EXHIBIT 10.15.1
1994 UNION CARBIDE LONG-TERM INCENTIVE PLAN
SECTION 1: PURPOSE. The purpose of the 1994 Union Carbide Long-Term Incentive
Plan (hereinafter referred to as the "Plan") is to (a) advance the interests of
Union Carbide Corporation (the "Corporation") and its stockholders by providing
incentives and rewards to those employees who are in a position to contribute to
the long-term growth and profitability of the Corporation; (b) assist the
Corporation and its subsidiaries and affiliates in attracting, retaining, and
motivating highly qualified employees for the successful conduct of their
business; and (c) make the Corporation's compensation program competitive with
those of other major employers.
SECTION 2: DEFINITIONS.
2.1 A "Change in Control of the Corporation" shall be deemed to occur
in the event that any of the following circumstances have occurred:
(i)if a change in control of the Corporation would be required
to be reported in response to Item 1(a) of the Current
Report on Form 8-K as in effect on the date hereof,
pursuant to Sections 13 or 15(d)of the Exchange Act,
whether or not the Corporation is then subject to such
reporting requirement;
(ii) any "person" or "group" within the meaning of Sections
13(d) and 14(d)(2) of the Exchange Act (x) becomes the
"beneficial owner", as defined in rule 13d-3 under the
Exchange Act, of more than 20% of the then outstanding
voting securities of the Corporation, otherwise than
through a transaction or transactions arranged by, or
consummated with the prior approval of, the Board or (y)
acquires by proxy or otherwise the right to vote for the
election of directors, for any merger or consolidation of
the Corporation or for any other matter or question, more
than 20% of the then outstanding voting securities of the
Corporation, otherwise than through an arrangement or
arrangements consummated with the prior approval of the
Board;
(iii)if during any period of twenty-four consecutive months (not
including any period prior to the adoption of this
section), Present Directors and/or New Directors cease for
any reason to constitute a majority of the Board.
For purposes of this subsection (iii), "Present Directors"
shall mean individuals who at the beginning of such
consecutive twenty-four month period were members of the
Board and "New Directors" shall mean any director whose
election by the Board or whose nomination for election by
the Corporation's stockholders was approved by a vote of at
least two-thirds of the Directors then still in office who
were Present Directors or New Directors; or
(iv) any "person" or "group" within the meaning of Sections
13(d) and 14(d)(2) of the Exchange Act that is the
"beneficial owner" as defined in Rule 13d-3 under the
Exchange Act of 20% or more of the then outstanding voting
securities of the Corporation commences soliciting proxies.
2.2: "Code" means the Internal Revenue Code of 1986, as now or
hereafter amended.
2.3: "Employee" means all employees of the Corporation or of a
subsidiary or affiliate of the Corporation participating in the Plan, including
officers of the Corporation, as well as officers of the Corporation who are also
directors of the Corporation. However, an individual who is a member of the
Committee shall not be an "employee" for purposes of this Plan.
2.4: "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
2.5: "Exercise Payment" is a payment upon the exercise of a stock
option of an amount determined by the Committee in its discretion, which amount
shall not be greater than 60% of the excess of the Market Price over the option
price of the stock acquired upon the exercise of the option.
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2.6: "Incentive Stock Option" means any stock option granted pursuant
to this Plan which is designated as such by the Committee and which complies
with Section 422 of the Code.
2.7: "Market Price" is the mean of the high and low prices of the
common stock of the Corporation as reported in the New York Stock
Exchange-Composite Transactions on the date the option or stock appreciation
right is exercised (or on the next preceding day such stock was traded on a
stock exchange included in the New York Stock Exchange-Composite Transactions if
it was not traded on any such exchange on the date the option or stock
appreciation right is exercised), except that in the case of a stock
appreciation right that is exercised for cash during the first three days of the
ten-day period set forth in Section 7.5, "Market Price" is the highest daily
closing price of the common stock of the Corporation as reported in the New York
Stock Exchange-Composite Transactions during such ten-day period.
