Exhibit (10)
OWENS-CORNING FIBERGLAS CORPORATION
STOCK PERFORMANCE INCENTIVE PLAN
(as amended on June 15, 1995)
ARTICLE 1. Establishment, Purpose, and Duration
1.1 Establishment of the Plan. Owens-Corning Fiberglas
Corporation, a Delaware corporation (hereinafter referred to as the
"Company"), hereby establishes an incentive compensation plan to be
known as the "Owens-Corning Fiberglas Corporation Stock Performance
Incentive Plan" (such Plan as amended from time to time being
hereinafter referred to as the "Plan"), as set forth in this
document. The Plan permits the grant of Nonqualified Stock
Options, Incentive Stock Options, and Stock Bonuses (including Phantom
Stock Bonuses and Restricted Stock).
The Board of Directors of the Company approved the Plan on January
23, 1992, subject to ratification by an affirmative vote of a
majority of Shares of Common Stock present and entitled to vote at
the 1992 Annual Stockholders Meeting. Following such ratification,
the Plan became effective May 1, 1992 (the "Effective Date"). The
Board of Directors of the Company thereafter amended the Plan on
June 15, 1995, subject to stockholder approval of the amendments at
the 1996 Annual Stockholders Meeting. Provided such approval is
obtained, the Plan as so amended is effective as of June 15, 1995,
and shall remain in effect as provided in Section 1.3 herein.
1.2 Purpose of the Plan. The purpose of the Plan is to promote
the success and enhance the value of the Company by linking the
personal interests of Participants to those of Company
stockholders. The Plan is further intended to provide flexibility
to the Company in its ability to motivate, attract, and retain the
services of Participants upon whose judgment, interest, and special
effort the successful conduct of its operation largely is
dependent.
1.3 Duration of the Plan. The Plan shall commence on the
Effective Date, as described in Section 1.1 herein, and shall
remain in effect, subject to the right of the Board of Directors to
terminate the Plan at any time pursuant to Article 9 herein, until
all Shares subject to it shall have been purchased or acquired
according to the Plan's provisions. However, in no event may an
Award be granted under the Plan on or after the tenth anniversary
of the Plan's Effective Date.
ARTICLE 2. Definitions and Construction
2.1 Definitions. Whenever used in the Plan, the following terms
shall have the meanings set forth below and, when the meaning is
intended, the initial letter of the word is capitalized:
(a) "Affiliates" means any corporation (other than a
Subsidiary), partnership, joint venture, or any other entity in
which the Company owns, directly or indirectly, at least a ten
percent (10%) Beneficial Ownership interest.
(b) "Award" means, individually or collectively, a grant under
this Plan of Nonqualified Stock Options, Incentive Stock Options or
Stock Bonuses (including Phantom Stock Bonuses and Restricted
Stock).
(c) "Beneficial Owner" shall have the meaning ascribed to such
term in Rule 13d-3 of the General Rules and Regulations under the
Exchange Act.
(d) "Board" or "Board of Directors" means the Board of Directors
of Owens-Corning Fiberglas Corporation.
(e) "Cause" means a felony conviction of a Participant or the
failure of a Participant to contest prosecution for a felony, or a
Participant's willful misconduct or dishonesty, any of which is
directly and materially harmful to the business or reputation of
the Company, including any Subsidiary, Parent, or Affiliate.
(f) "Change of Control" of the Company shall be deemed to have
occurred as of the first day any one or more of the following
conditions shall have been satisfied:
(i) Any Person (other than the Company, any Company employee
benefit plan (including its trustee), any Person acting on
behalf of the Company in a distribution of stock to the
public, or any entity owned directly or indirectly by the
stockholders (immediately prior to such transaction) of the
Company in substantially the same proportions as their
ownership of the Company) is or becomes the Beneficial Owner,
directly or indirectly, of securities of the Company
representing fifteen percent (15%) or more of the combined
voting power of the then outstanding securities of the Company
entitled to vote generally in the election of Directors; or
(ii) The occurrence of any transaction or event relating to
the Company that is required to be reported in response to the
requirements of Item 5(f) of Schedule 13E-3 of Regulation 13A
of the Exchange Act; or
(iii) When, during any period of two (2) consecutive years
during the existence of the Plan, the individuals who, at the
beginning of such period, constitute the Board of Directors of
the Company, cease for any reason other than death to
constitute at least a majority thereof, unless each Director
who was not a Director at the beginning of such period was
elected by, or on the recommendation of, at least two-thirds
(2/3rds) of the Directors at the beginning of such period,
provided that any Director elected by or on the recommendation
of at least two-thirds (2/3rds) of the Directors at the
beginning of any such two (2) year period shall be treated as
if he or she had been a Director at the beginning of such
period; or
(iv) The occurrence of a transaction requiring stockholder
approval for the acquisition of the Company by an entity other
than the Company or a Subsidiary through purchase of assets,
or by merger, or otherwise.
(g) "Change-of-Control Price" means the highest price per Share of
Company Common Stock paid in any transaction reported on the New
York Stock Exchange Composite Tape, or paid in any transaction
related to a Potential or actual Change of Control of the Company
at any time during the preceding sixty (60) calendar day period, as
determined by the Committee.
(h) "Code" means the Internal Revenue Code of 1986, as amended
from time to time.
(i) "Committee" means the committee of two (2) or more Directors
appointed by the Board to administer the Plan, as further provided
in Article 3 herein. When used herein, "Committee" shall also
include any person or persons to whom the Committee's authority has
been lawfully delegated pursuant to Article 3.
(j) "Company" means Owens-Corning Fiberglas Corporation, a
Delaware corporation, and any successor thereto as provided in
Article 14 herein.
(k) "Director" means any individual who is a member of the Board
of Directors of the Company.
(l) "Disability" or "Disabled" means disability as determined
under the long-term disability program of the Company, a Subsidiary
or Affiliate applicable to the Employee.
(m) "Employee" means any full-time employee of the Company or a
Subsidiary, including part-time employees or employees who are
represented by a collective bargaining agent with respect to
such employment.
(n) "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor Act thereto.
