EXHIBIT 10.1
PERFORMANCE SHARE AWARD AGREEMENT
THIS AGREEMENT, dated as of the ____ day of _______________, between
DYCOM INDUSTRIES, INC., a Florida corporation (the "Company"), and
_______________ (the "Participant").
WHEREAS, the Participant is an officer or key employee of the Company
or one of its Affiliates and, subject to the terms and conditions set forth
herein, the Company desires to provide the Participant with an additional
incentive to remain in its employ and to increase his or her interest in the
success of the Company by granting the Participant an Award to receive a certain
number of shares of common stock, par value $.0331/3 per share, of the Company
(the "Common Stock") under the Company's 2003 Long-Term Incentive Plan (the
"Plan"), upon the Company's achievement of certain Performance Targets (as set
forth below) during the applicable Performance Period ("Performance Shares");
NOW, THEREFORE, in consideration of the covenants and agreements herein
contained, the parties hereto agree as follows:
1. Definitions; Incorporation of Plan Terms.
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Capitalized terms used herein without definition shall have the
meanings assigned to them in the Plan, a copy of which is attached hereto. This
Award Document and the Performance Shares shall be subject to the Plan, the
terms of which are incorporated herein by reference, and in the event of any
conflict or inconsistency between the Plan and this Award Document, the Plan
shall govern.
2. Grant of Performance Shares.
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Subject to the terms and conditions contained herein and in the Plan,
the Company hereby grants to the Participant the Target Number of Performance
Shares specified at the foot of the signature page hereof. For purposes of the
Plan and this Award Document, the Grant Date is the date specified at the foot
of the signature page hereof.
3. Vesting of Performance Shares.
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(a) Annual Award Vesting. Subject to the terms and conditions contained
herein and in the Plan, the Performance Shares shall vest and become
non-forfeitable in substantially equal installments on each of December 15,
2006, December 15, 2007 and December 15, 2008 (each, a "Vesting Date"),
based on the level of the applicable Performance Targets set forth on
Appendix A hereto that are attained with respect to the performance periods
applicable to each Vesting Date and shall be determined by the (i) number
of Performance Shares that are subject to vesting on such Vesting Date,
multiplied by (ii) applicable Performance Leverage Factor ("PLF") shown in
Appendix A for the attained level of the Performance Targets; provided,
however, that the Participant is employed by the Company or an Affiliate on
the applicable Vesting Date (each, an "Annual Award").
(b) Supplemental Award Vesting. Subject to the terms and conditions
contained herein and in the Plan, the Participant shall also be eligible to
receive an additional number of Performance Shares on each Vesting Date
(the "Supplemental Award") based on the level of the applicable Performance
Targets set forth on Appendix B hereto that are attained with respect to
the performance periods applicable to each Vesting Date and shall be
determined by the (i) number of Performance Shares that actually vest with
respect to the Annual Award on such Vesting Date pursuant to Section 3(a)
above, multiplied by (ii) applicable PLF shown in Appendix B for the
attained level of the Performance Targets; provided, however, that the
Participant is employed by the Company or an Affiliate on the applicable
Vesting Date. Notwithstanding the foregoing, in no event shall a
Participant be entitled to a Supplemental Award if the Participant does not
receive an Annual Award with respect to the applicable Vesting Date.
(c) Fractional Shares. Any fractional Performance Shares which become
distributable at the time such Performance Shares vest shall be rounded up
or down to the nearest whole share of Common Stock.
4. Termination of Employment.
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Except to the extent otherwise provided by the Plan or this Award
Document, in the event of the Participant's termination of employment for any
reason prior to an applicable Vesting Date, the Participant shall immediately
forfeit all unvested Performance Shares as of the date of such termination.
5. Nontransferability of the Performance Shares.
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Unless determined otherwise by the Committee, Performance Shares may
not be sold, pledged, assigned, hypothecated, transferred or disposed of in any
manner, prior to the date that such Performance Shares become vested and
non-forfeitable; provided, however, that Performance Shares shall be
transferable, in whole or in part, with the written consent of the Committee, to
trusts established wholly or in part for the benefit of the Participant's
immediate family members. Such transfers are subject to the terms and conditions
of the Plan and this Award Document. The restrictions on transferability set
forth above shall not apply to Performance Shares after the date that such
Performance Shares becomes vested and non-forfeitable as set forth herein.
6. Rights as a Stockholder.
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The Participant shall have, with respect to the Performance Shares, all
of the rights of a stockholder of the Company, including, if applicable, the
right to vote the Performance Shares and to receive any cash dividends, subject
to the restrictions set forth in the Plan and this Award Document.
