FALSE2022Q2000076374412/3120.006036900007637442022-01-012022-06-3000007637442022-07-29xbrli:shares00007637442022-04-012022-06-30iso4217:USD00007637442021-04-012021-06-3000007637442021-01-012021-06-300000763744us-gaap:RetainedEarningsMember2021-04-012021-06-30iso4217:USDxbrli:shares00007637442022-06-3000007637442021-12-3100007637442020-12-3100007637442021-06-300000763744us-gaap:CommonStockMember2020-12-310000763744us-gaap:AdditionalPaidInCapitalMember2020-12-310000763744us-gaap:RetainedEarningsMember2020-12-310000763744us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310000763744us-gaap:TreasuryStockMember2020-12-310000763744us-gaap:RetainedEarningsMember2021-01-012021-03-3100007637442021-01-012021-03-310000763744us-gaap:CommonStockMember2021-01-012021-03-310000763744us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-310000763744us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310000763744us-gaap:CommonStockMember2021-03-310000763744us-gaap:AdditionalPaidInCapitalMember2021-03-310000763744us-gaap:RetainedEarningsMember2021-03-310000763744us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-03-310000763744us-gaap:TreasuryStockMember2021-03-3100007637442021-03-310000763744us-gaap:CommonStockMember2021-04-012021-06-300000763744us-gaap:AdditionalPaidInCapitalMember2021-04-012021-06-300000763744us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-04-012021-06-300000763744us-gaap:CommonStockMember2021-06-300000763744us-gaap:AdditionalPaidInCapitalMember2021-06-300000763744us-gaap:RetainedEarningsMember2021-06-300000763744us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-06-300000763744us-gaap:TreasuryStockMember2021-06-300000763744us-gaap:CommonStockMember2021-12-310000763744us-gaap:AdditionalPaidInCapitalMember2021-12-310000763744us-gaap:RetainedEarningsMember2021-12-310000763744us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310000763744us-gaap:TreasuryStockMember2021-12-310000763744us-gaap:RetainedEarningsMember2022-01-012022-03-3100007637442022-01-012022-03-310000763744us-gaap:CommonStockMember2022-01-012022-03-310000763744us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-310000763744us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310000763744us-gaap:CommonStockMember2022-03-310000763744us-gaap:AdditionalPaidInCapitalMember2022-03-310000763744us-gaap:RetainedEarningsMember2022-03-310000763744us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-310000763744us-gaap:TreasuryStockMember2022-03-3100007637442022-03-310000763744us-gaap:RetainedEarningsMember2022-04-012022-06-300000763744us-gaap:CommonStockMember2022-04-012022-06-300000763744us-gaap:AdditionalPaidInCapitalMember2022-04-012022-06-300000763744us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-04-012022-06-300000763744us-gaap:CommonStockMember2022-06-300000763744us-gaap:AdditionalPaidInCapitalMember2022-06-300000763744us-gaap:RetainedEarningsMember2022-06-300000763744us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-06-300000763744us-gaap:TreasuryStockMember2022-06-300000763744us-gaap:ManufacturingFacilityMember2022-06-30xbrli:pure0000763744us-gaap:ConvertibleDebtMember2021-05-130000763744us-gaap:ConvertibleDebtMember2022-06-3000007637442021-05-130000763744us-gaap:WarrantMember2022-01-012022-06-300000763744us-gaap:WarrantMember2022-04-012022-06-3000007637442021-05-012021-05-310000763744us-gaap:ConvertibleDebtSecuritiesMember2022-01-012022-06-300000763744lcii:GirardSystemsAndGirardProductsLLCMember2022-03-012022-03-310000763744lcii:GirardSystemsAndGirardProductsLLCMember2022-03-310000763744us-gaap:SeriesOfIndividuallyImmaterialBusinessAcquisitionsMember2022-01-012022-06-300000763744us-gaap:SeriesOfIndividuallyImmaterialBusinessAcquisitionsMember2022-06-300000763744lcii:StampedePresentationProductsIncDbaExertisExertisMember2021-10-012021-10-310000763744lcii:StampedePresentationProductsIncDbaExertisExertisMember2021-10-310000763744lcii:FurrionMember2021-09-300000763744lcii:FurrionMember2021-09-012021-09-300000763744lcii:FurrionMember2021-12-312021-12-310000763744lcii:FurrionMember2022-06-302022-06-300000763744us-gaap:CustomerRelationshipsMemberlcii:FurrionMember2021-12-310000763744us-gaap:CustomerRelationshipsMemberlcii:FurrionMember2022-01-012022-06-300000763744us-gaap:CustomerRelationshipsMemberlcii:FurrionMember2022-06-300000763744us-gaap:OtherIntangibleAssetsMemberlcii:FurrionMember2021-12-310000763744us-gaap:OtherIntangibleAssetsMemberlcii:FurrionMember2022-01-012022-06-300000763744us-gaap:OtherIntangibleAssetsMemberlcii:FurrionMember2022-06-300000763744lcii:FurrionMember2021-12-310000763744lcii:FurrionMember2022-01-012022-06-300000763744lcii:FurrionMember2022-06-300000763744lcii:SchaudtGmbHElektrotechnikApparatebauSchaudtMember2021-04-300000763744lcii:SchaudtGmbHElektrotechnikApparatebauSchaudtMember2021-04-012021-04-300000763744lcii:OEMSegmentMember2021-12-310000763744lcii:AftermarketSegmentMember2021-12-310000763744lcii:OEMSegmentMember2022-01-012022-06-300000763744lcii:AftermarketSegmentMember2022-01-012022-06-300000763744lcii:OEMSegmentMember2022-06-300000763744lcii:AftermarketSegmentMember2022-06-300000763744us-gaap:CustomerRelationshipsMember2022-06-300000763744srt:MinimumMemberus-gaap:CustomerRelationshipsMember2022-01-012022-06-300000763744srt:MaximumMemberus-gaap:CustomerRelationshipsMember2022-01-012022-06-300000763744us-gaap:PatentsMember2022-06-300000763744srt:MinimumMemberus-gaap:PatentsMember2022-01-012022-06-300000763744srt:MaximumMemberus-gaap:PatentsMember2022-01-012022-06-300000763744us-gaap:TradeNamesMember2022-06-300000763744srt:MinimumMemberus-gaap:TradeNamesMember2022-01-012022-06-300000763744srt:MaximumMemberus-gaap:TradeNamesMember2022-01-012022-06-300000763744us-gaap:TradeNamesMember2022-06-300000763744us-gaap:NoncompeteAgreementsMember2022-06-300000763744us-gaap:NoncompeteAgreementsMembersrt:MinimumMember2022-01-012022-06-300000763744us-gaap:NoncompeteAgreementsMembersrt:MaximumMember2022-01-012022-06-300000763744us-gaap:LicensingAgreementsMember2022-06-300000763744srt:MinimumMemberus-gaap:LicensingAgreementsMember2022-01-012022-06-300000763744srt:MaximumMemberus-gaap:LicensingAgreementsMember2022-01-012022-06-300000763744us-gaap:CustomerRelationshipsMember2021-12-310000763744srt:MinimumMemberus-gaap:CustomerRelationshipsMember2022-01-012022-03-310000763744srt:MaximumMemberus-gaap:CustomerRelationshipsMember2022-01-012022-03-310000763744us-gaap:PatentsMember2021-12-310000763744srt:MinimumMemberus-gaap:PatentsMember2022-01-012022-03-310000763744srt:MaximumMemberus-gaap:PatentsMember2022-01-012022-03-310000763744us-gaap:TradeNamesMember2021-12-310000763744srt:MinimumMemberus-gaap:TradeNamesMember2022-01-012022-03-310000763744srt:MaximumMemberus-gaap:TradeNamesMember2022-01-012022-03-310000763744us-gaap:TradeNamesMember2021-12-310000763744us-gaap:NoncompeteAgreementsMember2021-12-310000763744us-gaap:NoncompeteAgreementsMembersrt:MinimumMember2022-01-012022-03-310000763744us-gaap:NoncompeteAgreementsMembersrt:MaximumMember2022-01-012022-03-310000763744us-gaap:LicensingAgreementsMember2021-12-310000763744srt:MinimumMemberus-gaap:LicensingAgreementsMember2022-01-012022-03-310000763744srt:MaximumMemberus-gaap:LicensingAgreementsMember2022-01-012022-03-310000763744lcii:PurchasedResearchandDevelopmentMember2021-12-310000763744us-gaap:ConvertibleDebtMember2021-12-310000763744us-gaap:LineOfCreditMember2022-06-300000763744us-gaap:LineOfCreditMember2021-12-310000763744us-gaap:MediumTermNotesMember2022-06-300000763744us-gaap:MediumTermNotesMember2021-12-310000763744lcii:ShelfLoanMember2022-06-300000763744lcii:ShelfLoanMember2021-12-310000763744lcii:OtherDebtMember2022-06-300000763744lcii:OtherDebtMember2021-12-310000763744us-gaap:LineOfCreditMemberlcii:JPMorganChaseBankN.A.WellsFargoBankN.A.BankofAmericaN.A.and1stSourceBankMember2018-12-140000763744us-gaap:LetterOfCreditMemberlcii:JpmorganChaseBankAndWellsFargoBankMember2016-04-270000763744lcii:PrudentialInvestmentManagementIncMemberus-gaap:LineOfCreditMember2018-12-140000763744lcii:PrudentialInvestmentManagementIncMemberus-gaap:LineOfCreditMemberlcii:NewTermLoanAmendmentNo4Member2021-12-070000763744us-gaap:MediumTermNotesMemberus-gaap:DebtInstrumentRedemptionPeriodOneMember2021-12-072021-12-070000763744us-gaap:MediumTermNotesMemberus-gaap:DebtInstrumentRedemptionPeriodTwoMember2021-12-072021-12-070000763744us-gaap:MediumTermNotesMemberus-gaap:DebtInstrumentRedemptionPeriodThreeMember2021-12-072021-12-070000763744us-gaap:MediumTermNotesMember2021-12-070000763744lcii:OptionOneMembersrt:MinimumMemberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:LineOfCreditMemberlcii:JPMorganChaseBankN.A.WellsFargoBankN.A.BankofAmericaN.A.and1stSourceBankMember2016-04-272016-04-270000763744srt:MaximumMemberlcii:OptionOneMemberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:LineOfCreditMemberlcii:JPMorganChaseBankN.A.WellsFargoBankN.A.BankofAmericaN.A.and1stSourceBankMember2018-12-142018-12-140000763744lcii:OptionOneMemberus-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:LineOfCreditMemberlcii:JPMorganChaseBankN.A.WellsFargoBankN.A.BankofAmericaN.A.and1stSourceBankMember2022-01-012022-06-300000763744srt:MinimumMemberus-gaap:LondonInterbankOfferedRateLIBORMemberlcii:OptionTwoMemberus-gaap:LineOfCreditMemberlcii:JPMorganChaseBankN.A.WellsFargoBankN.A.BankofAmericaN.A.and1stSourceBankMember2022-01-012022-06-300000763744srt:MaximumMemberus-gaap:LondonInterbankOfferedRateLIBORMemberlcii:OptionTwoMemberus-gaap:LineOfCreditMemberlcii:JPMorganChaseBankN.A.WellsFargoBankN.A.BankofAmericaN.A.and1stSourceBankMember2018-12-142018-12-140000763744us-gaap:LondonInterbankOfferedRateLIBORMemberlcii:OptionTwoMemberus-gaap:LineOfCreditMemberlcii:JPMorganChaseBankN.A.WellsFargoBankN.A.BankofAmericaN.A.and1stSourceBankMember2022-01-012022-06-300000763744lcii:JpmorganChaseBankAndWellsFargoBankMemberus-gaap:LineOfCreditMember2022-06-300000763744srt:MinimumMemberlcii:JpmorganChaseBankAndWellsFargoBankMemberus-gaap:LineOfCreditMember2022-01-012022-06-300000763744srt:MaximumMemberlcii:JpmorganChaseBankAndWellsFargoBankMemberus-gaap:LineOfCreditMember2022-01-012022-06-300000763744lcii:JpmorganChaseBankAndWellsFargoBankMemberus-gaap:LineOfCreditMember2022-01-012022-06-300000763744lcii:PrudentialInvestmentManagementIncMemberus-gaap:LineOfCreditMember2019-03-290000763744lcii:PrudentialInvestmentManagementIncMemberus-gaap:LineOfCreditMember2019-03-292019-03-290000763744lcii:PrudentialInvestmentManagementIncMemberus-gaap:LineOfCreditMember2014-02-240000763744us-gaap:ConvertibleDebtMember2021-05-132021-05-130000763744us-gaap:ConvertibleDebtMemberus-gaap:DebtInstrumentRedemptionPeriodOneMember2021-05-132021-05-13lcii:tradingDay0000763744us-gaap:DebtInstrumentRedemptionPeriodTwoMemberus-gaap:ConvertibleDebtMember2021-05-132021-05-130000763744us-gaap:FairValueInputsLevel1Member2022-06-300000763744us-gaap:MediumTermNotesMemberus-gaap:DebtInstrumentRedemptionPeriodOneMember2019-12-192019-12-1900007637442021-07-012021-09-300000763744us-gaap:CommonStockMember2021-07-012021-09-3000007637442021-10-012021-12-310000763744us-gaap:CommonStockMember2021-10-012021-12-3100007637442021-01-012021-12-310000763744us-gaap:CommonStockMember2021-01-012021-12-310000763744us-gaap:CommonStockMember2022-01-012022-06-300000763744lcii:DeferredAndRestrictedStockUnitMember2022-01-012022-06-300000763744lcii:DeferredAndRestrictedStockUnitMember2021-12-310000763744lcii:DeferredAndRestrictedStockUnitMember2022-06-300000763744us-gaap:StockCompensationPlanMember2022-01-012022-06-300000763744us-gaap:StockCompensationPlanMember2021-12-310000763744us-gaap:StockCompensationPlanMember2022-06-3000007637442021-05-132021-05-130000763744us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Member2022-06-300000763744us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Member2022-06-300000763744us-gaap:FairValueInputsLevel1Member2021-12-310000763744us-gaap:FairValueInputsLevel2Member2021-12-310000763744us-gaap:FairValueInputsLevel3Member2021-12-310000763744us-gaap:FairValueInputsLevel2Member2022-06-300000763744us-gaap:FairValueInputsLevel3Member2022-06-30lcii:segment0000763744lcii:OEMSegmentMemberus-gaap:SalesRevenueNetMemberus-gaap:ProductConcentrationRiskMember2022-01-012022-06-300000763744lcii:OEMSegmentMemberus-gaap:SalesRevenueNetMemberus-gaap:ProductConcentrationRiskMember2021-01-012021-06-300000763744lcii:TravelTrailerAndFifthWheelsMemberus-gaap:SalesRevenueNetMemberus-gaap:ProductConcentrationRiskMember2022-01-012022-06-300000763744lcii:AftermarketSegmentMemberus-gaap:SalesRevenueNetMemberus-gaap:ProductConcentrationRiskMember2022-01-012022-06-300000763744lcii:AftermarketSegmentMemberus-gaap:SalesRevenueNetMemberus-gaap:ProductConcentrationRiskMember2021-01-012021-06-300000763744lcii:TravelTrailerAndFifthWheelsMembercountry:US2022-04-012022-06-300000763744lcii:TravelTrailerAndFifthWheelsMemberlcii:InternationalMember2022-04-012022-06-300000763744lcii:TravelTrailerAndFifthWheelsMember2022-04-012022-06-300000763744lcii:TravelTrailerAndFifthWheelsMembercountry:US2021-04-012021-06-300000763744lcii:TravelTrailerAndFifthWheelsMemberlcii:InternationalMember2021-04-012021-06-300000763744lcii:TravelTrailerAndFifthWheelsMember2021-04-012021-06-300000763744country:USlcii:MotorhomesMember2022-04-012022-06-300000763744lcii:InternationalMemberlcii:MotorhomesMember2022-04-012022-06-300000763744lcii:MotorhomesMember2022-04-012022-06-300000763744country:USlcii:MotorhomesMember2021-04-012021-06-300000763744lcii:InternationalMemberlcii:MotorhomesMember2021-04-012021-06-300000763744lcii:MotorhomesMember2021-04-012021-06-300000763744country:USlcii:OEMsAdjacentIndustriesMember2022-04-012022-06-300000763744lcii:InternationalMemberlcii:OEMsAdjacentIndustriesMember2022-04-012022-06-300000763744lcii:OEMsAdjacentIndustriesMember2022-04-012022-06-300000763744country:USlcii:OEMsAdjacentIndustriesMember2021-04-012021-06-300000763744lcii:InternationalMemberlcii:OEMsAdjacentIndustriesMember2021-04-012021-06-300000763744lcii:OEMsAdjacentIndustriesMember2021-04-012021-06-300000763744country:USlcii:OEMSegmentMember2022-04-012022-06-300000763744lcii:InternationalMemberlcii:OEMSegmentMember2022-04-012022-06-300000763744lcii:OEMSegmentMember2022-04-012022-06-300000763744country:USlcii:OEMSegmentMember2021-04-012021-06-300000763744lcii:InternationalMemberlcii:OEMSegmentMember2021-04-012021-06-300000763744lcii:OEMSegmentMember2021-04-012021-06-300000763744country:USlcii:AftermarketSegmentMember2022-04-012022-06-300000763744lcii:InternationalMemberlcii:AftermarketSegmentMember2022-04-012022-06-300000763744lcii:AftermarketSegmentMember2022-04-012022-06-300000763744country:USlcii:AftermarketSegmentMember2021-04-012021-06-300000763744lcii:InternationalMemberlcii:AftermarketSegmentMember2021-04-012021-06-300000763744lcii:AftermarketSegmentMember2021-04-012021-06-300000763744country:US2022-04-012022-06-300000763744lcii:InternationalMember2022-04-012022-06-300000763744country:US2021-04-012021-06-300000763744lcii:InternationalMember2021-04-012021-06-300000763744lcii:TravelTrailerAndFifthWheelsMembercountry:US2022-01-012022-06-300000763744lcii:TravelTrailerAndFifthWheelsMemberlcii:InternationalMember2022-01-012022-06-300000763744lcii:TravelTrailerAndFifthWheelsMember2022-01-012022-06-300000763744lcii:TravelTrailerAndFifthWheelsMembercountry:US2021-01-012021-06-300000763744lcii:TravelTrailerAndFifthWheelsMemberlcii:InternationalMember2021-01-012021-06-300000763744lcii:TravelTrailerAndFifthWheelsMember2021-01-012021-06-300000763744country:USlcii:MotorhomesMember2022-01-012022-06-300000763744lcii:InternationalMemberlcii:MotorhomesMember2022-01-012022-06-300000763744lcii:MotorhomesMember2022-01-012022-06-300000763744country:USlcii:MotorhomesMember2021-01-012021-06-300000763744lcii:InternationalMemberlcii:MotorhomesMember2021-01-012021-06-300000763744lcii:MotorhomesMember2021-01-012021-06-300000763744country:USlcii:OEMsAdjacentIndustriesMember2022-01-012022-06-300000763744lcii:InternationalMemberlcii:OEMsAdjacentIndustriesMember2022-01-012022-06-300000763744lcii:OEMsAdjacentIndustriesMember2022-01-012022-06-300000763744country:USlcii:OEMsAdjacentIndustriesMember2021-01-012021-06-300000763744lcii:InternationalMemberlcii:OEMsAdjacentIndustriesMember2021-01-012021-06-300000763744lcii:OEMsAdjacentIndustriesMember2021-01-012021-06-300000763744country:USlcii:OEMSegmentMember2022-01-012022-06-300000763744lcii:InternationalMemberlcii:OEMSegmentMember2022-01-012022-06-300000763744country:USlcii:OEMSegmentMember2021-01-012021-06-300000763744lcii:InternationalMemberlcii:OEMSegmentMember2021-01-012021-06-300000763744lcii:OEMSegmentMember2021-01-012021-06-300000763744country:USlcii:AftermarketSegmentMember2022-01-012022-06-300000763744lcii:InternationalMemberlcii:AftermarketSegmentMember2022-01-012022-06-300000763744country:USlcii:AftermarketSegmentMember2021-01-012021-06-300000763744lcii:InternationalMemberlcii:AftermarketSegmentMember2021-01-012021-06-300000763744lcii:AftermarketSegmentMember2021-01-012021-06-300000763744country:US2022-01-012022-06-300000763744lcii:InternationalMember2022-01-012022-06-300000763744country:US2021-01-012021-06-300000763744lcii:InternationalMember2021-01-012021-06-300000763744us-gaap:OperatingSegmentsMemberlcii:OEMSegmentMember2022-04-012022-06-300000763744us-gaap:OperatingSegmentsMemberlcii:OEMSegmentMember2021-04-012021-06-300000763744us-gaap:OperatingSegmentsMemberlcii:OEMSegmentMember2022-01-012022-06-300000763744us-gaap:OperatingSegmentsMemberlcii:OEMSegmentMember2021-01-012021-06-300000763744us-gaap:OperatingSegmentsMemberlcii:AftermarketSegmentMember2022-04-012022-06-300000763744us-gaap:OperatingSegmentsMemberlcii:AftermarketSegmentMember2021-04-012021-06-300000763744us-gaap:OperatingSegmentsMemberlcii:AftermarketSegmentMember2022-01-012022-06-300000763744us-gaap:OperatingSegmentsMemberlcii:AftermarketSegmentMember2021-01-012021-06-300000763744lcii:OEMSegmentMemberlcii:ChassisChassisPartsandSlideoutMechanismsMember2022-04-012022-06-300000763744lcii:OEMSegmentMemberlcii:ChassisChassisPartsandSlideoutMechanismsMember2021-04-012021-06-300000763744lcii:OEMSegmentMemberlcii:ChassisChassisPartsandSlideoutMechanismsMember2022-01-012022-06-300000763744lcii:OEMSegmentMemberlcii:ChassisChassisPartsandSlideoutMechanismsMember2021-01-012021-06-300000763744lcii:WindowsandDoorsMemberlcii:OEMSegmentMember2022-04-012022-06-300000763744lcii:WindowsandDoorsMemberlcii:OEMSegmentMember2021-04-012021-06-300000763744lcii:WindowsandDoorsMemberlcii:OEMSegmentMember2022-01-012022-06-300000763744lcii:WindowsandDoorsMemberlcii:OEMSegmentMember2021-01-012021-06-300000763744lcii:FurnitureandMattressesMemberlcii:OEMSegmentMember2022-04-012022-06-300000763744lcii:FurnitureandMattressesMemberlcii:OEMSegmentMember2021-04-012021-06-300000763744lcii:FurnitureandMattressesMemberlcii:OEMSegmentMember2022-01-012022-06-300000763744lcii:FurnitureandMattressesMemberlcii:OEMSegmentMember2021-01-012021-06-300000763744lcii:AxlesandSuspensionSolutionsMemberlcii:OEMSegmentMember2022-04-012022-06-300000763744lcii:AxlesandSuspensionSolutionsMemberlcii:OEMSegmentMember2021-04-012021-06-300000763744lcii:AxlesandSuspensionSolutionsMemberlcii:OEMSegmentMember2022-01-012022-06-300000763744lcii:AxlesandSuspensionSolutionsMemberlcii:OEMSegmentMember2021-01-012021-06-300000763744lcii:OtherProductsMemberlcii:OEMSegmentMember2022-04-012022-06-300000763744lcii:OtherProductsMemberlcii:OEMSegmentMember2021-04-012021-06-300000763744lcii:OtherProductsMemberlcii:OEMSegmentMember2022-01-012022-06-300000763744lcii:OtherProductsMemberlcii:OEMSegmentMember2021-01-012021-06-30

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: June 30, 2022

or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________________ to _________________

Commission File Number: 001-13646
lcii-20220630_g1.jpg
LCI INDUSTRIES
(Exact name of registrant as specified in its charter)
Delaware13-3250533
(State or other jurisdiction of(I.R.S. Employer
incorporation or organization)Identification Number)
3501 County Road 6 East46514
Elkhart,Indiana(Zip Code)
(Address of principal executive offices)
(574) 535-1125
(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report) N/A

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $.01 par valueLCIINew York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  

1


Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer                            Accelerated filer
Non-accelerated filer                         Smaller reporting company
Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  

The number of shares outstanding of the registrant’s common stock, as of the latest practicable date (July 29, 2022) was 25,429,715 shares of common stock.

