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EXHIBIT 10.21
ARCH CHEMICALS, INC.
ANNUAL INCENTIVE PLAN
(As amended December 9, 1999 and April 27, 2000)
1. Adoption and Purpose. The Company hereby adopts this
Plan providing for the award of annual incentive compensation to selected
employees of the Company and its Subsidiaries if specified Performance Goals are
achieved. The general purpose of the Plan is to promote the interests of the
Company and its Subsidiaries by providing to their employees incentives to
continue and increase their efforts with respect to, and remain in the employ
of, the Company and its Subsidiaries.
2. Administration. The Plan will be administered by the
Administrator.
Subject to the express provisions of the Plan, the
Administrator shall have plenary authority, in its discretion, to administer the
Plan and to exercise all powers and authority either specifically granted to it
under the Plan or necessary and advisable in the administration of the Plan,
including without limitation the authority to interpret the Plan; to prescribe,
amend and rescind rules and regulations relating to the Plan; to grant Awards,
to determine the terms, provisions and conditions of all Awards granted under
the Plan (which need not be identical), the individuals to whom and the time or
times when Awards shall be granted, and to make all other necessary or advisable
determinations with respect to the Plan. The determination of the Administrator
on such matters shall be conclusive.
3. Participants. The Administrator shall from time to
time select the officers and key employees of the Company and its Subsidiaries
to whom Awards are to be granted, and who will, upon such grant, become
participants in the Plan.
4. Performance Awards. (a) The Performance Goals and
Performance Period applicable to an Award shall be determined by the
Administrator no later than 90 days after the commencement of the Performance
Period and shall be communicated to the Participant; provided for the 1999
Performance Period, not later than August 1, 1999. For those employees of the
Company or any Subsidiaries who become Participants after January 1 of a given
year, such determination shall be made for the Performance Period as soon as
practicable by the Administrator. The Administrator shall have the discretion to
later revise the Performance Goals.
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(b) In making an Award, the Administrator may take
into account an employee's responsibility level, performance, cash compensation
level, incentive compensation awards and such other considerations as it deems
appropriate. Each Award shall be established in dollars and shall be based on
the Company's Performance Goals for the Performance Period.
5. Employment. Except as provided in the next sentence,
and unless the Administrator otherwise decides following termination, an Award
shall terminate for all purposes if the Participant is not an employee in good
standing with the Company or any subsidiary on the last day of the Performance
Period. The Participant (or in the event of the Participant's death, his or her
beneficiaries or estate) whose employment was terminated prior to such last day
because of death, disability or Retirement will be considered as the
Administrator determines in its sole discretion for pro rata portion of the
payment of his or her Award based upon the portion of the Performance Period
during which he or she was so employed so long as the Performance Goals are
subsequently achieved.
6. Vesting and Payment of Awards. Awards shall not vest
in a Participant until actually paid; provided however, that if all or a portion
of an Award for a Performance Period is based on a Performance Goal that is a
financial goal (including the payout of any bonus bank amount), such portion of
an Award shall vest on the last day of such Performance Period in those
Participants who are employees of the Company or its subsidiaries on such last
day to the extent earned as a result of the achievement of such financial
Performance Goal. The vested Award for the Participants who were employed on
such last day but were not so employed continuously throughout such Performance
Period shall be prorated to reflect the period during which they were employed
by the Company or its subsidiary during the Performance Period. Payment with
respect to an Award will be distributed in a lump sum wholly in cash as soon as
practicable following the determination of actual performance and approval by
the Administrator that the Performance Goals with respect to an Award has been
met. Required withholding taxes shall be withheld from the payment of any Award.
7. Deferral. Participants may defer the payment of
Awards subject to and as provided in the Employee Deferral Plan (or its
successor).
8. Nonexclusive Plan. The adoption of the Plan by the
Company shall not be construed as creating any limitation on the power of the
Administrator to adopt such other incentive arrangements as it may deem
desirable and such arrangements may be either generally applicable or applicable
only in specific cases.
9. Nonassignability. No Awards may be transferred,
alienated, pledged or assigned other than by will or by the laws of descent and
distribution.
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10. Amendment or Discontinuance. The Plan may be amended,
terminated or discontinued by the Administrator at any time as the Administrator
determines. Upon termination of the Plan, unvested Awards shall terminate and
participants shall have no rights to unvested Awards.
11. Effect of Plan. Neither the adoption of the Plan nor
any action of the Administrator shall be deemed to give any officer or employee
any right to continued employment or any other rights.
12. Plan Remains Unfunded. Nothing contained in this Plan
shall be deemed to create a trust or fund of any kind or create any fiduciary
relationship whether or not the Company elects to fund the Plan through a "rabbi
trust". Nothing contained herein shall be deemed to give any Participant any
ownership or other proprietary, security or other rights in any funds, stock or
assets owned or possessed by the Company, whether or not earmarked for the
Company's own purposes as a reserve or fund to be utilized by the Company for
the discharge of its obligations hereunder. To the extent that any person
acquires a right to receive payments or distributions from the Company under
this Plan, such right shall be no greater than the right of any unsecured
creditor of the Company.
13. Effective Date of Plan. The Plan shall take effect as
of January 1, 1999.
14. Governing Law. This Plan shall be governed by the
laws of the State of Connecticut without giving effect to its conflicts of law.
15. Definitions. For the purpose of this Plan, unless the
context requires otherwise, the following terms shall have the meanings
indicated:
(a) "Administrator" means at the time of a
determination (1) for Participants who (A) report to the Chief
Executive Officer, (B) are subject to Section 16 of the Securities
Exchange Act of 1934, as amended, and (C) are officers of the Company
elected by the Board, the Committee and (2) for all other Participants,
the Chief Executive Officer of the Company (or his or her designees or
delegatees).
(b) "Award" means an incentive award made
pursuant to the Plan, the payment of which is contingent upon
attainment of Performance Goals.
(c) "Board" means the board of directors of the
Company.
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(d) "Committee" means the Compensation Committee
of the Board (or its successor committee).
(e) "Company" means Arch Chemicals, Inc., a
Virginia corporation.
(f) "Participant" means an individual selected
by the Administrator to participate in the plan for a fiscal year.
(g) "Performance Goals" means performance goal
(or goals) and formulae as may be established by the Administrator
which shall be based on the one or more financial or nonfinancial
performance factors as the Administrator selects with respect to the
Performance Period.
(h) "Performance Period" means the fiscal year
of the Company or such other period of time as is designated by the
Administrator during which the Performance Goals are measured.
(i) "Plan" means this Arch Chemicals, Inc.
Annual Incentive Plan as amended from time to time.
(j) "Retirement" means, with respect to any
participant, the participant's retirement as an employee of the Company
on or after reaching age 55 with at least ten years of service.
(k) "Subsidiary" means any corporation in an
unbroken chain of corporations beginning with the Company if, at the
time of the granting of the Award, each of the corporations other than
the last corporation in the unbroken chain owns stock possessing 50% or
more of the total combined voting power of all classes of stock in one
of the other corporations in the chain. The "Subsidiaries" means more
than one of any such corporations.