(o) "Fair Market Value" means, as of any given date, (i) with
respect to Incentive Stock Options, the closing sale price of the
Stock on such date on the New York Stock Exchange Composite Tape;
and (ii) with respect to Nonqualified Stock Options and any other
Awards under the Plan not related to Incentive Stock Options, the
closing sale price of the Stock on such date on the New York Stock
Exchange Composite Tape, or, if (and only if) the Committee in its
discretion so specifies, the average on such date of the closing
price of the Stock on each day on which the Stock is traded over a
period of up to 20 trading days immediately prior to such date.
However, if the foregoing method of determining Fair Market Value
is not consistent with any then applicable regulations of the U.S.
Secretary of the Treasury, then Fair Market Value shall be
determined in accordance with those regulations.
(p) "Incentive Stock Options" or "ISO" means an option to purchase
Shares, granted under Article 6 herein, which the Committee
designates as an Incentive Stock Option and is intended by the
Committee to qualify for the tax treatment applicable to incentive
stock options under Section 422 of the Code.
(q) "Insider" shall mean an Employee whose transactions in equity
securities of the Company are, at the time an Award is made under
this Plan, subject to Section 16 of the Exchange Act.
(r) "Nonqualified Stock Option" or "NQSO" means an option to
purchase Shares, granted under Article 6 herein, which is not
intended by the Committee to qualify for the tax treatment
applicable to incentive stock options under Section 422 of the
Code.
(s) "Option" or "Stock Option" means an Incentive Stock Option or
a Nonqualified Stock Option granted under Article 6 herein.
(t) "Option Price" means the price at which a Share may be
purchased by a Participant pursuant to an Option, as determined by
the Committee, and as further described in Section 6.3 herein.
(u) "Parent" shall have the meaning ascribed to such term in Rule
12b-2 of the General Rules and Regulations under the Exchange Act.
(v) "Participant" means a current or former eligible Employee who
has outstanding an Award granted under the Plan.
(w) "Period of Restriction" means the period during which the
transfer of Shares of Restricted Stock is limited in some way
(based on the passage of time, the achievement of performance
goals, or upon the occurrence of other events as determined by the
Committee, at its discretion), and the Shares are subject to a
substantial risk of forfeiture, as provided in Article 7 herein.
(x) "Person" shall have the meaning ascribed to such term in
Section 3(a)(9) of the Exchange Act and used in Sections 13(d)(3)
and 14(d)(2) thereof, including a "group" as defined in Section
13(d).
(y) "Phantom Stock Bonus Award" means an amount of cash that is
determined by reference to the Fair Market Value of a designated
number of Shares, which is paid to an Employee or which the
Committee agrees to pay to an Employee in the future in lieu of,
or as a supplement to, any other compensation that may have been
earned by services rendered prior to the payment date, subject to
such terms and conditions (if any) as the Committee may impose.
Phantom Stock Bonus Awards are a specific type of Stock Bonus
Award.
(z) "Potential Change of Control" of the Company shall mean the
occurrence of one or more of the following:
(i) The entering into an agreement by the Company, the
consummation of which would result in a Change of Control; or
(ii) The acquisition of Beneficial Ownership, directly or
indirectly, by any Person (other than the Company, any Company
employee benefit plan (including its trustee), any Person
acting on behalf of the Company in a distribution of stock to
the public, or any entity owned directly or indirectly by the
stockholders (immediately prior to the acquisition) of the
Company in substantially the same proportions as their
ownership of the Company) of securities of the Company
representing five percent (5%) or more of the combined voting
power of the Company's then outstanding securities, and the
adoption by the Board of Directors of a resolution to the
effect that a Potential Change of Control of the Company has
occurred for purposes of this Plan.
(aa) "Restricted Stock" means an Award granted to a Participant
pursuant to Article 7 herein.
(bb) "Retirement" means termination of employment with the
Company, its Subsidiaries and Affiliates at or after attainment of
age 55 with a vested retirement benefit under a pension plan of the
Company, a Subsidiary or Affiliate.
(cc) "Share(s)" or "Stock" means the Shares of common stock, $0.10
par value, of Owens-Corning Fiberglas Corporation.
(dd) "Stock Bonus Award" means Shares, or an amount of cash that is
determined by reference to the Fair Market Value of Shares, which
is distributed or paid to an Employee or which the Committee agrees
to distribute or pay in the future in lieu of, or as a supplement
to, any other compensation that may have been earned by services
rendered prior to the distribution or payment date, subject to such
terms and conditions (if any) as the Committee may impose. The
amount of any Stock Bonus Award payable in Shares may but need not
be determined by reference to the Fair Market Value of Stock.
Phantom Stock Bonus Awards and Restricted Stock Awards are specific
types of Stock Bonus Awards.
(ee) "Subsidiary" means any corporation in which the Company owns,
directly or indirectly, at least fifty percent (50%) of the total
combined voting power of all classes of stock, or any other entity
(including, but not limited to, partnerships and joint ventures) in
which the Company owns at least fifty percent (50%) of the combined
equity thereof.
(ff) "Year" or "Plan Year" means each consecutive twelve (12)
month period beginning January 1 and ending December 31.
2.2 Gender and Number. Except where otherwise indicated by the
context, any masculine term used herein also shall include the
feminine, the plural shall include the singular, and the singular
shall include the plural.
2.3 Severability. In the event any provision of the Plan shall be
held illegal or invalid for any reason, the illegality or
invalidity shall not affect the remaining parts of the Plan, and
the Plan shall be construed and enforced as if the illegal or
invalid provision had not been included.
ARTICLE 3. Administration
3.1 The Committee. The Plan shall be administered by the
Compensation Committee of the Board, or by any other Committee
appointed by the Board consisting of not less than two (2)
Directors who are not Employees. Unless the Board determines
otherwise, the Committee shall be comprised exclusively of
Directors who are not Employees and who (i) qualify to administer
the Plan under Rule 16b-3 under the Exchange Act as such Rule may
be in effect from time to time ("SEC Rule 16b-3"), and (ii) are
"outside directors" within the meaning of Section 162(m)(4)(C) of
the Code. The members of the Committee shall be appointed from time
to time by, and shall serve at the discretion of, the Board of
Directors.