2




LCI INDUSTRIES

TABLE OF CONTENTS
Page
PART I  
  
 
  
 
  
 
 
  
 
  
 
  
 
  
 
  
 
  
PART II
  
 
  
 
  
 
  
 
EXHIBIT 31.1 - SECTION 302 CEO CERTIFICATION
  
EXHIBIT 31.2 - SECTION 302 CFO CERTIFICATION 
  
EXHIBIT 32.1 - SECTION 906 CEO CERTIFICATION 
  
EXHIBIT 32.2 - SECTION 906 CFO CERTIFICATION 

3




PART I – FINANCIAL INFORMATION
ITEM 1 – FINANCIAL STATEMENTS

LCI INDUSTRIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
 Three Months Ended 
June 30,
Six Months Ended 
June 30,
 2022202120222021
(In thousands, except per share amounts)    
Net sales$1,536,150 $1,093,720 $3,180,718 $2,093,978 
Cost of sales1,127,065 836,109 2,307,390 1,594,590 
Gross profit409,085 257,611 873,328 499,388 
Selling, general and administrative expenses190,296 163,629 384,838 303,975 
Operating profit218,789 93,982 488,490 195,413 
Interest expense, net6,191 3,472 12,443 6,177 
Income before income taxes212,598 90,510 476,047 189,236 
Provision for income taxes58,068 22,621 125,336 47,227 
Net income$154,530 $67,889 $350,711 $142,009 
Net income per common share:    
Basic$6.07 $2.69 $13.82 $5.63 
Diluted$6.06 $2.67 $13.76 $5.60 
Weighted average common shares outstanding:    
Basic25,438 25,275 25,377 25,230 
Diluted25,518 25,385 25,483 25,351 

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
4


LCI INDUSTRIES
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
 Three Months Ended 
June 30,
Six Months Ended 
June 30,
 2022202120222021
(In thousands)    
Net income$154,530 $67,889 $350,711 $142,009 
Other comprehensive income (loss):
Net foreign currency translation adjustment(13,688)1,507 (16,570)(2,082)
Actuarial gain on pension plans13,985 933 13,985 933 
Total comprehensive income$154,827 $70,329 $348,126 $140,860 

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
5


LCI INDUSTRIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
 June 30,December 31,
 20222021
(In thousands, except per share amount)  
ASSETS  
Current assets  
Cash and cash equivalents$54,988 $62,896 
Accounts receivable, net of allowances of $7,669 and $6,446 at June 30, 2022 and December 31, 2021, respectively
417,033 319,782 
Inventories, net1,155,171 1,095,907 
Prepaid expenses and other current assets70,510 88,300 
Total current assets1,697,702 1,566,885 
Fixed assets, net456,517 426,455 
Goodwill554,828 543,180 
Other intangible assets, net512,752 519,957 
Operating lease right-of-use assets203,221 164,618 
Other long-term assets57,676 66,999 
Total assets$3,482,696 $3,288,094 
LIABILITIES AND STOCKHOLDERS' EQUITY  
Current liabilities  
Current maturities of long-term indebtedness$20,979 $71,003 
Accounts payable, trade287,659 282,183 
Current portion of operating lease obligations34,167 30,592 
Accrued expenses and other current liabilities295,438 243,438 
Total current liabilities638,243 627,216 
Long-term indebtedness1,101,787 1,231,959 
Operating lease obligations179,854 143,436 
Deferred taxes28,376 43,184 
Other long-term liabilities140,079 149,424 
Total liabilities2,088,339 2,195,219 
Stockholders' equity
Common stock, par value $.01 per share
285 284 
Paid-in capital224,231 220,459 
Retained earnings1,231,089 930,795 
Accumulated other comprehensive loss(3,086)(501)
Stockholders' equity before treasury stock1,452,519 1,151,037 
Treasury stock, at cost(58,162)(58,162)
Total stockholders' equity1,394,357 1,092,875 
Total liabilities and stockholders' equity$3,482,696 $3,288,094 

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
6


LCI INDUSTRIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
 Six Months Ended 
June 30,
 20222021
(In thousands)  
Cash flows from operating activities:  
Net income$350,711 $142,009 
Adjustments to reconcile net income to cash flows provided by operating activities:  
Depreciation and amortization63,719 51,270 
Stock-based compensation expense13,701 13,859 
Deferred taxes(2,401)— 
Other non-cash items2,025 4,305 
Changes in assets and liabilities, net of acquisitions of businesses:
Accounts receivable, net(95,479)(142,489)
Inventories, net(51,811)(115,314)
Prepaid expenses and other assets25,746 (16,401)
Accounts payable, trade5,312 71,144 
Accrued expenses and other liabilities36,448 15,476 
Net cash flows provided by operating activities347,971 23,859 
Cash flows from investing activities:  
Capital expenditures(70,837)(42,005)
Acquisitions of businesses(51,789)(103,858)
Other investing activities2,204 (566)
Net cash flows used in investing activities(120,422)(146,429)
Cash flows from financing activities:  
Vesting of stock-based awards, net of shares tendered for payment of taxes(10,773)(7,925)
Proceeds from revolving credit facility729,400 554,693 
Repayments under revolving credit facility(836,500)(719,747)
Repayments under shelf loan, term loan, and other borrowings(60,902)(8,652)
Proceeds from issuance of convertible notes— 460,000 
Purchases of convertible note hedge contracts— (100,142)
Proceeds from issuance of warrants concurrent with note hedge contracts— 48,484 
Payment of debt issuance costs(4)(11,844)
Payment of dividends(49,572)(41,678)
Payment of contingent consideration and holdbacks related to acquisitions(6,039)(4,387)
Net cash flows (used in) provided by financing activities(234,390)168,802 
Effect of exchange rate changes on cash and cash equivalents (1,067)(92)
Net (decrease) increase in cash and cash equivalents(7,908)46,140 
Cash and cash equivalents at beginning of period62,896 51,821 
Cash and cash equivalents cash at end of period$54,988 $97,961 
Supplemental disclosure of cash flow information:  
Cash paid during the period for interest$10,558 $6,496 
Cash paid during the period for income taxes, net of refunds$110,871 $55,449 
Purchase of property and equipment in accrued expenses$3,157 $3,952 

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
7


LCI INDUSTRIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited)

(In thousands, except shares and per share amounts)Common
Stock
Paid-in
Capital
Retained
Earnings
Accumulated Other Comprehensive Income (Loss)Treasury
Stock
Total
Stockholders’
Equity
Balance - December 31, 2020$282 $227,407 $731,710 $7,089 $(58,162)$908,326 
Net income— — 74,120 — — 74,120 
Issuance of 97,086 shares of common stock pursuant to stock-based awards, net of shares tendered for payment of taxes
(7,768)— — — (7,767)
Stock-based compensation expense— 7,436 — — — 7,436 
Other comprehensive loss— — — (3,589)— (3,589)
Cash dividends ($0.75 per share)
— — (18,939)— — (18,939)
Dividend equivalents on stock-based awards— 325 (325)— — — 
Balance - March 31, 2021$283 $227,400 $786,566 $3,500 $(58,162)$959,587 
Net income— — 67,889 — — 67,889 
Issuance of 16,324 shares of common stock pursuant to stock-based awards, net of shares tendered for payment of taxes
(159)— — — (158)
Stock-based compensation expense— 6,423 — — — 6,423 
Purchase of convertible note hedge contracts, net of tax— (75,750)— — — (75,750)
Issuance of warrants— 48,484 — — — 48,484 
Other comprehensive income— — — 2,440 — 2,440 
Cash dividends ($0.90 per share)
— — (22,739)— — (22,739)
Dividend equivalents on stock-based awards— 388 (388)— — — 
Balance - June 30, 2021$284 $206,786 $831,328 $5,940 $(58,162)$986,176 


The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
8


LCI INDUSTRIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(Unaudited)

(In thousands, except shares and per share amounts)Common
Stock
Paid-in
Capital
Retained
Earnings
Accumulated Other Comprehensive Income (Loss)Treasury
Stock
Total
Stockholders’
Equity
Balance - December 31, 2021$284 $220,459 $930,795 $(501)$(58,162)$1,092,875 
Net income— — 196,181 — — 196,181 
Issuance of 138,208 shares of common stock pursuant to stock-based awards, net of shares tendered for payment of taxes
(10,570)— — — (10,569)
Stock-based compensation expense— 6,517 — — — 6,517 
Other comprehensive loss— — — (2,882)— (2,882)
Cash dividends ($0.90 per share)
— — (22,870)— — (22,870)
Dividend equivalents on stock-based awards— 392 (392)— — — 
Balance - March 31, 2022$285 $216,798 $1,103,714 $(3,383)$(58,162)$1,259,252 
Net income— — 154,530 — — 154,530 
Issuance of 18,245 shares of common stock pursuant to stock-based awards, net of shares tendered for payment of taxes
— (204)— — — (204)
Stock-based compensation expense— 7,184 — — — 7,184 
Other comprehensive income— — — 297 — 297 
Cash dividends ($1.05 per share)
— — (26,702)— — (26,702)
Dividend equivalents on stock-based awards— 453 (453)— — — 
Balance - June 30, 2022$285 $224,231 $1,231,089 $(3,086)$(58,162)$1,394,357 


The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
9




LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

1.    BASIS OF PRESENTATION

The Condensed Consolidated Financial Statements include the accounts of LCI Industries and its wholly-owned subsidiaries ("LCII" and collectively with its subsidiaries, the "Company," "we," "us," or "our"). LCII has no unconsolidated subsidiaries. LCII, through its wholly-owned subsidiary, Lippert Components, Inc. and its subsidiaries (collectively, "Lippert Components," "LCI," or "Lippert"), supplies, domestically and internationally, a broad array of engineered components for the leading original equipment manufacturers ("OEMs") in the recreation and transportation product markets, consisting primarily of recreational vehicles ("RVs") and adjacent industries including buses; trailers used to haul boats, livestock, equipment, and other cargo; trucks; boats; trains; manufactured homes; and modular housing. The Company also supplies engineered components to the related aftermarkets of these industries, primarily by selling to retail dealers, wholesale distributors, and service centers, as well as direct to retail customers via the Internet. At June 30, 2022, the Company operated over 130 manufacturing and distribution facilities located throughout North America and Europe.

Most industries where the Company sells products or where its products are used historically have been seasonal and are generally at the highest levels when the weather is moderate. Accordingly, the Company's sales and profits have generally been the highest in the second quarter and lowest in the fourth quarter. However, current and future seasonal industry trends have been, and may in the future be, different than in prior years due to various factors, including fluctuations in dealer inventories and the timing of dealer orders, the impact of international, national, and regional economic conditions and consumer confidence on retail sales of RVs and other products for which the Company sells its components, the impact of severe weather conditions on the timing of industry-wide shipments from time to time, as well as the coronavirus ("COVID-19") pandemic and related impacts. Additionally, many of the optional upgrades and non-critical replacement parts for RVs are purchased outside the normal product selling season, thereby causing Aftermarket Segment sales to be counter-seasonal, but this has been, and may in the future be, different as a result of the COVID-19 pandemic and related impacts.

The Company is not aware of any significant events which occurred subsequent to the balance sheet date but prior to the filing of this report that would have a material impact on the Condensed Consolidated Financial Statements. All significant intercompany balances and transactions have been eliminated.

In the opinion of management, the information furnished in this Form 10-Q reflects all adjustments necessary for a fair statement of the financial position and results of operations for the interim periods presented. The Condensed Consolidated Financial Statements have been prepared in accordance with the instructions to Form 10-Q, and therefore do not include some information necessary to conform to annual reporting requirements. Results for interim periods should not be considered indicative of results for the full year.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, net sales and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, the Company evaluates its estimates, including, but not limited to, those related to product returns, sales and purchase rebates, accounts receivable, inventories, goodwill and other intangible assets, net assets of acquired businesses, income taxes, warranty and product recall obligations, self-insurance obligations, operating lease right-of-use assets and obligations, asset retirement obligations, long-lived assets, pension and post-retirement benefits, stock-based compensation, segment allocations, contingent consideration, environmental liabilities, contingencies, and litigation. The Company bases its estimates on historical experience, other available information, and various other assumptions believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities not readily apparent from other resources. Actual results and events could differ significantly from management estimates.

10

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
COVID-19 and Russia-Ukraine War Update

The ongoing COVID-19 pandemic and the conflict between Russia and Ukraine (the "Russia-Ukraine War") have caused significant uncertainty and disruption in the global economy and financial markets. Management continues to closely monitor the impact of COVID-19 and the Russia-Ukraine War on all aspects of the business. The extent to which COVID-19 and/or the Russia-Ukraine War may impact the Company's liquidity, financial condition, and results of operations in the future remains uncertain.

2.    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Condensed Consolidated Financial Statements presented herein have been prepared by the Company in accordance with the accounting policies described in its December 31, 2021 Annual Report on Form 10-K and should be read in conjunction with the Notes to Consolidated Financial Statements which appear in that report.

There are no recent accounting pronouncements that have been issued and not yet adopted that are expected to have a material impact on our Condensed Consolidated Financial Statements.

3.    EARNINGS PER SHARE

The following reconciliation details the denominator used in the computation of basic and diluted earnings per share for the periods indicated:
 Three Months Ended 
June 30,
Six Months Ended 
June 30,
(In thousands)2022202120222021
Weighted average shares outstanding for basic earnings per share
25,438 25,275 25,377 25,230 
Common stock equivalents pertaining to stock-based awards
80 110 106 121 
Weighted average shares outstanding for diluted earnings per share
25,518 25,385 25,483 25,351 
Equity instruments excluded from diluted net earnings per share calculation as the effect would have been antidilutive112 139 111 143 
For the Company's 1.125 percent convertible senior notes due 2026 (the "Convertible Notes") issued in May 2021, the dilutive effect is calculated using the if-converted method. The Company is required, pursuant to the indenture governing the Convertible Notes, dated May 13, 2021, by and between the Company and U.S. Bank National Association, as trustee (the "Indenture"), to settle the principal amount of the Convertible Notes in cash and may elect to settle the remaining conversion obligation (i.e., the stock price in excess of the conversion price) in cash, shares of the Company's common stock, or a combination thereof. Under the if-converted method, the Company includes the number of shares required to satisfy the conversion obligation, assuming all the Convertible Notes are converted. Because the average closing price of the Company's common stock for the six months ended June 30, 2022, which is used as the basis for determining the dilutive effect on earnings per share, was less than the conversion price of $165.65, all associated shares were antidilutive.

In conjunction with the issuance of the Convertible Notes, the Company, in privately negotiated transactions with certain commercial banks (the "Counterparties") sold warrants to purchase 2.8 million shares of the Company's common stock (the "Warrants"). The Warrants have a strike price of $259.84 per share, subject to customary anti-dilution adjustments. For calculating the dilutive effect of the Warrants, the Company uses the treasury stock method. With this method, the Company assumes exercise of the Warrants at the beginning of the period, or at time of issuance if later, and issuance of common shares upon exercise. Proceeds from the exercise of the Warrants are assumed to be used to repurchase shares of the Company's common stock at the average market price during the period. The incremental shares, representing the number of shares assumed to be received upon the exercise of the Warrants less the number of shares repurchased, are included in diluted shares. For the six months ended June 30, 2022, the average share price was below the Warrant strike price of $259.84 per share, and therefore 2.8 million shares were considered antidilutive.

11

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
In connection with the issuance of the Convertible Notes, the Company entered into privately negotiated call option contracts on the Company's common stock (the "Convertible Note Hedge Transactions") with the Counterparties. The Company paid an aggregate amount of $100.1 million to the Counterparties pursuant to the Convertible Note Hedge Transactions. The Convertible Note Hedge Transactions cover, subject to anti-dilution adjustments substantially similar to those in the Convertible Notes, approximately 2.8 million shares of the Company's common stock, the same number of shares initially underlying the Convertible Notes, at a strike price of approximately $165.65, subject to customary anti-dilution adjustments. The Convertible Note Hedge Transactions will expire upon the maturity of the Convertible Notes, subject to earlier exercise or termination. Exercise of the Convertible Note Hedge Transactions would reduce the number of shares of the Company's common stock outstanding, and therefore would be antidilutive.

4.    ACQUISITIONS, GOODWILL AND OTHER INTANGIBLE ASSETS

Acquisitions Completed During the Six Months Ended June 30, 2022

Girard

In March 2022, the Company acquired substantially all of the business assets of Girard Systems and Girard Products LLC (collectively "Girard"), a manufacturer and distributor of proprietary awnings and tankless water heaters for OEMs and aftermarket customers in the RV, specialty vehicle, and related industries. The total fair value of consideration was approximately $70.0 million. The Company paid $50.0 million in cash consideration at closing, with $20.0 million paid on July 1, 2022. The deferred acquisition fixed payment was recorded on the Condensed Consolidated Balance Sheet in accrued expenses and other current liabilities at June 30, 2022.

The purchase price is subject to customary adjustments for working capital. The results of the acquired business have been included in the Condensed Consolidated Statements of Income since the acquisition date, in both the Company's OEM and Aftermarket Segments. As the operations of this acquisition are not considered to have a material impact on the Company's financial statements, pro forma results of operations and other disclosures are not presented.

The Company is in the process of determining the fair value of the assets acquired and liabilities assumed for the opening balance sheet, including net working capital, deferred taxes, and the fair value of intangible assets. The current estimates for intangible assets are based on a preliminary valuation and these estimates are subject to change when the valuation is finalized within the measurement period (not to exceed 12 months from the acquisition date). The acquisition of this business was preliminarily recorded, as updated, as of the acquisition date as follows (in thousands):

Cash consideration$50,000 
Fixed deferred consideration20,000 
Total fair value of consideration given$70,000 
Identifiable intangible assets$45,020 
Other assets acquired and liabilities assumed, net13,673 
Total fair value of net assets acquired$58,693 
Goodwill (tax deductible)$11,307 

The consideration given was greater than the fair value of the net assets acquired, resulting in goodwill.

Other Acquisitions in 2022

During the six months ended June 30, 2022, the Company completed one other acquisition for $1.7 million of cash purchase consideration. The preliminary purchase price allocation resulted in $0.8 million of goodwill (tax deductible). As this acquisition is not considered to have a material impact on the Company's financial statements, pro forma results of operations and other disclosures are not presented.


12

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Acquisitions with Measurement Period Adjustments During the Six Months Ended June 30, 2022
Exertis

In October 2021, the Company acquired certain business assets of Stampede Presentation Products, Inc. d/b/a Exertis ("Exertis"), a global distribution company, in exchange for $39.7 million. The acquisition qualifies as a business combination for accounting purposes and supports the acquisition of Furrion Holdings Limited ("Furrion") by allowing the Company to provide logistics and warehousing to serve Furrion's North American customer base. The results of the acquired business have been included in the Condensed Consolidated Statements of Income since the acquisition date, primarily in the Company's OEM Segment. As the operations of this acquisition are not considered to have a material impact on the Company's financial statements, pro forma results of operations and other disclosures are not presented.

The Company had a pre-existing relationship with Exertis where Exertis had a prepaid asset and the Company had an equal and offsetting deferred revenue liability of $24.8 million, which was effectively settled immediately prior to the business combination. No gain or loss was recognized in the effective settlement of the deferred revenue liability.

During the six months ended June 30, 2022, the Company adjusted the preliminary purchase price allocation reported at December 31, 2021 to account for updates to net working capital balances. These measurement period adjustments would not have resulted in a material impact on the prior period results if the adjustments had been recognized as of the acquisition date. The purchase price allocation is subject to adjustment for net working capital and the fair value of intangible assets as additional information is obtained within the measurement period (not to exceed 12 months from the acquisition date).

Furrion

In September 2021, the Company acquired 100 percent of the share capital of Furrion, a leading distributor of a large range of appliances and other products to OEMs and aftermarket customers in the RV, specialty vehicle, utility trailer, horse trailer, marine, transit bus, and school bus industries. The total fair value of consideration, net of cash acquired, was approximately $146.7 million. The Company paid $50.5 million in cash consideration at closing, net of cash acquired, with fixed payments of $31.3 million due on each of the first and second anniversaries of the acquisition in September 2022 and September 2023. The deferred acquisition fixed payments are recorded at their respective discounted present values in the Condensed Consolidated Balance Sheet in accrued expenses and other current liabilities and other long-term liabilities at June 30, 2022.

In 2019, the Company and Furrion agreed to terminate an exclusive distribution and supply agreement and transition all sale and distribution of Furrion products then handled by the Company to Furrion. Effective January 1, 2020, Furrion took responsibility for distributing its products directly to the customer and assumed all responsibilities previously carried out by the Company relating to Furrion products. Upon termination of the agreement, Furrion purchased from the Company all non-obsolete stock and certain obsolete and slow-moving stock of Furrion products at the cost paid by the Company. At the date of the Furrion acquisition in September 2021, the Company had a receivable balance of $35.0 million (the "Receivable from Furrion") and Furrion had a corresponding payable balance. In direct connection with the acquisition negotiations, the receivable and payable were effectively settled in the acquisition and the receivable balance is included within the approximate $146.7 million of consideration transferred. No gain or loss was recognized in the effective settlement of the Receivable from Furrion.

The results of the acquired business have been included in the Condensed Consolidated Statements of Income since the acquisition date, in both the Company's OEM and Aftermarket Segments. As this acquisition is not considered to have a material impact on the Company's financial statements, pro forma results of operations and other disclosures are not presented.

During the six months ended June 30, 2022, the Company adjusted the preliminary purchase price allocation reported at December 31, 2021 to account for updates to net working capital, intangible assets, and fixed asset balances. These measurement period adjustments would not have resulted in a material impact on the prior period results if the adjustments had been recognized as of the acquisition date. The Company is in the process of determining the fair value of the assets acquired and liabilities assumed for the opening balance sheet, including the evaluation of technical tax matters regarding the transaction, and evaluating the various assumptions and forecasts which drove the purchase price allocation which could impact the fair value of intangible assets. The current estimates for intangible assets are based on a preliminary valuation and these estimates are subject to change when the valuation is finalized within the measurement period (not to exceed 12 months from the
13

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
acquisition date). The acquisition of this business was preliminarily recorded, as updated, as of the acquisition date as follows (in thousands):
Preliminary at December 31, 2021Measurement Period AdjustmentsAs Adjusted at June 30, 2022
Cash consideration, net of cash acquired$50,534 $— $50,534 
Effective settlement of Receivable from Furrion34,956 — 34,956 
Discounted value of fixed deferred consideration61,191 — 61,191 
Total fair value of consideration given$146,681 $— $146,681 
Customer relationships$66,300 $(10,600)$55,700 
Other identifiable intangible assets43,900 (1,200)42,700 
Other assets acquired and liabilities assumed, net(9,518)1,841 (7,677)
Total fair value of net assets acquired$100,682 $(9,959)$90,723 
Goodwill (tax deductible)$45,999 $9,959 $55,958 

Schaudt

In April 2021, the Company acquired 100 percent of the equity interests of Schaudt GmbH Elektrotechnik & Apparatebau ("Schaudt"), a leading supplier of electronic controls and energy management systems for the European caravan industry located in Markdorf, Germany. The purchase price was approximately $29.4 million. The results of the acquired business have been included in the Condensed Consolidated Statements of Income since the acquisition date, primarily in the Company's OEM Segment. As operations of this acquisition are not considered to have a material impact on the Company's financial statements, pro forma results of operations and other disclosures are not presented.

During the six months ended June 30, 2022, the Company adjusted and finalized the preliminary purchase price allocation reported at December 31, 2021 to account for updates to net working capital and fixed asset balances. These measurement period adjustments would not have resulted in a material impact on the prior period results if the adjustments had been recognized as of the acquisition date.

Goodwill

Changes in the carrying amount of goodwill by reportable segment were as follows:
(In thousands)OEM SegmentAftermarket SegmentTotal
Net balance – December 31, 2021$379,463 $163,717 $543,180 
Acquisitions – 202210,284 1,809 12,093 
Measurement period adjustments8,871 1,092 9,963 
Foreign currency translation(9,503)(905)(10,408)
Net balance – June 30, 2022
$389,115 $165,713 $554,828 
Goodwill represents the excess of the total consideration given in an acquisition of a business over the fair value of the net tangible and identifiable intangible assets acquired. Goodwill is not amortized, but instead is tested at the reporting unit level for impairment annually in November, or more frequently if certain circumstances indicate a possible impairment may exist.

14

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Other Intangible Assets

Other intangible assets consisted of the following at June 30, 2022:
(In thousands)Gross
Cost
Accumulated
Amortization
Net
Balance
Estimated Useful
Life in Years
Customer relationships$506,528 $144,573 $361,955 6to17
Patents120,262 57,894 62,368 3to20
Trade names (finite life)93,703 17,979 75,724 3to20
Trade names (indefinite life)7,600 — 7,600 Indefinite
Non-compete agreements11,582 6,566 5,016 3to6
Other309 220 89 2to12
Other intangible assets$739,984 $227,232 $512,752    
Other intangible assets consisted of the following at December 31, 2021:
(In thousands)Gross
Cost
Accumulated
Amortization
Net
Balance
Estimated Useful
Life in Years
Customer relationships$487,853 $127,048 $360,805 6to17
Patents116,725 53,479 63,246 3to20
Trade names (finite life)93,994 16,497 77,497 3to20
Trade names (indefinite life)7,600 — 7,600 Indefinite
Non-compete agreements11,464 5,439 6,025 3to6
Other309 212 97 2to12
Purchased research and development4,687 — 4,687 Indefinite
Other intangible assets$722,632 $202,675 $519,957    

5.    INVENTORIES

Inventories are stated at the lower of cost (first-in, first-out (FIFO) method) or net realizable value. Cost includes material, labor, and overhead. Inventories consisted of the following at:
 June 30,December 31,
(In thousands)20222021
Raw materials$829,437 $833,992 
Work in process57,704 48,250 
Finished goods268,030 213,665 
Inventories, net$1,155,171 $1,095,907 

15

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
6.    FIXED ASSETS

Fixed assets consisted of the following at:
 June 30,December 31,
(In thousands)20222021
Fixed assets, at cost$907,345 $842,462 
Less accumulated depreciation and amortization450,828 416,007 
Fixed assets, net$456,517 $426,455 

7.    ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consisted of the following at:
 June 30,December 31,
(In thousands)20222021
Employee compensation and benefits$94,585 $85,760 
Deferred acquisition payments and contingent consideration*54,523 39,307 
Current portion of accrued warranty40,172 33,874 
Other106,158 84,497 
Accrued expenses and other current liabilities$295,438 $243,438 
* Includes current portion of contingent consideration (Note 11) and deferred acquisition payments (Note 4).
Estimated costs related to product warranties are accrued at the time products are sold. In estimating its future warranty obligations, the Company considers various factors, including the Company's historical warranty costs, warranty claim lag, and sales. The following table provides a reconciliation of the activity related to the Company's accrued warranty, including both the current and long-term portions, for the six months ended June 30:
(In thousands)20222021
Balance at beginning of period$52,114 $47,091 
Provision for warranty expense28,164 12,304 
Warranty liability from acquired businesses— 125 
Warranty costs paid(18,646)(15,360)
Balance at end of period61,632 44,160 
Less long-term portion(21,460)(18,790)
Current portion of accrued warranty at end of period$40,172 $25,370 

8.    PENSION PLANS

The Company maintains two partially-funded defined benefit pension plans (the "Dutch pension plans") based in the Netherlands. The Dutch pension plans, which are qualified defined benefit pension plans, provide benefits based on years of service and average pay. The benefits earned by the employees are immediately vested. The Company funds the future obligations of the Dutch pension plans by purchasing non-participating annuities from a large multi-national insurance company that cover the vested pension benefit obligation of the participants, but do not cover future indexations or cost of living adjustments that are provided in plan benefits. Each year, the Company makes premium payments to the insurance company (1) to provide for the benefit obligation of the current year of service based on each employee's age, gender, and current salary, and (2) for indexations for both active and post-active participants. The Company determines the fair value of the plan assets with the assistance of an actuary using unobservable inputs (Level 3), which is determined as the present value of the accrued benefits guaranteed by the insurer. The components of net periodic pension cost for the Dutch pension plans were as follows:
16

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Three Months Ended June 30,Six Months Ended June 30,
(In thousands)2022202120222021
Net service cost$(1,020)$(1,107)$(2,090)$(2,216)
Interest cost(263)(166)(539)(332)
Expected return on plan assets164 109 336 217 
Administrative charges(67)(72)(140)(143)
Net periodic pension cost$(1,186)$(1,236)$(2,433)$(2,474)

9.    LONG-TERM INDEBTEDNESS

Long-term debt consisted of the following:
 June 30,December 31,
(In thousands)20222021
Convertible Notes$460,000 $460,000 
Revolving Credit Loan283,900 403,953 
Term Loan385,000 395,000 
Shelf-Loan Facility— 50,000 
Other4,359 5,997 
Unamortized deferred financing fees(10,493)(11,988)
1,122,766 1,302,962 
Less current portion(20,979)(71,003)
Long-term indebtedness$1,101,787 $1,231,959 

Credit Agreement

The Company and certain of its subsidiaries are party to a credit agreement dated December 14, 2018 with JPMorgan Chase, N.A., as a lender and administrative agent, and other bank lenders (as amended, the "Credit Agreement"). The Credit Agreement provides for a $600.0 million revolving credit facility (of which $50.0 million is available for the issuance of letters of credit (the "LC Facility") and up to $400.0 million is available in approved foreign currencies (the "Foreign Sublimit")). The Credit Agreement also provides for term loans (the "Term Loan") to the Company in an aggregate principal amount of $400.0 million. The maturity date of the Credit Agreement is December 7, 2026. The Term Loan is required to be repaid in an amount equal to 1.25 percent of the original principal amount of the Term Loan for the first eight quarterly periods commencing with the quarter ended December 31, 2021, 1.875 percent of the original principal amount of the Term Loan for the next eight quarterly periods, and then 2.50 percent of the original principal amount of the Term Loan of each additional payment until the maturity date. The Credit Agreement also permits the Company to request an increase to the revolving and/or term loan facility by up to an additional $400.0 million in the aggregate upon the approval of the lenders providing any such increase.

