EXHIBIT 10.13
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ANTHONY & SYLVAN POOLS CORPORATION
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2001 LONG-TERM INCENTIVE PLAN
1. Purpose
The purpose of the Anthony & Sylvan Pools Corporation 2001 Long-Term
Incentive Plan (the "Plan") is to promote the long-term growth and performance
of Anthony & Sylvan Pools Corporation (the "Company"). The Plan provides an
opportunity for employees and directors of the Company to participate through
share ownership in the long-term growth and success of the Company, enhances the
Company's ability to attract and retain persons with desired abilities, provides
additional incentives for such persons and identifies interests of employees,
directors and shareholders of the Company.
2. Definitions
(a) "Award" means any form of stock option, stock appreciation right,
restricted shares, share or share-based award or performance share granted to a
Participant under the Plan.
(b) "Award Agreement" means a written agreement between the Company and
a Participant setting forth the terms, conditions and limitations applicable to
an Award.
(c) "Board" means the Board of Directors of the Company.
(d) "Code" means the Internal Revenue Code of 1986, as amended from
time to time.
(e) "Committee" means the Compensation Committee of the Company's
Board, or such other committee of the Board that is designated by the Board to
administer the Plan, provided that the Committee shall be constituted so as to
satisfy any applicable legal requirements, including the requirements of Rule
16b-3 promulgated under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and Section 162(m) of the Code or any respective successor
rule.
(f) "Fair Market Value" means the avenge of the closing prices of
Shares as reported on the Nasdaq Stock Market for the preceding ten (10) days on
which sales of Shares were made on the Nasdaq Stock Market.
(g) "Participant" means (i) any employee of the Company, (ii) any
employee of any direct or indirect subsidiary of the Company, (iii) any director
of the Company, or (iv) any other person whose selection the Committee
determines to be in the best interests of the Company, to whom an Award is made
under the Plan.
(h) "Shares" means the common stock, without par value, of the Company.
3. Shares Available for Awards
Subject to adjustment as provided in Section 11 below, the aggregate
number of Shares which may be awarded under the Plan shall be four hundred
thousand (400,000) Shares. No more than one hundred and twenty thousand
(120,000) Shares shall be the subject of Awards to any individual Participant in
any one calendar year. Shares issuable under the Plan may consist of authorized
and unissued Shares or treasury Shares.
Any Shares issued by the Company through the assumption or substitution
of outstanding grants previously made by an acquired corporation or entity shall
not reduce the number of Shares available for Awards under the Plan. Any Shares
issued by the Company through the conversion or substitution of outstanding
grants previously made by Essef Corporation shall not reduce the number of
Shares available for Awards under the Plan. If any Shares subject to any Award
granted under the Plan are forfeited or if such Award otherwise terminates
without the issuance of such Shares or payment of other consideration in lieu of
such Shares, the Shares subject to such Award, to the extent of
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any such forfeiture or termination, shall again be available for grant under the
Plan as if such Shares had not been subject to an Award.
4. Administration
The Plan shall be administered by the Committee, which shall have full
power and authority to interpret the Plan, to grant waivers of Plan restrictions
and to adopt such rules, regulations and policies for carrying out the Plan as
it may deem necessary or proper in order to further the purposes of the Plan. In
particular, the Committee shall have the authority to (i) select Participants to
receive Awards, (ii) determine the number and type of Awards to be granted,
(iii) determine the terms and conditions, not inconsistent with the terms
hereof, of any Award granted, (iv) interpret the terms and provisions of the
Plan and any Award granted, (v) prescribe the form of any agreement or
instrument executed in connection with any Award, and (vi) establish, amend and
rescind such rules, regulations and policies for the administration of the Plan
as it may deem advisable from time to time.
5. Awards
The Committee shall determine the type(s) of Award(s) to be made to
each Participant and shall set forth in the related Award Agreement the terms,
conditions and limitations applicable to each Award. Awards may include but are
not limited to those listed in this Section 5. Awards may be made singly, in
combination, in tandem or in exchange for a previously granted Award, and also
may be made in combination or in tandem with, in replacement of, or as
alternatives to, grants or rights under any other employee plan of the Company,
including the plan of any acquired entity.
