EXHIBIT 10(a)
QUAKER CHEMICAL CORPORATION
1993 LONG-TERM PERFORMANCE INCENTIVE PLAN
1. PURPOSE OF THE PLAN
This Long-Term Performance Incentive Plan (the "Plan") has been
established to provide incentives and awards to those employees largely
responsible for the long-term success of the Quaker Chemical Corporation (the
"Company") and its subsidiaries. In addition, the Plan is intended to enable
the Company to attract and retain executives in the future and to encourage
key employees to acquire a proprietary interest in the performance of the
Company by purchasing and owning shares of Common Stock of the Company.
2. GENERAL PROVISIONS
2.1 Definitions.
As used in the Plan:
(a) "Act" means the Securities Exchange Act of 1934,
as amended.
(b) "Board of Directors" means the Board of Directors
of the Company.
(c) "Code" means the Internal Revenue Code of 1986, as
amended.
(d) "Committee" means the Long-Term Performance
Incentive Committee of the Board of Directors.
(e) "Common Stock" means the Common Stock, par value
$1.00 per share, of the Company.
(f) "Fair Market Value" means, with respect to the
date a given Stock Option or Stock Appreciation
Right is granted or exercised, the last sale price
(or, if no last sale price is reported, the
average of the high bid and low asked price) for a
share of Common Stock in the over-the-counter
market, as reported on NASDAQ or, if not reported
on NASDAQ, as quoted by the National Quotation
Bureau Incorporated, or, if the Common Stock is
listed on a national securities exchange, on the
principal exchange on which the Common Stock is
listed. If for any day the Fair Market Value of a
share of Common Stock is not determinable by any
of the foregoing means, then the Fair Market Value
for such day shall be determined in good faith by
the Committee on the basis of such quotations and
other considerations as the Committee deems
appropriate.
(g) "Incentive Stock Option" means an option granted
under the Plan, which is intended to qualify as an
incentive stock option under Section 422 of the
Code.
(h) "NASDAQ" means the National Association of
Securities Dealers National Market.
(i) "Non-Qualified Stock Option" means an option
granted under the Plan which is not an Incentive
Stock Option.
(j) "Option Event" means the date on which beneficial
ownership (determined in accordance with Rule 13d-
3 under the Act) of shares of the Company's Common
Stock are acquired (other than directly from the
Company in exchange for cash or property) by any
Person (as used in Section 13 or 14 of the Act, as
amended), other than a person who is an officer or
director of the Company on December 23, 1992, who
thereby becomes the beneficial owner (as defined
in Rule 13d-3 under the Act) of more than 10% of
the issued and outstanding shares of the Company's
Common Stock.
(k) "Participant" means an employee of the Company or
one or more of its Subsidiaries to whom a Stock
Option, a Stock Appreciation Right and/or a
Performance Incentive Unit has been granted under
the Plan.
(l) "Performance Award Period" means a period of four
(4) consecutive calendar years, the first of which
shall commence on January 1, 1993 and the balance
of which shall commence on January 1, of every
second calendar year thereafter through 2001.
(m) "Performance Incentive Unit" means a unit granted
in accordance with the provisions of Section 4.1
of the Plan.
(n) "Performance Program Target" means the performance
program targets fixed by the Committee for a
particular Performance Award Period.
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(o) "Rule 16b-3" means Rule 16b-3 promulgated under
the Securities Exchange Act of 1934, as amended
from time to time, or any successor Rule.
(p) "Stock Appreciation Right" means a right granted,
pursuant to Section 3.7 of the Plan, to a holder
of a Stock Option.
(q) "Stock Option" means an Incentive Stock Option or
Non-Qualified Stock Option granted under the Plan.
(r) "Subsidiary" means any corporation whose
outstanding voting securities having ordinary
voting power to elect directors (other than
securities having such power only by reason of the
happening of a contingency) shall at the time be
50% or more owned, directly or indirectly, by the
Company.