3.2 Authority of the Committee. The Committee shall have full
power, subject to the provisions herein, to select Employees to
whom Awards are granted; to determine the size, types, and
frequency of Awards granted hereunder; to determine the terms and
conditions of such Awards in a manner consistent with the Plan; to
establish and administer any performance goals applicable to awards
hereunder and to certify that any such goals are attained; to
construe and interpret the Plan and any agreement or instrument
entered into under the Plan; to establish, amend, or waive rules
and regulations for the Plan's administration; and to amend the
terms and conditions of any outstanding Award to the extent such
terms and conditions are within the discretion of the Committee as
provided in the Plan. Further, the Committee shall make all other
determinations which may be necessary or advisable for the
administration of the Plan. To the extent permitted by law, and to
the extent allowable by SEC Rule 16b-3, the Committee may delegate
its authorities as identified hereunder.
3.3 Rule 16b-3 Requirements; Code Section 162(m). Any provision
of the Plan to the contrary notwithstanding: (i) the Committee may
impose such conditions on any Award as it may determine, on the
advice of counsel, are necessary or desirable to satisfy any
exemption from Section 16 of the Exchange Act for which the Company
intends transactions by Insiders to qualify, including without
limitation SEC Rule 16b-3; (ii) transactions by or with respect to
Insiders shall comply with any applicable conditions of SEC Rule
16b-3 unless the Committee determines otherwise; (iii) transactions
with respect to persons whose remuneration would not be deductible
by the Company but for compliance with the provisions of Section
162(m)(4)(C) of the Code shall conform to the requirements of
Section 162(m)(4)(C) of the Code unless the Committee determines
otherwise; (iv) the Plan is intended to give the Committee the
authority to grant awards that qualify as performance-based
compensation under Code Section 162(m)(4)(C) as well as awards that
do not so qualify; and (v) any provision of the Plan that would
prevent the Committee from exercising the authority referred to in
clause (iv) above or that would prevent an award that the Committee
intends to qualify as performance-based compensation under Code
Section 162(m)(4)(C) from so qualifying or that would prevent any
transaction by or with respect to an Insider from complying with
any applicable condition of SEC Rule 16b-3 with which the Committee
intends such transaction to comply, or that would prevent any
transaction by or with respect to an Insider from qualifying for
any exemption from Section 16 of the Exchange Act for which the
Company intends such transaction to qualify (including SEC Rule 16b-
3), shall be administered, interpreted and construed to carry out
such intention and any provision that cannot be so administered,
interpreted and construed shall to that extent be disregarded.
3.4 Decisions Binding. All determinations and decisions made by
the Committee pursuant to the provisions of the Plan and all
related orders or resolutions of the Board of Directors shall be
final, conclusive, and binding on all persons, including the
Company, its stockholders, Employees, Participants, and their
estates and beneficiaries.
ARTICLE 4. Shares Subject to the Plan
4.1 Number of Shares. Subject to adjustment as provided in
Section 4.2 herein, the total number of Shares available for grant
under the Plan in each calendar year, during any part of which the
Plan is effective, shall be two percent (2%) of the total
outstanding Shares as of the first day of such calendar year;
provided, however, that Shares not granted in any calendar year may
be carried forward and granted in any of the three immediately
subsequent calendar years (in addition to the new Shares made
available in those years). The maximum number of Shares with
respect to which Options may be granted to any Employee in any
calendar year shall be twenty-five percent( 25%) of the total
number of Shares available for grant under the Plan in such
calendar year.
No more than 500,000 Shares may be issued or transferred pursuant
to Incentive Stock Options granted under this Plan. No more than
one-half percent (.5%) of the total outstanding Shares as of the
first day of any calendar year may be granted in that year in the
form of Stock Bonuses (including Phantom Stock Bonuses and
Restricted Stock). However, unused Shares carried forward from
previous years shall retain their character such that this one-half
percent (.5%) limitation shall increase in direct relationship to
those unused Shares reserved for Stock Bonuses in the prior three
years.
The Company may increase the Shares available for Awards in any
calendar year through an advance of up to twenty-five percent (25%)
of the subsequent year's allocation (determined by using twenty-
five percent (25%) of the current year's allocation), with such
Shares retaining their character as to Stock Bonus grant
availability. Any Shares granted hereunder may consist, in whole,
or in part, of authorized and unissued Shares or Treasury Shares or
Shares purchased in the open market or in private transactions for
purposes of the Plan.
4.2 Adjustments in Authorized Shares. In the event of any merger,
reorganization, consolidation, recapitalization, separation,
liquidation, stock dividend, stock split, Share combination, or
other change in the corporate structure of the Company affecting
the Shares, a substitution or adjustment shall be made in the
number and class of Shares which may be delivered under the Plan,
and in the number and class of and/or price of Shares subject to
outstanding Options and Stock Bonus awards (including any
Restricted Stock granted hereunder), as may be determined to be
appropriate and equitable by the Committee, in its sole discretion,
to prevent dilution or enlargement of rights; and further provided
that the number of Shares subject to any Award shall always be a
whole number.
4.3 Charging of Shares. If any Shares subject to
an Award or, in the case of a Phantom Stock Bonus Award, the cash
value of any Shares on which such Award is based, shall not be
issued, transferred or paid to an Employee and shall cease to be
issuable, transferable or payable to an Employee because of the
termination, expiration or cancellation, in whole or in part, of
such Award or for any other reason, or if any such Shares shall,
after issuance or transfer, be reacquired by the Company because of
an Employee's failure to comply with or satisfy the terms and
conditions of an Award, the Shares not so issuable or transferable
or, in the case of a Phantom Stock Bonus Award, the Shares the cash
value of which has ceased to be payable, or the Shares so
reacquired by the Company, as the case may be, shall no longer be
charged against the limitations provided for in section 4.1 above,
may again be made subject to Awards, and shall be added to the
number of Shares available for grant under the Plan in the calendar
year in which the Shares cease to be issuable or transferable, the
cash value ceases to be payable or the Shares are reacquired (as
the case may be).
ARTICLE 5. Eligibility and Participation
5.1 Eligibility. All Employees shall be eligible to be selected
to participate in this Plan, including Employees who are Directors
but excluding Directors who are not Employees.