Borrowings under the Credit Agreement in U.S. dollars are designated from time to time by the Company as (i) base rate loans which bear interest at a base rate plus additional interest ranging from 0.0 percent to 0.625 percent (0.125 percent was applicable at June 30, 2022) depending on the Company’s total net leverage ratio or (ii) term benchmark loans which bear interest at LIBOR (or a relevant benchmark replacement rate) for an interest period selected by the Company plus additional interest ranging from 0.875 percent to 1.625 percent (1.125 percent was applicable at June 30, 2022) depending on the Company’s total net leverage ratio. Foreign currency borrowings, other than Pounds Sterling, have the same additional interest margins applicable to term benchmark loans based on the Company's total net leverage ratio. At June 30, 2022, the Company had $29.4 million in issued, but undrawn, standby letters of credit under the LC Facility. Availability under the Company’s revolving credit facility was $286.7 million at June 30, 2022. A commitment fee ranging from 0.150 percent to 0.225 percent (0.175 percent was applicable at June 30, 2022) depending on the Company's total net leverage ratio accrues on the actual daily amount that the revolving commitment exceeds the revolving credit exposure.

17

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Shelf-Loan Facility

The Company and certain of its subsidiaries have a shelf-loan facility (the "Shelf-Loan Facility") with PGIM, Inc. (formerly Prudential Investment Management, Inc.) and its affiliates ("Prudential"). On March 29, 2019, the Company issued $50.0 million of Series B Senior Notes (the "Series B Notes") to certain affiliates of Prudential for a term of three years, at a fixed interest rate of 3.80 percent per annum, payable quarterly in arrears. The Series B Notes were paid in full in March 2022, and the Shelf-Loan Facility expires on November 11, 2022.

The Shelf-Loan Facility provides for Prudential to consider purchasing, at the Company's request, in one or a series of transactions, additional senior promissory notes of the Company in the aggregate principal amount of up to $200.0 million. Prudential has no obligation to purchase the senior promissory notes. Interest payable on the senior promissory notes will be at rates determined by Prudential within five business days after the Company issues a request to Prudential.

Convertible Notes

On May 13, 2021, the Company issued $460.0 million in aggregate principal amount of 1.125 percent convertible senior notes due 2026 in a private placement to certain qualified institutional buyers, resulting in net proceeds to the Company of approximately $447.8 million after deducting the initial purchasers' discounts and offering expenses payable by the Company. The Convertible Notes bear interest at a coupon rate of 1.125 percent per annum, payable semiannually in arrears on May 15 and November 15 of each year, beginning on November 15, 2021. The Convertible Notes will mature on May 15, 2026, unless earlier converted, redeemed, or repurchased, in accordance with their terms.

As of June 30, 2022, the conversion rate was 6.0787 shares of the Company's common stock per $1,000 principal amount of the Convertible Notes. The conversion rate of the Convertible Notes is subject to further adjustment upon the occurrence of certain specified events. In addition, upon the occurrence of a make-whole fundamental change (as defined in the Indenture) or upon a notice of redemption, the Company will, in certain circumstances, increase the conversion rate for a holder that elects to convert its Convertible Notes in connection with such make-whole fundamental change or notice of redemption, as the case may be.

Prior to the close of business on the business day immediately preceding January 15, 2026, the Convertible Notes are convertible at the option of the holders only under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on June 30, 2021 (and only during such calendar quarter), if the last reported sale price (as defined in the Indenture) per share of the Company's common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130 percent of the conversion price for the Convertible Notes on each applicable trading day; (2) during the five business day period after any ten consecutive trading day period (the "measurement period") in which the trading price (as defined in the Indenture) per $1,000 principal amount of the Convertible Notes for each trading day of the measurement period was less than 98 percent of the product of the last reported sale price of the Company's common stock and the conversion rate on each such trading day; (3) if the Company calls such Convertible Notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date, but only with respect to the Convertible Notes called (or deemed called) for redemption; or (4) upon the occurrence of certain specified corporate events described in the Indenture. On or after January 15, 2026, until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their Convertible Notes at any time, regardless of the foregoing circumstances. Upon conversion, the Company will pay cash up to the aggregate principal amount of the Convertible Notes to be converted and pay or deliver, as the case may be, cash, shares of the Company's common stock, or a combination of cash and shares of the Company's common stock, at the Company's election, in respect of the remainder, if any, of the Company's conversion obligation in excess of the aggregate principal amount of the Convertible Notes being converted.

The Company may not redeem the Convertible Notes prior to May 20, 2024. On or after May 20, 2024, the Company may redeem for cash all or any portion of the Convertible Notes, at the Company's option, if the last reported sale price of the Company's common stock has been at least 130 percent of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100 percent of the principal amount of the Convertible Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. Upon the occurrence of a fundamental change (as defined in the Indenture), subject to certain conditions, holders of the Convertible Notes may require the Company to repurchase for cash all
18

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
or any portion of their Convertible Notes in principal amounts of $1,000 or an integral multiple thereof at a repurchase price equal to 100 percent of the principal amount of the Convertible Notes to be repurchased, plus accrued and unpaid interest on such Convertible Notes to, but not including, the fundamental change repurchase date (as defined in the Indenture).

The Convertible Notes are senior unsecured obligations and rank senior in right of payment to all of the Company's indebtedness that is expressly subordinated in right of payment to the Convertible Notes, equal in right of payment with all the Company's liabilities that are not so subordinated, effectively junior to any of the Company's secured indebtedness to the extent of the value of the assets securing such indebtedness, and structurally junior to all indebtedness and other liabilities (including trade payables) of our subsidiaries. The Indenture contains customary terms and covenants, including that upon certain events of default occurring and continuing, either the named trustee or the holders of at least 25 percent of the aggregate principal amount of the outstanding Convertible Notes may declare 100 percent of the principal of, and accrued and unpaid interest, if any, on all the outstanding Convertible Notes to be due and payable.

The Convertible Notes are not registered securities nor listed on any securities exchange but may be actively traded by qualified institutional buyers. The fair value of the Convertible Notes of $415.2 million at June 30, 2022 was estimated using Level 1 inputs, as it is based on quoted prices for these instruments in active markets.

General

At June 30, 2022, the fair value of the Company's long-term debt under the Credit Agreement approximates the carrying value, as estimated using quoted market prices and discounted future cash flows based on similar borrowing arrangements.

Borrowings under both the Credit Agreement and the Shelf-Loan Facility are secured on a pari-passu basis by first priority liens on the capital stock or other equity interests of certain of the Company's direct and indirect subsidiaries (including up to 65 percent of the equity interests of certain "controlled foreign corporations").

Pursuant to the Credit Agreement and Shelf-Loan Facility, the Company shall not permit its net leverage ratio to exceed certain limits, shall maintain a minimum debt service coverage ratio, and must meet certain other financial requirements. At June 30, 2022, the Company was in compliance with all such requirements and expects to remain in such compliance for the next twelve months.

The Credit Agreement and the Shelf-Loan Facility include a maximum net leverage ratio covenant which limits the amount of consolidated outstanding indebtedness that the Company may incur on a trailing twelve-month EBITDA. This limitation did not impact the Company's ability to incur additional indebtedness under its revolving credit facility at June 30, 2022. The Company believes the availability of $286.7 million under the revolving credit facility under the Credit Agreement, along with its cash flows from operations, are adequate to finance the Company's anticipated cash requirements for the next twelve months.

10.    LEASES

The Company leases certain manufacturing and warehouse facilities, administrative office space, semi-tractors, trailers, forklifts, and other equipment through operating leases with unrelated third parties. The increase in lease costs for the three and six months ended June 30, 2022 compared to the three and six months ended June 30, 2021 was primarily driven by capacity expansions and leases assumed in acquisitions. The components of lease cost were as follows:
Three Months Ended June 30,Six Months Ended June 30,
(In thousands)2022202120222021
Operating lease cost$13,236 $11,317 $26,148 $20,415 
Short-term lease cost1,934 986 3,774 1,875 
Variable lease cost936 742 1,649 1,431 
Total lease cost$16,106 $13,045 $31,571 $23,721 

19

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
11.    COMMITMENTS AND CONTINGENCIES

Contingent Consideration

In connection with several business acquisitions, if certain sales targets for the acquired products are achieved, the Company would pay additional cash consideration. As required, the liability for this contingent consideration is measured at fair value quarterly, considering actual sales of the acquired products, updated sales projections, and the updated market participant weighted average cost of capital. Depending upon the weighted average costs of capital and future sales of the products which are subject to contingent consideration, the Company could record adjustments in future periods. The following table provides a reconciliation of the Company’s contingent consideration liability for the six months ended June 30, 2022:
(In thousands)
Balance at beginning of period$6,911 
Payments(5,008)
Accretion (a)
93 
Fair value adjustments (a) (b)
(1,886)
Balance at end of the period
110 
Less current portion in accrued expenses and other current liabilities(7)
Total long-term portion in other long-term liabilities$103 
(a) Recorded in selling, general and administrative expenses in the Condensed Consolidated Statements of Income.
(b) During the period ended June 30, 2022, the Company updated its sales projections for a product subject to contingent consideration and determined the probability of payment under the contingent arrangement to be remote. Consequently, the fair value of the contingent consideration liability related to this product was reduced by $1.9 million.

Product Recalls

From time to time, the Company cooperates with and assists its customers on their product recalls and inquiries, and occasionally receives inquiries directly from the National Highway Traffic Safety Administration regarding reported incidents involving the Company’s products. As a result, the Company has incurred expenses associated with product recalls from time to time and may incur expenditures for future investigations or product recalls.

Environmental

The Company's operations are subject to certain Federal, state, and local regulatory requirements relating to the use, storage, discharge, and disposal of hazardous materials used during the manufacturing processes. Although the Company believes its operations have been consistent with prevailing industry standards and are in substantial compliance with applicable environmental laws and regulations, one or more of the Company’s current or former operating sites, or adjacent sites owned by third-parties, have been affected, and may in the future be affected, by releases of hazardous materials. As a result, the Company may incur expenditures for future investigation and remediation of these sites, including in conjunction with voluntary remediation programs or third-party claims.

Litigation

In the normal course of business, the Company is subject to proceedings, lawsuits, regulatory agency inquiries, and other claims. All such matters are subject to uncertainties and outcomes that are not predictable with assurance. While these matters could materially affect operating results when resolved in future periods, management believes that, after final disposition, including anticipated insurance recoveries in certain cases, any monetary liability or financial impact to the Company beyond that provided in the Condensed Consolidated Balance Sheet as of June 30, 2022, would not be material to the Company's financial position or results of operations.

20

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
12.    STOCKHOLDERS' EQUITY

The following table summarizes information about shares of the Company's common stock at:
 June 30,December 31,
(In thousands)20222021
Common stock authorized75,000 75,000 
Common stock issued28,517 28,360 
Treasury stock3,087 3,087 
Common stock outstanding25,430 25,273 

The table below summarizes the regular quarterly dividends declared and paid during the periods ended June 30, 2022 and December 31, 2021:
(In thousands, except per share data)Per ShareRecord DatePayment DateTotal Paid
First Quarter 2021$0.75 03/12/2103/26/21$18,939 
Second Quarter 20210.90 06/04/2106/18/2122,739 
Third Quarter 20210.90 09/03/2109/17/2122,747 
Fourth Quarter 20210.90 12/03/2112/17/2122,746 
Total 2021$3.45 $87,171 
First Quarter 2022$0.90 03/11/2203/25/22$22,870 
Second Quarter 20221.05 06/03/2206/17/2226,702 
Total 2022$1.95 $49,572 

Deferred and Restricted Stock Units

The LCI Industries 2018 Omnibus Incentive Plan (the "2018 Plan") provides for the grant or issuance of stock units, including those that have deferral periods, such as deferred stock units ("DSUs"), and those with time-based vesting provisions, such as restricted stock units ("RSUs"), to directors, employees, and other eligible persons. Recipients of DSUs and RSUs are entitled to receive shares at the end of a specified vesting or deferral period. Holders of DSUs and RSUs receive dividend equivalents based on dividends granted to holders of the common stock, which dividend equivalents are payable in additional DSUs and RSUs, and are subject to the same vesting criteria as the original grant. DSUs vest (i) ratably over the service period, (ii) at a specified future date, or (iii) for certain officers, based on achievement of specified performance conditions. RSUs vest (i) ratably over the service period or (ii) at a specified future date. Transactions in DSUs and RSUs under the 2018 Plan are summarized as follows:
Number of SharesWeighted Average Price
Outstanding at December 31, 2021285,711 $110.41 
Issued2,602 107.52 
Granted156,701 120.61 
Dividend equivalents5,150 104.86 
Forfeited(4,054)118.69 
Vested(167,343)95.95 
Outstanding at June 30, 2022278,767 $121.58 

21

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Performance Stock Units

The 2018 Plan provides for performance stock units ("PSUs") that vest at a specific future date based on achievement of specified performance conditions. Transactions in PSUs under the 2018 Plan are summarized as follows:
Number of SharesWeighted Average Price
Outstanding at December 31, 2021149,961 $104.01 
Granted91,988 110.83
Dividend equivalents2,918 104.85
Forfeited(4,840)78.11
Vested(80,938)82.40
Outstanding at June 30, 2022159,089 $120.12 

Convertible Note Hedge Transactions

The Company paid an aggregate amount of $100.1 million in May 2021 to the Counterparties pursuant to the Convertible Note Hedge Transactions. The Convertible Note Hedge Transactions cover, subject to anti-dilution adjustments substantially similar to those in the Convertible Notes, approximately 2.8 million shares of the Company's common stock, the same number of shares initially underlying the Convertible Notes, at a strike price of approximately $165.65, subject to customary anti-dilution adjustments. The Convertible Note Hedge Transactions will expire upon the maturity of the Convertible Notes, subject to earlier exercise or termination. The Convertible Note Hedge Transactions are expected generally to reduce the potential dilutive effect to the Company's common stock of the conversion of the Convertible Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of the Convertible Notes which are converted, as the case may be, in the event the price per share of the Company's common stock, as measured under the terms of the Convertible Note Hedge Transactions, is greater than the strike price of the Convertible Note Hedge Transactions. The Convertible Note Hedge Transactions meet the criteria in Accounting Standards Codification ("ASC") 815-40 to be classified within stockholders' equity, and therefore the Convertible Note Hedge Transactions are not revalued after their issuance.

The Convertible Notes and the Convertible Note Hedge Transactions will be integrated for tax purposes. The accounting impact of this tax treatment makes the Convertible Note Hedge Transactions deductible as original issue discount for tax purposes over the term of the Convertible Notes and resulted in a $24.4 million deferred tax asset recognized through equity.

Warrant Transactions

In addition, concurrently with entering into the Convertible Note Hedge Transactions, the Company entered into separate, privately-negotiated Warrant transactions with the Counterparties, whereby the Company sold Warrants to purchase 2.8 million shares of the Company's common stock at an initial strike price of $259.84 per share, subject to customary anti-dilution adjustments, which is approximately 100 percent above the last reported sale price of the Company's common stock on May 10, 2021 (the "Warrant Transactions"). The Company received aggregate proceeds of $48.5 million from the Warrant Transactions with the Counterparties, with such proceeds partially offsetting the costs of entering into the Convertible Note Hedge Transactions. The Warrants expire in August 2026. If the market value per share of the Company's common stock, as measured under the Warrant Transactions, exceeds the strike price of the Warrants, the Warrants will have a dilutive effect on the Company's earnings per share, unless the Company elects, subject to certain conditions, to settle the Warrants in cash. The Warrants meet the criteria in ASC 815-40 to be classified within stockholders' equity, and therefore the Warrants are not revalued after issuance.

22

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
13.    FAIR VALUE MEASUREMENTS

Recurring

The following table presents the Company's assets and liabilities measured at fair value on a recurring basis at:
 June 30, 2022December 31, 2021
(In thousands)TotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3
Assets        
Pension plan assets (Note 8)
$33,095 $— $— $33,095 $52,296 $— $— $52,296 
Liabilities
Contingent consideration$110 $— $— $110 $6,911 $— $— $6,911 

Contingent Consideration Related to Acquisitions

Liabilities for contingent consideration related to acquisitions were estimated at fair value using management's projections for long-term sales forecasts, including assumptions regarding market share gains and future industry-specific economic and market conditions, and a market participant's weighted average cost of capital. For further information on the inputs used in determining the fair value, and a roll forward of the contingent consideration liability, see Note 11 of the Notes to Condensed Consolidated Financial Statements.

Changes in either of the inputs in isolation would result in a change in the fair value measurement. A change in the assumptions used for sales forecasts would result in a directionally similar change in the fair value liability, while a change in the weighted average cost of capital would result in a directionally opposite change in the fair value liability. If there is an increase in the fair value liability, the Company would record a charge to selling, general and administrative expenses, and if there were a decrease in the fair value liability, the Company would record a benefit in selling, general and administrative expenses.

14.    SEGMENT REPORTING

The Company has two reportable segments, the OEM Segment and the Aftermarket Segment. Intersegment sales are insignificant.

The OEM Segment, which accounted for 84 percent and 80 percent of consolidated net sales for the six months ended June 30, 2022 and 2021, respectively, manufactures and distributes a broad array of engineered components for the leading OEMs in the recreation and transportation product markets, consisting primarily of RVs and adjacent industries, including buses; trailers used to haul boats, livestock, equipment and other cargo; trucks; boats; trains; manufactured homes; and modular housing. Approximately 66 percent of the Company's OEM Segment net sales for the six months ended June 30, 2022 were of components for travel trailer and fifth-wheel RVs.

The Aftermarket Segment, which accounted for 16 percent and 20 percent of consolidated net sales for the six months ended June 30, 2022 and 2021, respectively, supplies engineered components to the related aftermarket channels of the recreation and transportation product markets, primarily to retail dealers, wholesale distributors, and service centers, as well as direct to retail customers via the Internet. The Aftermarket Segment also includes biminis, covers, buoys, fenders to the marine industry, towing products, truck accessories, appliances, air conditioners, televisions, sound systems, and the sale of replacement glass and awnings to fulfill insurance claims.

Decisions concerning the allocation of the Company's resources are made by the Company's chief operating decision maker ("CODM"), with oversight by the Board of Directors. The CODM evaluates the performance of each segment based upon segment operating profit or loss, generally defined as income or loss before interest and income taxes. Decisions concerning the allocation of resources are also based on each segment's utilization of assets. Management of debt is a corporate function. The accounting policies of the OEM and Aftermarket Segments are the same as those described in Note 2 of the Notes to Consolidated Financial Statements in the Company's Annual Report on Form 10-K for the year ended December 31, 2021.

23

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
The following tables present the Company's revenues disaggregated by segment and geography based on the billing address of the Company's customers:
Three Months Ended June 30, 2022Three Months Ended June 30, 2021
(In thousands)
U.S. (a)
Int’l (b)
Total
U.S. (a)
Int’l (b)
Total
OEM Segment:
RV OEMs:
Travel trailers and fifth-wheels$800,315 $14,194 $814,509 $508,810 $18,804 $527,614 
Motorhomes64,008 27,472 91,480 39,776 27,477 67,253 
Adjacent Industries OEMs323,715 46,574 370,289 232,495 37,292 269,787 
Total OEM Segment net sales1,188,038 88,240 1,276,278 781,081 83,573 864,654 
Aftermarket Segment:
Total Aftermarket Segment net sales240,246 19,626 259,872 209,997 19,069 229,066 
Total net sales$1,428,284 $107,866 $1,536,150 $991,078 $102,642 $1,093,720 
Six Months Ended June 30, 2022Six Months Ended June 30, 2021
(In thousands)
U.S. (a)
Int’l (b)
Total
U.S. (a)
Int’l (b)
Total
OEM Segment:
RV OEMs:
Travel trailers and fifth-wheels$1,737,950 $29,785 $1,767,735 $995,352 $35,278 $1,030,630 
Motorhomes124,154 54,580 178,734 79,193 50,653 129,846 
Adjacent Industries OEMs635,363 91,028 726,391 444,177 76,251 520,428 
Total OEM Segment net sales2,497,467 175,393 2,672,860 1,518,722 162,182 1,680,904 
Aftermarket Segment:
Total Aftermarket Segment net sales470,413 37,445 507,858 381,407 31,667 413,074 
Total net sales$2,967,880 $212,838 $3,180,718 $1,900,129 $193,849 $2,093,978 
(a) Net sales to customers in the United States of America
(b) Net sales to customers in countries domiciled outside of the United States of America

The following table presents the Company's operating profit by segment:
 Three Months Ended 
June 30,
Six Months Ended 
June 30,
(In thousands)2022202120222021
Operating profit:
OEM Segment$190,577 $63,334 $435,951 $142,621 
Aftermarket Segment28,212 30,648 52,539 52,792 
Total operating profit$218,789 $93,982 $488,490 $195,413 

24

LCI INDUSTRIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
The following table presents the Company's revenue disaggregated by product:
Three Months Ended 
June 30,
Six Months Ended 
June 30,
(In thousands)2022202120222021
OEM Segment:
Chassis, chassis parts, and slide-out mechanisms$486,591 $309,237 $1,046,311 $596,298 
Windows and doors301,985 256,722 632,343 506,642 
Furniture and mattresses229,520 168,804 471,746 324,048 
Axles and suspension solutions93,378 60,850 190,423 115,972 
Other164,804 69,041 332,037 137,944 
Total OEM Segment net sales1,276,278 864,654 2,672,860 1,680,904 
Total Aftermarket Segment net sales259,872 229,066 507,858 413,074 
Total net sales$1,536,150 $1,093,720 $3,180,718 $2,093,978 

25

LCI INDUSTRIES
ITEM 2 – MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the Company's Condensed Consolidated Financial Statements and Notes thereto included in Item 1 of Part 1 of this report, as well as the Company's Annual Report on Form 10-K for the year ended December 31, 2021.

LCI Industries ("LCII" and collectively with its subsidiaries, the "Company," "we," "us," or "our"), through its wholly-owned subsidiary, Lippert Components, Inc. and its subsidiaries (collectively, "Lippert Components," "LCI," or "Lippert"), supplies, domestically and internationally, a broad array of engineered components for the leading original equipment manufacturers ("OEMs") in the recreation and transportation product markets, consisting primarily of recreational vehicles ("RVs") and adjacent industries, including buses; trailers used to haul boats, livestock, equipment, and other cargo; trucks; boats; trains; manufactured homes; and modular housing. We also supply engineered components to the related aftermarkets of these industries, primarily by selling to retail dealers, wholesale distributors, and service centers, as well as direct to retail customers via the Internet.

We have two reportable segments, the OEM Segment and the Aftermarket Segment. Intersegment sales are insignificant. At June 30, 2022, we operated over 130 manufacturing and distribution facilities located throughout North America and Europe. See Note 14 of the Notes to Condensed Consolidated Financial Statements for further information regarding our segments.

Our OEM Segment manufactures or distributes a broad array of engineered components for the leading OEMs of RVs and adjacent industries, including buses; trailers used to haul boats, livestock, equipment and other cargo; trucks; boats; trains; manufactured homes; and modular housing. Approximately 65 percent of our OEM Segment net sales for the twelve months ended June 30, 2022 were of components for travel trailer and fifth-wheel RVs, including:
● Steel chassis and related components● Electric and manual entry steps
● Axles and suspension solutions● Awnings and awning accessories
● Slide-out mechanisms and solutions● Electronic components
● Thermoformed bath, kitchen, and other products● Appliances
● Vinyl, aluminum, and frameless windows● Air conditioners
● Manual, electric, and hydraulic stabilizer and 
   leveling systems
● Televisions and sound systems
● Entry, luggage, patio, and ramp doors● Tankless water heaters
● Furniture and mattresses● Other accessories
The Aftermarket Segment supplies many of these engineered components to the related aftermarket channels of the recreation and transportation product markets, primarily to retail dealers, wholesale distributors, and service centers, as well as direct to retail customers via the Internet. The Aftermarket Segment also includes biminis, covers, buoys, fenders to the marine industry, towing products, truck accessories, appliances, air conditioners, sound systems, and the sale of replacement glass and awnings to fulfill insurance claims.

Most industries where we sell products or where our products are used historically have been seasonal and are generally at the highest levels when the weather is moderate. Accordingly, our sales and profits have generally been the highest in the second quarter and lowest in the fourth quarter. However, current and future seasonal industry trends have been, and may in the future be, different than in prior years due to various factors, including fluctuations in dealer inventories and the timing of dealer orders, the impact of international, national, and regional economic conditions and consumer confidence on retail sales of RVs and other products for which the Company sells its components, the impact of severe weather conditions on the timing of industry-wide shipments from time to time, as well as the coronavirus ("COVID-19") pandemic and related impacts. Additionally, many of the optional upgrades and non-critical replacement parts for RVs are purchased outside the normal product selling season, thereby causing Aftermarket Segment sales to be counter-seasonal, but this has been, and may in the future be, different as a result of the COVID-19 pandemic and related impacts.

COVID-19 AND RUSSIA-UKRAINE WAR UPDATE

The ongoing COVID-19 pandemic has caused significant uncertainty and disruption in the global economy and financial markets since early 2020. With RV retail demand at record levels throughout 2021, the industry faced challenges with
26

LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
supply chain constraints, rising material and freight costs, and increases in direct labor costs due to higher production volumes and a tightened labor market, especially in Northern Indiana. These trends have continued through the first six months of 2022, and, with regard to supply chain constraints and freight costs, have also been impacted by the conflict between Russia and Ukraine (the "Russia-Ukraine War"). To address these challenges, we have continued to strategically manage working capital, including carrying elevated levels of certain inventory items to avoid future shortages. We continue to focus on our culture and leadership development programs to focus on team member retention. We continue to closely monitor the impact of COVID-19 and the Russia-Ukraine War on all aspects of our business. The extent to which COVID-19 and/or the Russia-Ukraine War may impact our liquidity, financial condition, and results of operations in the future remains uncertain.

INDUSTRY BACKGROUND

OEM Segment

North American Recreational Vehicle Industry

An RV is a vehicle designed as temporary living quarters for recreational, camping, travel or seasonal use. RVs may be motorized (motorhomes) or towable (travel trailers, fifth-wheel travel trailers, folding camping trailers, and truck campers).
The annual sales cycle for the RV industry generally starts in October after the "Open House" in Elkhart, Indiana where many of the largest RV OEMs display product to RV retail dealers and ends after the conclusion of the summer selling season in September in the following calendar year. Between October and March, industry-wide wholesale shipments of travel trailer and fifth-wheel RVs have historically exceeded retail sales as dealers build inventories to support anticipated sales. Between April and September, the spring and summer selling seasons, retail sales of travel trailer and fifth-wheel RVs have historically exceeded industry-wide wholesale shipments. Due to the COVID-19 pandemic, the 2021 and 2020 Open Houses were canceled. The seasonality of the RV industry has been, and will likely continue to be, impacted by the COVID-19 pandemic, and the timing of a return to historical seasonality is not possible to predict at this time.
According to the Recreation Vehicle Industry Association ("RVIA"), industry-wide wholesale shipments from the United States of travel trailer and fifth-wheel RVs in the first six months of 2022, our primary RV market, increased eight percent to 285,900 units, compared to the first six months of 2021, primarily due to dealers rebuilding inventory levels partially offset by a decrease in retail demand. Retail demand for travel trailer and fifth-wheel RVs decreased 26 percent in the first six months of 2022 compared to the same period in 2021. Retail demand has declined from recent elevated levels, partially driven by elevated fuel prices and rising interest rates impacting retail consumers. Retail demand is typically revised upward in subsequent months, primarily due to delayed RV registrations.
While we measure our OEM Segment RV sales against industry-wide wholesale shipment statistics, the underlying health of the RV industry is determined by retail demand. A comparison of the number of units and the year-over-year percentage change in industry-wide wholesale shipments and retail sales of travel trailers and fifth-wheel RVs, as reported by Statistical Surveys, Inc., as well as the resulting estimated change in dealer inventories, for both the United States and Canada, is as follows:
     Estimated
 WholesaleRetailUnit Impact on
 UnitsChangeUnitsChangeDealer Inventories
Quarter ended June 30, 2022133,700 0%125,600 (30)%8,100
Quarter ended March 31, 2022152,200 16%93,100 (19)%59,100
Quarter ended December 31, 2021130,400 13%76,500 (14)%53,900
Quarter ended September 30, 2021136,000 24%130,900 (18)%5,100
Twelve months ended June 30, 2022552,300 13%426,100 (22)%126,200
27

LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
     Estimated
 WholesaleRetailUnit Impact on
 UnitsChangeUnitsChangeDealer Inventories
Quarter ended June 30, 2021133,800 100%180,500 36%(46,700)
Quarter ended March 31, 2021131,200 49%114,500 52%16,700
Quarter ended December 31, 2020115,200 38%89,400 40%25,800
Quarter ended September 30, 2020110,100 37%159,100 35%(49,000)
Twelve months ended June 30, 2021490,300 54%543,500 40%(53,200)
According to the RVIA, industry-wide wholesale shipments of motorhome RVs in the first six months of 2022 increased three percent to 30,100 units compared to the first six months of 2021, primarily due to dealers rebuilding inventory levels. Retail demand for motorhome RVs decreased 12 percent year-over-year in the first six months of 2022, compared to a 32 percent year-over-year increase in retail demand in the same period of 2021. Retail demand has declined from recent elevated levels, partially driven by elevated fuel prices and rising interest rates impacting retail consumers.

