Exhibit 10.10
ANDREW CORPORATION
LONG-TERM INCENTIVE PLAN
SECTION 1.
PURPOSE: The purpose of the
Andrew Corporation Long-Term Incentive Plan is to provide certain
employees and consultants of Andrew Corporation and its Affiliates
(as hereinafter defined) and members of the Board (as hereinafter
defined) with the opportunity to receive stock-based and other
long-term incentive grants in order to attract and retain qualified
individuals and to align their interests with those of
stockholders.
SECTION
2. EFFECTIVE
DATE: This Plan will become
effective as of November 17, 2004, subject to the approval of
the stockholders at the Annual Meeting to be held on
February 8, 2005. Unless sooner terminated as provided herein,
the Plan shall terminate ten years from November 17, 2004.
After the Plan is terminated, no future Awards may be granted under
the Plan, but Awards previously granted shall remain outstanding in
accordance with their applicable terms and conditions.
SECTION 3.
DEFINITIONS: As used in this Plan,
unless the context otherwise requires, each of the following terms
shall have the meaning set forth below.
(a)
“Affiliate”
shall mean any entity that, directly or indirectly, controls, is
controlled by, or is under common control with, the
Company.
(b)
“Award” shall
mean a grant of an Option, SAR, Restricted Stock Award, Performance
Award, or Other Stock Award pursuant to the Plan, which may, as
determined by the Committee, be in lieu of other compensation owed
to a Participant.
(c)
“Award
Agreement” shall mean an agreement, either in written or
electronic format, in such form and with such terms and conditions
as may be specified by the Committee, which evidences the terms and
conditions of an Award.
(d)
“Beneficiary”
means the person or entity (including a trust or the estate of the
Participant) designated by the Participant to succeed to any rights
that he or she may have in Awards at the time of death. No such
designation, or any revocation or change thereof, shall be
effective unless made in writing by the Participant on a form
provided by the Company and delivered to the Company prior to the
Participant’s death. If, on the death of a Participant, there
is no living person or entity in existence so designated, the term
“Beneficiary” shall mean the legal representative of
the Participant’s estate.
(e)
“Board of
Directors” or “Board” shall mean the board of
directors of the Company.
(f)
“Change in
Control” means the happening of any of the following
events:
(i)
the merger or
consolidation of the Company with any other corporation following
which the holders of the Company’s common stock immediately
prior thereto hold less than 60% of the outstanding common stock of
the surviving or resulting entity;
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(ii)
the sale of all or
substantially all of the assets of the Company to any person or
entity other than a wholly-owned subsidiary;
(iii)
any person or group of
persons acting in concert, or any entity, becomes the beneficial
owner, directly or indirectly, of more than 20% of the
Company’s outstanding common stock, other than an acquisition
of more than 20%, in one or more transactions, of the
Company’s outstanding common stock by (a) a passive
institutional investor where such investor is eligible pursuant to
Rule 13d-1(b) of the Securities Exchange Act of 1934 (the
“Exchange Act”) to, and does, file a report of
ownership on Schedule 13G with the Securities and Exchange
Commission, (b) a trustee or other fiduciary of an employee
benefit plan maintained by the Company, or (c) a corporation
owned directly or indirectly by the stockholders of the Company in
substantially the same proportions as their ownership of the
Company;
(iv)
those individuals who, as
of the close of the most recent annual meeting of the
Company’s stockholders, are members of the Board (the
“Existing Directors”) cease for any reason to
constitute more than 50% of the Board. For purposes of the
foregoing, a new director will be considered an Existing Director
if the election, or nomination for election by the Company’s
stockholders, of such new director was approved by a vote of a
majority of the Existing Directors. No individual shall be
considered an Existing Director if such individual initially
assumed office as a result of either an actual or threatened
election contest subject to Rule 14a-11 under the Exchange Act
or other actual or threatened solicitation of proxies by or on
behalf of anyone other than the Board of Directors, including by
reason of any agreement intended to avoid or settle any election
proxy contest; or
(v)
the stockholders of the
Company adopt a plan of liquidation.
(g)
“Code” shall
mean the Internal Revenue Code of 1986, as amended from time to
time, and any references to a particular section of the Code shall
be deemed to include any successor provision thereto.