5.2 Actual Participation. Subject to the provisions of the Plan,
the Committee may, from time to time, select from all eligible
Employees, those to whom Awards shall be granted and shall
determine the nature and amount of each Award. Awards may be made
on a stand-alone basis or in conjunction with other Awards
hereunder. Except as provided otherwise in Section 6.1 below, the
grant of any award may be effective on the date on which the
Committee acts to grant the award or on any earlier or subsequent
date specified by the Committee, and the effective date specified
by the Committee shall be considered the date of grant of the award
for all purposes of this Plan.
ARTICLE 6. Stock Options
6.1 Grant of Options. Subject to the terms and provisions of the
Plan, the Committee may grant Options under this Plan to eligible
Employees at any time and from time to time, whether or not they
are eligible to receive similar or dissimilar incentive
compensation under any other plan or arrangement of the Company.
Options may be granted in the form of ISOs, NQSOs or a combination
thereof. Nothing in this Article 6 shall be deemed to prevent the
grant of NQSOs in excess of the maximum established by Section 422
of the Code. The grant of any option may be effective on the date
on which the Committee acts to grant the option or on any
subsequent date specified by the Committee, and the effective date
specified by the Committee shall be considered the date of grant of
the option for all purposes of this Plan.
6.2 Options to be in Writing. Each Option grant shall be
evidenced in a writing signed by a representative of the Company
duly authorized to do so, that shall specify or incorporate by
reference the Option Price, the duration of the Option, the number
of Shares to which the Option pertains, and such other provisions
as are provided hereunder and any other terms and conditions that
may be imposed by the Committee. The Option instrument also shall
specify whether the Option is an Incentive Stock Option or a
Nonqualified Stock Option.
6.3 Option Price. In no case shall the Option Price of any Option
granted under this Plan be less than one hundred percent (100%) of
the Fair Market Value of a Share on the date the Option is granted.
6.4 Duration of Options. Each Option shall expire at such time as
determined at the time of grant; provided, however, that no Option
shall be exercisable later than the tenth (10th) anniversary date
of its grant.
6.5 Exercise of Options. Options granted under the Plan shall be
exercisable at such times and be subject to such restrictions,
terms and conditions as the Committee shall in each instance
approve, which need not be the same for each grant or for each
Participant. However, except as provided in Article 8 herein, in
no event may any Option granted under this Plan become exercisable
prior to six (6) months following the date of its grant.
Options shall be exercised by the delivery of a written notice of
exercise to the Company, or by giving the Company notice of such
exercise by such other means as the Company may permit in
accordance with applicable law, setting forth the number of Shares
with respect to which the Option is to be exercised, accompanied
by full payment.
The Option Price upon exercise of any Option shall be payable to
the Company in full either: (a) in cash or its equivalent; or (b)
by tendering previously acquired Shares having a Fair Market Value
at the time of exercise equal to the total Option Price (provided
that the Shares which are tendered must have been held by the
Participant for at least six (6) months prior to their tender or
for such other period of time, if any, as the Committee may
direct); or (c) by a combination of (a) and (b).
The Option Price shall also be deemed fully paid if and when the
Company receives documentation that it determines satisfies the
cashless exercise provisions of the Federal Reserve Board's
Regulation T, or when the Option Price is paid by any other means
which the Committee determines to be consistent with the Plan's
purpose and applicable law.
As soon as practicable after receipt of notification of exercise
acceptable to the Company and full payment (including tax
withholding requirements, if any, as further provided in Article 12
herein), the Company shall deliver to the Participant, in the
Participant's name, in the name of the Participant and another
person as joint tenants with rights of survivorship, or in nominee
or street name on behalf of the Participant (as the Participant may
direct and the Committee may permit) Share certificates in an
appropriate amount based upon the number of Shares purchased under
the Option(s).
6.6 Restrictions. At the time of grant, restrictions may be
imposed on any Shares acquired pursuant to the exercise of an
Option under the Plan, including, without limitation, restrictions
under applicable Federal securities laws, under the requirements of
any stock exchange or market upon which such Shares are then listed
and/or traded, and under any blue sky or state securities laws
applicable to such Shares.
6.7 Termination of Employment Due to Death, Disability, or
Retirement.
(a) Termination by Death. In the event the employment of a
Participant with the Company and its Subsidiaries is terminated by
reason of death, any outstanding Options may thereafter be
immediately exercised, to the extent then exercisable (or on such
accelerated basis as the Committee shall determine at or after grant),
by the legal representative of the estate or by the legatee of the
optionee under the will of the optionee, for a period of three
years and six months (or such shorter period as the Committee shall
specify at or after grant) from the date of such death or until the
expiration of the stated term of such Option, whichever period is shorter.
(b) Termination by Disability. If a Participant's employment with
the Company and its Subsidiaries terminates by reason of
Disability, any Stock Option held by such Participant may thereafter
be exercised, to the extent it was exercisable at the time of
termination due to Disability (or on such accelerated basis as the
Committee shall determine at or after grant), but may not be
exercised after (i) three years and six months (or such shorter
period as the Committee shall specify at or after grant) from the
date of such termination of employment, or (ii) the expiration of
the stated term of such Stock Option, whichever period is shorter;
provided, however, that, if the Participant dies within such three-
year-and-six-month period (or such shorter period as the Committee
shall specify at or after grant), any unexercised Stock Option held
by such Participant shall thereafter be exercisable to the extent to
which it was exercisable at the time of death for a period of
twelve months (or such shorter period as the Committee shall
specify at or after grant) from the date of such death or for the
stated term of such Stock Option, whichever period is shorter. If
an Incentive Stock Option is exercised after the expiration of the
exercise periods that apply for purposes of Section 422 of the
Code, such Stock Option shall thereafter be treated as a
Nonqualified Stock Option.
