TIME:		11:00 a.m. on Wednesday, May 24, 2006
PLACE:		Lewis & Clark Room, 16th Floor, Saint Louis Club, Pierre Laclede Center, 7701 Forsyth Boulevard, St. Louis, Missouri 63105
ITEMS OF BUSINESS:		To elect eight directors, each for a term of one year. To approve increasing the number of awards individual participants may receive under the Cable Design Technologies Corporation 2001 Long-Term Performance Incentive Plan to an annual limit of 400,000. To transact any other business as may properly come before the meeting.
RECORD DATE:		You are entitled to vote if you were a shareholder at the close of business on Monday, April 3, 2006.
FINANCIAL STATEMENTS:		Included with this mailing is the Company’s 2005 Annual Report to Shareholders which includes the Company’s Annual Report on Form 10-K. The Form 10-K includes the Company’s audited financial statements and notes for the year ended December 31, 2005, and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations.
VOTING BY PROXY:		Please submit a proxy as soon as possible so your shares can be voted at the meeting in accordance with your instructions. You may submit your proxy over the Internet, by telephone, or by mail. For specific instructions, please refer to the Questions and Answers beginning on page 1 of this proxy statement and the instructions on the proxy card.

1

QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND THE ANNUAL MEETING			4
Why am I receiving these materials?			4
What information is contained in these materials?			4
What matters will be voted on at the meeting?			4
What is Belden CDT’s voting recommendation?			4
What shares owned by me can be voted?			4
What is the difference between holding shares as a shareholder of record and as a beneficial owner?			5
How can I vote my shares in person at the meeting?			5
How can I vote my shares without attending the meeting?			5
How do I vote my Belden CDT shares held in the Belden CDT Retirement Savings Plan and the Belden UK Employee Share Ownership Plan?			5
Can I change my vote?			6
How are votes counted and what is the voting requirement to approve the proposals?			6
What does it mean if I receive more than one proxy or voting instruction card?			7
Where can I find the voting results of the meeting?			7
What happens if additional proposals are presented at the meeting?			7
What class of shares is entitled to be voted?			7
What is the quorum requirement for the meeting?			7
Who will count the votes?			7
Is my vote confidential?			7
Who will bear the cost of soliciting votes for the meeting?			7
May I propose actions for consideration at next year’s annual meeting of shareholders or nominate individuals to serve as directors?			7
BOARD STRUCTURE AND COMPENSATION			9
COMMITTEES			9
Audit Committee			9
Audit Committee Report			10
Fees to Independent Registered Public Accountants for 2005 and 2004			10
Audit Committee’s Pre-Approval Policies and Procedures			11
Compensation Committee			11
Nominating and Corporate Governance Committee			11
Communications with Directors			12
DIRECTOR COMPENSATION			13
MATTERS TO BE VOTED ON:
Item I — To elect eight directors			14
Item II — To approve increasing the number of awards individual participants may receive under the Cable Design Technologies Corporation 2001 Long-Term Performance Incentive Plan to an annual limit of 400,000			16
EQUITY COMPENSATION PLAN INFORMATION			20
STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT			21
Beneficial Ownership Table of Directors, Nominees and Executive Officers			21
Beneficial Ownership Table of Shareholders Owning More Than Five Percent			22

2

EXECUTIVE COMPENSATION			23
Report of the Compensation Committee on Executive Compensation			23
Summary Compensation Table			27
Option Grants in Last Fiscal Year			29
Aggregated Option Exercises in Last Fiscal Year and Fiscal Year-End Option Values			30
Cash Long-Term Performance Plan			30
Certain Relationships and Related Transactions			31
Certain Change in Control Arrangements and Other Matters			31
Pension Plans			33
Pension Benefits Table			33
Performance Graph			34
Appendix I — Audit Committee Charter			I-1
Appendix II — Cable Design Technologies Corporation 2001 Long-Term Performance Incentive Plan			II-1

3

 

QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND THE ANNUAL MEETING

 

Q:	Why am I receiving these materials?

A:

The Board of Directors (the “Board”) of Belden CDT Inc. (sometimes referred to as the “Company” or “Belden CDT”) is providing these proxy materials to you in connection with the solicitation of proxies by Belden CDT on behalf of the Board for the 2006 annual meeting of shareholders which will take place on May 24, 2006. This proxy statement includes information about the issues to be voted on at the meeting. You are invited to attend the meeting and are requested to vote on the proposals described in this proxy statement.

 

Q:	What information is contained in these materials?

A:

The information included in this proxy statement relates to the proposals to be voted on at the meeting, the voting process, the compensation of directors and our most highly-paid officers, and certain other required information. Our 2005 Annual Report to Shareholders which includes our 2005 Annual Report on Form 10-K is also enclosed. The Form 10-K includes our 2005 audited financial statements with notes and the related Management’s Discussion and Analysis of Financial Condition and Results of Operations.

 

Q:	What matters will be voted on at the meeting?

A:	Two matters will be voted on at the meeting:

	•	To elect eight directors, each for a term of one year; and
	•	To increase the number of awards individual participants may receive under the Cable Design Technologies Corporation 2001 Long-Term Performance Incentive Plan to an annual limit of 400,000.

 

Q:	What is Belden CDT’s voting recommendation?

A:	Our Board of Directors recommends that you vote your shares “FOR” each proposal.

 

Q:	What shares owned by me can be voted?

A:

All shares owned by you as of April 3, 2006, the record date, may be voted by you. These shares include those (1) held directly in your name as the shareholder of record, and (2) held for you as the beneficial owner through a stockbroker, bank or other nominee, including those shares purchased through the Belden CDT Inc. Retirement Savings Plan (the Company’s 401 (k) plan) and those shares purchased through the Belden U.K. Employee Share Ownership Plan.

4

 

Q:	What is the difference between holding shares as a shareholder of record and as a beneficial owner?

A:	Most Belden CDT shareholders hold their shares through a stockbroker, bank or other nominee rather than directly in their own name. As summarized below, there are some distinctions between shares held of record and those owned beneficially.

	Shareholder of Record

	Beneficial Owner

 

Q:	How can I vote my shares in person at the meeting?

A:	Shares held directly in your name as the shareholder of record may be voted in person at the annual meeting. If you choose to do so, please bring the enclosed proxy card or other proof of identification.

 

Q:	How can I vote my shares without attending the meeting?

A:

Whether you hold shares directly as the shareholder of record or beneficially in street name, you may direct your vote without attending the meeting. You may vote by granting a proxy or, for shares held in street name, by submitting voting instructions to your broker or nominee. You will be able to do this over the Internet, by telephone or by mail. Please refer to the summary instructions below and those included on your proxy card or, for shares held in street name, the voting instruction card provided by your broker or nominee.

 

Q:	How do I vote my Belden CDT shares held in the Belden CDT Inc. Retirement Savings Plan and the Belden UK Employee Share Ownership Plan?

5

 

Q:	Can I change my vote?

A:

You may change your proxy or voting instructions at any time prior to the vote at the annual meeting. For shares held directly in your name, you may accomplish this by granting a new proxy or by attending the annual meeting and voting in person. Attendance at the meeting will not cause your previously granted proxy to be revoked unless you specifically so request. For shares held beneficially by you, you may accomplish this by submitting new voting instructions to your broker or nominee.

 

Q:	How are votes counted and what is the voting requirement to approve the proposals?

A:	Election of eight directors, each for a term of one year (Item I):

6

 

Q:	What does it mean if I receive more than one proxy or voting instruction card?

A:	It means your shares are registered differently or are in more than one account. Please provide voting instructions for all proxy and voting instruction cards you receive.

 

Q:	Where can I find the voting results of the meeting?

A:	We will announce preliminary voting results at the meeting and publish final results in our quarterly report on Form 10-Q for the second quarter of 2006.

 

Q:	What happens if additional proposals are presented at the meeting?

A:

Other than the proposals described in this proxy statement, we do not expect any matters to be presented for a vote at the annual meeting. If you grant a proxy, the persons named as proxy holders, Kevin L. Bloomfield, the Company’s Secretary, and Christopher E. Allen, the Company’s Assistant Secretary, will have the discretion to vote your shares on any additional matters properly presented for a vote at the meeting. If for any unforeseen reason any of our nominees are not available as a candidate for director, the persons named as proxy holders will vote your proxy for such other candidate or candidates as may be nominated by the Board of Directors.

 

Q:	What class of shares is entitled to be voted?

A:	Each share of our common stock outstanding as of the close of business on April 3, 2006, the record date, is entitled to one vote at the annual meeting.

 

Q:	What is the quorum requirement for the meeting?

A:	The quorum requirement for holding the meeting and transacting business is a majority of the outstanding shares entitled to be voted. The shares may be present in person or represented by proxy at the meeting. Both abstentions and withheld votes are counted as present for the purpose of determining the presence of a quorum.

 

Q:	Who will count the votes?

A:	A representative of ADP Investor Communication Services will tabulate the votes and will act as the inspector of election.

 

Q:	Is my vote confidential?

A:

Proxy instructions, ballots and voting tabulations that identify individual shareholders are handled in a manner that protects your voting privacy. Your vote will not be disclosed either within Belden CDT or to third parties except (1) as necessary to meet applicable legal requirements, (2) to allow for the tabulation of votes and certification of the vote, or (3) to facilitate a successful proxy solicitation by our Board. Occasionally, shareholders provide written comments on their proxy cards, which are then forwarded to Belden CDT management.