Notwithstanding the foregoing provisions, if a stock appreciation right is
exercised during the 60-day period commencing on the date of a Change in Control
of the Corporation, the Market Price for purposes of determining the stock
appreciation shall be the highest of (1) the market price of the common stock of
the Corporation, as determined under the preceding sentence; (2) the highest
market price of a share of the common stock of the Corporation during the period
commencing on the ninetieth day preceding the date of exercise of the stock
appreciation right and ending on the date of exercise of the stock appreciation
right; (3) the highest price per share of common stock of the Corporation shown
on Schedule 13D or an amendment thereto filed pursuant to Section 13(d) of the
Securities Exchange Act of 1934 by any person holding 20% of the combined voting
power of the Corporation's then outstanding voting securities; or (4) the
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highest price paid or to be paid per share of common stock of the Corporation
pursuant to a tender or exchange offer as determined by the Committee.
2.8: "Non-Qualified Stock Option" means any stock option granted
pursuant to this Plan which is not an Incentive Stock Option.
2.9: "Retirement" shall mean retirement from employment by the
Corporation or a subsidiary or affiliate with the right to receive immediately a
non-actuarially reduced pension under the Corporation's Retirement Program.
2.10: "Restricted Stock" means stock of the Corporation subject to
restrictions on the transfer of such stock, conditions of forfeitability of such
stock, or any other limitations or restrictions as determined by the Committee.
2.11: "Stock Appreciation" shall be based on the excess of the Market
Price of the common stock over the option price of the related option stock, as
determined by the Committee.
SECTION 3: PARTICIPATION. The Participants in the Plan ("Participants") shall be
those Employees serving in a managerial, administrative, or professional
position who are selected to participate in the Plan by the Committee of the
Board of Directors of the Corporation named to administer the Plan pursuant to
Section 4.
SECTION 4: ADMINISTRATION. The Plan shall be administered and interpreted by a
Committee of three or more members of the Board of Directors (hereinafter
referred to as the "Committee") appointed by the Board. Members of the Committee
are not eligible to participate in the Plan and no member may have been eligible
for selection as a person to whom stock may be allocated or to whom stock
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options or stock appreciation rights may be granted pursuant to the Plan or any
other plan of the Corporation or any of its affiliates within one year prior to
serving on the Committee. All decisions and acts of the Committee shall be final
and binding upon all Participants. The Committee shall: (i) determine the number
and types of awards to be made under the Plan; (ii) select the awards to be made
to Participants; (iii) set the option price, the number of options to be
awarded, and the number of shares to be awarded out of the total number of
shares available for award; (iv) delegate to the Chief Executive Officer of the
Corporation the right to allocate awards among Employees who are not officers or
directors of the Corporation within the meaning of the Exchange Act, such
delegation to be subject to such terms and conditions as the Committee in its
discretion shall determine; (v) establish administrative regulations to further
the purpose of the Plan; and (vi) take any other action desirable or necessary
to interpret, construe or implement properly the provisions of the Plan.
SECTION 5: AWARDS. Awards under this Plan may be in any of the following forms
(or a combination thereof): (i) stock option awards; (ii) stock appreciation
rights; (iii) exercise payment rights; (iv) grants of stock or Restricted Stock;
or (v) performance awards. Except as otherwise defined herein, "stock" shall
mean the common stock, $1.00 par value, of the Corporation. All awards shall be
made pursuant to award agreements between the Participant and the Corporation.