(c) Termination by Retirement. If a Participant's employment with
the Company and its Subsidiaries is terminated by reason of
Retirement, any Stock Option held by such Participant may thereafter
be exercised to the extent it was exercisable at the time of such
Retirement (or on such accelerated basis as the Committee shall
determine at or after grant), but may not be exercised after five
years (or such shorter period as the Committee shall specify at or
after grant) from the date of such termination of employment or the
expiration of the stated term of such Stock Option, whichever
period is shorter; provided, however, that, if the Participant dies
within such five year period (or such shorter period as the
Committee may specify at or after grant), any unexercised Stock
Option held by such Participant shall thereafter be exercisable, to
the extent to which it was exercisable at the time of death, for
the shorter of (i) and (ii) where (i) is a period of twelve months
(or such shorter period as the Committee shall specify at or after
grant) from the date of such death or, if longer, the remainder of
such five year (or shorter) period from the date of such
termination of employment, and (ii) is the expiration of the stated
term of the Stock Option. In the event of termination of
employment by reason of Retirement, if an Incentive Stock Option is
exercised after the expiration of the exercise periods that apply
for purposes of Section 422 of the Code, such Stock Option shall
thereafter be treated as a Nonqualified Stock Option.
6.8 Termination of Employment for Other Reasons. Unless otherwise
determined by the Committee at or after grant, if a Participant's
employment with the Company and its Subsidiaries terminates
voluntarily (other than by reason of Retirement or under
circumstances constituting Cause), the Stock Option shall thereupon
terminate, except that such Stock Option may be exercised to the
extent it was exercisable at the time of termination of employment
for the lesser of one year (or such shorter period as the Committee
may specify at or after grant) from the date of employment
termination or the balance of such Stock Option's term. If a
Participant's employment with the Company and its Subsidiaries is
involuntarily terminated by the Company without Cause, the Option
shall thereupon terminate, except that it may thereafter be
exercised to the extent it was exercisable at the time of
termination of employment (or on such accelerated basis as the
Committee shall determine at or after grant) for the lesser of
three years and six months (or such shorter period as the Committee
may specify at or after grant) from the date of employment
termination or the balance of such Stock Option's term.
If the employment of a Participant shall terminate for Cause, all
outstanding Options held by the Participant immediately shall be
forfeited to the Company and no additional exercise period shall be
allowed, regardless of the vested status of the Options.
6.9 Nontransferability of Options. No Option granted under the
Plan may be sold, transferred, pledged, assigned, or otherwise
alienated or hypothecated, other than by will or by the laws of
descent and distribution. Further, all Options granted to a
Participant under the Plan shall be exercisable during his or her
lifetime only by such Participant. Notwithstanding the foregoing
and any other provision of the Plan to the contrary, if the
Committee so permits, Options may be transferred, following the
death of a Participant, to a beneficiary designated by the
Participant in accordance with Article 10 below.
6.10 Hardship Withdrawal Provision. No Employee shall make any
elective contribution or employee contribution to the Plan (within
the meaning of Treasury Regulation section 1.401(k)-
1(d)(2)(iv)(B)(4)) during the balance of the calendar year after
the Employee's receipt of a hardship distribution from a plan of
the Company or a related party within the provisions of Code
sections 414(b), (c), (m) or (o) containing a cash or deferred
arrangement under section 401(k) of the Code, or during the
following calendar year. The preceding sentence shall not apply if
and to the extent that the Company determines it is not necessary
to qualify any such plan as a cash or deferred arrangement under
section 401(k) of the Code.
ARTICLE 7. Restricted Stock
7.1 Grant of Restricted Stock. Subject to the terms and
provisions of the Plan, Restricted Stock may be granted to eligible
Employees at any time and from time to time, whether or not they
are eligible to receive similar or dissimilar incentive
compensation under any other plan or arrangement of the Company.
The purchase price for Shares of Restricted Stock shall be equal to
their par value per Share.
7.2 Restricted Stock Agreement. Each Restricted Stock grant shall
be evidenced by a Restricted Stock Agreement that shall specify the
Period of Restriction, or Periods, the number of Restricted Stock
Shares granted, and such other provisions as provided hereunder or
as the Committee may impose.
7.3 Nontransferability of Restricted Stock. Except as provided in
this Article 7, the Shares of Restricted Stock granted hereunder
may not be sold, transferred, pledged, assigned, or otherwise
alienated or hypothecated until the end of the applicable Period of
Restriction as specified in the Restricted Stock Agreement and the
satisfaction of any conditions determined at the time of grant and
specified in the Restricted Stock Agreement. However, except as
provided in Article 8 herein, in no event may any Restricted Stock
granted under the Plan become vested in a Participant prior to six
(6) months following the date of its grant. All rights with
respect to the Restricted Stock granted to a Participant under the
Plan shall be available during his or her lifetime only to such
Participant.
7.4 Other Restrictions. The Committee shall impose such other
restrictions on any Shares of Restricted Stock granted pursuant to
the Plan as it may deem advisable including, without limitation, a
required purchase price imposed upon Participants, restrictions
based upon the achievement of specific performance goals (Company-
wide, divisional, and/or individual), and/or restrictions under
applicable Federal or state securities laws; and may legend the
certificates representing Restricted Stock to give appropriate
notice of such restrictions. Further, the Committee at its
discretion, may require that the Shares evidencing such Restricted
Stock grants be held in custody by the Company until any or all
restrictions thereon shall have lapsed.
7.5 Certificate Legend. In addition to any legends placed on
certificates pursuant to Section 7.4 herein, each certificate
representing Shares of Restricted Stock granted pursuant to the
Plan shall bear the following legend:
"The sale or other transfer of the Shares of Stock represented
by this certificate, whether voluntary, involuntary, or by
operation of law, is subject to certain restrictions on
transfer as set forth in the Owens-Corning Fiberglas
Corporation Stock Performance Incentive Plan, and in the
related Restricted Stock Agreement. A copy of the Plan and
such Restricted Stock Agreement may be obtained from the
Secretary of Owens-Corning Fiberglas Corporation."
7.6 Removal of Restrictions. Except as otherwise provided in this
Article 7, Shares of Restricted Stock covered by each Restricted
Stock grant made under the Plan shall become freely transferable by
the Participant after the last day of the Period of Restriction,
provided the applicable conditions to vesting of such Shares have
been fulfilled. Once the Shares are released from the
restrictions, the Participant shall be entitled to have the legend
required by Section 7.5 removed from his or her Share certificate.
7.7 Voting Rights. During the Period of Restriction and prior to
any forfeiture of the Shares, Participants holding Shares of
Restricted Stock granted hereunder may exercise full voting rights
with respect to those Shares.