 

Q:	Who will bear the cost of soliciting votes for the meeting?

A:

Belden CDT will pay the entire cost of preparing, assembling, printing, mailing and distributing these proxy materials. In addition to the mailing of these proxy materials, the solicitation of proxies or votes may be made in person, by telephone or by electronic communication by our directors, officers, and employees, who will not receive any additional compensation for such solicitation activities. We have hired ADP Investor Communication Services to assist us in the distribution of proxy materials and tabulating votes. We also have retained Morrow & Co. to provide assistance in soliciting proxies for a fee of $6,500, plus distribution costs and other expenses. We will also reimburse brokerage houses and other custodians, nominees and fiduciaries for their reasonable out-of-pocket expenses for forwarding proxy and solicitation materials to shareholders.

 

Q:	May I propose actions for consideration at next year’s annual meeting of shareholders or nominate individuals to serve as directors?

A:	You may submit proposals for consideration at future shareholder meetings, including director nominations.

7

	•	The name of the shareholder and evidence of the person’s ownership of Company stock, including the number of shares owned and the length of time of ownership; and
	•	The name of the candidate, the candidate’s resume or a listing of his or her qualifications to be a director of Belden CDT and the person’s consent to be named as a director if selected by the Committee and nominated by the Board.

8

 

BOARD STRUCTURE AND COMPENSATION

									Nominating and
									Corporate
Name of Director			Audit			Compensation			Governance
Lorne D. Bain			X
Lance C. Balk						X
Christopher I. Byrnes						X			*
Bryan C. Cressey									X
C. Baker Cunningham**
Michael F.O. Harris			X
Glenn Kalnasy						X*
Ferdinand C. Kuznik**
John M. Monter						X
Bernard G. Rethore			X*
John Stroup (Effective October 31, 2005)
Number of meetings held in 2005			15			7			4

 

The Audit Committee

•	meeting with its financial management and registered public accounting firm (Ernst & Young LLP) to review the financial statements, quarterly earnings releases and financial data of the Company;
•	reviewing and selecting the independent registered public accounting firm who will audit the Company’s financial statements;

9

•	reviewing the selection of the internal auditors (Brown Smith Wallace LLC) who provide internal audit services;
•	reviewing the scope, procedures and results of Company financial audits, internal audit procedures and internal controls assessments and procedures under Section 404 of the Sarbanes-Oxley Act of 2002 (“SOX”); and
•	evaluating the Company’s key financial and accounting personnel.

 

Audit Committee Report

 

Fees to Independent Registered Public Accountants for 2005 and 2004

		2005				2004
Audit Fees		$	2,006,105			$	2,489,256
Audit-Related Fees		$	13,300			$	68,800
Tax Fees		$	499,511			$	510,717
All Other Fees			0				0
Total EY fees		$	2,518,916			$	3,068,773

10

 

Audit Committee’s Pre-Approval Policies and Procedures

 

Compensation Committee

 

Nominating and Corporate Governance Committee

11

 

Corporate Governance

•	each committee of the Board will consist, to the extent reasonably practicable, of an equal number of the directors designated by Belden and CDT;
•	if any director designated by either Belden or CDT ceases to serve on the Board for any reason, the members of the Board designated by Belden or CDT, as appropriate, may appoint or nominate, as the case may be, the person to fill such directorship; and
•	the affirmative vote of at least 70% of the Company’s entire Board will be required to remove certain named officers and to recommend the removal of any of the Board members.

12

 

DIRECTOR COMPENSATION

COMPENSATION TABLE FOR 2005
Annual Director Retainer			$50,000
Fee paid for Special Committee or Board Meetings			$1,000
Audit Committee Attendance Fee for Regular Meetings			$1,000
Reimbursement for Expenses Attendant to Board Membership			Yes
Annual Stock Award*			2,500
Annual Retainer for Committee Chairs			$4,000

*		A Board member may not dispose of shares received as an annual stock award until he leaves the Board.

13

 

ITEM I  —  ELECTION OF DIRECTORS

		Lorne D. Bain, 64, had been a director of Belden since 1993 and was appointed to the Company’s Board at the time of the Merger. Until September 2000, he served as Chairman, President and Chief Executive Officer of WorldOil.com, a trade publication and Internet-based business serving the oilfield services industry. From 1997 to February 2000, he was Managing Director of Bellmeade Capital Partners, L.L.C., a venture capital firm. From 1991 to 1996, he was Chairman and Chief Executive Officer of Sanifill, Inc., an environmental services company. Mr. Bain received a B.B.A. degree from St. Edwards University, a J.D. degree from the University of Texas School of Law and completed Harvard Business School’s Advanced Management Program.
		Lance C. Balk, 48, has been a director of the Company since March 2000. Mr. Balk has been a partner of Kirkland & Ellis LLP since 1989, specializing in securities law and mergers and acquisitions. Effective May 5, 2006, he plans to leave Kirkland & Ellis and join Dade Behring, Inc. as Senior Vice President and General Counsel effective May 8, 2006. Dade Behring is a leading supplier of products, systems and services for clinical diagnostics. Mr. Balk received a B.A. degree from Northwestern University and a J.D. degree and a M.B.A. degree from the University of Chicago.
		Bryan C. Cressey, 56, has been Chairman of the Board of the Company since 1988 and a director of the Company since 1985. For the past twenty-five years, he has also been a General Partner and Principal of Golder, Thoma and Cressey and Thoma Cressey Equity Partners, both private equity firms. He is also a director of Select Medical Corporation, a public company, and several private companies. Mr. Cressey received a J.D. degree and a M.B.A. degree from Harvard University. Director, Select Medical Corporation
		Michael F.O. Harris, 67, has been a director of the Company since 1985. From 1982 to 2003, Mr. Harris was a Managing Director of The Northern Group, Inc., which acted as Managing General Partner of various investment partnerships that owned several manufacturing companies. Mr. Harris has a B.S. degree from Yale University and a M.B.A. degree from Harvard University.

14

		Glenn Kalnasy, 62, has been a director of the Company since 1985. From February 2002 through October 2003, Mr. Kalnasy served as the Chief Executive Officer and President of Elan Nutrition Inc., a privately held company. From 1982 to 2003, he was a Managing Director of The Northern Group, Inc. Mr. Kalnasy has a B.S. degree from Southern Methodist University.
		John M. Monter, 58, had been a director of Belden since 2000 and was appointed to the Company’s Board at the time of the Merger. From 1993 to 1996, he was President of the Bussmann Division of Cooper Industries, Inc. Bussmann manufactures electrical and electronic fuses. From 1996 through 2004, he was President and Chief Executive Officer of Brand Services, Inc. (Brand) and also a member of the board of directors of the parent companies, Brand DLJ Holdings (1996-2002) and Brand Holdings, LLC (2002-present). He was named Chairman of DLJ Holdings in 2001, and Chairman of Brand Holdings LLC in 2002. Since January 1, 2005, he serves as Vice Chairman, Brand Holdings, LLC. Brand is a supplier of scaffolding and specialty industrial services. Mr. Monter received a B.S. degree in journalism from Kent State University and a M.B.A. degree from the University of Chicago.
		Bernard G. Rethore, 64, had been a director of Belden since 1997 and was appointed to the Company’s Board at the time of the Merger. In 1995 he became Director, President and Chief Executive Officer of BW/IP, Inc., a supplier of fluid transfer equipment, systems and services, and was elected its Chairman in 1997. In July 1997, Mr. Rethore became Chairman and Chief Executive Officer of Flowserve Corporation, which was formed by the merger of BW/IP, Inc., and Durco International, Inc. In 2000 he retired as an executive officer and director and was named Chairman of the Board, Emeritus. From 1989 to 1995, Mr. Rethore was Senior Vice President of Phelps Dodge Corporation and President of Phelps Dodge Industries. He received a B.A. degree in economics (Honors) from Yale University and a M.B.A. degree from the Wharton School of the University of Pennsylvania. Director, Dover Corporation and Walter Industries, Inc.
		John S. Stroup, 39, was appointed President, Chief Executive Officer and member of the Board effective October 31, 2005. From 2000 to the date of his appointment with the Company, he was employed by Danaher Corporation, a manufacturer of professional instrumentation, industrial technologies, and tools and components. At Danaher, he initially served as Vice President, Business Development. He was promoted to President of a division of Danaher’s Motion Group and later to Group Executive of the Motion Group. Earlier, he was Vice President of Marketing and General Manger with Scientific Technologies Inc. He has a B.S. degree in mechanical engineering from Northwestern University and a M.B.A. from the University of California at Berkeley Haas School of Business.