Our current estimate for full-year 2022 industry-wide wholesale shipments from the United States of travel trailer, fifth-wheel, and motorhome RVs are approximately 500,000 to 530,000 units. This estimate suggests a decrease of 35 to 45 percent in the second half of 2022 compared to actual wholesale shipments in the first half of 2022. This projected decline is being driven by current dealer inventory levels, as well as elevated gas prices and rising interest rates impacting retail consumers.

Adjacent Industries

Our portfolio of products used in RVs can also be used in other applications, including buses; trailers used to haul boats, livestock, equipment and other cargo; trucks; boats; trains; manufactured homes; and modular housing (collectively, "Adjacent Industries"). In many cases, OEM customers of the Adjacent Industries are affiliated with RV OEMs through related subsidiaries. We believe there are significant opportunities in these Adjacent Industries.

We currently expect production in the marine and manufactured housing markets to remain at or near current run rates through the remainder of 2022.

Aftermarket Segment

Many of our OEM Segment products are also sold through various aftermarket channels of the recreation and transportation product markets, primarily to retail dealers, wholesale distributors, and service centers, as well as direct to retail customers via the Internet. This includes discretionary accessories and replacement service parts. We have teams dedicated to product, technical, and installation training as well as marketing support for our Aftermarket Segment customers. We also support multiple call centers to provide responses to customers for product, delivery, and technical support. This support is designed for a rapid response to critical repairs, so customer downtime is minimal. The Aftermarket Segment also includes biminis, covers, buoys, fenders to the marine industry, towing products, truck accessories, appliances, air conditioners, televisions, sound systems, and the sale of replacement glass and awnings to fulfill insurance claims. Many of the optional upgrades and non-critical replacements for RVs are purchased outside the normal product selling seasons, thereby causing certain Aftermarket Segment sales to be counter-seasonal, but this has been, and may in the future be, different as a result of the COVID-19 pandemic and related impacts.

According to Go RVing, estimated RV ownership in the United States as of 2020 had increased to over 11 million households. This vibrant market is a key driver for aftermarket sales, as we anticipate owners will likely upgrade their units as well as replace parts and accessories which have been subjected to normal wear and tear.

We currently expect to see continued reduction in aftermarket volumes in the second half of 2022 as a result of fully stocked distribution channels, chip shortages impacting truck markets, and the impacts of inflation on consumers' discretionary spending.

28

LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
RESULTS OF OPERATIONS

Consolidated Highlights

Consolidated net sales in the second quarter of 2022 were $1.5 billion, 40 percent higher than consolidated net sales for the same period of 2021 of $1.1 billion. The increase was primarily driven by increased selling prices, market share gains, acquisitions, and increased wholesale shipments. Net sales from acquisitions completed in the twelve months ended June 30, 2022, primarily Furrion Holdings Limited ("Furrion") and Girard Systems and Girard Products LLC (collectively, "Girard"), contributed approximately $80.7 million in the second quarter of 2022.
Net income for the second quarter of 2022 was $154.5 million, or $6.06 per diluted share, compared to net income of $67.9 million, or $2.67 per diluted share, for the same period of 2021.
Consolidated operating profit during the second quarter of 2022 was $218.8 million compared to $94.0 million in the same period of 2021. Operating profit margin was 14.2 percent in the second quarter of 2022 compared to 8.6 percent in the same period of 2021. The increase was primarily a result of increased selling prices which are indexed to select commodities, pricing changes to targeted products, and leveraging fixed costs over higher sales volumes, partially offset by increased raw material and freight costs.
The cost of aluminum and steel used in certain of our manufactured components increased in the second quarter of 2022 compared to the same period of 2021. Raw material costs are subject to continued fluctuation and are being partially offset by contractual selling prices which are indexed to select commodities.
The $26.7 million increase in selling, general and administrative costs in the second quarter of 2022 was primarily driven by incremental costs from recent acquisitions of $7.2 million, increases in personnel costs of $6.9 million, increases in transportation costs of $4.7 million due to higher volumes and rising freight costs, and incremental amortization of intangible assets from acquired businesses of $3.0 million.
The effective tax rate of 26.3 percent for the six months ended June 30, 2022 was higher than the comparable prior year period of 25.0 percent, primarily due to decreases in the excess tax benefit related to the vesting of equity-based compensation awards and the cash surrender value of life insurance, plus a discrete tax adjustment for an acquisition-related tax election in the current year period, as discussed below under "Income Taxes."
In June 2022, we paid a quarterly dividend of $1.05 per share, aggregating to $26.7 million.

OEM Segment - Second Quarter

Net sales of the OEM Segment in the second quarter of 2022 increased $411.6 million, compared to the same period of 2021. Net sales of components to the following OEMs markets for the three months ended June 30 were:
(In thousands)20222021Change
RV OEMs: 
Travel trailers and fifth-wheels$814,509 $527,614 54 %
Motorhomes91,480 67,253 36 %
Adjacent Industries OEMs370,289 269,787 37 %
Total OEM Segment net sales$1,276,278 $864,654 48 %

According to the RVIA, industry-wide wholesale unit shipments for the three months ended June 30 were:
 20222021Change
Travel trailer and fifth-wheel RVs133,700 133,800 %
Motorhomes14,800 14,800 — %

The trend in our average product content per RV produced is an indicator of our overall market share of components for new RVs. Our average product content per type of RV, calculated based upon our net sales of components to domestic RV
29

LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
OEMs for the different types of RVs produced for the twelve months ended June 30, divided by the industry-wide wholesale shipments of the different product mix of RVs for the same period, was:
Content per:20222021Change
Travel trailer and fifth-wheel RV$5,382 $3,621 49 %
Motorhome$3,569 $2,644 35 %

Our average product content per type of RV excludes international sales and sales to the Aftermarket Segment and Adjacent Industries. Content per RV is impacted by changes in selling prices for our products, market share gains, and acquisitions.

Our increase in net sales to RV OEMs of travel trailers, fifth-wheel, and motorhome components during the second quarter of 2022 was driven by selling price increases, market share gains, and acquisitions during the second quarter of 2022.

Our increase in net sales to OEMs in Adjacent Industries during the second quarter of 2022 was driven by selling price increase, market share gains, and wholesale production growth.

Operating profit of the OEM Segment was $190.6 million in the second quarter of 2022, an increase of $127.2 million compared to the same period of 2021. The operating profit margin of the OEM Segment in the second quarter of 2022 increased to 14.9 percent compared to 7.3 percent for the same period of 2021 and was positively impacted by:
Selling prices contractually tied to indices of select commodities increased, resulting in an increase in operating profit of $110.9 million compared to the same period of 2021.
Pricing changes to targeted products, resulting in an increase in operating profit of $42.9 million compared to the same period of 2021.
Leveraging of fixed costs over a larger sales base, which increased operating profit by $9.9 million related to fixed selling, general, and administrative costs and by $3.6 million related to fixed overhead costs.
Partially offset by:
Increases in material commodity costs, which negatively impacted operating profit by $60.1 million, primarily related to increased steel and aluminum costs.
Sales mix increase of lower margin products from the acquisition of Furrion and related integration costs, which negatively impacted operating profit by $6.3 million.
Additional amortization related to intangible assets from acquisitions completed in the last twelve months, which reduced operating profit by $3.3 million.
Amortization expense on intangible assets for the OEM Segment was $10.1 million in the second quarter of 2022, compared to $7.8 million in the same period in 2021. Depreciation expense on fixed assets for the OEM Segment was $14.4 million in the second quarter of 2022, compared to $12.1 million in the same period of 2021.

OEM Segment – Year to Date

Net sales of the OEM Segment in the first six months of 2022 increased 59 percent, or $1.0 billion, compared to the first six months of 2021. Net sales of components to OEMs were to the following markets for the six months ended June 30:
(In thousands)20222021Change
RV OEMs:   
Travel trailers and fifth-wheels$1,767,735 $1,030,630 72 %
Motorhomes178,734 129,846 38 %
Adjacent Industries OEMs726,391 520,428 40 %
Total OEM Segment net sales$2,672,860 $1,680,904 59 %

30

LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
According to the RVIA, industry-wide wholesale unit shipments for the six months ended June 30 were:
 20222021Change
Travel trailer and fifth-wheel RVs285,900 265,000 %
Motorhomes30,600 29,100 %

Our increase in net sales to RV OEMs of travel trailers, fifth-wheel, and motorhome components during the first six months of 2022 was driven by selling price increases, market share gains, and acquisitions during the first six months of 2022.

Our increase in net sales to OEMs in Adjacent Industries during the first six months of 2022 was driven by selling price increases, market share gains, and wholesale production growth. We continue to believe there are significant opportunities in Adjacent Industries.

Operating profit of the OEM Segment was $436.0 million in the first six months of 2022, an increase of $293.3 million compared to the same period of 2021. The operating profit margin of the OEM Segment in the first six months of 2022 increased to 16.3 percent, compared to 8.5 percent for the same period of 2021, and was positively impacted by:
Selling prices contractually tied to indices of select commodities increased, resulting in an increase in operating profit of $260.6 million compared to the same period of 2021.
Pricing changes to targeted products, resulting in an increase in operating profit of $94.7 million compared to the same period of 2021.
Leveraging of fixed costs over a larger sales base, which increased operating profit by $26.5 million related to fixed selling, general, and administrative costs and by $10.5 million related to fixed overhead costs.
Partially offset by:
Increases in material commodity costs, which negatively impacted operating profit by $170.3 million, primarily related to increased steel and aluminum costs.
Sales mix increase of lower margin products from the acquisition of Furrion and related integration costs, which negatively impacted operating profit by $11.3 million.
Additional amortization related to intangible assets from acquisitions completed in the last twelve months, which reduced operating profit by $6.8 million.
Amortization expense on intangible assets for the OEM Segment was $20.2 million in first six months of 2022, compared to $14.3 million in the same period of 2021. Depreciation expense on fixed assets for the OEM Segment was $28.9 million in first six months of 2022, compared to $24.8 million in the same period of 2021.

Aftermarket Segment - Second Quarter

Net sales of the Aftermarket Segment in the second quarter of 2022 increased 13 percent, or $30.8 million, compared to the same period of 2021. Net sales of components in the Aftermarket Segment were as follows for the three months ended June 30:
(In thousands)20222021Change
Total Aftermarket Segment net sales$259,872 $229,066 13 %

Net sales of the Aftermarket Segment increased during the second quarter of 2022, primarily due to selling price increases to targeted products and acquisitions.

Operating profit of the Aftermarket Segment was $28.2 million in the second quarter of 2022, a decrease of $2.4 million compared to the same period of 2021. The operating profit margin of the Aftermarket Segment was 10.9 percent in the second quarter of 2022, compared to 13.4 percent in the same period in 2021, and was negatively impacted by:
Increases in material commodity costs and production supplies, which negatively impacted operating profit by $31.7 million, primarily related to increased steel and aluminum costs.
The impact of fixed costs due to reduced organic volumes, which decreased operating profit by $3.7 million related to fixed selling, general, and administrative costs and $1.6 million related to fixed overhead costs.
31

LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
Investments in marketing activities and administrative structure of $5.0 million.
Increases in direct labor costs due to production volumes and a tight labor market, which reduced operating profit by $2.5 million.
Increases in transportation costs, primarily for third party freight, which reduced operating profit by $2.0 million.
Increases in production overhead costs in order to meet growing sales demands, which negatively impacted operating profit by $1.7 million.
Partially offset by:
Pricing changes to targeted products, resulting in an increase in operating profit of $37.0 million compared to the same period of 2021.
Sales mix increase of higher margin products from the acquisition of Furrion, which positively impacted operating profit by $4.2 million.
Amortization expense on intangible assets for the Aftermarket Segment was $3.8 million in the second quarter of 2022, compared to $3.5 million in the same period of 2021. Depreciation expense on fixed assets for the Aftermarket Segment was $3.6 million in the second quarter of 2022, compared to $3.3 million in the same period of 2021.

Aftermarket Segment – Year to Date

Net sales of the Aftermarket Segment in the first six months of 2022 increased 23 percent, or $94.8 million, compared to the same period of 2021. Net sales of components in the Aftermarket Segment were as follows for the six months ended June 30:
(In thousands)20222021Change
Total Aftermarket Segment net sales$507,858 $413,074 23 %

Net sales of the Aftermarket Segment increased during the first six months of 2022 primarily due to selling price increases and sales from acquisitions.
Operating profit of the Aftermarket Segment was $52.5 million in the first six months of 2022, a decrease of $0.3 million compared to the same period of 2021. The operating profit margin of the Aftermarket Segment was 10.3 percent in the first six months of 2022, compared to 12.8 percent in the same period in 2021, and was negatively impacted by:
Increases in material commodity costs and production supplies, which negatively impacted operating profit by $52.0 million, primarily related to increased steel and aluminum costs.
Investments in marketing costs, information technology, and administrative structure of $14.5 million.
Increases in transportation costs, primarily for third party freight, which reduced operating profit by $6.5 million.
Increases in production overhead costs in order to meet sales demands, which negatively impacted operating profit by $5.5 million.
The impact of fixed costs due to reduced organic volumes, which decreased operating profit by $3.5 million related to fixed selling, general, and administrative costs and $1.8 million related to fixed overhead costs.
Increases in direct labor costs due to production volumes and a tight labor market, which reduced operating profit by $3.0 million.
Additional amortization related to intangible assets from acquisitions completed in the last twelve months, which reduced operating profit by $1.2 million.
Partially offset by:
Pricing changes to targeted products, resulting in an increase in operating profit of $67.9 million compared to the same period of 2021.
Sales mix increase of higher margin products from the acquisition of Furrion and integration costs, which positively impacted operating profit by $8.1 million.
Amortization expense on intangible assets for the Aftermarket Segment was $7.6 million in first six months of 2022, compared to $6.4 million in the same period of 2021. Depreciation expense on fixed assets for the Aftermarket Segment was $7.1 million in first six months of 2022, compared to $5.8 million in the same period of 2021.

32

LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
Income Taxes

The effective tax rates for the six months ended June 30, 2022 and 2021 were 26.3 percent and 25.0 percent, respectively. The effective tax rate for the six months ended June 30, 2022 differed from the Federal statutory rate primarily due to state taxes, foreign taxes, and non-deductible expenses, partially offset by the recognition of excess tax benefits as a component of the provision for income taxes, and Federal and Indiana research and development credits. The increase in the effective tax rate for the six months ended June 30, 2022 as compared to the same period in 2021 was primarily due to decreases in the excess tax benefit related to the vesting of equity-based compensation awards and the cash surrender value of life insurance plus a discrete tax adjustment in the current year period for an acquisition-related tax election.

LIQUIDITY AND CAPITAL RESOURCES

Cash Flows

As of June 30, 2022, we had $55.0 million in cash and cash equivalents, and $286.7 million of availability under our revolving credit facility under the Credit Agreement. We paid off the full outstanding $50.0 million balance of our Shelf-Loan Facility in March 2022. See Note 9 of the Notes to Condensed Consolidated Financial Statements for a description of our credit facilities.

We maintain a level of liquidity sufficient to allow us to meet our cash needs in the short term. Over the long term, we manage our cash and capital structure to maximize shareholder return, maintain our financial condition, and maintain flexibility for our future strategic investments. We continuously assess our capital requirements, working capital needs, debt and leverage levels, debt and lease maturity schedules, capital expenditure requirements, dividends, future investments or acquisitions, and potential share repurchases. With elevated demand continuing into the first six months of 2022, the industry has faced challenges with supply chain constraints, rising material costs, and a tightened labor market, especially in northern Indiana. To address these challenges, we have strategically managed working capital, including intentionally building up levels of certain inventory items to avoid future shortages, and have expanded our production capacity. As we reinvest in the business, we also closely monitor our liquidity. In the event additional needs for cash arise, or if we refinance our existing debt, we may raise additional funds from a combination of sources, including the potential issuance of debt or equity securities. Additional financing might not be available on terms favorable to us, or at all.
We believe the availability under the revolving credit facility under the Credit Agreement, along with our cash flows from operations, are adequate to finance our anticipated cash requirements for the next twelve months.

The Condensed Consolidated Statements of Cash Flows reflect the following for the six months ended June 30:

(In thousands)20222021
Net cash flows provided by operating activities$347,971 $23,859 
Net cash flows used in investing activities(120,422)(146,429)
Net cash flows (used in) provided by financing activities(234,390)168,802 
Effect of exchange rate changes on cash and cash equivalents (1,067)(92)
Net (decrease) increase in cash and cash equivalents$(7,908)$46,140 

Cash Flows from Operations
Net cash flows provided by operating activities were $348.0 million in the first six months of 2022, compared to $23.9 million in the first six months of 2021. The increase in net cash flows provided by operating activities was primarily due to a $208.7 million increase in net income and higher depreciation and amortization. Additionally, the net change in assets and liabilities, net of acquired businesses, generated $107.8 million more cash in the first six months of 2022 compared to the same period in 2021. The primary use of cash in net assets was accounts receivable which increased driven by record sales in the first six months of 2021.
Over the long term, based on our historical collection and payment patterns, as well as inventory turnover, and also giving consideration to emerging trends and changes to the sales mix, we expect working capital to increase or decrease
33

LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
equivalent to approximately 10 to 15 percent of the increase or decrease, respectively, in net sales. However, there are many factors that can impact this relationship, especially in the short term.
Depreciation and amortization was $63.7 million in the first six months of 2022, and is expected to be approximately $130 to $140 million for the full year 2022. Non-cash stock-based compensation expense in the first six months of 2022 was $13.7 million. Non-cash stock-based compensation expense is expected to be approximately $25 to $30 million for the full year 2022.

Cash Flows from Investing Activities
Cash flows used in investing activities of $120.4 million in the first six months of 2022 were primarily comprised of $70.8 million for capital expenditures and $51.8 million for the acquisitions of businesses. Cash flows used in investing activities of $146.4 million in the first six months of 2021 were primarily comprised of $103.9 million for the acquisitions of businesses, net of cash acquired and $42.0 million for capital expenditures.
Our capital expenditures are primarily for replacement and growth, and during the first six months of 2022 included capacity expansions designed to meet elevated demand. Over the long term, based on our historical capital expenditures, the replacement portion of our capital expenditures has averaged approximately one to two percent of net sales, while the growth portion has averaged approximately two to three percent of net sales. However, there are many factors that can impact the actual spending compared to these historical averages. We estimate full year 2022 capital expenditures of $120 to $140 million, including capacity expansions to meet elevated demand, which we expect to fund with cash flows from operations or periodic borrowings under the revolving credit facility as needed.
Capital expenditures and acquisitions in the first six months of 2022 were funded by cash from operations and borrowings under our Credit Agreement. Capital expenditures and acquisitions in the remainder of fiscal year 2022 are expected to be funded primarily from cash generated from operations, as well as periodic borrowings under our revolving credit facility.

Cash Flows from Financing Activities
Cash flows used in financing activities of $234.4 million in the first six months of 2022 were primarily comprised of $107.1 million in net repayments under our revolving credit facility, $60.9 million in repayments under our shelf loan, term loan and other borrowings, payments of quarterly dividends of $49.6 million, and cash outflows of $10.8 million related to vesting of stock-based awards, net of shares tendered for payment of taxes.
Cash flows provided by financing activities of $168.8 million in the first six months of 2021 were primarily comprised of proceeds from the issuance of the Convertible Notes and warrants to purchase 2.8 million shares of the Company's common stock, net of debt issuance costs, and from the privately negotiated call option contracts on the Company's common stock of $396.5 million, partially offset by $165.1 million in net payments under our revolving credit facility, payments of quarterly dividends of $41.7 million, repayments of $8.7 million under the term loan and other borrowings, and cash outflows of $7.9 million related to vesting of stock-based awards, net of shares tendered for payment of taxes.
The Credit Agreement and Shelf-Loan Facility include both financial and non-financial covenants. The covenants dictate that we shall not permit our net leverage ratio to exceed certain limits, shall maintain a minimum debt service coverage ratio, and must meet certain other financial requirements. At June 30, 2022, we were in compliance with all such requirements, and we expect to remain in compliance for the next twelve months.
We have paid regular quarterly dividends since 2016. Future dividend policy with respect to our common stock will be determined by our Board of Directors in light of our prevailing financial needs, earnings, and other relevant factors, including any limitations in our debt agreements, such as maintenance of certain financial ratios.

CORPORATE GOVERNANCE

We are in compliance with the corporate governance requirements of the Securities and Exchange Commission (“SEC”) and the New York Stock Exchange. Our governance documents and committee charters and key practices have been posted to the “Investors” section of our website (www.lci1.com) and are updated periodically. The website also contains, or provides direct links to, all SEC filings, press releases and investor presentations. We have also established a Whistleblower Policy, which includes a toll-free hotline (877-373-9123) to report complaints about our accounting, internal controls, auditing
34

LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
matters or other concerns. The Whistleblower Policy and procedure for complaints can be found on our website (www.lci1.com).

CONTINGENCIES

Information required by this item is included in Note 11 of the Notes to Condensed Consolidated Financial Statements and is incorporated herein by reference.

INFLATION

The prices of key raw materials, consisting primarily of steel and aluminum, and components used by us which are made from these raw materials, are influenced by demand and other factors specific to these commodities, as well as by inflationary pressures. We experienced elevated prices of these commodities in the first six months of 2022, and we expect commodity prices to remain elevated in the near term. Prices of these commodities have historically been volatile, and over the past few months prices have continued to fluctuate. Please see "Results of Operations" above for additional information regarding the impact of raw material costs on our results of operations for the first six months of 2022.

As a result of the competitive labor market and strong demand for our products, we experienced increased labor costs in the first six months of 2022 attributable to higher wages and increased overtime and additional shifts for our team members. We expect some relief in labor costs in the near term as dealer inventory levels have balanced, which we project will reduce overtime and temporary staffing spend. Please see "Results of Operations" above for additional information regarding the impact of labor costs on our results of operations for the first six months of 2022.

NEW ACCOUNTING PRONOUNCEMENTS

Information required by this item is included in Note 2 of the Notes to Condensed Consolidated Financial Statements.

USE OF ESTIMATES

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, net sales and expenses, and related disclosure of contingent assets and liabilities. On an ongoing basis, we evaluate our estimates, including, but not limited to, those related to product returns, sales and purchase rebates, accounts receivable, inventories, goodwill and other intangible assets, net assets of acquired businesses, income taxes, warranty and product recall obligations, self-insurance obligations, operating lease right-of-use assets and obligations, asset retirement obligations, long-lived assets, pension and post-retirement benefits, stock-based compensation, segment allocations, contingent consideration, environmental liabilities, contingencies and litigation. We base our estimates on historical experience, other available information and various other assumptions believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities not readily apparent from other resources. Actual results and events could differ significantly from management estimates.

FORWARD-LOOKING STATEMENTS

This Form 10-Q contains certain "forward-looking statements" with respect to our financial condition, results of operations, business strategies, operating efficiencies or synergies, competitive position, growth opportunities, acquisitions, plans and objectives of management, markets for the Company's common stock, the impact of legal proceedings, and other matters. Statements in this Form 10-Q that are not historical facts are "forward-looking statements" for the purpose of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and Section 27A of the Securities Act of 1933, as amended, and involve a number of risks and uncertainties.

Forward-looking statements, including, without limitation, those relating to the Company's future business prospects, net sales, expenses and income (loss), capital expenditures, tax rate, cash flow, financial condition, liquidity, covenant compliance, retail and wholesale demand, integration of acquisitions, R&D investments, and industry trends, whenever they occur in this Form 10-Q are necessarily estimates reflecting the best judgment of the Company's senior management at the time such statements were made. There are a number of factors, many of which are beyond the Company’s control, which could cause actual results and events to differ materially from those described in the forward-looking statements. These factors
35

LCI INDUSTRIES
ITEM 2 – MANAGEMENT’S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
include, in addition to other matters described in this Form 10-Q, the impacts of COVID-19, or other future pandemics, and the Russia-Ukraine War on the global economy and on the Company's customers, suppliers, employees, business and cash flows, pricing pressures due to domestic and foreign competition, costs and availability of, and tariffs on, raw materials (particularly steel and aluminum) and other components, seasonality and cyclicality in the industries to which we sell our products, availability of credit for financing the retail and wholesale purchase of products for which we sell our components, inventory levels of retail dealers and manufacturers, availability of transportation for products for which we sell our components, the financial condition of our customers, the financial condition of retail dealers of products for which we sell our components, retention and concentration of significant customers, the costs, pace of and successful integration of acquisitions and other growth initiatives, availability and costs of production facilities and labor, team member benefits, team member retention, realization and impact of expansion plans, efficiency improvements and cost reductions, the disruption of business resulting from natural disasters or other unforeseen events, the successful entry into new markets, the costs of compliance with environmental laws, laws of foreign jurisdictions in which we operate, other operational and financial risks related to conducting business internationally, and increased governmental regulation and oversight, information technology performance and security, the ability to protect intellectual property, warranty and product liability claims or product recalls, interest rates, oil and gasoline prices, and availability, the impact of international, national and regional economic conditions and consumer confidence on the retail sale of products for which we sell our components, and other risks and uncertainties discussed more fully under the caption "Risk Factors" in the Company's Annual Report on Form 10-K for the year ended December 31, 2021, and in the Company's subsequent filings with the SEC, including the Company's Quarterly Reports on Form 10-Q. Readers of this report are cautioned not to place undue reliance on these forward-looking statements, since there can be no assurance that these forward-looking statements will prove to be accurate. The Company disclaims any obligation or undertaking to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made, except as required by law.
36


LCI INDUSTRIES
ITEM 3 – QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK
We are exposed to market risk related to changes in short-term interest rates on our variable rate debt. Depending on the interest rate option selected as more fully described in Note 9 of the Notes to Condensed Consolidated Financial Statements, interest is charged based on an indexed rate plus an applicable margin. Assuming a hypothetical increase of 0.25 percent in the indexed interest rate (which approximates a 13 percent increase of the weighted-average interest rate on our borrowings as of June 30, 2022), our results of operations would not be materially affected.
We are also exposed to changes in the prices of raw materials, specifically steel and aluminum. We have, from time to time, entered into derivative instruments for the purpose of managing a portion of the exposures associated with fluctuations in steel and aluminum prices. While these derivative instruments are subject to fluctuations in value, these fluctuations are generally offset by the changes in fair value of the underlying exposures. We had no outstanding derivative instruments on commodities at June 30, 2022 and December 31, 2021.
We have historically been able to obtain sales price increases to partially offset the majority of raw material cost increases. However, there can be no assurance future cost increases, if any, can be partially or fully passed on to customers, or that the timing of such sales price increases will match raw material cost increases.
Additional information required by this item is included under the caption "Inflation" in the Management's Discussion and Analysis of Financial Condition and Results of Operations section of this report.