2.2 Administration of the Plan.
(a) The Plan shall be administered by the Committee
which shall have the full power, subject to and
within the limits of the Plan, to: (i) interpret
and administer the Plan, and Stock Options,
Performance Incentive Units and Stock Appreciation
Rights granted under it; and (ii) make and
interpret rules and regulations for the
administration of the Plan and to make changes in
and revoke such rules and regulations. The
Committee, in the exercise of this powers, shall
(i) generally determine all questions of policy
and expediency that may arise and may correct any
defect, omission, or inconsistency in the Plan or
any agreement evidencing the grant of any Stock
Option, Performance Incentive Unit or Stock
Appreciation Right in a manner and to the extent
it shall deem necessary to make the Plan fully
effective; (ii) determine those eligible employees
to whom Stock Options, Stock Appreciation Rights,
and/or Performance Incentive Units shall be
granted and the number of any thereof to be
granted to any eligible employee, consistent with
the provisions of the Plan; (iii) determine the
terms of Stock Options, Stock Appreciation Rights,
and Performance Incentive Units granted under the
Plan, consistent with the provisions of the Plan;
and (iv) generally, exercise such powers and
perform such acts in connection with the Plan as
are deemed necessary or expedient to promote the
best interests of the Company.
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(b) The Committee shall consist of not less than two
(2) members of the Board of Directors who are not,
and who were not at any time within one year prior
to their appointment to the Committee, either a
Participant under the Plan or granted or awarded
equity securities under any other plan of the
Company or any affiliate of the Company which
would disqualify them from being a "disinterested
person" (as defined in Rule 16b-3) with respect to
the Plan. The Board may also select one or more
directors who satisfy the requirements in the
preceding sentence as alternate members of the
Committee who may take the place of any absent
member or members of the Committee at any meeting
of the Committee. The Committee may act only by a
majority of its members then in office; the
Committee may authorize any one or more of its
members or any officer of the Company to execute
and deliver documents on behalf of the Committee.
2.3 Effective Date.
This Plan shall be effective as of January 1, 1993,
provided that the Plan is approved by the Company's
shareholders on or before December 31, 1993. If the
Plan is not approved by the Company's shareholders on
or before December 31, 1993, this Plan and all awards
previously granted thereunder become null and void.
2.4 Duration.
If approved by the shareholders of the Company, as
provided in Section 2.3, unless sooner terminated by
the Board of Directors, the Plan shall remain in effect
until December 31, 2002.
2.5 Shares Subject to the Plan.
The maximum number of shares of Common Stock which may
be subject to Stock Options granted under the Plan
shall be 1,000,000, subject to adjustment in accordance
with Section 5.1, which shares may be either authorized
and unissued shares of Common Stock or authorized and
issued shares of Common Stock purchased or acquired by
the Company for any purpose. If a Stock Option or
portion thereof shall expire or be terminated,
cancelled or surrendered (other than in connection with
the surrender of a Stock Option pursuant to Section
3.7(a)) for any reason without being exercised in full,
the unpurchased shares of Common Stock which were
subject to such Stock Option or portion thereof shall
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be available for future grants of Stock Options under
the Plan.
2.6 Amendments.
The Plan may be suspended, terminated or reinstated, in
whole or in part, at any time by the Board of
Directors. The Board of Directors may from time to
time make such amendments to the Plan as it may deem
advisable, including, with respect to Incentive Stock
Options, amendments deemed necessary or desirable to
comply with Section 422 of the Code and any regulations
issued thereunder; provided, however, that, without the
approval of the Company's shareholders no amendment
shall be made which:
(a) Increases the maximum number of shares of Common
Stock which may be subject to Stock Options
granted under the Plan (other than as provided in
Section 5.1); or
(b) Extends the term of the Plan; or
(c) Increases the period during which a Stock Option
may be exercised beyond ten years from the date of
grant; or
(d) Otherwise materially increases the benefits
accruing to Participants under the Plan; or
(e) Materially modifies the requirements as to
eligibility for participation in the Plan; or
(f) Will cause Stock Options, Stock Appreciation
Rights or Performance Incentive Units issued or
granted under the Plan to fail to meet the
requirements of Rule 16b-3.
