FERRELL COMPANIES, INC.
1998 INCENTIVE COMPENSATION PLAN
1. PURPOSE. The purposes of the Ferrell Companies, Inc. 1998 Incentiv
Compensation Plan (the "Plan") are as follows:
(a) to allow upper middle and senior level managers of
Ferrellgas, Inc. ("FGI") to participate in
the equity growth of Ferrell Companies, Inc. ("FCI") and,
indirectly (through its "subsidiary"
holding), in the equity growth of Ferrellgas Partners, L.P.
(the "Partnership") and its subsidiaries (with FCI, FGI, the
Partnership and its subsidiaries being collectively referred
to herein as "Companies");
(b) to generate an increased incentive to contribute to the
Partnership's future success and
prosperity and to focus on the value growth of FCI; and
(c) to focus on profitable Partnership growth and acquisition
activities that will enable subordinated Partnership units
("Subordinated Units") held by FCI to convert to common
Partnership units ("Common Units"), to increase the value of
all Partnership Units (including both Common and Subordinated
Units) and to increase the equity value of FCI, through an
increasing Partnership value, a maximization of Partnership
distributions, a reduction of FCI debt, and an optimization
of share value growth for the FCI shares held by FCI's
employee stock ownership plan (its "ESOP").
Unless defined in the sentence or paragraph in which they are used, definitions
used herein are set forth in Section 9.9 below.
2. ADMINISTRATION.
2.1 Administration by Committee. The Plan shall be administered
by the FCI Options Committee (comprised of three members of
the FCI's or FGI's Management Committee, and generally
including the CEO and CFO of FGI, as well as the senior
personnel manager of FGI) (the "Committee").
2.2 Authority. Subject to the provisions of the Plan, the
Committee shall have the authority to (a) interpret the
provisions of the Plan, and prescribe, amend, and rescind
rules and procedures relating to the Plan, (b) grant
incentives under the Plan, in such forms and amounts and
subject to such terms and conditions as it deems appropriate,
including, without limitation, incentives which are made in
combination with or in tandem with other incentives (whether
or not contemporaneously granted) or compensation or in lieu
of current or deferred compensation, (c) modify the terms of,
cancel and reissue, or repurchase outstanding incentives,
subject to Section 9.7, (d) suspend the operation of the Plan
(or any portion thereof) pursuant to the provisions of
Section 9.8 hereinbelow and (e) make all other determinations
and take all other actions as it deems necessary or desirable
for the administration of the Plan. The determination of the
Committee on matters within its authority shall be conclusive
and binding on Companies and all other persons. The Committee
shall comply with all applicable law in administering the
Plan.
3. Participation. Subject to the terms and conditions of the Plan, the
Committee shall designate from time to time employees of Companies
(including, without limitation, employees who are officers and/or
directors of any Companies entity) who shall receive incentives under
the Plan ("Participants").
4. SHARES SUBJECT TO THE PLAN
4.1 Number of Shares Reserved. Subject to adjustment in
accordance with Sections 4.2 and 4.3, the aggregate number of
shares of FCI common stock ("Common Stock") available for
incentives under the Plan shall be that number of shares of
Common Stock equaling 20% of FCI's outstanding Common Stock
shares, on a fully-diluted basis, immediately following the
date on which the ESOP has acquired all of the outstanding
Common Stock shares.
All shares of Common Stock issued under the Plan may be
authorized and unissued shares or treasury shares. In
addition, all of such shares may, but need not, be issued
pursuant to the exercise of nonqualified stock options.
4.2 Reusage of Shares.
(a) In the event of the termination (by reason of
forfeiture, expiration, cancellation, surrender, or
otherwise) of any incentive under the Plan, that
number of shares of Common Stock that was subject to
the incentive but not delivered shall be available
again for incentives under the Plan.
(b) In the event that shares of Common Stock are
delivered under the Plan and are thereafter forfeited
or reacquired by FCI (whether or not pursuant to
rights reserved upon the award thereof), such
forfeited or reacquired shares shall be available
again for incentives under the Plan.