15

ITEM II — APPROVE INCREASING THE NUMBER OF AWARDS INDIVIDUAL
PARTICIPANTS MAY RECEIVE UNDER THE CABLE DESIGN TECHNOLOGIES
CORPORATION 2001 LONG-TERM PERFORMANCE INCENTIVE PLAN
(THE “PLAN”) TO AN ANNUAL LIMIT OF 400,000

16

17

18

19

 

EQUITY COMPENSATION PLAN INFORMATION

A

B

C

Number of Securities

Remaining Available for

Number of Securities

Future Issuance Under

to be Issued Upon

Weighted Average

Equity Compensation Plans

Exercise of

Exercise Price of

(Excluding Securities

Plan Category

Outstanding Options

Outstanding Options

Reflected in Column A)

Equity Compensation Plans Approved by Stockholders (1)

3,617,722

(3)

$

24.19

2,718,212

(5)

Equity Compensation Plans Not Approved by Stockholders (2)

1,112,434

(4)

$

23.077

0

Total

4,730,156

2,718,212

(1)		Consists of the Belden Inc. Long-Term Incentive Plan (the “1993 Belden Plan”); the Belden Inc. 2003 Long-Term Incentive Plan (the “2003 Belden Plan”); the Cable Design Technologies Corporation Long-Term Performance Plan (the “CDT Plan”); the Cable Design Technologies Corporation Supplemental Long-Term Performance Incentive Plan (the “CDT Supplemental Plan”); and the Cable Design Technologies Corporation 2001 Long-Term Performance Incentive Plan (the “2001 CDT Plan”). The 1993 Belden Plan, the CDT Plan and the CDT Supplemental Plan have expired or have been terminated, but stock option awards remain outstanding under these plans. No further awards will be issued under the 2003 Belden Plan.
(2)		Consists of the Cable Design Technologies Corporation 1999 Long-Term Performance Incentive Plan (the “1999 CDT Plan”) and the Executive Employment Agreement between the Company and John Stroup dated September  26, 2005 (the “Executive Employment Agreement”). The Company has terminated the 1999 CDT Plan but stock option awards remain outstanding under it. The Executive Employment Agreement, effective October 31, 2005, provided for, among other things, the award to Mr. Stroup of 451,580 stock options and 150,526 restricted stock units to compensate him for the “in the money” value of his unvested options and unvested restricted stock that he forfeited upon leaving his prior employer and as a further inducement to leave his prior employment. 100,000 of such stock options were granted under the 2001 CDT Plan; the remaining stock options and all of the restricted stock units were granted outside of any long-term incentive plan. Starting in 2006, Mr. Stroup participates in the Company’s long-term incentive plans. For the three-year period through 2008, the Executive Employment Agreement provides for him to be granted equity awards in the form of stock options and restricted stock units (unless Mr. Stroup and the Compensation Committee agree to other awards) having a value of not less than $2.5 million per year, at least 50% of the value of which would be as restricted stock units. These awards would be issued under the 2001 CDT Plan to the extent the limits of such plan so permit; any amount in excess of such limits would be awarded in cash (e.g., as cash-based phantom stock and stock appreciation rights). The Executive Employment Agreement is included as an Exhibit to the Company’s Form 8-K, filed on September 27, 2005.
(3)		Consists of 2,253,915 shares under the 1993 Belden Plan; 393,923 shares under the 2003 Belden Plan; 26,195 shares under the CDT Plan; 275,939 shares under the CDT Supplemental Plan; and 667,750 shares under the 2001 CDT Plan. All of these shares pertain to outstanding stock options. Of these stock options issued under the 1993 Belden Plan and the 2003 Belden Plan, 2,431,171 were assumed by the Company in connection with the merger involving Cable Design Technologies Corporation and Belden Inc., at a weighted average exercise price of $25.166.
(4)		Consists of 610,328 shares under the 1999 CDT Plan (all pertaining to outstanding stock options) and 502,106 shares (351,580 stock options and 150,526 restricted stock units) under the Executive Employment Agreement. The weighted average exercise price does not take into account Mr. Stroup’s restricted stock units.
(5)		Consists of 2,718,212 shares under the under the 2001 CDT Plan.

20

 

STOCK OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

BENEFICIAL OWNERSHIP TABLE OF DIRECTORS, NOMINEES AND EXECUTIVE OFFICERS

		Number of Shares
		Beneficially				Acquirable				Percent of Class
Name		Owned(1)(2)(3)				Within 60 Days(4)				Outstanding(5)
Lorne D. Bain			12,800				4,000				*
Lance Balk			11,854				11,000				*
Kevin Bloomfield			41,814				118,667				*
Christopher I. Byrnes			10,500				4,000				*
Bryan C. Cressey			97,189				14,000				*
C. Baker Cunningham			181,143				530,000				1.67
Michael F. O. Harris			23,753				12,000				*
Glenn Kalnasy			15,404				11,000				*
Robert W. Matz			18,366				53,000				*
John M. Monter			13,100				4,000				*
Richard K. Reece			57,862	(6)			7,667				*
Bernard G. Rethore			14,100	(7)			4,000				*
D. Larrie Rose			25,623				79,667				*
Peter Sheehan			6,564				41,517				*
John Stroup			150,828								*
All directors and named officers as a group (15 persons)			680,900				894,518				3.70
*  Less than one percent

(1)		The number of shares shown includes shares that are individually or jointly owned, as well as shares over which the individual has either sole or shared investment or voting authority. Some directors and executive officers disclaim beneficial ownership of some of the shares included in the table, as indicated below:

•		Mr. Cressey — does not include shares held by the Bryan and Christina Cressey Foundation. Mr. Cressey is the President of the foundation and disclaims any beneficial ownership of the shares owned by the foundation.

(2)		For executive officers, the number of shares listed includes the following interest in shares held in the Company’s 401 (k) savings plans as of January 18, 2006 (Mr. Cunningham’s and Mr. Reece’s values were as of June 30, 2005): Mr. Stroup — 194 shares; Mr. Cunningham — 4,523 shares; Mr. Sheehan — 409 shares; Mr. Matz — 1,860 shares; Mr. Rose — 4,473 shares; Mr. Bloomfield — 4,566 shares; Mr. Reece — 4,596 shares; and all named executive officers as a group — 20,621 shares.
(3)		For executive officers, the number of shares listed includes unvested restricted stock awards granted under the Company’s long-term incentive plans and, for Mr. Stroup, employment inducement RSU awards granted outside such plans: Mr. Stroup — 150,828 RSUs; Mr. Sheehan — 2,359 shares; Mr. Rose — 8,236 shares; Mr. Bloomfield — 9,281 shares; Mr. Reece — 2,907 shares; and all named executive officers as a group — 173,611 RSUs and shares.
(4)		Reflects the number of shares that could be purchased by exercise of options available at March 1, 2006, or within 60 days thereafter, under the Company’s long-term incentive plans. See Summary Compensation Table below and footnotes (3) and (4) of Summary Compensation Table for amounts and terms of the restricted shares, RSUs, and options. Table does not include any long-term compensation awards made in 2006.

21

(5)		Based on the number of shares outstanding at March 1, 2006 — i.e., 42,633,092 (this number does not include Mr. Stroup’s RSUs which do not have voting rights before vesting).
(6)		For Mr. Reece, based on his last Form 4 filed with the SEC on December  1, 2005.
(7)		Includes 9,600 shares held in trust.

 

BENEFICIAL OWNERSHIP TABLE OF SHAREHOLDERS
OWNING MORE THAN FIVE PERCENT

		Amount and Nature				Percent of
Name and Address		of Beneficial				Outstanding
of Beneficial Owner		Ownership				Common Stock
FMR Corp.			4,211,535	(1)			9.718	%
82 Devonshire Street
Boston, MA 02109
T. Rowe Price Associates, Inc.			3,525,813	(2)			8.1	%
100 E. Pratt Street
Baltimore, Maryland 21202
Dimensional Fund Advisors Inc.			2,475,277	(3)			5.71	%
1299 Ocean Avenue, 11th Floor
Santa Monica, CA 90401

(1)		Information based on Schedule 13G/A filed with the SEC by FMR Corp. on February 14, 2006, reporting sole voting power over 70,500 shares and sole dispositive power over 4,211,535 shares.
(2)		Information based on a Schedule 13G/A filed with the SEC by T. Rowe Price Associates, Inc. on February 14, 2006, reporting sole voting power over 880,150 shares and sole dispositive power over 3,525,813 shares.
(3)		Information based on a Schedule 13G/A filed with the SEC by Dimensional Fund Advisors Inc. on February 6, 2006, reporting sole voting and dispositive power over 2,475,277 shares.

