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Exhibit 10.2
LANCE, INC.
1999 Long-Term Incentive Plan for Officers
Purposes and Introduction
The primary purposes of the 1999 Long-Term Incentive Plan for Officers
are to:
-- Align executives' interests with those of stockholders by
linking a substantial portion of pay to the price of Lance
Common Stock.
-- Provide a way to attract and retain key executives and senior
managers who are critical to Lance's future success.
-- Increase total pay for executives and senior 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 1999 Plan is approved by
the Compensation/Stock Option 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 and four year periods after the date of
grant of awards.
Eligibility and Participation
Eligibility in the Plan is limited to Executive Officers and senior
managers who are key to Lance's success. The Compensation/ Stock
Option 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 1999 participants approved by the
Compensation/Stock Option Committee at its February 15, 1999 meeting.
Initial awards will be made as soon as possible after the approval of
the 1999 Plan by the Compensation/Stock Option Committee.
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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 appropriate.
Attachment A lists the Awards for each participant for the 1999 Plan
Year as granted by the Compensation/Stock Option 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.
-- Awards shall be calculated as follows:
Percentage of Base Salary
Performance Tier for 1999 Awards
---------------- -------------------------
1 *%
2 *%
3 *%
-- For 1999, Awards will be allocated as follows:
As a Percentage of Base Salary
Restricted Stock
-----------------------
Performance 100% of Stock
Tier of Target Options Regular Performance
----------- --------- ------- ------- -----------
1 *% *% *% *%
2 *% *% *% *%
3 *% *% *% *%
-- 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 counsel's model.
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 restricted
stock and 25% in economic value in performance restricted stock.
[*Targets not required to be disclosed.]
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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 1999, 2000 and 2001 equal or exceed $*
per share.
Form and Timing of Awards
Awards will be made as soon as practicable after awards are approved
by the Compensation/Stock Option 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 Employment
In the event a participant voluntarily 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.
[*Target not required to be disclosed.]
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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 Compensation/Stock Option Committee.
Governance
The Compensation/Stock Option 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 targets not required to be
disclosed.]