7. Dividends and Distributions.
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Any Common Stock or other securities of the Company received by the
Participant as a result of a distribution to holders of Performance Shares or as
a dividend on the Performance Shares shall be subject to the same restrictions
as such Performance Shares, and all
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references to Performance Shares hereunder shall be deemed to include such
Common Stock or other securities.
8. Issuance of Certificates.
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At the time the Performance Shares are granted, or as promptly as
practicable thereafter, Participant shall be issued certificates in respect of
the Performance Shares. Such certificates shall be held in custody by the
Company until the Performance Targets have been satisfied and that, as a
condition of any award of Performance Shares, the Participant shall deliver a
stock power, endorsed in blank, relating to the Common Stock covered by such
award.
9. Taxes and Withholdings.
----------------------
No later than the date as of which an amount first becomes includable
in the gross income of the Participant for applicable income tax purposes with
respect to Performance Shares, the Participant shall pay to the Company or make
arrangements satisfactory to the Committee regarding payment of any federal,
state or local taxes of any kind required by law to be withheld with respect to
such amount.
Unless otherwise determined by the Committee, in accordance with rules
and procedures established by the Committee, the minimum required withholding
obligations may be settled with Common Stock, including Common Stock that is
part of the Award that gives rise to the withholding requirement. The obligation
of the Company under this Award Document shall be conditional upon such payment
or arrangements and the Company shall, to the extent permitted by law, have the
right to deduct any such taxes from any payment of any kind otherwise due to the
Participant.
10. Notices.
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All notices and other communications under this Award Document shall be
in writing and shall be given by hand delivery to the other party or by
facsimile, first class mail, overnight courier, or registered or certified mail,
return receipt requested, postage prepaid, addressed as follows:
If to the Participant:
at the last known address on record at the Company.
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If to the Company:
11770 U.S. Highway 1
Suite 101
Palm Beach Gardens, Florida 33408
Attention: General Counsel
or to such other address or facsimile number as any party shall have furnished
to the other in writing in accordance with this Section 10. Notice and
communications shall be effective when actually received by the addressee.
11. Successor.
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Except as otherwise provided hereunder, this Award Document shall be
binding upon and shall inure to the benefit of any successor or successors of
the Company, and to any transferee or successor of the Participant pursuant to
Section 5.
12. Governing Law.
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The interpretation, performance and enforcement of this Award Document
shall be governed by the laws of the State of Florida without reference to
principles of conflict of laws, as applied to contracts executed in and
performed wholly within the State of Florida.
13. Severability.
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If any provision of this Award Document shall be held illegal or
invalid for any reason, such illegality or invalidity shall not affect the
remaining provisions of this Award Document, but this Award Document shall be
construed and enforced as if such illegal or invalid provision had never been
included herein.
14. Corporate Changes; Changes in Capitalization.
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(a) Neither the Plan or this Award Document shall affect or restrict in
any way the right or power of the Company or its shareholders to make or
authorize any adjustment, recapitalization, reorganization or other change in
the capital structure or business of the Company, or any merger or consolidation
of the Company, or any issue of stock or of options, warrants or rights to
purchase stock or of bonds, debentures, preferred or prior preference stocks
whose rights are superior to or affect the Common Stock or the rights thereof or
which are convertible into or exchangeable for Common Stock, or the dissolution
or liquidation of the Company, or any sale or transfer of all or any part of the
assets or business of the Company, or any sale or transfer of all or any part of
its assets or business, or any other corporate act or proceeding, whether of a
similar character or otherwise.
(b) The number and kind of shares authorized for issuance under the
Plan, including the maximum number of shares available under the special limits
provided for in the Plan, may be equitably adjusted in the sole discretion of
the Committee in the event of a stock split, stock dividend, recapitalization,
reorganization, merger, consolidation, extraordinary dividend, split-up,
spin-off, combination, exchange of shares, warrants or rights offering to
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purchase Common Stock at a price substantially below Fair Market Value or other
similar corporate event affecting the Common Stock in order to preserve, but not
increase, the benefits or potential benefits intended to be made available under
the Plan. In addition, upon the occurrence of any of the foregoing events, the
number of Performance Shares will be equitably adjusted (including by payment of
cash to the Participant) in order to preserve the benefits or potential benefits
intended to be made available to the Participant with respect to such
Performance Shares. The determination as to what adjustments shall be made in
order to preserve the benefits or potential benefits intended to be made
available to the Participant with respect to such Performance Shares shall be
made by the Committee, in its sole discretion, and such determination shall be
final and binding on the Company and the Participant. Unless otherwise
determined by the Committee, such adjusted Performance Shares shall be subject
to the same restrictions and vesting or settlement schedule to which it is
subject.
