Exhibit 10.15
ORYX ENERGY COMPANY
1992 LONG-TERM INCENTIVE PLAN
As Amended Through May 1, 1997 and Restated
ARTICLE I
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PURPOSE
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1.1 Purpose. The purpose of the Oryx Energy Company 1992 Long-Term Incentive
Plan (this "Plan'") is to strengthen the ability of Oryx Energy Company (the
"Company") to attract, motivate, and retain employees of superior capability and
to more closely align the interests of management with those of stockholders of
the Company by relating capital accumulation to increases in stockholder value.
ARTICLE II
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GENERAL DEFINITIONS
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2.1 "Agreement" - The written instrument evidencing the grant to a Participant
of an Incentive Award. Each Participant may be issued one or more Agreements
from time to time, containing one or more Incentive Awards, singly, in
combination, or in tandem.
2.2 "Board" - The Board of Directors of the Company.
2.3 "Code" - The Internal Revenue Code of 1986, as amended.
2.4 "Committee" - The Committee that the Board appoints to administer this Plan.
2.5 "Common Stock" - The common stock of the Company as described in the
Company's Certificate of Incorporation, or such other stock as shall be
substituted therefor.
2.6 "Company" - Oryx Energy Company, or any successor to the Company.
2.7 "Contingent Stock Option" - A Stock Option granted under the provisions of
Section-7- 6.
2.8 "Date of Grant" - The date on which the granting of an Incentive Award is
authorized by the Committee, unless another date is specified by the Committee
or by a provision in this Plan applicable to the Incentive Award.
2.9 "Deferred Compensation Stock Option" - A Stock Option granted under the
provisions of Section 7.5 and designated as such.
2.10 "Disposition" -Any sale, transfer, encumbrance, gift, donation, assignment,
pledge, hypothecation, or other disposition, whether similar or dissimilar to
those previously enumerated, whether voluntary or involuntary, and whether
during the Participant's lifetime or upon or after his or her death, including,
but not limited to, any disposition by operation of law, by court order, by
judicial process, or by foreclosure, levy, or attachment.
2.11 "Dividend Equivalent" -The additional amount of Common Stock or cash
credited at the discretion of the Committee in connection with an Incentive
Award, which shall be equal to the cash or Fair Market Value of stock dividends
that would have been paid on the shares of Common Stock covered by such
Incentive Award had such covered Common Stock been issued and outstanding on the
dividend record date, as described in Article XI.
2.12 "Employee" - Any employee (including officers) of the Company or a
Subsidiary.
2.13 "Exchange Act" - The Securities Exchange Act of 1934, as amended.
2.14 "Fair Market Value" - The average of the reported high and low sales price
of the Common Stock (rounded up to the nearest one-eighth of a dollar) on the
date on which Fair Market Value is to be determined (or if there was no reported
sale on such date, the next preceding date on which any reported sale occurred)
on the principal exchange or in such other principal market on which the Common
Stock is trading.
2.15 "Incentive Award" - Any award granted under this Plan.
2.16 "Incentive Stock Option" - A Stock Option intended to satisfy the
requirements of Section 422(b) of the Code.
2.17 "Nonqualified Stock Option" - A Stock Option other than an Incentive Stock
Option, a Deferred Compensation Stock Option, or a Contingent Stock Option.
2.18 "Participant" - A key Employee selected by the Committee to receive an
Incentive Award.
2.19 "Performance Period" - A period of one or more fiscal years of the Company,
beginning with the fiscal year in which Performance Units, Performance Shares or
other performance-based long-term awards are granted, over which performance is
measured, for the purpose of determining the payment value of any such Incentive
Award.
2.20 "Performance Unit" or "Performance Share" - An Incentive Award representing
a contingent right to receive cash or shares of Common Stock (which may be
Restricted Stock) at the end of a Performance Period and which, in the case of
Performance Shares, is denominated in Common Stock, and, in the case of
Performance Units, is denominated in cash values.
2.21 "Restricted Stock" - Shares of Common Stock issued or transferred pursuant
to Article IX.
2.22 "Retirement" - Employment separation on account of early, normal, or late
retirement, as described in the Oryx Energy Company Retirement Plan or any
successor plan thereto.
