EXHIBIT 10.1
DELTIC TIMBER CORPORATION
1996 Stock Incentive Plan
SECTION 1. Purpose
The purpose of the Deltic Timber Corporation Stock Incentive Plan is to
foster and promote the long-term financial success of the Company and materially
increase shareholder value by (a) motivating superior performance by means of
performance-related incentives, (b) encouraging and providing for the
acquisition of an ownership interest in the Company by Employees, and (c)
enabling the Company to attract and retain the services of an outstanding
management team upon whose judgment, interest, and special effort the successful
conduct of its operations is largely dependent.
SECTION 2. Definitions
Unless the context otherwise indicates, the following definitions shall be
applicable for the purpose of the 1996 Stock Incentive Plan:
"Agreement" shall mean a written agreement setting forth the terms of an
Award.
"Award" shall mean any Option (which may be designated as a Nonqualified or
Incentive Stock Option), a Stock Appreciation Right or a Restricted Stock Award,
in each case granted under this Plan.
"Beneficiary" shall mean the person, persons, trust or trusts designated by
an Employee or if no designation has been made, the person, persons, trust or
trusts entitled by will or the laws of descent and distribution to receive the
benefits specified under this Plan in the event of an Employee's death.
"Board" shall mean the Board of Directors of the Company.
"Code" means the Internal Revenue Code of 1986, as amended.
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"Committee" shall mean the Executive Compensation Committee of the Board,
as from time to time constituted, or any successor committee of the Board with
similar functions. The Committee shall be constituted to comply with the
requirements of Rule 16b-3 promulgated by the Securities and Exchange Commission
under the Securities Exchange Act of 1934, or such rule or any successor rule
thereto which is in effect from time to time.
"Common Stock" shall mean the Common Stock of the Company, $0.01 par value,
subject to adjustment pursuant to Section 11.
"Company" shall mean Deltic Timber Corporation, a Delaware corporation.
"Employee" shall mean any person employed by the Company on a full-time
salaried basis or by a subsidiary that does not have in effect for its personnel
any plan similar to the Plan, including officers and employee directors thereof.
"Incentive Stock Option" or "ISO" shall mean an Option that is intended by
the Committee to meet the requirements of Section 422 of the Code or any
successor provision.
"Nonqualified Stock Option" or "NQSO" shall mean an Option granted pursuant
to this Plan which does not qualify as an Incentive Stock Option.
"Normal Termination" shall mean a termination of employment (i) at normal
retirement time, (ii) for permanent and total disability, or (iii) with Company
approval, and without being terminated for cause.
"Option" shall mean the right to purchase Common Stock at a price to be
specified and upon terms to be designated by the Committee pursuant to this
Plan. An Option shall be designated by the Committee as a Nonqualified Stock
Option or an Incentive Stock Option at the time of grant.
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"Opportunity Shares" shall mean additional shares of Common Stock which may
be earned by an Employee pursuant to Section 8 hereof.
"Option Holder" or "Holder" shall mean an Employee to whom an option has
been granted.
"Personal Representative" shall mean the person or persons who, upon the
disability or incompetence of an Employee, shall have acquired on behalf of the
Employee by legal proceeding or otherwise the right to receive the benefits
specified in this Plan.
"Plan" shall mean this 1996 Stock Incentive Plan.
"Replacement Shares" shall mean shares which may be awarded to Employees as
Option(s) or as Restrictive Stock in such amount and at such value as may be
determined by the Committee to be sufficient to replace similar awards from
Murphy Oil Corporation which were forfeited by Employees by virtue of their
employment by the Company.
"Restricted Period" shall mean the period designated by the Committee
during which Restricted Stock may not be sold, assigned, transferred, pledged,
or otherwise encumbered and during which such stock is subject to forfeiture.
"Restricted Stock" shall mean those shares of Common Stock issued pursuant
to a Restricted Stock Award which are subject to the restrictions, terms, and
conditions specified by the Committee pursuant to Section 8 hereof.