ITEM 4 – CONTROLS AND PROCEDURES
a.Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is (i) recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and (ii) accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure, in accordance with the definition of "disclosure controls and procedures" in Rule 13a-15(e) under the Exchange Act. In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, cannot provide absolute assurance of achieving the desired control objectives. Management included in its evaluation the cost-benefit relationship of possible controls and procedures. We continually evaluate our disclosure controls and procedures to determine if changes are appropriate based upon changes in our operations or the business environment in which we operate.
As of the end of the period covered by this Form 10-Q, we performed an evaluation, under the supervision and with the participation of our management, including our principal executive officer and our principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of June 30, 2022.
b.Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting during the quarter ended June 30, 2022, which have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
37


LCI INDUSTRIES

PART II – OTHER INFORMATION

ITEM 1 – LEGAL PROCEEDINGS
In the normal course of business, we are subject to proceedings, lawsuits, regulatory agency inquiries and other claims. All such matters are subject to uncertainties and outcomes that are not predictable with assurance. While these matters could materially affect operating results when resolved in future periods, it is management’s opinion that after final disposition, including anticipated insurance recoveries in certain cases, any monetary liability or financial impact to the Company beyond that provided in the Condensed Consolidated Balance Sheet as of June 30, 2022, would not be material to our financial position or results of operations.

ITEM 1A – RISK FACTORS

There have been no material changes to the matters discussed in Part I, Item 1A – Risk Factors in our Annual Report on Form 10-K as filed with the SEC on February 25, 2022.

ITEM 6 – EXHIBITS

a)    Exhibits as required by item 601 of Regulation S-K:

1LCI Industries Restated Certificate of Incorporation, as amended effective December 30, 2016 (incorporated by reference to Exhibit 3.1 included in the Registrant’s Form 10-K for the year ended December 31, 2016).
2Amended and Restated Bylaws of LCI Industries, as amended May 25, 2017 (incorporated by reference to Exhibit 3.2 included in the Registrant’s Form 8-K filed on May 31, 2017).
3Form of Restricted Stock Unit Award Agreement (Executives) under the LCI Industries 2018 Omnibus Incentive Plan (Revised 2022)
4Form of Performance Stock Unit Award Agreement under the LCI Industries 2018 Omnibus Incentive Plan (Revised 2022)
5Form of Executive Employment Agreement (Revised 2022)
6Certification of Chief Executive Officer required by Rule 13a-14(a).
7
Certification of Chief Financial Officer required by Rule 13a-14(a).
8
Certification of Chief Executive Officer required by Rule 13a-14(b) and Section 1350 Chapter 63 of Title 18 of the United States Code.
9
Certification of Chief Financial Officer required by Rule 13a-14(b) and Section 1350 Chapter 63 of Title 18 of the United States Code.
10101
The following financial information from the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2022, formatted in Inline XBRL: (i) Condensed Consolidated Statements of Income; (ii) Condensed Consolidated Statements of Comprehensive Income; (iii) Condensed Consolidated Balance Sheets; (iv) Condensed Consolidated Statements of Cash Flows; (v) Condensed Consolidated Statements of Stockholders’ Equity; and (vi) Notes to Condensed Consolidated Financial Statements.
11104Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).



38


LCI INDUSTRIES

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
LCI INDUSTRIES
Registrant
By/s/ Brian M. Hall
Brian M. Hall
Chief Financial Officer
August 2, 2022

39
Exhibit 10.1

LCI INDUSTRIES
2018 OMNIBUS INCENTIVE PLAN
Restricted Stock Unit Award Agreement
    LCI Industries (the “Company”), pursuant to its 2018 Omnibus Incentive Plan (the “Plan”), hereby grants an award of Restricted Stock Units to you, the Participant named below. The terms and conditions of this Award are set forth in this Restricted Stock Unit Award Agreement (the “Agreement”), consisting of this cover page and the Terms and Conditions on the following pages, and in the Plan document, a copy of which has been provided to you. Any capitalized term that is used but not defined in this Agreement shall have the meaning assigned to it in the Plan as it currently exists or as it is amended in the future.
Name of Participant:    [[FIRSTNAME]] [[LASTNAME]]
Number of Restricted Stock Units: [[SHARESGRANTED]]Grant Date:        [[GRANTDATE]]
Vesting Schedule:
Scheduled Vesting Dates
03/01/2023
03/01/2024
03/01/2025
Number of Restricted Stock Units that Vest
33.33%
33.33%
33.33%
By signing below or otherwise evidencing your acceptance of this Agreement in a manner approved by the Company, you agree to all of the terms and conditions contained in this Agreement and in the Plan document. You acknowledge that you have received and reviewed these documents. With respect to this Award, if there is any conflict between the provisions of this Agreement and any other agreement between you and the Company (including any employment agreement), the provisions of this Agreement will govern.
PARTICIPANT:    LCI INDUSTRIES:
[[SIGNATURE]]        By: _______________________________
[[SIGNATURE_DATE]]     Title: _____________________________

US.137065342.05



LCI INDUSTRIES
2018 Omnibus Incentive Plan
Restricted Stock Unit Award Agreement

Terms and Conditions

1.    Grant of Restricted Stock Units. The Company hereby confirms the grant to you, as of the Grant Date and subject to the terms and conditions of this Agreement and the Plan, of the number of Restricted Stock Units specified on the cover page of this Agreement (the “Units”). Each Unit represents the right to receive one Share of the Company’s common stock. Prior to their settlement or forfeiture in accordance with the terms of this Agreement, the Units granted to you will be credited to an account in your name maintained by the Company. This account shall be unfunded and maintained for book-keeping purposes only, with the Units simply representing an unfunded and unsecured contingent obligation of the Company.

2.    Restrictions Applicable to Units. Neither this Award nor the Units subject to this Award may be sold, assigned, transferred, exchanged or encumbered, voluntarily or involuntarily, other than a transfer upon your death in accordance with your will, by the laws of descent and distribution or pursuant to a beneficiary designation submitted in accordance with Section 6(d) of the Plan. Following any such transfer, this Award shall continue to be subject to the same terms and conditions that were applicable to this Award immediately prior to its transfer. Any attempted transfer in violation of this Section 2 shall be void and without effect. The Units and your right to receive Shares in settlement of the Units under this Agreement shall be subject to forfeiture as provided in Section 5 until satisfaction of the vesting conditions set forth in Section 4.

3.    No Shareholder Rights. The Units subject to this Award do not entitle you to any rights of a holder of the Company’s common stock. You will not have any of the rights of a shareholder of the Company in connection with the grant of Units subject to this Agreement unless and until Shares are issued to you upon settlement of the Units as provided in Section 6.
4.    Vesting of Units. For purposes of this Agreement, “Vesting Date” means any date, including the Scheduled Vesting Dates specified in the Vesting Schedule on the cover page of this Agreement, on which Units subject to this Agreement vest as provided in this Section 4. Notwithstanding the vesting and subsequent settlement of this Award, it shall remain subject to the provisions of Section 9 of this Agreement.

(a)Scheduled Vesting. If you remain a Service Provider continuously from the Grant Date specified on the cover page of this Agreement, then the Units will vest in the amounts and on the Scheduled Vesting Dates specified in the Vesting Schedule.

(b)Accelerated or Continued Vesting. The vesting of outstanding Units will be accelerated or continued under the circumstances provided below:

(1)Death or Disability. If your Service terminates prior to the final Scheduled Vesting Date due to your death or Disability, then all of the unvested Units shall vest as of such termination date.

(2)Retirement. If your Service terminates prior to the final Scheduled Vesting Date due to your Approved Retirement (as defined in Section 10 below), then all of the unvested Units shall vest as of such termination date, except that no unvested Units shall vest pursuant to this Section 4(b)(2) if less than one year has elapsed from the Grant Date to the date of termination of Service.

(3)Termination without Cause or for Good Reason. If your Service terminates prior to the final Scheduled Vesting Date due to your termination by the Company without Cause, or is

Executive RSU Agreement (2018 Omnibus Incentive Plan)        Page 2
US.137065342.05



terminated by you for Good Reason (as defined in Section 10 below) (excluding any such termination or resignation in connection with a Change in Control as described in Section 4(b)(4) below), then all of the unvested Units shall vest as of such termination date, except that no unvested Units shall vest pursuant to this Section 4(b)(3) if less than one year has elapsed from the Grant Date to the date of termination of Service.

(4)Change in Control. If a Change in Control occurs while you continue to be a Service Provider and prior to the final Scheduled Vesting Date, the following provisions shall apply:

(i)If, within twenty-four (24) months after a Change in Control (A) described in paragraphs (1) or (2) of Section 2(g) of the Plan or (B) that constitutes a Corporate Transaction as defined in paragraph (3) of Section 2(g) of the Plan and in connection with which the surviving or successor entity (or its Parent) has continued, assumed or replaced this Award, you experience an involuntary termination of Service for reasons other than Cause or you terminate your Service for Good Reason, then all unvested Units shall immediately vest in full as of such termination date.

(ii)If this Award is not continued, assumed or replaced in connection with a Change in Control that constitutes a Corporate Transaction, then all unvested Units shall vest in full immediately prior to the effective time of the Corporate Transaction.

(iii)For purposes of this Section 4(b)(4), this Award will be considered assumed or replaced under the circumstances specified in Section 12(b)(1) of the Plan.

5.    Effect of Termination of Service. Except as otherwise provided in accordance with Section 4(b) above, if you cease to be a Service Provider, you will forfeit all unvested Units.

6.    Settlement of Units. Subject to Section 9 below, after any Units vest pursuant to Section 4, the Company shall, as soon as practicable (but no later than the 15th day of the third calendar month following the Vesting Date), cause to be issued and delivered to you (or to your personal representative or your designated beneficiary or estate in the event of your death, as applicable) one Share in payment and settlement of each vested Unit. Delivery of the Shares shall be effected by the issuance of a stock certificate to you, by an appropriate entry in the stock register maintained by the Company’s transfer agent with a notice of issuance provided to you, or by the electronic delivery of the Shares to a brokerage account, and shall be subject to the tax withholding provisions of Section 8 and compliance with all applicable legal requirements as provided in Section 17(c) of the Plan, and shall be in complete satisfaction and settlement of such vested Units. The Company will pay any original issue or transfer taxes with respect to the issue and transfer of Shares to you pursuant to this Agreement, and all fees and expenses incurred by it in connection therewith. If the Units that vest include a fractional Unit, the Company shall round the number of vested Units to the nearest whole Unit prior to issuance of Shares as provided herein.

7.    Dividend Equivalents. If the Company pays cash dividends on its Shares while any Units subject to this Agreement are outstanding, then on each dividend payment date a dividend equivalent dollar amount equal to the number of Units credited to your account pursuant to this Agreement as of the dividend record date times the dollar amount of the cash dividend per Share shall be deemed reinvested in additional Units as of the dividend payment date and such additional Units shall be credited to your account. The number of additional Units so credited shall be determined based on the Fair Market Value of a Share on the applicable dividend payment date. Any additional Units so credited will be subject to the same terms and conditions, including the timing of vesting and settlement, applicable to the underlying Units to which the dividend equivalents relate.

8.    Tax Consequences and Withholding. No Shares will be delivered to you in settlement of vested Units unless you have made arrangements acceptable to the Company for payment of any federal, state, local or foreign withholding taxes that may be due as a result of the delivery of the Shares. You hereby authorize the Company (or any Affiliate) to withhold from payroll or other amounts payable to you any sums required to satisfy such withholding tax obligations, and otherwise agree to satisfy such

Executive RSU Agreement (2018 Omnibus Incentive Plan)        Page 3
US.137065342.05



obligations in accordance with the provisions of Section 14 of the Plan. You may elect to satisfy such withholding tax obligations by having the Company withhold a number of Shares that would otherwise be issued to you in settlement of the Units and that have a Fair Market Value equal to the amount of such withholding tax obligations by notifying the Company of such election.
9.    Forfeiture of Award and Compensation Recovery.
(a)    Financial Restatements. In the event of a restatement of the Company’s financial statements, the Committee shall have the right to review this Award, the amount, payment or vesting of which was based on an entry in the financial statements that is the subject of the restatement. If the Committee determines, based on the results of the restatement, that a lesser amount or portion of this Award should have been paid or vested, it may (i) cancel all or any portion of this Award and (ii) require you or any other person to whom any payment has been made or shares or other property have been transferred in connection with this Award to forfeit and pay over to the Company, on demand, all or any portion of the value realized (whether or not taxable) on the vesting or payment of this Award.
(b)    Forfeiture Conditions. Notwithstanding anything to the contrary in this Agreement, (i) if your Service is terminated for Cause, (ii) if the Committee determines that the payment of the Award was based on an incorrect determination that financial or other criteria were met, (iii) if you breach any of the covenants or provisions described in Section 9(c) below unless compliance with the applicable portion of such covenants has been waived in writing by the Committee in its discretion, or (iv) if you breach any other agreement between you and the Company, including, without limitation, any employment agreement, then, in the discretion of the Committee: (A) any unsettled portion of this Award may be reduced, cancelled or forfeited, and (B) any settled portion of this Award may be rescinded and recovered within one (1) year after the Company becomes aware of such activity, conduct or event. The Company shall notify you in writing of any such reduction, cancellation, forfeiture, rescission or recovery. Immediately after receiving such notice, you shall forfeit this Award as well as the right to receive Shares that have not yet been issued pursuant to Section 6 to the extent indicated therein. If the written notice mandates the rescission or recovery of any settled portion of this Award, then within ten (10) days of the date of such notice, you are required to (y) return to the Company the number of Shares that you received upon settlement of this Award which have not been sold and (z) pay to the Company in cash an amount equal to the Fair Market Value of such Shares as of the respective settlement dates of the underlying Units (with respect to Shares received hereunder that you previously sold). The Company also shall be entitled to set-off against the amount of any such gain any amount owed to you by the Company.
(c)    Restrictive Covenants.

(1)    Non-Disclosure and Return of Confidential Information. You have or will be given access to and provided trade secrets, confidential and proprietary information, and other non-public information and data of or about the Company (and its Affiliates) and its business (“Confidential Information”) in the course of your Service which is of unique value to the Company. Examples of Confidential Information include, without limitation, hard copy or electronically stored information, documents or records including any sensitive, confidential, proprietary, or trade secret information related to: confidential business or manufacturing processes; research and development information; inventions, improvements and designs; new product or marketing plans; business strategies and plans; merger and acquisition targets; financial and pricing information; computer programs, source codes, models and databases; analytical models; human resources strategies; the skills and compensation of the Company’s (and its Affiliates’) employees, contractors, and any other service providers of the Company (or its Affiliates); customer lists and information; information received from or about third parties that the Company is obligated to keep confidential; supplier and vendor lists; the existence or content of any business discussions, negotiations, or agreements between the Company (or any of its Affiliates) and any Customer or Restricted Prospective Customer, or any other third party; and other information which is not generally available to the public. You agree not to disclose, publish or use Confidential Information, either during or after your Service is terminated, except (i) as necessary to perform your duties during your term of Service, (ii) as the Company may consent in writing, (iii) as required by law or judicial process, provided you (unless prohibited by

Executive RSU Agreement (2018 Omnibus Incentive Plan)        Page 4
US.137065342.05



applicable law) promptly notify the Company in writing of any subpoena or other judicial request for disclosure involving Confidential Information or trade secrets, and reasonably cooperate with any effort by the Company to obtain a protective order preserving the confidentiality of the Confidential Information or trade secrets, or (iv) in connection with reporting possible violations of law or regulations to any governmental agency or from making other disclosures protected under any applicable whistleblower laws. The confidentiality obligations set forth herein shall continue indefinitely, for so long as the Confidential Information remains confidential (and you understand that you will not be relieved of your obligations if the Confidential Information loses its confidential nature because of a breach of any of your obligations to the Company or its Affiliates). If this Agreement is enforced by a court applying the law of a jurisdiction where a time frame is required for a non-disclosure provision to be enforceable with respect to information that does not rise to the level of a trade secret, then your obligations with respect to such information will be in effect during your term of Service and for three (3) years thereafter. You further agree to return any and all Confidential Information, whether in hard or electronic format, regardless of the location on which such information may reside, no later than three (3) business days following the termination of your Service or at any other time at the Company’s request. You understand that access or use of the Company’s electronic databases, computer network and electronically stored information is for the Company’s benefit only and that any use of the Company’s electronic databases, computer network or electronically stored information or removal or use of information from the Company’s electronic databases, computer network or other electronically stored information for any other purpose is unauthorized or prohibited. Notwithstanding anything to the contrary herein or in any policy of the Company, you may not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made (A) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney if such disclosure is made solely for the purpose of reporting or investigating a suspected violation of law or for pursuing an anti-retaliation lawsuit; or (B) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal and you do not disclose the trade secret except pursuant to a court order. In the event a disclosure is made, and you file a lawsuit against the Company alleging that the Company retaliated against you because of your disclosure, you may disclose the relevant trade secret or confidential information to your attorney and may use the same in the court proceeding only if (x) you ensure that any court filing that includes the trade secret or confidential information at issue is made under seal; and (y) you do not otherwise disclose the trade secret or confidential information except as required by court order.

(2)    No Solicitation of or Competitive Business with Customers. During the Restricted Period, you shall not, directly or indirectly, (i) provide, sell, market, attempt to provide, sell or market, or assist any person or entity in the provision, sale or marketing of any Competitive Product to any Customer with respect to whom, at any time during the twenty-four (24) months immediately preceding the termination of your Service, you sold, provided, or assisted in or supervised the sale or provision of, any products or services on behalf of the Company (or an Affiliate), you designed, developed or manufactured, or assisted in or supervised the design, development or manufacture of any product on behalf of the Company (or an Affiliate), you had any business contact on behalf of the Company (or an Affiliate), you had any relationship, business development, sales, service or account responsibility (including, without limitation, any supervisory or managerial responsibility) on behalf of the Company (or an Affiliate), or you had access to, or gained knowledge of, any Confidential Information concerning the Company’s (or an Affiliate’s) business with such Customer, or (ii) otherwise solicit or communicate with any such Customer for the purpose of selling or providing any Competitive Product. For avoidance of doubt, the foregoing covenant prohibits, among other things, you from being employed or engaged by or providing Competitive Services to any Customer in any manner in which you will be developing, producing, providing, or managing the development, production or provision of, any Competitive Product to or for the benefit of such Customer if such Competitive Product displaces, diminishes the need for, or serves as a substitute for, any products that the Company or any of its Affiliates provided, or could provide, to such Customer.

(3)    No Solicitation of or Competitive Business with Restricted Prospective Customers. During the Restricted Period, you shall not, directly or indirectly, (i) provide, sell,

Executive RSU Agreement (2018 Omnibus Incentive Plan)        Page 5
US.137065342.05



market, attempt to provide, sell or market, or assist any person or entity in the provision, sale or marketing of any Competitive Product to any Restricted Prospective Customer or (ii) otherwise solicit or communicate with any Restricted Prospective Customer for the purpose of selling or providing any Competitive Product. For avoidance of doubt, the foregoing covenant prohibits, among other things, you from being employed or engaged by or providing Competitive Services to any Restricted Prospective Customer in any manner in which you will be developing, producing, providing, or managing the development, production or provision of, any Competitive Product to or for the benefit of the Restricted Prospective Customer if such Competitive Product displaces, diminishes the need for, or serves as a substitute for, any product that the Company or any of its Affiliates provided, or could provide, to such Restricted Prospective Customer.

(4)    No Hire. During the Restricted Period, you shall not, directly or indirectly: (i) solicit, recruit, hire, employ, engage the services of or attempt to hire, employ or engage the services of any individual who is an employee or contractor of the Company or an Affiliate (or who was, within the six (6) months prior to the termination of your Service, an employee or contractor of the Company or an Affiliate); (ii) assist any person or entity in the recruitment, hiring or engagement of any individual who is an employee or contractor of the Company or an Affiliate (or who was, within the six (6) months prior to the termination of your Service, an employee or contractor of the Company or an Affiliate); (iii) urge, induce or seek to induce any individual to terminate his/her employment or engagement with the Company or an Affiliate; or (iv) advise, suggest to or recommend to any Competitor or other entity with which you are employed or otherwise associated that it employ, engage the services of or seek to employ or engage the services of any individual who is an employee or contractor of the Company or an Affiliate (or who was, within the six (6) months prior to the termination of your Service, an employee or contractor of the Company or an Affiliate).

(5)    No Competition. During the Restricted Period, you shall not, directly or indirectly, on your own behalf or on behalf of any person or entity other than the Company or an Affiliate, including as a proprietor, principal, agent, partner, officer, director, shareholder, employee, member of any association, consultant or otherwise, perform Competitive Services in the Restricted Area for or on behalf of any Competitor, with respect to Competitive Products.

(6)    Non-Disparagement. During your term of Service and afterward, you shall not, directly or indirectly, criticize, make any negative comments about or otherwise disparage the Company, its Affiliates or any persons or entities associated with any of them, whether orally, in writing, electronically or otherwise, directly or by implication, to any person or entity, including Company customers or agents; provided, however, that nothing in this Section 9(c)(6) is intended to prohibit you from (i) making any disclosures or statements in good faith in the normal course of performing your duties or responsibilities for the Company during your Service; (ii) making any disclosures as may be required or compelled by law or legal process; or (iii) making any disclosures or providing any information to a governmental agency or entity, including without limitation in connection with a complaint by you against the Company or the investigation of any complaint against the Company.

(7)    No Injurious, Detrimental or Prejudicial Conduct. Except as otherwise permitted in Section 9(c)(6), during your term of Service or afterward, you shall not, directly or indirectly, engage in any conduct or inaction, or omit to take any action, which conduct, action or inaction is reasonably determined by the Committee to be injurious, detrimental or prejudicial to the business or reputation of the Company or its Affiliates or any interest of the Company and its Affiliates, including, but not limited to, a violation of any material Company or Affiliate policy or a violation of any federal or state securities laws, rules or regulations or of any rule or other requirement of any securities exchanges on which the Company’s Shares may, at the time, be listed.

(d)    Compensation Recovery Policy. In addition to those provisions in Sections 9(a), 9(b) and 9(c), to the extent that this Award and any compensation associated therewith is considered “incentive-based compensation” within the meaning and subject to the requirements of Section 10D of the Exchange Act, this Award and any compensation associated therewith shall be subject to potential forfeiture or

Executive RSU Agreement (2018 Omnibus Incentive Plan)        Page 6
US.137065342.05



recovery by the Company in accordance with any compensation recovery policy adopted by the Board or the Committee in response to the requirements of Section 10D of the Exchange Act and any implementing rules and regulations thereunder, or as otherwise required by law.  This Agreement may be unilaterally amended by the Committee to comply with any such compensation recovery policy. 

(e)    Remedies. The parties expressly agree that the forfeiture and repayment obligations contained in this Section 9 are in addition to, and not in lieu of, any and all other legal and/or equitable remedies, including without limitation, injunctive relief, that may be available to the Company in connection with your breach of Section 9(c), and the Company reserves it rights to pursue all such remedies.  You acknowledge and agree that your breach of Section 9(c) will cause irreparable injury to the Company and that money damages will not be adequate relief for such injury and, accordingly, you agree that the Company shall be entitled to obtain equitable relief, including, but not limited to, temporary restraining orders, preliminary injunctions and/or permanent injunctions, without having to post any bond or other security, to restrain or enjoin such breach, in addition to all other remedies which may be available to the Company.

10.    Definitions.
(a)    Affiliate. “Affiliate” means any entity that directly, or indirectly through one or more intermediaries, is owned or controlled by, owns or controls, or is under common ownership or control with, the Company; for this purpose, “control” of an entity means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of the entity, whether through the ownership of voting securities, by contract or otherwise.
(b)    Approved Retirement. “Approved Retirement” means any voluntary termination of employment on or after the date on which the sum of your age and years of employment with the Company or its Affiliates equals at least sixty-five (65) with the approval of the Committee, or any other termination of employment that the Committee determines to qualify as an Approved Retirement.
(c)    Competitive Products. “Competitive Products” are products and/or services that are the same as or substantially similar to (in terms of type, brand or purpose) the products and/or services offered by the Company or its Affiliates in its business, including but not limited to products: (i) regarding which you performed any services for the Company or its Affiliates at any time during the twenty-four (24) month period immediately preceding the termination of your Service; and/or (ii) about which you had access to any Confidential Information at any time during the twenty-four (24) month period immediately preceding the termination of your Service.
(d)    Competitive Services. “Competitive Services” means services that are the same as or substantially similar to (in terms of type or purpose) the services you performed for or on behalf of the Company or its Affiliates at any time during the twenty-four (24) month period immediately preceding the termination of your Service.
(e)    Competitor. “Competitor” means any individual or entity (including a Customer) that engages in the business (in whole or in any part) of the Company or its Affiliates, and which manufactures, markets, sells or distributes products and/or services that are the same as or substantially similar to (in terms of type, brand or purpose) the products and/or services manufactured, marketed, sold or distributed by the Company or its Affiliates in its business, as of the date on which your Service terminates.
(f)    Customer. “Customer” means any individual or entity as to which, with or to whom, within the twenty-four (24) month period immediately preceding the termination of your Service: (i) any products or services were provided by the Company, or (ii) any contract was entered into with the Company for the provision of any products or services.
(g)    Good Reason. “Good Reason” means the existence of one or more of the following conditions without your written consent, so long as you provided written notice to the Company of the existence of the condition not later than 90 days after the initial existence of the condition, the condition has not been remedied by the Company within 30 days after its receipt of such notice and you terminate

Executive RSU Agreement (2018 Omnibus Incentive Plan)        Page 7
US.137065342.05



your Service no later than 130 days after the condition’s initial occurrence: (i) a material reduction in your base salary other than in connection with a general reduction affecting a group of employees; (ii) a relocation of your primary work location by more than 100 miles; or (iii) any material reduction in your authority, duties or responsibilities.
(h)    Restricted Area. Because of the nature of the Company’s business and the nature of your duties and responsibilities for the Company, your obligations under Section 9(c)(5) shall apply in each of the following geographic areas, which shall collectively be defined as the “Restricted Area”: (i) the State of Indiana; (ii) Elkhart County, Indiana, and the contiguous counties thereto (including the contiguous counties in the State of Michigan); and (iii) the area(s) within a 100 mile radius of any office, facility and/or manufacturing operation of the Company (or of any Affiliate) to which you were assigned to work or report, at which you worked or performed services or for which you were responsible, in whole or in part, for managing for or on behalf of the Company (or any Affiliate) as of the termination of your Service or at any time during the twenty-four (24) months immediately preceding the termination of your Service.
(i)    Restricted Period. “Restricted Period” means during the term of your Service and for the twelve (12) month period immediately after the termination of your Service, regardless whether such termination was voluntary or involuntary.
(j)    Restricted Prospective Customer. “Restricted Prospective Customer” means: (i) any person or entity whom you, on behalf of the Company (or any Affiliate), solicited, assisted in the solicitation of, or engaged in marketing, sales or business development efforts towards, at any time during the twelve (12) months immediately preceding the termination of your Service; and/or (ii) any person or entity to whom the Company (or any Affiliate) submitted a quotation, bid or sales proposal at any time during the twelve (12) months immediately preceding the termination of your Service if you were involved in or aware of such quotation, bid or sales proposal during your Service.
11.    Notices. Every notice or other communication relating to this Agreement shall be in writing and shall be mailed to or delivered (including electronically) to the party for whom it is intended at such address as may from time to time be designated by it in a notice mailed or delivered to the other party as herein provided. Unless and until some other address is so designated, all notices or communications by you to the Company shall be mailed or delivered to the Company, to the attention of its Vice President- Chief Legal Officer at the Company’s offices located at 4100 Edison Lakes Pkwy, Suite 210, Mishawaka, IN 46545, legal@lci1.com. All notices or communications by the Company to you may be given to you personally or may be mailed or, if you are still a Service Provider, emailed to you at the address indicated in the Company’s records as your most recent mailing or email address.