7.8 Dividends and Other Distributions. During the Period of
Restriction and prior to any forfeiture of the Shares, Participants
holding Shares of Restricted Stock granted hereunder shall be
entitled to receive all dividends and other distributions paid with
respect to those Shares while they are so held. If any such
dividends or distributions are paid in Shares, the Shares shall be
subject to the same restrictions on transferability and
forfeitability as the Shares of Restricted Stock with respect to
which they were paid.
7.9 Termination of Employment. The Committee may but need not provide
at or after the grant of Restricted Stock for the restrictions on all or
any disignated portion of the Shares of Restricted Stock to lapse in
the event of death, Disability, Retirement or other disignated
termination of employment.
ARTICLE 7A. Stock Bonuses
7A.1 Except as otherwise provided in section 15.3, Stock Bonus
Awards shall be subject to the following provisions:
(a) An eligible Employee may be granted a Stock Bonus Award
whether or not he is eligible to receive similar or dissimilar
incentive compensation under any other plan or arrangement of the
Company.
(b) Shares subject to a Stock Bonus Award (other than a Phantom
Stock Bonus Award) may be issued or transferred to an Employee,
and the cash value of the Shares on which a Phantom Stock Bonus
Award is based may be paid to an Employee, at the time such Award
is granted, or at any time subsequent thereto, or in installments
from time to time, and subject to such terms and conditions, as the
Committee shall determine. In the event that any such issuance,
transfer or payment shall not be made to the Employee at the time
such Award is granted, the Committee may but need not provide for
payment to such Employee, either in cash or Shares, from time to
time or at the time or times such Shares shall be issued or
transferred or cash shall be paid to such Employee, of amounts not
exceeding the dividends which would have been payable to such
Employee in respect of such Shares (as adjusted under section 4.2)
if such Shares had been issued or transferred to such Employee at
the time such Award was granted.
(c) Any Stock Bonus Award may, in the discretion of the Committee,
be settled in cash, on each date on which Shares would otherwise
have been delivered or become unrestricted, in an amount equal to
the Fair Market Value on such date of the Shares which would
otherwise have been delivered or become unrestricted. A Phantom
Stock Bonus Award shall be payable only in the form of cash.
Subject to Section 4.3 above, the Shares subject to a Stock Bonus
Award (including a Phantom Stock Bonus Award) shall be deducted
from the number of Shares available for grant under the Plan,
whether the Award is settled in the form of cash or Shares.
(d) Stock Bonus Awards shall be subject to such terms and
conditions, including, without limitation, restrictions on the sale
or other disposition of any Shares to be issued or transferred
pursuant to such Award, and conditions calling for forfeiture of
the Award or the Shares issued or transferred or cash paid pursuant
thereto in designated circumstances, as the Committee shall
determine; provided, however, that upon the issuance or transfer of
Shares to an Employee pursuant to any such Award, the recipient
shall, with respect to such Shares, be and become a shareholder of
the Company fully entitled to receive dividends, to vote and to
exercise all other rights of a stockholder except to the extent
otherwise provided in the Award. All or any portion of a Stock
Bonus Award may but need not be made in the form of a Restricted
Stock Award or a Phantom Stock Bonus Award.
(e) Each Stock Bonus Award shall be evidenced in a writing, signed
by a representative of the Company duly authorized to do so, which shall
be consistent with and subject to this Plan.
ARTICLE 8. Change of Control
8.1 Acceleration and Cashout. Subject to the provisions of
Section 8.2 herein, upon the occurrence of a Change of Control of
the Company, or, if and to the extent so determined by the
Committee in writing at or after grant (subject to any right of
approval expressly reserved by the Committee at the time of such
determination), in the event of a Potential Change of Control of
the Company, unless specifically prohibited by the terms of Article
15 herein:
(a) Any Stock Options awarded under the Plan immediately shall
become fully vested and exercisable;
(b) Any restrictions and other conditions pertaining to
outstanding Stock Bonuses (including Phantom Stock Bonuses and
Restricted Stock), including but not limited to vesting
requirements, immediately shall lapse; and
(c) The value of all outstanding Stock Options and Stock Bonuses
(including Phantom Stock Bonuses and Restricted Stock) shall, to
the extent determined by the Committee at or after grant, be cashed
out by the Company on the basis of the Change-of-Control Price (or,
in the case of Incentive Stock Options, Fair Market Value) as of
the date the Change of Control occurs, or Potential Change
of Control is determined to have occurred, or such other date as
the Committee may determine prior to the occurrence of the Change
of Control or Potential Change of Control.
Notwithstanding the foregoing provisions of this Section 8.1, the
Committee may determine, in its sole discretion, that no Change of
Control or Potential Change of Control shall be deemed to have
occurred with respect to a Participant (i) by reason of any actions
or events ("Interested Actions") in which the Participant acts in a
capacity other than as a director, Officer, or employee of the Company
(or a Subsidiary or Affiliate, where applicable), or (ii) with
respect to any such action or event occurring within 90 days
following the public announcement of any Interested Actions,
regardless of whether the director, officer, or Participant is
interested in such action or event.
8.2 Award Replacement. Notwithstanding Section 8.1 herein, no
acceleration of vesting and exercisability, nor lapse of
restrictions and other conditions, nor cashout shall occur
(pursuant to Sections 8.1(a), (b), and (c) herein) for outstanding
Awards granted hereunder if the Committee reasonably determines in
good faith, prior to the Change of Control or Potential Change of
Control, that such Awards shall be honored or assumed, or new
rights substituted therefor (such honored, assumed, or substituted
award hereinafter called an "Alternative Award") by a Participant's
employer (or the parent or a subsidiary of such employer)
simultaneous with or immediately following the Change of Control or
Potential Change of Control, provided, however, that any such
Alternative Award must:
(a) In the event of Stock Options and Stock Bonuses:
(i) Be based on stock which is traded on an established
securities market, or which will be so traded within thirty
(30) days of the Change of Control or Potential Change of
Control; or
(ii) Have a value based directly upon an objective standard of
valuation (including, but not limited to, a publicly reported
stock index) acceptable to the Committee under the
circumstances and provide each Participant, subject to
requirements as to vesting or lapse of restrictions, with an
opportunity to put the Shares or other securities covered by
the Award to his or her employer (or the parent, general
partner, or a subsidiary of such employer) for purchase with
payment to be made in cash within ten (10) business days of
receipt of such employee's put;
(b) For all Awards:
(i) Provide such Participant (or each Participant in a class
of Participants) with rights and entitlements substantially
equivalent to or better than the rights, terms, and conditions
applicable under such Awards, including, but not limited to,
an identical or better vesting schedule and identical or
better timing and methods of payment;
(ii) Have substantially equivalent economic value to such
Awards (determined at the time of the Change of Control or
Potential Change of Control);
(iii) Have terms and conditions which provide that in the
event the Participant's employment is involuntarily terminated
without Cause or constructively terminated:
(A) Any conditions on a Participant's rights under, or
any restrictions on transfer or exercisability applicable
to, each such Alternative Award shall be waived or shall
lapse, as the case may be; and
(B) Each Participant shall have the right to surrender
such Alternative Awards within thirty (30) days following
such termination in exchange for a payment in cash equal
to the excess of the Fair Market Value of the stock
subject to the Alternative Award over the price, if any,
that a Participant would be required to pay to exercise
such Alternative Award.