22

 

EXECUTIVE COMPENSATION

23

24

25

26

														Long-Term Compensation Awards
														Restricted				Securities
		Award Compensation												Stock				Underlying				All
						Salary(1)				Bonus(2)				Awards(3)				Options(4)				Other(5)
Name and Principal Position		Year				($)				($)				($)				(#)				($)
John Stroup			2005				102,308				280,000				2,999,983				451,580				11,768
President and			—				—				—				—				—				—
Chief Executive Officer			—				—				—				—				—				—
C. Baker Cunningham			2005				552,179				535,320				—				120,000				4,724,345
President and			2004				638,025				781,100				765,913				50,000				356,699
Chief Executive Officer			2003				618,397				350,000				337,500				50,000				27,828
Peter Sheehan			2005				305,000				108,500				—				23,000				68,670
Vice President, Operations and			2004				280,743				171,278				96,698				—				132,396
President of Electronics			2003				268,790				27,840				—				7,850				36,600
Robert W. Matz			2005				305,000				108,500				—				23,000				77,478
Vice President, Operations and			2004				260,038				208,900				196,168				10,000				154,922
President of Networking			2003				218,333				115,000				81,000				10,000				85,269
D. Larrie Rose			2005				310,769				108,500				—				23,000				125,875
Vice President, Operations and			2004				281,288				208,900				207,176				10,000				159,568
President of European Operations			2003				253,141				115,000				81,000				10,000				80,470
Kevin L. Bloomfield			2005				270,500				92,200				—				20,000				62,892
Vice President, Secretary			2004				260,000				178,800				228,251				12,000				119,219
and General Counsel			2003				250,000				105,000				94,500				12,000				11,250
Richard K. Reece			2005				312,500				—				—				23,000				719,050
Vice President, Finance and			2004				330,000				230,700				292,417				15,000				151,691
Chief Financial Officer			2003				320,000				136,000				121,500				15,000				39,961

(1)		Salaries are amounts actually received. Mr. Stroup’s compensation information is for the period of October 31, 2005 (the date of his appointment) through December 31, 2005 and is based on an annual salary of $600,000. The aggregate amount of perquisites and other personal benefits for any named executive does not exceed $50,000 or 10% of the total annual salary and bonus for any such named executive and, therefore, such items have been excluded.
(2)		For 2005, determined by the Compensation Committee at its February 22, 2006 meeting. Mr. Cunningham’s bonus was paid at the time of his leaving the Company in accordance with his separation agreement. Mr. Reece’s severance payment under his separation agreement included a component based on his 2004 bonus. See footnote 5 and under the caption “Certain Change in Control Arrangements and Other Matters” for a summary of Mr. Cunningham’s and Mr. Reece’s separation arrangements.
(3)		The following is a summary of the restricted stock grants awarded to the named officers. With respect to the 2005 grant of restricted stock units (RSUs) to Mr. Stroup, the figures in this column reflect the closing price of Belden CDT shares on October 31, 2005 ($19.93), the grant date. With respect to the 2003 restricted stock grants to Messrs. Cunningham, Matz, Rose, Bloomfield and Reece, the figures in this column reflect the closing price of Belden shares ($13.50 per share) on February 18, 2003, the effective grant date price. With respect to (i) the 2004 restricted stock grants to Messrs. Cunningham, Matz, Rose, Bloomfield and Reece, the figures in this column reflect the closing price of Belden shares ($19.25) on February 23, 2004, the effective grant date price and (ii) the restricted stock awarded to Messrs. Cunningham, Sheehan, Matz, Rose, Bloomfield and Reece pursuant to their retention and integration awards agreement (which were entered into at the time of the Merger), the closing price of Belden CDT shares ($20.50) on July 15, 2004. A summary of the retention and integration award agreements are set out below under the caption “Certain Change in Control Arrangements and Other Matters.” All restricted stock and RSU awards are subject to forfeiture in the event the individual does not remain employed by the Company for a prescribed period. For the RSUs, the prescribed period is five years from the effective date of Mr. Stroup’s employment with the Company per his Executive Employment Agreement (October 31, 2005). For all restricted stock awards (other than those provided under the retention and integration awards agreements) the prescribed period is three years from the grant date. The restricted stock

27

		granted under a retention and integration awards agreement is paid in three installments: one-third upon each of the consummation of the Merger, and the first and second anniversary of the consummation of the Merger, provided the named officer is still employed by the Company. The retention and integration awards agreements also provide that if the officer’s employment is terminated after the Merger by the Company without cause or by the officer for good reason (as those terms are defined in the officer’s change of control agreement), immediately prior to the effective time of such termination any unvested restricted stock (other than unvested restricted stock awarded under the retention and integration awards agreements) will vest. The following chart shows the number and value of the restricted stock and RSUs at the end of 2005 at the closing price of Belden CDT shares on December 31, 2005 ($24.43) for the named officers. See footnote 5 and under the caption “Certain Change in Control Arrangements and Other Matters” for a summary of Mr. Cunningham’s, Mr. Matz’s and Mr. Reece’s separation arrangements, which includes a summary of the disposition of their restricted stock.

		2003 Grant								2004 Grant								2005 Grant
		No.				($)				No.				($)				No.				($)
John Stroup																			150,526				3,677,350
Peter Sheehan											2,359				57,630
Robert W. Matz			6,000				146,580				7,968				194,658
D. Larrie Rose			6,000				146,580				8,236				201,205
Kevin L. Bloomfield			7,000				171,010				9,281				226,735
Richard K. Reece			9,000				219,870				2,907				71,018

(4)		All unvested stock options granted prior to the Merger (July 15, 2004) became vested as of the Merger. The 2005 option awards were made on March 30, 2005 for the named officers, except for Mr. Stroup, at an exercise price of $22.66. Mr. Stroup’s 2005 option awards were made on October 31, 2005 at an exercise price of $19.93. All 2005 option awards vest equally over three years and expire ten years after the grant date. For the 2003 grants, the exercise price of the options for Messrs. Matz, Rose and Bloomfield is $13.30; the exercise price for Mr. Cunningham is $12.445; and the exercise price for Mr. Sheehan is $20.00. The exercise price for the 2004 options is $19.075. In each instance, the exercise price equaled the average of the high and low of Belden shares or the Company shares, as applicable, on the effective grant date. Mr. Sheehan’s 2003 option award reflects the one for two reverse stock split that occurred prior to the Merger. The exercise price of $20.00 per share equaled the closing price of the Company’s shares on the grant date adjusted for the reverse stock split. In connection with his leaving the Company, effective November 2, 2005, Mr. Cunningham’s March 30, 2005 grant of 120,000 options was cancelled. In connection with his leaving he Company, effective November 30, 2005, two-thirds (15,333 options) of Mr. Reece’s March 30, 2005 grant of 23,000 options was cancelled, with the remainder to vest on March 30, 2006. In connection with his leaving the Company, effective February 6, 2006, pursuant to his Separation Agreement with the Company, the vesting of Mr. Matz’s March 30, 2005 options was accelerated.
(5)		Messrs. Sheehan, Matz, Rose and Bloomfield:  Amounts for 2005 consist of (i) Company contributions and allocations in Company-sponsored defined contribution plans and other plans in the amounts of $20,322, $18,671, $18,930 and $16,142, respectively; (ii) cash received on July 15, 2005 under the retention and integration awards agreement in the amounts of $48,348, $40,333, $45,833 and $46,750, respectively; (iii) for Mr. Rose, payments related to foreign cost-of-living differentials totaling $61,112; and (iv) for Mr. Matz, reimbursements related to moving/relocation totaling $18,475.
		Mr. Stroup:  Amounts for 2005 consist of Company contributions and allocations in Company-sponsored defined contribution plans in the amount of $4,604, and moving expense of $7,164.
		Mr. Cunningham:  Amounts for 2005 include other amounts paid upon Mr. Cunningham’s leaving the Company in accordance with a Separation of Employment Agreement with the Company dated November 2, 2005 (“Agreement”), which confirmed Mr. Cunningham’s entitlements and obligations under his Change of

28

		Control Employment Agreement with the Company resulting from his separation of employment, as follows: (i) severance of $4,337,294; (ii) accrued vacation of $37,788; (iii) outplacement expense of $22,500; and (iv) $142,333 to be paid on July  15, 2006 under his retention and integration awards agreement but which was accelerated as of October 31, 2005 per the Agreement. Mr. Cunningham’s remaining amounts for 2005 consist of Company contributions and allocations in Company-sponsored defined contribution plans and other plans in the amount of $42,097, and $142,333 received on July 15, 2005 under his retention and integration awards agreement.
		Mr. Reece:  Amounts for 2005 include those paid upon Mr. Reece’s leaving the Company in accordance with a Separation Agreement with the Company dated November 30, 2005 (“Agreement”), which confirmed Mr. Reece’s entitlements arising out of his employment with and/or separation from the Company, as follows: (i) severance of $580,700 (payable monthly over a one-year period commencing December 1, 2005); and (ii) $59,583 to be paid on July 15, 2006 under his retention and integration awards agreement but which was considered vested per the Agreement. Mr. Reece’s remaining amounts for 2005 consist of Company contributions and allocations in Company-sponsored defined contribution plans and other plans in the amount of $19,184 and $59,583 received on July 15, 2005 under his retention and integration awards agreement.

