Exhibit 10.15
CABOT OIL & GAS CORPORATION
SECOND AMENDED AND RESTATED 1994 LONG-TERM
INCENTIVE PLAN
1. Objectives. The Cabot Oil & Gas Corporation Second Amended and
Restated 1994 Long-Term Incentive Plan (the "Plan") is designed to attract and
retain key executives and other selected employees and reward them for making
major contributions to the success of Cabot Oil & Gas Corporation, a Delaware
corporation (the "Company"), and its Subsidiaries (as hereinafter defined).
These objectives are to be accomplished by making awards under the Plan and
thereby providing Participants (as hereinafter defined) with a proprietary
interest in the growth and performance of the Company and its Subsidiaries.
2. Definitions. As used herein, the terms set forth below shall have
the following respective meanings:
"Award" means the grant of any form of Stock Option, Stock
Appreciation Right, Stock Award, Performance Award or Cash Award, whether
granted singly, in combination or in tandem, to a Participant pursuant to any
applicable terms, conditions and limitations as the Committee may establish in
order to fulfill the objectives of the Plan.
"Award Agreement" means a written agreement between the Company and a
Participant that sets forth the terms, conditions and limitations applicable to
an Award.
"Board" means the Board of Directors of the Company.
"Cash Award" means an Award denominated in cash.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time.
"Committee" means such committee of the Board as is designated by the
Board to administer the Plan.
"Common Stock" means the Class A Common Stock, par value $.10 per
share, of the Company.
"Company" means Cabot Oil & Gas Corporation.
"Employee" means any person who is receiving remuneration for personal
services (or could be receiving remuneration except for an authorized leave of
absence) as an employee of the Company.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time.
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"Fair Market Value" means, as of a particular date, (i) if the shares
of Common Stock are listed on a national securities exchange, the average
between the highest and lowest sales price per share of Common Stock on the
consolidated transaction reporting system for the principal such national
securities exchange on that date, or, if there shall have been no such sale so
reported on that date, on the last preceding date on which such a sale was so
reported, or, at the discretion of the Committee, the price prevailing on the
exchange at the time of the relevant event on such date; (ii) if the shares of
Common Stock are not so listed but are quoted in the NASDAQ National Market
System, the average between the highest and lowest sales price per share of
Common Stock on the NASDAQ National Market System on that date, or, if there
shall have been no such sale so reported on that date, on the last preceding
date on which such a sale was so reported or, at the discretion of the
Committee, the price prevailing on the NASDAQ National Market at the time of the
relevant event on such date or (iii) if the Common Stock is not so listed or
quoted, the average between the closing bid and asked price on that date, or, if
there are no quotations available for such date, on the last preceding date on
which such quotations shall be available, as reported by NASDAQ, or, if not
reported by NASDAQ, by the National Quotation Bureau, Inc.
"Incentive Stock Option" or "ISO" means a Stock Option that complies
with Section 422 of the Code.
"Participant" means an employee of the Company or any of its
Subsidiaries to whom an Award has been made under this Plan.
"Performance Award" means an Award paid, vested or otherwise
deliverable on account of one or more pre-established objective Performance
Goals established by the Committee.
"Performance Goal" means a standard established by the Committee to
determine in whole or in part whether a Performance Award shall be earned.
"Restricted Stock" means Common Stock that is restricted or subject to
forfeiture provisions.
"Stock Award" means an Award consisting of Common Stock or denominated
in units of Common Stock.
"Stock Appreciation Right" or "SAR" means the right to receive a
payment, in cash or Common Stock, equal to the excess of the Fair Market Value
or other specified valuation of a number of shares of Common Stock on the date
the stock appreciation right is exercised over a specific strike price.
"Stock Based Awards Limitations" means the limitations applied to any
awards granted hereunder as described in Section 7(f)(i) and (ii) of the Plan.
"Stock Option" means a right to purchase a specified number of shares
of Common Stock at a specified price that is not less than the greater of (i)
the Fair Market Value of
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the Common Stock on the date of grant and (ii) the par value of the Common Stock
on the date of grant.
"Subsidiary" means any corporation of which the Company directly or
indirectly owns shares representing more than 50% of the voting power of all
classes or series of capital stock of such corporation which have the right to
vote generally on matters submitted to a vote of the stockholders of such
corporation.
