Cooper US, Inc. Executive Stock Incentive Agreement
EXHIBIT 10.1
Xxxxxx US, Inc.
Executive Stock Incentive Agreement
Executive Stock Incentive Agreement
This Agreement is made as of the 13th day of February 2007 between Xxxxxx US, Inc., a
Delaware corporation, having its principal place of business in Houston, Texas (the “Company”) and
(NAME), an Executive of the Company (“Executive”). All capitalized terms used in this Agreement
are as defined in the Xxxxxx Industries Stock Incentive Plan (the “Plan”), unless otherwise defined
in this Agreement.
1. Performance Share Award
(a) Performance Period. For purposes of this Agreement, the “Performance Period”
shall be January 1, 2007 to December 31, 2009.
(b) Performance Share Grant. Pursuant to Section IX of the Plan and subject to
Paragraph 7 of this Agreement, the Company hereby grants to the Executive, as of the date hereof,
an award of Performance Shares that may be earned based on the financial performance of the Company
during the Performance Period, subject to the restrictions and conditions set forth in this
Agreement (“Performance Share Grant”). The Committee has established Performance Goals such that
if the Company achieves a cumulative annual growth rate of earnings per share (“EPS”) for the
Performance Period of four (4) percent or greater, then the Executive will be issued Performance
Shares in accordance with the following chart:
| Fully Diluted EPS | ||||||||||||
| Annual EPS | Cumulative Total Over | Performance Shares | ||||||||||
| Performance Goal | Growth Rate | Performance Period | That May Be Earned | |||||||||
Threshold |
4 | % | $ | 16.75 | ||||||||
Good |
8 | % | $ | 18.09 | ||||||||
Target |
12 | % | $ | 19.50 | ||||||||
Maximum |
16 | % | $ | 20.98 | ||||||||
The number of shares appearing under the heading “Performance Shares That May Be Earned” shall
constitute the number of Performance Shares which may be earned by the Executive based upon achievement of that specific Performance Goal as established by the Committee
based on cumulative EPS performance during the Performance Period (Threshold,
Good, Target or
Maximum). In the event the Company’s actual annual growth rate of EPS for the Performance Period
exceeds the Threshold level of 4% but is lower than the Maximum level of 16%, the number of
Performance Shares earned by the Executive shall be determined by interpolation. In the event the
Company’s actual annual growth rate of EPS for the Performance Period is below the Threshold (4%)
level, no Performance Shares will be earned. The Maximum number of Performance Shares will be
earned if the annual growth rate of EPS equals or exceeds 16% during the Performance Period.
At the end of the Performance Period, the Committee shall determine the Performance Goal
achieved and the number of Performance Shares, if any, earned by the Executive. Except for shares
withheld by the Company as provided in Paragraph 4 or shares the receipt of which has been deferred
as provided in Paragraph 5, the Company shall then cause its parent, Xxxxxx Industries, Ltd., to
issue a stock certificate or book entry shares in the Executive’s name for the number of shares of
Common Stock equal to the Performance Shares earned by the Executive upon lapse of the forfeiture
restrictions set forth in Paragraph 3(a). The Company shall then provide stock certificate or
book-entry shares to the Executive.
2. Dividends. Upon distribution of earned Performance Shares to Executive, the
Company shall pay to the Executive in cash an amount equal to the aggregate amount of cash
dividends that the Executive would have received had the Executive been the owner of record of all
such earned Performance Shares, including shares withheld as provided under Paragraph 4, if any,
from the effective date of this Agreement to the date of distribution.
3. Restrictions and Limitations. The Executive hereby accepts the Performance Share
Grant and agrees to the following restrictions and conditions.
(a) Forfeiture. Except as provided in (b) below, if the Executive’s active
employment with the Company terminates for any reason prior to the effective date upon which the
Committee determines the number of Performance Shares, if any, earned by the Executive,
all earned and unearned Performance Shares granted under this Agreement shall be forfeited by the
Executive and this Performance Share Grant shall be null and void.
