Exhibit 10(iii)(g)
1995 MOBIL INCENTIVE COMPENSATION AND STOCK OWNERSHIP PLAN
ARTICLE I--PURPOSE OF THE PLAN
The purpose of the Mobil Incentive Compensation and Stock Ownership Plan is
to promote the creation of shareholder value by encouraging, recognizing and
rewarding sustained outstanding corporate, division, business unit and
individual performance by key Employees of Mobil Corporation and Affiliated
Corporations who are largely responsible for the management, growth and
protection of the business. The Plan in addition provides part of a competitive
total compensation package to attract and retain key Employees.
The components of the Plan include the Short-Term Incentive Program, the
Long-Term Incentive Program and the Stock Ownership Program. The purpose of the
Short-Term Incentive Program is to base a portion of key Employees' total annual
compensation on the performance of the Corporation compared to the performance
of other companies selected by the Committee, with the intention that the key
Employees will receive total compensation that is above the average for
comparable positions paid by such other companies when the Corporation's
comparative performance is above average; total compensation that is equal to
the average for comparable positions paid by these companies when the
Corporation's comparative performance is average; and total compensation that is
below the average for comparable positions when the Corporation's comparative
performance is below average. The Long-Term Incentive Program provides rewards,
based on the performance of the Corporation over a longer term, to those key
Employees who have the potential to contribute significantly to the long-term
growth and success of the Corporation. These awards are denominated in
hypothetical stock or in the form of Restricted Stock, which serves to align the
interests of these key Employees with the interests of shareholders. The purpose
of the Stock Ownership Program is to provide long-term incentive, designed to
encourage Stock ownership by key Employees, thereby directly aligning their
financial interests with those of shareholders. Key Employees receive Stock
Options, which provide them an opportunity to increase their ownership of Stock,
and the Committee is expected to develop guidelines to encourage key Employees
to take advantage of the program to acquire and hold Stock.
ARTICLE II--DEFINITIONS
"Adjusted Net Income" with respect to any fiscal year of the Corporation
means the amount reported as net income in the Income Statement for such year,
adjusted to exclude any of the following items:
(a) extraordinary items (as described in Accounting Principles Board
Opinion No. 30);
(b) gains or losses on the disposition of discontinued operations of a
segment of the business; and
(c) the cumulative effect of changes in accounting principles.
"Affiliated Corporation" means any stock corporation of which a majority of
the voting common or capital stock is owned directly or indirectly by the
Corporation.
"Allotment" means a number of Stock Equivalents granted pursuant to Section
5.3(a).
"Allotment Supplement" means a number of Stock Equivalents credited with
respect to an Allotment pursuant to Section 5.3(b).
"Authorized Share Pool" for any calendar year during any part of which this
Plan is in effect means nine tenths of one percent (0.9%) of the total issued
and outstanding shares of Stock as of December 31 of the preceding year,
cumulative from the effective date of the Plan, subject to adjustment pursuant
to Article IX.
"Award" means a Short-Term Incentive Award or a Long-Term Incentive Award
granted under Article V or an Option granted under Article VI. Awards granted
that are to be paid upon full satisfaction of any applicable conditions are
provisional Awards and are forfeitable until such conditions are satisfied. An
Award is non-forfeitable if the only condition to its payment is passage of
time.
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"Award Date" means the date an Award is granted.
"Board" means the Board of Directors of the Corporation.
"Chief Executive Officer" means the Employee of the Corporation acting in
such capacity.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time. Reference to a specific provision of the Code shall include such provision
and any regulation or ruling promulgated thereunder.
"Committee" means the Management Compensation and Organization Committee of
the Board or such other committee as may be designated by the Board to
administer the Plan.
"Corporation" means Mobil Corporation, a Delaware corporation, or its
successor.
"Dividend Equivalent" means, in respect of one Stock Equivalent, an amount
equal to the amount of the dividend that would be payable on any Dividend
Payment Date with respect to one share of Stock.
"Dividend Payment Date" means a date on which dividends are paid with
respect to Stock.
"Employee" means any person who is a regular full time employee of the
Corporation or an Affiliated Corporation, including such employees who are
officers or directors of the Corporation. In the discretion of the Committee,
the term may include persons who at the request of the Corporation or any
Affiliated Corporation accept employment with any company in which the
Corporation directly or indirectly has a substantial interest.
