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8-K - FORM 8-K - HUBBELL INC | c16573e8vk.htm |
Exhibit 10.1
HUBBELL INCORPORATED
SENIOR EXECUTIVE INCENTIVE COMPENSATION PLAN
SENIOR EXECUTIVE INCENTIVE COMPENSATION PLAN
ARTICLE I
Purpose
The purpose of this Senior Executive Incentive Compensation Plan (the Plan) is to provide
incentive compensation to executive officers of Hubbell Incorporated (the Company) and its
subsidiaries, to motivate eligible executives toward even higher achievement and business results,
to tie their goals and interests to those of the Company and its stockholders and to enable the
Company to attract and retain highly qualified executives. The Plan is for the benefit of covered
employees as described below who are selected to become participants by the Committee (as defined
below).
ARTICLE II
Administration
2.1 The Compensation Committee of the Companys Board of Directors consisting of not less
than two directors, each of whom shall qualify as an outside director as that term is defined
under Section 162(m) of the Code (the Committee), shall administer the Plan. The Committee shall
serve at the pleasure of the Board. If it is later determined that one or more members of the
Committee do not so qualify, actions taken by the Committee prior to such determination shall be
valid despite such failure to qualify. Any member of the Committee may resign at any time by notice
in writing mailed or delivered to the Secretary of the Company. Vacancies in the Committee shall be
filled by the Board.
2.2 The Committee shall administer the Plan under such rules, regulations and criteria as
it shall prescribe. Its decisions in the administration and interpretation of the Plan shall be
final as to all interested parties and shall be and constitute acts of the Company.
ARTICLE III
Eligibility and Participation
3.1 The persons eligible to participate in the Plan shall be those senior executive
officers who are, or, as determined in the discretion of the Committee, may become, covered
employees (as defined in Section 162(m) of the Internal Revenue Code of 1986, as amended, the
Code) of the Company for the applicable taxable year of the Company.
3.2 The Committee shall from time to time designate the employees eligible for
participation in the Plan. The persons so designated by the Committee are hereinafter called
participants.
ARTICLE IV
Determination of Incentive Payments
4.1 Participants are eligible to receive an incentive payment under the Plan upon the
attainment of objective performance goals (the Performance Goals) which are established by the
Committee and relate to one or more of the following financial, operational or other business
criteria with respect to the Company or any of its subsidiaries (the Performance Criteria): (i)
net earnings (either before or after one or more of the following: (A) interest, (B) taxes, (C)
depreciation and (D) amortization); (ii) economic value added (as determined by the Committee);
(iii) sales or revenue; (iv) net income (either before or after taxes); (v) operating earnings;
(vi) cash flow (including, but not limited to, operating cash flow and free cash flow); (vii)
return on capital; (viii) return on invested capital; (ix) return on shareholders equity; (x)
return on assets; (xi) shareholder return; (xii) return on sales; (xiii) gross or net profit
margin; (xiv) productivity; (xv) expense; (xvi) operating margin; (xvii) operating efficiency;
(xviii) customer satisfaction;
(xix) working capital efficiency; (xx) earnings per share; (xxi) price per share of the Companys
common stock; and (xxii) market share, any of which may be measured either in absolute terms or as
compared to any incremental increase or as compared to results of a peer group or to market
performance indicators or indices. Depending on the Performance Criteria used to establish the
Performance Goals, the Performance Goals may be expressed in terms of overall Company performance
or the performance of a division, business unit, platform or an individual. The achievement of
each Performance Goal shall be determined in accordance with Generally Accepted Accounting
Principles in the United States, International Financial Reporting Standards or such other
accounting principles or standards as may apply to the Companys financial statements under United
States federal securities laws from time to time (Applicable Accounting Standards).
4.2 On or before March 30 of each calendar year (each, a Performance Period), the
Committee shall establish the Performance Goals for that Performance Period and shall determine the
method by which a participants incentive payments hereunder shall be calculated for that
Performance Period, based on the attainment of such Performance Goals. Such method may include,
but shall not be limited to, determining a participants incentive payments by allocating to the
executive a designated percentage of the incentive compensation fund established each year under
Article III of the Companys Incentive Compensation Plan to be payable upon attainment of the
applicable Performance Goals. Without limiting its authority hereunder, the Committee may condition
payment of a participants incentive payments on additional service-related criteria; e.g., that
the participant remain in the employ of the Company for the entire Performance Period.