3. Eligibility. Employees and individuals who have agreed to become
Employees of the Company and its Subsidiaries are eligible for an Award under
this Plan.
4. Common Stock Available for Awards. There shall be available for
Awards granted wholly or partly in Common Stock (including rights or options
which may be exercised for or settled in Common Stock) during the term of this
Plan an aggregate of 3,700,000 shares of Common Stock of which no more than 30%
of such shares will be used for Stock Awards. The Board and the appropriate
officers of the Company shall from time to time take whatever actions are
necessary to file required documents with governmental authorities and stock
exchanges and transaction reporting systems to make shares of Common Stock
available for issuance pursuant to Awards. Common Stock related to Awards that
are forfeited or terminated, expire unexercised, are settled in cash in lieu of
Stock or in a manner such that all or some of the shares covered by an Award are
not issued to a Participant, or are exchanged for Awards that do not involve
Common Stock, shall immediately become available for Awards hereunder. The
Committee may from time to time adopt and observe such procedures concerning the
counting of shares against the Plan maximum as it may deem appropriate.
5. Administration. This Plan shall be administered by the Committee,
which shall have full and exclusive power to interpret this Plan and to adopt
such rules, regulations and guidelines for carrying out this Plan as it may deem
necessary or proper, all of which powers shall be exercised in the best
interests of the Company and in keeping with the objectives of this Plan. The
Committee may, in its discretion, provide for the extension of the
exercisability of an Award, accelerate the vesting or exercisability of an
Award, eliminate or make less restrictive any restrictions contained in an
Award, waive any restriction or other provision of this Plan or an Award or
otherwise amend or modify an Award in any manner that is either (i) not adverse
to the Participant holding such Award or (ii) consented to by such Participant.
The Committee may correct any defect or supply any omission or reconcile any
inconsistency in this Plan or in any Award in the manner and to the extent the
Committee deems necessary or desirable to carry it into effect. Any decision of
the Committee in the interpretation and administration of this Plan shall lie
within its sole and absolute discretion and shall be final, conclusive and
binding on all parties concerned. No member of the Committee or officer of the
Company to whom it has delegated authority in accordance with the provisions of
Paragraph 6 of this Plan shall be liable for anything done or omitted to be done
by him or her, by any member of the Committee or by any officer of the Company
in connection with the performance of any duties under this Plan, except for his
or her own willful misconduct or as expressly provided by statute. The Committee
shall establish the vesting schedule, if any, for each Award. It is the intent
of this Plan that any Stock Option grants will never be repriced or reissued.
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6. Delegation of Authority. The Committee may delegate to the Chief
Executive Officer and to other senior officers of the Company its duties under
this Plan pursuant to such conditions or limitations as the Committee may
establish.
7. Awards. The Committee shall determine the type or types of Awards
to be made to each Participant under this Plan. Each Award made hereunder shall
be embodied in an Award Agreement, which shall contain such terms, conditions,
performance requirements and limitations as shall be determined by the Committee
in its sole discretion and shall be signed by the Participant and by the Chief
Executive Officer, the Chief Operating Officer, or any Vice President of the
Company for and on behalf of the Company. Awards may consist of those listed in
this Paragraph 7 and may be granted singly, in combination or in tandem.
(a) Stock Option. An Award may consist of a right to purchase a
specified number of shares of Common Stock at a specified price that is not less
than the greater of (i) the Fair Market Value of the Common Stock on the date of
grant and (ii) the par value of the Common Stock on the date of grant. A Stock
Option may be in the form of an Incentive Stock Option which, in addition to
being subject to applicable terms, conditions and limitations established by the
Committee, complies with Section 422 of the Code.
(b) Stock Appreciation Right. An Award may consist of a right to
receive a payment, in cash or Common Stock, equal to the excess of the Fair
Market Value or other specified valuation of a specified number of shares of
Common Stock on the date the Stock Appreciation Right is exercised over a
specified strike price as set forth in the applicable Award Agreement.
