Exhibit 10.12
Amended by the Board of Directors August 26, 2002
1990 STOCK PLAN
OF
PHILLIPS PETROLEUM COMPANY
(As Approved April 25, 1989)
1. PURPOSE
The purpose of the 1990 Stock Plan of Phillips Petroleum Company is to
provide incentive earnings opportunities to those key employees whose
decisions and actions most directly affect the profitability and growth of
the Company and its subsidiaries. Since the incentive earnings
opportunities under this Plan are based on the market value of the
Company's Common Stock, it will have the additional effect of increasing
these employees' identity of interest with that of the Company's
stockholders. There are two programs permitted by this Plan; a Stock
Option Plan and the Strategic Incentive Plan.
2. DEFINITIONS
a) "Board" shall mean the Board of Directors of the Company.
b) "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
c) "Company" shall mean ConocoPhillips.
d) "Committee" shall mean the Compensation Committee of the Board of
Directors as appointed from time to time, and consisting of not less
than three Board members. Each member of the Committee shall be a
"disinterested person" as that term is now or hereafter defined in
Rule 16(b)(3) of the Securities and Exchange Commission.
e) "Earned Award" shall mean the award which an SIP Participant is
entitled to receive under the Strategic Incentive Plan.
f) "Employee" shall mean any person employed by the Company or a
Subsidiary on a full-time salaried basis, including officers and
employee directors thereof.
g) "Fair Market Value" shall mean the average of the highest price and
the lowest price at which Stock shall have been sold on the date of
the grant of the Option as reflected on the consolidated tape of New
York Stock Exchange issues. In the event that any Options shall be
granted on a date on which there were no such sales of Stock, the
fair market value of Stock on such date shall be the average of the
highest price and the lowest price at which Stock shall have been
sold on the last trading day preceding the date of grant of such
Option as reflected on the consolidated tape of New York Stock
Exchange issues.
h) "Incentive Stock Option" or "ISO" shall mean an Option which meets
or complies with the terms and conditions set forth in Section 422A
of the Code and Treasury regulations promulgated thereunder.
i) "Indicators of Performance" shall mean the criteria which the
Committee will use at the conclusion of the Performance Period to
evaluate the Company's overall performance as described in Section
9(b) of this Plan.
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j) "Strategic Incentive Plan Participant" or "SIP Participant" shall
mean any eligible Employee who has been so designated by the
Committee.
k) "Option" or "Stock Option" shall mean a right granted under the Plan
to an Optionee to purchase a stated number of shares of Stock at a
stated exercise price.
l) "Optionee" shall mean an employee who has received a Stock Option
granted under the Plan.
m) "Performance Period" shall mean a period established by the
Committee beginning on the first day of a calendar year, of not less
than three consecutive calendar years, at the conclusion of which
settlement will be made with a SIP Participant with respect to his
Earned Award.
n) "Plan" shall mean the 1990 Stock Plan of Phillips Petroleum Company.
o) "Restricted Stock" shall mean Stock which is not transferable except
in accordance with the terms established for such transfer at the
time of its issue in accordance with the plan under which it was
issued.
p) "Stock" shall mean the common stock, including both Restricted and
unrestricted Stock, of the Company.
q) "Stock Appreciation Right" or "SAR" shall mean the right of an
Optionee to exercise an Option granted in accordance with Section 8
of this Plan.
r) "Subsidiary" shall mean any corporation, a majority of the voting
stock of which is beneficially owned, directly or indirectly, by the
Company.
s) "Target Award" shall mean the award, expressed in shares of Stock,
which will be considered an Earned Award, absent any adjustment
thereto for
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individual performance, if the Committee determines pursuant to
Section 9(b) of this Plan that the Company's overall performance was
"competitive."
t) "Total Disability" and "Totally Disabled" shall mean the condition
in which, by reason of bodily injury or disease, an employee is and
will at all times thereafter be wholly prevented from engaging in
any occupation or employment for compensation, profit or gain. All
determinations of Total Disability shall be made by the insurance
company carrying the group life insurance plan of the Company on the
date on which the employee, whether or not eligible for benefits
under such insurance plan, becomes Totally Disabled.