12.    Additional Provisions.
(a)    Standing. The Company’s Affiliates are intended third-party beneficiaries of this Agreement and this Agreement may be enforced by the Company and/or its Affiliates, either singularly or jointly.

(b)    No Right to Continued Service. This Agreement does not give you a right to continued Service with the Company or any Affiliate, and the Company or any such Affiliate may terminate your Service at any time and otherwise deal with you without regard to the effect it may have upon you under this Agreement.

(c)    Governing Plan Document. This Agreement and the Award are subject to all the provisions of the Plan, and to all interpretations, rules and regulations which may, from time to time, be adopted and promulgated by the Committee pursuant to the Plan. If there is any conflict between the provisions of this Agreement and the Plan, the provisions of the Plan will govern.

(d)    Governing Law; Venue; Waiver of Jury Trial.  To the extent not pre-empted by federal law, this Agreement, the parties’ performance hereunder, and the relationship between them shall be governed by, construed, and enforced in accordance with the laws of the State of Delaware, without giving effect to the choice of law principles thereof. Each party hereto agrees that any legal action arising

Executive RSU Agreement (2018 Omnibus Incentive Plan)        Page 8
US.137065342.05



out of or relating to this Agreement shall be commenced and maintained exclusively before any state or federal court having appropriate subject matter jurisdiction located in St. Joseph County, Indiana. Further, each party hereto irrevocably consents and submits to the personal jurisdiction and venue of such courts located in St. Joseph County, Indiana, and waives any right to challenge or otherwise object to personal jurisdiction or venue (including, without limitation, any objection based on inconvenient forum grounds) in any action commenced or maintained in such courts located in St. Joseph County, Indiana; provided, however, the foregoing shall not affect any applicable right a party may have to remove a legal action to federal court. EACH PARTY HERETO VOLUNTARILY AND IRREVOCABLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT.

(e)    Severability. The provisions of this Agreement shall be severable and if any provision of this Agreement is found by any court to be unenforceable, in whole or in part, the remainder of this Agreement shall nevertheless be enforceable and binding on the parties. You also agree that any trier of fact may modify any invalid, overbroad or unenforceable provision of this Agreement so that such provision, as modified, is valid and enforceable under applicable law.

(f)    Independent Covenants. To the extent you are or become subject to any other agreements with the Company or any Affiliate that contain restrictive covenants, including, but not limited to, any employment agreement, non-competition agreement, non-disclosure agreement or non-solicitation agreement, the restrictive covenants set forth in Section 9 of this Agreement are independent of, supplement and do not supersede such other agreements.

(g)    Binding Effect. This Agreement will be binding in all respects on your heirs, representatives, successors and assigns, and on the successors and assigns of the Company.

(h)    Section 409A of the Code. The award of Units as provided in this Agreement and any issuance of Shares or payment pursuant to this Agreement are intended to be exempt from Section 409A of the Code under the short-term deferral exception specified in Treas. Reg. § 1.409A-l(b)(4).

(i)    Electronic Delivery and Acceptance. The Company may deliver any documents related to this Award by electronic means and request your acceptance of this Agreement by electronic means. You hereby consent to receive all applicable documentation by electronic delivery and to participate in the Plan through an on-line (and/or voice activated) system established and maintained by the Company or the Company’s third-party stock plan administrator.

By signing the cover page of this Agreement or otherwise accepting this Agreement in a manner approved by the Company, you agree to all the terms and conditions described above and in the Plan document.



Executive RSU Agreement (2018 Omnibus Incentive Plan)        Page 9
US.137065342.05



BENEFICIARY DESIGNATION


I, [[FIRSTNAME]] [[LASTNAME]], designate the Beneficiary(ies) below to exercise any Award or receive a payment under an Award that is exercisable or payable on or after my death, subject to the terms and conditions of the applicable Award agreement and the LCI Industries 2018 Omnibus Incentive Plan. This beneficiary designation shall remain in place until such time as I submit a new beneficiary designation form to LCI Industries. This beneficiary designation shall also apply to all prior awards granted under LCI Industries’ previous equity plans.
PRIMARY BENEFICIARY(IES)


Name
Percentage of
   Benefits  

Relationship
Social Security
   Number   
_____________________
_____________________
_______
_______
__________
__________
________________
________________
CONTINGENT BENEFICIARIES (Will receive indicated portions of my Award(s) referred to herein if
     no Primary Beneficiaries survive me)


Name
Percentage of
   Benefits  

Relationship
Social Security
   Number   
______________________________________________________
______________________________________________________
______________________________________________________

                                                
    Signature of Participant                        Date



Executive RSU Agreement (2018 Omnibus Incentive Plan)        Page 10
US.137065342.05

EXHIBIT 10.2
LCI INDUSTRIES
2018 OMNIBUS INCENTIVE PLAN

Performance Stock Unit Award Agreement

LCI Industries (the “Company”), pursuant to its 2018 Omnibus Incentive Plan (the “Plan”), hereby grants an award of Performance Stock Units to you, the Participant named below. The terms and conditions of this Award are set forth in this Performance Stock Unit Award Agreement (the “Agreement”), consisting of this cover page, the Terms and Conditions on the following pages and the attached Annex A, and in the Plan document, a copy of which has been provided to you. Any capitalized term that is used but not defined in this Agreement shall have the meaning assigned to it in the Plan as it currently exists or as it is amended in the future.

Name of Participant:[[FIRSTNAME]] [[LASTNAME]]
Target Number of
Performance Stock Units:
[[SHARESGRANTED]]
Grant Date:[[GRANTDATE]]
Measurement Period:January 1, 2022 – December 31, 2024
Scheduled Vesting Date:
The number of Units determined in accordance with Annex A to have been achieved as of the end of the Measurement Period will vest* on March 1, 2025, subject to earlier vesting or termination as provided in the attached Terms and Conditions
Performance Goals:
See Annex A
* Except as set forth in this Agreement, assuming that your Service has been continuous from the Grant Date to the vesting date.


    By signing below or otherwise evidencing your acceptance of this Agreement in a manner approved by the Company, you agree to all of the terms and conditions contained in this Agreement and in the Plan document. You acknowledge that you have received and reviewed these documents. With respect to this Award, if there is any conflict between the provisions of this Agreement and any other agreement between you and the Company (including any employment agreement), the provisions of this Agreement will govern.

PARTICIPANT:    LCI INDUSTRIES:
[[SIGNATURE]]        By:_______________________________
[[SIGNATURE_DATE]]     Title: _____________________________
1


EXHIBIT 10.2
LCI INDUSTRIES
2018 Omnibus Incentive Plan
Performance Stock Unit Award Agreement

Terms and Conditions

1.Award of Performance Stock Units. The Company hereby confirms the grant to you, as of the Grant Date and subject to the terms and conditions of this Agreement and the Plan, of an award of Performance Stock Units (the “Units”) in an amount initially equal to the Target Number of Performance Stock Units specified on the cover page of this Agreement. The number of Units that may actually be achieved and become eligible to vest pursuant to this Award can be between 0% and 200% of the Target Number of Units (excluding any dividend equivalent Units credited to you pursuant to Section 6 below). Each Unit that is determined to be achieved as a result of the performance goals specified in Annex A to this Agreement having been satisfied and which thereafter vests represents the right to receive one Share of the Company’s common stock. Prior to their settlement or forfeiture in accordance with the terms of this Agreement, the Units granted to you will be credited to a performance stock unit account in your name maintained by the Company. This account will be unfunded and maintained for book-keeping purposes only, with the Units simply representing an unfunded and unsecured contingent obligation of the Company.

2.    Restrictions Applicable to Units. Neither this Award nor the Units subject to this Award may be sold, assigned, transferred, exchanged or encumbered, voluntarily or involuntarily, other than a transfer upon your death in accordance with your will, by the laws of descent and distribution or pursuant to a beneficiary designation submitted in accordance with Section 6(d) of the Plan. Following any such transfer, this Award shall continue to be subject to the same terms and conditions that were applicable to this Award immediately prior to its transfer. Any attempted transfer in violation of this Section 2 shall be void and without effect. The Units and your right to receive Shares in settlement of any Units under this Agreement shall be subject to forfeiture except to extent the Units have been achieved and thereafter vest as provided in Section 4.

3.    No Shareholder Rights. The Units subject to this Award do not entitle you to any rights of a holder of the Company’s common stock. You will not have any of the rights of a shareholder of the Company in connection with any Units granted or achieved pursuant to this Agreement unless and until Shares are issued to you in settlement of achieved and vested Units as provided in Section 5.

4.    Vesting and Forfeiture of Units. Subject in all cases to Section 8 of this Agreement, the Units shall vest at the earliest of the following times and to the degree specified.

(a)Determination of Units Achieved; Scheduled Vesting. The Committee will determine (i) the degree to which the applicable performance goals for the Measurement Period have been satisfied, and (ii) the number of Units that have been achieved during the Measurement Period, each as determined in accordance with Annex A, typically following the Measurement Period (and in any event no later than March 10, 2025). The achieved Units, if any, will vest on the earlier of (i) the Scheduled Vesting Date set forth on the cover page of this Agreement, so long as you have provided continuous Service from the Grant Date to the Scheduled Vesting Date, or (ii) the occurrence of an event described in Section 4(b)-(f).

(b)Disability. If your Service terminates by reason of your Disability prior to the Scheduled Vesting Date, then the number of Units deemed achieved and vested shall be determined as follows:

    (i)    if your termination of Service due to Disability occurs before the last day of the Measurement Period, the Target Number of Units, prorated to reflect the portion of the Measurement Period (the “Proration Period”) that had passed prior to the date of the termination of your Service; and
        (ii)    if your termination of Service due to Disability occurs on or after the last day of the Measurement Period, the number of Units will be determined in accordance with Section 4(a) and Annex A hereof based on the actual level of achievement of the performance goals set forth in Annex A.
2


EXHIBIT 10.2
The Units achieved and calculated as set forth above shall be fully vested as of the date of your termination of Service due to Disability.
(c)Death. If you die prior to the Scheduled Vesting Date, then the number of Units deemed achieved and vested shall be determined as follows:

        (i)    if your death occurs before the last day of the Measurement Period, the Target Number of Units, prorated to reflect the portion of the Proration Period that had passed prior to the date of your death; and
        (ii)     if your death occurs on or after the last day of the Measurement Period, the number of Units will be determined in accordance with Section 4(a) and Annex A hereof based on the actual level of achievement of the performance goals set forth in Annex A.
The Units achieved and calculated as set forth above shall be fully vested as of the date of your death.
(d)    Retirement. If your Service terminates by reason of your Approved Retirement (as defined in Section 9):

    (i)    before the last day of the Measurement Period, then the number of Units deemed achieved shall be the number of Units determined in accordance with Section 4(a) and Annex A hereof based on the actual level of achievement of the performance goals set forth in Annex A, prorated to reflect the portion of the Measurement Period from the first day of the Measurement Period through the date of your Approved Retirement, as compared to the length of the Measurement Period, and the Units so achieved shall vest on the Scheduled Vesting Date; or

    (ii)    prior to the Scheduled Vesting Date but on or after the last day of the Measurement Period, then the number of Units deemed achieved and vested shall be determined in accordance with Section 4(a) and Annex A hereof based on the actual level of achievement of the performance goals set forth in Annex A, and the Units so achieved shall vest on the Scheduled Vesting Date.

(e)    Qualifying Termination. If your Service is terminated by the Company without Cause, or is terminated by you for Good Reason (as defined in Section 9 below) (and such termination does not occur within twenty-four (24) months after a Change in Control, which termination is governed by Section 4(f) hereof) (a “Qualifying Termination”) prior to the Scheduled Vesting Date, then the number of Units deemed achieved and vested shall be determined as follows:

(i)    if your termination of Service as a result of a Qualifying Termination occurs before the last day of the Measurement Period, then the number of Units deemed achieved and vested shall be the number of Units determined in accordance with Section 4(a) and Annex A hereof based on the actual level of achievement of the performance goals set forth in Annex A, prorated to reflect the portion of the Measurement Period from the first day of the Measurement Period through the date of the Qualifying Termination, as compared to the length of the Measurement Period, and the Units so achieved shall be fully vested on the Scheduled Vesting Date; and

(ii)    if termination of Service as a result of a Qualifying Termination occurs on or after the last day of the Measurement Period, then the number of Units deemed achieved and vested shall be determined in accordance with Section 4(a) and Annex A hereof based on the actual level of achievement of the performance goals set forth in Annex A, and the Units so achieved shall vest on the Scheduled Vesting Date.

(f)    Change in Control. If a Change in Control occurs while you continue to be a Service Provider and prior to the Scheduled Vesting Date, the following provisions shall apply:
(i)If, within twenty-four (24) months after a Change in Control (A) described in paragraphs (1) or (2) of Section 2(g) of the Plan or (B) that constitutes a Corporate Transaction as defined in paragraph (3) of Section 2(g) of the Plan and in connection with which the surviving or successor entity (or its Parent) has continued, assumed or replaced this Award, you experience an
3


EXHIBIT 10.2
involuntary termination of Service for reasons other than Cause or you terminate your Service for Good Reason, then the Units shall be deemed to have been achieved and vested as of such termination date to the degree and in the manner provided in Section 4(f)(iii).
(ii)If this Award is not continued, assumed or replaced in connection with a Change in Control that constitutes a Corporate Transaction, then the Units shall be deemed to have been achieved and vested immediately prior to the effective time of the Corporate Transaction to the degree and in the manner provided in Section 4(f)(iii).
(iii)The number of Units that would be deemed achieved and vested pursuant to Section 4(f)(i) and Section 4(f)(ii) will be equal to (A) if the accelerated vesting event occurs before the last day of the Measurement Period, the Target Number of Units, prorated to reflect the portion of the Proration Period that had passed prior to the date of the Change in Control or the termination of Service, as applicable, or (B) if the accelerated vesting event occurs on or after the last day of the Measurement Period, the number of Units will be determined in accordance with Section 4(a) and Annex A hereof based on the actual level of achievement of the performance goals set forth in Annex A.
(g)Forfeiture of Unvested Units. Any Units that do not vest on the applicable vesting date as provided in Sections 4(a) through (f) shall immediately be forfeited. If your Service terminates prior to the Scheduled Vesting Date under circumstances other than as set forth in Sections 4(b) through (f), all unvested Units shall immediately be forfeited.

5.    Settlement of Units. Subject to Section 8 below, as soon as practicable after any date on which Units vest (but no later than the 15th day of the third calendar month following the applicable vesting date), the Company shall cause to be issued and delivered to you (or to your personal representative or your designated beneficiary or estate in the event of your death, as applicable) one Share in payment and settlement of each vested Unit. Delivery of the Shares shall be effected by the issuance of a stock certificate to you, by an appropriate entry in the stock register maintained by the Company’s transfer agent with a notice of issuance provided to you, or by the electronic delivery of the Shares to a brokerage account, and shall be subject to the tax withholding provisions of Section 7 and compliance with all applicable legal requirements as provided in Section 17(c) of the Plan, and shall be in complete satisfaction and settlement of such vested Units. The Company will pay any original issue or transfer taxes with respect to the issue and transfer of Shares to you pursuant to this Agreement, and all fees and expenses incurred by it in connection therewith. If the Units that vest include a fractional Unit, the Company shall round the number of vested Units to the nearest whole Unit prior to issuance of Shares as provided herein.

6.    Dividend Equivalents. The following provisions shall apply if the Company pays cash dividends on its Shares while any Units subject to this Agreement are outstanding.

(a)Prior to Scheduled Vesting Date. Prior to the Scheduled Vesting Date, on each dividend payment date, a dividend equivalent dollar amount equal to the Target Number of Units pursuant to this Agreement as of the dividend record date times the dollar amount of the cash dividend per Share shall be deemed reinvested in additional Units as of the dividend payment date and such additional Units shall be credited to your performance stock unit account. The number of additional Units so credited shall be determined based on the Fair Market Value of a Share on the applicable dividend payment date. Any additional Units so credited will be subject to the same terms and conditions, including the timing of vesting and settlement, applicable to the underlying Units to which the dividend equivalents relate.

(b)As of Scheduled Vesting Date. As of the Scheduled Vesting Date, you will be credited with an additional number of Units if and to the extent that your performance stock unit account would have been credited with additional Units under Section 6(a) had the determination of additional Units in Section 6(a) been based on the actual number of Units achieved under this Agreement, as determined by the Committee in accordance with Annex A. The calculation of such additional number of Units pursuant to this Section 6(b) will be determined according to the same formula as set forth in Section 6(a). The additional number of Units credited pursuant to this Section 6(b) will be fully vested and subject to settlement at the same time as the underlying Units as provided in Section 5 above.

4


EXHIBIT 10.2
7.    Tax Consequences and Withholding. No Shares will be delivered to you in settlement of vested Units unless you have made arrangements acceptable to the Company for payment of any federal, state, local or foreign withholding taxes that may be due as a result of the delivery of the Shares. You hereby authorize the Company (or any Affiliate) to withhold from payroll or other amounts payable to you any sums required to satisfy such withholding tax obligations, and otherwise agree to satisfy such obligations in accordance with the provisions of Section 14 of the Plan. You may elect to satisfy such withholding tax obligations by having the Company withhold a number of Shares that would otherwise be issued to you in settlement of the Units and that have a Fair Market Value equal to the amount of such withholding tax obligations by notifying the Company of such election.
8.    Forfeiture of Award and Compensation Recovery.
(a)    Financial Restatements. In the event of a restatement of the Company’s financial statements, the Committee shall have the right to review this Award, the amount, payment or vesting of which was based on an entry in the financial statements that is the subject of the restatement. If the Committee determines, based on the results of the restatement, that a lesser amount or portion of this Award should have been paid or vested, it may (i) cancel all or any portion of this Award and (ii) require you or any other person to whom any payment has been made or shares or other property have been transferred in connection with this Award to forfeit and pay over to the Company, on demand, all or any portion of the value realized (whether or not taxable) on the vesting or payment of this Award.
 
(b)    Forfeiture Conditions. Notwithstanding anything to the contrary in this Agreement, (i) if your Service is terminated for Cause, (ii) if the Committee determines that the payment of the Award was based on an incorrect determination that financial or other criteria were met, (iii) if you breach any of the covenants or provisions described in Section 8(c) below unless compliance with the applicable portion of such covenants has been waived in writing by the Committee in its discretion, or (iv) if you breach any other agreement between you and the Company, including, without limitation, any employment agreement, then, in the discretion of the Committee: (A) any unsettled portion of this Award may be reduced, cancelled or forfeited, and (B) any settled portion of this Award may be rescinded and recovered within one (1) year after the Company becomes aware of such activity, conduct or event. The Company shall notify you in writing of any such reduction, cancellation, forfeiture, rescission or recovery. Immediately after receiving such notice, you shall forfeit this Award as well as the right to receive Shares that have not yet been issued pursuant to Section 5 to the extent indicated therein. If the written notice mandates the rescission or recovery of any settled portion of this Award, then within ten (10) days of the date of such notice, you are required to (y) return to the Company the number of Shares that you received upon settlement of this Award which have not been sold and (z) pay to the Company in cash an amount equal to the Fair Market Value of such Shares as of the respective settlement dates of the underlying Units (with respect to Shares received hereunder that you previously sold). The Company also shall be entitled to set-off against the amount of any such gain any amount owed to you by the Company.

(c)Restrictive Covenants.

(1) Non-Disclosure and Return of Confidential Information. You have or will be given access to and provided trade secrets, confidential and proprietary information, and other non-public information and data of or about the Company (and its Affiliates) and its business (“Confidential Information”) in the course of your Service which is of unique value to the Company. Examples of Confidential Information include, without limitation, hard copy or electronically stored information, documents or records including any sensitive, confidential, proprietary, or trade secret information related to: confidential business or manufacturing processes; research and development information; inventions, improvements and designs; new product or marketing plans; business strategies and plans; merger and acquisition targets; financial and pricing information; computer programs, source codes, models and databases; analytical models; human resources strategies; the skills and compensation of the Company’s (and its Affiliates’) employees, contractors, and any other service providers of the Company (or its Affiliates); customer lists and information; information received from or about third parties that the Company is obligated to keep confidential; supplier and vendor lists; the existence or content of any business discussions, negotiations, or agreements between the Company (or any of its Affiliates) and any Customer or Restricted Prospective Customer, or any other third party; and other information which is not generally available to the public. You agree not
5


EXHIBIT 10.2
to disclose, publish or use Confidential Information, either during or after your Service is terminated, except (1) as necessary to perform your duties during your term of Service, (2) as the Company may consent in writing, (3) as required by law or judicial process, provided you (unless prohibited by applicable law) promptly notify the Company in writing of any subpoena or other judicial request for disclosure involving Confidential Information or trade secrets, and reasonably cooperate with any effort by the Company to obtain a protective order preserving the confidentiality of the Confidential Information or trade secrets, or (4) in connection with reporting possible violations of law or regulations to any governmental agency or from making other disclosures protected under any applicable whistleblower laws. The confidentiality obligations set forth herein shall continue indefinitely, for so long as the Confidential Information remains confidential (and you understand that you will not be relieved of your obligations if the Confidential Information loses its confidential nature because of a breach of any of your obligations to the Company or its Affiliates). If this Agreement is enforced by a court applying the law of a jurisdiction where a time frame is required for a non-disclosure provision to be enforceable with respect to information that does not rise to the level of a trade secret, then your obligations with respect to such information will be in effect during your term of Service and for three (3) years thereafter. You further agree to return any and all Confidential Information, whether in hard or electronic format, regardless of the location on which such information may reside, no later than three (3) business days following the termination of your Service or at any other time at the Company’s request. You understand that access or use of the Company’s electronic databases, computer network and electronically stored information is for the Company’s benefit only and that any use of the Company’s electronic databases, computer network or electronically stored information or removal or use of information from the Company’s electronic databases, computer network or other electronically stored information for any other purpose is unauthorized or prohibited. Notwithstanding anything to the contrary herein or in any policy of the Company, you may not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made (A) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney if such disclosure is made solely for the purpose of reporting or investigating a suspected violation of law or for pursuing an anti-retaliation lawsuit; or (B) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal and you do not disclose the trade secret except pursuant to a court order. In the event a disclosure is made, and you file a lawsuit against the Company alleging that the Company retaliated against you because of your disclosure, you may disclose the relevant trade secret or confidential information to your attorney and may use the same in the court proceeding only if (x) you ensure that any court filing that includes the trade secret or confidential information at issue is made under seal; and (y) you do not otherwise disclose the trade secret or confidential information except as required by court order.
(2)    No Solicitation of or Competitive Business with Customers. During the Restricted Period, you shall not, directly or indirectly, (i) provide, sell, market, attempt to provide, sell or market, or assist any person or entity in the provision, sale or marketing of any Competitive Product to any Customer with respect to whom, at any time during the twenty-four (24) months immediately preceding the termination of your Service, you sold, provided, or assisted in or supervised the sale or provision of, any products or services on behalf of the Company (or an Affiliate), you designed, developed or manufactured, or assisted in or supervised the design, development or manufacture of any product on behalf of the Company (or an Affiliate), you had any business contact on behalf of the Company (or an Affiliate), you had any relationship, business development, sales, service or account responsibility (including, without limitation, any supervisory or managerial responsibility) on behalf of the Company (or an Affiliate), or you had access to, or gained knowledge of, any Confidential Information concerning the Company’s (or an Affiliate’s) business with such Customer, or (ii) otherwise solicit or communicate with any such Customer as described in (i) above for the purpose of selling or providing any Competitive Product. For avoidance of doubt, the foregoing covenant prohibits, among other things, you from being employed or engaged by or providing Competitive Services to any Customer in any manner in which you will be developing, producing, providing, or managing the development, production or provision of, any Competitive Product to or for the benefit of such Customer if such Competitive Product displaces, diminishes the need for, or serves as a substitute for, any products that the Company or any of its Affiliates provided, or could provide, to such Customer.
6


EXHIBIT 10.2
(3)    No Solicitation of or Competitive Business with Restricted Prospective Customers. During the Restricted Period, you shall not, directly or indirectly, (i) provide, sell, market, attempt to provide, sell or market, or assist any person or entity in the provision, sale or marketing of any Competitive Product to any Restricted Prospective Customer or (ii) otherwise solicit or communicate with any Restricted Prospective Customer for the purpose of selling or providing any Competitive Product. For avoidance of doubt, the foregoing covenant prohibits, among other things, you from being employed or engaged by or providing Competitive Services to any Restricted Prospective Customer in any manner in which you will be developing, producing, providing, or managing the development, production or provision of, any Competitive Product to or for the benefit of the Restricted Prospective Customer if such Competitive Product displaces, diminishes the need for, or serves as a substitute for, any product that the Company or any of its Affiliates provided, or could provide, to such Restricted Prospective Customer.