"Fair Market Value" of Stock is the mean between the highest and lowest
quoted selling price of Stock on the New York Stock Exchange or, in the
discretion of the Committee, as reported by a recognized central market
reporting system on the date an Award is granted or on any other date the value
of Stock is to be determined, provided that (i) if no sales of Stock shall have
been so made on such Exchange or so reported by such central market reporting
system on such date, or (ii) if in the opinion of the Committee insufficient
sales shall have been made on such date to constitute a representative market,
then Fair Market Value shall be determined by taking a weighted average of the
means between the highest and lowest sales prices on the nearest representative
trading dates before and after the valuation date. The average is to be weighted
inversely by the respective numbers of trading days between the trading dates
and the valuation date.
"Incentive Award" means a Short-Term Incentive Award or a Long-Term
Incentive Award.
"Income Statement" with respect to any fiscal year of the Corporation means
the consolidated statement of income and the accompanying notes to financial
statements for such year included in the Corporation's annual report to
shareholders.
"Long-Term Incentive Award" means an Award granted pursuant to Section 5.3.
"Named Executive Officer" means an Employee described in Section 162(m)(3)
of the Code for the year an Incentive Award is granted.
"Non-Qualified Option" means an Option granted under Article VI which is
not a Qualified Option.
"Option" means an Award granted under Article VI in the form of a right to
purchase Stock evidenced by an instrument containing such provisions as the
Committee may establish.
"Performance Cycle" means any period, beginning not earlier than January 1,
1995, of four successive calendar years.
"Performance Measure" means such measure or indicator of the performance of
the Corporation, an Affiliated Corporation, any division, department or
identifiable segment thereof, or of any individual recipient of an Award as may
be set forth herein or established from time to time by the Committee.
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"Plan" means this 1995 Mobil Incentive Compensation and Stock Ownership
Plan.
"Prior Plan" means the 1991 Mobil Incentive Compensation and Stock Option
Plan.
"Qualified Option" means an option granted under Article VI which is
designated by the Committee as a Qualified Option and for which the Code
provides for either or both deferral of taxation on exercise or a lower
effective rate of tax on recognition of gain than would be available in respect
of a Non-Qualified Option.
"Restricted Stock" means Stock which bears such restrictive endorsements as
the Committee, in its discretion, shall deem appropriate and necessary to carry
out the purpose of this Plan.
"Short-Term Incentive Award" means an Award granted pursuant to Section
5.2.
"Special Item" with respect to any fiscal year of the Corporation means
each item in excess of $10 million after tax that is reflected in the
Corporation's Adjusted Net Income for such year and is recorded in accordance
with generally accepted accounting principles in one of the following
categories:
(a) Gains or losses on asset sales or dispositions;
(b) Asset write downs;
(c) Litigation or claim judgments or settlements;
(d) Accruals for environmental obligations;
(e) Effect of changes in tax law or rate on deferred tax liabilities;
(f) Accruals for restructuring programs; and
(g) Catastrophic property losses.
"Stock" means the publicly traded common stock of the Corporation or any
successor, including any adjustments in the event of changes in capital
structure of the type described in Article IX.
"Stock Equivalent" means a hypothetical share of Stock credited to an
Employee having a value at any time equal to the Fair Market Value of an actual
share of Stock at that time. Stock Equivalents may be recorded in full shares
only or in full and fractional shares pursuant to such rules as the Committee
shall prescribe.
ARTICLE III--ADMINISTRATION OF THE PLAN
3.1 COMPOSITION OF COMMITTEE
This Plan shall be administered by the Committee which shall be composed of
not less than four members of the Board as may be designated by the Board;
provided that the Committee shall not include any individual who (a) is an
officer or employee of the Corporation or any Affiliated Corporation; (b) is a
former officer of the Corporation or any Affiliated Corporation; (c) is a former
employee of the Corporation or any Affiliated Corporation who receives
compensation for prior service (other than benefits under a tax-qualified
retirement plan) during the taxable year in which such individual serves on the
Committee; (d) is not an outside director as defined under Section 162(m) of the
Code; or (e) has been eligible to receive Awards under this Plan or the Prior
Plan at any time within the 12-month period immediately prior to service as a
member of the Committee; provided that the restrictions set out in clause (d)
shall not apply prior to the annual meeting of shareholders of the Corporation
in 1996 (or such later date as may be permitted under Section 162(m) of the
Code). The Board may designate alternate members of the Committee from eligible
Board members to act in the place and stead of any absent member of the
Committee.