(c) Stock Award. An Award may consist of Common Stock or may be
denominated in units of Common Stock. All or part of any Stock Award may be
subject to conditions established by the Committee, and set forth in the Award
Agreement, which may include, but are not limited to, continuous service with
the Company and its Subsidiaries, achievement of specific business objectives,
increases in specified indices, attaining specified growth rates and other
comparable measurements of performance. Such Awards may be based on Fair Market
Value or other specified valuations. The certificates evidencing shares of
Common Stock issued in connection with a Stock Award shall contain appropriate
legends and restrictions describing the terms and conditions of the restrictions
applicable thereto.
(d) Cash Award. An Award may be denominated in cash with the amount
of the eventual payment subject to future service and such other restrictions
and conditions as may be established by the Committee, and set forth in the
Award Agreement, including, but not limited to, continuous service with the
Company and its Subsidiaries, achievement of specific business objectives,
increases in specified indices, attaining specified growth rates and other
comparable measurements of performance.
(e) Performance Award. Without limiting the type or number of Awards
that may be made under the other provisions of this Plan, an Award may be in the
form of a Performance Award. A Performance Award shall be paid, vested or
otherwise deliverable solely
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on account of the attainment of one or more pre-established, objective
Performance Goals established by the Committee prior to the earlier to occur of
(i) 90 days after the commencement of the period of service to which the
Performance Goal relates and (ii) the lapse of 25% of the period of service (as
scheduled in good faith at the time the goal is established), and in any event
while the outcome is substantially uncertain. A Performance Goal is objective if
a third party having knowledge of the relevant facts could determine whether the
goal is met. Such a Performance Goal may be based on one or more business
criteria that apply to the Employee, one or more business units of the Company,
or the Company as a whole, and may include one or more of the following:
increased revenue, net income, stock price, market share, earnings per share,
return on equity, return on assets, decrease in costs, shareholder value, net
cash flow, total shareholder return, return on capital, return on investors'
capital, operating income, funds from operations, cash flow, cash from
operations, after-tax operating income, reserve addition, proceeds from
dispositions, production volumes, refinery runs, net cash flow before financing
activities, reserve replacement ratio, finding and development costs, refinery
utilizations and total market value. Unless otherwise stated, such a Performance
Goal need not be based upon an increase or positive result under a particular
business criterion and could include, for example, maintaining the status quo or
limiting economic losses (measured, in each case, by reference to specific
business criteria). In interpreting Plan provisions applicable to Performance
Goals and Performance Awards, it is the intent of the Plan to conform with the
standards of Section 162(m) of the Code and Treasury Regulation (S) 1.162-
27(e)(2)(i), and the Committee in establishing such goals and interpreting the
Plan shall be guided by such provisions. Prior to the payment of any
compensation based on the achievement of Performance Goals, the Committee must
certify in writing that applicable Performance Goals and any of the material
terms thereof were, in fact, satisfied. Subject to the foregoing provisions, the
terms, conditions and limitations applicable to any Performance Awards made
pursuant to this Plan shall be determined by the Committee.
(f) Notwithstanding anything to the contrary contained in this Plan,
the following limitations shall apply to any Awards made hereunder:
(i) no Participant may be granted, during any calendar year, Awards
consisting of Stock Options or Stock Appreciation Rights that are
exercisable for more than 500,000 shares of Common Stock;
(ii) no Participant may be granted, during any calendar year, Stock
Awards covering or relating to more than 100,000 shares of Common Stock;
and
(iii) no Participant may be granted Awards consisting of cash or in
any other form permitted under this Plan (other than Awards consisting of
Stock Options or Stock Appreciation Rights or Stock Awards) in respect of
any calendar year having a value determined on the date of grant in excess
of $1,000,000.
8. Payment of Awards.
(a) General. Payment of Awards may be made in the form of cash or
Common Stock or combinations thereof and may include such restrictions as the
Committee
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shall determine, including in the case of Common Stock, restrictions on transfer
and forfeiture provisions. As used herein, "Restricted Stock" means Common Stock
that is restricted or subject to forfeiture provisions.
(b) Deferral. With the approval of the Committee, payments may be
deferred, either in the form of installments or a future lump sum payment. The
Committee may permit selected Participants to elect to defer payments of some or
all types of Awards in accordance with procedures established by the Committee.
Any deferred payment, whether elected by the Participant or specified by the
Award Agreement or by the Committee, may be forfeited if and to the extent that
the Award Agreement so provides.