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(b) Termination Upon Death or Disability. In the event of the Executive’s death or
permanent and total disability under Xxxxxx’x Group Long-Term Disability Benefit Plan (or such
other disability program or plan in which the Executive participates) on or after January 1, 2009,
the Executive or his heirs or beneficiaries shall receive a pro-rata share of the Performance
Shares which would have been earned by the Executive under this Agreement had he or she remained
actively employed throughout the Performance Period. In determining the pro-rata Performance
Shares for which the Executive or his heirs or beneficiaries may be eligible, the Company will
multiply the total Performance Shares earned during the Performance Period by a fraction the
numerator of which is the months in the Performance Period during which Executive was actively
employed and the denominator is thirty-six (36). Any Performance Shares earned and awarded under
this provision shall be approved by the Committee and distributed at the conclusion of the
Performance Period.
(c) Limitations on Transferability. The Executive shall not sell, exchange,
transfer, pledge, hypothecate or otherwise dispose of this Performance Share Grant prior to the
conclusion of the Performance Period and distribution of earned Performance Shares in accordance
with Paragraph 1 of this Agreement.
4. Tax. Upon the issuance of Common Shares to the Executive for Performance Shares
earned under this Agreement, the Executive shall pay the Company any taxes required to be withheld
by reason of the receipt of compensation resulting from the issuance of such Common Shares. In
lieu thereof, the Company shall have the right to retain, or the Executive may direct the Company
to retain, a sufficient number of Common Shares to satisfy the Company’s withholding obligations,
provided the value of the Common Shares used to satisfy the withholding obligations does not exceed
the minimum required tax withholding for the transaction. The value of any Common Shares used to
satisfy the tax withholding requirement shall be determined by the closing price of the Common
Shares on the New York Stock Exchange on the date the restrictions lapse (or if shares are not
traded on the Exchange on such date, then on the immediately preceding trading date).
5. Election to Defer Shares. The Committee has determined that the Executive may
elect to defer the issuance and receipt of Common Shares for all or any portion of the
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Performance
Shares earned under this Agreement until a specific time or event specified by the Executive at the
time of the election to defer. Where an election to defer is in place, the Company shall credit to
an account maintained on behalf of such Executive (the “Executive Deferred Account”) the shares
deferred. The Executive Deferred Account shall also be credited with all dividends or other
distributions that the Executive would have received had he or she been the owner of record of such
deferred shares during the deferral period. Accrued dividends credited to the Executive Deferred
Account shall bear interest equal to the average quarterly prime rate of interest charged by
X.X.Xxxxxx Xxxxx Bank. Distribution of deferred shares will be made in accordance with the terms
and conditions of the Company’s Stock Incentive Deferral Plan. The time and form of distribution
of the shares and dividends and interest thereon shall be designated by the Executive at the time
the deferral election is made. Until the deferred shares are issued to the Executive, the
Executive shall have no other rights as a shareholder of Xxxxxx Industries, Ltd. with respect to
such deferred shares.
A deferral election by an Executive hereunder must be made in writing to the Company on or
before December 31 of the year prior to which the Performance Period concludes, shall specify the
percentage of Performance Shares earned, if any, to be deferred and shall be irrevocable.
6. Change in Control. In the event of a Change in Control, the Performance Share
Grant shall be deemed earned at the Target level, all restrictions on those Performance Shares
shall immediately lapse and distribution of the Target level of Performance Shares shall be
governed by the terms of the Plan.
7. Consideration. The parties agree that the consideration for any issuance of Common
Shares for Performance Shares earned hereunder shall be past services by the Executive having a
value not less than the par value of such Common Shares.
8. Plan Incorporated. In order to be a participant in the Plan, the participant shall
execute the Executive Employment Agreement (the “Agreement”), incorporated herein by reference, in
which the participant agrees to the terms and conditions set forth in the Agreement. Participant’s
failure to execute the Agreement for any reason will render the participant
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ineligible to
participate in the Plan. The Executive acknowledges receipt of a copy of the Plan, which is
incorporated by reference into this Agreement. The Executive agrees that this Award shall be
subject to all of the terms and provisions of the Plan.
9. Binding Effect. This Agreement shall be binding upon and inure to the benefit of
any successors to the Company and all persons lawfully claiming under the Executive.
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by an officer
thereunto duly authorized, and the Executive has executed this Agreement, all as of the date first
above written.
| XXXXXX US, INC. |
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| By: | ||||
| Xxxx X. Xxxxxxx | ||||
| Vice President, Global Compensation & International Human Resources |
||||
| EXECUTIVE |
||||
| By: | ||||
| (name) | ||||
| (title) | ||||
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