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4.3 Adjustments to Shares Reserved. In the event of any merger,
consolidation, reorganization, recapitalization, spinoff,
stock dividend, stock split, reverse stock split, exchange,
or other distribution with respect to shares of Common Stock
or other change in the corporate structure or capitalization
affecting the Common Stock (each being an "Adjustment"), the
type and number of shares of stock which are or may be
subject to incentives under the Plan and the terms of any
outstanding incentives (including the price at which shares
of stock may be issued pursuant to an outstanding incentive)
shall be equitably adjusted by the Committee, in its sole
discretion, to preserve both the value of incentives awarded
or to be awarded to Participants under the Plan and the
percentage of outstanding Common Stock shares (on a
fully-diluted basis) available for incentives under the Plan
immediately prior to the date of the Adjustment (taking into
account both incentives granted but not yet distributed from
the Plan and incentives not yet granted under the Plan).
5. STOCK OPTIONS.
5.1 Awards. Subject to the terms and conditions of the Plan, the
Committee shall designate the individuals to whom
"nonqualified stock options" to purchase shares of Common
Stock ("Stock Options") are to be awarded under the Plan and
shall determine the number, and terms of the Stock Options to
be awarded to each of them. Unless and until the Committee
makes a decision to the contrary, the Participants to whom
Stock Options are granted hereunder shall be designated from
the following two employee groups:
(i) field employees who are at or above the "area
manager" designation level; and
(ii) corporate (Liberty or Houston) employees who are
deemed by the Committee to have a material positive
impact on developing and implementing the strategies,
systems or processes that support the operations of
the Partnership and contribute to the achievement by
the Partnership of its financial and operational
goals and the maximization of the equity value of
FCI.
Stock Options awarded under the Plan will, unless and until
the Committee makes a decision to the contrary, be classified
as either "Tranche A Options" or "Tranche B Options." Each
Stock Option awarded under the Plan shall be a "nonqualified
stock option" for tax purposes.
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5.2 Adjustment of Awards. If a Participant experiences a material
change in job status (or other similar compensation
measurement as may, from time to time, be utilized by the
Committee), the Committee may, in its sole discretion,
determine whether any or all of the unvested portion of the
Participant's Stock Option(s) shall be taken from the
Participant and returned to FCI. In addition, in the event of
a Change in Control, the Committee may, in its sole
discretion, determine what adjustments, if any, should be
made to (i) Stock Options awarded hereunder and/or (ii) the
Plan.
5.3 Time For Exercise. Each Stock Option shall be exercisable
only if it is vested (as described in Section 5.4 below) and,
then, only to the extent, at the times and until the
expiration date(s) described in the following table:
------------------------ -------------------------------------- ------------------------------------
Exercise Event Percentage of Vested Portion of Percentage of Vested Portion of
Tranche A Options Which May be Tranche B Options Which May be
Exercised on Specified Exercise Dates Exercised on Specified Exercise
Dates
------------------------ -------------------------------------- ------------------------------------
Full repayment of the Up to 25% of the vested portion of a Up to 25% of the vested portion of
"FCI Senior Notes" (as Participant's Stock Option(s) may be a Participant's Stock Option(s)
defined in Section 9.9 exercised, upon (and only upon) the may be exercised, upon (and only
below) ("Trigger 1") first odd-numbered year "Exercise upon) the first even-numbered year
Date" (as defined in Section 9.9 "Exercise Date" next following
below) next following such repayment such repayment of the FCI Senior
of the FCI Senior Notes. Notes.
------------------------ -------------------------------------- ------------------------------------
Full repayment of the An additional 25% of the vested An additional 25% of the vested
"Subordinated Notes" portion of a Participant's Stock portion of a Participant's Stock
(as defined in Section Option(s) may be exercised, upon Option(s) may be exercised, upon
9.9 below), and (and only upon) the first (and only upon) the first
assuming Trigger 1 odd-numbered year Exercise Date next even-numbered year Exercise Date
occurs ("Trigger 2") following such repayment of the next following such repayment of
Subordinated Notes. the Subordinated Notes.
