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EXHIBIT 10(c)
THIRD AMENDMENT TO THE
QUAKER STATE CORPORATION
(formerly Quaker State Oil Refining Corporation)
1986 STOCK OPTION PLAN
This Third Amendment made effective this 24th day of October, 1996 by
Quaker State Corporation (the "Corporation")
WITNESSETH:
WHEREAS, the Corporation established the Quaker State Corporation 1986
Stock Option Plan (the "Plan") on March 27, 1986, amended and restated the Plan
on April 30, 1987, and amended the Plan on February 27, 1992; and
WHEREAS, the Plan may be amended in accordance with SECTION 8
thereof; and
WHEREAS, the Corporation wishes to amend the Plan as a result of
changes in the requirements of Rule 16b-3 under the Securities Exchange Act of
1934, as amended;
NOW, THEREFORE, under the powers retained by the Corporation's Board
of Directors under SECTION 8 of the Plan and pursuant to the authorization of
the Board of Directors granted on October 24, 1996, the Corporation hereby
amends the Plan as follows:
1. Section 1, Administration, is hereby amended by deleting the first
paragraph and substituting the following in lieu thereof:
"The Plan shall be administered by a Committee (the "Committee")
appointed by the Board of Directors (the "Board") and shall consist of
not less than three directors, each of whom is a "non-employee
director" as defined in Rule 16b-3(b)(3) under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), or any successor rule.
From and after October 24, 1996, the Plan shall not be administered by
the committee appointed by the Board to administer the Corporation's
1976 Stock Option Plan, as amended (the "1976 Plan"), unless each
director on such committee also satisfies the requirements specified
in Rule 16b-3(b)(3) of the Exchange Act."
2. Section 5, Terms and Conditions of Stock Options and Stock
Appreciation Rights, subsection D is hereby amended by deleting same in its
entirety and substituting the following in lieu thereof:
"Stock appreciation rights shall be exercisable to the extent that the
related stock option is exercisable and only by the same person or
persons who are entitled to exercise the related stock option. Stock
appreciation rights shall entitle the optionee to surrender the
related stock option, or any portion thereof, and to receive from the
Corporation in exchange therefor that number of shares of the Capital
Stock having an aggregate fair market value on the date of exercise of
the stock appreciation rights equal to the excess of the fair market
value of one share of the Capital Stock on such date of exercise over
the option price per share times the number of shares covered by the
related stock option, or portion thereof, which is surrendered. Stock
appreciation rights granted in conjunction with an incentive stock
option shall not be exercisable unless the then fair market value of
the Capital Stock exceeds the option price of the shares subject to
the incentive stock option. Cash shall be paid in lieu of any
fractional shares. The Committee shall have the authority, in its
discretion, to determine that the obligation of the Corporation shall
be paid in cash or part in cash and part in shares. The date of
exercise of stock appreciation rights shall be determined under
procedures established by the Committee, and payment under this
Section 5(D) shall be made by the Corporation as soon as practicable
after the date of exercise. To the extent that a stock option as to
which stock appreciation rights have been granted in conjunction
therewith is exercised, the stock appreciation rights shall be
cancelled. For the purposes of this Section 5(D), the fair market
value of the Capital Stock shall be determined as provided in Section
5(H)".
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3. Section 8, Withholding, is hereby amended by deleting the third
paragraph thereof in its entirety.
4. In all other respects, the provisions of the Plan are hereby ratified
and confirmed, and shall continue in full force and effect. In order to
continue to set forth all provisions of the Plan in a single document, changes
made by this Third Amendment may be incorporated into a restatement of the
Plan.
IN WITNESS WHEREOF, the Corporation has evidenced the adoption of this
Third Amendment to the Plan by the signature of its duly authorized officer.
QUAKER STATE CORPORATION
Attest:
By: /s/ Paul E. Konney
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/s/ Carrie L. Sherwood Paul E. Konney
-------------------------- Senior Vice President, General
Assistant Secretary Counsel and Secretary
(SEAL)