(c) Dividends and Interest. Dividends or dividend equivalent rights
may be extended to and made part of any Award denominated in Common Stock or
units of Common Stock, subject to such terms, conditions and restrictions as the
Committee may establish. The Committee may also establish rules and procedures
for the crediting of interest on deferred cash payments and dividend equivalents
for deferred payment denominated in Common Stock or units of Common Stock.
9. Stock Option Exercise. The price at which shares of Common Stock
may be purchased under a Stock Option shall be paid in full at the time of
exercise in cash or, if permitted by the Committee, by means of tendering Common
Stock or surrendering another Award, including Restricted Stock, valued at Fair
Market Value on the date of exercise, or any combination thereof. The Committee
shall determine acceptable methods for tendering Common Stock or other Awards to
exercise a Stock Option as it deems appropriate. If permitted by the Committee,
payment may be made by successive exercises by the Participant. The Committee
may provide for loans from the Company to permit the exercise or purchase of
Awards and may provide for procedures to permit the exercise or purchase of
Awards by use of the proceeds to be received from the sale of Common Stock
issuable pursuant to an Award. Unless otherwise provided in the applicable Award
Agreement, in the event shares of Restricted Stock are tendered as consideration
for the exercise of a Stock Option, a number of the shares issued upon the
exercise of the Stock Option, equal to the number of shares of Restricted Stock
used as consideration therefor, shall be subject to the same restrictions as the
Restricted Stock so submitted as well as any additional restrictions that may be
imposed by the Committee.
10. Tax Withholding. The Company shall have the right to deduct
applicable taxes from any Award payment and withhold, at the time of delivery or
vesting of cash or shares of Common Stock under this Plan, an appropriate amount
of cash or number of shares of Common Stock or a combination thereof for payment
of taxes required by law or to take such other action as may be necessary in the
opinion of the Company to satisfy all obligations for withholding of such taxes.
The Committee may also permit withholding to be satisfied by the transfer to the
Company of shares of Common Stock theretofore owned by the holder of the Award
with respect to which withholding is required. If shares of Common Stock are
used to satisfy tax withholding, such shares shall be valued based on the Fair
Market Value when the tax withholding is required to be made.
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11. Amendment, Modification, Suspension or Termination. The Board may
amend, modify, suspend or terminate this Plan for the purpose of meeting or
addressing any changes in legal requirements or for any other purpose permitted
by law except that (i) no amendment or alteration that would impair the rights
of any Participant under any Award previously granted to such Participant shall
be made without such Participant's consent and (ii) no amendment or alteration
shall be effective prior to approval by the Company's stockholders to the extent
such approval is then required by applicable legal requirements.
12. Termination of Employment. Upon the termination of employment by
a Participant, any unexercised, deferred or unpaid Awards shall be treated as
provided in the specific Award Agreement evidencing the Award. In the event of
such a termination, the Committee may, in its discretion, provide for the
extension of the exercisability of an Award, accelerate the vesting or
exercisability of an Award, eliminate or make less restrictive any restrictions
contained in an Award, waive any restriction or other provision of this Plan or
an Award or otherwise amend or modify the Award in any manner that is either (i)
not adverse to such Participant or (ii) consented to by such Participant.
13. Assignability. Unless otherwise determined by the Committee and
provided in the Award Agreement, no Award or any other benefit under this Plan
constituting a derivative security within the meaning of Rule 16a-1(c) under the
Exchange Act shall be assignable or otherwise transferable except by will or the
laws of descent and distribution or pursuant to a qualified domestic relations
order as defined by the Code or Title I of the Employee Retirement Income
Security Act, or the rules thereunder. The Committee may prescribe and include
in applicable Award Agreements other restrictions on transfer. Any attempted
assignment of an Award or any other benefit under this Plan in violation of this
Paragraph 13 shall be null and void.
14. Adjustments.
(a) The existence of outstanding Awards shall not affect in any
manner the right or power of the Company or its stockholders to make or
authorize any or all adjustments, recapitalizations, reorganizations or other
changes in the capital stock of the Company or its business or any merger or
consolidation of the Company, or any issue of bonds, debentures, preferred or
prior preference stock (whether or not such issue is prior to, on a parity with
or junior to the Common Stock) or the dissolution or liquidation of the Company,
or any sale or transfer of all or any part of its assets or business, or any
other corporate act or proceeding of any kind, whether or not of a character
similar to that of the acts or proceedings enumerated above.