2.23 "Rule 16b-3" - Rule 16b-3 shall have the meaning assigned in Section 4.1.
2.24 "Securities Act" - The Securities Act of 1933, as amended.
2.25 "Stock Appreciation Right" - The rights specified in Article VIII.
2.26 "Stock Option" - An award of a right or contingent right to purchase Common
Stock pursuant to Article VII.
2.27 "Subsidiary" - A "subsidiary corporation" as defined in Section 424(f) of
the Code that is a subsidiary of the Company.
ARTICLE III
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SHARES OF COMMON STOCK SUBJECT TO THE PLAN
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3.1 Common Stock Authorized. Subject to the provisions of this Article and
Article XIII, the total aggregate number of shares of Common Stock that may be
issued, transferred, or exercised pursuant to Incentive Awards shall not exceed
3,000,000 shares.
3.2 Limitation of Shares. For purposes of the limitations specified in Section
3.1, the following principles apply: (a) a decrease in the -number of shares
that thereafter may be issued or transferred for purpose of Section 3.1 shall
result from (i) the delivery of shares of Common Stock upon exercise of a Stock
Option or Stock Appreciation Right in any manner and (ii) upon the award of
Restricted Stock and (iii) the delivery of shares of Common Stock in settlement
of Dividend Equivalents or Performance Units or Performance Shares; (b) shares
of Common Stock with respect to which Stock Options and Stock Appreciation
Rights expire, are cancelled without being exercised, or are otherwise
terminated may be regranted under this Plan; and (c) if any shares of Common
Stock related to an Incentive Award are not issued or, for any reason, cease to
be issuable or are forfeited such shares of Common Stock shall no longer be
charged against the limitation provided for in Section 3.1 and shall be
available again for the grant of Incentive Awards.
3.3 Shares Available. At the discretion of the Board or the Committee, the
shares of Common Stock to be delivered under this Plan shall be made available
either from authorized and unissued shares of Common Stock or shares of Common
Stock held in the treasury of the Company, or both.
3.4 Incentive Award Adjustments. Subject to the limitations set forth in Article
XV, the Committee may make any adjustment in the exercise price or the number of
shares subject to, or the terms of, a Nonqualified Stock Option, Deferred
Compensation Stock Option, Contingent-Stock--Option, Stock Appreciation Right,
or other stock-based grant pursuant to Section 6.1. Such adjustment shall be
made by amending, substituting or cancelling and regranting an outstanding
Nonqualified Stock Option, Deferred Compensation Stock Option, Contingent Stock
Option, Stock Appreciation Right, or other stock-based grant pursuant to Section
6.1 with the inclusion of terms and conditions that may differ from the terms
and conditions of the original Nonqualified Stock Option, Deferred Compensation
Stock Option, Contingent Stock Option, Stock Appreciation Right, or other
stock-based grant pursuant to Section 6.1. If such action is effected by
amendment, the effective date of such amendment shall be the date of the
original grant.
ARTICLE IV
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ADMINISTRATION OF THE PLAN
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4.1 Committee. This Plan shall be administered by the Committee, which shall
consist of three or more directors of the Company, all of whom are "Non-Employee
Directors," as such term is defined under the rules and regulations adopted,
from time to time, by the Securities and Exchange Commission pursuant to Section
16(b) of the Exchange Act, including specifically but without limitation, Rule
16b-3 or any successor rule thereto. The Committee may, in its discretion,
delegate its duties under this Plan to such agents as it may appoint from time
to time, provided that the Committee may not delegate its duties with respect to
making Incentive Awards to Participants subject to Section 16(b) of the Exchange
Act. The members of the Committee shall serve at the pleasure of the Board,
which shall have the power, at any time and from time to time, to remove members
from the Committee or to add members thereto. Vacancies on the Committee,
however caused, shall be filled by action of the Board.