3. ADMINISTRATION
The Committee is authorized, subject to the provisions of the Plan, from
time to time to establish such rules and regulations and to appoint such
agents as it deems appropriate for the proper administration of the Plan,
and to make such determinations under, and such interpretations of, and to
take such steps in connection with the Plan or the Options or Stock
Appreciation Rights or the Strategic Incentive Plan as it deems necessary
or advisable. Each determination, interpretation, or other action made or
taken pursuant to the provision of the Plan by the Committee shall be
final and shall be binding and conclusive for all purposes and upon all
persons. Notwithstanding any provision of the Plan or any Administrative
Procedure adopted thereunder which may be capable of being construed to
the contrary, no discretion concerning the administration of the Plan
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insofar as it relates to persons subject to Section 16 of the Securities
Exchange Act of 1934 shall be afforded to a person who is not a
disinterested person in respect of the Plan.
4. ELIGIBILITY
Only those Employees who, in the sole judgment of the Committee, may have
a significant effect on the profitability and growth of the Company, shall
be eligible to receive Options and Stock Appreciation Rights under this
Plan. Of such Employees, those who are in positions evaluated at grade 35
or higher under the Company's salary administration system are eligible
for participation in the Strategic Incentive Plan; provided, however, the
Committee may also permit Employees eligible for Participation in the Plan
evaluated at less than grade 35 to participate in the Strategic Incentive
Plan if in the opinion of the Committee such Employees have a significant
effect on the Company's long term growth and profitability.
5. MAXIMUM SHARES AVAILABLE
The Stock to be distributed under the Plan may be either authorized and
unissued shares or issued shares whether held in the treasury of the
Company or otherwise. The total amount of Stock which, under the
provisions of this Plan, may be subject to delivery on the exercise of
Options, issued in satisfaction of exercised Options or SAR's, or issued
under the Strategic Incentive Plan shall not exceed 8.6 million shares of
the Company's Stock, which represents approximately 3.5% of the number of
issued and outstanding shares of Stock as of December 31, 1988. The
maximum number of shares is subject to adjustment in accordance with the
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provisions of Section 10 hereof. In determining the number of shares
subject to delivery under this Plan, those represented by cancelled
Options, forfeited Options, expired Options and non-earned awards under
the Strategic Incentive Plan shall be returned upon the occurrence of such
event to the pool of shares available for distribution under the Plan and
may be the subject of further Options or SAR's, or may be issued under the
Strategic Incentive Plan.
6. STOCK OPTIONS
a) Award of Options. (i) The Committee, at any time and from time to
time prior to December 31, 1994, may grant Options under the Plan to
eligible Employees, for such numbers of shares and having such terms
as the Committee shall designate, subject, however, to the
provisions of the Plan. The Committee will also determine the type
of Option granted (e.g., ISO, nonstatutory, other statutory Options
as from time to time may be permitted by the Code) or a combination
of various types of Options. Options designated as ISO's shall
comply with all the provisions of Section 422A(b) of the Code and
applicable Treasury Department regulations. The aggregate Fair
Market Value (determined at the time the Option is granted) of Stock
with respect to which ISO's are exercisable for the first time by
any individual during a calendar year under all plans of the
Company, and any subsidiary shall not exceed $100,000. All shares
over the $100,000 first exercisable value shall be granted as a
non-qualified Option. The date on which an Option shall be granted
shall be the date of the Committee's authorization of such grant.
Any individual at
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any one time and from time to time may hold more than one Option
granted under the Plan or under any other Stock plan of the Company.
(ii) Each Option shall be evidenced by a Stock Option Agreement in
such form and containing such provisions not inconsistent with the
provisions of the Plan as the Committee from time to time shall
approve.
b) Exercise Price. The price at which shares of Stock may be purchased
under an Option shall not be less than 100 percent of the Fair
Market Value of the Stock on the date the Option is granted.
c) Term of Options. 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 for those Options designated as ISO's or 11 years for
other types of Options. The date or dates on which installment
portion(s) of an Option may be exercised during the term of an
Option shall be determined by the Committee and may vary from Option
to Option. If the Committee makes no such specific arrangement with
respect to an Option, each such Option granted pursuant to the Plan
shall become exercisable in four installments. The first such
installment shall become exercisable on the first anniversary of the
date of the grant for 25 percent of the number of shares of Stock
subject to the Option. Thereafter, on each anniversary of the date
of the grant an installment shall become exercisable for an
additional 25 percent of the number of shares of Stock subject to
the Option until the Option shall have become fully exercisable. To
the extent that an installment is
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not exercised when it becomes exercisable, it shall not expire but
shall continue to be exercisable at any time thereafter until the
Option shall be cancelled, expire or be surrendered. The Committee
may accelerate the exercise schedule on outstanding Options, if in
its sole judgment conditions are such to warrant such acceleration.