 

Option Grants in Last Fiscal Year

		Individual Grants
						Percent of												Potential Realizable
		Number of				Total												Values at Assumed
		Securities				Options												Annual Rates of Stock
		Underlying				Granted to												Price Appreciation for
		Options				Employees in				Exercise				Expiration				Option Term(1)
		Granted(#)(2)				Fiscal Year				Price ($/Sh)(3)				Date				5%($)				10%($)
John Stroup			451,580				43.8			$	19.93				10/31/15			$	5,660,045			$	14,343,665
C. Baker Cunningham			120,000				11.6			$	22.66				03/30/15				See Note	(1)			See Note	(1)
Peter Sheehan			23,000				2.2			$	22.66				03/30/15			$	327,840			$	830,810
Robert W. Matz			23,000				2.2			$	22.66				03/30/15			$	327,840			$	830,810
D. Larrie Rose			23,000				2.2			$	22.66				03/30/15			$	327,840			$	830,810
Kevin L. Bloomfield			20,000				1.9			$	22.66				03/30/15			$	285,078			$	722,443
Richard K. Reece			23,000				2.2			$	22.66				03/30/15				See Note	(1)			See Note	(1)

(1)		The Company elected to use “Potential Realizable Values at Assumed Annual Rates of Stock Price Appreciation for Option Term.” The dollar amounts under these columns are the result of calculations at the 5% and 10% rates set by the SEC ($32.46 and $51.69, respectively, for Mr. Stroup and $36.92 and $58.79, respectively, for all others) and therefore are not intended to forecast possible future appreciation, if any, of the stock price of the Company. All of Mr. Cunningham’s 2005 stock option awards were forfeited upon his departure from the Company in accordance with his Separation of Employment Agreement with the Company dated November 2, 2005. Two-thirds (15,333 stock options) of Mr. Reece’s 2005 stock option awards were forfeited upon his departure from the Company in accordance with his Separation Agreement with the Company dated November 30, 2005.
(2)		Messrs. Cunningham, Reece, Matz, Rose and Bloomfield’s awards were granted under the Belden Inc. 2003 Long-Term Incentive Plan (the “2003 Plan”). Mr. Sheehan’s awards were granted under the Cable Design Technologies 2001 Long-Term Performance Incentive Plan (the “2001 Plan”). 100,000 of Mr. Stroup’s options were granted under the 2001 Plan and the remainder (351,580) outside of the Company’s plans as “employment inducement awards” in accordance with the NYSE rules. All grants vest in equal amounts over three years and expire ten years after the grant date. However, Mr. Matz became vested in full in his options in connection with his leaving the Company, such options to remain exercisable until February  7, 2007. See also note (1) above regarding the disposition of Mr. Cunningham’s and Mr. Reece’s grants upon their departure from the Company.
(3)		The option exercise price (other than Mr. Stroup’s) is the average of the high and low of Company shares on March 30, 2005, the grant date price. The option exercise price for Mr. Stoup’s options is the average of the high and low of Company shares on October 31, 2005, the grant date price.

29

										Number of				Value of Unexercised
										Securities Underlying				In-the-Money Options at
		Shares				Value				Unexercised Options at				December 31, 2005($)
		Acquired on				Realized				December 31, 2005(#)				Exercisable/
		Exercise(#)				($)				Exercisable/ Unexercisable(1)				Unexercisable(2)
John Stroup			—				—				0/451,580			0/$	2,032,110
C. Baker Cunningham			—				—				595,000/0			$	1,801,700/0
Peter Sheehan			25,313			$	36,865				33,850/23,000			$	203,770/$40,595
Robert W. Matz			—				—				30,000/23,000			$	174,350/$40,595
D. Larrie Rose			10,000			$	92,229				79,500/23,000			$	236,613/$40,595
Kevin L. Bloomfield			—				—				122,000/20,000			$	409,658/$35,300
Richard K. Reece			51,855			$	173,284				134,145/7,667			$	363,557/$13,532

(1)		For Mr. Stroup the table reflects option grants on October 31, 2005 at an exercise price of $19.93 per share. For Mr. Sheehan, the table reflects option grants on June 11, 1999 at an exercise price of $18.75 per share; on October 1, 2002 at an exercise price of $12.66 per share; on November 3, 2003 at an exercise price of $20.00 per share; and on March 30, 2005 at an exercise price of $22.66 per share. For Mr. Matz, the table reflects option grants on May 13, 2002 at an exercise price of $23.48 per share; February 18, 2003 at an exercise price of $13.30 per share; on February  23, 2004 at an exercise price of $19.07 per share; and on March 30, 2005 at an exercise price of $22.66 per share. For each of the other named executive officers, the table reflects option grants on March 30, 2005 at an exercise price of $22.66 per share; on February 28, 1996 at an exercise price of $30.75 per share; on February 20, 1998 at an exercise price of $39.53 per share; on January 5, 1999 at an exercise price of $20.06 per share; on February 16, 2000 at an exercise price of $21.75 per share; on February 14, 2001 at an exercise price of $26.38 per share; on February  18, 2002 at an exercise price of $20.86 per share; on February 18, 2003 at an exercise price of $13.30 per share ($12.445 per share for Mr. Cunningham); and on February 23, 2004 at an exercise price of $19.07 per share. For Mr. Rose, the table also reflects an option grant on November  4, 1998 at $16.93 per share. For each grant, the exercise price was the average of the high and low of Belden shares or Company shares, as applicable, on the effective date of the grant. The grants generally vest in equal amounts over three years. However, options granted before the Merger (July 15, 2004) became vested at the time of the Merger and Mr. Matz became fully vested in his March 30, 2005 grant pursuant to his leaving the Company, effective February 6, 2006. Mr. Cunningham’s March 30, 2005 option award of 120,000 was cancelled pursuant to his separation agreement, and two-thirds of Mr. Reece’s option award of 23,000 shares was cancelled pursuant to his separation agreement. Options expire ten years after the grant date.
(2)		“Value” represents the difference between the closing price of the common stock on the New York Stock Exchange on December 31, 2005 ($24.43) and the exercise price of such options.

Cash Long-Term Performance Plan

30

 

Certain Relationships and Related Transactions

 

Certain Change in Control Arrangements and Other Matters

	•	two times (2.99 in the case of Mr. Cunningham) the sum of the executive’s base salary and the highest annual bonus earned by the executive with respect to the two completed fiscal years preceding the date of termination; and
	•	the amount necessary to make the executive whole with respect to any excise taxes imposed under the Internal Revenue Code with respect to excess parachute payments.

	•	an amount equal to two times the sum of his highest annual compensation (excluding bonuses) over the prior three years and his average annual bonus over the prior three years; and
	•	health and other employee benefits existing on the Merger date (excluding profit sharing and 401 (k) contributions) for two years.

31

32

 

Pension Plans

 

Pension Benefits Table

		Years of
		Credited				Year				Estimated
		Service as of				Individual				Annual
		January 1,				Reaches				Benefit at
		2006				Age 65				Age 65
John Stroup			0.2				2031			$	280,100
C. Baker Cunningham			35.3				2006			$	230,400
Peter Sheehan			1.0				2026			$	104,100
Kevin Bloomfield			24.5				2016			$	94,100
D. Larrie Rose			33.5				2012			$	71,300
Robert W. Matz			3.6				2011			$	27,100
Richard K. Reece			12.4				2021			$	153,525

33

 

PERFORMANCE GRAPH

		INDEX RETURNS
		Years Ending
		Base
		Period
Company / Index		Dec 00				Dec 01				Dec 02				Dec 03				Dec 04				Dec 05
BELDEN CDT INC			100				93.62				61.20				85.96				95.23				101.21
S&P 500 INDEX			100				88.11				68.64				88.33				97.94				102.75
S&P SMALLCAP COMMUNICATIONS EQUIPMENT			100				70.57				35.57				58.42				62.08				51.85
DOW JONES ELECTRONIC & ELECTRICAL EQUIPMENT			100				58.81				37.67				59.17				59.31				61.89

34

 

Appendix I

	•	Communications — To strengthen the Committee’s knowledge of relevant current and prospective business issues, the Chairperson and others on the Committee shall have contact throughout the year with senior management, other Committee Chairpersons, the independent auditors and other Committee advisors.
	•	Annual Plan — The Committee, with input from management and other key Committee advisors, shall develop an annual plan responsive to the “Primary Committee Responsibilities” detailed below.
	•	Meeting Agenda — The Chairperson, with input from other Committee members, shall develop Committee meeting agendas. The Chairperson may ask management, key Committee advisors, and others to participate in this process.
	•	Committee Expectations and Information Needs — The Committee shall communicate its expectations and the nature, timing, and extent of its information needs to management and external parties, including the independent auditors.
	•	External Resources — To fulfill its responsibilities, the Committee, in its sole discretion, shall have the right to retain its own legal, accounting and other advisors. The Committee shall have authority and appropriate funding for the retention of such advisors and for the payment of ordinary administrative expenses of the Committee that are necessary or appropriate in carrying out its duties. The Company must provide appropriate funding, as determined by the Committee, for payment of audit services performed by the independent auditors.
	•	Committee Meetings and Attendees — The Committee schedules quarterly meetings and, when necessary, additional meetings. To carry out its responsibilities, the Committee will request members of management,

I-1

		counsel, and the independent auditors, as applicable, to participate in Committee meetings. Periodically and at least annually, the Committee will meet in private session with only Committee members. The Committee also shall meet separately with management, with internal auditors (or those with responsibility for the internal audit function), and with the independent auditors. It shall be understood that the independent auditors, counsel, or members of management may, at any time, request a meeting with the Committee or Chairperson with or without management.