3.2 QUORUM
A majority of the Committee shall constitute a quorum, and the acts of a
majority of the members present at any meeting at which a quorum is present, or
acts approved in writing by all of the members in the absence of a meeting,
shall be the acts of the Committee. Any one or more members of the Committee may
participate in a meeting by means of a conference telephone or similar
communications equipment by means of which all
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persons participating in the meeting can hear and speak to each other.
Participation by such means shall constitute presence in person at such
meeting.
3.3 POWERS
The Committee shall have full and final authority to operate, manage and
administer the Plan on behalf of the Corporation. This authority includes, but
is not limited to:
(a) The power to grant Awards conditionally or unconditionally,
subject to any applicable limitations in this Plan,
(b) The power to establish Performance Measures upon which Awards
shall be based; provided that any changes to the Performance Measures
applicable to Named Executive Officers set forth in Article V shall be
subject to approval by a separate vote of the shareholders of the
Corporation,
(c) The power to make the certification referred to in Section 3.4(b),
(d) The power to reduce the amount of any Award (other than an Award
that has become non-forfeitable),
(e) The power to determine whether Incentive Awards shall be expressed
in United States currency, shares of Stock, Restricted Stock, or any
combination thereof,
(f) The power to prescribe the form or forms of the instruments
evidencing Awards granted under this Plan,
(g) The power to pay and to defer payment of Incentive Awards which
have become non-forfeitable,
(h) The power to direct the Corporation to make the conversions,
accruals and payments provided for by the Plan,
(i) The power to interpret the Plan and to make any determination of
fact incident to the operation of the Plan,
(j) The power to provide regulations for the operation of the various
features of the Plan, and otherwise to prescribe regulations for the
interpretation, management and administration of the Plan,
(k) The power to delegate responsibility for Plan operation,
management and administration on such terms, consistent with the Plan, as
the Committee may establish,
(l) The power to delegate to other persons the responsibility of
performing ministerial acts in furtherance of the Plan's purpose, and
(m) The power to engage the services of persons, companies, or
organizations, including but not limited to banks, insurance companies,
brokerage firms, and consultants, in furtherance of the Plan's purpose.
3.4 CERTIFICATION
No Short-Term Incentive Award or Long-Term Incentive Award will be paid to
a Named Executive Officer unless the Committee has certified in writing (which
writing may include approved minutes of a meeting of the Committee) that the
Adjusted Net Income and Special Items, or the average of the Adjusted Net Income
amounts for the years included in a Performance Cycle, as the case may be, was
equal to or in excess of the amount required for the granting of such Award
hereunder.
3.5 COMMUNICATION OF AWARDS
The Committee shall timely communicate in writing to each Employee to whom
an Award is granted in accordance with this Plan a description of such Award,
including the terms and any conditions of its payment.
3.6 ACCOUNTS
(a) For the purpose of accounting for provisional Awards and
non-forfeitable Awards deferred as to payment, the Corporation shall establish
bookkeeping accounts bearing the name of each Employee receiving such Awards.
Except as provided below, each account shall be unfunded, and shall not be a
trust for the benefit of the Employee; the existence of such accounts shall not
give any Employee any rights superior to those of unsecured general creditors of
the Corporation.
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(b) With respect to non-forfeitable Awards, payment of which is deferred,
the Committee may, in its discretion, direct the Corporation:
(i) To pay an amount equal to such Award to a trustee or fiduciary in
trust for the benefit of one or more Employees, as the Committee may
designate, with instructions to provide for the investment thereof during
any period of deferment; or
(ii) To allocate an amount equal to such Award to an investment manager
(who may, but need not, be an Employee of the Corporation or an Affiliated
Corporation) with instructions to provide for the investment thereof during
the period of deferment either in the discretion of such manager or one or
more designated investment advisors.
ARTICLE IV--ELIGIBILITY
4.1 ELIGIBLE EMPLOYEES
Awards will be granted only to key Employees described in Article I,
selected or determined by (or pursuant to delegation of authority from) the
Committee in its sole discretion. An Incentive Award may be granted within a
reasonable period after an employee's termination of service and such Incentive
Award shall be deemed granted to an Employee. Neither the members of the
Committee nor any member of the Board who is not an Employee shall be eligible
to receive an Award. In lieu of determining individual Employees to whom Awards
may be granted and the amounts of such Awards, the Committee may in its
discretion from time to time authorize such determinations with respect to
Employees other than Named Executive Officers to be made by the Chief Executive
Officer or by senior management of the divisions, departments or other
identifiable segments of the Corporation or of Affiliated Corporations or their
divisions, departments or other identifiable segments, provided that such
determinations shall be made in accordance with such rules, regulations and
guidance as the Committee shall prescribe. Named Executive Officers, other
Officers of the Corporation, Directors who are Employees and other Employees to
whom the Committee delegates final authority to determine Awards under the Plan
are eligible only for Awards granted directly by the Committee.