Termination or amendment of the Plan shall not, without
the consent of the Participant, affect such
Participant's rights under any Stock Option, Stock
Appreciation Right or Performance Incentive Unit
previously granted to such Participant.
2.7 Participants and Grants.
Stock Options, Stock Appreciation Rights and
Performance Incentive Units may be granted by the
Committee to those full-time salaried employees of the
Company and its Subsidiaries who the Committee
determines hold positions which enable them to have a
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significant impact on the Company's long-term financial
performance. The Committee may grant to eligible
employees Incentive Stock Options and/or Non-Qualified
Stock Options to purchase such number of shares of
Common Stock (subject to the limitations of Section
2.5) and Stock Appreciation Rights and/or such number
of Performance Incentive Units as the Committee may, in
its sole discretion, determine. In determining the
number of shares of Common Stock subject to a Stock
Option and/or the number of Performance Incentive Units
to be granted to an eligible employee, the Committee
shall consider the employee's base salary, his expected
contribution to the long-term performance of the
Company, and such other relevant facts as the Committee
shall deem appropriate. In granting Stock Options,
Stock Appreciation Rights and Performance Incentive
Units under the Plan, the Committee may vary the number
of Incentive Stock Options, Non-Qualified Options,
Stock Appreciation Rights and/or Performance Incentive
Units to an eligible employee in such amounts as the
Committee may determine in its discretion.
3. STOCK OPTIONS
3.1 General.
All Stock Options granted under the Plan shall be
evidenced by written agreements executed by the Company
and the employee to whom granted which agreement shall
state the number of shares of Common Stock which may be
purchased upon the exercise thereof and shall contain
such investment representations and other terms and
conditions as the Committee may from time to time
determine, or, in the case of Incentive Stock Options,
as may be required by Section 422 of the Code, or any
other applicable law.
3.2 Price.
Subject to the provisions of Section 3.6(d) and Section
5.1, the purchase price per share of Common Stock
subject to a Stock Option shall, in no case, be less
than 100 percent (100%) of the Fair Market Value of a
share of Common Stock on the date the Stock Option is
granted.
3.3 Period.
The duration or term of each Stock Option granted under
the Plan shall be for such period as the Committee
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shall determine, but in no event more than ten (10)
years from the date of grant thereof.
3.4 Exercise.
Subject to Section 5.1, no Stock Option shall be
exercisable prior to the expiration of one (1) year
from the date it is granted. Once exercisable, a Stock
Option shall be exercisable, in whole or in part, by
delivery of a written notice of exercise to the
Secretary of the Company at the principal office of the
Company specifying the number shares of Common Stock as
to which the Stock Option is then being exercised
together with payment of the full purchase price for
the shares being purchased upon such exercise. Until
the shares of Common Stock as to which a Stock Option
is exercised are paid for in full and issued, the
Participant shall have none of the rights of a
shareholder of the Company.
3.5 Payment.
The purchase price for shares of Common Stock as to
which a Stock Option has been exercised, may be paid:
(a) In United States dollars in cash, or by check,
bank draft or money order payable in United States
dollars to the order of the Company; or
(b) In the discretion of the Committee by note; or
(c) In the discretion of the Committee, by the
delivery by the Participant to the Company of
whole shares of Common Stock having an aggregate
Fair Market Value on the date of payment equal to
the aggregate of the purchase price of Common
Stock as to which the Stock Option is then being
exercised or by the withholding of whole shares of
Common Stock having such Fair Market Value upon
the exercise of such Stock Option; or
(d) In the discretion of the Committee, in United
States dollars in cash, or by check, bank draft or
money order payable in United States dollars to
the order of the Company delivered to the Company
by a broker in exchange for its receipt of stock
certificates from the Company in accordance with
instructions of the Participant to the broker
pursuant to which the broker is required to
deliver to the Company the amount of sale or loan
proceeds required to pay the purchase price; or
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(e) In the discretion of the Committee, by a
combination of any number of the foregoing.