"Restricted Stock Award" shall mean an award of Restricted Stock pursuant
to Section 8 hereof.
"Stock Appreciation Right" or "SAR" shall mean the right of the holder to
receive, upon exercise thereof, payment of an amount determined by
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multiplying: (a) any increase in the Fair Market Value of a share of Common
Stock at the date of exercise over the price fixed by the Committee at the date
of grant, by (b) the number of shares with respect to which the SAR is
exercised; provided, however, that at the time of grant, the Committee may
establish, in its sole discretion, a maximum amount per share which will be
payable upon exercise of a SAR. The amount payable upon exercise may be paid in
cash or other property, including without limitation shares of Common Stock, or
any combination thereof as determined by the Committee.
SECTION 3. Administration
The Plan shall be administered by the Committee. In addition to any implied
powers and duties that may be needed to carry out the provisions of the Plan,
the Committee shall have all of the powers vested in it by the terms of the
Plan, including exclusive authority to select the Employees to be granted Awards
under the Plan, to determine the type, size and terms of the Awards to be made
to each Employee selected, to determine the time when Awards will be granted,
and to prescribe the form of the Agreements embodying Awards made under the
Plan. No member of the Committee, while he serves on the Committee, may be
granted Awards under the Plan. The Committee shall be authorized to interpret
the Plan and the Awards granted under the Plan, to establish, amend and rescind
any rules and regulations relating to the Plan, to make any other determinations
which it believes necessary or advisable for the administration of the Plan, and
to correct any defect or supply any omission or reconcile any inconsistency in
the Plan or in any Award in the manner and to the extent the Committee deems
desirable to carry it into effect. Any decision of
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the Committee in the administration of the Plan, as described herein, shall be
final and conclusive.
The Board may from time to time remove members from the Committee or add
members thereto, and vacancies in the Committee, however caused, shall be filled
by action of the Board. The Committee shall select one of its members as
chairman and shall hold its meetings at such time and places as it may
determine. The Committee may act only by a majority of its members. The members
of the Committee may receive such compensation for their services as the Board
may determine. Any determination of the Committee may be made, without notice,
by the written consent of the majority of the members of the Committee. In
addition, the Committee may authorize any one or more of their number or any
officer of the Company to execute and deliver documents on behalf of the
Committee.
SECTION 4. Stock Subject to the Plan
The aggregate maximum number of shares which may be issued under the Plan
shall be 1.2 million. Subject to the aggregate maximum limit, the maximum number
of shares available for Awards under the Plan in each calendar year during any
part of which the Plan shall be in effect shall be one-half of one percent
(0.5%) of the total issued and outstanding shares as of the date of issuance of
the shares, excluding any Replacement Shares issued due to the spin-off from
Murphy Oil Corporation. In subsequent years, the Committee may award up to one-
half of one percent of the total issued and outstanding shares as of December 31
of the immediately preceding year for long-term Awards. Any and all such shares
may be issued in respect of any of the types of Awards; provided, however no
more than fifty percent (50%) of the shares available shall be available for
Awards under the Plan
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shall be issued in respect of Restricted Stock. Unless otherwise determined by
the Committee, all shares available in any year that are not granted under the
Plan will not be available for grant for subsequent years.
If any shares of Common Stock subject to an Award hereunder are forfeited
or any such Award otherwise terminates without the issuance of shares of Common
Stock or other consideration to an Employee, such shares, shall not increase the
number of shares available for grant in such year.
SECTION 5. Eligibility
Any Employee who is a director or an officer or who serves in any other key
administration, professional or technical capacity shall be eligible to
participate in the Plan. In addition the Committee may in any year include any
other Employee who the Committee has determined has made some unusual
contribution which would not be expected of such Employee in the ordinary course
of his work.
