EXHIBIT EX-10.4
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TRANSAMERICA CORPORATION
TANDEM LIMITED STOCK APPRECIATION RIGHT AGREEMENT
In connection with the grant under the Transamerica Corporation 1995
Performance Stock Option Plan (the "Plan") of a nonqualified stock option to
purchase shares of common stock of Transamerica Corporation ("Shares") at a
purchase price per Share of $[NUMBER] (the "Related Option"), Transamerica
Corporation (the "Company") hereby grants you, [NAME] (the "Employee"), a
tandem limited stock appreciation right (a "TLSAR") under the Plan, to
surrender all or part of the unexercised portion of the Related Option in
exchange for a payment from the Company pursuant to this TLSAR. The date of
this Agreement is [DATE] (the "Grant Date"). In general, the latest date this
TLSAR is exercisable is [DATE] (the "Expiration Date"). However, as provided
in Appendix A (attached hereto), this TLSAR may expire earlier than the
Expiration Date. Subject to the provisions of Appendix A and of the Plan, the
principal features of this TLSAR are as follows:
Number of Shares to
Which this TLSAR Pertains: [NUMBER] Exercise Price per Share: $[NUMBER]
Scheduled Vesting Date: The date on which a Change of Control occurs.
Event Triggering Maximum Time to Exercise
Termination of TLSAR After Triggering Event*
Termination of Employment (except as shown
below) 3 months
Termination of Employment due to Disability 3 years
Termination of Employment due to Early or
Normal Retirement 5 years
Death (prior to expiration of option) 3 years
Change of Control 60 days
Failure of the Related Option to Vest None
Exercise of the Related Option None
* However, in no event may this TLSAR be exercised after the Expiration
Date (except in certain cases of the death of the Employee).
Your signature below indicates your agreement and understanding that this
TLSAR is subject to all of the terms and conditions contained in Appendix A
and the Plan. For example, important additional information on vesting and
termination of this TLSAR is contained in Paragraphs 4 through 6 of Appendix
A. ACCORDINGLY, PLEASE BE SURE TO READ ALL OF APPENDIX A, WHICH CONTAINS THE
SPECIFIC TERMS AND CONDITIONS OF THIS TLSAR.
TRANSAMERICA CORPORATION EMPLOYEE
By
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APPENDIX A
TERMS AND CONDITIONS OF TANDEM LIMITED STOCK APPRECIATION RIGHTS
1. Grant of TLSAR. The Company hereby grants to the Employee
under the Plan, in connection with the grant of the Related Option, and as a
separate incentive in connection with his or her employment and not in lieu of
any salary or other compensation for his or her services, a TLSAR pertaining
to all or any part of an aggregate of [NUMBER] Shares, which TLSAR entitles
the Employee to surrender, on the terms and conditions set forth in this
Agreement and the Plan, all or part of the Related Option in exchange for a
payment from the Company in the amount determined under Paragraph 9 below.
2. Exercise Price. The exercise price per Share for this TLSAR
(the "Exercise Price") shall be $[NUMBER], which is equal to the Fair Market
Value per Share on the Grant Date.
3. Number of Shares. The number and class of Shares specified in
Paragraph 1 above, and/or the Exercise Price, are subject to appropriate
adjustment in the event of any merger, reorganization, consolidation,
recapitalization, separation, liquidation, stock dividend, split-up, Share
combination, distribution or other change in the corporate structure of the
Company affecting the Shares; provided, however, that the number of Shares
subject to this TLSAR shall always be a whole number. Subject to any required
action of the stockholders of the Company, if the Company is the surviving
corporation in any merger or consolidation, this TLSAR (to the extent that it
is still outstanding) shall pertain to and apply to the securities to which a
holder of the same number of Shares that are then subject to the TLSAR would
have been entitled.