For this purpose, a constructive termination shall mean a
termination by a Participant following a material reduction in the
Participant's compensation, a reduction in the Participant's
responsibilities, or the relocation of the Participant's principal
place of employment to another location, in each case without the
Participant's advance written consent.
8.3 Excise Tax Reimbursement. In the event that any
accelerations, lapse of restrictions, cashouts, Award replacements,
and/or any other event under this Plan will cause a Participant to
be subject to the tax (the "Excise Tax") imposed by Section 4999 of
the Code (or any similar tax that may hereafter be imposed), the
Company shall pay to the Participant at the time specified below an
additional amount (the "Gross-up Payment") such that the net amount
retained by the Participant, after deduction of any Excise Tax on
the Total Payments (as hereinafter defined) and any Federal, state,
and local income tax and Excise Tax upon the Gross-up Payment
provided for by this Section 8.3, but before deduction for any
Federal, state, or local income tax on the Total Payments, shall be
equal to the Total Payments.
For purposes of determining whether any Participant will be subject
to the Excise Tax and the amount of such Excise Tax:
(a) Any other payments or benefits received or to be received by a
Participant in connection with a Change of Control of the Company
or a Participant's termination of employment (whether pursuant to
the terms of this Plan or any other plan, arrangement, or agreement
with the Company, any Person whose actions result in a Change of
Control of the Company or any Person affiliated with the Company or
such Person) (which together with the benefits and/or payments
provided hereunder, shall constitute the "Total Payments") shall be
treated as "parachute payments" within the meaning of Section
280G(b)(2) of the Code, and all "excess parachute payments" within
the meaning of Section 280G(b)(1) of the Code shall be treated as
subject to the Excise Tax unless, in the opinion of tax counsel
selected by the Committee, such other payments or benefits (in
whole or in part) do not constitute parachute payments, or such
excess parachute payments (in whole or in part) represent
reasonable compensation for services actually rendered within the
meaning of Section 280G(b)(4) of the Code in excess of the base
amount within the meaning of Section 280G(b)(3) of the Code or are
otherwise not subject to the Excise Tax;
(b) The amount of the total Payments which shall be treated as
subject to the Excise Tax shall be equal to the lesser of: (A) the
total amount of the Total Payments; or (B) the amount of excess
parachute payments within the meaning of Section 280G(b)(1) of the
Code (after applying clause (a) above); and
(c) The value of any noncash benefits or any deferred payment or
benefit shall be determined by the Company's independent auditors
in accordance with the principles of Section 280G(d)(3) of the
Code.
For purposes of determining the amount of the Gross-Up Payment, a
Participant shall be deemed to pay Federal income taxes at the
highest marginal rate of Federal income taxation for the calendar
year in which the Gross-Up Payment is to be made and the applicable
state and local income taxes at the highest marginal rate of
taxation for the calendar year in which the Gross-Up Payment is to
be made, net of the maximum reduction in Federal income taxes which
could be obtained from deduction of such state and local taxes. In
the event that the Excise Tax is subsequently determined to be less
than the amount taken into account hereunder at the time the Gross-
Up Payment is made, a Participant shall repay to the Company at the
time that the amount of such reduction in Excise Tax is finally
determined the portion of the Gross-Up Payment attributable to such
reduction (plus the portion of the Gross-Up Payment attributable to
the Excise Tax and Federal, state and local income tax imposed on
the portion of the Gross-Up Payment being repaid by a Participant
if such repayment results in a reduction in Excise Tax and/or a
Federal, state, and local income tax deduction), plus interest on
the amount of such repayment at the rate provided in Section
1274(b)(2)(B) of the Code. In the event that the Excise Tax is
determined to exceed the amount taken into account hereunder at the
time the Gross-Up Payment is made (including by reason of any
payment the existence or amount of which cannot be determined at
the time of the Gross-Up Payment), the Company shall make an
additional Gross-Up Payment in respect of such excess (plus any
interest payable with respect to such excess) at the time that the
amount of such excess is finally determined.
The Gross-Up Payment or portion thereof provided for in this
Section 8.3 shall be paid no later than the thirtieth (30th)
calendar day following payment of any amounts under this section,
provided, however, that if the amount of such Gross-Up Payment or
portion thereof cannot be finally determined on or before such day,
the Company shall pay to a Participant on such day an estimate, as
determined in good faith by the Company, of the minimum amount of
such payments and shall pay the remainder of such payments
(together with interest at the rate provided in Section
1274(b)(2)(B) of the Code) as soon as the amount thereof can be
determined, but in no event later than the forty-fifth (45th)
calendar day after payment of any amounts under this Section 8.3.
In the event that the amount of the estimated payments exceeds the
amount subsequently determined to have been due, such excess shall
constitute a loan by the Company to each Participant, payable on
the fifth (5th) calendar day after demand by the Company (together
with interest at the rate provided in Section 1274(b)(2)(B) of the
Code).