(a) Stock options. Awards may be made in the form of stock options,
which may be incentive stock options within the meaning of Section 422 of the
Code or nonstatutory stock options not intended to qualify under Section 422 of
the Code. Incentive stock options may be granted only to employees. The
aggregate Fair Market Value (determined at the time the option is granted) of
Shares as to which incentive stock options are exercisable for the first time by
a Participant during any calendar year (under the Plan and any other plan of the
Company) shall not exceed $100,000 (or such other limit as may be required by
the Code from time to time). The exercise price of stock options granted under
the Plan shall be determined by the Committee. The exercise price of a
nonstatutory stock option may be at a discount to Fair Market Value on the date
of the grant. The exercise price of an incentive stock option shall be not less
than 100% of Fair Market Value on the date of the grant. A stock option granted
under the Plan shall be exercisable in whole or in such installments and at such
times and upon such terms as may be determined by the Committee, provided that
no incentive stock option shall be exercisable more than ten years after the
date of grant. A participant may pay the exercise price of a stock option in
cash, Shares or a combination of cash and Shares. The Committee shall establish
appropriate procedures for accepting Shares in payment of the exercise price of
a stock option and may impose such conditions as it deems appropriate on such
use of Shares. The Committee is authorized to provide for the automatic granting
of an additional stock option to an Optionee who uses Shares to exercise a stock
option and the Committee shall establish appropriate procedures with respect to
such additional stock options relating to (i) the exercise price of such
additional stock options, (ii) the number of Shares to be covered by such
additional stock options, (iii) the vesting period for such additional stock
options, (iv) the status of such additional stock options as incentive stock
options or non-statutory stock options, and (v) the limitations contained in
Section 3 of this Plan concerning the aggregate number of Shares that may be
awarded under this Plan.
(b) Stock Appreciation Rights. Awards may be granted in the form of
stock appreciation rights ("SARs"). SARs shall entitle the recipient to receive
a payment, in cash or Shares, equal to the appreciation in market value of a
stated number of Shares from the price stated in the Award Agreement to the Fair
Market Value on the date of exercise or surrender. SARs may be granted either
separately or in conjunction with other Awards granted under the Plan. Any SAR
related to a nonstatutory stock option may be granted at the same time such
option is granted or any time thereafter before exercise or expiration of such
option. Any SAR related to an incentive stock option must be granted at the same
time such option is granted. Any SAR related to an option shall be
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exercisable only to the extent the related option is exercisable. In the case of
any SAR related to any option, the SAR or applicable portion thereof shall
terminate and no longer be exercisable upon the termination or exercise of the
related option. Similarly, upon exercise of an SAR as to some or all of the
Shares covered by a related option, the related option shall be canceled
automatically to the extent of the SARs exercised, and such Shares shall not
thereafter be eligible for grant. The Committee may impose such conditions or
restrictions upon the exercise of any SAR as it shall deem appropriate.
(c) Restricted Shares. Awards may be granted in the form of restricted
Shares in such numbers and at such times as the Committee shall determine.
Awards of restricted Shares shall be subject to such terms, conditions or
restrictions as the Committee deems appropriate including, but not limited to,
restrictions on transferability, requirements of continued employment,
individual performance or financial performance of the Company. The period of
vesting and forfeiture restrictions shall be established by the Committee at the
time of grant. During the period in which any restricted Shares are subject to
forfeiture restrictions, the Committee may, in its discretion, grant to the
Participant to whom such restricted Shares have been awarded, all or any of the
rights of a shareholder with respect to such restricted Shares, including the
right to vote such Shares and to receive dividends with respect to such Shares.
