EX-10.2 3 y01691exv10w2.htm EX-10.2 exv10w2
Exhibit 10.2
Exhibit A
Performance Unit Award Notice
     
A. Participant:
   
 
   
 
   
B. Grant Date:
  July 28, 2009
 
   
C. Performance Period:
  6/27/2009 through 12/31/2011
 
   
D. Aggregate Target Dollar Award:
   
 
   
 
   
E. Initial Value Per Performance Unit:
   
 
   
 
   
F. Aggregate Target Performance Units:
   
 
   
 
   
G. Performance Measures:
   
1.   Growth in Diluted Earnings per Share: The compounded annual growth rate in L-3’s Diluted EPS. “Diluted EPS” means earnings per common share on a fully diluted basis, determined in accordance with generally accepted accounting principles and as derived from L-3’s audited consolidated financial statements prepared in the ordinary course of business. Diluted EPS shall be adjusted as contemplated by the terms of the Performance Unit Agreement to exclude certain unusual or nonrecurring items.
 
    Portion of Aggregate Target Award for this Performance Measure: 50%

Target Units for this Performance Measure:                     
 
    Performance Scale:
                         
    Diluted        
    EPS   Cumulative    
Performance   Growth   Diluted   Unit
Levels   Rate   EPS Required   Multiplier
Maximum
    ≥ 13 %   ≥ $ 22.47       200 %
 
    10 %   $ 21.14       150 %
Target
    8 %   $ 20.29       100 %
 
    7 %   $ 19.87       75 %
Threshold
    6 %   $ 19.46       50 %
Below Threshold
    < 6 %   < $ 19.46       0 %
    Note: Cumulative Diluted EPS based on 2008 Diluted EPS of $6.84 excluding certain unusual or nonrecurring items contemplated by the Performance Unit Agreement.

 


 

    In the event that the level of actual performance exceeds the Threshold and falls between two of the stated performance levels listed above, the Unit Multiplier will be calculated on a straight-line basis between the two stated Unit Multipliers for those performance levels.
 
    Payment Method: Shares of L-3 stock. Subject to the terms of the Performance Unit Agreement, the number of shares will be determined by multiplying (1) the Target Units for this Performance Measure, by (2) the applicable Unit Multiplier.
 
2.   Relative Total Stockholder Return: L-3’s TSR compared to the returns of a comparison group of companies (see Appendix 1). “TSR” means, with respect to a particular company for particular time period, (a) the change in the per-share market price of the company’s common stock (as quoted in the principal market on which it is traded as of the beginning and ending of the period) plus dividends and other distributions paid per share during such period, divided by (b) the per-share market price of the company’s common stock as quoted as of the beginning of such period, all of which is adjusted for any changes in company’s equity structure, including but not limited to stock splits and stock dividends. This measure will be assessed by determining L-3’s relative percentile positioning on TSR versus companies included in the comparison group.
 
    Portion of Aggregate Target Award for this Performance Measure: 50%

Target Units for this Performance Measure:                     
 
    Performance Scale:
                 
Performance   Relative   Unit
Levels   TSR   Multiplier
Maximum
  > 74th percentile     200 %
 
     63rd percentile     150 %
Target
     50th percentile     100 %
Threshold
     40th percentile     50 %
Below Threshold
  < 40th percentile     0 %
    In the event that the level of actual performance exceeds the Threshold and falls between two of the stated performance levels listed above, the Unit Multiplier will be calculated on a straight-line basis between the two stated Unit Multipliers for those performance levels.
 
    Payment Method: Cash. Subject to the terms of the Performance Unit Agreement, the cash amount will be determined by multiplying (1) the Target Units for this Performance Measure, by (2) the applicable Unit Multiplier, by (3) the fair market value per share of L-3 common stock at end of the Performance Period.

 


 

Appendix 1
The companies included for the Relative Total Stockholder Return assessment are those in the S&P 1500 Aerospace & Defense Index, excluding L-3. This list will be modified by the Compensation Committee to reflect any changes to companies included in the Index.
       S&P 1500 Aerospace & Defense Index
             
    Company   Ticker
  1.    
AAR CORP
  AIR
  2.    
AEROVIRONMENT INC.
  AVAV
  3.    
ALLIANT TECHSYSTEMS INC
  ATK
  4.    
AMERICAN SCIENCE AND ENGINEERING INC
  ASEI
  5.    
APPLIED SIGNAL TECHNOLOGY
  APSG
  6.    
AXSYS TECHNOLOGIES INC
  AXYS
  7.    
BE AEROSPACE INC
  BEAV
  8.    
BOEING CO
  BA
  9.    
CERADYNE INC
  CRDN
  10.    
CUBIC CORP
  CUB
  11.    
CURTISS-WRIGHT CORP
  CW
  12.    
ESTERLINE TECHNOLOGIES CORP
  ESL
  13.    
GENCORP INC
  GY
  14.    
GENERAL DYNAMICS CORP
  GD
  15.    
GOODRICH CORP
  GR
  16.    
HONEYWELL INTERNATIONAL INC
  HON
  17.    
ITT CORP
  ITT
  18.    
LOCKHEED MARTIN CORP
  LMT
  19.    
MOOG INC
  MOG.A
  20.    
NORTHROP GRUMMAN CORP
  NOC
  21.    
ORBITAL SCIENCES CORP.
  ORB
  22.    
PRECISION CASTPARTS CORP
  PCP
  23.    
RAYTHEON CO
  RTN
  24.    
ROCKWELL COLLINS INC
  COL
  25.    
STANLEY INC
  SXE
  26.    
TELEDYNE TECHNOLOGIES INC
  TDY
  27.    
TRIUMPH GROUP INC
  TGI
  28.    
UNITED TECHNOLOGIES CORP
  UTX