4.2 RELEVANT FACTORS
In selecting individual Employees to whom Awards shall be granted at any
time, as well as in determining the amount, type, terms and conditions of any
Award, the Committee (or as authorized, its representative) shall weigh such
factors as are relevant to accomplish the purpose of the Plan as stated in
Article I. No Employee shall be eligible for the grant of any Option under the
Plan if at the time of grant the Employee, directly or indirectly, owns Stock
possessing more than 5% of the combined voting power of all classes of Stock of
the Corporation and its Affiliated Corporations. No Named Executive Officer
shall be eligible for the grant of any Award that would cause the applicable
amounts in Articles V or VI to be exceeded.
ARTICLE V--INCENTIVE AWARDS
5.1 PROVISIONAL AND NON-FORFEITABLE INCENTIVE AWARDS
The Committee may in its discretion grant Incentive Awards that are provisional
or non-forfeitable in accordance with such criteria, at such intervals, in such
form and upon such conditions as the Committee may establish, subject to the
limitations set forth in this Plan. Incentive Awards, whether provisional or
non-forfeitable, may be expressed in United States currency, shares of Stock,
shares of Restricted Stock or any combination thereof, and upon satisfaction of
the relevant conditions, if any, may be paid or distributed currently, deferred
for payment at a later date, or paid in part currently and in part at a later
date, all as the Committee in its discretion shall determine.
5.2 SHORT-TERM INCENTIVE AWARDS
The Committee in its sole discretion may grant or approve Short-Term
Incentive Awards to Employees from time to time. The amounts of such Awards
shall be determined on the basis of such Performance Measures as the Committee
shall establish from time to time. In the case of Named Executive Officers, the
Performance Measure for Short-Term Incentive Awards shall be the Adjusted Net
Income for the year prior to the year in which any such Award is granted,
further adjusted to exclude the effects of any Special Items for such year.
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The amount of the Short-Term Incentive Award for any year to a Named Executive
Officer who is the Chief Executive Officer shall be 0.1% of such Performance
Measure, and the amount of the Short-Term Incentive Award for any year to any
other Named Executive Officer shall be 0.0375% of such Performance Measure, in
each case subject to reduction pursuant to Section 5.4.
5.3 LONG-TERM INCENTIVE AWARDS
(a) The Committee in its sole discretion may grant Allotments comprised of
a specified number of Stock Equivalents to Employees from time to time. Each
Allotment shall be granted during the first year of, and shall be in respect of,
a Performance Cycle and shall remain provisional until the Committee grants or
determines not to grant a Long-Term Incentive Award in respect of such Allotment
pursuant to Section 5.3(c). The maximum number of Stock Equivalents that may
comprise Allotments granted at any time during any calendar year during any part
of which this Plan is in effect shall be the number of shares of Stock in the
Authorized Share Pool for such calendar year reduced by:
(i) the number of shares of Stock upon which Options have theretofore
been granted pursuant to Section 6.2 during such calendar year;
(ii) the number of Stock Equivalents comprising Allotments that have
theretofore been granted pursuant to this Section 5.3(a) during such
calendar year;
(iii) the number of Stock Equivalents comprising Allotment Supplements
that have theretofore been credited pursuant to Section 5.3(b) during such
calendar year or are reasonably estimated to be so credited during the
remainder of such calendar year; and
(iv) the number of shares of Restricted Stock, if any, that have
theretofore been awarded pursuant to Section 5.3(d) during such calendar
year.
(b) On each Dividend Payment Date after the Award Date of any Allotment, an
Allotment Supplement shall be credited in respect of such Allotment and any
Allotment Supplements theretofore credited pursuant to this Section 5.3(b) in
respect of such Allotment. The number of Stock Equivalents that shall comprise
an Allotment Supplement shall be determined by dividing (i) the Dividend
Equivalents in respect of the number of Stock Equivalents that comprise such
Allotment and any Allotment Supplements theretofore credited pursuant to this
Section 5.3(b) in respect of such Allotment by (ii) the Fair Market Value of a
share of Stock on the Dividend Payment Date.