4.2 Powers. The Committee has discretionary authority to determine the key
Employees to whom, and the time or times at which, Incentive Awards shall be
granted. The Committee also has authority to determine the amount of shares of
Common Stock that shall be subject to each Incentive Award, and the terms,
conditions, and limitations of each Incentive Award, subject to the express
provisions of this Plan. The Committee shall have the discretion to interpret
this Plan and to make all other determinations necessary for Plan
administration. The Committee has authority to prescribe, amend, and rescind any
rules and regulations relating to this Plan, subject to the express provisions
of this Plan. All Committee interpretations, determinations, and actions shall
be in the sole discretion of the Committee and shall be binding on all parties.
The Committee may correct any defect or supply any omission or reconcile any
inconsistency in this Plan or in any Agreement in the manner and to the extent
it shall deem expedient to carry it into effect, and it shall be the sole and
final judge of such expediency.
4.3 Incentive Award Terms. Incentive Awards shall be evidenced by an Agreement
and may include any terms and conditions consistent with this Plan, as the
Committee may determine.
4.4 No Liability. No member of the Board or the Committee shall be liable for
any action or determination made in good faith by the Board or the Committee
with respect to this Plan or any Incentive Award under this Plan.
ARTICLE V
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ELIGIBILITY
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5.1 Participation. Participants shall be selected from the key Employees of the
Company and its Subsidiaries. Such designation may be by individual or by class.
5.2 Incentive Stock Option Eligibility. No person shall be eligible for the
grant of an Incentive Stock Option who owns (within the meaning of Section
422(b) of the Code), or would own immediately before the grant of such Incentive
Stock Option, directly or indirectly, stock possessing more than 10 percent of
the total combined voting power of all classes of stock of the Company or any
Subsidiary. This restriction shall not apply if at the time such Incentive Stock
Option is granted, the Incentive Stock Option exercise price is at least 110
percent of Fair Market Value and the Incentive Stock Option is not, by its
terms, exercisable after the expiration of five years from the Date of Grant.
5.3 No Board Participation. In no event may any member of the Board who is not
an officer or other Employee of the Company or a Subsidiary be granted an
Incentive Award under this Plan.
5.4 Maximum Grants. Notwithstanding any provision contained in this Plan to the
contrary, the maximum number of shares of Common Stock for which Incentive Stock
Options, Nonqualified Stock Options, and Stock Appreciation Rights may be
granted under the Plan to any one Employee for any calendar year is 500,000.
ARTICLE VI
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FORMS OF INCENTIVE AWARDS
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6.1 Incentive Award Eligibility. The forms of Incentive Awards under this Plan
are Stock Options as described in Article VII, Stock Appreciation Rights as
described in Article VIII, Restricted Stock as described in Article IX,
Performance Units or Performance Shares as described in Article X, Dividend
Equivalents as described in Article XI, and other stock-based grants as
described in this Article VI. The Committee may, in its discretion, permit
holders of Incentive Awards under this Plan to surrender outstanding Incentive
Awards in order to exercise or realize the rights under other Incentive Awards,
or in exchange for the grant of new Incentive Awards or require holders of
Incentive Awards to surrender outstanding Incentive Awards as a condition
precedent to the grant of new Incentive Awards. The Committee may grant, from
time to time, to any eligible Employee other stock-based grants. Such other
stock-based grants will either be issued (i) for no consideration other than
services actually rendered (in the case of authorized and unissued shares) or to
be rendered, (ii) for consideration equal to the amount (such as the par value
of such shares) required by applicable law to be received by the Company in
order to assure compliance with applicable state law, or (iii) for consideration
(other than services rendered or to be rendered) equal to or greater than
one-half of the Fair Market Value of the Common Stock covered by such grant on
the Date of Grant. The Committee may specify such criteria. or periods or goals
for payment to the Participant as it shall determine, and the extent to which
such criteria or periods or goals have been met shall be conclusively determined
by the Committee. Other stock-based grants may be paid in shares of Common Stock
or other consideration related to such shares or in a single payment or in
installments as specified by the grant and may be payable on such dates as
determined by the Committee and specified by the grant. The other terms and
conditions of other stock-based grants shall be determined by the Committee.