------------------------ -------------------------------------- ------------------------------------
Assuming that both The vested portion of a The vested portion of a
Trigger 1 and Trigger Participant's Stock Option(s) may be Participant's Stock Option(s) may
2 have occurred: exercised up to the following be exercised up to the following
percentages on the Exercise Date percentages on the Exercise Date
occurring in each of the following occurring in each of the following
years: years:
2009 60% 2010 70%
2011 80% 2012 90%
2013 100% 2014 100%
2015 100% 2016 100%
2017 100% 2018 100%
------------------------ -------------------------------------- ------------------------------------
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In the event that either or both of Trigger 1 and Trigger 2
has (have) not occurred by 2013 (for Tranche A Options) or
2014 (for Tranche B Options), then (i) 100% of the vested
portion of a Participant's Tranche A Option(s) may be
exercised on the Exercise Date occurring in each of 2013,
2015 and 2017; and (ii) to up to 100% of the vested portion
of a Participant's vested Tranche B Option(s) may be
exercised on the Exercise Date occurring in each of 2014,
2016 and 2018.
5.4 Vesting. Subject to the next succeeding sentence, vesting of
Tranche A Options and Tranche B Options shall occur as
follows:
Anniversary of Annual Cumulative
Stock Option Vested Vested
Grant Date Percentage Percentage
1st 5% 5%
2nd 5% 10%
3rd 5% 15%
4th 5% 20%
5th 5% 25%
6th 10% 35%
7th 10% 45%
8th 10% 55%
9th 10% 65%
10th 10% 75%
11th 10% 85%
12th 15% 100%
Notwithstanding the immediately preceding vesting schedule,
however, all Stock Options granted hereunder shall fully vest
upon (a) a "Change in Control" of the Partnership or FCI, (b)
the Participant's death, or "permanent disability" or (c) the
Participant's retirement from FCI at or after attainment of
age 65. A Stock Option, whether or not vested, will be
forfeited, no longer exercisable and, if vested, divested and
if (i) a Participant's employment with FGI is terminated for
gross insubordination (as determined by FGI's Board of
Directors) or (ii) the Participant enters a plea of "guilty"
or "nolo contendre" to, or is convicted by a court of
competent jurisdiction of, a felony.
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5.5 Option Price. The option price per share ("Option Price") for
any Stock Option awarded shall not be less than the "Fair
Market Value" of a share of Common Stock on the date the
Stock Option is granted. Recipients of Stock Options shall be
timely notified no less frequently than twice annually of the
Fair Market Value of a share of Common Stock.
5.6 Manner of Exercise. The vested portion of a Stock Option may
be exercised, in whole or in part, once a year on the
Exercise Date by notice to FCI specifying the number of whole
(not fractional) shares of Common Stock to be purchased. Such
notice shall be given at least thirty (30) days prior to the
Exercise Date and it shall be accompanied by (or provision
shall be made for) (i) payment of the Option Price by a
certified or cashiers check or wire transfer payable to the
order of the Company on or prior to the Exercise Date; (ii)
an executed share transfer restriction agreement (the form of
which shall either be attached to the agreement memorializing
the Participant's Stock Option grant or be provided to the
Participant prior to the first Exercise Date for the Stock
Option); and (iii) such other documents or representations
(including, without limitation, representations as to the
intention of the Participant or his/her successor to acquire
the shares for investment) as the Company may reasonably
request in order to comply with securities, tax or other laws
then applicable to the exercise of the Stock Option.