(c) After the end of each Performance Cycle, all Stock Equivalents that
comprise an Allotment in respect of such Performance Cycle and all Allotment
Supplements theretofore credited in respect of such Allotment shall be converted
to a Long-Term Incentive Award in an amount, if any, to be based on Performance
Measures established by the Committee from time to time. In the case of each
Named Executive Officer, the Performance Measure shall be Adjusted Net Income,
and the amount of the Long-Term Incentive Award granted to each such Officer in
respect of a Performance Cycle, irrespective of the number of Stock Equivalents
credited to the account of such Officer in respect of such Performance Cycle,
shall be 0.2% of the average of the Adjusted Net Income for each of the four
years of such Performance Cycle, subject to reduction pursuant to Section 5.4.
(d) In addition to the Long-Term Incentive Awards described in Sections
5.3(a), (b) and (c), the Committee in its sole discretion may grant Long-Term
Incentive Awards in the form of Restricted Stock to such Employees as it shall
identify as having extraordinary potential to make a long-term contribution to
the success of the Corporation. The maximum number of shares of Restricted Stock
that can be the subject of any such grant shall be 10,000, subject to adjustment
in accordance with Article IX. No Award may be made pursuant to this Section
5.3(d) to any person who at the time of the Award holds Restricted Stock granted
pursuant to this Section 5.3(d) as to which all restrictions applicable to such
Restricted Stock have not lapsed. The foregoing determination as to whether
restrictions have lapsed shall be made without regard to any potential or actual
modification of such restrictions after the original grant date. The maximum
number of shares of Restricted Stock that may be granted at any time during any
calendar year during any part of which this Plan is in effect shall be the
number of shares in the Authorized Share Pool for such calendar year reduced by:
(i) the number of shares of Stock upon which Options have theretofore
been granted pursuant to Section 6.2 during such calendar year;
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(ii) the number of Stock Equivalents comprising Allotments that have
theretofore been granted pursuant to Section 5.3(a) during such calendar
year;
(iii) the number of Stock Equivalents comprising Allotment Supplements
that have theretofore been credited pursuant to Section 5.3(b) during such
calendar year or are reasonably expected to be so credited during the
remainder of such calendar year; and
(iv) the number of shares of Restricted Stock that have theretofore been
awarded pursuant to this Section 5.3(d) during such calendar year.
5.4 REDUCTION OF AWARDS
(a) The Committee in its sole discretion may, but shall not be required to,
reduce the amount of, or not grant, any Short-Term Incentive Award or any Long-
Term Incentive Award that could otherwise be granted, based on such Performance
Measures or other considerations as it deems appropriate.
(b) No Short-Term Incentive Award or Long-Term Incentive Award that could
otherwise be granted shall be granted if no dividend has been paid to holders of
Stock in the preceding 12 months. Allotments or Allotment Supplements with
respect to which Long-Term Incentive Awards are prohibited by the preceding
sentence shall be cancelled.
5.5 DEATH OF EMPLOYEE
Any provisional Incentive Award shall be cancelled upon death of the
Employee during the provisional period except as the Committee may otherwise
provide. If a provisional Incentive Award is cancelled by reason of the death of
the Employee, the Committee may authorize an alternative disposition in its
discretion.
5.6 DEFERRAL OF INCENTIVE AWARDS
The Committee may, in its sole discretion, permit or require deferral of
payment of any Incentive Award, subject to such terms, conditions, rules and
regulations as the Committee shall prescribe. Deferred Incentive Awards may be
denominated in Stock Equivalents or such other units as the Committee shall
prescribe. Where a deferred Incentive Award is denominated in Stock Equivalents,
each such Stock Equivalent shall be valued at an amount equal to the Fair Market
Value of a share of Stock on the date that payment would have been due but for
the deferral (or the Fair Market Value of a share of Stock averaged over such
dates as the Committee shall establish from time to time). An account bearing
the name of the Employee as provided in Section 3.6 shall be credited with the
number of Stock Equivalents determined on the basis of such value. Each such
account shall also be credited on each Dividend Payment Date with an amount of
Dividend Equivalents in respect of the Stock Equivalents in the account.