(4)    No Hire. During the Restricted Period, you shall not, directly or indirectly: (i) solicit, recruit, hire, employ, engage the services of or attempt to hire, employ or engage the services of any individual who is an employee or contractor of the Company or an Affiliate (or who was, within the six (6) months prior to the termination of your Service, an employee or contractor of the Company or an Affiliate); (ii) assist any person or entity in the recruitment, hiring or engagement of any individual who is an employee or contractor of the Company or an Affiliate (or who was, within the six (6) months prior to the termination of your Service, an employee or contractor of the Company or an Affiliate); (iii) urge, induce or seek to induce any individual to terminate his/her employment or engagement with the Company or an Affiliate; or (iv) advise, suggest to or recommend to any Competitor or other entity with which you are employed or otherwise associated that it employ, engage the services of or seek to employ or engage the services of any individual who is an employee or contractor of the Company or an Affiliate (or who was, within the six (6) months prior to the termination of your Service, an employee or contractor of the Company or an Affiliate).
(5)    No Competition. During the Restricted Period, you shall not, directly or indirectly, on your own behalf or on behalf of any person or entity other than the Company or an Affiliate, including as a proprietor, principal, agent, partner, officer, director, shareholder, employee, member of any association, consultant or otherwise, perform Competitive Services in the Restricted Area for or on behalf of any Competitor, with respect to Competitive Products.
(6)    Non-Disparagement. During your term of Service and afterward, you shall not, directly or indirectly, criticize, make any negative comments about or otherwise disparage the Company, its Affiliates or any persons or entities associated with any of them, whether orally, in writing, electronically or otherwise, directly or by implication, to any person or entity, including Company customers or agents; provided, however, that nothing in this Section 8(c)(6) is intended to prohibit you from (A) making any disclosures or statements in good faith in the normal course of performing your duties or responsibilities for the Company during your Service; (B) making any disclosures as may be required or compelled by law or legal process; or (C) making any disclosures or providing any information to a governmental agency or entity, including without limitation in connection with a complaint by you against the Company or the investigation of any complaint against the Company.
(7)    No Injurious, Detrimental or Prejudicial Conduct. Except as otherwise permitted in Section 8(c)(6), during your term of Service or afterward, you shall not, directly or indirectly, engage in any conduct or inaction, or omit to take any action, which conduct, action or inaction is reasonably determined by the Committee to be injurious, detrimental or prejudicial to the business or reputation of the Company or its Affiliates or any interest of the Company and its Affiliates, including, but not limited to, a violation of any material Company or Affiliate policy or a violation of any federal or state securities laws, rules or regulations or of any rule or other requirement of any securities exchanges on which the Company’s Shares may, at the time, be listed.
(d)Compensation Recovery Policy. In addition to those provisions in Sections 8(a), 8(b) and 8(c), to the extent that this Award and any compensation associated therewith is considered “incentive-based compensation” within the meaning and subject to the requirements of Section 10D of the Exchange Act, this Award and any compensation associated therewith shall be subject to potential forfeiture or recovery by the
7


EXHIBIT 10.2
Company in accordance with any compensation recovery policy adopted by the Board or the Committee in response to the requirements of Section 10D of the Exchange Act and any implementing rules and regulations thereunder, or as otherwise required by law.  This Agreement may be unilaterally amended by the Committee to comply with any such compensation recovery policy.
(e)Remedies. The parties expressly agree that the forfeiture and repayment obligations contained in this Section 8 are in addition to, and not in lieu of, any and all other legal and/or equitable remedies, including without limitation, injunctive relief, that may be available to the Company in connection with your breach of Section 8(c), and the Company reserves it rights to pursue all such remedies.  You acknowledge and agree that your breach of Section 8(c) will cause irreparable injury to the Company and that money damages will not be adequate relief for such injury and, accordingly, you agree that the Company shall be entitled to obtain equitable relief, including, but not limited to, temporary restraining orders, preliminary injunctions and/or permanent injunctions, without having to post any bond or other security, to restrain or enjoin such breach, in addition to all other remedies which may be available to the Company.

9.    Definitions.
(a)    Affiliate. “Affiliate” means any entity that directly, or indirectly through one or more intermediaries, is owned or controlled by, owns or controls, or is under common ownership or control with, the Company; for this purpose, “control” of an entity means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of the entity, whether through the ownership of voting securities, by contract or otherwise.
(b)    Approved Retirement. “Approved Retirement” means any voluntary termination of employment on or after the date on which the sum of your age and years of employment with the Company or its Affiliates equals at least sixty-five (65) with the approval of the Committee, or any other termination of employment that the Committee determines to qualify as an Approved Retirement.
(c)    Competitive Products. “Competitive Products” are products and/or services that are the same as or substantially similar to (in terms of type, brand or purpose)the products and/or services offered by the Company or its Affiliates in its business, including but not limited to products: (i) regarding which you performed any services for the Company or its Affiliates at any time during the twenty-four (24) month period immediately preceding the termination of your Service; and/or (ii) about which you had access to any Confidential Information at any time during the twenty-four (24) month period immediately preceding the termination of your Service.
(d)    Competitive Services. “Competitive Services” means services that are the same as or substantially similar to (in terms of type or purpose) the services you performed for or on behalf of the Company or its Affiliates at any time during the twenty-four (24) month period immediately preceding the termination of your Service.
(e)    Competitor. “Competitor” means any individual or entity (including a Customer) that engages in the business (in whole or in any part) of the Company or its Affiliates, and which manufactures, markets, sells or distributes products and/or services that are the same as or substantially similar to (in terms of type, brand or purpose) the products and/or services manufactured, marketed, sold or distributed by the Company or its Affiliates, as of the date on which your Service terminates.
(f)    Customer. “Customer” means any individual or entity as to which, with or to whom, within the twenty-four (24) month period immediately preceding the termination of your Service: (i) any products or services were provided by the Company, or (ii) any contract was entered into with the Company for the provision of any products or services.
(g)    Good Reason. “Good Reason” means the existence of one or more of the following conditions without your written consent, so long as you provided written notice to the Company of the existence of the condition not later than 90 days after the initial existence of the condition, the condition has not been remedied by the Company within 30 days after its receipt of such notice and you terminate your Service no later than 130 days after the condition’s initial occurrence: (i) a material reduction in your base salary other than in connection with a general reduction affecting a group of employees; (ii) a relocation of
8


EXHIBIT 10.2
your primary work location by more than 100 miles; or (iii) any material reduction in your authority, duties or responsibilities.
(h)    Restricted Area. Because of the nature of the Company’s business and the nature of your duties and responsibilities for the Company, your obligations under Section 8(c)(5) shall apply in each of the following geographic areas, which shall collectively be defined as the “Restricted Area”: (i) the State of Indiana; (ii) Elkhart County, Indiana, and the contiguous counties thereto (including the contiguous counties in the State of Michigan); and (iii) the area(s) within a 100 mile radius of any office, facility and/or manufacturing operation of the Company (or of any Affiliate) to which you were assigned to work or report, at which you worked or performed services or for which you were responsible, in whole or in part, for managing for or on behalf of the Company (or any Affiliate) as of the termination of your Service or at any time during the twenty-four (24) months immediately preceding the termination of your Service.
(i)    Restricted Period. “Restricted Period” means during the term of your Service and for the twenty-four (24) month period immediately after the termination of your Service, regardless whether such termination was voluntary or involuntary.
(j)    Restricted Prospective Customer. “Restricted Prospective Customer” means: (i) any person or entity whom you, on behalf of the Company (or any Affiliate), solicited, assisted in the solicitation of, or engaged in marketing, sales or business development efforts towards, at any time during the twelve (12) months immediately preceding the termination of your Service; and/or (ii) any person or entity to whom the Company (or any Affiliate) submitted a quotation, bid or sales proposal at any time during the twelve (12) months immediately preceding the termination of your Service if you were involved in or aware of such quotation, bid or sales proposal during your Service.
10.    Notices. Every notice or other communication relating to this Agreement shall be in writing and shall be mailed to or delivered (including electronically) to the party for whom it is intended at such address as may from time to time be designated by it in a notice mailed or delivered to the other party as herein provided. Unless and until some other address is so designated, all notices or communications by you to the Company shall be mailed or delivered to the Company, to the attention of its Vice President- Chief Legal Officer at the Company’s offices located at 4100 Edison Lakes Pkwy, Suite 210, Mishawaka, IN 46545, legal@lci1.com. All notices or communications by the Company to you may be given to you personally or may be mailed or, if you are still a Service Provider, emailed to you at the address indicated in the Company’s records as your most recent mailing or email address.

11.    Additional Provisions.
(a)    Standing. The Company’s Affiliates are intended third-party beneficiaries of this Agreement and this Agreement may be enforced by the Company and/or its Affiliates, either singularly or jointly.

(b)    No Right to Continued Service. This Agreement does not give you a right to continued Service with the Company or any Affiliate, and the Company or any such Affiliate may terminate your Service at any time and otherwise deal with you without regard to the effect it may have upon you under this Agreement.

(c)    Governing Plan Document. This Agreement and the Award are subject to all the provisions of the Plan, and to all interpretations, rules and regulations which may, from time to time, be adopted and promulgated by the Committee pursuant to the Plan. If there is any conflict between the provisions of this Agreement and the Plan, the provisions of the Plan will govern.

(d)    Governing Law; Venue; Waiver of Jury Trial.  To the extent not pre-empted by federal law, this Agreement, the parties’ performance hereunder, and the relationship between them shall be governed by, construed, and enforced in accordance with the laws of the State of Delaware, without giving effect to the choice of law principles thereof. Each party hereto agrees that any legal action arising out of or relating to this Agreement shall be commenced and maintained exclusively before any state or federal court having appropriate subject matter jurisdiction located in St. Joseph County, Indiana. Further, each party hereto irrevocably consents and submits to the personal jurisdiction and venue of such courts located in St. Joseph County, Indiana, and waives any right to challenge or otherwise object to personal jurisdiction or venue
9


EXHIBIT 10.2
(including, without limitation, any objection based on inconvenient forum grounds) in any action commenced or maintained in such courts located in St. Joseph County, Indiana; provided, however, the foregoing shall not affect any applicable right a party may have to remove a legal action to federal court. EACH PARTY HERETO VOLUNTARILY AND IRREVOCABLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT.

(e)    Severability. The provisions of this Agreement shall be severable and if any provision of this Agreement is found by any court to be unenforceable, in whole or in part, the remainder of this Agreement shall nevertheless be enforceable and binding on the parties. You also agree that any trier of fact may modify any invalid, overbroad or unenforceable provision of this Agreement so that such provision, as modified, is valid and enforceable under applicable law.

(f)    Independent Covenants. To the extent you are or become subject to any other agreements with the Company or any Affiliate that contain restrictive covenants, including, but not limited to, any employment agreement, non-competition agreement, non-disclosure agreement or non-solicitation agreement, the restrictive covenants set forth in Section 8 of this Agreement are independent of, supplement and do not supersede such other agreements.

(g)    Binding Effect. This Agreement will be binding in all respects on your heirs, representatives, successors and assigns, and on the successors and assigns of the Company.

(h)    Section 409A of the Code. The award of Units as provided in this Agreement and any issuance of Shares or payment pursuant to this Agreement are intended to comply with Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations and guidance promulgated thereunder (“Section 409A”), to the extent subject thereto, and accordingly, to the maximum extent permitted, this Agreement shall be interpreted and administered to be in compliance therewith. If at the time of your separation from service (as defined in Code Section 409A), you are a “specified employee”, then the Company will defer the payment or commencement of any nonqualified deferred compensation subject to Code Section 409A payable upon separation from service (without any reduction in such payments or benefits ultimately paid or provided to you) until the date that is six (6) months following your separation from service or, if earlier, the earliest other date as is permitted under Code Section 409A (and any amounts that otherwise would have been paid during this deferral period will be paid in a lump sum on the day after the expiration of the six (6) month period or such shorter period, if applicable). The term “specified employee” means an individual determined by the Company to be a specified employee under Treasury regulation Section 1.409A-1(i). The Company makes no representation that any or all of the payments described in this Agreement will be exempt from or comply with Section 409A and makes no undertaking to preclude Section 409A from applying to any such payment. You understand and agree that you shall be solely responsible for the payment of any taxes, penalties, interest or other expenses incurred by you on account of non-compliance with Section 409A.

(i)    Electronic Delivery and Acceptance. The Company may deliver any documents related to this Award by electronic means and request your acceptance of this Agreement by electronic means. You hereby consent to receive all applicable documentation by electronic delivery and to participate in the Plan through an on-line (and/or voice activated) system established and maintained by the Company or the Company’s third-party stock plan administrator.

By signing the cover page of this Agreement or otherwise accepting this Agreement in a manner approved by the Company, you agree to all the terms and conditions described above and in the Plan document.
10



Annex A
ROIC Metric

The Units can be achieved if ROIC for the Measurement Period exceeds a threshold percentage, and the number of Units achieved will be determined in proportion to the ROIC percentage for the Measurement Period over the threshold ROIC percentage up to the maximum ROIC percentage, in accordance with the chart below. Except as otherwise provided in Section 4, the number of Units that shall be achieved will be determined by the Committee in its sole discretion.
The term “ROIC”, or “Return on Invested Capital”, means Operating Profit divided by Average Invested Capital, where: (i) “Operating Profit” is the Company’s fiscal year consolidated operating profit, as detailed in the Company’s financial statements filed with the U.S. Securities and Exchange Commission (“SEC”); and (ii) “Average Invested Capital” is the average of the prior year end and current year quarterly (Total Stockholders Equity + Indebtedness) – (Cash, Cash Equivalents and Short-Term Investments).
“Total Stockholders’ Equity” is the Company’s total stockholders’ equity as of the particular measurement date, as detailed in the Company’s financial statements filed with the SEC.
“Indebtedness” is the Company’s indebtedness as of the particular measurement date, as detailed in the Company’s financial statements filed with the SEC. For the purpose of this ROIC calculation, Indebtedness shall include bank lines of credit, bonds, mortgages, and capital leases, but shall exclude obligations relating to operating lease obligations.
“Cash, Cash Equivalents and Short-Term Investments” is the sum of the cash, cash equivalents and short-term investments as of the particular measurement date, as detailed in the Company’s financial statements filed with the SEC.
In addition, the Committee may adjust ROIC to exclude the impact of the following: (i) accretion expense; (ii) goodwill impairment; (iii) charges for reorganizing or restructuring; (iv) charges from asset write-downs; (v) acquisitions or divestitures; (vi) foreign exchange gains or losses; (vii) changes in accounting principles or tax laws, rules or regulations, including, without limitation, the effect of the U.S. tax reform act signed into law on December 22, 2017; and (viii) extraordinary, unusual, transition, one-time and/or non-recurring items as determined by the Committee from time to time.
Calculation of Units at end of Measurement Period

ROIC PerformanceMultiple of Target Number of Units
16% (Threshold)0.40x
20% (Target)1.00x
24% (Maximum)2.00x

When ROIC performance is between inflection points, linear interpolation will be used to determine the number of Units.

ROIC will be measured each fiscal year as a 3-year rolling average calculation.

The ROIC calculation will be un-adjusted for acquisition purposes.



11
US.137065302.09




EXHIBIT 10.3
EXECUTIVE EMPLOYMENT AGREEMENT

This Executive Employment Agreement (“Agreement”) is made this ____ day of ___________, 20__, between ____________________ ("Executive") and Lippert Components, Inc. (the "Corporation"), and is effective as of ____________________ (the "Effective Date"). This Agreement's purposes are to set forth certain terms of Executive's employment by the Corporation or one of its affiliates and to protect the Corporation's knowledge, expertise, customer relationships, and confidential information. The Corporation has several divisions and certain relationships with related companies and other affiliates, including but not limited to LCI Industries ("LCI Industries") and Lippert Components Manufacturing, Inc., as well as other entities (each, an "Affiliate"). To the extent Executive is assigned to an Affiliate by the Corporation, performs services for an Affiliate, and/or has access to confidential or proprietary information of an Affiliate, the term "Corporation" as used in this Agreement only, shall also be deemed to include any other Affiliate to which Executive is assigned, for which Executive performs any services, and/or about which Executive is exposed to confidential or proprietary information during Executive's employment relationship with the Corporation.

1.Employment and Duties.

A.Employment. The Corporation hereby employs Executive, and Executive accepts employment, under this Agreement's terms, for the period beginning the Effective Date and ending on December 31, 20__ (the "Employment Period"), unless sooner terminated pursuant to the terms of Section 3 of this Agreement. The Employment Period shall automatically be extended for successive additional one-year periods on January 1st commencing on January 1, 20__ unless either party to this Agreement provides the other party with notice of termination of this Agreement at least sixty (60) days prior to the date on which the Employment Period would be automatically extended for an additional one year, or unless otherwise sooner terminated pursuant to the terms of Section 3 of this Agreement. The principal place of employment and the location of Executive's principal office and normal place of work shall be at the Corporation's principal executive offices within Elkhart County or St. Joseph County, Indiana. Given the geographic scope of the Corporation's business and the fact that Executive's duties and responsibilities will be as co-extensive, geographically, as the scope of the Corporation's business, Executive will be expected to travel to other locations, as necessary, in the performance of Executive's duties; provided, however, Executive shall at no time be required to change the locale of his residence without his consent.

B.Title and Duties. Executive will be employed as the __________________ of Lippert Components, Inc., will be duly appointed an officer of Lippert Components, Inc., and will report directly to the _______________________ of Lippert Components, Inc. Executive will perform such duties, and exercise such supervision and control with regard to the business of the Corporation, as are commonly associated with Executive's position. Executive will devote substantially all of Executive's business time and energy to Executive's duties at the Corporation. Executive will maintain operations in Executive's area of responsibility, and make every reasonable effort to ensure that the employees within that area of responsibility act, in compliance with applicable law and the Corporation's Guidelines for Business Conduct, as amended from time to time. Executive is subject to all of the Corporation's employment policies and procedures (except as specifically superseded by this Agreement).

Executive Employment Agmt.




EXHIBIT 10.3
2.Compensation and Benefits.

A.Base Salary. Executive's initial aggregate annual base salary will be $______, less applicable withholdings and deductions, payable according to the Corporation's regular payroll schedule. Executive's base salary shall be reviewed annually and may be increased in the Corporation's sole discretion from time to time.

B.Short-term Incentive Compensation. Executive will be eligible to participate in the Corporation's management incentive compensation plans, adopted by the Corporation from time to time, in the Corporation's discretion and in accordance with such plans' terms and conditions. Executive's target short-term incentive compensation for fiscal year 20__, payable in fiscal year 20__, shall be $_________, which equals Executive’s base salary multiplied by _____. The target necessary to earn such incentive compensation shall be established by the Corporation in its 20__ management incentive compensation plans.

C.Equity Awards. Executive will be eligible for stock-based awards in the Corporation's discretion from time to time. The total amount of Executive's target stock-based awards for fiscal year 20__, to be granted in fiscal year 20__, shall be equal to $___________, in restricted stock unit (“RSU”) value, which amount equals Executive’s base salary multiplied by ______, and $________ in performance stock unit (“PSU”) value, which amount equals Executive’s base salary multiplied by ______.  The RSUs and PSUs shall be governed by those certain award agreements entered into between the Executive and the Corporation upon the grant of such awards. The target(s) necessary to earn such stock based awards shall be established by the Corporation in its 20__ management incentive compensation plans.

D.Employee Benefits. Executive will be eligible to participate in the Corporation's employee welfare plans (health, dental, life, short-term and long-term disability insurance coverage), retirement or savings plans, and other benefit plans on the same basis as other similarly situated executives, in accordance with the terms of the plans. The Corporation reserves the right to amend or discontinue any plan or policy at any time in its sole discretion. Executive agrees to have an annual comprehensive physical examination at the expense of the Corporation (to the extent not covered by insurance) by a physician of his choice. In addition to the Corporation's generally available benefits, the Corporation shall provide Executive, at the Corporation's expense during the term of Executive's employment:

i.The Executive shall be eligible to participate in any pension, retirement, deferred compensation, or profit-sharing plan adopted by the Corporation for the benefit of its executives.

ii.To supplement standard long-term disability coverage, the Corporation shall maintain, to the extent such coverage is available on commercially reasonable terms (as determined by the Corporation in its discretion), at no cost to Executive, disability insurance (subject to the terms and conditions of the underlying policy) providing for weekly payments to Executive, in the event Executive shall fail or be unable to perform his obligations hereunder, in the amount of not less than $120,000 per year. Such payments shall continue for the maximum available term after the commencement of disability.
Executive Employment Agmt.




EXHIBIT 10.3

iii.The Corporation will provide an automobile allowance of $750 per month, less applicable withholdings, in accordance with the Corporation's automobile policy, together with reimbursement for gasoline, customary insurance, maintenance, and registration fees on presentation of expense vouchers, to be used in connection with the business of the Corporation.

iv.Executive shall be entitled to a vacation in each year during the Employment Period of not less than 3 weeks. Executive shall not be entitled to any additional payout for unused vacation during any given year.

E.Expenses. All travel and other expenses incident to the rendering of services by Executive hereunder in accordance with the travel policies of the Corporation will be paid by the Corporation. If any such expenses are paid in the first instance by Executive, the Corporation will reimburse him therefore on presentation of expense vouchers.

3.Term and Termination of Employment.

A.Term. This Agreement shall continue in full force and effect during the Employment Period until terminated as set forth in Section 1 or as otherwise set forth under Section 3.B below.

B.Termination.

i.    By Mutual Agreement. The parties may terminate Executive's employment at any time by mutual agreement.

ii.    By the Corporation without Cause. The Corporation may terminate Executive's employment without Cause upon 90 days' prior written notice.

iii.    By the Corporation with Cause. The Corporation may terminate Executive's employment at any time for Cause. "Cause" means Executive's (a) willful and continued failure to follow the Corporation's reasonable direction or to perform any duties reasonably required of Executive (other than any such failure resulting from his disability or from termination by Executive for Good Reason), after written demand for substantial performance is delivered to Executive specifying in reasonable detail the manner in which Executive has not performed, and Executive has not remedied such failure within 30 days after notice thereof, (b) material violation of, or failure to act upon or report known or suspected violations of, the Corporation's Guidelines for Business Conduct, as amended or replaced from time to time, (c) conviction of, or a plea of nolo contendere with respect to, any felony, (d) commission of any criminal, fraudulent, or dishonest act in connection with Executive's employment, (e) material breach of this Agreement which, if capable of remedy, continues for a period of 30 days without remedy thereof by Executive after notice thereof, or two or more such breaches in any two month period, or (f) one or more instances of willful misconduct or gross negligence that, individually or in the aggregate, is materially detrimental to the
Executive Employment Agmt.




EXHIBIT 10.3
Corporation's interests. In such event, Executive shall be entitled to no further compensation or payments from the Corporation other than earned but unpaid salary or benefits. In any instance where the Corporation may have grounds for Cause, failure by the Corporation to provide written notice of the grounds for Cause within 120 days of discovery shall be a waiver of its right to assert the subject conduct as a basis for termination for Cause.

iv.     By Executive without Good Reason. Executive may resign and terminate Executive's employment at any time for any reason, including due to Executive's retirement, upon 90 days' prior written notice. In such event, Executive shall be entitled to no further compensation or payments from the Corporation other than earned but unpaid salary or benefits.

v.     By Executive for Good Reason. Executive may terminate Executive's employment for Good Reason, as defined below, upon 90 days' prior written notice. Executive must give the Corporation written notice specifying in reasonable detail the circumstances constituting Good Reason, within 120 days after becoming aware of such circumstances, or such circumstances will not constitute Good Reason. If the circumstances constituting Good Reason are reasonably capable of being remedied, the Corporation will have 90 days to remedy such circumstances. "Good Reason" will exist if the Corporation takes any of the following actions, without Executive's consent: (a) materially reduces Executive's base salary other than in connection with a general reduction affecting a group of employees or, to the extent deemed minimally necessary by the Board in good faith, in response to the Board's failure to receive stockholder approval, on an advisory basis, of the Corporation's executive compensation program at the Annual Meeting of Stockholders of LCI Industries; (b) moves Executive's primary work location more than 100 miles; (c) assigns to Executive any duties materially inconsistent in any respect with Executive's position (including status, offices, titles, and reporting relationships) as contemplated by Section 1 or otherwise makes changes that substantially diminish Executive's position, authority, duties, or responsibilities, excluding an insulated, insubstantial, and inadvertent action not taken in bad faith and which is promptly remedied by the Corporation; or (d) any other material breach of this Agreement by the Corporation that is not remedied within the time period specified above after written notice thereof.

vi.     Due to Executive's Death. Executive's employment will terminate automatically if Executive dies, effective as of the date of Executive's death.

vii.    Due to Executive’s Disability. The Corporation may, upon 30 days' prior written notice to Executive from the Corporation, terminate Executive's
Executive Employment Agmt.




EXHIBIT 10.3
employment due to Executive's physical or mental disability that renders Executive incapable of performing the essential functions of Executive's job, with or without reasonable accommodation, and which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months. The Corporation will determine whether Executive has incurred a disability based on its own good faith determination, and may require Executive to submit to reasonable physical and mental examinations for this purpose. In the absence of agreement between the Corporation and Executive (or his legal representative), each party shall nominate a qualified physician and the two physicians so nominated shall select a third physician who shall make the determination as to disability.

4.Severance and Death/Disability Benefits.

A.Circumstances under Which Severance Benefits Payable. Executive will be entitled to the severance benefits described in Section 4.B ("Severance Benefits") only if Executive's employment during the Employment Period is terminated by the Corporation without Cause under Section 3.B(ii) (including if the Corporation terminates Executive's employment without Cause within 120 days following the expiration of the original Employment Period or any subsequent one-year period as described in Section 1, as applicable, but excluding death or disability) or is terminated by Executive for Good Reason under Section 3.B(v). Whether Executive has had a termination of employment will be determined in a manner consistent with the definition of "Separation from Service" under Section 409A of the Internal Revenue Code of 1986 and its accompanying regulations ("Section 409A") and will be referred to herein as a "Termination." For purposes of this Agreement, Executive will be considered to have experienced a Termination as of the date that the facts and circumstances indicate that it is reasonably anticipated that Executive will provide no further services after such date or that the level of bona fide services that Executive is expected to perform permanently decreases to no more than 20% of the average level of bona fide services that Executive performed over the immediately preceding 36-month period. In consideration of the Severance Benefits in this Agreement, Executive waives any payments or benefits to which Executive otherwise might be or become entitled under any severance plan or program of the Corporation.

B.Severance Benefits. Subject to Section 4.C, Executive shall be entitled to the following Severance Benefits if Executive experiences a Termination under the circumstances described in Section 4.A above:

i.    An amount equivalent to two times Executive's annual base salary (at the highest annualized rate in effect at any time within two years of the date of Executive's Termination).

ii.     An amount equivalent to two times Executive's average bonus or incentive compensation actually paid to Executive, if any, during the 36-month period immediately preceding his Termination (excluding equity awards, payments under any long-term or similar benefit plan, or any other special or one-time bonus or incentive compensation payments, and provided that the three-year average shall not exceed Executive's then-current annual base salary).

Executive Employment Agmt.




EXHIBIT 10.3
iii.        Amounts payable under a then-current management incentive plan will be paid out to Executive in accordance with the terms thereof. All stock-based awards granted to Executive that vest solely on the passage of time and which have not vested as of the date of Executive's Termination shall immediately vest and become exercisable pursuant to the terms thereof. Awards that vest upon the achievement of one or more performance goals, such as performance stock awards, will terminate in accordance with their terms.

iv.     A lump sum payment, minus applicable deductions, including deductions for tax withholding, to offset costs of COBRA equal to the current COBRA premium in effect at the date of Termination, multiplied by 12, which amount will be paid within 30 days following the Starting Date (defined below).

v.     Outplacement services, for a time period (not less than 6 months following the Starting Date (defined below)) established by the Corporation, consistent with those provided to similarly situated executives provided by an outplacement firm selected by the Corporation in its sole discretion, and at the expense of the Corporation.

Except as provided in Section 4.F or as otherwise provided herein, the Severance Benefits in Sections 4.B(i)-(ii) will be paid out, minus applicable deductions, including deductions for tax withholding, in equal weekly payments on the regular payroll cycle over the 24-month period following Executive's Termination. Except as provided in Section 4.F or as otherwise provided herein, commencement of the Severance Benefits shall begin on the first payroll date following the date on which Executive's release of claims under Section 4.C becomes effective (but only if such release becomes effective within the 75-day period following Executive's Termination) (the "Starting Date"); provided, that the payment of Severance Benefits required under this Section 4 shall be made or commence (as applicable) in the second calendar year if such 75-day period begins in one calendar year and ends in the subsequent calendar year. If Executive revokes or does not sign the Release Agreement during such 75-day period, no severance or other benefits shall be payable hereunder. The first payment on the Starting Date shall include those payments that would have been previously paid if the payments of the severance compensation had begun on the first payroll date following the date of Executive's Termination. Executive's entitlement to the payments of the severance compensation described in Sections 4.B(i)-(ii) shall be treated as the entitlement to a series of separate payments for purposes of Section 409A. Executive shall not be required to mitigate the amount of any payment or benefit provided for in this Agreement by seeking other employment or otherwise; nor shall the amount of any payment or benefit provided for under this Agreement be reduced by any compensation earned by Executive as a result of employment by another employer or by any other benefits received by Executive from another employer, except as provided in Section 4.C below.

