Exhibit (10)-4
Commonwealth Edison Company
Form 10-K/A-1 File No. 1-1839
COMMONWEALTH EDISON COMPANY
1994 LONG-TERM PERFORMANCE UNIT AWARD
FOR EXECUTIVE AND GROUP LEVEL EMPLOYES
PAYABLE IN 1996
UNDER THE
1993 LONG-TERM INCENTIVE PLAN
Commonwealth Edison Company, an Illinois corporation (the "Company"),
hereby grants to each employe described in Section 1 hereof as of January 25,
1994 (the "Grant Date"), in accordance with the provisions of the Commonwealth
Edison Company 1993 Long-Term Incentive Plan (the "Plan"), a performance unit
award (each, an "Award") expressed as a number (the "Base Unit") of performance
units, in the amount and upon and subject to the restrictions, terms and
conditions set forth below. Capitalized terms not defined herein shall have the
meanings specified in the Plan.
1. Recipients of Awards. Recipients of Awards hereunder shall consist of
the following employes (each, an "Existing Employe") of the Company and of
Commonwealth Edison Company of Indiana, Inc.: (i) each Group Level employe on
the Grant Date, (ii) each Executive on the Grant Date and (iii) each Officer on
the Grant Date, including, without limitation, the Chairman of the Company, the
President of the Company and each Senior Vice President of the Company;
provided, however, that individuals who become Group Level employes, Executives
or Officers after the Grant Date but prior to January 13, 1995 and who were not
previously Group Level employes, Executives or Officers (each, a "New Employe"),
shall be eligible to receive an Award hereunder. The term "Employe" shall mean
either an Existing Employe or a New Employe.
2. Base Unit. The Base Unit for each Award shall be a number (rounded to
the nearest whole number) equal to (a) the product of multiplying (i) the Salary
(as defined herein) of the Employe receiving such Award by (ii) the applicable
percentage set forth below, divided by (b) $27:
Chairman: 25%
President: 25%
Senior Vice Presidents: 20%
Officers, other than as listed above: 15%
Executives, other than as listed above: 10%
Group Level employes, other than as listed above: 10%
For the purposes of calculating the Base Unit, an Existing Employe's Salary
shall be such Existing Employe's monthly scheduled rate of pay as of the Grant
Date multiplied by 12 together with the
income from such Existing Employe's Deferred Compensation Units, and a New
Employe's Salary shall be such New Employe's monthly scheduled rate of pay as of
the date such New Employe becomes a New Employe (the "Start Date") multiplied by
12 together with the income from such New Employe's Deferred Compensation Units.
3. Performance Period. The Performance Period shall commence on January
25, 1994 and end on December 31, 1995.
4. Payment Amount/Stockholder Protection. The amount payable in
connection with an Award (a "Payment Amount") shall be a dollar amount based on
the Base Unit and on the Company's percentile rank, with the percentile rank
corresponding to the highest performance in the performance group being 100 and
the percentile rank corresponding to the lowest performance in the performance
group being 1 (the "Company Rank"), in the Ranking (as hereinafter defined) for
the Performance Period, and calculated as follows:
Below Threshold Level. If the Company Rank is lower than the 25th
percentile in the Ranking, then the Payment Amount shall be zero.
Between Threshold Level and Target Level. If the Company Rank is no
lower than the 25th percentile in the Ranking and no higher than the 49th
percentile in the Ranking, then the Payment Amount shall be the Base Value
multiplied by a fraction the numerator of which is the Company Rank
multiplied by 2 and the denominator of which is 100.
Between Target Level and Maximum Level. If the Company Rank is no
lower than the 50th percentile in the Ranking and no higher than the 90th
percentile in the Ranking, then the Payment Amount shall be the Base Value
multiplied by a fraction the numerator of which is the Company Rank
multiplied by 2.5 minus 25 and the denominator of which is 100.
Above Maximum Level. If the Company Rank is above the 90th percentile
in the Ranking, then the Payment Amount shall be the Base Value multiplied
by 2.
Notwithstanding the foregoing, if the Company (or, if the Company
becomes a majority owned subsidiary of another corporation, then such parent
corporation) fails to maintain regular quarterly cash dividends of at least $.40
per share of Common Stock during the Performance Period (adjusted for any stock-
split, stock dividend or other similar event), then the Payment Amount shall be
zero.
For purposes of the foregoing, the term "Ranking" shall mean a ranking
determined based upon the Cumulative Total Shareholder Return (as hereinafter
defined) for such Performance Period on the Company's (or, if the Company
becomes a majority owned subsidiary of another corporation, then such parent
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corporation's) Common Stock as compared to the Cumulative Total Shareholder
Return for such Performance Period on the common stock of each corporation
comprising the Dow Jones Utility Index (or any successor index); the term
"Cumulative Total Shareholder Return" for a period shall mean the result
obtained by dividing (i) the sum of (a) the cumulative amount of dividends on
the common stock in question for such period, assuming reinvestment of said
dividends in said common stock, and (b) the difference between the price per
share of said common stock at the end and the beginning of such period, by (ii)
the price per share of said common stock at the beginning of such period; and
the term "Base Value" shall mean the result obtained by multiplying the Base
Unit by the value of a share of Common Stock (as determined under Section 5
hereof).