d) Termination of Employment. (i) If, prior to a date one year from the
date an Option shall have been granted, the Optionee's employment
with the Company or Subsidiary shall be terminated for any reason,
such Option shall be cancelled and all rights thereunder shall
cease; provided that an Option granted in any year to an Optionee
who terminates employment on January 1 of the following year due to
retirement pursuant to the terms of a retirement plan of the Company
or a Subsidiary shall not be cancelled for that reason, and
provided, further, the Committee may, in its sole discretion
determine that all or any portion of any other Option shall not be
cancelled due to termination of employment prior to a date one year
from the date the Option shall have been granted.
(ii) If, on or after one year from the date an Option shall have
been granted, an Optionee's employment with the Company or
Subsidiary is terminated for any reason except retirement pursuant
to the terms of a retirement plan of the Company or a Subsidiary,
Total Disability, or death, any Option so granted under the Plan
shall be cancelled on such termination; provided, that the Committee
may, in its sole discretion, determine that all or a portion of any
such Option shall not be cancelled.
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(iii) If, on or after a date one year from the date the Option is
granted, an Optionee shall terminate employment by reason of
retirement pursuant to a retirement plan of the Company or
Subsidiary, or by reason of Total Disability, the Optionee shall
retain all rights provided by the Option at the time of such
termination of employment. If on or after a date one year from the
date the Option is granted, or such shorter period as may be
permitted pursuant to (d)(ii) above, an Optionee shall die while in
the employ of the Company or Subsidiary or after termination of
employment by reason of retirement pursuant to a retirement plan of
the Company or Subsidiary, the executor or administrator of the
estate of the Optionee or the person or persons to whom the Option
shall have been validly transferred by the executor or the
administrator pursuant to will or the laws of descent and
distribution shall have the right to exercise the Option to the same
extent the Optionee could have, had the Optionee not died. No
transfer of an Option by the Optionee by will or by the laws of
descent and distribution shall be effective to bind the Company
unless the Company shall have been furnished with written notice
thereof and a copy of the will and such other evidence as the
Company may deem necessary to establish the validity of the transfer
and the acceptance by the transferee or transferees of the terms and
conditions of such Option.
(iv) Transfer of employment between the Company and a Subsidiary or
between Subsidiaries shall not constitute termination of employment
for the purpose of any Option granted under the Plan. Whether any
leave of
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absence shall constitute termination of employment for the purposes
of any Option granted under the Plan shall be determined in each
case by the Committee in its sole discretion.
e) Payment for Shares. (i) The exercise price for all shares of Stock
purchased upon the exercise of an Option, or a portion thereof,
shall be paid in full at the time of such exercise. Such payment may
be made in cash, by tendering shares of Stock having a value on the
date of exercise equal to the exercise price, or tendering shares of
Restricted Stock having a value on the date of exercise equal to the
exercise price. Such value shall be the Fair Market Value except
that the applicable date for determination of the highest and lowest
price on the New York Stock Exchange shall be the date on which the
Option is exercised, or if not a trading date, then the last trading
day on such Exchange preceding the date on which the Option is
exercised. If Restricted Stock is used in such exercise, the
resulting new shares shall have the same restrictions as the
tendered shares. The number of shares so restricted shall not be
less than the number of shares of Restricted Stock tendered. The
Committee may, in its sole discretion and judgment, limit the extent
to which shares of Stock or shares of Restricted Stock may be used
in exercising Options.
(ii) The Stock delivered to the Optionee upon exercise of an Option,
whether or not Restricted Stock is used for payment of the purchase
price of the Option may, at the discretion of the Committee, have
restrictions
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placed on it, provided that the Stock Option Agreement with the
Optionee covering the Option permits such use of Restricted Stock.
f) Should a withholding tax obligation arise upon the exercise of an
Option, the withholding tax may be satisfied by withholding shares
of Stock or by payment of cash.
7. DETRIMENTAL ACTIVITIES
If the Committee determines that, subsequent to the grant of any Option,
the Optionee has engaged or is engaging in any activity which, in the sole
judgment of the Committee, is or may be detrimental to the Company or a
Subsidiary, the Committee may refuse to honor the exercise of such
Optionee's Options already requested, and cancel the Option or Options
granted to that Optionee.