The Committee may, in its discretion, impose
limitations, conditions and prohibitions on the use by
a Participant of shares of Common Stock to pay the
purchase price payable by such Participant upon the
exercise of a Stock Option.
3.6 Special rules for Incentive Stock Options.
Notwithstanding any other provision of the Plan, the
following provisions shall apply to Incentive Stock
Options granted under the Plan:
(a) Incentive Stock Options shall only be granted to
Participants who are employees of the Company or
its Subsidiaries.
(b) To the extent that the aggregate Fair Market Value
of stock, with respect to which Incentive Stock
Options are exercisable for the first time by a
Participant during any calendar year under this
Plan and any other Plan of the Company or a
Subsidiary, exceeds $100,000, such Stock Options
shall be treated as Non-Qualified Stock Options.
(c) Any Participant who disposes of shares of Common
Stock acquired upon the exercise of an Incentive
Stock Option by sale or exchange either within two
(2) years after the date of the grant of the
Incentive Stock Option under which the shares were
acquired or within one (1) year of the acquisition
of such shares, shall promptly notify the
Secretary of the Company at the principal office
of the Company of such disposition, the amount
realized, the purchase price per share paid upon
exercise and the date of disposition.
(d) No Incentive Stock Option shall be granted to a
Participant who, at the time of the grant, owns
stock representing more than ten percent (10%) of
the total combined voting power of all classes of
stock either of the Company or any parent or
Subsidiary of the Company, unless the purchase
price of the shares of Common Stock purchasable
upon exercise of such Incentive Stock Option is at
least one hundred ten percent (110%) of the Fair
Market Value (at the time the Incentive Stock
Option is granted) of the Common Stock and the
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Incentive Stock Option is not exercisable more
than five (5) years from the date it is granted.
3.7 Stock Appreciation Rights.
(a) Grant.
Stock Appreciation Rights may be granted under the
Plan by the Committee, but only in connection with
all or any part of a Stock Option granted under
the Plan. Stock Appreciation Rights may be
granted either concurrently with the grant of a
Stock Option or at any time thereafter during the
term of the Stock Option. A Stock Appreciation
Right shall be exercisable only upon surrender of
the related Stock Option or portion thereof and
shall entitle the Participant to receive the
excess of the Fair Market Value of the shares of
Common Stock for which the Stock Appreciation
Right is exercised on the date of such exercise
over the purchase price per share of Common Stock
under the related Stock Option. Such excess is
hereafter call the "Spread."
(b) Exercise of Stock Appreciation Right.
Stock Appreciation Rights shall be exercisable at
such time as and to the extent, but only to the
extent, that the Stock Option to which they relate
shall be exercisable and shall be subject to any
other terms and conditions, not inconsistent with
the Plan, as may be fixed by the Committee at the
time the Stock Appreciation Right is granted. No
Stock Appreciation Right shall be exercisable
prior to the later of: (i) six (6) months and one
(1) day following the date on which such Stock
Appreciation Right was granted, or (ii) the date
on which the related Stock Option or any portion
thereof first becomes exercisable. Shares of
Common Stock subject to a Stock Option surrendered
by a Participant in connection with an exercise of
Stock Appreciation Rights may not again be
subjected to Stock Options under the Plan. Upon
the exercise of Stock Appreciation Rights the
Participant shall be entitled to receive from the
Company in exchange for the surrendered Stock
Option or portion thereof, an amount equal to the
Spread either in cash, or in shares of Common
Stock having a Fair Market Value equal to the
Spread, or both, as the Committee may determine;
provided, however, that the number of shares of
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Common Stock which a Participant may receive upon
the exercise of Stock Appreciation Rights may not
exceed the number of shares of Common Stock
subject to the Stock Option or portion thereof
surrendered upon exercise of such Stock
Appreciation Rights. The shares of Common Stock
issuable upon exercise of Stock Appreciation
Rights may consist either in whole or in part of
authorized and unissued shares of Common Stock or
authorized and issued shares of Common Stock
purchased or acquired by the Company for any
purpose. If shares of Common Stock are to be
issued to a Participant upon exercise by the
Participant of Stock Appreciation Rights, such
Participant shall have none of the rights of a
shareholder of the Company until the shares of
Common Stock are issued.
