intended to constitute “qualified performance-based
compensation” under Section 162(m) of the Code. Except with
respect to an Award that is not intended to constitute
“qualified performance-based compensation” under
Section 162(m) of the Code, such performance objectives shall be
objectively determinable and based upon one or more of the
following criteria, as determined by the Committee for the
applicable Performance Period (subject to adjustment in accordance
with Section 3(b) below): the price of the Company’s stock,
earnings per share, income before taxes and extraordinary items,
net income, operating income, revenues, earnings before income tax,
EBITDA (earnings before interest, taxes, depreciation and
amortization), operational cash flow, after-tax or pre-tax profits,
return on capital employed or return on invested capital, after-tax
or pre-tax return on stockholders’ equity, limiting the level
in, or increase in all or a portion of, the Company’s assets
and/or liabilities, stockholder return, return on equity, growth in
assets, unit volume, sales or market share, or strategic business
criteria consisting of one or more objectives based on meeting
specified revenue goals, market penetration goals, geographic
business expansion goals, cost targets or goals relating to
acquisitions or divestitures.
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