	•	The Committee shall have a clear understanding with management and the independent auditors that the independent auditors report directly to the Committee, as the representative of the Board and shareholders, and that the independent auditors are ultimately accountable to the Board and the Committee. The Committee shall have the sole authority and responsibility to hire, evaluate and, when deemed necessary or advisable, replace the independent auditors. The Committee shall directly oversee the work of the independent auditors. The Committee shall determine the appropriate compensation for the independent auditors and shall be responsible for resolving disagreements between management and the independent auditors regarding financial reporting. Annually, the Committee shall review and select the Company’s independent auditors.
	•	The Committee shall discuss with the independent auditors the overall scope and plans for its external audit, including the adequacy of staffing and compensation. The Committee shall meet separately with the independent auditors, with and without management present, to discuss the results of their examinations.
	•	The Committee shall review with the independent auditors their assessment of the quality, not just the acceptability, of the Company’s significant accounting principles and underlying estimates as applied in its financial reporting, and any important changes in accounting principles and the application thereof in both interim and annual financial reports. As part of such review, the Committee shall review all critical accounting policies and practices used; all alternative treatments of financial information within generally accepted accounting principles that have been discussed with management, ramifications of the use of such alternative disclosures and treatments, and the treatment preferred by the independent auditors; and other material written communications between the independent auditors and management, such as management letters or schedule of unadjusted differences.
	•	The Committee shall pre-approve all auditing services and permitted non-audit services (including the fees and terms thereof) to be performed for the Company by the independent auditors. As part of assessing whether to approve any non-audit services, the Committee will consider whether the non-audit services are compatible with the independence of the independent auditors.
	•	The audit partner of the independent auditors (having primary responsibility for the audit of the Company) will not continue in such role beyond five consecutive years. The independent auditors shall inform the Committee of any illegal act of which they become aware.

	•	Risk Management — In reliance on management’s representations and the independent auditor’s review, the Committee shall discuss the Company’s business risk management process, including insurance coverage and the scope thereof, and the adequacy of the Company’s overall control environment and controls in selected areas representing significant financial and business risks.
	•	Annual and Quarterly Reports and Other Major Regulatory Filings — The Committee shall discuss the annual financial statements and quarterly financial statements with management and the independent auditors, including the Company’s disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (“MD&A”). The Committee also shall discuss other information that the Committee deems necessary in advance of filings or disclosures and shall recommend to the Board whether the audited financial statements should be included in the Company’s Form 10-K pursuant to the Exchange Act regulations.

I-2

	•	Earnings Press Releases — The Committee shall discuss with management and the independent auditors earnings press releases and other material, non-routine public disclosures, as well as financial information and earnings guidance provided to analysts and rating agencies. Particular attention should be given to the quality and integrity of the results, including discussing the adequacy of reserves and accruals. The Committee also shall determine that the independent auditors are satisfied with the quarterly results and the disclosure and content of the proposed press release.
	•	Internal Controls and Regulatory Compliance — In reliance on management’s representations and the independent auditor’s review, the Committee shall periodically review and assess the Company’s system of internal controls for detecting accounting and reporting financial errors, fraud and defalcations, legal violations, noncompliance with the Company’s code of ethical conduct, and significant conflicts of interest and related-party transactions.
	•	Internal Audit Responsibilities — The Committee shall review and assess (i) the annual internal audit plan and the process used to develop the plan; (ii) the status of activities, significant findings, recommendations, and management’s response; and (iii) the internal audit performance and changes in internal audit leadership or key financial management.
	•	Independent Auditor Report on Internal Quality Controls — At least annually, the Committee shall obtain and review a report of the independent auditors describing: (i) the firm’s internal quality control procedures; and (ii) any material issues raised by the most recent internal quality-control review (or peer review) of the firm or by any inquiry or investigation by governmental or professional authorities, within the past five years, respecting one or more independent audits of the firm, and any steps taken to deal with any such issues.
	•	Regulatory Examinations — The Committee shall review and assess any SEC inquiries and the results of examinations by other regulatory authorities in terms of important findings, recommendations, and management’s response.
	•	Independence of Auditors — The Committee shall review and assess the auditor’s independence, the matters included in the written disclosures required by the Independence Standards Board, the overall scope and focus of the annual audit and the scope and level of involvement with unaudited quarterly or other periodic information. The Committee will take appropriate action in response to such review and assessment to satisfy itself of the independence of the independent auditors.
	•	Financial Reporting and Controls — The Committee shall review and assess any financial statement issues and risks that may have a material impact or effect on reported financial information, the processes used by management to address such matters, related auditor views, and the basis for audit conclusions. In connection therewith, the Committee shall review the matters required to be discussed by SAS 61 (Codification of Statements on Auditing Standards). The Committee shall review material conclusions on audit work in advance of the public release of financials.
	•	Auditor Recommendations and Audit Problems and Management’s Response — The Committee shall review and assess important independent auditor’s and internal auditor’s recommendations or audit problems or difficulties with respect to financial reporting, controls, other matters, and management’s response with respect to such matters. In connection therewith, the Committee shall consider the views of management and auditors on the overall quality of annual financial reporting.
	•	Complaint Procedures — The Committee shall establish procedures for addressing, on a confidential basis, complaints received by the Company regarding accounting, internal controls or other matters, and the confidential, anonymous submission by employees of concerns regarding questionable accounting or auditing matters.
	•	CEO and CFO Certifications — The Committee shall review and assess any disclosures made to the Committee by the Company’s CEO and CFO during their certification process for the Form 10-K and Form 10-Q regarding any significant deficiency in the design or operation of internal controls or material

I-3

		weaknesses therein, any fraud involving management or other employees who have a significant role in the Company’s disclosure controls, or other matters.

	•	Hiring Policies — The Committee shall oversee that the Company will not engage an accounting firm to conduct audit services if the Company’s CEO, controller, or CFO was employed by the accounting firm and participated in the audit of the Company during the one-year period prior to the date of the initiation of the audit.
	•	Reporting to the Board of Directors — The Committee shall report to the full Board after Committee meetings.
	•	Proxy Statement Report — The Committee shall prepare the report that the SEC rules require be included in the Company’s annual proxy statement.
	•	Evaluation — The Committee shall conduct a self-performance evaluation annually.

I-4

 

CABLE DESIGN TECHNOLOGIES CORPORATION

 

2001 Long-Term Performance Incentive Plan

 

1.  Purpose.  The purpose of the 2001 Long-Term Performance Incentive Plan (the “Plan”) is to advance the interests of Cable Design Technologies Corporation, a Delaware corporation (the “Company”) and its stockholders by (i) providing incentives to certain employees of the Company, directors and to certain other individuals who perform services for, or to whom an offer of employment has been extended by, the Company, including those who contribute significantly to the strategic and long-term performance objectives and growth of the Company and (ii) to enable the Company to attract, retain and reward the best available persons for positions of responsibility.

 

2.  Administration.  The Plan shall be administered solely by the Board of Directors (the “Board”) of the Company or, if the Board shall so designate, by a committee of the Board that shall be comprised of not fewer than two directors (the “Committee”); provided that the Committee may delegate the administration of the Plan in whole or in part, on such terms and conditions, and to such person or persons as it may determine in its discretion. References to the Committee hereunder shall include the Board where appropriate.

 

The Committee has all the powers vested in it by the terms of the Plan set forth herein, such powers to include exclusive authority (except as may be delegated as permitted herein) to select the employees and other individuals to be granted Awards under the Plan, to determine the type, size and terms of the Award to be made to each individual selected, to modify the terms of any Award that has been granted, to determine the time when Awards will be granted, to establish performance objectives, to make any adjustments necessary or desirable as a result of the granting of Awards to eligible individuals located outside the United States and to prescribe the form of the instruments embodying Awards made under the Plan. The Committee is authorized to interpret the Plan and the Awards granted under the Plan, to establish, amend and rescind any rules and regulations relating to the Plan, and to make any other determinations which it deems necessary or desirable for the administration of the Plan. The Committee (or its delegate as permitted herein) may correct any defect or supply any omission or reconcile any inconsistency in the Plan or in any Award in the manner and to the extent the Committee deems necessary or desirable to carry it into effect. Any decision of the Committee (or its delegate as permitted herein) in the interpretation and administration of the Plan, as described herein, shall lie within its sole and absolute discretion and shall be final, conclusive and binding on all parties concerned. The Committee may act only by a majority of its members in office, except that the members thereof may authorize any one or more of their members or any officer of the Company to execute and deliver documents or to take any other ministerial action on behalf of the Committee with respect to Awards made or to be made to Plan participants. No member of the Committee and no officer of the Company shall be liable for anything done or omitted to be done by him, by any other member of the Committee or by any officer of the Company in connection with the performance of duties under the Plan, except for his own willful misconduct or as expressly provided by statute. Determinations to be made by the Committee under the Plan may be made by its delegates.

 

3.  Participation.  Consistent with the purposes of the Plan, the Committee shall have exclusive power (except as may be delegated as permitted herein) to select key employees of the Company and its subsidiaries, directors and other individuals performing services for the Company who may participate in the Plan and be granted Awards under the Plan. Eligible individuals may be selected individually or by groups or categories, as determined by the Committee in its discretion.