3.8 Termination of Employment.
(a) In the event a Participant's employment by the
Company or its Subsidiaries shall be terminated
for cause, as determined by the Committee, while
the Participant holds Stock Options granted under
the Plan, all Stock Options held by the
Participant shall expire immediately.
(b) If a Participant, while holding Stock Options, (i)
retires upon reaching his normal retirement date
or having elected early retirement under a formal
plan or policy of the Company, or (ii) dies, then
each Stock Option held by the Participant shall be
exercisable by the Participant (or, in the case of
death, by the executor or administrator of the
Participant's estate or by the person or persons
to whom the deceased Participant's rights
thereunder shall have passed by will or by the
laws of descent or distribution) until the earlier
of (A) its stated expiration date, or, (B) the
date occurring three (3) years after the date of
such retirement or death, as the case may be. If
a Participant's employment by the Company or its
Subsidiaries shall terminate as a result of the
Participant's total disability, while such
Participant is holding Stock Options, then each
Stock Option held by the Participant shall be
exercisable by the Participant until its stated
expiration date. For purposes of the foregoing
sentence, "total disability" shall mean a
permanent mental or physical disability as
determined by the Committee.
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(c) If a Participant's employment by the Company or
its Subsidiaries shall terminate for any reason
not specified in Sections 3.8(a) or (b), the
Participant shall, to the extent otherwise
exercisable, have the right to exercise the Stock
Options held by him or her at the date of
termination for a period of three (3) months;
provided, however, that in no event shall such
Stock Options be exercisable after their stated
expiration date.
(d) Stock Options held by a Participant at the time of
the termination of his employment by the Company
or its Subsidiaries which, by their terms are not
then exercisable, shall, subject to, and except as
otherwise provided by, the provisions of (i) this
Section 3.8 regarding expiration or lapse, and
(ii) Section 3.10 regarding acceleration and
redemption become exercisable (if at all) at the
times, and otherwise in the manner, set forth in
connection with their original grant.
3.9 Effect of Leaves of Absence.
It shall not be considered a termination of employment
when a Participant is on military or sick leave or such
other type of leave of absence which is considered as
continuing intact the employment relationship of the
Participant with the Company or its Subsidiaries. In
case of such leave of absence, the employment
relationship shall be continued until the later of the
date when such leave equals ninety days or the date
when the Participant's right to reemployment shall no
longer be guaranteed either by statute or contract.
3.10 Acceleration and Redemption.
Upon the occurrence of an Option Event, (a) all Stock
Options granted and outstanding under the Plan shall
become immediately exercisable in full regardless of
any terms of said Stock Option to the contrary; and (b)
until the earlier to occur of the stated expiration
date of the Stock Option and the expiration of the
ninety (90) day period following written notice from
the Company to all Participants of the occurrence of
the Option Event, all Participants shall have the right
to demand that the Company cancel and redeem any and
all Stock Options held by the Participant by paying
with respect to each such Stock Option a price equal to
the difference between the purchase price per share of
Common Stock subject to such Stock Option and the
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highest price that can be determined to have been paid
by any Person (as that word is used in Section 2.1(j))
for any share or shares of the Company's Common Stock
prior to the earlier to occur of the stated expiration
date of the Stock Option and the expiration of the
aforementioned ninety (90) day demand period.
4. PERFORMANCE INCENTIVE UNITS
4.1 Grant.
From time to time during each Performance Award Period,
the Committee may grant Performance Incentive Units to
eligible employees in conjunction with or separately
from a grant of Stock options; provided, however, that
Performance Incentive Units shall not be granted to any
one eligible employee more often than once with respect
to a Performance Award Period.
4.2 Establishment of Stated Value and Performance Program
Targets.