The agreements shall be in such form as the Committee approves from time to
time.
a. MAXIMUM AMOUNT AVAILABLE. The total number of shares of stock
(including Restricted Stock, if any) optioned or granted under this Plan during
the term of the Plan shall not exceed 7,500,000 shares. No Participant may be
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granted, in the aggregate, awards which would result in the Participant
receiving more than 10% of the maximum number of shares available for award
under the Plan. Solely for the purpose of computing the total number of shares
of stock optioned or granted under this Plan, there shall not be counted any
shares which have been forfeited and any shares covered by an option which,
prior to such computation, has terminated in accordance with its terms or has
been canceled by the Participant or the Corporation.
b. ADJUSTMENT IN THE EVENT OF RECAPITALIZATION, ETC. In the event of
any change in the outstanding shares of the Corporation by reason of any stock
split, stock dividend, recapitalization, merger, consolidation, combination or
exchange of shares or other similar corporate change or in the event of any
special distribution to the stockholders, the Committee shall make such
equitable adjustments in the number of shares and prices per share applicable to
options then outstanding and in the number of shares which are available
thereafter for Stock Option Awards or other awards, both under the Plan as a
whole and with respect to individuals, as the Committee determines are necessary
and appropriate. Any such adjustment shall be conclusive and binding for all
purposes of the Plan.
SECTION 6: STOCK OPTIONS.
6.1: The Corporation may award options to purchase common stock or
Restricted Stock of the Corporation (hereinafter referred to as "Stock Option
Awards") to such Participants as the Committee, or the Chief Executive Officer
of the Corporation, if the Committee in its discretion delegates the right to
allocate awards pursuant to Section 4, authorizes and under such terms as the
Committee establishes. The Committee shall determine with respect to each Stock
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Option Award and designate in the grant whether a Participant is to receive an
Incentive Stock Option or a Non-Qualified Stock Option.
6.2: The option price of each share of stock subject to a Stock Option
Award shall be specified in the grant, but in no event shall the exercise price
be less than the closing price of the common stock of the Corporation on the
date the award is authorized as reported in the New York Stock
Exchange-Composite Transactions. If the Participant to whom an Incentive Stock
Option is granted owns, at the time of the grant, more than ten percent (10%) of
the combined voting power of the Participant's employer or a parent or
subsidiary of the employer, the option price of each share of stock subject to
such grant shall be not less than one hundred ten percent (110%) of the closing
price described in the preceding sentence.
6.3: A stock option by its terms shall not be transferable by the
Participant other than by will or the laws of descent and distribution, and,
during the Participant's lifetime, will be exercisable only by the Participant.
A stock option by its terms also shall be of no more than 10 years' duration,
except that an Incentive Stock Option granted to a Participant who, at the time
of the grant, owns stock representing more than ten percent (10%) of the
combined voting power of the Participant's employer or a parent or subsidiary of
the employer shall be by its terms be of no more than five (5) years' duration.
A stock option by its terms shall be exercisable only after the earliest of: (i)
such period of time as the Committee shall determine and specify in the grant,
but in no event less than one year following the date of grant of such award;
(ii) the Participant's death; or (iii) a Change in Control of the Corporation.
An option is only exercisable by a Participant while the Participant
is in active employment with the Corporation, or its subsidiary, except (i) in
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the case of a Participant's death, Retirement or disability; (ii) during a
three-year period commencing on the date of a Participant's termination of
employment by the Corporation other than for cause; (iii) during a three-year
period commencing on the date of termination, by the Participant or the
Corporation, of employment after a Change in Control of the Corporation, unless
such termination of employment is for cause; or (iv) if the Committee decides
that it is in the best interest of the Corporation to permit individual
exceptions. An option may not be exercised pursuant to this paragraph after the
expiration date of the option.
6.4: An option may be exercised with respect to part or all of the
shares subject to the option by giving written notice to the Corporation of the
exercise of the option. The option price for the shares for which an option is
exercised shall be paid on or within ten business days after the date of
exercise in cash, in whole shares of common stock of the Corporation owned by
the Participant prior to exercising the option, or in a combination of cash and
such shares of common stock. The value of any share of common stock delivered in
payment of the option price shall be its Market Price on the date the option is
exercised.