Dividend Equivalents may, in the discretion of the Committee, be disbursed in
cash to the Employee to whose account they have been credited or accumulated in
such account in the form of additional Stock Equivalents based on the Fair
Market Value of a share of Stock on the Dividend Payment Date. Stock Equivalents
resulting from deferral of Incentive Awards shall not be charged against any
Authorized Share Pool.
5.7 PAYMENT OF INCENTIVE AWARDS
Payment of Incentive Awards shall be made, in the sole discretion of the
Committee, in cash, Stock, Restricted Stock, or any combination of cash, Stock
and Restricted Stock; provided that the Committee may prescribe by regulation
circumstances in which amounts payable to any person who is or was a director or
officer subject to Section 16 of the Securities Exchange Act of 1934 shall be
paid solely in cash.
ARTICLE VI--STOCK OPTION AWARDS
6.1 NUMBER OF SHARES
The maximum number of shares of Stock upon which Options may be granted at
any time during any calendar year during any part of which this Plan is in
effect shall be the number of shares in the Authorized Share Pool for such
calendar year reduced by:
(a) the number of shares of Stock upon which Options have theretofore been
granted pursuant to Section 6.2 during such calendar year;
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(b) the number of Stock Equivalents comprising Allotments that have
theretofore been granted pursuant to Section 5.3(a) during such calendar
year;
(c) the number of Stock Equivalents comprising Allotment Supplements
that have theretofore been credited pursuant to Section 5.3(b) during such
calendar year or are reasonably estimated to be so credited during the
remainder of such calendar year; and
(d) the number of shares of Restricted Stock that have theretofore been
awarded pursuant to Section 5.3.(d) during such calendar year.
Of the shares of Stock upon which Options may be granted in any year
pursuant to the foregoing sentence, no more than 2,000,000 shares (subject to
adjustment pursuant to Article IX) per year, cumulative from the effective date
of the Plan, shall be available for the grant of Incentive Stock Options.
6.2 OPTION GRANTS
The Committee in its sole discretion may from time to time grant Options on
such terms and subject to such conditions as it shall deem appropriate, subject
to the applicable provisions of this Plan; provided that the maximum number of
shares of Stock upon which Options may be granted to any Employee in any
calendar year shall be 150,000, subject to adjustment as provided in Article IX.
As to each Option, the Committee shall have full and final authority in its
discretion: (a) to determine whether the same shall be a Qualified Option or a
Non-Qualified Option or both, (b) to determine the number of shares of Stock
subject to each Option, subject to the limit set forth in the immediately
preceding sentence, (c) to determine the purchase price of the shares of Stock
subject to each Option (the "Option Price"), which price shall be not less than
the minimum price specified in Section 6.4, and (d) to determine the time or
times when each Option shall become exercisable and the duration of the exercise
period, which period shall not exceed the maximum period specified in Section
6.3.
6.3 TERM OF OPTIONS
The full term of each Option granted hereunder shall be for such period as
the Committee shall determine, but not for more than ten years from the date of
granting thereof. Each Option shall be subject to earlier termination as
provided in Sections 6.8 and 6.9.
6.4 OPTION PRICE
The Option Price shall be determined by the Committee at the time any
Option is granted and shall be not less than 100 percent of the Fair Market
Value of the shares covered thereby at the time the Option is granted (but in no
event less than par value).
6.5 NON-TRANSFERABILITY OF OPTIONS
No Option granted under this Plan shall be transferable by the grantee
otherwise than by will or the laws of descent and distribution, and such Option
may be exercised during the grantee's lifetime only by the grantee; provided
that the Committee may in its sole discretion provide in the instrument
evidencing any Non-Qualified Option any terms and conditions upon which such
Non-Qualified Option may be transferred if the Committee determines, based upon
such advice of counsel (which may be counsel to the Corporation) as it deems
appropriate, that a Registration Statement under the Securities Act of 1933 is
in effect, or an exemption from the requirements for such a Registration
Statement exists, for each of (a) the transfer of such Non-Qualified Option; (b)
the issuance of Stock to the transferee of the Non-Qualified Option upon
exercise of the Non-Qualified Option; and (c) any sale by the transferee of the
Option of Stock issued to such transferee upon exercise of the Non-Qualified
Option.
6.6 INCENTIVE STOCK OPTIONS
Any Option issued hereunder which is intended to qualify as an "incentive
stock option" as described in Section 422 of the Code (an "ISO") shall be
subject to the limitations or requirements as may be necessary for the purposes
of Section 422 of the Code to the extent and in such form as determined by the
Committee in its discretion.