(h)
“Committee”
shall mean the Compensation and Human Resources Committee of the
Board or such other committee of the Board of Directors, which
shall consist solely of two or more “outside directors”
within the meaning of Section 162(m) of the Code and
“non-employee directors” within the meaning of
Securities and Exchange Commission Rule 16b-3 promulgated
under Section 16 of the Securities Exchange Act of 1934, as
amended, or any such successor provision thereto.
(i)
“Company”
shall mean Andrew Corporation, a Delaware corporation.
(j)
“Consultant”
shall mean any person engaged by the Company or an Affiliate to
render services to such entity as a consultant or
advisor.
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(k)
“Disability”
shall mean that a Participant is eligible for Social Security
disability benefits or disability benefits under the
Company’s long-term disability plan, based upon a
determination by the Committee that the condition arose prior to
termination of employment.
(l)
“Eligible
Director” shall mean a member of the Board who is not an
officer or employee of the Company or any of its
Affiliates.
(m)
“Eligible
Employee” shall mean an employee of the Company or any
Affiliate.
(n)
“Exercise
Price” shall mean an amount, as determined by the Committee,
at which an Option or SAR can be exercised by a Participant, which
amount shall not be less than the Fair Market Value of a Share on
the date such Award is granted, unless such Option or SAR is
granted pursuant to an assumption or substitution of another option
in a manner that satisfies the requirements of
Section 424(a) of the Code.
(o)
“Fair Market
Value” shall mean the average of the high and low sale prices
for a Share as reported on the NASDAQ National Market system or, if
no sales were reported for such date, on the next preceding date
for which such sales were reported.
(p)
“Incentive Stock
Option” shall mean an Option which is intended to meet the
requirements set forth in Section 422 of the Code and which
only Eligible Employees are eligible to receive.
(q)
“Nonqualified Stock
Option” shall mean an Option not intended to qualify as an
Incentive Stock Option.
(r)
“Option” shall
mean the right to purchase a Share granted pursuant to
Section 8, which may take the form of either an Incentive
Stock Option or a Nonqualified Stock Option.
(s)
“Other Stock
Award” shall mean an Award of Shares or Awards that are
valued in whole or in part, or that are otherwise based on, Shares,
including but not limited to dividend equivalents or amounts which
are equivalent to all or a portion of any federal, state, local,
domestic, or foreign taxes relating to an Award, which may be
payable in Shares, cash, other securities, or any other form of
property as the Committee shall determine, subject to the terms and
conditions set forth by the Committee and granted pursuant to
Section 12.
(t)
“Participant”
shall mean an Eligible Employee or Consultant selected by the
Committee to receive Awards under the Plan or an Eligible Director
who receives an Award under Appendix A.
(u)
“Performance
Awards” shall mean Awards of Performance Shares or
Performance Units.
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(v)
“Performance
Goal(s)” shall mean the level or levels of Performance
Measures established by the Committee pursuant to
Section 7.
(w)
“Performance
Measures” shall mean any of the following performance
criteria, either alone or in any combination, which may be
expressed with respect to the Company or one or more operating
units or groups, as the Committee may determine: cash flow; cash
flow from operations; total earnings; earnings per share, diluted
or basic; earnings per share from continuing operations, diluted or
basic; earnings before interest and taxes; earnings before
interest, taxes, depreciation, and amortization; earnings from
operations; net asset turnover; inventory turnover; capital
expenditures; net earnings; operating earnings; gross or operating
margin; debt; working capital; return on equity; return on net
assets; return on total assets; return on capital; return on
investment; return on sales; net or gross sales; market share;
economic value added; cost of capital; change in assets; expense
reduction levels; debt reduction; productivity; delivery
performance; safety record; stock price; and total stockholder
return. Performance Measures may be determined on an absolute basis
or relative to internal goals or relative to levels attained in
prior years or related to other companies or indices or as ratios
expressing relationships between two or more Performance Measures.
The Committee shall provide how any Performance Measure shall be
adjusted to the extent necessary to prevent dilution or enlargement
of any Award as a result of extraordinary events or circumstances,
as determined by the Committee, or to exclude the effects of
extraordinary, unusual, or non-recurring items; changes in
applicable laws, regulations, or accounting principles; currency
fluctuations; discontinued operations; non-cash items, such as
amortization, depreciation, or reserves; asset impairment; or any
recapitalization, restructuring, reorganization, merger,
acquisition, divestiture, consolidation, spin-off, split-up,
combination, liquidation, dissolution, sale of assets, or other
similar corporate transaction; provided, however, that no such
adjustment will be made if the effect of such adjustment would
cause the Award to fail to qualify as “performance based
compensation” within the meaning of
Section 162(m) of the Code.
