EXHIBIT 10.5(c)
AGREEMENT TO DEFER RECEIPT OF SHARES
FOLLOWING OPTION EXERCISE
Fill in all of the following blanks with respect to your election to defer
receipt of shares following an option exercise. Please print. Complete a
separate Agreement to Defer for each option grant for which you elect to defer.
Date:
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Name:
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Date of Option Grant:
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Option Grant Number (e.g. 001462):
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Name of Option Plan
(e.g., 1990 Stock Option Plan):
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Number of Shares Remaining to be Exercised in Option:
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Number of Shares Covered by this Deferral Election:
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Date of Distribution:
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(See Paragraph 7 below for instructions.)
Beneficiary designation:
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(See Paragraph 12 and 13 below.)
This Agreement is made and entered into as of the date stated above by and
between the individual named above (the "Participant") and First Tennessee
National Corporation (the "Corporation").
WITNESSETH
WHEREAS, the Corporation has established a stock option enhancement program
(the "Program") for certain employees of the Corporation and its subsidiaries
pursuant to which the grantee of a stock option who complies with the terms and
conditions of the Program is permitted to elect to defer receipt of shares
covered by an option and thereby defer recognition of income for federal income
tax purposes at the time of the option exercise; and
WHEREAS, Participant has been selected to participate in the Program,
subject to the right of the Human Resources Committee of the Board of Directors
to cancel the Program as to any unexercised options;
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NOW, THEREFORE, in consideration of the promises made herein, Participant
and the Corporation do agree as follows:
1. Subject to the terms and conditions of the Program described below,
Participant hereby irrevocably elects to defer receipt of the shares
specified following the exercise of the option, or portion thereof,
specified for the period of time specified, and the Corporation agrees
to deliver to Participant at the time specified the shares whose
receipt has been deferred (adjusted to reflect any stock splits and
stock dividends as described below) and an amount of cash equivalent
to the dividends that would have been paid had Participant received
the shares immediately following the exercise of the option plus
interest on such dividend equivalents at a 10-year Treasury rate of
interest, all as described below.
2. Participant is permitted to exercise the option covered by this
Agreement at any time beginning at least 6 months after the date of
this deferral agreement and ending on the last day of the term of the
option.
3. If Participant has elected to defer receipt of a number of shares that
is less than the number of shares that is exercisable under the
option, then the receipt of shares will be deferred as follows: on the
first (and, if necessary, subsequent) exercise of the option occurring
at least 6 months following the date of this deferral agreement,
receipt of shares will be deferred until the number of shares elected
for deferral has been reached.
4. The option cannot be exercised by tendering cash in payment of the
exercise price. Participant must pay the exercise price with
Corporation common stock. Participant must use the "attestation"
method of exercising the option. Under the attestation method,
Participant (and, if applicable, Participant's broker or bank or other
party) must sign an attestation form, which must be submitted at the
time of the option exercise, certifying ownership of a sufficient
number of shares of Corporation common stock to pay the exercise
price. Actual share certificates are not to be delivered to the
Corporation.
5. The shares attested to must be "mature" shares; that is, the shares
must either have been purchased on the open market by Participant or
if the shares were acquired directly from the Corporation pursuant to
an employee benefit plan, the shares must have been owned without any
restrictions on transfer for at least six months prior to the option
exercise.
6. Participant must be a current employee of the Corporation or one of
its subsidiaries both at the time of execution of this Agreement and
at the time of the exercise of the option. If Participant's employment
terminates for any reason prior to the exercise of the option, then
this Agreement is canceled.
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7. Participant must select a deferral period, at the end of which shares
whose receipt has been deferred and earnings thereon will be paid to
Participant, subject to Paragraph 12 herein. The payment date is
referred to herein as the "Date of Distribution." Participant may
specify any future date, not to exceed actual retirement plus five
years, as the Date of Distribution. Alternatively, Participant may
specify payment to be made "on retirement" or "on retirement plus
___________ years and __________ months." Under this alternative, the
payment date may not exceed actual retirement plus five years. For all
purposes hereof, the term "retirement" includes any retirement,
whether it is a normal or an early retirement. If the Date of
Distribution is not a business day, payment will be made on the next
day that is a business day.
