Exhibit 4.4
AZZ incorporated
FORM OF
PERFORMANCE AWARD
AGREEMENT
This Performance Award Agreement
(“Agreement”) is effective as of
, 2006, between AZZ incorporated, a Texas corporation (the
“Company”) and
(the “Grantee”).
WHEREAS, the Company has adopted the
AZZ incorporated 2005 Long-Term Incentive Plan (the
“Plan”), pursuant to which the Company may grant the
right to receive shares of Common Stock, $1.00 par value per share
(the “Common Stock”), shares of Common Stock which are
restricted as to transfer (shares so restricted hereinafter
referred to as “Restricted Stock”), or cash of an
equivalent value, or any combination thereof as the Compensation
Committee of the Board of Directors of the Company (the
“Compensation Committee”) may determine (collectively,
the “Performance Shares”) to any employee or director
of the Company; and
WHEREAS, pursuant to the Plan, the
Compensation Committee may grant the right to receive a fixed
dollar amount payable in cash, shares of Common Stock, Restricted
Stock or any combination thereof, as the Compensation Committee may
determine (collectively, the “Performance Units” and
together with Performance Shares, the “Performance
Awards”) to any employee or director of the Company;
and
WHEREAS, the Company desires to
grant to the Grantee a Performance Award as provided for herein to
encourage Grantee’s efforts toward the continuing success of
the Company.
NOW, THEREFORE, in consideration of
the recitals and the mutual agreements herein contained, the
parties hereto agree as follows:
1. [Performance
Shares/Performance Units].
(a) Your right to receive all or any
portion of the [Performance Shares/Performance Units] will be
contingent upon the achievement of certain management objectives
(the “Management Objectives”). The achievement of the
Management Objectives will be measured during the period from [
, 2005 through December 31, 2007] (the “Performance
Period”).
(b) [The Management Objectives for
the Performance Period will be based on Cash Flow (“Cash
Flow”), Return on Invested Capital (“ROIC”) and
the level of EBITDA in relation to debt (“Debt to
EBITDA”). Each of the Management Objectives will be weighted
thirty three and one-third percent (33 1 / 3
%) and,
therefore:
(i) thirty three and one-third
percent (33 1 / 3
%) of the total number
of [Performance Shares/Performance Units] will be based on Cash
Flow (the “Cash Flow [Performance Shares/Performance
Units]”);
(ii) thirty three and one-third
percent (33 1 / 3
%) of the total number
of [Performance Shares/Performance Units] will be based on ROIC
(the “ROIC [Performance Shares/Performance Units]”);
and
(iii) thirty three and one-third
percent (33 1 / 3
%) of the total number
of [Performance Shares/Performance Units] will be based on Debt to
EBITDA (the “Debt to EBITDA [Performance Shares/Performance
Units]”).]
2. Earning of [Performance
Shares/Performance Units].
(a) The Cash Flow [Performance
Shares/Performance Units].
(i) If, upon the conclusion of the
Performance Period, Cash Flow equals or exceeds [
], but is less than [
], a proportionate number of the Cash Flow [Performance
Shares/Performance Units] shall become earned, as determined by
mathematical interpolation and rounded up to the nearest whole
share.
(ii) If, upon the conclusion of the
Performance Period, Cash Flow equals or exceeds [
], but is less than [
], a proportionate number of the Cash Flow [Performance
Shares/Performance Units] shall become earned, as determined by
mathematical interpolation and rounded up to the nearest whole
share.
(iii) If, upon the conclusion of the
Performance Period, Cash Flow equals or exceeds [
], 200% of the Cash Flow [Performance Shares/Performance Units]
shall become earned.
(b) The ROIC [Performance
Shares/Performance Units].
(i) If, upon the conclusion of the
Performance Period, the Company’s ROIC exceeds the
Company’s peer group ROIC by at least one percentage point
and the Company’s ROIC is at least [
], a percentage of the ROIC [Performance Shares/Performance Units]
shall become earned. The actual number of ROIC [Performance
Shares/Performance Units] earned will be determined by mathematical
interpolation and rounded up to the nearest whole share.
(ii) Notwithstanding (i) above,
for every whole percentage point greater than one that the
Company’s ROIC Change surpasses or falls short of the
Company’s Peer ROIC Change, the number of ROIC [Performance
Shares/Performance Units] that become earned will be modified such
that an additional fifteen (15) percentage points will be
added or subtracted, as the case may be, from the percentage that
becomes earned.
(A) For purposes of this
Section 2(b), “Company ROIC Change” means the
increase or decrease in the Company’s ROIC from fiscal year
[2005 to fiscal year 2007].
(B) For purposes of this
Section 2(b), “Company ROIC Peer Change” means the
increase or decrease in the total ROIC for the Company’s peer
group from fiscal year 2005 to fiscal year 2007.
(c) The Debt to EBITDA [Performance
Shares/Performance Units].
(i) If, upon the conclusion of the
Performance Perio