4. Vesting Schedule. The right to exercise this TLSAR will vest
as to 100% of the Shares subject to the TLSAR upon the occurrence of a Change
of Control, provided that (a) vesting will occur only if the Employee is an
Executive on the date of the Change of Controls, and (b) if the Employee is a
Section 16 Person, the right to exercise this TLSAR may not become vested
until at least six (6) months after the Grant Date. Notwithstanding clause
(b) of the preceding sentence, in the event of the Employee's Termination of
Employment due to Normal Retirement, Disability or death, (i) if the right to
exercise this TLSAR would have vested within six (6) months after such
Termination of Employment (had the Employee not incurred a Termination of
Employment), then the right to exercise this TLSAR will vest on the date that
such right otherwise would have vested, and (ii) if the right to exercise this
TLSAR would have vested more than six (6) months after such Termination of
Employment (had the Employee not incurred a Termination of Employment), then
the right to exercise this TLSAR will vest on the date that such right
otherwise would have vested, as determined in the discretion of the Committee
based on the time elapsed from the Grant Date to the Termination of Employment
and the vesting date.
5. Termination of TLSAR. In the event of the Employee's
Termination of Employment for any reason other than Early or Normal
Retirement, Disability or death, the Employee may, within three (3) months
after the date of such Termination, or prior to the Expiration Date,
whichever shall first occur, exercise this TLSAR (if then vested). In the
event of the Employee's Termination of Employment due to Disability, the
Employee may, within three (3) years after the date of such Termination, or
prior to the Expiration Date, whichever shall first occur, exercise this
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TLSAR (if then vested). In the event of the Employee's Termination of
Employment due to Early or Normal Retirement, the Employee may, within five
(5) years from the date of such Termination, or prior to the Expiration Date,
whichever shall first occur, exercise this TLSAR (if then vested). In
addition, this TLSAR shall terminate on the first to occur of the following:
(a) the first date on which the Related Option no longer may become
exercisable, (b) the last day of the period of sixty (60) consecutive days
which begins on the date of a Change of Control, or (c) upon exercise of the
Related Option (but only to the extent provided in the following sentence).
For each Share with respect to which the Related Option is exercised, the
right to exercise [NUMBER] of the Shares subject to this TLSAR shall
immediately terminate, provided that the number of Shares which so terminate
shall be rounded to the nearest whole number (or to such number as is
appropriate to ensure that the total number of shares covered by this TLSAR
does not exceed the number specified in Paragraph 1 above).
6. Death of Employee. In the event that the Employee dies prior
to the expiration of this TLSAR in accordance with the provisions of Paragraph
5 above, the Employee's designated beneficiary or beneficiaries, or if no
beneficiary survives the Employee, the administrator or executor of the
Employee's estate, nevertheless may, within three (3) years after the date of
death, exercise any vested but unexercised portion of the TLSAR, but only to
the extent that such right was transferred with respect to the Related Option.
Any such transferee must furnish the Company (a) written notice of his or her
status as a transferee of this TLSAR, (b) evidence satisfactory to the Company
to establish the validity of the transfer of this TLSAR and compliance with
any laws or regulations pertaining to such transfer, and (c) written
acceptance of the terms and conditions of this TLSAR as set forth in this
Agreement.
7. Persons Eligible to Exercise TLSAR. This TLSAR shall be
exercisable during the Employee's lifetime only by the Employee. This TLSAR
is not transferable, except that the Employee may transfer this TLSAR (a) by a
valid beneficiary designation made in a form and manner acceptable to the
Committee, or (b) by will or the applicable laws of descent and distribution,
in which case this TLSAR shall be transferred to the same extent. Any such
transfer shall be effective only if the Related Option also is transferred to
the same transferee.
8. Notice of Exercise of TLSAR. This TLSAR may be exercised by
the person then entitled to do so as to any portion of the TLSAR which may
then be exercised by giving written notice of exercise to the Secretary of the
Company (or his or her designee) specifying the number of full Shares with
respect to which the TLSAR is to be exercised.
9. Payment of TLSAR Amount. Upon exercise of this TLSAR, the
Employee shall be entitled to receive payment from the Company in an amount
(the "TLSAR Amount") determined by multiplying:
(a) The amount by which the Change of Control Value (as defined
below) of a Share on the date of exercise exceeds the Exercise Price,
times
(b) The number of Shares with respect to which the TLSAR is
exercised.
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For this purpose, the "Change of Control Value" of a Share shall mean the
greater of (i) the highest Fair Market Value of a Share during the period of
60 consecutive days which ends on the date of a Change of Control, or (ii) the
highest price per Share paid in the transaction which gives rise to the Change
of Control.