C.Separation Agreement and Release Required. In order to receive any Severance Benefits or Disability Benefits (defined in Section 4.E below) under this Agreement, Executive must timely sign and not revoke a separation agreement and release of claims (containing a full and complete release by Executive of any and all claims of every kind and nature against the Corporation) in a form acceptable to and determined by the Corporation in its discretion. The
Executive Employment Agmt.




EXHIBIT 10.3
Corporation shall provide to Executive a form of separation agreement and release of claims no later than three (3) days following Executive's date of Termination. If Executive does not timely execute and deliver to the Corporation such separation agreement and release, or if Executive does so, but then revokes it if permitted by and within the time required by applicable law, the Corporation will have no obligation to pay or provide any of the Severance Benefits or Disability Benefits to Executive. It is expressly understood that the Corporation's payment obligations under Section 4.B or 4.E, respectively, shall cease in the event Executive breaches any of his agreements in Section 5 hereof and, in the event of any such breach, Executive shall repay in cash immediately to the Corporation any amounts previously paid to Executive under Section 4.B or 4.E, respectively.

D.Death Benefits. In addition to earned but unpaid salary and benefits, Executive (and his estate, beneficiaries, or any other person legally claiming through him) shall be entitled to the following compensation if Executive experiences a Termination because of death ("Death Benefits"): The Corporation shall continue to pay to the heir or designee of Executive (i) Executive's base salary for a period of one year from the date of death of Executive, and (ii) Executive's incentive compensation (excluding equity awards), which Executive would have been entitled to receive at the completion of the year of Executive's death but for such termination. The base salary portion of Death Benefits will be paid out, minus image_0a.jpgapplicable deductions, including deductions for tax withholding, in equal weekly payments on the regular payroll cycle. Incentive compensation will be calculated and paid in accordance with the terms of the applicable plan. All stock-based awards granted to Executive, other than awards granted under a long-term incentive plan, which have not vested as of the date of Executive's Termination, which, for the purpose of this Section 4.D., is the date of Executive’s death, shall immediately vest and become exercisable pursuant to the terms thereof. Awards granted under a long-term incentive plan, such as performance stock awards, will remain outstanding subject to their terms. All shares of stock deliverable pursuant to outstanding PSUs awarded to Executive will be delivered to the heir or designee of Executive pursuant to the terms thereof.

E.Disability Benefits. In addition to earned but unpaid salary and benefits, Executive shall be entitled to the following compensation if Executive
Executive Employment Agmt.




EXHIBIT 10.3
experiences a Termination because of disability ("Disability Benefits"): The Corporation shall pay to Executive (i) the difference between Executive's base salary and the amount of disability payments received by the Executive pursuant to disability insurance provided in accordance with this Agreement, for a period of one year from the date of Executive's Termination, and (ii) Executive's incentive compensation (excluding equity awards), which Executive would have been entitled to receive at the completion of the year of Executive's Termination but for such termination. Except as provided in Section 4.F or as otherwise provided herein, the base salary portion of Disability Benefits will be paid out, minus applicable deductions, including deductions for tax withholding, in equal weekly payments on the regular payroll cycle. Incentive compensation will be calculated and paid in accordance with the terms of the applicable plan. All stock-based awards granted to Executive, other than awards granted under a long-term incentive plan, which have not vested as of the date of Executive's Termination shall immediately vest and become exercisable pursuant to the terms thereof. Awards granted under a long-term incentive plan, such as performance stock awards, will remain outstanding subject to their terms. All shares of stock deliverable pursuant to outstanding PSUs awarded to Executive will be delivered pursuant to the terms thereof. Additionally, a lump sum payment, minus applicable deductions, including deductions for tax withholding, to offset costs of COBRA equal to the current COBRA premium in effect at the date of Termination, multiplied by 12, which amount will be paid within 30 days following Termination.

F.Compliance with Section 409A. If Executive is a "Specified Employee" (within the meaning of Section 409A and determined pursuant to procedures adopted by the Corporation) at the time of Executive's Termination and any amount that would be paid to Executive during the six-month period following Termination constitutes "Deferred Compensation" (within the meaning of Section 409A), such amount shall not be paid to Executive until the later of (i) six months after the date of Executive's Termination, and (ii) the payment date or commencement date specified in this Agreement for such payment(s). On the first regular payroll date following the expiration of such six-month period (or if Executive dies during the six-month period, the first payroll date following the death), all payments that were delayed pursuant to the preceding sentence shall be paid to Executive in a single lump sum and thereafter all payments shall be made as if there had been no such delay. All Severance Benefits described in Section 4.B shall be paid by, and no further severance compensation shall be paid or payable after, December 31 of the second calendar year following the year in which Executive's Termination occurs. Severance Benefits under this Agreement are intended to be exempt from section 409A of the Code under the "separation pay exception," to the maximum extent applicable. Any payments hereunder that qualify for the "short-term deferral" exception or another exception under section 409A of the Code shall be paid under the applicable exception. All reimbursements provided under this Agreement shall be made or provided in accordance with the requirements of section 409A of the Code, including, where applicable, the requirement that (a) any reimbursement is for expenses incurred during Executive's lifetime (or during a shorter period of time specified in this Agreement), (b) the amount of expenses eligible for reimbursement during a calendar year may not affect the expenses eligible for reimbursement in any other calendar year, (c) the reimbursement of an eligible expense will be made on or before the last day of the taxable year following the year in which the expense is incurred, and (d) the right to reimbursement is not subject to liquidation or exchange for another benefit.
Executive Employment Agmt.




EXHIBIT 10.3

5.Property Rights. Confidentiality. Non-Disparagement, and Restrictive Covenants.

A.The Corporation's Property.

i.    Assignment of Property Rights. Executive must promptly disclose in writing to the Corporation all inventions, designs, discoveries, processes, procedures, methods, and works of authorship, and any improvements or modifications thereon, whether or not patentable or copyrightable, that Executive alone or jointly conceives, makes, discovers, writes, or creates, during working hours or on Executive's own time, during this Agreement's term (the "Works"). Executive hereby assigns to the Corporation all Executive's rights, including copyrights and patent rights, and any applications with respect thereto, to all Works, whether or not marketed or utilized by the Corporation. The Corporation or its designee shall have the sole and exclusive right to take whatever action it deems appropriate to establish and protect its ownership thereof, and Executive must assist the Corporation as it reasonably requires to perfect, protect, and use its rights to the Works. This provision does not apply to any Work for which no Corporation equipment, supplies, facility, or trade secret information was used and: (1) which does not relate directly to the Corporation's business or actual or demonstrably anticipated research or development, or (2) which does not result from any work performed for the Corporation.

ii.    No Removal of Property. Executive may not remove from the Corporation's premises, electronic databases or computer network any Corporation records, documents, data, electronically stored information, or other property, in either original or duplicate form, except as necessary in the ordinary course of the Corporation's business.

iii.    Return of Property. Executive must immediately deliver to the Corporation, upon termination of employment, or at any other time at the Corporation's request, all Corporation property, including records, documents, data (electronically stored or otherwise), and equipment, and all copies of any such property, including any records or data Executive prepared during employment. Additionally, Executive will, if required by the Corporation, provide the Corporation with a signed written statement disclosing and verifying whether Executive has returned all Corporation property previously in Executive's possession, custody, or control. Executive understands that access or use of the Corporation’s documents, equipment, data, electronic databases, computer network and electronically stored information is for the Corporation’s benefit only and that any use of the Corporation’s documents, equipment, data, electronic databases, computer network or electronically stored information or removal or use of information from the Corporation’s documents, equipment, data, electronic databases, computer network or other electronically stored information for any other purpose is unauthorized and prohibited.

B.Confidential Information. Executive has been and will be given access to and provided with sensitive, confidential, proprietary, and trade secret information ("Confidential Information") in the course of Executive's employment which is of unique value to the Corporation. Examples of Confidential Information include,
Executive Employment Agmt.




EXHIBIT 10.3
without limitation, hard copy or electronically stored information, documents or records including any sensitive, confidential, proprietary, or trade secret information related to: inventions, improvements, and designs; new product or marketing plans; business strategies and plans; merger and acquisition targets; financial and pricing information; computer programs, source codes, models, and databases; analytical models; human resources strategies; the skills and compensation of the Corporation’s employees, contractors, and any other service providers of the Corporation; customer lists and information; information received from or about third parties that the Corporation is obligated to keep confidential; supplier and vendor lists; the existence or content of any business discussions, negotiations, or agreements between the Corporation and any Customer or Restricted Prospective Customer, or any other third party; and other information which is not generally available to the public. Executive agrees not to disclose, publish, or use Confidential Information, either during or after Executive's employment with the Corporation, except as necessary to perform Executive's duties or as the Corporation may consent in writing, and for no other purpose. The confidentiality obligations set forth herein shall continue indefinitely, for so long as the Confidential Information remains confidential (and Executive understands that Executive will not be relieved of Executive's obligations if the Confidential Information loses its confidential nature because of a breach of any of Executive's obligations to the Corporation). If this Agreement is enforced by a court applying the law of a jurisdiction where a time frame is required for a non-disclosure provision to be enforceable with respect to information that does not rise to the level of a trade secret, then Executive's obligations with respect to such information will be in effect during Executive's employment with the Corporation and for three years thereafter. Notwithstanding anything to the contrary herein or in any policy of the Corporation, Executive may not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made (i) in confidence to a federal, state or local government official, either directly or indirectly, or to an attorney if such disclosure is made solely for the purpose of reporting or investigating a suspected violation of law or for pursuing an anti-retaliation lawsuit; or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal and Executive does not disclose the trade secret except pursuant to a court order. In the event a disclosure is made, and Executive files a lawsuit against the Corporation alleging that the Corporation retaliated against Executive because of Executive’s disclosure, Executive may disclose the relevant trade secret or confidential information to Executive’s attorney and may use the same in the court proceeding only if (x) Executive ensures that any court filing that includes the trade secret or confidential information at issue is made under seal; and (y) Executive does not otherwise disclose the trade secret or confidential information except as required by court order.

C.Non-Disparagement. Executive agrees not to criticize, make any negative comments about, or otherwise disparage the Corporation or those associated with it, whether orally, in writing, electronically, or otherwise, directly or by implication, to any person or entity, including Corporation customers or agents.

D.Restrictive Covenants. Executive agrees to the restrictive covenants in this Section 5.D in consideration of Executive's employment and/or continued employment and the Corporation providing Executive access to Confidential Information, which consideration Executive agrees is adequate and good. The restrictive covenants in this Section 5.D apply during Executive's employment and for 24 months immediately following the termination of Executive's
Executive Employment Agmt.




EXHIBIT 10.3
employment relationship with the Corporation, regardless of how, when, or why the relationship terminates (the "Restricted Period"). During the Restricted Period, Executive agrees that he will not, without the Corporation's prior written consent, directly or indirectly, engage in any of the following activities:
i.    Non-Solicitation. Executive will not, directly or indirectly:

(a)(1) provide, sell, market, attempt to provide, sell or market, or assist any person or entity in the provision, sale, or marketing of any Competitive Product to any Customer with respect to whom, at any time during the twenty-four (24) months immediately preceding the termination of Executive’s employment with the Corporation, (i) Executive sold, provided, or assisted in or supervised the sale or provision of, any products or services on behalf of the Corporation, (ii) Executive designed, developed or manufactured, or assisted in or supervised the design, development or manufacture of any product on behalf of the Corporation, (iii) Executive had any business contact on behalf of the Corporation, (iv) Executive had any relationship, business development, sales, service or account responsibility (including, without limitation, any supervisory or managerial responsibility) on behalf of the Corporation, or (v) Executive had access to, or gained knowledge of, any Confidential Information concerning the Corporation’s business with such Customer, or (2) otherwise solicit or communicate with any Customer as described in (i) above for the purpose of selling or providing any Competitive Product;

(b)(1) provide, sell, market, attempt to provide, sell or market, or assist any person or entity in the provision, sale or marketing of any Competitive Product to any Restricted Prospective Customer or (2) otherwise solicit or communicate with any Restricted Prospective Customer for the purpose of selling or providing any Competitive Product;

(c)Raid, hire, or employ any individual who is (or who was, within the six (6) months prior to the termination of Executive's employment relationship with the Corporation) a Corporation employee or consultant;

(d)Solicit or recruit for employment any individual who is (or who was, within the six (6) months prior to the termination of Executive's employment relationship with the Corporation) a Corporation employee or consultant;

(e)(1) solicit or recruit for the purpose of hiring or engaging the services of any Restricted Employee; (2) hire, employ or engage the services of any Restricted Employee; (3) assist any person or entity in the recruitment, hiring or engagement of the services of any Restricted Employee; (4) urge, induce or seek to induce any Restricted Employee to terminate their employment with the Corporation; (5) advise, suggest to or recommend to any Competitor that it employ, engage the services of, or seek to employ or engage the services of any Restricted Employee; or (6) interfere with the Corporation’s employment relationship with
Executive Employment Agmt.




EXHIBIT 10.3
any Restricted Employee or any other Corporation employee or consultant;

(f)Induce or influence any Corporation consultant who possesses Confidential Information of the Corporation to terminate his, her, or its employment or other relationship with the Corporation;

(g)Interfere with the legal rights of an employee of the Corporation to seek subsequent employment, unless such employee’s conduct violates any statutory, common law or contractual obligations to the Corporation; or

(h)Assist anyone in any of the activities listed above.

image_1a.jpgii.    Non-Competition. Executive will not:

(a)Perform Competitive Services in the Restricted Area for or on behalf of any Competitor, with respect to Competitive Products; or

(b)Assist anyone in any of the activities listed above.

iii.    Definitions.

(a)"Restricted Area." Because of the nature of the Corporation's business and the nature of Executive's duties and responsibilities for the Corporation, Executive's obligations under this Section 5.D shall apply in each of the following geographic areas, which shall collective be defined as the "Restricted Area": (1) the State of Indiana, (2) Elkhart County and St. Joseph County, Indiana, and the contiguous counties thereto (including the contiguous counties
Executive Employment Agmt.




EXHIBIT 10.3
in the State of Michigan), and (3) an area within a 100 mile radius of any office, facility, and/or manufacturing operation of the Corporation at which or from which Executive performed any executive, operational, managerial, supervisory, and/or related administrative services for or on behalf of the Corporation at any time during the 24 months immediately preceding the termination of Executive's employment relationship with the Corporation.

(b)"Competitor" is any individual or entity (including a Customer) that engages in the business (in whole or in any part) of the Corporation, and which manufactures, markets, sells or distributes products and/or services that are the same as or substantially similar to (in terms of type, brand, or purpose), the products and/or services manufactured, marketed, sold or distributed by the Corporation, as of the date on which Executive's employment relationship with the Corporation terminates.

(c)"Competitive Products" are products and/or services that are the same as or substantially similar to (in terms of type, brand or purpose) the products and/or services offered by the Corporation in the business, including, but not limited to, products: (i) regarding which Executive performed any services for the Corporation at any time during the 24-month period preceding the termination of Executive's employment relationship with the Corporation; and/or (ii) about which Executive had access to any Confidential Information at any time during the 24-month period preceding the termination of Executive's employment relationship with the Corporation.

(d)"Competitive Services" are services that are the same as or substantially similar to (in terms of type or purpose) the services Executive performed for or on behalf of the Corporation at any point during the 24-month period preceding the termination of Executive's employment relationship with the Corporation.

(e)"Customer" means any individual or entity as to which, with, or to whom, within the 24-month period immediately preceding the termination of Executive's employment with the Corporation: (i) any products or services were provided by the Corporation, or (ii) any contract was entered into with the Corporation for the provision of any products or services.

(f)Restricted Prospective Customer” means (i) any person or entity whom Executive, on behalf of the Corporation, solicited, assisted in the solicitation of, or engaged in marketing, sales or business development efforts towards, at any time during the twelve (12) months immediately preceding the termination of Executive’s employment; and/or (ii) any person or entity to whom the Corporation submitted a quotation, bid or sales proposal at any time during the twelve (12) months immediately preceding the termination of Executive’s employment if Executive was involved in or aware of such quotation, bid or sales proposal during Executive’s employment.
Executive Employment Agmt.




EXHIBIT 10.3

(g)Restricted Employee” means any individual employed with the Corporation during Executive’s employment with the Corporation provided the following two conditions are satisfied with respect to such individual: (1) as of the time of the action in question, such individual is then, or within the immediately preceding ninety (90) day period was, employed by the Corporation; and (2) such individual (i) regularly received, helped create or had access to any of the Corporation’s trade secrets and/or Confidential Information during their employment with the Corporation, (ii) possesses or has had access to any of the Corporation’s information that would give a Competitor an unfair advantage if such individual were to be employed by a Competitor, and/or (iii) is or was involved in a software development role, sales role, business development role, managerial role, or customer relationship management role for the Corporation.

iv.     To the extent Executive and the Corporation agree at any time to enter into separate agreements containing restrictive covenants with different or inconsistent terms than those contained herein, Executive and the Corporation acknowledge and agree that such different or inconsistent terms shall not in any way affect, have relevance to, or supersede the restrictive covenants contained herein, and the provisions in any such separate agreements and in this Agreement shall be interpreted in such a manner to give the Corporation its maximum rights and enforceability with respect to the restrictive covenants contained herein and the restrictive covenants contained in any separate agreements to which Executive and the Corporation are parties.

v.     The foregoing shall not be deemed to prevent Executive from investing in securities if such class of securities in which the investment is made is listed on a national securities exchange or is of a company registered under Section 12(g) of the Securities Exchange Act of 1934 and, if the company in which such investment is made competes with the Corporation, such investment represents less than one (1%) percent of the outstanding securities of such class.

Executive has carefully considered the nature and extent of the restrictions placed upon Executive, and the rights and remedies of the Corporation contained in Section 5 of this Agreement, and acknowledges and agrees that they are reasonable as to time, territory, and activity; are designed to eliminate unfair competition to the Corporation; do not stifle Executive's inherent skill and experience or prohibit Executive from being gainfully employed in Executive's chosen profession; are fully required to protect the legitimate interests of the Corporation; and do not confer a benefit upon the Corporation disproportionate to the restrictions imposed upon Executive, or the consideration given therefor.

E.Cooperation and Indemnification. Executive agrees to cooperate fully (i) with the Corporation in the investigation, prosecution, or defense of any potential claims or concerns regarding the Corporation's business about which Executive has relevant
Executive Employment Agmt.




EXHIBIT 10.3
knowledge, including by providing truthful information and testimony as reasonably requested by the Corporation, and (ii) with all government authorities on matters pertaining to any investigation, litigation, or administrative proceeding concerning the Corporation. The Corporation will reimburse Executive for any reasonable travel and out-of-pocket expenses incurred by Executive in providing such cooperation. The Corporation will indemnify Executive, in accordance with the Delaware General Corporation Law, for all claims and other covered matters arising in connection with Executive's employment.

F.Injunctive Relief. Executive agrees that Executive's agreements and undertakings contained herein are valuable and unique and that in the event of a breach, or threatened breach, by Executive of the terms hereof (a) legal remedies (money damages) for any breach of Section 5 will be inadequate, (b) the Corporation will suffer immediate and irreparable harm from any such breach, and (c) the Corporation will be entitled to injunctive relief from a court in addition to any legal remedies the Corporation may seek. If a court determines that Executive has breached any provision of Section 5, Executive agrees to pay to the Corporation its reasonable costs and attorney's fees incurred in enforcing that provision. Any claim Executive has against the Corporation shall not be used by Executive as a defense to the enforcement of the provisions of Section 5 of this Agreement and will not be used to prohibit the Corporation from seeking or obtaining injunctive relief against Executive.

6.Miscellaneous.

A.Recoupment. Any and all payments made or required to be made and pursuant to this Agreement shall be subject to repayment to the Corporation by Executive (and the successors, assigns, heirs, estate, and personal representative of the Executive) pursuant to the terms of any clawback, recoupment, or other policy implemented from time to time by the Corporation, as amended (the "Recoupment Policy"). As additional consideration for any payment or award granted to Executive, Executive agrees to be bound by and subject to the Recoupment Policy as in effect at any time and from time to time, as amended (whether before, at, or after the granting or payment of any award).

B.Adequacy of Consideration. Executive acknowledges and agrees that he has received, prior to or contemporaneously with the Effective Date, adequate consideration from the Corporation to enter into this Agreement.

C.Survival. The provisions of Sections 5 and 6 shall survive any termination of this Agreement. The parties also agree that Executive's obligations under Section 5 remain in effect regardless of any reason that his employment with the Corporation ends.

D.Tax Withholding. All compensation payable under this Agreement will be subject to applicable tax withholding and other required or authorized deductions.

Executive Employment Agmt.




EXHIBIT 10.3
E.Compensation Subject to Plan. All compensation, in whatever form, payable pursuant to this Agreement shall be subject in all respects to the terms, provisions, and conditions of the LCI Industries 2018 Omnibus Incentive Plan, as amended and restated from time to time.

F.Notices. For all purposes of this Agreement, all communications, including without limitation notices, consents, requests, or approvals, required or permitted to be given hereunder will be in writing and will be deemed to have been duly given when hand delivered or dispatched by electronic facsimile transmission (with receipt thereof orally confirmed), or five business days after having been mailed by United States registered or certified mail, return receipt requested, postage prepaid, or three business days after having been sent by a nationally recognized overnight courier service such as FedEx or UPS, addressed to the Corporation (to the attention of the Secretary of the Corporation) at its principal executive office and to Executive at Executive's principal residence, or to such other address as any party may have furnished to the other in writing and in accordance herewith, except that notices of changes of address will be effective only upon receipt.

G.Assignment. This Agreement shall inure to the benefit of and be binding upon the Corporation, its successors, and assigns, and the Executive, his heirs, executors, administrators, and legal representatives. Executive may not assign this Agreement. The Corporation may assign this Agreement. This Agreement shall not be terminated, voluntarily or involuntarily, by the liquidation or dissolution of the Corporation or by the merger or consolidation of the Corporation with or into another corporation. Any successor to the Corporation will be deemed to be the Corporation under this Agreement.

H.Entire Agreement: Amendment. This Agreement contains the parties' entire agreement regarding its subject matter. Except as modified by a court of competent jurisdiction pursuant to the blue pencil doctrine or otherwise, this Agreement may only be amended in a writing signed by the parties. This Agreement supersedes any and all prior oral or written employment agreements (including letters and memoranda) between Executive and the Corporation or its predecessors. This Agreement does not supersede the terms of any stock option, restricted stock, or stock appreciation rights plan or award. Nothing in this Agreement, nor any fixing of compensation in the form of base salary, bonus, stock-based awards, deferred compensation, or otherwise, shall prevent the Corporation from granting to Executive additional compensation in the form of cash, salary increase, stock-based awards, deferred compensation, or otherwise.

I.Choice of Law. This Agreement shall be governed by the internal laws of the State of Indiana without giving effect to principles of conflicts of law. Each party hereto hereby irrevocably submits to the exclusive jurisdiction and venue of the United States District Court located in Indianapolis, Indiana over any suit, action, or proceeding arising out of or relating to this Agreement. Each party hereby irrevocably waives to the fullest extent permitted by law, (i) the right to a trial by jury; (ii) any objection that they may now or hereafter have to the venue of any such suit, action, or proceeding brought in any such court; or (iii) any claim that any such suit, action, or proceeding has been brought in an inconvenient forum. Final judgment in any suit, action, or proceeding brought in any such court shall be conclusive and binding upon each party duly served with process therein and
Executive Employment Agmt.




EXHIBIT 10.3
may be enforced in the courts of the jurisdiction of which either party or any of their property is subject, by a suit upon such judgment.

J.Waivers. No party's failure to exercise, or delay in exercising, any right or remedy under this Agreement will be a waiver of such right or remedy, nor will any single or partial exercise of any right or remedy preclude any other or further exercise of such right or remedy.

K.Headings. The headings of this Agreement are for the convenience of reference only and shall not affect in any manner any of the terms and conditions hereof.

L.Narrowed Enforcement and Severability. If any provision or clause of this Agreement, or any portion thereof, shall be held by any court or other tribunal of competent jurisdiction to be illegal, invalid, or unenforceable in such jurisdiction, the remainder of such provision shall not thereby be affected and shall be given full force and effect, without regard to the invalid portion. It is the intention of the parties that each of the restrictions in Section 5.D be severable, and, if any court construes any provision or clause of this Agreement, or any portion thereof, to be illegal, invalid, or unenforceable because of the duration of such provision or the area or matter covered thereby, such court shall reduce the duration, area, or matter of such provision, and in its reduced form, such provision shall then be enforceable and shall be enforced.

M.Attorney' s Fees. In the event of any proceeding involving a claim or dispute arising under this Agreement, the prevailing party (by motion, on the merits, or otherwise) shall be entitled to recover, in addition to any remedy awarded in such proceeding, all costs and expenses, including actual attorney's fees, incurred by the prevailing party in such proceeding.

N.Payment of Deferred Compensation - Section 409A. To the extent applicable, it is intended that the compensation arrangements under this Agreement be in full compliance with Section 409A. This Agreement shall be construed in a manner to give effect to such intention. In no event whatsoever shall the Corporation be liable for any tax, interest, or penalties that may be imposed on Executive under Section 409A. The Corporation shall have no obligation to indemnify or otherwise hold Executive harmless from any such taxes, interest, or penalties, or from liability for any damages related thereto.

Executive Employment Agmt.




EXHIBIT 10.3

O.     Electronic Transmission/Counterparts. The executed version of this Agreement may be delivered by facsimile or email, and upon receipt, such transmission shall be deemed delivery of an original. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original, and all of which together will constitute one document.


LIPPERT COMPONENTS, INC.            EXECUTIVE


By:                                By:                    


Executive Employment Agmt.

EXHIBIT 31.1
 
CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO 13a-14(a)
UNDER THE SECURITIES EXCHANGE ACT OF 1934
 
I, Jason D. Lippert, Chief Executive Officer, certify that:

1.I have reviewed this quarterly report on Form 10-Q of LCI Industries;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
 
 
Date: August 2, 2022
By /s/ Jason D. Lippert
Jason D. Lippert, Chief Executive Officer



EXHIBIT 31.2
 
CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO 13a-14(a)
UNDER THE SECURITIES EXCHANGE ACT OF 1934
 
I, Brian M. Hall, Chief Financial Officer, certify that:

1.I have reviewed this quarterly report on Form 10-Q of LCI Industries;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
 
 
Date: August 2, 2022
By /s/ Brian M. Hall
Brian M. Hall, Chief Financial Officer



EXHIBIT 32.1
 
 
CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO 18 U.S.C.
SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002
 
 
 
In connection with the quarterly report on Form 10-Q of LCI Industries (the “Company”) for the period ended June 30, 2022, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Jason D. Lippert, Chief Executive Officer of the Company, hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
 
A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.
 
 
By /s/ Jason D. Lippert
Chief Executive Officer
Principal Executive Officer
August 2, 2022
 


EXHIBIT 32.2
 
 
CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO 18 U.S.C.
SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002
 
 
 
In connection with the quarterly report on Form 10-Q of LCI Industries (the “Company”) for the period ended June 30, 2022, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Brian M. Hall, Chief Financial Officer of the Company, hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
 
A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.
 
 
By /s/ Brian M. Hall
Chief Financial Officer
Principal Financial Officer
August 2, 2022