6.5: The Committee may, in its discretion, grant to Participants
holding stock options the right to receive with respect to each share covered by
an option payments of amounts equal to the regular cash dividends paid to
holders of the Company's common stock during the period that the option is
outstanding (such payments are hereinafter referred to as "Dividend Payments").
6.6: The aggregate fair market value of all shares of stock with
respect to which Incentive Stock Options are exercisable for the first time by a
Participant in any one calendar year, under this Plan or any other stock option
plan maintained by the Corporation (or by any subsidiary or parent of the
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Corporation), shall not exceed $100,000. The fair market value of such shares of
stock shall be the mean of the high and low prices of the common stock of the
Corporation as reported in the New York Stock Exchange - Composite Transactions
on the date the related stock option is granted (or on the next preceding day
such stock was traded on a stock exchange included in the New York Stock
Exchange - Composite Transactions if it was not traded on any such exchange on
the date the related stock option is granted).
SECTION 7: STOCK APPRECIATION RIGHTS.
7.1: The Committee may, in its discretion, grant stock appreciation
rights to Participants who have received a Stock Option Award. The stock
appreciation rights may relate to such number of shares, not exceeding the
number of shares that the Participant may acquire upon exercise of a related
stock option, as the Committee determines in its discretion. Upon exercise of a
stock option by a Participant, the stock appreciation rights relating to the
shares covered by such exercise shall terminate. Upon termination or expiration
of a stock option, any unexercised stock appreciation rights related to that
option shall also terminate. Upon exercise of stock appreciation rights, such
rights and the related option to the extent of an equal number of shares shall
terminate.
7.2: The Committee at its discretion may revoke at any time any
unexercised stock appreciation rights granted to a Participant under this Plan,
without compensation to such Participant. Revocation of a Participant's stock
appreciation rights under this section shall not affect any related stock
options granted to the Participant under this Plan.
7.3: Upon a Participant's exercise of some or all of the Participant's
stock appreciation rights, the Participant shall receive an amount equal to the
value of the Stock Appreciation for the number of rights exercised, payable in
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cash, common stock, Restricted Stock, or a combination thereof, at the
discretion of the Committee.
7.4: The Committee shall have the discretion either to determine the
form in which payment of a stock appreciation right will be made, or to consent
to or disapprove the election of the Participant to receive cash in full or
partial settlement of the right. Such consent or disapproval may be given at any
time before or after the election to which it relates. Notwithstanding the
foregoing provision, if a Participant exercises a stock appreciation right
during the 60-day period commencing on the date of a Change in Control of the
Corporation, the form of payment of such stock appreciation right shall be cash,
provided that such stock appreciation right was granted as least six months
prior to the date of exercise, and shall be common stock if such stock
appreciation right was granted six months or less prior to the date of the
exercise.
7.5: Except in the case of a stock appreciation right that has granted
at least six months prior to exercise and is exercised for cash during the
60-day period commencing on the date of the Change in Control of the
Corporation, any election by the Participant to receive cash in full or partial
settlement of the stock appreciation right, as well as any exercise by the
Participant of the Participant's stock appreciation right for such cash, shall
be made only during the period beginning on the third business day following the
date of release of the quarterly or annual summary statements of sales and
earnings and ending on the twelfth business day following such date.
7.6: Settlement for exercised stock appreciation rights may be
deferred by the Committee in its discretion to such date and under such terms
and conditions as the Committee may determine.
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7.7: A stock appreciation right is only exercisable and transferable
during the period when the stock option to which it is related is also
exercisable and transferable, respectively. If the Participant is a person
subject to Section 16 of the Exchange Act, the election to exercise the stock
appreciation right may not be exercised within six months after the grant of the
option, unless otherwise permitted by law.
SECTION 8: EXERCISE PAYMENTS.
8.1: The Committee may, in its discretion, grant to Participants
holding stock options the right to receive Exercise Payments relating to such
number of shares covered by the Participant's stock options as the Committee
determines in its discretion. Exercise Payments shall be reduced by the total
amount which may have been received as Dividend Payments pursuant to Section 6.5
with respect to the stock option that is being exercised.