8. STOCK APPRECIATION RIGHTS
a) Grant. The Committee may, at its discretion, affix Stock
Appreciation Rights to any Option, either at the time of its initial
granting to the Optionee or at a later date. The addition of such
SAR's must be accomplished prior to the completion of the period
during which the Option may be exercised and such exercise period
may not be extended beyond that which was initially established. The
Committee may establish any SAR terms and conditions that it desires
at the time such SAR is established, provided that, to the extent
permitted by applicable law, notwithstanding any provision of this
Plan to the contrary, the terms and conditions of a SAR related to
an ISO shall be the same as the terms applicable to the underlying
ISO.
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b) Exercise of Stock Appreciation Right. (i) A Stock Appreciation Right
shall be exercisable at such time as may be determined by the
Committee, which shall be not less than six months after its grant,
and provided further that a Stock Appreciation Right shall be
exercisable only to the extent that the related Option could be
exercised. Option shares with respect to which the related Stock
Appreciation Right shall have been exercised may not again be
subjected to Options under this Plan. Upon the exercise of a Stock
Appreciation Right, that portion of the Option underlying the Stock
Appreciation Right will be considered as having been exercised.
(ii) The Committee may impose any other conditions upon the exercise
of a Stock Appreciation Right, which conditions may include a
condition that the Stock Appreciation Right may only be exercised in
accordance with rules and regulations adopted by the Committee from
time to time. Such rules and regulations may govern the right to
exercise Stock Appreciation Rights granted prior to the adoption or
amendment of such rules and regulations as well as Stock
Appreciation Rights granted thereafter. The exercise of a Stock
Appreciation Right for cash shall be made only during the periods
specified in Rule 16b-3 of the Securities and Exchange Commission.
(iii) Upon the exercise of a Stock Appreciation Right, the Company
shall give to an Optionee an amount (less any applicable withholding
taxes, which at the Company's discretion may be settled by
withholding shares of Stock or by payment of cash) equivalent to the
excess of the value of
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the shares of Stock for which the right is exercised on the date of
such exercise over the exercise price of such shares under the
related Option. The value on the date of exercise shall be the Fair
Market Value as determined in Section 6(e) of this Plan. Such amount
shall be either in cash or in shares of Stock or both as the
Committee shall determine. Such determination may be made at the
time of the granting of the Stock Appreciation Right and may be
changed at any time thereafter. The shares may consist either in
whole or in part of authorized and unissued shares of Stock or
issued shares of Stock whether held in the treasury of the Company
or otherwise. No fractional shares of Stock shall be issued and the
Committee shall determine whether cash shall be given in lieu of
such fractional share or whether such fractional share shall be
eliminated.
c) Expiration or Termination of Stock Appreciation Rights.
(i) Subject to (c)(ii), each Stock Appreciation Right and all rights
and obligations thereunder shall expire on a date to be determined
by the Committee.
(ii) A Stock Appreciation Right shall terminate and may no longer be
exercised upon the termination of the related Option
d) Amendment, Suspension or Termination of Stock Appreciation Rights. The
Committee may, at any time, amend, suspend, or terminate any Stock
Appreciation Right theretofore granted under the Plan.
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9. STRATEGIC INCENTIVE PLAN
a) Administrative Procedure. Normally, the Committee shall adopt
administrative procedures applicable to a Performance Period prior
to, or within 30 days after, the date designated by the Committee
for the Commencement of such Performance Period. The Committee may,
however, adopt such administrative procedures more than 30 days
after such commencement if in its option such delayed action is
appropriate. Such procedures shall establish Indicators of
Performance and the Target Awards applicable to the Performance
Period. Indicators of Performance may vary from Performance Period
to Performance Period.
b) Indicators of Performance. Indicators of Performance may include,
but shall not be limited to, increased shareholder value, earnings
per share, return on shareholder's equity, return on assets and/or
other similar criteria. Such indicators may be based on the
Company's performance compared to the performance of one or more
selected companies in the petroleum industry during the same
Performance Period or may relate solely to the Company's performance
during the Performance Period or a combination of such indicators.