Unless the Committee sets a shorter exercise period in its
grant of Stock Options hereunder, the vested portion of the
Stock Option so granted may be exercised until (and must be
exercised on or before) January 31, 2018. Subject to the next
succeeding sentence, if the Participant becomes no longer
employed by a Companies entity prior to the exercise of all
of the vested portion of the Participant's Stock Option(s)
(and the Participant is not immediately thereafter employed
with another Companies entity), the nonvested portion of the
Participant's Stock Option(s) shall expire, terminate and be
forfeited, and the Participant will be permitted to exercise
the vested portion of his/her Stock Option(s) during the
times set for exercise as described in the table set forth in
Section 5.3 above. In such case, the Committee may, in its
sole discretion, give the terminated participant one
opportunity to exercise all of the vested portion of his/her
Stock Option(s) (with the opportunity specifying the early
Exercise Date on which such vested portion must be
exercised). If the Participant is given such an opportunity
and chooses not to exercise all of the remaining vested
portion of his/her remaining Stock Option(s) by the early
Exercise Date, such vested portion of the Stock Option(s)
will immediately expire, terminate and be forfeited as of
such date.
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5.7 ESOP Call. All shares acquired by a Participant pursuant to
the exercise of a Stock Option shall be subject to a "call
option" which shall be granted to and may be (a) exercised by
the Ferrell Companies, Inc. Employee Stock Ownership Trust
(the "Trust") and (b) assigned by the trustee of the Trust
(the "Trustee") to FCI. Although the call option may
generally be exercised by either (i) the Trust or (ii) by the
Trust's assignee, if applicable, it may not be exercised
during the first six months following the Exercise Date.
The shares acquired by a Participant pursuant to such
exercise may be called by the Trust (or its assignee) at
their Fair Market Value as of the date of the call (the "Call
Date") by giving the Participant who acquired the shares
notice of the Trust's (or its assignee's) intention to call
the shares (a "call notice") at least ten (10) business days
prior to the Call Date. As stated in Section 5.5 above,
Participants receiving grants of Stock Options shall be
notified every six (6) months of the Fair Market Value of a
share of Common Stock.
A Participant receiving a call notice shall deliver to the
Trustee (or the Trust's assignee, as applicable) stock
certificate(s) for the called shares prior to the Call Date.
The Participant's sale of the called shares shall be deemed
to have occurred as of the Call Date, with the purchase price
being payable in one lump sum by the Trust (or its assignee)
within ninety (90) days of any Call Date not occurring on
July 31st or January 31st and within ninety (90) days after
the receipt of the ESOP financial advisor's determination of
the Fair Market Value of the called shares as of any July
31st or January 31st Call Date. Notwithstanding the
immediately preceding sentence, however, if a Participant's
employment is terminated prior to the Participant's exercise
of all of the vested portion of his/her Stock Option and the
Committee gives the Participant one opportunity to exercise
such vested portion as of an early Exercise Date, the
purchase price to be paid by the Trust (or its assignee) for
any early Exercise Date shares acquired pursuant to its call
option will be payable in the form of a five-year promissory
note given by the Trust (or its assignee) (with (i) interest
payable at the lowest percentage of libor which equals or
exceeds the "Applicable Federal Rate" and (ii) semi-annual
equal payments of principal and interest being made during
the five-year payment period).
5.8 Put Option. All shares acquired by a Participant pursuant to
the exercise of a Stock Option shall be subject to a "put
option" (the "Put Option") which shall be granted as of the
acquisition date to and may be exercised by the Participant
or other party receiving such shares (as provided hereunder,
the "Other Party") if, at the time of their receipt, the
shares are not readily tradable on an established market, as
defined in Section 409(h) of the Internal Revenue Code of
1986, as amended (the "Code") and the Treasury regulations
promulgated thereunder. The Put Option shall permit the
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Participant or Other Party to sell some or all of the shares
acquired at their Fair Market Value as of (and only as of)
any July 31st or January 31st following the Exercise Date
(each being a "Permissible Put Date"). The Put Option may
not, however, be exercised during the first six months
following the Exercise Date and it may no longer ever be
exercised once a call notice (as described in Section 5.7
above) has been sent or delivered by the Company.