ARTICLE VII
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STOCK OPTIONS
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7.1 Exercise Price. The exercise price of Common Stock under each Stock Option
shall be determined by the Committee at the time of grant; provided that, the
exercise price of Common Stock under a Stock Option other than a Deferred
Compensation Stock Option or a Contingent Stock Option shall be at least equal
to 100 percent of the Fair Market Value of the Common Stock on the Date of
Grant, provided further that the exercise price of Common Stock under a Deferred
Compensation Stock Option and a Contingent Stock Option shall be determined as
set forth in Section 6.1 with respect to other stock-based grants.
7.2 Term. Stock Options may be exercised as determined by the Committee,
provided that Incentive Stock Options may in no event be exercised later than 10
years from the Date of Grant or granted later than 10 years from the date of
adoption of this Plan. During the Participant's lifetime, only the Participant
may exercise an Incentive Stock Option. The Committee may amend the terms of an
Incentive Stock Option at any time to include provisions that have the effect of
changing such Incentive Stock Option to a Nonqualified Stock Option, or
vice-versa (to the extent any such change is permitted by applicable law).
7.3 Method of Exercise. Upon the exercise of a Stock Option, the exercise price
shall be payable in full in cash or an equivalent acceptable to the Committee.
No fractional shares shall be issued pursuant to the exercise of a Stock Option,
and no payment shall be made in lieu of fractional shares. At the discretion of
the Committee and provided such payment can be effected without causing the
Participant to incur liability under Section 16(b) of the Exchange Act, the
exercise price may be paid by assigning and delivering to the Company shares of
Common Stock or a combination of cash and such shares equal in value to the
exercise price. Any shares so assigned and delivered to the Company in payment
or partial payment of the exercise price shall be valued at Fair Market Value on
the exercise date.
In addition, at the request of the Participant and to the extent permitted by
applicable law, the Company in its discretion may selectively approve
arrangements with a brokerage firm under which such brokerage firm, on behalf of
the Participant, shall pay to the Company the exercise price of the Stock
Options being exercised, and the Company, pursuant to an irrevocable notice from
the Participant, shall promptly deliver the shares being purchased to such firm.
At the discretion, of the Committee, the Participant may be granted by
Agreement, Stock Options to purchase an additional number of shares equal to the
number of shares used by the Participant to pay all or a portion of the exercise
price of other Stock Options or the tax required to be withheld pursuant to the
exercise of such Stock Options, or such additional shares of Common Stock as
shall be authorized by the Committee.
7.4 Limitation on Incentive Stock Options. With respect to Incentive Stock
Options, the aggregate Fair Market Value (determined at the Date of Grant) of
the Common Stock with respect to which Incentive Stock Options are exercisable
for the first time by a Participant during any calendar year (under all stock
option plans of the Company and its Subsidiaries) shall not exceed $100,000, or
such other amount as may be prescribed under the Code or applicable regulations
or rulings from time to time.
7.5 Deferred Compensation Stock Options. A Deferred Compensation Stock Option is
intended to provide a means by which compensation payments can be deferred to
future dates. The Committee shall determine the amount of any compensation
payments to be deferred. The number of shares of Common Stock subject to a
Deferred Compensation Stock Option shall be determined by the Committee, in
accordance with the following formula:
Amount of Compensation to be Deferred
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Fair Market Value on Date of Grant minus
Exercise Price of Options = Number of Shares
Amounts of compensation so deferred may include amounts earned under Incentive
Awards or under any other compensation plan, program, or arrangement of the
Company, as determined by the Committee. A Deferred Compensation Stock Option
shall be granted only if the Committee has reasonably determined that the
recipient of such Deferred Compensation Stock Option will not be deemed at the
Date of Grant to be in receipt of the amount of income being deferred for
purposes of the Code. The shares of Common Stock purchasable under an Agreement
evidencing the grant of a Deferred Compensation Stock Option shall be in lieu of
the compensation so deferred unless otherwise specified by the Committee.
7.6 Contingent Stock Options. In connection with the grant of an Incentive
Award, the exercise of which is dependent upon satisfaction of performance
criteria, the Committee may award a Contingent Stock Option that is to be
exercisable only if the conditions under which such related Incentive Award
becomes payable are not achieved. The number of Contingent Stock Options granted
may be more than or less than or equal to the number of shares subject to such
related Incentive Award. The Contingent Stock Options shall remain in effect as
long as the related Incentive Award remains in effect and shall be subject to
the same provisions for termination or acceleration. If the conditions for
paying the Incentive Awards are not achieved, the Incentive Award shall be
cancelled and the Contingent Stock Options shall be exercisable in accordance
with the terms prescribed by the Committee.