15. Adjustment of Performance Targets and Award. To the extent
permitted by Code Section 162(m), the Committee shall have the right to adjust
the Performance Targets and the Award (either up or down) if it determines that
an extraordinary corporate event such as a material acquisition or divestiture,
change in the capital structure of the Company or unanticipated business
conditions have materially affected the fairness of the Performance Targets. In
addition, Performance Targets and Awards shall be calculated without regard to
any changes in accounting standards that may be required as a result of changes
in generally accepted accounting principles after such Performance Targets or
Awards are established.
16. Exchange Act.
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Notwithstanding anything contained in the Plan or this Award Document
to the contrary, if the consummation of any transaction under the Plan or this
Award Document would result in the possible imposition of liability on the
Participant pursuant to Section 16(b) of the Exchange Act, the Committee shall
have the right, in its sole discretion, but shall not be obligated, to defer
such transaction to the extent necessary to avoid such liability, but in no
event for a period in excess of 180 days.
17. Amendment.
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Notwithstanding anything herein to the contrary, the Board or the
Committee may, at any time, amend or modify this Award Document; provided,
however, that no amendment or modification of this Award Document shall
materially and adversely alter or impair the rights of the Participant without
the consent of the Participant. The waiver by either party of compliance with
any provision of this Award Document shall not operate or be construed as a
waiver of any other provision of this Award Document, or of any subsequent
breach by such party of a provision of this Award Document.
18. No Rights to Future Awards or Continued Employment.
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The Participant shall not have any claim or right to receive or be
eligible to receive any additional Awards under the Plan. Neither the Plan nor
this Award Document nor any action taken or omitted to be taken hereunder or
thereunder shall be deemed to create or confer on the Participant any right to
be retained in the employ of the Company or to interfere
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with or to limit in any way the right of the Company to terminate the employment
of the Participant at any time.
19. Acceptance and Acknowledgement of Award.
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The Performance Targets and the details outlined in this Award Document
should not be discussed with, shared with, photocopied or distributed to others.
By signing and returning this Award Document, you are agreeing to all of the
terms contained in this Award Document, including, but not limited to, the terms
related to confidentiality. Participation in this program and its details are
highly confidential and may not be discussed by a Participant with anyone other
than the Participant's spouse or immediate family or financial or legal
advisors. Breach of this confidentiality condition could affect the amount of a
Participant's actual Award.
20. Entire Agreement.
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This Award Document and the Plan set forth the entire agreement and
understanding between the parties hereto with respect to the matters covered
herein, and supersede all prior agreements and understandings concerning such
matters. This Award Document may be executed in one or more counterparts, each
of which shall be deemed to be an original, but all such counterparts shall
together constitute one and the same agreement. The headings of sections and
subsections herein are included solely for convenience of reference and shall
not affect the meaning of any of the provisions of this Award Document.
IN WITNESS WHEREOF, the Company has caused this Award Document to be
executed by its duly authorized officer and the Participant has executed this
Award Document, both as of the day and year first above written.
DYCOM INDUSTRIES, INC.
By:
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Name:
Title:
PARTICIPANT
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Name:
Address:
Target Number of Performance Shares: ______
Date of Grant: January 26, 2006
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EXHIBIT 10.1
APPENDIX A
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Annual Award Performance Targets
Pre-Tax Income Before AI Operating Cash Flow Ratio
for for
Applicable Annual Award Applicable Annual Award
Period Period PLF
- ---------------------------------------------------------------------------------------------
10/30/05 -
10/28/06
- ---------------------------------------------------------------------------------------------
Fiscal 2007
- ---------------------------------------------------------------------------------------------
Fiscal 2008
- ---------------------------------------------------------------------------------------------
For purposes of this Award Document, the following terms are defined as
follows:
"Operating Cash Flow Ratio" means the ratio of Operating Cash Flow to Net
Income Before AI.
"PLF" means Performance Leverage Factor.
The following elements will be taken from the Company's consolidated
financial statements for the applicable Annual Award period or Supplemental
Award Period (as applicable):
1. Operating cash flow ("Operating Cash Flow")
2. Pre-Tax Income before asset impairments and before
any amount recorded for Performance Share
compensation ("Pre-Tax Income Before AI")
3. Net income before asset impairments and before any
amount recorded for Performance Share compensation
("Net Income Before AI")
For purposes of this Award Document, Operating Cash Flow Ratio and
Pre-Tax Income Before AI will be rounded to the nearest one hundredth of a
percentage point, with five thousandths of a percentage point being rounded
upwards (e.g., 4.995% being rounded up to 5.0%).
A-1
APPENDIX B
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Supplemental Award Performance Targets
Adjusted Pre-Tax Income Before AI Adjusted Operating Cash
for Flow Ratio for
Applicable Supplemental Award Applicable Supplemental Award
Period Period PLF
- -------------------------------------------------------------------------------------------------------
10/30/05 -
10/28/06
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Fiscal Years
2006-2007
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Fiscal Years
1006-2008
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B-1