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EXHIBIT 10.2
LANCE, INC.
2001 LONG-TERM INCENTIVE PLAN FOR OFFICERS
Purposes and Introduction The primary purposes of the 2001 Long-Term
Incentive Plan for Officers are to:
o Align executives' interests with
those of stockholders by linking a
substantial portion of pay to the
price of Lance Common Stock.
o Provide a way to attract and retain
key executives and managers who are
critical to Lance's future success.
o Increase total pay for executives
and managers to competitive levels.
To achieve the maximum motivational impact,
plan goals and the rewards that will be
received for meeting those goals will be
communicated to participants as soon as
practical after the 2001 Plan is approved by
the Stock Award Committee.
Each participant will be granted one or more
Awards. Awards will be earned to the extent
predetermined goals are attained.
Plan Years The period over which performance will be
measured is the Company's fiscal year and
the two, three, four and 10 year periods
after the date of grant of awards.
Eligibility and Participation Eligibility in the Plan is limited to
Executive Officers and managers who are key
to Lance's success. The Stock Award
Committee of the Board of Directors will
review and approve participants nominated by
the President and CEO. Participation in one
year does not guarantee participation in a
following year but will be reevaluated and
determined on an annual basis.
Attachment A includes the list of 2001
participants approved by the Stock Award
Committee on January 30, 2001. Initial
awards will be made as soon as possible
after the approval of the 2001 Plan by the
Stock Award Committee.
Awards Each participant will be granted Awards
expressed as an economic value equal to a
percentage of his or her Base Salary.
Participants may be assigned to a
Performance Tier by position by salary level
or based on other factors as determined by
the President and CEO. If the job duties of
a position change during the year, or Base
Salary is increased significantly, the Award
shall be revised as
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appropriate.
Attachment A lists the Awards for each
participant for the 2001 Plan Year as
granted by the Stock Award Committee. Awards
will be communicated to each participant as
close to the beginning of the year as
practicable, in writing. Awards will be
calculated by multiplying each participant's
Base Salary by the appropriate percentages,
as described below.
o Awards shall be calculated as
follows:
Percentage of Base Salary
Performance Tier for 2001 Awards
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1 *%
2 *%
3 *%
4 *%
o For 2001, Awards will be allocated
as follows:
As a Percentage of Base Salary
Restricted Stock
----------------
Performance 100% Stock
Tier of Target Options Regular Performance
----------- --------- ------- ------- -----------
1 *% *% *% *%
2 *% *% *% *%
3 *% *% *% *%
4** *% *% *% *%
--------------
*Target Awards not required to be disclosed.
**Only specified Tier 4 employees receive
restricted stock awards.
o To determine the number of shares of stock
issued pursuant to each stock option,
restricted stock grant and performance
restricted stock grant the value of each
option is calculated using the Black-Scholes
model and each restricted stock grant using
compensation adviser's model, subject to
certain adjustments.
Long-Term Incentives Each Participant shall receive stock options
equal to 50% in economic value of his or her
Award, 25% in economic value will be in
regular restricted stock and 25% in economic
value in performance restricted stock.
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Stock options will be nonqualified and will
vest in four equal annual installments
beginning one year after the date of grant
and shall be exercisable for 10 years after
the date of grant.
Restricted stock will vest as to 50% two
years after the date of grant and the
balance four years after the date of grant.
Performance restricted stock will vest three
years after the date of grant, if the
cumulative consolidated earnings per share
of Lance, Inc. for the three fiscal years
2001, 2002 and 2003 equal or exceed $* per
share.
[*Target not required to be disclosed.]
Form and Timing of Awards will be made as soon as practicable
Awards after awards are approved by the Stock Award
Committee of the Board of Directors. All
awards will be rounded up to the nearest
multiple of 50 shares.
Change In Status An employee hired into an eligible position
during the year may participate in the plan
for the balance of the year on a pro rata
basis.
Certain Terminations of In the event a participant voluntarily
Employment terminates employment any award which has
not vested will terminate and be forfeited.
In the event a participant is terminated
involuntarily, any award which has not
vested will terminate and be forfeited
except that stock options which have vested
prior to involuntary termination may be
exercised within 30 days of termination. In
the event of death, stock options shall
become fully vested and may be exercised
within one year of death. In the event of
permanent disability, stock options shall
become fully vested and remain exercisable
in accordance with the terms of the award.
In the event of normal retirement, stock
options which have or will vest within six
months of normal retirement will vest and
become exercisable in accordance with the
terms of the award and may be exercised
within three years of normal retirement. In
the event of death, disability or normal
retirement, restricted stock and performance
restricted stock awards which are not vested
will be vested pro rata based on the number
of full months elapsed since the date of the
award. In the event of early retirement,
restricted stock awards which are not vested
will be vested pro rata based on the number
of full months elapsed since the date of the
award. In all other cases, awards which have
not vested upon termination of employment
will terminate and be forfeited.
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Change In Control In the event of a Change in Control, the
vesting of awards will be accelerated to
fully vest upon the effective date of a
Change in Control.
For this purpose, a Change in Control is
defined as when any person, corporation or
other entity and its affiliates (excluding
members of the Van Every Family and any
trust, custodian or fiduciary for the
benefit of any one or more members of the
Van Every Family) acquires or contracts to
acquire or otherwise controls in excess of
35% of the then outstanding equity
securities of the Company. For the purposes
of this plan, the Van Every Family shall
mean the lineal descendants of Salem A. Van
Every, Sr., whether by blood or adoption,
and their spouses.
Withholding The Company shall withhold from awards any
Federal, foreign, state, or local income or
other taxes required to be withheld.
Communications Progress reports should be made to
participants annually, showing performance
results.
Executive Officers Notwithstanding any provisions to the
contrary above, participation, Awards and
prorations for executive officers, including
the President and CEO, shall be approved by
the Stock Award Committee.
Governance The Stock Award Committee of the Board of
Directors of Lance, Inc. is ultimately
responsible for the administration and
governance of the Plan. Actions requiring
Committee approval include final
determination of plan eligibility and
participation, identification of performance
goals and final award determination. The
decisions of the Committee shall be
conclusive and binding on all participants.
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ATTACHMENT A
[Target Awards omitted for participants as target levels not required to be
disclosed.]