ARTICLE VIII
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STOCK APPRECIATION RIGHTS
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8.1 Grant. The grant of Stock Appreciation Rights under this Plan shall be
subject to the terms and conditions of this Article VIII and shall contain such
additional terms and conditions, not inconsistent with the express provisions of
this Plan, as the Committee shall deem desirable. A Stock Appreciation Right is
an Incentive Award entitling a Participant to receive an amount equal to (or if
the Committee shall determine at the time of grant, less than) the excess of the
Fair Market Value of a share of Common Stock on the date of exercise of the
Stock Appreciation Right over the Fair Market Value of a share of Common Stock
on the Date of Grant of such Stock Appreciation Right, or such other price as
set by the Committee, multiplied by the number of shares of Common Stock with
respect to which the Stock Appreciation Right shall have been exercised. A Stock
Appreciation Right may be granted to a Participant in connection with a Stock
Option, whether in tandem or not, and either at the time of grant or at any time
during the term of the Stock Option, or without relation to a Stock Option.
8.2 Alternate Appreciation Rights. An Alternate Appreciation Right is a Stock
Appreciation Right granted in tandem with a Stock Option that requires the
Participant, upon exercise, to surrender such Stock Option with respect to the
number of shares as to which such Stock Appreciation Right is exercised, and
shall entitle the Participant to receive payment of an amount computed pursuant
to Section 8.1. Such Stock Option shall then cease to be exercisable to the
extent surrendered.
8.3 Limitation on Exercise. Subject to Article XIII, a Stock Appreciation Right
granted in connection with a Stock Option shall be exercisable at such time or
times and only to the extent that the related Stock Option is exercisable, and
shall not be transferable except to the extent that such related Stock Option is
transferable. The Committee may also provide that a Stock Appreciation Right
shall be automatically exercised on one or more specified dates.
8.4 Payment. Payment of the amount determined under Section 8.1 may, in the
discretion of the Committee, be made solely in whole shares of Common Stock
valued at Fair Market Value on the date of exercise of the Stock Appreciation
Right or, alternatively, solely in cash or a combination of cash and Common
Stock, or deferred through the grant of a Deferred Compensation Stock Option.
Exercise of a Stock Appreciation Right for cash shall be made only during such
periods as may be permissible without causing the Participant to incur liability
under Section 16(b) of the Exchange Act. If the Committee decides to make full
payment in shares of Common Stock and the amount payable results in a fractional
share, payment for the fractional share shall be made in cash.
8.5 Limited Rights. A Limited Right is a Stock Appreciation Right that is
effective only upon a Change in Control (as defined in Section 13.2) and is
payable only in cash. The amount of payment to which any grantee of such a
Limited Right shall be entitled upon exercise shall be equal to the difference
between the exercise price per share of any Common Stock covered by a Stock
Option in connection with, whether or not in tandem, such Limited Right and the
"market price" of a share of Common Stock. For purposes of this Section 8.5, the
term "market price" shall mean the greater of (i) the highest price per share of
Common Stock paid in connection with the Change in Control and (ii) the highest
price per share of Common Stock reflected in the NYSE Transactions Report during
the sixty-day period prior to the Change in Control. If the Limited Rights are
exercised, the tandem Stock Options and any tandem Stock Appreciation Rights
other than under this Section 8.5 shall cease to be exercisable to the extent of
the Common Stock with respect to which such Limited Rights are exercised.