5. Settlement of Awards. The Payment Amount shall become payable
upon the completion of the Performance Period and shall be paid by the Company
within 90 days after the completion of the Performance Period. The Payment
Amount shall be paid 50% in cash and 50% in shares of Common Stock. Fractional
shares of Common Stock that may become payable hereunder shall be paid in cash.
For the purposes of determining the number of shares of Common Stock payable
pursuant to this Section, a share of Common Stock shall be valued at the average
of the closing prices of a share of Common Stock as reported in The Wall Street
Journal as New York Stock Exchange Composite Transactions during the calendar
quarter ending on the last day of the Performance Period (appropriately adjusted
for any stock-split, stock dividend or other similar event).
6. Employment for Less Than Full Performance Period. If an Employe's
employment with the Company is terminated prior to the completion of the
Performance Period for any reason other than as provided in the immediately
following sentence, then no amount shall be payable hereunder. If (i) an
Existing Employe's employment with the Company is terminated after January 13,
1995 but prior to the completion of the Performance Period due to such Existing
Employe's (a) retirement under the pension plan of the Company or (b) death, or
(ii) a New Employe's employment with the Company is terminated more than 353
days after such New Employe's Start Date but prior to the completion of the
Performance Period due to such New Employe's (x) retirement under the pension
plan of the Company or (y) death, then such Employe shall be entitled to an
amount equal to the Payment Amount calculated in accordance with Section 4
hereof multiplied by a fraction the numerator of which is the number of days in
the Performance Period that have elapsed between the commencement of the
Performance Period (in the case of an Existing Employe), or the Start Date (in
the case of a New Employe), and the date of such retirement or death (as the
case may be) and the denominator of which is the number of days in the
Performance Period. The Payment Amount for any New Employe whose employment is
not terminated prior to the completion of the Performance Period shall be
calculated in accordance with Section 4 hereof and be reduced by multiplying it
by a fraction the numerator of which is the number of days in the Performance
Period
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that have elapsed between such New Employe's Start Date and the end of the
Performance Period and the denominator of which is the number of days in the
Performance Period. Any Payment Amount calculated in accordance with either of
the two immediately preceding sentences shall be paid as provided in Section 5
hereof within 90 days after the completion of the Performance Period. As used
in this Section 6, employment by the Company shall include employment by a
corporation which is a "subsidiary corporation" of the Company (or, if the
Company becomes a majority owned subsidiary of another corporation, then such
parent corporation), as such term is defined in section 424 (and any successor
section) of the Internal Revenue Code of 1986, as amended, or any successor
internal revenue law.
7. Rights as a Stockholder. No Employe shall have any rights as a
stockholder of the Company with respect to any shares of Common Stock that may
be payable hereunder unless and until such shares have been issued to such
Employe or otherwise credited to an account for the benefit of such Employe.
8. Additional Terms and Conditions of Award.
8.1. Nontransferability of Award. In accordance with Section 13.5 of
the Plan, no Award or other related benefit may, except as otherwise
specifically provided by the Plan or by law, be transferable in any manner other
than by will or the laws of descent and distribution, and any attempt to
transfer any such Award or other benefit shall be void; provided, however, that
the foregoing shall not restrict the ability of any Employe to transfer any cash
or Common Stock received as part of the Payment Amount. In accordance with
Section 13.5 of the Plan, Awards or other benefits payable under Awards shall
not in any manner be subject to the debts, contracts, liabilities, engagements
or torts of any person who shall be entitled to such Award or benefits, nor
shall they be subject to attachment or legal process for or against such person.
8.2. Withholding Taxes. As a condition precedent to the delivery to
the Employe of cash or Common Stock hereunder and in accordance with Section
13.4 of the Plan, the Company may deduct from any amount (including any Payment
Amount) payable then or thereafter payable by the Company to the Employe, or
may request the Employe to pay to the Company in cash, such amount as the
Company may be required, under all applicable federal, state, local or other
laws or regulations, to withhold and pay over with respect to the Award.
8.3. Compliance with Applicable Law. Each Award is subject to the
condition that if the listing, registration or qualification of the shares of
Common Stock subject to the Award upon any securities exchange or under any law,
or the consent or approval of any governmental body, or the taking of any other
action is necessary or desirable as a condition of, or in connection with, the
vesting or delivery of such shares hereunder,
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such shares may not be delivered, in whole or in part, unless such listing,
registration, qualification, consent or approval shall have been effected or
obtained.
8.4. Award Subject to the Plan. This Award is subject to the
provisions of the Plan, and shall be interpreted in accordance therewith.
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