Shares acquired pursuant to the exercise of a Participant's
Stock Option may be put by the Participant or Other Party at
their Fair Market Value as of a Permissible Put Date by
giving the Company notice of the Participant's (or Other
Party's) intention to put the shares (a "put notice") at
least ten (10) business days prior to the Permissible Put
Date. As is stated in Section 5.5 above, Participants
receiving grants of Stock Options shall be notified every six
(6) months of the Fair Market Value of a share of a share of
Common Stock.
In the event the Company receives a put notice, the sale
pursuant to the put shall be deemed to have occurred as of
the Permissible Put Date referenced in the Put Notice, with
the purchase price being payable by the Company (or its
assignee) in one lump sum within ninety (90) days after the
receipt of the ESOP financial advisor's determination of the
Fair Market Value of the put shares as of the specified
Permissible Put Date. Notwithstanding the immediately
preceding sentence, however, if a Participant's employment is
terminated prior to the Participant's exercise of all of the
vested portion of his/her Stock Option and the Committee
gives the Participant one opportunity to exercise such vested
portion as of an early Exercise Date, the purchase price to
be paid by the Company (or its assignee) for any early
Exercise Date shares acquired pursuant to the Put Option will
be payable in the form of a five-year promissory note given
by the Company (or its assignee) (with (i) interest payable
at the lowest percentage of libor which equals or exceeds the
"Applicable Federal Rate" and (ii) semi-annual equal payments
of principal and interest being made during the five-year
payment period).
5.9 Share Restrictions. The exercise of a Participant's Stock
Option shall be conditioned upon the Participant's execution
of a share transfer restriction agreement (which shall either
be attached to the agreement memorializing the Participant's
Stock Option grant or provided to the Participant prior to
the first Exercise Date for the Stock Option so granted).
Unless and until the Committee makes a decision to the
contrary, all shares purchased pursuant to the exercise of
Stock Options granted hereunder (i) must be held for at
least, and shall be non-transferable during, the six-month
period immediately following the Exercise Date; (ii) will be
subject to the call option described in Section 5.7 above;
and (iii) will be subject to the Put Option described in
Section 5.8 above.
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6. STOCK APPRECIATION RIGHTS.
6.1 Grant of SARs. Subject to the terms and conditions of the
Plan, the Committee shall designate the employees to whom
stock appreciation rights ("SARs") are to be awarded under
the Plan and shall determine the number, type and terms of
the SARs to be awarded to each of them. An SAR may be granted
in tandem with a Stock Option granted under the Plan, or the
SAR may be granted on a free-standing basis. Tandem SARs may
be granted either at or after the time of grant of a Stock
Option, provided that, in the case of an ISO a tandem SAR may
be granted only at the time of the grant of such Stock
Option. The grant price of a tandem SAR shall equal the
option price of the related Stock Option and the grant price
of a free-standing SAR shall be equal to the Fair Market
Value of a share of Common Stock on the SAR's grant date.
6.2 Exercise of Tandem SARs. Tandem SARs may be exercised for all
or part of the shares subject to the related option upon the
surrender of the right to exercise the equivalent portion of
the related Stock Option. A tandem SAR shall terminate and no
longer be exercisable upon termination or exercise of the
related Stock Option. A tandem SAR may be exercised only with
respect to the shares for which its related option is then
exercisable.
6.3 Exercise of Free-Standing SARs. Free-standing SARs may be
exercised upon such terms and conditions as the Committee,
in its sole discretion, determines.
6.4 Term of SARs. The term of an SAR granted under the Plan shall
be determined by the Committee in its sole discretion;
provided, however, that such term shall not exceed the option
term in the case of a tandem SAR, or ten years in the case of
a free-standing SAR.
6.5 Payment of SAR Amount. Upon exercise of an SAR, a Participant
shall be entitled to receive payment from Companies in an
amount determined by multiplying:
(a) The excess of the Fair Market Value of a share of
Common Stock on the date of exercise
over the "grant price" of the SAR; by
(b) The number of shares with respect to which the SAR is
exercised.