4.3 After the end of the applicable Performance Period, the Committee shall certify in
writing whether the Performance Goals and any other material terms of the incentive payment have
been satisfied (such written certification may take the form of minutes of the Committee).
Notwithstanding the foregoing, such determinations shall in all events be made within the time
prescribed by, and otherwise in compliance with, Section 162(m) of the Code.
4.4 The Committee shall have the discretion, prior to making any incentive payment, to
decrease, but not increase, the incentive payment otherwise calculated pursuant to Section 4.1. In
no event shall the annual incentive payment to any participant exceed $5.0 million.
4.5 The Committee may, in its sole discretion, provide that one or more objectively
determinable adjustments shall be made to one or more of the Performance Goals. Such adjustments
may include one or more of the following: (i) items related to a change in accounting principle;
(ii) items relating to financing activities; (iii) expenses for restructuring or productivity
initiatives; (iv) other non-operating items; (v) items related to acquisitions; (vi) items
attributable to the business operations of any entity acquired by the Company during the
Performance Period; (vii) items related to the disposal of a business or segment of a business;
(viii) items related to discontinued operations that do not qualify as a segment of a business
under Applicable Accounting Standards; (ix) items attributable to any stock dividend, stock split,
combination or exchange of stock occurring during the Performance Period; (x) any other items of
significant income or expense which are determined to be appropriate adjustments; (xi) items
relating to unusual or extraordinary corporate transactions, events or developments, (xii) items
related to amortization of acquired intangible assets; (xiii) items that are outside the scope of
the Companys core, on-going business activities; or (xiv) items relating to any other unusual or
nonrecurring events or changes in applicable laws, accounting principles or business conditions.
ARTICLE V
Method of Making Incentive Payments
Incentive payments awarded under the Plan shall be paid in cash. The amount of any incentive
payment to be made to a participant in cash shall be paid as soon as practicable (but not later
than six months) after the close of the fiscal year for which such incentive payment is awarded.
ARTICLE VI
General Provisions
6.1 Neither the establishment of the Plan nor the selection of any employee as a
participant shall give any participant any right to be retained in the employ of the Company or any
subsidiary of the Company, or any right
whatsoever under the Plan other than to receive incentive payments awarded by the Committee.
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6.2 The place of administration of the Plan shall be conclusively deemed to be within the
State of Connecticut, and the validity, construction, interpretation and effect of the Plan, its
rules and regulations and the rights of any and all participants having or claiming to have an
interest therein or thereunder shall be governed by and determined conclusively and solely in
accordance with the laws of the State of Connecticut, without regard to any conflicts of laws
provisions.
6.3 No member of the Board of Directors of the Company shall be liable to any person in
respect of the Plan for any act or omission of such member or of any other member or of any
officer, agent or employee of the Company.
6.4 This Plan shall not be deemed the exclusive method of providing incentive compensation
to a participant or any other employee of the Company or a subsidiary of the Company.
6.5 The Company or any subsidiary making a payment hereunder shall withhold therefrom such
amounts as may be required by federal, state or local law.
ARTICLE VII
Amendment, Suspension or Termination
The Board of Directors of the Company may from time to time amend, suspend or terminate, in
whole or in part, any or all of the provisions of the Plan, provided that (i) no such action shall
affect the rights of any participant or the operation of the Plan with respect to any payment to
which a participant may have become entitled, deferred or otherwise, prior to the effective date of
such action, and (ii) no amendment that requires shareholder approval in order for incentive
payments hereunder to be deductible under the Code may be made without approval of the shareholders
of the Company.
ARTICLE VIII
Effective Date of the Plan
The Plan shall become effective as of January 1, 2011, subject to approval by shareholders in
May, 2011. So long as the Plan shall not have been previously terminated by the Company, it shall
be resubmitted for approval by the Companys shareholders in 2016, and every fifth year thereafter.
In addition, the Plan shall be resubmitted to the Companys shareholders for approval as required
by Section 162(m) of the Code if it is amended in any way that changes the material terms of the
Plans Performance Goals, including by materially modifying the Performance Goals, increasing the
maximum incentive payment payable under the Plan or changing the Plans eligibility requirements.
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