SECTION 6. Stock Options
A. Grant of Options and Price.
(a) Any Option granted under the Plan may be granted as an Incentive Stock
Option or as a Nonqualified Stock Option, as shall be designated by the
Committee at the time of the grant of such Option. Each Option shall be
evidenced by an Agreement between the recipient and the Company, which Agreement
shall specify the designation of the Option as an ISO or a NQSO, as the case may
be, and shall contain such terms and conditions not inconsistent with the Plan
as the Committee, in its sole discretion, may determine in accordance with the
Plan. The maximum Option that an Employee may receive in a calendar year is
50,000 shares; and in addition, as
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to Incentive Stock Options, the aggregate fair market value (determined on the
date the option is granted) any Employee may receive in any calendar year shall
not exceed $100,000.
(b) The exercise price for the purchase of Common Stock to be issued pursuant to
each Option shall be fixed by the Committee at the time of the granting of the
Option provided, however, that except with respect to the exercise price for
Replacement Shares, such exercise price shall in no event be less than the fair
market value of the Common Stock on the date such Option is granted. With
respect to the exercise price for Replacement Shares, the Committee may fix an
exercise price at any value as it may determine.
B. Exercise.
The period during which an Option may be exercised shall be determined by
the Committee; provided, that such period will not be longer than ten years from
the date on which the Option is granted. The date or dates on which portions of
an Option may be exercised during the term of an Option shall be determined by
the Committee. In no case may an Option be exercised at any time for fewer than
50 shares (or the total remaining shares covered by the Option if fewer than 50
shares) during the term of the Option. An Option which is granted in tandem with
a SAR may only be exercised upon the surrender of the right to exercise such SAR
for an equivalent number of shares.
C. Payment for Shares.
The exercise price for the Common Stock shall be paid in full when the
Option is exercised. Subject to such rules as the Committee may impose, the
exercise price
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may be paid in whole or in part in (i) cash, (ii) whole shares of Common Stock
evidenced by negotiable certificates, valued at their fair market value on the
date of exercise, (iii) by a combination of such methods of payment, or (iv)
such other consideration as shall be approved by the Committee.
SECTION 7. Stock Appreciation Rights
Stock Appreciation Rights may be granted to participants at such time or
times as shall be determined by the Committee and shall be subject to such terms
and conditions as the Committee may impose. A grant of a SAR shall be made
pursuant to a written agreement containing such provisions not inconsistent with
the Plan as the Committee shall approve.
SARs may be exercised at such times or subject to such conditions as the
Committee shall impose, either at or after the time of grant. SARs which are
granted in tandem with an Option may only be exercised upon the surrender of the
right to exercise such Option for an equivalent number of shares and may be
exercised only with respect to the shares of Stock for which the related Option
is then exercisable. Option shares with respect to which a tandem SAR shall have
been exercised for cash shall not again be available for an Award under this
Plan. Notwithstanding any other provision of the Plan, the Committee may impose
such conditions on the exercise of a SAR (including, without limitation, the
right of the Committee to limit the time of exercise to specified periods) as
may be required to satisfy the applicable provisions of Rule 16b-3 as
promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange
Act").
SECTION 8. Restricted Stock Awards
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The Committee may make an award of Restricted Stock to selected Employees,
evidenced by an Agreement which shall contain such terms and conditions,
including without limitation, forfeiture provisions, as the Committee, in its
sole discretion, may determine. The amount of each Restricted Stock Award and
the respective terms and conditions of each Award (which terms and conditions
need not be the same in each case) shall be determined by the Committee in its
sole discretion. The maximum Award that an Employee may receive in a calendar
year is 50,000 shares.
The Committee shall establish performance measures for each Restricted
Period on the basis of such criteria and to accomplish such objectives as the
Committee may from time to time, in its sole discretion, determine. Such
measures may include, but shall not be limited to, total shareholder return,
growth in cash flow per share, growth in earnings per share, return on assets,
or return on stockholder equity. The Committee may from time to time establish
different performance objectives for certain operating subsidiaries or sectors
of the business.