At the beginning of each Performance Award Period, the
Committee shall establish the Performance Program
Targets applicable to that Performance Award Period
(which may be expressed as increases in the Company's
earnings per share, return or average return on
invested capital or in terms of any financial or other
standard, or combinations thereof, as the Committee may
determine in its discretion), the Stated Value (which
shall be expressed in dollars) of Performance Incentive
Units to be granted with respect to such Performance
Award Period, and shall fix the percentage, if any, of
the Stated Value to be earned upon the achievement of
the Performance Program Targets established for the
relevant performance Award Period; provided, however,
that the percentage of Stated Value to be earned upon
achievement of the maximum Performance Program Target
established with respect to a Performance Award Period
shall in no event exceed 200% of Stated Value fixed for
that Performance Award Period.
If the Committee determines that an unforeseen change
during a Performance Award Period in the Company's
business operations, corporate structure, capital
structure or manner in which it conducts business is
extraordinary and material and that the Performance
Program Targets established for the Performance Award
Period are no longer suitable, the Committee may, but
only with the concurrence of the Board of Directors,
modify the Performance Program Targets as it deems
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appropriate and equitable; provided, however, that no
such modification shall increase the Performance
Program Targets in effect for any Performance Award
Period (i.e., establish a target that is more difficult
to achieve than the original Performance Program
Target).
4.3 Payment.
As promptly as practicable after the end of each
Performance Award Period, the Committee shall, pursuant
to Section 4.2 of the Plan, determine the earned
percentage of Stated Value of the Performance Incentive
Units granted with respect to such completed
Performance Award Period. The Company shall, as soon
as practicable after such determination has been made,
pay to each Participant holding Performance Incentive
Units granted with respect to such completed
Performance Award Period, for each such Performance
Incentive Units held by him or her an amount equal to
the product obtained by multiplying Stated Value by the
earned percentage of Stated Value.
4.4 Termination of Employment.
If a Participant's employment by the Company and its
Subsidiaries terminates for any reason, the Performance
Incentive Units held by the Participant with respect to
any Performance Award Period which has not ended at the
date of such termination shall become null and void;
provided, however, that the Committee, in its sole
discretion, shall have the right to authorize
proportionate payment in cases of death or retirement
at the normal retirement date or under a formal early
retirement plan or policy of the Company, if the
Committee in its discretion determines a payment to be
appropriate and equitable.
5. MISCELLANEOUS PROVISIONS
5.1 Adjustments Upon Changes in Capitalization.
In the event of changes to the outstanding shares of
Common Stock of the Company through reorganization,
merger, consolidation, recapitalization,
reclassification, stock split-up, stock dividend, stock
consolidation or otherwise, or in the event of a sale
of all or substantially all of the assets of the
Company, an appropriate and proportionate adjustment
shall be made in the number and kind of shares as to
which Stock Options may be granted. A corresponding
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adjustment changing the number or kind of shares and/or
the purchase price per share of unexercised Stock
Options or portions thereof which shall have been
granted prior to any such change shall likewise be
made. Notwithstanding the foregoing, in the case of a
reorganization, merger or consolidation, or sale of all
or substantially all of the assets of the Company, in
lieu of adjustments as aforesaid, the Committee may in
is discretion accelerate the date after which a Stock
Option may or may not be exercised or the stated
expiration date thereof and may accelerate the
termination date of any Performance Award Period then
in effect. Adjustments or changes under this Section
shall be made by the Committee, whose determination as
to what adjustments or changes shall be made, and the
extent thereof, shall be final, binding and conclusive.
5.2 Non-Transferability.
No Stock Option, Stock Appreciation Right or
Performance Incentive Unit granted under the Plan shall
be transferable by the Participant except by will or
the laws of descent and distribution, nor shall any
Stock Option be exercisable during the Participant's
lifetime by any person other than the Participant or
his guardian or legal representative.
