EXHIBIT 10.3
CONFORMED COPY
WESTLAKE GROUP
PERFORMANCE UNIT PLAN
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EFFECTIVE JANUARY 1, 1991
CONFIDENTIAL
WESTLAKE GROUP
PERFORMANCE UNIT PLAN
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EFFECTIVE JANUARY 1, 1991
1.0 PURPOSE
1.1 The objective of the Westlake Group Performance Unit Plan (The
Plan) is to reward selected Key Employees with a piece of the
future of the Company whose value the Key Employees help to
enhance.
1.2 The Plan is designed to provide selected Key Employees with a
sense of ownership in the Company and an opportunity to
benefit from the increase in the value of the Company and thus
to aid in attracting and retaining Key Employees.
2.0 ADMINISTRATION
2.1 The Chairman's Office (CO) shall have total and complete
discretion to determine who receives Performance Units (PUs);
the amount and value of PUs; and the time of issuance of PUs.
2.2 No decision by CO shall be considered an ongoing rule or
regulation unless so expressly stated by CO.
2.3 Decisions and determinations of CO shall be final and binding
on all parties.
3.0 VALUATION OF PUs
3.1 PU will be assigned a base value of $1.00.
3.2 PU will entitle Key Employee (when eligible to exercise) to a
payment measured as follows:
<Table>
Book Value at Exercise Valuation Date -- Book Value at Grant Date
Cash Value = ----------------------------------------------------------------- x $1.00 x # of Vested Units
Book Value at Grant Date
</Table>
3.3 Book Value to be defined by CO and determined on an annual
basis and shall exclude any new infusions of capital or
increases in capital through any mergers with any other
company during the period between the grant date and the date
of exercise.
3.4 Each new grant will be based upon the book value as of the
date of the new grant.
3.5 At the discretion of the CO, a dividend may be withdrawn at
any time which may reduce the original book value base for any
grant year. To maintain the same growth ratio as if the
dividend had been left in the business, the following ratio
will be applied to the book value at the exercise date. In the
event of multiple dividend withdrawals during the life of the
grant, this ratio will be applied each time so that the rate
of growth that otherwise may have occurred without the
withdrawals will remain the same.
Ratio (R) = Book Value Before Dividend Withdrawal (W/D)
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Book Value Before W/D -- W/D Amount
4.0 EXERCISE OF PU RIGHTS
4.1 Vested PUs can only be converted to cash during April of each
calendar year.
4.2 Conversion of PUs to cash extinguishes all rights associated
with such converted PUs.
4.3 Upon an initial public offering of stock in any Westlake
companies, a participant will be allowed to convert the value
of unexercised PUs into common stock on a basis more favorable
than the public offering price as determined by CO.
5.0 VESTING & AWARD CONDITIONS
5.1 50% of PUs awarded in each grant shall be vested 2 years after
the date of award (vesting date) if the employee is still
employed by Westlake at such time. Vested PUs are exercisable
in any April following the vesting date.
5.2 Remaining 50% of PUs awarded in each grant shall be vested 7
years after date of award if employee is still employed by
Westlake at such time. Vested PUs are exercisable in any April
following the vesting date.
5.3 Key employees awarded PUs under the 1990 grant of the plan
shall be vested in 50% of PUs after 1 year from the date of
award and 50% after 6 years. All subsequent grants will follow
the vesting schedule above.
5.4 If employment of participant terminates other than for death,
disability, or normal retirement, participant may only
exercise any vested PUs during the next exercise period.
Failure to exercise during the next exercise period will
result in the forfeiture of vested PUs.
5.5 All non-vested PUs held at termination of employment except in
the case of death or disability or normal retirement shall be
forfeited.
5.6 Upon total and permanent disability as determined by CO or
upon death or normal retirement of a participant, all PUs
become vested immediately and shall be automatically exercised
during the next exercise period. In the case of death, the
proceeds will be distributed to the participant's designated
beneficiary.
5.7 All PUs must be exercised within 10 years of award pursuant to
IRS guidelines.
6.0 CHANGE OF OWNERSHIP
6.1 In case of more than a 50% change in ownership of the stock or
underlying assets of Westlake, a provision in the plan as
determined by the CO will protect the rights of participants
in previously granted awards, or the plan may be terminated
with all outstanding vested units becoming eligible for
exercise at a date as determined by CO.
7.0 LIMITATION OF LIABILITIES
7.1 CO reserves the right at any time to amend or terminate the PU
Plan; but such action shall not adversely affect any plan
participant (or beneficiary) with respect to vested PUs
previously awarded and then any outstanding units at such
termination will become exercisable at a date as determined by
CO.
7.2 CO and Westlake Group of Companies shall not be liable to plan
participants or beneficiaries for any decision, action or lack
of action taken in connection with the PU Plan.
7.3 The Plan shall not establish any right on the part of
employees to receive PUs except as solely determined by CO.
7.4 The Plan shall not give any employee or any other persons any
rights or interest in any specific asset or assets of a
Westlake Company.
7.5 The Plan shall not in any way be evidence of any agreement or
understanding, express or implied, that a Westlake Company
will employ a plan participant in any particular position or
at any specific rate of pay.
8.0 TAX CONSIDERATIONS
8.1 Company is not allowed a current deduction for awards of PUs
based upon current IRS guidelines.
8.2 Employees have no taxable income until PUs are exercised or
deemed exercised at date of expiration.
8.3 Company gets a tax deduction for its taxable year which
includes last day of employee's tax year in which the
employee's payments becomes taxable.
9.0 BENEFICIARY
9.1 Each participant should select a beneficiary to receive
payments payable at the first exercise period following the
Key Employee's death.
APPROVED: /s/ James Chao
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James Chao - President
DATE: 1/24/92
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