ARTICLE 9. Amendment, Modification and Termination
9.1 Amendment and Termination. The Board may, at any time and
from time to time, amend or modify the Plan in any respect without
stockholder approval, unless approval of the amendment
or modification in question is required under Delaware law, the
Code (including without limitation Code section 162(m)(4) and Code
Section 422 and Treasury regulations issued or proposed thereunder),
any applicable exemption from Section 16 of the
Exchange Act (including without limitation SEC Rule 16b-3) for
which the Company intends transactions by Insiders to qualify, any
national securities exchange or system on which the Stock is then
listed or reported, by any regulatory body having jurisdiction with
respect to the Plan, or under any other applicable laws, rules or
regulations. The Board may also terminate the Plan at any time.
The Committee may amend the terms of any Award granted under the
Plan, prospectively or retroactively, but no such amendment shall
impair the rights of any Participant without such Participant's
consent.
9.2 Awards Previously Granted. No termination, amendment or
modification of the Plan shall in any manner adversely affect any
Award previously granted under the Plan, without the written
consent of the Participant holding such Award
ARTICLE 10. Beneficiary Designation
The Committee may (but need not) permit a Participant, from time to
time and subject to such terms and conditions as it may impose, to
name a beneficiary or beneficiaries (who may be named contingently
or successively) to whom any benefit under the Plan is to be paid
in case of his or her death before he or she receives any or all of
such benefit. Each such designation shall revoke all prior
designations by the same Participant, shall be in a form prescribed
by the Company, and will be effective only when filed by the
Participant in writing with the Human Resource Department of the
Company during the Participant's lifetime. In the absence of any
such designation, benefits remaining unpaid at the Participant's
death shall be paid to the Participant's estate.
ARTICLE 11. Rights of Employees; Other Plans and Arrangements
11.1 Employment. Nothing in the Plan shall interfere with or limit
in any way the right of the Company to terminate any Participant's
employment at any time, nor confer upon any Participant any right
to continue in the employ of the Company.
For purposes of the Plan, transfer of employment of a Participant
between the Company and any one of its Subsidiaries or Affiliates
(or between Subsidiaries and Affiliates) shall not be deemed a
termination of employment.
11.2 Participation. No Employee shall have the right to be
selected to receive an Award under this Plan, or, having been so
selected, to be selected to receive a future Award.
11.3 Transferability Restriction. Any derivative security issued
under this Plan (within the meaning of SEC Rule 16b-3(a)(2)) is not
transferable by the participant other than by will or the laws of
descent and distribution. Notwithstanding the foregoing and any
other provision of the Plan to the contrary, if the Committee so
permits, an award under this Plan may be transferred, following the
death of a Participant, to a beneficiary designated by the
Participant in accordance with Article 10 above.
11.4 Other Plans and Arrangements. Nothing in this Plan is
intended to be a substitute for, or shall preclude or limit the
establishment or continuation of, any other plan, practice or
arrangement for the payment of compensation or fringe benefits to
directors, officers, or employees generally, or to any class or
group of such persons, which the Company or any Subsidiary now has
or may hereafter lawfully put into effect, including, without
limitation, any incentive compensation, retirement, pension, group
insurance, restricted stock, stock purchase, stock bonus, stock
incentive or stock option plan.
ARTICLE 12. Withholding
12.1 Tax Withholding. A Participant shall remit to the Company an
amount sufficient to satisfy any taxes the Company determines are
required by law to be withheld with respect to any grant, exercise,
or payment made under or as a result of this Plan.
12.2 Share Withholding. With respect to withholding required upon
the exercise of Options, upon the lapse of restrictions on
Restricted Stock, or upon any other taxable event hereunder, the
Committee may permit or require Participants, subject to such terms
and conditions as it may impose, to satisfy the withholding
requirement, in whole or in part, by having the Company withhold
Shares having a Fair Market Value on the date the tax is to be
determined equal to the maximum marginal total tax which could be
imposed on the transaction or such greater or lesser amount as the
Committee may permit. If the Committee so provides, such Shares
withheld may be already owned Shares which the Participant tenders
in satisfaction of the withholding requirement or Shares issuable
by the Company in connection with the exercise of Options, the
lapse of restrictions on Restricted Stock or the other taxable
event hereunder, or Shares from any other source.
ARTICLE 13. Indemnification
No member of the Board or the Committee, nor any officer or
employee of the Company acting on behalf of the Board or the
Committee, shall be personally liable for any action,
determination, or interpretation taken or made in good faith with
respect to the Plan, and all members of the Board or the Committee
and each and any officer or employee of the Company acting on their
behalf shall, to the extent permitted by law, be fully indemnified
and protected by the Company in respect of any such action,
determination or interpretation.
ARTICLE 14. Successors
All obligations of the Company under the Plan, with respect to
Awards granted hereunder, shall be binding on any successor to the
Company, whether the existence of such successor is the result of a
direct or indirect purchase, merger, consolidation, or otherwise,
of all or substantially all of the business and/or assets of the
Company.
ARTICLE 15. Requirements of Law
15.1 Requirements of Law. The granting of Awards and the issuance
of Shares under the Plan shall be subject to all applicable laws,
rules, and regulations, and to such approvals by any governmental
agencies or national securities exchanges, as the Company may
determine apply.
15.2 Governing Law. To the extent not preempted by Federal law,
the Plan, and all agreements hereunder, shall be construed in
accordance with and governed by the laws of the State of Delaware,
without reference to the principles of conflicts of laws of that
State.
15.3 Non-U.S. Laws. In the event the laws of a foreign country,
in which the Company, a Subsidiary or Affiliate has Employees,
prescribe certain requirements for stock incentives to qualify for
advantageous treatment under the tax or other laws or regulations
of that country, the proper officers of the Company, may restate,
in whole or in part, this Plan and may include in such restatement
additional provisions for the purpose of qualifying the restated
plan and stock incentives granted thereunder under such laws and
regulations; provided, however, that (a) the terms and conditions
of any stock-based incentive granted under such restated plan may
not be more favorable to the recipient than would be permitted if
such stock-based incentive had been granted under the Plan as
herein set forth, (b) all Shares allocated to or utilized for the
purposes of such restated plan shall be subject to the limitations
of Article 4, and (c) the provisions of the restated plan may give
the Board less but not more discretion to amend or terminate such
restated plan than is provided with respect to this Plan by the
provisions of Article 9 hereof.