EXHIBIT 10.1
[GTECH CORPORATION LOGO]
SENIOR STAFF OFFICER STOCK OWNERSHIP PLAN
DOCUMENT
1 JULY 2003
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PURPOSE AND PHILOSOPHY:
Grants of restricted shares and stock options of GTECH Holdings Corporation are
a valuable tool for the Company to reward high impact individuals and align key
leaders' interests with those of the shareholders. As such, the Company will
require that Senior Staff Officers maintain ownership of stock equivalent to a
percentage of their base salary.
APPROVALS:
This Senior Staff Officer Stock Ownership Plan was approved by the Compensation
Committee of the Board of Directors as documented in secretary minutes for
February 27, 2003.
PARTICIPANTS:
Senior Staff Officers required to participate in the Plan are:
CEO, COO, SVP and CTO, SVP Business Development and Government Affairs, SVP
Global Services, SVP Corporate Development, SVP and General Counsel, CFO, SVP
Human Resources and such other Officers who may be appointed to the Senior
Staff.
PLAN DESIGN:
Stock ownership requirements are based on a multiple of the participant's salary
as adjusted for the applicable fiscal year. The CEO is required to attain
ownership equal to two times (2X) base salary. All other Senior Staff Officers
are required to attain ownership equal to one times (1X) base salary.
Required participation will commence at the beginning of the
fiscal year (including for new hires). Fiscal Year 2004 is the
first year of the Plan. Participants will be required to meet
the ownership target under the following schedule:
- ---------------------------------------------
Year % Ownership Requirement % of Salary
- ---------------------------------------------
CEO SVP
- ---------------------------------------------
1 20 40 20
- ---------------------------------------------
2 40 80 40
- ---------------------------------------------
3 60 120 60
- ---------------------------------------------
4 80 160 80
- ---------------------------------------------
5 100 200 100
- ---------------------------------------------
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VALUE DETERMINATION:
Target achievement compliance will be measured at the end of each fiscal year
based on the participants' fiscal year-end salary and the value of Qualifying
Shares, as defined below, determined utilizing the average closing stock price
for the 30 trading days prior to the fiscal year-end. Compliance will also be
measured in the manner set forth below before any sales of stock or exercises of
options are approved by the Legal Department under the Insider Trading Policy.
OWNERSHIP:
In order to satisfy the ownership guidelines, the participant must own and hold
Unencumbered Qualifying Shares, which may include any combination of the
following:
1. The vested portion of stock awarded under the
Management Incentive Plan, (irrespective of transfer
restrictions).
2. The vested portion of annual restricted stock awards,
if any, granted as part of the Long-term Incentive
Plan.
3. Shares acquired through the ESPP (irrespective of
transfer restrictions).
4. Shares purchased by the participant in the open
market.
5. Exercised options to the extent they are retained by
the participant.
6. Any other vested and unencumbered shares owned or
earned by the participant.
The following are excluded from the definition of Qualifying Shares:
1. Unexercised options or options which have been
exercised if the acquired shares are sold.
2. Unvested restricted stock grants.
3. The unvested portion of any restricted stock awards,
including the discounted portion under the Management
Incentive Plan.
4. Other encumbered shares. An "Encumbered" share is
defined as any share of GTECH stock in which the
individual owns less than 100% of the ownership
interest or which possesses a substantial risk of
forfeiture, including shares held on margin, shares
pledged as collateral and shares held in joint
ownership or contributed to a trust. However, stock
transfer restrictions alone do not cause stock to be
considered encumbered for purposes of this plan.
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SALE OR TRANSFER OF SHARES:
1. The sale and/or transfer of shares of stock,
including options or shares acquired by the exercise
of options, is allowed for the amount of the value of
shares in excess of the ownership requirement in
effect at the time of the proposed sale or transfer.
2. Sale and/or transfer of stock, including options or
shares acquired by the exercise of options, is
prohibited if the participant is not in compliance
with the target or a sale or transfer will result in
the participant falling out of compliance.
3. For the purposes of a sale or transfer, compliance
will be measured at the time of the proposed sale or
transfer. The ownership requirement will be based on
a quarterly measurement at the point in time during
the year in which the sale or transfer is to be made.
(For example, if the transfer is proposed in the
first quarter, 25% of the requirement for that fiscal
year will apply.) The stock value used for
measurement will be the market value on the date of a
request for approval to sell or transfer shares.
4. Nothing in this plan requires the participant to
enter the market and purchase additional shares in
the event the executive is not in compliance with the
ownership guidelines.
5. Participants must receive approval from the Legal
Department, in accordance with the Insider Trading
Policy and this plan, before executing any sale of
transfer of GTECH stock or options.
6. Participants are permitted to sell shares,
irrespective of this Plan, solely for the purpose of
paying applicable taxes on any vesting shares.
HARDSHIP:
The participant may petition the Compensation
Committee for relief from the plan requirements in
cases of hardship or exceptional circumstances. The
Compensation Committee has sole discretion to grant
an exception to the plan.
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