Exhibit (10)-11
Unicom Corporation and Commonwealth Edison Company
Form 10-K File Nos. 1-11375 and 1-1839
UNICOM CORPORATION
1997 LONG-TERM PERFORMANCE UNIT AWARD
FOR EXECUTIVE AND GROUP LEVEL EMPLOYEES
PAYABLE IN 2000
UNDER THE
UNICOM CORPORATION LONG-TERM INCENTIVE PLAN
Unicom Corporation, an Illinois corporation (the "Company"),
hereby grants to each employee described in Section 1 hereof as of January 1,
1997 (the "Grant Date"), in accordance with the provisions of the Unicom
Corporation 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 employees (each, an "Existing Employee") of
Commonwealth Edison Company ("ComEd") and of Commonwealth Edison Company of
Indiana, Inc. ("ComEd/Indiana"): (i) each Group Level employee 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 ComEd, the Vice Chairman of
ComEd, the President of ComEd, the Executive Vice President of ComEd and each
Senior Vice President of ComEd; provided, however, that individuals who become
Group Level employees, Executives or Officers after the Grant Date and during
the Performance Period (as hereinafter defined) (each, a "New Employee") shall
be eligible to receive an Award hereunder. In addition, the Committee may, in
its sole and absolute discretion, allow employees of other Subsidiaries ("Other
Employees") of the Company to receive an Award hereunder. The term "Employee"
shall mean an Existing Employee, a New Employee or an Other Employee, as the
case may be.
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 Employee receiving such
Award by (ii) the applicable percentage set forth below, divided by (b) the
closing price of a share of Common Stock as reported in The Wall Street Journal
as New York Stock Exchange Composite Transactions for December 31, 1996:
Chairman: 50%
Vice Chairman: 40%
President: 40%
Executive Vice President: 40%
Senior Vice Presidents: 35%
Officers, other than as listed above: 25%
Executives, other than as listed above: 20%
Group Level employees, other than as listed above: 15%
Other Employees: such percentage as shall be
established by the Committee for the particular Other Employee
For the purposes of calculating the Base Unit, an Existing Employee's Salary
shall be such Existing Employee's monthly scheduled rate of pay as of the Grant
Date multiplied by 12 together with the income from such Existing Employee's
Deferred Compensation Units (whether such Units were granted by the Company or
by ComEd), and a New Employee's Salary shall be such New Employee's monthly
scheduled rate of pay as of the date such New Employee becomes a New Employee
(the "Start Date") multiplied by 12 together with the income from such New
Employee's Deferred Compensation Units (whether such Units were granted by the
Company or by ComEd).
3. Performance Period. The Performance Period shall
commence on January 1, 1997 and end on December 31, 1999.
4. Payment Amount. 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 Minimum Level. If the Company Rank is lower than the
25th percentile in the Ranking, then the Payment Amount shall be zero.
Between Minimum Level and Standard 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 Standard 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
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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.
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 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;
provided, however, that, if the Employee elects under the Unicom Corporation
Stock Bonus Deferral Plan to defer more than 50% of the Payment Amount, the
amount so deferred shall be paid in shares of Common Stock; and provided
further, that shares that may become payable to an Employee hereunder shall not
be issued if the aggregate number of shares payable to such Employee does not
exceed twenty-five (and, in such case, cash shall be paid in an amount equal to
the value of the shares that would have been issued but for this proviso).
Fractional shares of Common Stock that may become payable to an Employee
hereunder shall be issued if the shares issuable to such Employee exceed
twenty-five and are held in non-certificated, book-entry or electronic form;
otherwise, any such fractional shares 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).
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6. Employment as an "Employee" for Less Than Full
Performance Period.
6.1. Termination of Employment. If an Employee'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 an Employee's
employment with the Company is terminated prior to the completion of the
Performance Period due to such Employee's (i) termination as a result of the
sale of ComEd/Indiana's State Line generating plant located in Hammond, Indiana,
the sale of ComEd's Kincaid generating plant located in Kincaid, Illinois, or
ComEd's decision to have a third party provide the services provided by the
functional group that includes such Employee (in any such case, a "Permitted
Termination"), (ii) retirement under the pension plan of any of the Employers or
(iii) death, then such Employee 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 Employee), or the Start Date (in the case of a New
Employee), and the date of such Permitted Termination, 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 Employee 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 that have elapsed between such New Employee'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.
6.2. Promotions; Demotions. If an Employee is promoted or
demoted during the Performance Period to a level that is included within the
definition of Employee, then such person shall be entitled to an amount equal to
a Payment Amount calculated in accordance with Section 4 hereof, but based upon
the sum of the products of (i) the Base Unit applicable to each level held by
such person during the Performance Period, multiplied by (ii) a fraction the
numerator of which is the number of days during the Performance Period that such
level was held and the denominator of which is the number of days in the
Performance Period. If an Employee is demoted during the Performance Period to
a level below that included within the definition of Employee, then such person
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 such person was at a level
included within
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the definition of Employee and the denominator of which is the number of days in
the Performance Period.
6.3. Reduction of Payment Amount in Certain Circumstances.
In the event that an Employee is on a voluntary leave of absence or long-term
disability during some or all of the Performance Period, the Payment Amount will
be reduced by multiplying it by a fraction, the numerator of which is the number
of days the Employee worked for an Employer (or Employers) during the
Performance and the denominator of which is 1,095.
6.4. Employment. As used in this Section 6, employment by
the Company shall include employment by a corporation which is a "subsidiary
corporation" of the Company, 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 Employee 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 Employee or otherwise credited to an account for the benefit of
such Employee.
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 Employee 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 Employee 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 or any of
its subsidiaries to the Employee, or may request the Employee to pay to the
Company in cash, such amount as the Company or any of its subsidiaries may be
required, under all applicable federal, state, local or other laws or
regulations, to withhold and pay over with respect to the Award.
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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, 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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