8. When Participant decides to exercise the option, Participant must
exercise the option for all of the shares covered by this deferral
election. Upon the exercise of the option, no shares will be
transferred to Participant and a deferral account will be established
by the Corporation, consisting of a subaccount reflecting phantom
stock units and a subaccount representing cash equal to the earnings
credited to the account with respect to dividend equivalents and
interest thereon. Participant's phantom stock subaccount will be
credited with phantom stock units, based on the number of shares
covered by this deferral election with respect to which the option was
exercised by Participant, net of the number of shares attested to in
payment of the exercise price, with each phantom stock unit being
equivalent to one share of the Corporation's common stock. (NOTE: The
number of phantom stock units credited to Participant's account is
equal to the number of shares covered by the deferral election minus
the number of shares attested to in payment of the option exercise
price.)
9. Any stock split and stock dividend that is declared with respect to
the Corporation's common stock having a payment date that occurs after
exercise of the option and before the deferral period has terminated
will result in a corresponding stock split or stock dividend being
made with respect to the phantom shares of the Corporation's common
stock in Participant's deferral account. In other words, Participant
will be issued that number of shares of the Corporation's common stock
at the termination of the deferral period that Participant would have
owned had he or she exercised the option without deferring receipt of
the shares and then maintained ownership of such common stock through
the payment date of the stock dividend or stock split.
10. Earnings will be credited to Participant's cash subaccount and accrued
on the phantom stock units as follows: on each date on which the
Corporation pays a dividend on its shares of common stock, an amount
equal to such dividend will be credited to Participant's account with
respect to each phantom stock unit. Then, as of January 1st of each
year, an additional amount will be credited to Participant's account
to reflect earnings on the dividend equivalents from the time they
were credited to the account for the prior plan year. The rate of
earnings credited for the year will be the rate disclosed under the
caption "Annualized Ten Year Treasury Rate" in the Federal Reserve
Statistical Release in January of the year following the
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year with respect to which earnings are to be credited, and the amount
will be computed by multiplying the dividend equivalent by the rate by
a factor representing the fraction of the year (100% for a January 1
dividend equivalent, 75% for an April 1 dividend equivalent, 50% for a
July 1 dividend equivalent, and 25% for a October 1 dividend
equivalent) remaining after the dividend equivalent was credited to
Participant's account. Interest will compound as follows: for any cash
credited to the account that existed on the first day of the prior
plan year (excluding any dividend equivalent that is credited to the
account on such day), earnings will be credited in an amount equal to
the amount of such cash multiplied by the applicable ten year treasury
rate factor. For the portion of the Plan year in which the Date of
Distribution occurs, earnings will be credited on any cash credited to
the account during such year from the time such cash is credited
through the Date of Distribution at the rate employed for the previous
year.
11. Payment from Participant's deferral account will be made in a single
lump sum, computed as follows: with respect to Participant's phantom
stock subaccount, one share of the Corporation's common stock will be
paid to Participant for each phantom stock unit credited to such
subaccount, and with respect to Participant's cash subaccount, cash in
the amount credited to the subaccount will be paid to Participant.
12. Payment from Participant's deferral account will be made to
Participant (or, in the event of Participant's death, his or her
beneficiary) on the earliest of the date selected by Participant as
the Date of Distribution, the date of a change in control as defined
in the Plan specified above or a date selected by the Corporation
following Participant's death, disability, or termination of
employment for any reason other than normal or early retirement that
is no later than the last day of the month following the month in
which there occurs the death, disability, or termination of employment
of Participant for any reason other than normal or early retirement.
13. For any and all purposes of this deferral agreement and the Plan
specified above, Participant designates the person specified above as
his/her beneficiary under the Plan.
14. Participant is limited to one deferral agreement per option grant
outstanding at any one time.
15. The Human Resources Committee of the Board of Directors retains the
right to cancel the Program and prohibit deferral of receipt of shares
following an option exercise with respect to any unexercised options
then held by Participant upon notice to Participant.
16. The Human Resources Committee is authorized to interpret and
administer the Program and the terms and provisions of this Agreement.
IN WITNESS WHEREOF, Participant has executed and the Corporation has caused
its duly
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authorized officer to execute this Agreement, each as of the day and year first
above written.
FIRST TENNESSEE NATIONAL CORPORATION
By:
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Executive Vice President, Participant
Division Manager Personnel,
or other authorized signatory
Risk Statement:
If the fair market value of Corporation common stock drops below the fair market
value on the date of exercise of the option (with respect to which receipt of
shares is deferred) and does not recover before the end of the deferral period,
a portion of the value of such shares will be lost. Thereafter, the value of
such shares may increase or decrease further.
If Participant does not exercise the option covered by this Agreement in
accordance with all of the terms of this Agreement, the option will be forfeited
by Participant and canceled by the Corporation.
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