EXHIBIT 10.8
VARIABLE COMPENSATION PLAN
Originally Adopted - February 3, 1905
Last Amended - November 24, 1993
E. I. DU PONT DE NEMOURS AND COMPANY
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VARIABLE COMPENSATION PLAN
I. PURPOSES
The purposes of this Variable Compensation Plan (the
"Plan") are: (a) to provide greater incentive for employees
continually to exert their best efforts on behalf of E. I.
du Pont de Nemours and Company (the "Company") by granting them
compensation that, combined with their regular salaries, results
in total compensation that is competitive based on performance;
and (b) to further the identity of interests of such employees
with those of the Company's stockholders generally.
II. FORM OF GRANTS
1. Variable compensation under this Plan may be granted
in acquired common stock of this Company, or in new
common stock to be issued directly to the
beneficiaries, or in cash, or in two or more of said
forms.
2. The Compensation and Benefits Committee shall
determine the portion of each award under this Plan
to be paid in cash and the portion to be delivered to
the beneficiary in the form of common stock.
III. LIMITATIONS ON GRANTS
1. Grants under this Plan shall be made from the
Variable Compensation Fund which the Company shall
establish and to which shall be credited annually an
amount to be determined by the Compensation and
Benefits Committee. This amount shall not exceed 20%
of the "variable net income."
2. The term "variable net income" for any year, as used
in this Plan, shall mean the amount of net income as
shown in the Consolidated Income Statement of this
Company and its subsidiaries set forth in the Annual
Report to the Stockholders for such year, with
adjustments for any significant items of income or
loss which the Compensation and Benefits Committee in
its discretion may deem appropriate; further adjusted
by
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(a) adding any amount which has been deducted in
computing said net income with respect to any
provision for the Variable Compensation Fund,
and
(b) deducting an amount equal to 6% of the "variable
net capital employed," as defined in paragraph 3
of this Article.
3. The term "variable net capital employed" for any
year, as used in this Plan, shall mean the average of
the amounts of Stockholders' Equity as of
December 31st of such year and December 31st of the
preceding year, as shown in the Consolidated Balance
Sheets of this Company and its subsidiaries set forth
in the Annual Reports to the Stockholders, after
adjusting said amounts, however, by adding to
Stockholders' Equity as stated in the later of such
Balance Sheets any amount which has been deducted in
computing net income with respect to any provision
for the Variable Compensation Fund, as described in
paragraph 2(a) of this Article.
4. Grants for each year need not have an aggregate value
equal to the entire amount available in the Variable
Compensation Fund. Any ungranted portion of the Fund
shall be carried forward and be available for grants
in a succeeding year or years, and while grants in
the aggregate for any year may exceed the amount
credited for that year to the Variable Compensation
Fund, they shall not exceed the total amount in the
Fund.
IV. ADMINISTRATION
1. Except as otherwise specifically provided, the Plan
shall be administered by the Compensation and
Benefits Committee of the Company's Board of
Directors. The Compensation and Benefits Committee
shall be elected pursuant to the Bylaws of the
Company, and the members thereof shall be ineligible
for grants for services performed while serving on
said Committee.
2. The decision of the Compensation and Benefits
Committee with respect to any questions arising as to
interpretation of this Plan, including the sever-
ability of any and all of the provisions thereof,
shall be final, conclusive and binding.
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V. ELIGIBILITY FOR GRANTS
1. Grants under the Plan may be made to those employees
who have contributed the most in a general way to the
Company's success by their ability, efficiency, and
loyalty, consideration being given to ability to
succeed in more important managerial responsibility
in the Company. Grants may also be made to:
(a) a person performing services on a consultant
basis,
(b) an employee who retired or plans to retire
pursuant to the provisions of the pension and
retirement plan or policy of a plan company,
(c) a former employee, and
(d) the surviving spouse or estate of a deceased
employee.
No grant may be made to a director except for
services performed as an employee of a plan company.
2. Except as set forth in subparagraphs (a) to (d) of
the preceding paragraph, to be eligible for a grant
an employee shall be employed by a plan company as of
the date final action is taken on a grant under this
Plan and shall be expected to continue in the employ
of such a company. Except in special cases, any
employee receiving a grant shall have been in the
continuous employ of a plan company at least two
years on January 1st of the year in which the grant
is being made.
3. For purposes of this Plan, the term "employee" shall
include an employee of a corporation or other
business entity in which the Company shall directly
or indirectly own fifty percent or more of the
outstanding voting stock or other ownership interest.
The term "plan company" as used in this Plan shall
mean a business entity whose employees are eligible
for grants under this Plan.
VI. GRANTS
1. The Compensation and Benefits Committee shall
determine each year the total amount of the Variable
Compensation Fund to be distributed. Grants for any
calendar year shall be made as soon as practicable
after the close of such calendar year.
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2. Employees in countries other than the United States
may be granted variable compensation through plans or
programs other than this Plan.
VII. STOCK FOR GRANTS
1. With respect to the portion of grants under this Plan
to be delivered in common stock, the Compensation and
Benefits Committee of the Company's Board of
Directors shall determine whether, and to what
extent, such portion of the grants shall be in new
common stock to be issued directly to beneficiaries,
or in common stock acquired by the Company.
2. The value per share at which common stock is to be
granted to beneficiaries under this Plan shall be
fixed and determined by the Board of Directors.
Common stock to be delivered in payment of grants
under this Plan shall be issued or registered in the
names of beneficiaries at the time of delivery
provided under Article IX hereof.
VIII. RECOMMENDATIONS AND GRANTS
1. Recommendations for grants to members of the Board of
Directors shall be made by the Compensation and
Benefits Committee. Recommendations for grants to
employees who are not members of the Board of
Directors shall be made to the Compensation and
Benefits Committee by the Office of the Chairman.
2. Any grant to a director shall be made in the sole
discretion of the Board of Directors, a majority of
whose members taking final action on any such grant
shall be ineligible for grants under Article V. Any
grant to an employee who is not a member of the Board
of Directors shall be made in the sole discretion of
the Compensation and Benefits Committee which shall
take final action on any such grant. No person shall
have a right to a grant under this Plan until final
action has been taken to make such grant. At the
discretion of the Compensation and Benefits
Committee, grants to employees of a plan company may
be made subject to approval by the board of directors
or other management group of such company.
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3. Action to establish a minimum liability for variable
compensation grants under this Plan, if deemed
appropriate, shall be taken by the Compensation and
Benefits Committee prior to year-end of the calendar
year for which grants are to be made.
VIII. DELIVERY OF GRANTS
When any stock or cash is granted under this Plan,
certificates of stock, or cash, as the case may be, representing
such grant, shall be delivered to the beneficiary promptly, or
at such future times and under such terms and conditions as the
Compensation and Benefits Committee may determine. If it is
determined that the grant be delivered promptly to the bene-
ficiary, that beneficiary may be given the option to defer
delivery of the grant to the extent provided in terms and
conditions established by the Compensation and Benefits
Committee.
IX. AMENDMENTS
While it is the present intention of the Company to make
grants annually, the Board of Directors reserves the right to
modify this Plan from time to time or to repeal the Plan
entirely, or to direct the discontinuance of making grants
either temporarily or permanently; provided, however, that no
modification of this Plan shall operate to annul, without the
consent of the beneficiary, a grant already made hereunder;
provided, also, that no modification without approval of the
stockholders shall increase the maximum amount which may be
credited to the Variable Compensation Fund as hereinabove
provided.
XI. MISCELLANEOUS
All expenses and costs in connection with the operation
of this Plan shall be borne by the Company and no part thereof
shall be charged against the Variable Compensation Fund.
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