5.3 Withholding.
The Company's obligations in connection with this Plan
shall be subject to applicable federal, state and local
tax withholding requirements. Federal, state and local
withholding tax due at the time of a grant or upon the
exercise of any Stock Option may, in the discretion of
the Committee, be paid in shares of Common Stock
already owned by the Participant or through the
withholding of shares otherwise issuable to such
Participant, upon such terms and conditions as the
Committee shall determine. If the Participant shall
either fail to pay, or make arrangements satisfactory
to the Committee for the payment, to the Company of all
such federal, state and local taxes required to be
withheld by the Company, then the Company shall, to the
extent permitted by law, have the right to deduct from
any payment of any kind otherwise due to such
Participant an amount equal to any federal, state or
local taxes of any kind required to be withheld by the
Company.
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5.4 Compliance with Law and Approval of Regulatory Bodies.
No Stock Option, Stock Appreciation Right or
Performance Incentive Unit shall be exercisable and no
shares will be delivered under the Plan except in
compliance with all applicable federal and state laws
and regulations including, without limitation,
compliance with all federal and state securities laws
and withholding tax requirements and with the rules of
NASDAQ and of all domestic stock exchanges on which the
Common Stock may be listed. Any share certificate
issued to evidence shares for which a Stock Option is
exercised may bear legends and statements the Committee
shall deem advisable to assure compliance with federal
and state laws and regulations. No Stock Option, Stock
Appreciation Right or Performance Incentive Unit shall
be exercisable and no shares will be delivered under
the Plan, until the Company has obtained consent or
approval from regulatory bodies, federal or state,
having jurisdiction over such matters as the Committee
may deem advisable. In the case of the exercise of a
Stock Option or Stock Appreciation Right by a person or
estate acquiring the right to exercise the Stock Option
or Stock Appreciation Right as a result of the death of
the Participant, the Committee may require reasonable
evidence as to the ownership of the Stock Option or
Stock Appreciation Right and may require consents and
releases of taxing authorities that it may deem
advisable.
5.5 No Right to Employment.
Neither the adoption of the Plan nor its operation, nor
any document describing or referring to the Plan, or
any part thereof, nor the granting of any Stock
Options, Stock Appreciation Rights or Performance
Incentive Units hereunder, shall confer upon any
Participant under the Plan any right to continue in the
employ of the Company or any Subsidiary, or shall in
any way affect the right and power of the Company or
any Subsidiary to terminate the employment of any
Participant at any time with or without assigning a
reason therefor, to the same extent as might have been
done if the Plan had not been adopted.
5.6 Exclusion from Pension Computations.
By acceptance of a grant of a Stock Option, Stock
Appreciation Right or Performance Incentive Unit under
the Plan, the recipient shall be deemed to agree that
any income realized upon the receipt or exercise
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thereof or upon the disposition of the shares received
upon exercise will not be taken into account as "base
remuneration", "wages", "salary" or "compensation" in
determining the amount of any contribution to or
payment or any other benefit under any pension,
retirement, incentive, profit-sharing or deferred
compensation plan of the Company or any Subsidiary.
5.7 Separability.
If any of the terms of provisions of the Plan conflict
with the requirements of Rule 16b-3, then such terms or
provisions shall be deemed inoperative to the extent
they so conflict with the requirements of Rule 16b-3.
5.8 Interpretation of the Plan.
Headings are given to the Sections of the Plan solely
as a convenience to facilitate reference, such
headings, numbering and paragraphing shall not in any
case be deemed in any way material or relevant to the
construction of the Plan or any provision hereof. The
use of the masculine gender shall also include within
its meaning the feminine. The use of the singular
shall also include within its meaning the plural and
vice versa.
5.9 Use of Proceeds.
Funds received by the Company upon the exercise of
Stock Options granted under the Plan shall be used for
the general corporate purposes of the Company.
5.10 Construction of Plan.
The place of administration of the Plan shall be in the
Commonwealth of Pennsylvania, and the validity,
construction, interpretation, administration and effect
of the Plan and of its rules and regulations, and
rights relating to the Plan, shall be determined solely
in accordance with the laws of the Commonwealth of
Pennsylvania.
Exhibit 10(a) Page
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