ARTICLE IX
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RESTRICTED STOCK
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9.1 Grant. Shares of Restricted Stock maybe awarded under this Plan on such
terms and conditions and with such restrictions as the Committee may from time
to time approve. If a person is awarded shares of Restricted Stock, the person
shall be the record owner of such shares and shall have all the rights of a
stockholder with respect to such shares (unless the escrow agreement, if any,
referred to in Section 9.2 provides otherwise), including the right to vote and
to receive dividends or other distributions with respect thereto. Such
Restricted Stock shall be awarded for no cash or such cash as the Committee
shall determine; provided, however, that unless the shares awarded as Restricted
Stock are shares that have been reacquired by the Company as treasury shares,
Restricted Stock shall be awarded only for services actually rendered, as
determined by the Committee. Restricted Stock awards may be granted alone, in
addition to, or in tandem with, other Incentive Awards. Subject to the terms of
this Plan, the Committee shall determine the number of shares of Restricted
Stock to be awarded to a Participant.
9.2 Restriction Conditions. All shares of Restricted Stock awarded pursuant to
this Plan shall be subject to the following conditions:
(a) The shares may not be the subject of any Disposition (other than by
will or the laws of descent and distribution) until the restrictions are
removed or expire. Any attempted Disposition in violation of this
provision shall be void and ineffective for all purposes.
(b) Each Participant receiving a Restricted Stock award shall be issued a
stock certificate in respect of such shares of Common Stock. Such
certificate shall be registered in the name of such Participant, and each
such certificate shall bear a legend making appropriate reference to the
restrictions imposed.
(c) The Committee may require, as a condition to any award of Restricted
Stock, one or more of the following: that the Company retain physical
custody of the certificate or certificates representing Restricted Stock
during the restriction period; and that the Participant enter into an
escrow agreement providing that the certificate or certificates
representing Restricted Stock shall remain in the physical custody of an
escrow holder until all restrictions are removed or expire, and/or that
the Participant deliver a stock power duly endorsed in blank relating to
the Restricted Stock. The Company may issue shares of Restricted Stock
subject to stop transfer restrictions or may issue such shares subject
only to the restrictive legend described in this Section.
(d) If for any reason, the restrictions imposed by the Committee upon
Restricted Stock are not satisfied at the end of the restriction period,
for any reason, any Restricted Stock remaining subject to such
restrictions shall thereupon be forfeited by the Participant and
transferred to and reacquired by the Company at no cost to the Company.
(e) The Committee may impose other conditions on any shares of Restricted
Stock awarded pursuant to this Plan as it may deem advisable, including,
without limitation, restrictions deemed necessary or advisable by the
Committee to ensure compliance with the Securities Act, the requirements
of any securities exchange upon which such shares or shares of the same
class are then listed, and any state securities law applicable to such
shares.
9.3 Lapse. The restrictions imposed by the Committee pursuant to this Article IX
upon Restricted Stock awards shall lapse as determined by the Committee, subject
to the provisions of Articles XII and XIII. Each Restricted Stock award may have
a different restriction period, in the discretion of the Committee. The
Committee may, in its discretion, prospectively change the restriction period
applicable to a particular Restricted Stock award.
ARTICLE X
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PERFORMANCE UNITS OR PERFORMANCE SHARES
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10.1 Grants. The Committee may grant Performance Units or Performance Shares on
the basis of either Company performance criteria or continued employment with
the Company by a Participant. The Performance Periods for separate grants may
run concurrently. For each Performance Period the Committee shall establish the
number of Performance Units or Performance Shares and the contingent value of
any Performance Unit or Performance Shares relating thereto.
10.2 Company Performance. At the beginning of each Performance Period for grants
based on Company performance, the Committee shall: (i) establish for such
Performance Period specific financial or other performance objectives which may
be absolute or relative to performance, the industry or a group of peer
companies as the Committee believes are relevant to the Company's overall
business objectives; (ii) determine the value of a Performance Unit or the
number of Performance Shares relative to performance objectives; and (iii)
notify each Participant in writing of the terms and conditions of the grant.
If the Committee determines in its sole discretion that the established
performance measures or objectives are no longer suitable to Company objectives
because of a change in the Company's business, operations, corporate structure,
capital structure, or other conditions the Committee deems to be appropriate,
the Committee may modify the performance measures and objectives as considered
appropriate.