Shares of Restricted Stock will be subject to forfeiture and may not be
sold, transferred, pledged, assigned, or otherwise alienated or hypothecated
until such time or until the satisfaction of such conditions or the occurrence
of such events as shall be determined by the Committee either at or after the
time of grant. Unless otherwise determined by the Committee at the time of
grant, participants holding shares of Restricted Stock granted hereunder may
exercise full voting rights with respect to those shares during the Restricted
Period.
Unless otherwise determined by the Committee at the time of grant,
participants holding shares of Restricted Stock shall be entitled to receive all
dividends and other
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distributions paid with respect to those shares, provided that if any such
dividends or distributions are paid in shares of Stock or other securities, such
shares or securities shall be subject to the same forfeiture restrictions and
restrictions on transferability as apply to the Restricted Stock with respect to
which they were paid.
Each Employee, who has received shares of Common Stock pursuant to a
Restricted Stock Award with respect to which all of the restrictions set forth
in Section 8 shall have lapsed or pursuant to an award of Opportunity Shares
related to such Restricted Stock Award, shall also receive from the Company a
cash payment in the year following the close of the Restricted Period in an
amount determined by the Committee, which amount is intended to allow such
Employee to pay such Employee's tax liability (assuming the highest rates of tax
applicable to any individual taxpayer in the year in which such payment is made)
with respect to (i) such shares and (ii) such cash payment. Provided, however,
unless otherwise determined by the Committee, the cash payment shall in no event
exceed 50% of the fair market value of such shares as of the date that all of
the restrictions set forth in Section 8 shall have lapsed or as to an award of
Opportunity Shares as of the date of grant thereof.
SECTION 9. Termination of Employment
Unless otherwise determined by the Committee, in the event a participant's
employment terminates by reason of Normal Termination, any Options granted to
such participant which are then outstanding may be exercised at the earlier of
any time prior to the expiration of the term of the Options or within two (2)
years after termination and any shares of Restricted Stock then outstanding
shall be prorated for all
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restricted periods then in effect based on the number of months of actual
participation.
Unless otherwise determined by the Committee, in the event a participant's
employment is terminated by reason of death, any Options granted to such
participant which are then outstanding may be exercised by the participant's
beneficiary or the participant's legal representative at any time prior to the
expiration date of the term of the Options or within two (2) years following the
participant's termination of employment, whichever period is shorter, and any
shares of Restricted Stock then outstanding shall be prorated for all restricted
periods then in effect based on the number of months of actual participation.
Unless otherwise determined by the Committee, in the event the employment
of the participant shall terminate for any reason other than the ones described
in this Section, any Options granted to such participant which are then
outstanding shall be cancelled and any shares of Restricted Stock then
outstanding as to which the Restricted Period has not lapsed shall be forfeited.
A change in employment from the Company or one Subsidiary to another
Subsidiary of the Company shall not be considered a termination.
SECTION 10. Change in Control
Notwithstanding any other provision of this Plan or an Agreement to the
contrary, upon a Change in Control, as defined below, all outstanding Awards
shall vest, become immediately exercisable or payable or have all restrictions
lifted as may apply to the type of Award.
A "Change in Control" shall be deemed to have occurred if (i) any "person",
including a "group" (as such terms are used in Sections 13(d) and 14(d)(2) of
the
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Exchange Act, but excluding the Company, any of its subsidiaries or any employee
benefit plan of the Company or any of its subsidiaries or Charles H. Murphy, Jr.
and affiliates of Charles H. Murphy, Jr.) is or becomes the "beneficial owner"
(as defined in Rule 13(d)(3) under the Exchange Act), directly or indirectly, of
securities of the Company representing 25% or more of the combined voting power
of the Company's then outstanding securities; or (ii) the stockholders or the
Board of the Company shall approve a definitive agreement (1) for the merger or
other business combination of the Company with or into another corporation a
majority of the directors of which were not directors of the Company immediately
prior to the merger or in which the stockholders of the Company immediately
prior to the effective date of such merger own less than 50% of the voting power
in such corporation or (2) for the sale or other disposition of all or
substantially all of the assets of the Company.
