ADT 2008 Annual Report Download - page 77

The Plan, as amended and restated, would provide benefits that are substantially similar to those
provided under the current Plan. No additional shares are being authorized under the amended and
restated Plan. The principal changes to the current Plan are:
• the express inclusion of working capital days and customer attrition rates as performance
measures under the Plan;
• the inclusion of additional types of equity-based awards (in addition to DSUs) that may be used
as a component of the annual remuneration of directors; and
• clarification that for performance cycles longer than 12 months, the maximum amount that may
be paid in respect of any 12 month period for either a Short-Term Performance Bonus or a
Long-Term Performance Award paid in Performance Units during such cycle is $5 million,
regardless of when the amount is actually paid out.
The following is a more detailed summary of the principal changes to the Plan described above.
This summary is qualified in its entirety by reference to the complete text of the Plan, as proposed to
be amended and restated, which is attached hereto as Appendix A. To the extent that there is a conflict
between this summary and the Plan, the terms of the Plan will govern. Any capitalized terms that are
used but not defined in this summary have the meaning given to them in the Plan.
Performance Measures.
The Plan provides for Short-Term Performance Bonuses that may be granted in the form of cash
or common shares and Long-Term Performance Awards that may be granted in the form of
Performance Units, Restricted Units or Restricted Stock. Short-Term Performance Bonuses and Long
Term-Performance Awards may be awarded to any Reporting Persons selected by the Committee. The
Committee, in its discretion and as set forth in the Award Certificate, will fix the amount, terms and
conditions of Short-Term Performance Bonuses and Long-Term Performance Awards, subject to the
requirements in the Plan.
Among other requirements, within 90 days of the commencement of a Performance Cycle, the
Committee must establish the Performance Measures applicable to the performance based Award.
Specifically, the Target Amount of any Short-Term Performance Bonus or any Performance Units that
are granted as a Long-Term Performance Award and the Target Vesting Percentage of any Restricted
Unit or Share of Restricted Stock that is granted as a Long-Term Performance Award will be
determined by reference to the level of performance attained in relation to one or more Performance
Measures selected by the Committee. The Performance Measures that the Committee may select under
the Plan have not substantially changed since the Plan was last approved by shareholders, although
express Performance Measures related to working capital days and customer attrition rates have been
included in the list. The Performance Measures consist of any one or combination of the following:
• Net operating profit after taxes;
• Net operating profit after taxes, per Share;
• Return on invested capital;
• Return on assets or net assets;
• Total shareholder return;
• Relative total shareholder return (as compared with a peer group of the Company);
• Earnings before income taxes;
• Earnings per Share;
• Net income;
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