If minimum performance is not achieved or exceeded for a Performance Period, no
payment shall be made and all contingent rights shall cease. If minimum
performance is achieved or exceeded, the value of a Performance Unit or
Performance Share shall be based on the degree to which actual performance
exceeded the preestablished minimum performance standards, as determined by the
Committee hereunder. The amount of payment shall be determined by multiplying
the number of Performance Units or Performance Shares granted at the beginning
of the Performance Period times the final Performance Unit or Performance Share
value.
10.3 Continued Employment. At the beginning of each Performance Period for
grants based on continued employment with the Company, the Committee shall: (i)
establish the duration of the Performance Period, which shall be the period of
time during which the Participant must remain employed by the Company in order
to receive payment; (ii) determine the value of a Performance Unit or the number
of Performance Shares relative to such continued employment; and (iii) notify
each Participant in writing of the terms and conditions of the grant.
Subject to Articles XII and XIII hereof, the rights of a Participant under an
employment-based grant of Performance Units or Performance Shares shall
automatically terminate upon termination of the Participant's employment with
the Company prior to the end of the applicable Performance Period, and in that
event the Participant shall not be entitled to receive any payment in respect
thereof.
10.4 Payments. In the discretion of the Committee, payments shall be made in
cash or Common Stock or a combination thereof following the close of the
applicable Performance Period, in such manner as may be permissible without
causing the Participant to incur liability under Section 16(b) of the Exchange
Act.
ARTICLE XI
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DIVIDEND EQUIVALENTS
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11.1 Grant. A recipient of an Incentive Award (other than Restricted Stock) may
also be granted at no additional cost Dividend Equivalents based on the
dividends declared on the Common Stock on record dates during the period between
the Date of Grant and the date of exercise or payment, as applicable. Such
Dividend Equivalents shall be converted to additional shares of Common Stock as
follows:
(Number of shares or units under the
Incentive Award) X (Dividend per share)
Number of Dividend = -------------------------------------------
Equivalent Shares Fair Market Value per share of Common
Stock at corresponding dividend record date
The Dividend Equivalents earned with respect to an Incentive Award shall be
distributed to the Participant (or his successor in interest) in the form of
shares of Common Stock or units denominated in Common Stock, or an equivalent
amount of cash, as the Committee shall determine, and at such time or times as
the Committee shall determine. Dividend Equivalents shall be computed, as of
each dividend record date, both with respect to the number of shares or units
under the Incentive Award and with respect to the number of Dividend Equivalent
shares or Dividend Equivalent units previously earned by the Participant (or his
successor in interest) and not issued during the period prior to the dividend
record date.
ARTICLE XII
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FORFEITURE AND EXPIRATION OF INCENTIVE AWARDS
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12.1 Termination. Subject to the express provisions of this Plan and the terms
of any applicable Agreement, the Committee, in its discretion, may provide for
the forfeiture or continuation of any Incentive Award for such period and upon
such terms and conditions as are determined by the Committee in the event that a
Participant ceases to be an employee. In the absence of Committee action or
contrary provisions in an Agreement, the following rules shall apply:
(a) if an Employee ceases to be an Employee for any reason, the Dividend
Equivalents and/or other stock-based grants pursuant to Section 6.1 held
by such Participant shall terminate and be forfeited as of the date of
employment separation;
(b) if a holder of Restricted Stock or Performance Shares or Performance
Units ceases to be an Employee because of Retirement, death, or permanent
and total disability, such holder shall be entitled to receive his
Restricted Stock free of restriction or shares of Common Stock or cash
subject to such Performance Shares or Performance Units upon the
satisfaction of the applicable criteria, after adjusting the Restricted
Stock, Performance Shares or Performance Units by multiplying the number
of shares subject to the Restricted Stock, Performance Shares or
Performance Units by a fraction, the numerator of which shall be the
number of full and partial calendar months between the date of the
Restricted Stock, Performance Share or Performance Unit award and the
date of employment separation, and the denominator of which shall be the
number of full and partial calendar months from the date of such award to
the end of the applicable restriction period; in the event of separation
of employment for any other reason, the grant of Performance Shares or
Performance Units shall terminate and be forfeited and the Restricted
Stock shall be forfeited by such person and transferred to, and
reacquired by, the Company or a Subsidiary at no cost to the Company or
the Subsidiary;
(c) with respect to Stock Options, in the event of Retirement or
permanent and total disability, Stock Options will become fully vested,
but no Stock Options may be exercised after 36 months (12 months in the
case of Incentive Stock Options) following the date of Retirement or
permanent and total disability; in the event of death, Stock Options
exercisable at the time of death by the Participant may be exercised by
the estate or beneficiary of such Participant until the expiration of the
earlier of the remaining term of such Stock Options or one year from the
date of death; and, in the event of separation of employment for any
other reason, the Stock Options shall continue to vest according to the
original schedule, but shall terminate and be forfeited after six months
from the date of separation of employment; and
(d) with respect to Stock Appreciation Rights, in the event of Retirement
or permanent and total disability, the Stock Appreciation Rights shall
continue in effect for six months following separation of employment, and
such Stock Appreciation Rights may be exercised during such six-month
period; in the event of death or separation of employment for any other
reason, the Stock Appreciation Rights shall terminate; provided that,
Limited Rights pursuant to Section 8.5 may be exercised in accordance
with their terms by the holder thereof who separated from employment
following a Change in Control, without respect to the separation of
employment of such holder.