 

4.  Awards under the Plan.

 

(a) Types of Awards.  Awards under the Plan may include, but need not be limited to, one or more of the following types, either alone or in any combination thereof: (i) “Stock Options,” (ii) “Stock Appreciation Rights,”(iii) “Restricted Stock,” (iv) “Performance Grants” and (v) any other type of Award deemed by the Committee in its discretion to be consistent with the purposes of the Plan (including, but not limited to, Awards of or options or similar rights granted with respect to unbundled stock units or components thereof, and Awards to be made to participants who are foreign nationals or are employed or performing services outside the United States). Stock Options, which include “Nonqualified Stock Options” (which may be awarded to participants or sold at a

price determined by the Committee (“Purchased Options”)) and “Incentive Stock Options” or combinations thereof, are rights to purchase common shares of the Company having a par value of $.01 per share and stock of any other class into which such shares may thereafter be changed (the “Common Shares”). Nonqualified Stock Options and Incentive Stock Options are subject to the terms, conditions and restrictions specified in Paragraph 5. Stock Appreciation Rights are rights to receive (without payment to the Company) cash, Common Shares, other Company securities (which may include, but need not be limited to, unbundled stock units or components thereof, debentures, preferred stock, warrants, securities convertible into Common Shares or other property (“Other Company Securities”)) or property, or other forms of payment, or any combination thereof, as determined by the Committee, based on the increase in the value of the number of Common Shares specified in the Stock Appreciation Right. Stock Appreciation Rights are subject to the terms, conditions and restrictions specified in Paragraph 6. Shares of Restricted Stock are Common Shares which are issued subject to certain restrictions pursuant to Paragraph 7. Performance Grants are contingent awards subject to the terms, conditions and restrictions described in Paragraph 8, pursuant to which the participant may become entitled to receive cash, Common Shares, Other Company Securities or property, or other forms of payment, or any combination thereof, as determined by the Committee.

 

(b) Maximum Number of Shares that May be Issued.  There may be issued under the Plan (as Restricted Stock, in payment of Performance Grants, pursuant to the exercise of Stock Options or Stock Appreciation Rights, or in payment of or pursuant to the exercise of such other Awards as the Committee, in its discretion, may determine) an aggregate of not more than 3,400,000 Common Shares (after the reverse stock split effective on July 15, 2004), subject to adjustment as provided in Paragraph 14. In any one calendar year, the Committee shall not grant to any one participant options or SARs to purchase a number of shares of Common Stock, and shall not grant to any one participant Restricted Stock or Performance Grants, in excess of 400,000 shares. Common Shares issued pursuant to the Plan may be either authorized but unissued shares, treasury shares, reacquired shares, or any combination thereof; provided, however, that, unless and until this plan is approved by the Company’s shareholders, only treasury shares shall be issued hereunder. If any Common Shares issued as Restricted Stock or otherwise subject to repurchase or forfeiture rights are reacquired by the Company pursuant to such rights, or if any Award is canceled, terminates or expires unexercised, any Common Shares that would otherwise have been issuable pursuant thereto will be available for issuance under new Awards.

 

(c) Rights with respect to Common Shares and Other Securities.

 

(i) Unless otherwise determined by the Committee in its discretion, a participant to whom an Award of Restricted Stock has been made (and any person succeeding to such a participant’s rights pursuant to the Plan) shall have, after issuance of a certificate for the number of Common Shares awarded and prior to the expiration of the Restricted Period (as hereinafter defined) or the earlier repurchase of such Common Shares as herein provided, ownership of such Common Shares, including the right to vote the same and to receive dividends or other distributions made or paid with respect to such Common Shares (provided that such Common Shares, and any new, additional or different shares, or Other Company Securities or property, or other forms of consideration which the participant may be entitled to receive with respect to such Common Shares as a result of a stock split, stock dividend or any other change in the corporate or capital structure of the Company, shall be subject to the restrictions hereinafter described as determined by the Committee in its discretion), subject, however, to the options, restrictions and limitations imposed thereon pursuant to the Plan. Notwithstanding the foregoing, a participant with whom an Award agreement is made to issue Common Shares in the future, shall have no rights as a stockholder with respect to Common Shares related to such agreement until issuance of a certificate to him.

 

(ii) Unless otherwise determined by the Committee in its discretion, a participant to whom a grant of Stock Options, Stock Appreciation Rights, Performance Grants or any other Award is made (and any person succeeding to such a participant’s rights pursuant to the Plan) shall have no rights as a stockholder with respect to any Common Shares or as a holder with respect to other securities, if any, issuable pursuant to any such Award until the date of the issuance of a stock certificate to him for such Common Shares or other instrument of ownership, if any. Except as provided in Paragraph 14, no adjustment shall be made for dividends, distributions or other rights (whether ordinary or extraordinary, and whether in cash, securities, other property or other forms of consideration, or any combination thereof) for which the record date is prior to the date such stock certificate or other instrument of ownership, if any, is issued.

5.  Stock Options.  The Committee may grant or sell Stock Options either alone, or in conjunction with Stock Appreciation Rights, Performance Grants or other Awards, either at the time of grant or by amendment thereafter; provided that an Incentive Stock Option may be granted only to an eligible employee of the Company or any parent or subsidiary corporation. Each Stock Option (referred to herein as an “Option”) granted or sold under the Plan shall be evidenced by an instrument in such form as the Committee shall prescribe from time to time in accordance with the Plan and shall comply with the following terms and conditions, and with such other terms and conditions, including, but not limited to, restrictions upon the Option or the Common Shares issuable upon exercise thereof, as the Committee, in its discretion, shall establish:

 

(a) The option price shall not be less than the fair market value of the Common Shares subject to such Option at the time the Option is granted, as determined by the Committee, and if an incentive stock option is granted to an employee who owns stock representing more than ten percent of the voting power of all classes of stock of the Company or any parent or subsidiary (a “Ten Percent Employee”), such option price shall not be less than 110% of such fair market value at the time the Option is granted.

 

(b) The Committee shall determine the number of Common Shares to be subject to each Option. The number of Common Shares subject to an outstanding Option may be reduced on a share-for-share or other appropriate basis, as determined by the Committee, to the extent that Common Shares under such Option are used to calculate the cash, Common Shares, Other Company Securities or property, or other forms of payment, or any combination thereof, received pursuant to exercise of a Stock Appreciation Right attached to such Option, or to the extent that any other Award granted in conjunction with such Option is paid.

 

(c) The Option may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of, except by will or the laws of descent and distribution or to a participant’s family member (as defined in General Instruction A.1(a)(5) to Form S-8 under the Securities Act of 1933, as amended, and any successor thereto) by gift or a qualified domestic relations order (as defined in the Internal Revenue Code of 1986, as amended), and shall be exercisable during the grantee’s lifetime only by him. Unless the Committee determines otherwise, the Option shall not be exercisable for at least six months after the date of grant, unless the grantee ceases employment or performance of services before the expiration of such six-month period by reason of his disability as defined in Paragraph 12 or his death.

 

(d) The Option shall not be exercisable:

 

(i) in the case of any Incentive Stock Option granted to a Ten Percent Employee, after the expiration of five years from the date it is granted, and, in the case of any other Option, after the expiration of ten years from the date it is granted. Any Option may be exercised during such period only at such time or times and in such installments as the Committee may establish;

 

(ii) unless payment in full is made for the shares being acquired thereunder at the time of exercise as set forth in paragraph (e) below; such payment shall be made in such form (including, but not limited to, cash, Common Shares, or the surrender of another outstanding Award under the Plan, or any combination thereof) as the Committee may determine in its discretion; and

 

(iii) unless the person exercising the Option has been, at all times during the period beginning with the date of the grant of the Option and ending on the date of such exercise, employed by or otherwise performing services for the Company, or a corporation, or a parent or subsidiary of a corporation, substituting or assuming the Option in a transaction to which Section 424(a) of the Internal Revenue Code of 1986, as amended, or any successor statutory provision thereto (the “Code”), is applicable, except that

 

(A) if such person shall cease such employment or performance of services by reason of his disability as defined in Paragraph 12 or early, normal or deferred retirement under an approved retirement program of the Company (or such other plan or arrangement as may be approved by the Committee, in its discretion, for this purpose) while holding an Option which has not expired and has not been fully exercised, such person, at any time within three years (or such period determined by the Committee) after the date he ceased such employment or performance of services (but in no event after the Option has expired), may exercise the Option with respect to any shares as to which he

could have exercised the Option on the date he ceased such employment or performance of services, or with respect to such greater number of shares as determined by the Committee;

 

(B) if any person to whom an Option has been granted shall die holding an Option which has not expired and has not been fully exercised, his executors, administrators, heirs or distributees, as the case may be, may, at any time within one year (or such other period determined by the Committee) after the date of death (but in no event after the Option has expired), exercise the Option with respect to any shares as to which the decedent could have exercised the Option at the time of his death, or with respect to such greater number of shares as determined by the Committee; or

 

(C) if such person shall cease employment or performance of services while holding an Option which has not expired and has not been fully exercised, the Committee may determine to allow such person at any time within the one year (or three months in the case of an Incentive Stock Option) or such other period determined by the Committee after the date he ceased such employment or performance of services (but in no event after the Option has expired), to exercise the Option with respect to any shares as to which he could have exercised the Option on the date he ceased such employment or performance of services, or with respect to such greater number of shares as determined by the Committee.

 

(e) Unless otherwise determined by the Committee, payment for shares being acquired under any Option shall be made (i) in cash (including check, bank draft, money order or wire transfer of immediately available funds), (ii) by delivery of outstanding Common Shares with a fair market value on the date of exercise equal to the aggregate exercise price payable with respect to the Options’ exercise, (iii) by simultaneous sale through a broker reasonably acceptable to the Committee of shares acquired on exercise, as permitted under Regulation T of the Federal Reserve Board, (iv) by authorizing the Company to withhold from issuance a number of shares issuable upon exercise of the Options which, when multiplied by the fair market value of a Common Shares on the date of exercise, is equal to the aggregate exercise price payable with respect to the Options so exercised or (v) by any combination of the foregoing. Options may also be exercised upon payment of the exercise price of the shares to be acquired by delivery of the optionee’s promissory note, but only to the extent specifically approved by and in accordance with the policies of the Committee.