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6.7 EXERCISE OF OPTIONS
Each Option granted under this Plan shall be exercisable on such date or
dates and during such period and for such number of shares as shall be
determined pursuant to the provisions of the instrument evidencing such Option.
A person electing to exercise an Option shall give written notice to the
Corporation or its agent of such election and of the number of shares he or she
has elected to purchase and shall at the time of exercise tender the full
purchase price of the shares he or she has elected to purchase plus any required
withholding taxes. Until a certificate or certificates for the shares so
purchased has been issued to, or for the benefit of, such person, or until an
entry in lieu of such a certificate is made on the stock books of the
Corporation, he or she shall possess no rights of a record holder with respect
to any of such shares. The purchase price may be paid in cash, by certified
check or in shares of Stock (excluding fractional shares) or any combination
thereof. Shares of Stock delivered in payment of the purchase price shall be
valued at the Fair Market Value of such shares on the date of exercise of the
Option. The shares to be delivered upon exercise of Options under this Plan
shall be made available, at the discretion of the Board, either from authorized
but unissued shares or from previously issued and reacquired shares of Stock
held by the Corporation as treasury shares, including shares purchased in the
open market.
6.8 OPTION UNAFFECTED BY CHANGE IN DUTIES
No Option shall be affected by any change of duties or position of the
optionee (including transfer to or from an Affiliated Corporation), so long as
he or she continues to be an Employee. If an optionee shall cease to be an
Employee for any reason other than death, such Option shall thereafter be
exercisable only to the extent of the purchase rights, if any, which have
accrued as of the date of such cessation; provided that (i) the Committee may
provide in the instrument evidencing any Option that the Committee may in its
absolute discretion, upon any such cessation of employment, determine (but be
under no obligation to determine) that such accrued purchase rights shall be
deemed to include additional shares covered by such Option and (ii) unless the
Committee shall otherwise provide in the instrument evidencing any Option, upon
any such cessation of employment, such remaining rights to purchase shall in any
event terminate upon the expiration of the original term of the Option where
such cessation of employment is on account of retirement under a Corporation
sponsored retirement plan on or after the Employee attains age sixty, on account
of long-term disability, or on account of any other reason specified by the
Committee, or its delegate, for the purpose of making this clause applicable,
and otherwise, upon the expiration of three months from such date of
termination, but in no event later than the expiration of the original term of
the Option.
6.9 DEATH OF OPTIONEE
Should an optionee die while in possession of the legal right to exercise
an Option or Options under this Plan, such person (the "personal
representative") as shall have acquired, by will or by the laws of descent and
distribution, the right to exercise any Option theretofore granted may exercise
such Option (i) at any time up to the expiration of the original term of the
Option in the following cases: (a) where the optionee was an Employee on the
date of death and (b) where the optionee was not an Employee on the date of
death and his or her employment ceased on account of retirement under a
Corporation sponsored plan on or after the Employee attained age sixty, on
account of long term disability, or on account of any other reason specifically
approved by the Committee or its delegate for the purpose of making this clause
applicable; or (ii) at any time prior to one year from the date of death where
the optionee was not an Employee on the date of death and his or her employment
ceased on account of a cause other than those specified in clause (i)(b) above,
provided that such Option shall expire in all events no later than the last day
of the original term of such Option, and provided further, that any such
exercise shall be limited to the purchase rights which have accrued as of the
date when the optionee ceased to be such an Employee, whether by death or
otherwise, provided further, however, that the Committee may provide in the
instrument evidencing any Option that all shares covered by such Option shall
become subject to purchase immediately upon the death of the optionee.
ARTICLE VII--BENEFITS PLANS
Incentive Awards, Awards of Restricted Stock and Awards of Options under
the Plan are discretionary and are additional to and not a part of regular
salary. Incentive Awards, Awards of Restricted Stock and Awards of Options may
not be used in determining the amount of compensation for any purpose under the
benefit plans of the Corporation, or an Affiliated Corporation, except (1) an
Incentive Award made to an
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Employee may be used in determining the amount of compensation for the purpose
of any retirement or life insurance plan of the Corporation and its Affiliated
Corporations to the extent provided from time to time in such plan, and (2) as
the Committee may otherwise from time to time expressly provide.
