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EXHIBIT 10.11
KELLOGG COMPANY
STOCK COMPENSATION PROGRAM
FOR
NON-EMPLOYEE DIRECTORS
(as amended)
This is the Stock Compensation Program for Non-Employee Directors of
Kellogg Company (the "Program").
1. Purpose. The purpose of the Program is to attract and retain
outstanding non-employee directors by enabling them to participate in the
Company's growth through automatic, non-discretionary awards of shares of common
stock of the Company.
2. Eligibility. Eligibility for participation in the Program is limited
to persons then currently serving as directors of the Company who are not
"employees" of the Company (or any of its subsidiaries) within the meaning of
the Employee Retirement Income Security Act of 1974 or for federal income tax
withholding purposes (the "Participants").
3. Stock Available for the Program. Shares of stock available for
issuance pursuant to the Program may be either authorized but unissued shares or
shares which have been or may be reacquired by the Company including Treasury
shares of the common stock of the Company, $0.25 par value (the "Stock"). An
aggregate of 374,400 shares of the Stock shall be so available. No awards shall
be made under the Program after 1999.
4. Awards of Restricted Stock. An Annual Award of 1,000 shares of Stock
shall be made to each Participant elected at an annual meeting of stockholders
with at least one year of service following the annual meeting of stockholders.
Participants elected or appointed to the Board at any time other than the annual
meeting of stockholders, shall receive an initial Award on the first anniversary
of the Participant's election or appointment to the Board and a pro-rata Award
at the next annual meeting of stockholders following the first anniversary based
on the number of months from the first anniversary date to the next annual
meeting of stockholders in relation to 12. Thereafter, the full Award shall be
made to such person following each annual meeting of stockholders.
5. Rights of Participants. The Company shall establish a bookkeeping
account in the name of each Participant (the "Stock Account"). As of the date
that shares are awarded to a Participant, the Participant's Stock Account shall
be adjusted to reflect such shares and an aggregate number of shares credited to
each Participant on such date shall be transferred by the Company to the Kellogg
Company Grantor Trust for Non-Employee Directors. Except for the right to direct
the Trustee as to the manner which the shares are to be voted, a Participant
shall not have any rights with respect to any shares credited to the
Participant's Stock Account and transferred to the Trust until the date the
Participant ceases, for any reason, to serve as a director of the Company.
6. Changes in Capitalization or Organization. Nothing contained in this
document shall alter or diminish in any way the right and authority of the
Company to effect
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changes in its capital or organizational structure; provided, however, that the
following procedures shall be recognized.
6.1. Stock Split, Stock Dividend, or Extraordinary Distribution. In
the event the number of shares of common stock of the Company is increased at
any time by a stock split, by declaration by the Board of Directors of the
Company of a dividend payable only in shares of such stock, or by any other
extraordinary distribution of shares, the number of shares granted pursuant to
Article 4 above shall be proportionately adjusted.
6.2. Organizational Changes. In the event a merger, consolidation,
reorganization, or other change in corporate structure materially changes the
terms or value of the common stock of the Company, the number of shares granted
pursuant to Article 4 above shall be adjusted in such manner as the Board of
Directors in its sole discretion shall determine to be equitable and consistent
with the purposes of the Program. Such determination shall be conclusive for all
purposes with respect to the grant made in Article 4 above.
7. Listing, Registration, and Legal Compliance. Each award made
pursuant to Article 4 above shall be subject to the requirement that if at any
time counsel to the Company shall determine that the listing, registration or
qualification thereof or of any shares of the stock subject thereto upon any
securities exchange or under any foreign, federal or state securities or other
law or regulation, or the consent or approval of any governmental body or the
taking of any other action to comply with or otherwise with respect to any such
law or regulation, is necessary or desirable as a condition to or in connection
with such award or delivery of shares of the Stock thereunder, no such award may
be made or implemented unless such listing, registration, qualification,
consent, approval or other action shall have been effected or obtained free of
any conditions not acceptable to the Company. The holder of any such award shall
supply the Company with such certificates, representations and information as
the Company shall request and shall otherwise cooperate with the Company in
effecting or obtaining such listing, registration, qualification, consent,
approval or other action.
8. Obligation to Reelect. Nothing in this Program shall be deemed to
create any obligation on the part of the Board of Directors to nominate any
Director for reelection by the Company's shareholders.
9. Termination or Amendment of the Program. The Board of Directors
reserves the right to terminate or amend the Program at any time; provided,
however, that such action shall not adversely affect the rights of any
Participant under its provisions with respect to awards of the Stock theretofore
made, and provided further that such action shall not increase the amount of
authorized and unissued shares of the Stock available for the program as
specified in Article 3 above or materially increase the benefits to
Participants.
10. Effective Date. This program shall become effective as of the date
that it is ratified by the stockholders and no award made hereunder shall be
effective unless the Program is so ratified.
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