At the discretion of the Committee, the payment to be made
upon an SAR exercise may be in cash, in shares of Common
Stock of equivalent value, or in some combination thereof.
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7. PERFORMANCE SHARES.
7.1 Awards. Subject to the terms and conditions of the Plan, the
Committee shall designate the employees to whom Performance
Shares are to be awarded and determine the number of shares
and the terms and conditions of each such award. Subject to
the terms of Section 7.3 below and the immediately preceding
sentence, each Performance Share shall entitle the
Participant to a payment in the form of one share of Common
Stock as soon as reasonably practicable following the date on
which the specified performance goals and other terms and
conditions specified by the Committee are attained (the
"Attainment Date").
7.2 No Adjustments. Except as otherwise provided by the Committee
or in section 4.3 hereof, no adjustment shall be made in
Performance Shares awarded on account of cash dividends which
may be paid or other rights which may be provided to the
holders of Common Stock prior to the end of any performance
period.
7.3 Substitution of Cash. The Committee may, in its sole
discretion, substitute cash equal to the Fair Market Value of
shares of Common Stock otherwise required to be issued to a
Participant hereunder (with such Fair Market Value being the
Fair Market Value most recently determined by the ESOP
financial advisor immediately prior to the Attainment Date).
8. OTHER INCENTIVES. In addition to the incentives described in Sections 5
through 7 above and subject to the terms and conditions of the Plan,
the Committee may grant other incentives ("Other Incentives"), payable
in cash or in stock, under the Plan as it determines to be in the best
interest of Companies.
9. GENERAL
9.1 Effective Date. The Plan was adopted by the Board of
Directors effective as of July 17, 1998.
9.2 Duration. The Plan shall remain in effect until all
incentives granted under the Plan have been satisfied by the
issuance of shares of Common Stock, lapse of restrictions or
the payment of cash, or have been terminated in accordance
with the terms of the Plan or the incentive.
9.3 Non-transferability of Incentives. No incentive granted under
the Plan may be transferred, pledged, or assigned by the
employee except by will or the laws of descent and
distribution in the event of death, and FCI shall not be
required to recognize any attempted assignment of such rights
by any Participant. During a Participant's lifetime, awards
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may be exercised only by the Participant or by the
Participant's guardian or legal representative.
Notwithstanding the foregoing, at the discretion of the
Committee, a grant of an award may (but need not) permit the
transfer of the award by the Participant solely to members of
the Participant's immediate family or trusts or family
partnerships for the benefit of such persons, subject to such
terms and conditions as may be established by the Committee.
9.4 Compliance with Applicable Law and Withholding.
(a) The award of any benefit under the Plan may also be
made subject to such other provisions as the
Committee determines appropriate, including, without
limitation, provisions to comply with federal and
state securities laws or stock exchange requirements.
(b) If, at any time, FCI, in its sole discretion,
determines that the listing,
registration, qualification of any type of incentive,
or the shares of Common Stock issuable pursuant
thereto, or availability of exemption is necessary on
any securities exchange or under any federal or state
securities or blue sky law, or that the consent
or approval of any governmental regulatory body is
necessary or desirable, the exercise or issuance of
shares of Common Stock pursuant to any incentive, or
the removal of any restrictions imposed on shares
subject to an incentive, may be delayed
until such listing, registration, qualification,
exemption, consent, or approval is
effected.
(c) The Companies' entities shall have the right to
withhold from any award under the Plan or to collect
as a condition of any payment under the Plan, as
applicable, any taxes required by law to be withheld.
To the extent permitted by the Committee, to fulfill
any tax withholding obligation, a Participant may
elect to have any distribution otherwise required to
be made under the Plan (or a portion thereof) to be
withheld or, where Stock Options are to be exercised,
the Participant may use shares received from the
exercise of the Stock Option.
9.5 No Continued Employment. Participation in the Plan will not
affect any right any entity of Companies has to terminate the
employment of a Participant or give any Participant the right
to be retained in the employ of Companies or any right or
claim to any benefit under the Plan unless such right or
claim has specifically accrued under the terms of any
incentive under the Plan.