At the completion of the Performance Period, the Committee will
review the Company's actual performance with respect to the
Indicators of Performance, and, in its sole judgment, rank the
Company's overall performance. Such ranking may range from
"noncompetitive" through "competitive" to "outstanding." In arriving
at such ranking, the Committee may take into consideration, and make
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appropriate adjustments for, events occurring during the Performance
Period, which the Committee, in its sole judgment, concludes have
affected the performance of the Company or any selected company with
respect to any of the Indicators of Performance. No Earned Awards
will be granted if the Company's overall performance is ranked
"non-competitive." Subject to individual performance adjustments
therein, if any, pursuant to paragraph 9(c) of this Plan, if the
Company's overall performance is ranked "competitive," Target Awards
will result; higher or lower ranking will result in greater or
lesser awards provided that in no event, including individual
performance adjustments, shall the Earned Award of a SIP Participant
exceed 150% of the SIP Participant's Target Award.
c) Award Adjustments. The Committee in its sole discretion may make
adjustments in awards determined under paragraph (b) of this Section
based on the SIP Participant's individual performance during the
Performance Period. The administrative procedures for each
Performance Period shall establish the method to be used by the
Committee in determining which, if any, SIP Participants may receive
such performance adjustments and, subject to the maximum set out in
paragraph (b) of this Section, the size of such adjustments.
d) Partial Performance Period Participation. The administrative
procedures adopted for each Performance Period shall also include
procedures to be used in determining the extent to which an Employee
shall participate in a
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partial Performance Period due to either assignment to a position
which makes the Employee eligible to be a SIP Participant after the
beginning of such Performance Period or termination of employment
prior to the completion of such a Performance Period in which the
Employee was a SIP Participant.
e) Award Settlement. With respect to each Performance Period,
settlement of all Earned Awards shall be made in Stock as soon as
practicable following the date on which the Committee determines the
size of Earned Awards; provided that the Committee may decide to
settle such awards over a period or periods of time as the Committee
shall deem appropriate.
10. ADJUSTMENT UPON CHANGES IN CAPITALIZATION
In the event of a reorganization, recapitalization, Stock split, Stock
dividend, exchange of Stock, combination of Stock, merger, consolidation
or any other change in corporate structure of the Company affecting the
Stock, or in the event of a sale by the Company of all or a significant
part of its assets, or any distribution to its shareholders other than a
normal cash dividend, the Committee may make appropriate adjustment in the
number, kind, price and value of Stock authorized by this Plan and any
adjustment to outstanding Awards as it determines appropriate so as to
prevent dilution or enlargement of rights.
11. MISCELLANEOUS
a) Except as otherwise required by law, no action taken under the Plan
shall be taken into account in determining any benefits under any
pension, retirement, thrift, profit sharing, group insurance, or
other benefit plan
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maintained by the Company or any Subsidiary, unless such other plan
specifically provides for such inclusion.
b) No Option or Stock Appreciation Right or right under the Strategic
Incentive Plan shall be transferable other than by will or the laws
of descent and distribution. During the lifetime of an Optionee, any
Option or Stock Appreciation Right shall be exercisable only by the
Optionee or the Optionee's duly appointed guardian or legal
representative.
c) The Company shall have the right to withhold from any settlement
hereunder any Federal, state, or local taxes required by law to be
withheld. Such withholding may be satisfied by the withholding of
shares of Stock by the Company if the Optionee so requests in a
manner prescribed by the Committee, if the Committee so approves,
and such withholding of shares does not violate any applicable laws,
rules or regulations of Federal, state or local authorities.
d) All administrative expenses associated with the administration of
the Plan shall be borne by the Company.
e) Masculine pronouns and other words of masculine gender used herein
shall refer to both men and women.
f) The titles and headings of the sections in this Plan are for
convenience of reference only and in the event of any conflict, the
text of the Plan, rather than such titles or headings, shall
control.
12. AMENDMENT AND TERMINATION
The Board may, at any time, terminate or amend this Plan in such respect
as it
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shall deem advisable, provided, the Board may not, without further
approval of the stockholders of the Company if such approval is required
in order that transactions in Company securities under the Plan be exempt
from the operation of Section 16(b) of the Securities Exchange Act of
1934, amend the Plan so as to (i) increase the number of shares of Stock
which may be issued under the Plan, except as provided for in Section 10;
(ii) materially modify the requirements as to eligibility for
participation; (iii) materially increase the benefits accruing to
Participants under the Plan; (iv) extend the duration of the Plan beyond
the date approved by the stockholders; or (v) increase the maximum dollar
amount of ISO's which an individual Optionee may first exercise during any
calendar year beyond that permitted in the Code and applicable regulations
of the Treasury Department. Notwithstanding the foregoing, no such
termination or amendment may adversely affect the rights of any
Participant under any Award that is outstanding at the time of such
termination or amendment without the Participant's consent.