 

In the event a grantee elects to pay the exercise price payable with respect to an Option pursuant to clause (ii) above, (A) only a whole number of Common Shares (and not fractional Common Shares) may be tendered in payment, (B) such grantee must present evidence acceptable to the Company that he or she has owned any such Common Shares tendered in payment of the exercise price (and that such tendered Common Shares have not been subject to any substantial risk of forfeiture) for at least six months prior to the date of exercise, and (C) Common Shares must be delivered to the Company. Delivery for this purpose may, at the election of the grantee, be made either by (A) physical delivery of the certificate(s) for all such Common Shares tendered in payment of the price, accompanied by duly executed instruments of transfer in a form acceptable to the Company, or (B) direction to the grantee’s broker to transfer, by book entry, of such Common Shares from a brokerage account of the grantee to a brokerage account specified by the Company. When payment of the exercise price is made by delivery of Common Shares, the difference, if any, between the aggregate exercise price payable with respect to the Option being exercised and the fair market value of the Common Shares tendered in payment (plus any applicable taxes) shall be paid in cash. No grantee may tender Common Shares having a fair market value exceeding the aggregate exercise price payable with respect to the Option being exercised (plus any applicable taxes).

 

In the event a grantee elects to pay the exercise price payable with respect to an Option pursuant to clause (iv) above, (A) only a whole number of share(s) (and not fractional shares) may be withheld in payment and (B) such grantee must present evidence acceptable to the Company that he or she has owned a number of Common Shares at least equal to the number of shares to be withheld in payment of the exercise price (and that such owned Common Shares have not been subject to any substantial risk of forfeiture) for at least six months prior to the date of exercise. When payment of the exercise price is made by withholding of shares, the difference, if any, between the aggregate exercise price payable with respect to the Option being exercised and the fair market value of the shares withheld in payment (plus any applicable taxes) shall be paid in cash. No grantee may authorize the withholding of shares having a fair market value exceeding the aggregate exercise price payable with respect to the Option being exercised

(plus any applicable taxes). Any withheld shares shall no longer be issuable under such Option (except pursuant to any Reload Option (as defined below) with respect to any such withheld shares).

 

(f) In the case of an Incentive Stock Option, the amount of the aggregate fair market value of Common Shares (determined at the time of grant of the Option pursuant to subparagraph 5(a) of the Plan) with respect to which incentive stock options are exercisable for the first time by an employee during any calendar year (under all such plans of his employer corporation and its parent and subsidiary corporations) shall not exceed $100,000.

 

(g) It is the intent of the Company that Nonqualified Stock Options granted under the Plan not be classified as Incentive Stock Options, that the Incentive Stock Options granted under the Plan be consistent with and contain or be deemed to contain all provisions required under Section 422 and the other appropriate provisions of the Code and any implementing regulations (and any successor provisions thereof), and that any ambiguities in construction shall be interpreted in order to effectuate such intent.

 

(h) The Committee may provide (either at the time of grant or exercise of an Option), in its discretion, for the grant to a grantee who exercises all or any portion of an Option (“Exercised Options”) and who pays all or part of such exercise price with Common Shares, of an additional Option (a “Reload Option”) for a number of Common Shares equal to the sum (the “Reload Number”) of the number of Common Shares tendered or withheld in payment of such exercise price for the Exercised Options plus, if so provided by the Committee, the number of Common Shares, if any, tendered or withheld by the grantee or withheld by the Company in connection with the exercise of the Exercised Options to satisfy any federal, state or local tax withholding requirements. The terms of each Reload Option, including the date of its expiration and the terms and conditions of its exercisability and transferability, shall be the same as the terms of the Exercised Option to which it relates, except that (i) the grant date for each Reload Option shall be the date of exercise of the Exercised Option to which it relates and (ii) the exercise price for each Reload Option shall be the fair market value of the Common Shares on the grant date of the Reload Option.

 

6.  Stock Appreciation Rights.  The Committee may grant Stock Appreciation Rights either alone, or in conjunction with Stock Options, Performance Grants or other Awards, either at the time of grant or by amendment thereafter. Each Award of Stock Appreciation Rights granted under the Plan shall be evidenced by an instrument in such form as the Committee shall prescribe from time to time in accordance with the Plan and shall comply with the following terms and conditions, and with such other terms and conditions, including, but not limited to, restrictions upon the Award of Stock Appreciation Rights or the Common Shares issuable upon exercise thereof, as the Committee, in its discretion, shall establish:

 

(a) The Committee shall determine the number of Common Shares to be subject to each Award of Stock Appreciation Rights. The number of Common Shares subject to an outstanding Award of Stock Appreciation Rights may be reduced on a share-for-share or other appropriate basis, as determined by the Committee, to the extent that Common Shares under such Award of Stock Appreciation Rights are used to calculate the cash, Common Shares, Other Company Securities or property, or other forms of payment, or any combination thereof, received pursuant to exercise of an Option attached to such Award of Stock Appreciation Rights, or to the extent that any other Award granted in conjunction with such Award of Stock Appreciation Rights is paid.

 

(b) The Award of Stock Appreciation Rights may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of, except by will or the laws of descent and distribution or to a participant’s family member (as defined in General Instruction A.1(a)(5) to Form S-8 under the Securities Act of 1933, as amended, and any successor thereto) by gift or a qualified domestic relations order (as defined in the Internal Revenue Code of 1986, as amended), and shall be exercisable during the grantee’s lifetime only by him. Unless the Committee determines otherwise, the Award of Stock Appreciation Rights shall not be exercisable for at least six months after the date of grant, unless the grantee ceases employment or performance of services before the expiration of such six-month period by reason of his disability as defined in Paragraph 12 or his death.

(c) The Award of Stock Appreciation Rights shall not be exercisable:

 

(i) in the case of any Award of Stock Appreciation Rights which is attached to an Incentive Stock Option granted to a Ten Percent Employee, after the expiration of five years from the date it is granted, and, in the case of any other Award of Stock Appreciation Rights, after the expiration of ten years from the date it is granted. Any Award of Stock Appreciation Rights may be exercised during such period only at such time or times and in such installments as the Committee may establish;

 

(ii) unless the Option or other Award to which the Award of Stock Appreciation Rights is attached is at the time exercisable; and

 

(iii) unless the person exercising the Award of Stock Appreciation Rights has been, at all times during the period beginning with the date of the grant thereof and ending on the date of such exercise, employed by or otherwise performing services for the Company, except that

 

(A) if such person shall cease such employment or performance of services by reason of his disability as defined in Paragraph 12 or early, normal or deferred retirement under an approved retirement program of the Company (or such other plan or arrangement as may be approved by the Committee, in its discretion, for this purpose) while holding an Award of Stock Appreciation Rights which has not expired and has not been fully exercised, such person may, at any time within three years (or such other period determined by the Committee) after the date he ceased such employment or performance of services (but in no event after the Award of Stock Appreciation Rights has expired), exercise the Award of Stock Appreciation Rights with respect to any shares as to which he could have exercised the Award of Stock Appreciation Rights on the date he ceased such employment or performance of services, or with respect to such greater number of shares as determined by the Committee; or

 

(B) if any person to whom an Award of Stock Appreciation Rights has been granted shall die holding an Award of Stock Appreciation Rights which has not expired and has not been fully exercised, his executors, administrators, heirs or distributees, as the case may be, may at any time within one year (or such other period determined by the Committee) after the date of death (but in no event after the Award of Stock Appreciation Rights has expired), exercise the Award of Stock Appreciation Rights with respect to any shares as to which the decedent could have exercised the Award of Stock Appreciation Rights at the time of his death, or with respect to such greater number of shares as determined by the Committee.

 

(d) An Award of Stock Appreciation Rights shall entitle the holder (or any person entitled to act under the provisions of subparagraph 6(c)(iii)(B) hereof) to exercise such Award and surrender unexercised the Option (or other Award), if any, to which the Stock Appreciation Right is attached (or any portion of such Option or other Award) to the Company and to receive from the Company in exchange thereof, without payment to the Company, that number of Common Shares having an aggregate value equal to (or, in the discretion of the Committee, less than) the excess of the fair market value of one share, at the time of such exercise, over the exercise price (or Option Price, as the case may be), times the number of shares subject to the Award or the Option (or other Award), or portion thereof, which is so exercised or surrendered, as the case may be. The Committee shall be entitled in its discretion to elect to settle the obligation arising out of the exercise of a Stock Appreciation Right by the payment of cash or Other Company Securities or property, or other forms of payment, or any combination thereof, as determined by the Committee, equal to the aggregate value of the Common Shares it would otherwise be obligated to deliver. Any such election by the Committee shall be made as soon as practicable after the receipt by the Committee of written notice of the exercise of the Stock Appreciation Right. The value of a Common Share, Other Company Securities or property, or other forms of payment determined by the Committee for this purpose shall be the fair market value thereof on the last business day next preceding the date of the election to exercise the Stock Appreciation Right, unless the Committee, in its discretion, determines otherwise. The exercise price of a Common Share subject to a Stock Appreciation Right shall not be less than the Fair Market Value of a Common Share on the grant date.

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