(d) Performance Shares. Awards may be made in the form of Shares that
are earned only after the attainment of predetermined performance targets as
established by the Committee at the time an Award is made ("Performance
Shares"). A performance target shall be based upon one or any combination of the
following: (i) revenues of the Company; (ii) operating income of the Company;
(iii) net income of the Company; (iv) earnings per Share; (v) the Company's
return on equity; (vi) cash flow of the Company; (vii) Company shareholder total
return; (viii) return on assets; (ix) return on investment; (x) asset turnover;
(xi) liquidity; (xii) capitalization; (xiii) stock price; (xiv) expenses; (xv)
operating profit and margin; (xvi) retained earnings; (xvii) market share;
(xviii) sales to targeted customers; (xix) customer satisfaction; (xx) quality
measures; (xxi) productivity; (xxii) safety measures; or (xxiii) educational and
technical skills of employees. Performance targets may also be based on the
attainment of levels of performance of the Company and/or any of its affiliates
or divisions under one or more of the measures described above relative to the
performance of other businesses. The Committee shall be permitted to make
adjustments when determining the attainment of a performance target to reflect
extraordinary or nonrecurring items or events, or unusual nonrecurring gains or
losses identified in the Company's financial statements, as long as any such
adjustments are made in a manner consistent with Section 162(m) of the Code to
the extent applicable. Awards of Performance Shares made to Participants subject
to Section 162(m) of the Code are intended to qualify under Section 162(m) and
provisions of such Awards shall be interpreted in a manner consistent with that
intent to the extent appropriate. The foregoing provisions of this Section 5(d)
also shall be applicable to Awards of restricted Shares made under Section 5(c)
to the extent such Awards of restricted Shares are subject to the financial
performance of the Company. At the end of the applicable performance period,
Performance Shares shall be converted into Shares (or cash or a combination of
Shares and cash, as set forth in the Award Agreement) and distributed to
Participants based upon the applicable performance entitlement. Award payments
made in cash rather than the issuance of Shares shall not, by reason of such
payment in cash, result in additional Shares being available under the Plan.
(e) Stock Awards. Awards may be made in Shares or on a basis valued in
whole or in part by reference to, or otherwise based upon, Shares. Share awards
shall be subject to conditions established by the Committee and set forth in the
Award Agreement.
(f) Awards to Directors. Each new non-employee director shall be
granted options immediately upon first becoming a director and at each Annual
Meeting of shareholders thereafter provided that the non-employee director
continues holding such position following the meeting. The terms and conditions
of such grants shall be determined by the full Board at the time of such grants.
(g) Integration with Deferred Compensation Plan. The Committee may
establish such procedures as it deems appropriate to permit a Participant to
cancel or surrender all or any portion of an Award in exchange for a credit to
the Participant's Deferred
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Compensation Account maintained under the Company's Deferred Compensation Plan
for Employees and Directors.
6. Payment of Awards; Deferrals
Payment of Awards may be made in the form of Shares, cash or a
combination of Shares and cash and may include such restrictions as the
Committee shall determine, including restrictions on transfer and forfeiture
provisions. With Committee approval, payments may be deferred, either in the
form of installments or a future lump sum payment. The Committee may permit
Participants to elect to defer payments of some or all types of Awards in
accordance with procedures established by the Committee to assure that such
deferrals comply with applicable requirements of the Code including the
capability to make further deferrals for payment after retirement. The Committee
may also establish rules and procedures for the crediting of interest on
deferred cash payments and dividend equivalents for deferred payments
denominated in Shares.
7. Tax Withholding
The Company shall have the authority to withhold, or to require a
Participant to remit to the Company, prior to issuance or delivery of any Shares
or cash relating to an Award made under the Plan, an amount sufficient to
satisfy federal, state and local tax withholding requirements associated with
any Award. In addition, the Company may, in its sole discretion, permit a
Participant to satisfy any tax withholding requirements, in whole or in part, by
(i) delivering to the Company Shares held by such Participant having a Fair
Market Value equal to the amount of the tax or (ii) directing the Company to
retain Shares having such Fair Market Value and otherwise issuable to the
Participant under the Plan.
8. Termination of Employment or Service as a Director
If the employment of a Participant (or such Participant's service as a
director) terminates for any reason, all unexercised, deferred and unpaid Awards
shall be exercisable or paid in accordance with the applicable Award Agreement,
which may provide that the Committee may authorize, as it deems appropriate, the
acceleration and/or continuation of all or any part of Awards granted prior to
such termination.
9. Nonassignability
Except as may be otherwise provided in the relevant Award Agreement, no
Award or any benefit under the Plan shall be assignable or transferable, or
payable to or exercisable by, anyone other than the Participant to whom it was
granted.
10. Change in Control
(a) In the event of a Change in Control (as defined below) of the
Company, and except as the Board may expressly provide otherwise, (i) all stock
options or SARs then outstanding shall become fully exercisable as of the date
of the Change in Control, whether or not then otherwise exercisable, (ii) all
restrictions and conditions of all Awards of restricted Shares then outstanding
shall be deemed satisfied as of the date of the Change in Control, and (iii) all
Awards of Performance Shares shall be deemed to have been fully earned as of the
date of the Change in Control.