(x)
“Performance
Period” shall mean a period established by the Committee
pursuant to Section 7 at the end of which one or more
Performance Goals are to be measured.
(y)
“Performance
Share” shall mean an Award denominated in Shares, which is
earned during a specified period subject to the terms and
conditions as determined by the Committee and granted pursuant to
Section 11.
(z)
“Performance
Unit” shall mean an Award denominated in units having a value
in dollars or such other currency, as determined by the Committee,
which is earned during a specified period subject to the terms and conditions as
determined by the Committee and granted pursuant to
Section 11.
(aa)
“Plan” shall
mean the Andrew Corporation Long-Term Incentive Plan, as amended
and restated from time to time.
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(bb)
“Restricted
Stock” shall mean an Award of Shares, subject to such terms
and conditions as determined by the Committee and granted pursuant
to Section 10.
(cc)
“Restricted Stock
Award” shall mean an Award consisting of Restricted Stock or
Restricted Stock Units.
(dd)
“Restricted Stock
Unit” shall mean an Award consisting of a bookkeeping entry
representing an amount equivalent to the Fair Market Value of one
Share, payable in cash or Shares, and representing an unfunded and
unsecured obligation of the Company, subject to such terms and
conditions as determined by the Committee and granted pursuant to
Section 10.
(ee)
“Retirement”
shall mean termination of an Eligible Employee’s employment
with the Company and its Affiliates for retirement purposes if such
termination occurs (1) on or after his or her sixty-fifth
birthday; or (2) on or after his or her fifty-fifth birthday
with the written consent of the Chief Executive Officer of the
Company or, in the case of the Chief Executive Officer’s
retirement, with the consent of the Committee. In the case of an
Eligible Director, “Retirement” shall be determined by
the Committee in its discretion. In no event shall termination of a
Consultant’s services with the Company and Affiliates be
treated as a Retirement under the Plan.
(ff)
“Shares” shall
mean shares of common stock, $0.01 par value, of the
Company.
(gg)
“Stock Appreciation
Right” or “SAR” shall mean an Award, which
represents the right to receive the difference between the Fair
Market Value of a Share on the date of exercise and an Exercise
Price, payable in cash or Shares, subject to such terms and
conditions as determined by the Committee and granted pursuant to
Section 9.
SECTION 4.
ADMINISTRATION: Subject to the express provisions
of this Plan, the Committee shall have authority to interpret the
Plan, to prescribe, amend, and rescind rules and regulations
relating to it, and to make all other determinations deemed
necessary or advisable for the administration of the Plan. In
exercising its discretion, the Committee may use such objective or
subjective factors as it determines to be appropriate in its sole
discretion. The determinations of the Committee pursuant to its
authority under the Plan shall be conclusive and binding. The
Committee may delegate to one or more officers of the Company the
authority, subject to the terms and conditions as the Committee
shall determine, to grant Awards to employees who are not officers
or members of the Board for purposes of Section 16 of the
Securities Exchange Act of 1934, as amended.
SECTION 5. SHARES
AVAILABLE FOR AWARDS
(a)
Subject to adjustment as
provided in Section 5(g), the maximum number of Shares
available for issuance under the Plan shall be
4,000,000.
(b)
If any Shares are subject
to an Award that is forfeited, settled in cash, expires, or is
otherwise terminated without the issuance of Shares, such Shares
shall again be
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available for Awards under the Plan. Any Shares
that are tendered by the Participant or retained by the Company as
full or partial payment to the Company for the purchase of an Award
or to satisfy tax withholding obligations in connection with an
Award shall be available for Awards under the Plan. Upon payment of
Shares upon the exercise of a SAR, the number of Shares available
for issuance under the Plan shall be reduced only by the number of
actual Shares issued in such payment.
(c)
Unless otherwise
determined by the Committee, Awards that are designed to operate in
tandem with other Awards shall not be counted against the maximum
number of Shares available under Section 5(a) in order to
avoid double counting.