10. Form of Payment of TLSAR Amount. The TLSAR Amount shall be
paid in cash, unless the Committee determines that such payment (or portion
thereof) would cause a transaction which gives rise to the Change of Control
to be ineligible for pooling of interests accounting under APB No. 16, which
transaction (but for such payment) otherwise would have been eligible for such
accounting treatment, in which case the Committee may determine that the TLSAR
Amount shall be paid in Shares of equivalent value. Prior to any payment of
the TLSAR Amount, the Company shall deduct or withhold, or require the
Employee to remit to the Company, an amount sufficient to satisfy any
withholding taxes required to be withheld with respect to the payment.
11. No Rights of Stockholder. Neither the Employee (nor any
beneficiary) shall be or have any of the rights or privileges of a stockholder
of the Company in respect of any of the Shares issuable pursuant to the
exercise of this TLSAR, unless and until certificates representing such Shares
shall have been issued, recorded on the records of the Company or its transfer
agents or registrars, and delivered to the Employee (or beneficiary).
12. No Effect on Employment. The Employee's employment with the
Company and its Affiliates is on an at-will basis only. Accordingly, the
terms of the Employee's employment with the Company and its Affiliates shall
be determined from time to time by the Company or the Affiliate employing the
Employee (as the case may be), and the Company or the Affiliate shall have the
right, which is hereby expressly reserved, to terminate or change the terms of
the employment of the Employee at any time for any reason whatsoever, with or
without good cause. For purposes of this Agreement, the transfer of
employment of the Employee between the Company and any one of its Affiliates
(or between Affiliates) shall not be deemed a Termination of Employment.
13. Address for Notices. Any notice to be given to the Company
under the terms of this Agreement shall be addressed to the Company, in care
of its Secretary, at 600 Montgomery Street, San Francisco, California 94111,
or at such other address as the Company may hereafter designate in writing.
14. TLSAR is Not Transferable. Except as otherwise provided in
Paragraphs 6 and 7 above, this TLSAR and the rights and privileges conferred
hereby may not be transferred, pledged, assigned or otherwise hypothecated in
any way (whether by operation of law or otherwise) and shall not be subject to
sale under execution, attachment or similar process. Upon any attempt to
transfer, pledge, assign, hypothecate or otherwise dispose of this TLSAR, or
of any right or privilege conferred hereby, or upon any attempted sale under
any execution, attachment or similar process, this TLSAR and the rights and
privileges conferred hereby immediately shall become null and void.
15. Maximum Term of TLSAR. Notwithstanding any other provision of
this Agreement except Paragraph 6 above relating to the death of the Employee
(in which case the TLSAR is exercisable to the extent set forth therein), this
TLSAR is not exercisable after the Expiration Date.
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16. Binding Agreement. This Agreement shall be binding upon and
inure to the benefit of the heirs, legatees, legal representatives, successors
and assigns of the parties hereto.
17. Conditions to Exercise. Exercise of this TLSAR will not be
permitted until arrangements (satisfactory to the Company) have been made by
the Employee for the payment of the amount of taxes required (as determined by
the Company) to be withheld by reason of such exercise.
18. Plan Governs. This Agreement is subject to all of the terms
and provisions of the Plan. In the event of a conflict between one or more
provisions of this Agreement and one or more provisions of the Plan, the
provisions of the Plan shall govern. Capitalized terms and phrases used and
not defined in this Agreement shall have the meaning set forth in the Plan.
19. Committee Authority. The Committee shall have all discretion,
power, and authority to interpret the Plan and this Agreement and to adopt
such rules for the administration, interpretation and application of the Plan
as are consistent therewith. All actions taken and all interpretations and
determinations made by the Committee in good faith shall be final and binding
upon the Employee, the Company and all other interested persons, and shall be
given the maximum deference permitted by law. No member of the Committee
shall be personally liable for any action, determination or interpretation
made in good faith with respect to the Plan or this Agreement.
20. Captions. The captions provided herein are for convenience
only and are not to serve as a basis for the interpretation or construction of
this Agreement.
21. Agreement Severable. In the event that any provision in this
Agreement shall be held invalid or unenforceable, such provision shall be
severable from, and such invalidity or unenforceability shall not be construed
to have any effect on, the remaining provisions of this Agreement.
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