8.2: At the discretion of the Committee, the Exercise Payment may be
made in cash, common stock, Restricted Stock, or a combination thereof;
provided, however, Exercise Payments may be made in cash to Participants subject
to Section 16(b) of the Exchange Act only if they exercise the related stock
option during a period beginning on the third business day following the date of
release of the quarterly or annual summary statements of sales and earnings and
ending on the twelfth business day following such date. Exercise Payments shall
be paid within 20 business days following the exercise of a related stock
option; provided, however, that payment may be deferred by the Committee in its
discretion to such date and under such terms and conditions as the Committee may
determine.
8.3: Exercise Payments shall be paid only upon the exercise of related
stock options which are exercised by the Participant while an active Employee;
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provided, however, that in the case of a Participant's death, Exercise Payments
will be paid if the related stock options are exercised within nine months after
death, but before the expiration of the stock option's term.
In the case of a Participant's Retirement, any exercise payments
awarded to the Participant will be paid if the stock options are exercised
within the later of (i) three months after Retirement or (ii) three months after
such options became exercisable, but before the expiration of the term of the
stock option.
SECTION 9: GRANTS OF STOCK.
9.1: The Committee may grant, either alone or in addition to other
awards granted under the Plan, shares of stock or Restricted Stock to such
Participants as the Committee, or the Chief Executive Officer of the
Corporation, if the Committee in its discretion delegates the right to allocate
awards pursuant to Section 4, authorizes and under such terms as the Committee
establishes. The Committee, in its discretion, may also make a cash payment to a
Participant granted shares of stock or Restricted Stock under the Plan to allow
such Participant to satisfy tax obligations arising out of receipt of the stock
or Restricted Stock.
9.2: The Committee from time to time may authorize a Participant to
elect within 60 days of the receipt of the variable compensation payment paid by
the Corporation to the Participant to deposit with the Corporation shares of
common stock of the Corporation owned by the Participant with a value on the
date of deposit not exceeding twenty-five percent (25%) of the variable
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compensation payment, and receive a matching grant of an equal number of shares
of Restricted Stock subject to the following terms and conditions:
(i) A Participant may designate shares of common stock of the Corporation
(exclusive of ESOP Stock) held for the Participant's account in the
Savings Program for Employees of Union Carbide Corporation and
Participating Subsidiary Companies (the "Savings Plan") in lieu of
depositing shares of stock owned by the Participant.
(ii) The Restricted Stock shall be issued and registered in the name of
the Participant but shall be held in the custody of the Corporation
until the Restricted Stock becomes non-forfeitable;
(iii) The Restricted Stock shall not be transferable until the earlier
of (a) three years from the date of grant and (b) the date the
Restricted Stock becomes non-forfeitable;
(iv) The Restricted Stock shall be forfeited by the Participant if the
shares of common stock deposited with the Corporation (or designated
pursuant to (i) above) do not remain deposited with the Corporation or
so designated for three years from the date of grant; provided
however, that such stock may be withdrawn without any resulting
forfeiture upon the Participant's separation from service by reason of
death, disability, Retirement or termination by the Corporation
without cause if such separation from service occurs within the three
year period;
(v) The Restricted Stock shall be forfeited by the Participant if the
Participant separates from service with the Corporation during the
three year period from the date of grant. However, if a Participant
separates from service on account of death, disability, or termination
by the Corporation without cause, the Restricted Stock shall become
nonforfeitable at the time of such separation from service. If the
Participant separates from service on account of Retirement, the
Restricted Stock shall become nonforfeitable at the expiration of
three years from the date of grant, provided the Participant complies
with clause (iv) above.