SECTION 11. Adjustments Upon Changes in Capitalization
In the event of any change in the Common Stock by reason of any stock
split, stock dividend, recapitalization, merger, consolidation, reorganization,
combination, or exchange of shares, split-up, spin-off, share purchase,
liquidation or other similar change in capitalization affecting or involving the
Common Stock, or any distribution to common stockholders other than regular cash
dividends, the Committee shall make such substitution or adjustment, if any, as
it deems equitable, as to the number or kind of shares that may be issued under
the Plan pursuant to Section 4 and the number or kind of shares subject to, or
the price per share under or terms of any outstanding Award. The amount and form
of the substitution or adjustment shall be determined by
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the Committee and any such substitution or adjustment shall be conclusive and
binding on all parties for all purposes of the Plan.
SECTION 12. Miscellaneous Provisions
(a) No Employee or other person shall have any claim or right to be granted an
Award under the Plan and no Award shall confer any right to continued
employment.
(b) An Employee's rights and interest under the Plan or any Award may not be
assigned or transferred in whole or in part, either directly or by operation of
law or otherwise (except in the event of an Employee's death, to the Employee's
Beneficiaries or by will or the laws of descent and distribution), including,
but not by way of limitation, execution, levy, garnishment, attachment, pledge,
bankruptcy or in any other manner, and no such right or interest of any Employee
in the Plan or in any Award shall be subject to any obligation or liability of
such individual. An Award shall be exercisable, during an Employee's lifetime,
only by him or her or his or her Personal Representative. Except as specified in
the applicable Award agreement, the holder of an Award shall have none of the
rights of a shareholder until the shares subject thereto shall have been
registered on the transfer books of the Company.
(c) Any provision of the Plan or any Agreement to the contrary notwithstanding,
no Common Stock shall be issued hereunder unless counsel for the Company shall
be satisfied that such issuance will be in compliance with applicable Federal,
state, or other securities laws.
(d) The Company shall have the power to withhold, or require a participant to
remit to the Company, an amount sufficient to satisfy Federal, state, and local
withholding tax requirements in respect of any Award, or any exercise or vesting
thereof under the Plan, and the Company may defer payment of cash or issuance of
Stock until such
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requirements are satisfied. The Committee may, in its discretion, permit an
Employee to elect, subject to such conditions as the Committee shall impose, (i)
to have shares of Stock otherwise issuable under the Plan withheld by the
Company or (ii) to deliver to the Company previously acquired shares of Stock,
in either case having a fair market value sufficient to satisfy all or part of
the participant's estimated total Federal state, and local tax obligation
associated with the transaction.
(e) The expenses of the Plan shall be borne by the Company, except as set forth
above in subsection (d) of this Section.
(f) Awards granted under the Plan shall be binding upon the Company, its
successors and assigns.
(g) Nothing contained in this Plan shall prevent the Board of Directors from
adopting other or additional compensation arrangements, subject to shareholder
approval if such approval of any such additional arrangement is required.
SECTION 13. Amendment, Modification, and Termination of Plan
The Board may from time to time amend the Plan or any provision thereof
without the consent of the stockholders except in the case of any amendments
that require stockholder approval in order to comply with applicable law or
provisions of stock exchange listing agreements.
The Board may terminate the Plan in whole or in part at any time provided
that no such termination shall impair the terms of Awards then outstanding under
which the obligations of the Company have not been fully discharged.
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SECTION 14. Governing Law
The provisions of this Plan shall be interpreted and construed in
accordance with the laws of the State of Delaware.
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