9.6 Treatment as a Stockholder. No incentive granted to a
Participant under the Plan shall create any rights in such
Participant as a stockholder of FCI until shares of Common
Stock related to the incentive are registered in the name of
the Participant.
9.7 Amendment or Discontinuation of the Plan. The Board of
Directors may amend, suspend, or discontinue the Plan at any
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time; provided, however, that (a) the Committee may amend or
suspend the Plan to avoid the occurrence of any of the
events/circumstances described in Clauses (i) thru (iii) in
Section 9.8 below; and (b), other than such an amendment or
suspension by the Committee, no amendment, suspension or
discontinuance shall adversely affect any outstanding benefit
and if any law, agreement or exchange on which Common Stock
is traded requires stockholder approval for an amendment to
become effective, no such amendment shall become effective
unless approved by vote of FCI's stockholders.
9.8 Limitations on Applicability. No Plan provision shall be
applicable if its application would (i) cause a default under
the terms of an extension of credit made to any Companies'
entity, or (ii) have an effect on the ability of the
Partnership to make any "Restricted Payment," or (iii) cause
a material change in FCI's Federal, state or local corporate
or tax status. In addition to the powers reserved to the
Committee in Section 2.2 above, the Committee shall have
complete discretion to administer the Plan in such a way as
will prevent the occurrence of any such default, inability to
make a Restricted Payment or change in corporate tax status.
9.9 Definitions.
(a) Change in Control. The term "Change in Control"
shall be defined as
(1) any merger or consolidation of FCI in which
such entity is not the survivor,
(2) any sale of all or substantially all of the
Common Stock of FCI by the Trust,
(3) a sale of all or substantially all of the
Common Stock of FGI,
(4) a replacement of FGI as the General Partner of
the Partnership, or
(5) a public sale of a "material" amount of FCI's
equity (with materiality being determined by
the Committee, but with a material amount of
such equity being at least 51% thereof).
(b) Exercise Date. The term "Exercise Date" refers to the
31st day of January (i.e., January 31st) of each year
in which a Stock Option may be exercised (with each
such year being an odd-numbered year for Tranche A
Options and an even-numbered year for Tranche B
Options).
(c) Fair Market Value. Except as otherwise determined by
the Committee, the "Fair Market Value" of a share of
Common Stock as of any date shall equal the value of
such a share most recently determined for the ESOP by
its independent financial advisor to the ESOP
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(assuming no material change in such value since the
date as of which such determination was made);
provided, however, that the "Fair Market Value" of a
share of Common Stock as of any July 31st or January
31st shall equal the value of such a share, as of
such date, as determined by such independent
financial advisor .
(d) FCI Senior Notes. The term "FCI Senior Notes" means
the Series A Notes, the Series B Notes and the Series
C Loans issued pursuant to the Master Agreement dated
July 15, 1998 among FCI, the initial purchasers of
the Series A Notes, the initial purchasers of the
Series B Notes, the Series C Lenders referred therein
and U.S. Bank National Association, as collateral
agent (the "Master Agreement").
(e) Master Agreement. The term "Master Agreement" shall
have the meaning set forth in Section 9.9(d) above.
(f) Permanent Disability. The term "permanent disability"
means any mental or physical condition which entitles
the referenced Participant to disability benefits
under the long-term disability plans of the
Participant's employer.
(g) Restricted Payment. The term "Restricted Payment"
of the Partnership or its subsidiaries means, as
applicable, a "Restricted Payment" as defined in the
debt documents of either the Partnership or its
subsidiaries.
(h) Subordinated Notes. The term "Subordinated Notes"
means any promissory note(s)
constituting "Subordinated Debt" (as said term is
defined in the Master Agreement).
(i) Subsidiary. The term "subsidiary" means any
business, whether or not incorporated, in
which FCI has a direct or indirect ownership interest.
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