(b) In the event of any subdivision or consolidation of outstanding
shares of Common Stock or declaration of a dividend payable in shares of Common
Stock or capital reorganization or reclassification or other transaction
involving an increase or reduction in the number of outstanding shares of Common
Stock, the Committee may adjust proportionally (i) the number of shares of
Common Stock reserved under this Plan and covered by outstanding Awards
denominated in Common Stock or units of Common Stock; (ii) the exercise or other
price in respect of such Awards; (iii) the appropriate Fair Market Value and
other price
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determinations for such Awards; and (iv) the Stock Based Awards Limitations, as
provided in Section 7(f)(ii) to reflect such transaction. In the event of any
consolidation or merger of the Company with another corporation or entity or the
adoption by the Company of a plan of exchange affecting the Common Stock or any
distribution to holders of Common Stock of securities or property (other than
normal cash dividends or dividends payable in Common Stock), the Committee shall
make such adjustments or other provisions as it may deem equitable, including
adjustments to avoid fractional shares, to give proper effect to such event. In
the event of a corporate merger, consolidation, acquisition of property or
stock, separation, reorganization or liquidation, the Committee shall be
authorized to issue or assume stock options, regardless of whether in a
transaction to which Section 424(a) of the Code applies, by means of
substitution of new options for previously issued options or an assumption of
previously issued options, or to make provision for the acceleration of the
exercisability of, or lapse of restrictions with respect to, Awards and the
termination of unexercised options in connection with such transaction.
15. Restrictions. No Common Stock or other form of payment shall be
issued with respect to any Award unless the Company shall be satisfied based on
the advice of its counsel that such issuance will be in compliance with
applicable federal and state securities laws. Certificates evidencing shares of
Common Stock delivered under this Plan may be subject to such stop transfer
orders and other restrictions as the Committee may deem advisable under the
rules, regulations and other requirements of the Securities and Exchange
Commission, any securities exchange or transaction reporting system upon which
the Common Stock is then listed and any applicable federal and state securities
law. The Committee may cause a legend or legends to be placed upon any such
certificates to make appropriate reference to such restrictions.
16. Unfunded Plan. Insofar as it provides for Awards of cash, Common
Stock or rights thereto, this Plan shall be unfunded. Although bookkeeping
accounts may be established with respect to Participants who are entitled to
cash, Common Stock or rights thereto under this Plan, any such accounts shall be
used merely as a bookkeeping convenience. The Company shall not be required to
segregate any assets that may at any time be represented by cash, Common Stock
or rights thereto, nor shall this Plan be construed as providing for such
segregation, nor shall the Company nor the Board nor the Committee be deemed to
be a trustee of any cash, Common Stock or rights thereto to be granted under
this Plan. Any liability or obligation of the Company to any Participant with
respect to a grant of cash, Common Stock or rights thereto under this Plan shall
be based solely upon any contractual obligations that may be created by this
Plan and any Award Agreement, and no such liability or obligation of the Company
shall be deemed to be secured by any pledge or other encumbrance on any property
of the Company. Neither the Company nor the Board nor the Committee shall be
required to give any security or bond for the performance of any obligation that
may be created by this Plan.
17. Governing Law. This Plan and all determinations made and actions
taken pursuant hereto, to the extent not otherwise governed by mandatory
provisions of the Code or the securities laws of the United States, shall be
governed by and construed in accordance with the laws of the State of Delaware.
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18. Effective Date of Plan. This amended and restated Plan shall be
effective as of the date (the "Effective Date") it is approved by the Board of
Directors of the Company. Notwithstanding the foregoing, the adoption of this
Plan is expressly conditioned upon the approval by the holders of a majority of
shares of Common Stock present, or represented, and entitled to vote at a
meeting of the Company's stockholders held on or before ___________, 2001. If
the stockholders of the Company should fail so to approve the provisions of this
Plan, the Plan shall revert to the provisions as in effect under the Amended and
Restated 1994 Long-Term Incentive Plan of Cabot Oil & Gas Corporation.
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