ARTICLE VIII--AMENDMENT, SUSPENSION OR TERMINATION OF THE PLAN
The Board may suspend the Plan or any part thereof at any time or may
terminate the Plan in its entirety. Awards shall not be granted under any part
of the Plan affected by a suspension, nor shall Awards be granted after Plan
termination.
The Board may also amend the Plan from time to time, except that amendments
which affect the following subjects must be approved by shareholders of the
Corporation:
(a) The qualifications for eligibility to become or remain a member of
the Committee;
(b) The Performance Measures and the amounts of the Short-Term Incentive
Awards and the Long-Term Incentive Awards for Named Executive Officers;
(c) Except as provided in Article IX relating to capital changes, the
number of shares in the Authorized Share Pool for any calendar year, the
maximum number of shares of Stock upon which Options may be granted to any
person in any calendar year and the maximum number of shares of Restricted
Stock that may be awarded to any person pursuant to Section 5.3(d);
(d) The maximum term of Options granted;
(e) The minimum Option Price;
(f) The term of the Plan;
(g) The requirements as to eligibility for participation in the Plan;
(h) The prohibition against granting Awards to a member of the
Committee; and
(i) The provision requiring that Employees to whom the Committee has
delegated final authority to determine Awards under the Plan are
eligible only for Awards granted directly by the Committee.
Awards granted prior to suspension or termination of the Plan may not be
cancelled solely because of such suspension or termination, except with the
consent of the grantee of the Award.
ARTICLE IX--CHANGES IN CAPITAL STRUCTURE
Stock, Stock Equivalents, Restricted Stock and the instruments evidencing
Options granted hereunder shall be subject to adjustments in the event of
changes in the outstanding stock of the Corporation by reason of Stock
dividends, Stock splits, recapitalizations, reorganizations, mergers,
consolidations, combinations, exchanges or other relevant changes in
capitalization occurring after the date of an Award to the same extent as would
affect an actual share of Stock issued and outstanding on the effective date of
such change. In the event of any such change, the aggregate number and classes
of shares comprising the Authorized Share Pool for the calendar year in which
such change occurs, the number of shares upon which Options may thereafter be
granted to any person pursuant to Section 6.2, and the number of shares of
Restricted Stock that may thereafter be awarded to any person pursuant to
Section 5.3(d) shall be appropriately adjusted as determined by the Board so as
to reflect such change.
ARTICLE X--EFFECTIVE DATE AND TERM OF THE PLAN
The Plan became effective January 1, 1995, subject to the affirmative vote
of the holders of shares entitled to cast a majority of the votes entitled to be
cast (in person or by proxy) for or against approval of the Plan at the Annual
Meeting of the shareholders of the Corporation in 1995. The Plan shall continue
until such time as it may be terminated by action of the Board; provided,
however, that the Plan, if not so terminated, shall be submitted to the
shareholders of the Corporation for their approval not later than December 31,
2000. No Options may be granted under this Plan subsequent to April 30, 2000.
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ARTICLE XI--TRANSITION--1991 INCENTIVE COMPENSATION AND STOCK OPTION PLAN
(a) This Plan supersedes the Prior Plan, and no new Incentive Awards or
Options, as defined in the Prior Plan, may be granted under the Prior Plan after
the effective date of this Plan, except that (i) short-term incentive awards in
respect of 1994 shall be payable pursuant to the Prior Plan in 1995 and (ii)
options granted in 1995 to persons, other than Named Executive Officers, that
are subject to the laws of any foreign jurisdiction that require, or condition
favorable tax treatment on, approval of the plan pursuant to which options are
granted prior to the grant thereof shall be granted pursuant to the Prior Plan
but shall count against the Authorized Share Pool for 1995; provided that
nothing herein shall modify the terms of the Prior Plan if this Plan is not
approved by vote of the shareholders of the Corporation as contemplated by
Article X. Incentive Awards including conditional Incentive Awards made and
Options granted under the Prior Plan before the effective date of this Plan
shall remain outstanding and shall be administered under the terms of the Prior
Plan.
(b) Any Awards granted under this Plan prior to approval of this Plan by
the shareholders of the Corporation shall be conditional upon, and forfeited
upon the failure of, such approval at the Annual Meeting of Stockholders of
Mobil Corporation in 1995; provided that failing such approval any such Award to
a person other than a Named Executive Officer that could have been granted under
the terms of the Prior Plan may, in the discretion of the Committee, be deemed
to have been so granted.
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