13. DURATION OF THE PLAN
The Plan shall become effective on January 1, 1990, provided that it has
been approved by the stockholders at the annual meeting of the
stockholders in April of 1989, and shall terminate on December 31, 1994.
14. CHANGE OF CONTROL
a) In the event of a Change of Control:
i) Any Stock Options and Stock Appreciation Rights outstanding as
of the date of the Change of Control that are not then fully
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exercisable and vested, shall become fully exercisable and
vested to the full extent of the original grant;
ii) All restrictions and other limitations applicable to any
Restricted Stock shall lapse, and such Restricted Stock shall
become free of all restrictions and become fully vested and
transferable to the full extent of the original grant;
iii) All Performance Awards and other Awards outstanding as of the
date of the Change of Control shall be considered to be earned
and payable in full, and any deferral or other restriction
shall lapse and except as provided in subsection (c) of this
Section 14, such Performance Units shall be settled in cash as
promptly as is practicable; and
iv) All noncompetition covenants and other similar restrictive
covenants applicable to any outstanding Awards shall lapse and
become null and void and of no further effect.
b) A "Change of Control" shall mean:
i) The acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934 as amended (a "Person")) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under
the Securities Exchange Act of 1934) of 20% or more of either
(a) the then outstanding shares of common stock of the Company
(the "Outstanding Company Common Stock") or (b) the combined
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voting power of the then outstanding voting securities of the
Company entitled to vote generally in the election of
directors (the "Outstanding Company Voting Securities");
provided, however, that for the purposes of this subsection
(i), the following acquisitions shall not constitute a Change
of Control: (A) any acquisition directly from the Company, (B)
any acquisition by the Company, (C) any acquisition by any
employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the
Company or (D) any acquisition pursuant to a transaction which
complies with clauses (A), (B) and (C) of subsection (iii) of
this Section 14(b); or
ii) Individuals who, as of August 26, 2002, constitute the Board
(the "Incumbent Board") cease for any reason to constitute at
least a majority of the Board; provided, however, that any
individual becoming a director subsequent to August 26, 2002,
whose election, or nomination for election by the Company's
shareholders, was approved by a vote of at least a majority of
the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the
Incumbent Board, but excluding, for this purpose, any such
individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with
respect to the election or removal of directors
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or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board; or
iii) Approval by the shareholders of the Company of a
reorganization, merger or consolidation or sale or other
disposition of all or substantially all of the assets of the
Company or the acquisition of assets of another entity (a
"Corporate Transaction"), in each case, unless, following such
Corporate Transaction, (A) all or substantially all of the
individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Stock and
Outstanding Company Voting Securities immediately prior to
such Corporate Transaction beneficially own, directly or
indirectly, more than 60% of, respectively, the then
outstanding shares of common stock and the combined voting
power of the then outstanding voting securities entitled to
vote generally in the election of directors, as the case may
be, of the corporation resulting from such Corporate
Transaction (including, without limitation, a corporation
which as a result of such transaction owns the Company or all
or substantially all of the Company's assets either directly
or through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such
Corporate Transaction of the Outstanding Company Common Stock
and Outstanding Company Voting Securities, as the case may be,
(B) no Person (excluding
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any employee benefit plan (or related trust) of the Company or
such corporation resulting from such Corporate Transaction)
beneficially own, directly or indirectly, 20% or more of,
respectively, the then outstanding shares of common stock of
the corporation resulting from such Corporate Transaction or
the combined voting power of the then outstanding voting
securities of such corporation except to the extent that such
ownership existed prior to the Corporate Transaction and (C)
at least a majority of the members of the board of directors
of the corporation resulting from such Corporate Transaction
were members of the Incumbent Board at the time of the
execution of the initial agreement, or of the action of the
Board, providing for such Corporate Transaction; or
iv) Approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company.
c) Notwithstanding the foregoing, if any right to receive cash granted
pursuant to this Section 14 would make a Change of Control
transaction ineligible for pooling-of-interests accounting under APB
No. 16 that but for the nature of such right would be eligible for
such accounting treatment, the Committee shall have the ability to
substitute for the cash payable pursuant to such right Stock or
other securities with a fair market value equal to the cash that
would otherwise be payable hereunder.
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