(vi) Dividends paid on the stock held in the Participant's Savings Plan
accounts and utilized for the purpose of obtaining the Restricted
Stock grant under this Section 9.2 shall be paid according to the
terms of the Savings Plan;
(vii) Dividends paid on the stock deposited with the Corporation during
the three-year period from the date of grant shall be distributed to
the Participant, or, at the Participant's election, reinvested in the
Union Carbide Dividend Reinvestment and Stock Purchase Plan; and
(viii) Dividends paid on the Restricted Stock during the three year
period from the date of grant shall be held in the custody of the
Corporation and reinvested on the Participant's behalf in common stock
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of the Corporation at its market value at the time of purchase;
provided, however, that the stock so purchased shall be forfeited by
the Participant if the Restricted Stock to which the dividends relate
is forfeited.
This provision does not limit the Committee's authority under Section
9.1 to grant Restricted Stock to Participants under different terms than those
described in this Section 9.2.
SECTION 10: PERFORMANCE AWARDS.
10.1: The Committee may grant, either alone or in addition to other
awards granted under the Plan, awards of stock and other awards that are valued
in whole or in part by reference to, or are otherwise based on, the market value
of the common stock, Restricted Stock or other securities of the Corporation
("Performance Awards") to such Participants as the Committee, or the Chief
Executive Officer of the Corporation, if the Committee in its discretion
delegates the right to allocate awards pursuant to Section 4, authorizes and
under such terms as the Committee establishes. Performance Awards may be paid in
common stock, Restricted Stock or other securities of the Company, cash or any
other form of property as the Committee shall determine. Performance Awards
shall entitle the Participant to receive an award if the measures of performance
established by the Committee are met. The measures of performance shall be
established by the Committee in its absolute discretion.
10.2: The Committee shall determine the times at which Performance
Awards are to be made and all conditions of such awards.
10.3: The Participant shall not be permitted to sell, assign,
transfer, pledge or otherwise encumber shares received pursuant to this Section
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10 prior to the date on which any applicable restriction or performance period
established by the Committee lapses.
SECTION 11: GENERAL PROVISIONS.
11.1: Any assignment or transfer of any awards without the written
consent of the Corporation shall be null and void. 11.2: Nothing contained
herein shall require the Corporation to segregate any monies from its general
funds, or to create any trusts, or to make any special deposits for any
immediate or deferred amounts payable to any Participant for any year.
11.3: Participation in this Plan shall not affect the Corporation's
right to discharge a Participant.
11.4: Restricted Stock may not be sold or transferred by the
Participant until any restrictions that have been established by the Committee
have lapsed.
11.5: The Participant shall have, with respect to Restricted Stock,
all of the rights of a stockholder of the Corporation, including the right to
vote the shares and the right to receive any dividends, unless the Committee
shall otherwise determine.
11.6: Upon a Participant's termination of employment during the period
any restrictions are in effect, all Restricted Stock shall be forfeited without
compensation to the Participant unless the Committee decides that it is in the
best interest of the Corporation to permit individual exceptions.
SECTION 12: AMENDMENT, SUSPENSION, OR TERMINATION.
12.1: The Board of Directors may suspend, terminate, or amend the
Plan, including but not limited to such amendments as may be necessary or
desirable resulting from changes in the federal income tax laws and other
applicable laws, but may not, without approval by the holders of a majority of
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all outstanding shares entitled to vote on the subject at a meeting of
stockholders of the Corporation, increase the total number of shares of stock
that may be optioned or granted under this Plan.
12.2: This Plan is intended to comply with the requirements of Rule
16b-3 under the Exchange Act, as applicable during the term of the Plan. Should
the requirements of Rule 16b-3 change, the Board of Directors may amend this
Plan to comply with the requirements of that rule or its successor provision or
provisions.
SECTION 13: EFFECTIVE DATE AND DURATION OF THE PLAN.
This Plan shall be effective following approval by the stockholders of
the Corporation. No award shall be granted under this Plan subsequent to the
date of the meeting of shareholders of the Corporation in 1997.
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