(b) A "Change in Control" of the Company shall have occurred when any
of the following events shall occur:
(i) The Company is merged, consolidated or reorganized into or with
another corporation or other legal person, and immediately after such
merger, consolidation or reorganization less than a majority of the
combined voting power of the then-outstanding securities of such
corporation or person immediately after such transaction are held in
the aggregate by the holders of Voting Stock (as that term is hereafter
defined) of the Company immediately prior to such transaction;
(ii) The Company sells all or substantially all of its assets to any
other corporation or other legal person, less than a majority of the
combined voting power
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of the then-outstanding securities of such corporation or person
immediately after such sale are held in the aggregate by the holders of
Voting Stock of the Company immediately prior to such sale;
(iii) There is a report filed or required to be filed on Schedule 13D
on Schedule l4D-1 (or any successor schedule, form or report), each as
promulgated pursuant to the Exchange Act, disclosing that any person
(as the term "person" is used in Section l3(d)(3) or Section l4(d)(2)
of the Exchange Act) has become the beneficial owner (as the term
"beneficial owner, is defined under Rule l3d-3 or any successor rule or
regulation promulgated under the Exchange Act) of securities
representing more than 50% of the combined voting power of the
then-outstanding securities entitled to vote generally in the election
of directors of the Company ("Voting Stock"); or
(iv) The Company files a report or proxy statement with the Securities
and Exchange Commission pursuant to the Exchange Act disclosing in
response to Form 8-K or Schedule 14A (or any successor schedule, form
or report or item therein) that a change in control of the Company has
or may have occurred or will or may occur in the future pursuant to any
then-existing contract or transaction.
Notwithstanding the foregoing provisions of Section 10(b)(iii) or (iv)
hereof, unless otherwise determined in a specific case by majority vote of the
Board, a "Change in Control" shall not be deemed to have occurred for purposes
of the Plan solely because (i) the Company, (ii) an entity in which the Company
directly or indirectly beneficially owns 50% or more of the voting securities or
interest, or (iii) any Company-sponsored employee stock ownership plan or any
other employee benefit plan of the Company, either files or becomes obligated to
file a report or a proxy statement under or in response to Schedule 13D,
Schedule 14D-l, Form 8-K or Schedule l4A (or any successor schedule, form or
report or item therein) under the Exchange Act, disclosing beneficial ownership
by it of shares of Voting Stock, whether in excess of 50% or otherwise, or
because the Company reports that a change in control of the Company has or may
have occurred or will or may occur in the future by reason of such beneficial
ownership. Further, a "Change in Control" shall not be deemed to have occurred
by reason of any change resulting from the Company's bankruptcy, insolvency or
otherwise for the benefit of the Company's creditors.
11. Adjustments upon Changes of Capitalization
In the event of any change in the outstanding Shares by reason of a
reorganization, recapitalization, stock split, stock dividend, combination or
exchange of shares, merger, consolidation or any change in the corporate
structure or Shares of the Company, the number of Shares as to which Awards may
be granted under the Plan, including limitations relating to incentive stock
option Awards and maximum Awards to individual Participants, the number of
Shares issuable pursuant to then outstanding Awards, and/or, if appropriate, the
prices of Shares related to outstanding Awards, shall be appropriately and
proportionately adjusted.
12. Rights of Employees
Nothing in the Plan shall interfere with or limit in any way the right
of the Company or any subsidiary of the Company to terminate any Participant's
employment at any time, nor confer upon any Participant any right to continued
employment with the Company or any subsidiary of the Company.
13. Amendment, Suspension or Termination of Plan and Awards
The Board may amend, suspend or terminate the Plan at any time,
provided that no such action shall be taken that would impair the rights under
an outstanding Award without the Participant's consent.
The Board may amend the terms of any outstanding Award, prospectively or
retroactively, but no such amendment shall impair the rights of any Participant
without the Participant's consent and no such amendment shall have the effect,
with respect to any employee subject to Section 162(m) of the Code, of
increasing the amount of any Award from the amount that would otherwise be
payable pursuant to the formula and/or goals previously established for
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such Participant.
14. Governing Law
The Plan, together with all determinations and actions made or taken in
connection therewith, to the extent not otherwise governed by the Code or other
laws of the United States, shall be governed by the laws of the State of Ohio.
15. Effective and Termination Dates
The Plan shall become effective on the date it is approved by the
shareholders of the Company. The Plan shall continue in effect until terminated
by the Board, at which time all outstanding Awards shall remain outstanding in
accordance with their applicable terms and conditions.
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