(d)
Notwithstanding the
foregoing, the maximum number of Shares that may be issued upon the
exercise of Incentive Stock Options shall equal the aggregate
number of Shares stated in Section 5(a), subject to adjustment
as provided in Section 5(f) to the extent that such
adjustment does not affect the ability to grant or the
qualification of Incentive Stock Options under the Plan.
(e)
Any Shares issued under
the Plan shall consist, in whole or in part, of authorized and
unissued Shares, Shares purchased in the open market or otherwise,
Shares in treasury, or any combination thereof, as the Committee
or, as appropriate, the Board may determine.
(f)
In the event of any
merger, reorganization, consolidation, recapitalization, stock
dividend, stock split, reverse stock split, spin-off, combination,
repurchase or exchange of Shares or other securities of the
Company, or similar corporate transaction, as determined by the
Committee, the Committee shall, in such manner as it may deem
equitable and to prevent dilution or enlargement of the benefits or
potential benefits intended to be made available under the Plan,
adjust the number and type of Shares available for Awards under the
Plan, the number and type of Shares subject to outstanding Awards,
and the Exercise Price with respect to any Award; provided,
however, that any fractional Share resulting from an adjustment
pursuant to this Section 5(f) shall be rounded to the
nearest whole number.
SECTION 6.
ELIGIBILITY: The Committee from time
to time may designate which Eligible Employees and Consultants
shall become Participants under the Plan. Eligible Directors shall
be eligible to receive Awards only in accordance with
Appendix A of the Plan.
SECTION 7. CODE
SECTION 162(m) PROVISIONS
(a)
Notwithstanding any other
provision of the Plan, if the Committee determines at the time an
Award is made to a Participant that such Participant is or may be
for the tax year in which the Company would claim a tax deduction
in connection with the Award, a Covered Employee (as that term is
defined in Section 162(m) of the Code), the Committee may
provide, in writing, that this Section 7 is applicable to such
Award under such terms and conditions as the Committee may
specify.
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(b)
Notwithstanding any other
provision of the Plan other than Section 5(f), if the
Committee provides that this Section 7 is applicable to a
particular Award, no Participant shall receive such an Award or
Awards having an aggregate Option/SAR Value, Performance Share
Value, and Performance Unit Value (as hereinafter defined) of
greater than $5,000,000 for any fiscal year of the Company, where:
(i) the Option/SAR Value shall mean the Fair Market Value of
the number of Shares underlying an Award of Options in any fiscal
year of the Company or the Fair Market Value of a number of Shares
equal to the number of SARs awarded in any fiscal year of the
Company, with such Fair Market Value determined as of the date of
grant of each Award, multiplied by 50%; (ii) the Performance
Share Value shall mean the Fair Market Value, as of the date of
grant of each such Award, of the maximum number of Shares that the
Participant could receive from an Award of Performance Shares
granted in the fiscal year; provided, however, that such number of
Shares shall be divided by the number of full fiscal years of the
Company contained in the Performance Period of a particular Award,
and provided further, that if any other Awards of Performance
Shares are outstanding for such Participant for a given fiscal
year, the Performance Share Value shall be increased for each such
given fiscal year by the Fair Market Value of Shares that could be
received by the Participant under all such other Awards calculated
on the date each such Award was granted, divided, for each such
Award, by the number of full fiscal years of the Company contained
in the Performance Period of each such outstanding Award; or
(iii) the Performance Unit Value shall mean the maximum dollar
value that the Participant could receive from an Award of
Performance Units granted in the fiscal year, provided, however,
that such amount shall be divided by the number of full fiscal
years of the Company contained in the Performance Period of a
particular Award, and provided further, that if any other Awards of
Performance Units are outstanding for such Participant for a given
fiscal year, the Performance Unit Value shall be increased for each
such given fiscal year by the amount that could be received by the
Participant under all such other Awards, divided, for each such
Award, by the number of full fiscal years of the Company contained
in the Performance Period of each such outstanding Award; provided,
however, that the limitations set forth in this
Section 7(b) shall be subject to adjustment under
Section 5(f) of the Plan only to the extent that such
adjustment does not affect the status of any Award intended under
this Section 7 to qualify as “performance based
compensation” under Section 162(m) of the Code. If
an Option i
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