12.2 Leave of Absence. With respect to an Incentive Award, the Committee may, in
its sole discretion, determine that any Participant who is on leave of absence
for any reason shall be considered to still be in the employ of the Company,
provided that rights to such Incentive Award during a leave of absence shall be
limited to the extent to which such rights were earned or vested when such leave
of absence began.
ARTICLE XIII
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ADJUSTMENT PROVISIONS
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13.1 Share Adjustments. If the number of outstanding shares of Common Stock are
increased, decreased, or exchanged for a different number or kind of shares or
other securities, or if additional, new, or different shares or other securities
are distributed with respect to such shares of Common Stock or other securities
through merger, consolidation, sale of all or substantially all of the assets of
the Company, reorganization, recapitalization, reclassification, stock dividend,
stock split, reverse stock split, or other distribution with respect to such
shares of Common Stock or other securities, an appropriate adjustment in order
to preserve the benefits or potential benefits intended to be made available to
the Participants may be made, in the discretion of the Committee, in all or any
of the following: (i) the maximum number and kind of shares provided in Section
3.1; (ii) the number and kind of shares or other securities subject to then
outstanding Incentive Awards; and (iii) the price for each share or other unit
of any other securities subject to then outstanding Incentive Awards. The
Committee may also make any other adjustments, or take such action, as the
Committee, in its discretion, deems appropriate in order to preserve the
benefits or potential benefits intended to be made available to the
Participants. Any fractional share resulting from such adjustment may be
eliminated.
13.2 Corporate Changes. Subject to Article XV, upon (i) the dissolution or
liquidation of the Company; (ii) a reorganization, merger, or consolidation
(other than a merger or consolidation effecting a reincorporation of the Company
in another state or any other merger or consolidation in which the shareholders
of the surviving corporation and their proportionate interests therein
immediately after the merger or consolidation are substantially identical to the
shareholders of the Company and their proportionate interests therein
immediately prior to the merger or consolidation) of the Company with one or
more corporations, following which the Company is not the surviving corporation
(or survives only as a subsidiary of another corporation in a transaction in
which the shareholders of the parent of the Company and their proportionate
interests therein immediately after the transaction are not substantially
identical to the shareholders of the Company and their proportionate interests
therein immediately prior to the transaction); (iii) the sale of all or
substantially all of the assets of the Company; or (iv) the occurrence of a
Change in Control, subject to the terms of any applicable Agreement, the
Committee serving prior to the date of the applicable event may, to the extent
permitted in Section 3.1 of this Plan, in its discretion, without obtaining
shareholder approval, take any one or more of the following actions with respect
to any Participant:
(a) Accelerate the exercise dates of any or all outstanding Incentive
Awards;
(b) Accelerate the restriction lapse period of any Restricted Stock
subject to restrictions;
(c) Grant Stock Appreciation Rights to holders of outstanding Stock
Options;
(d) Pay cash to any or all holders of Stock Options in exchange for the
cancellation of their outstanding Stock Options;
(e) Make payment for any outstanding Performance Units or Performance
Shares based on such amounts as the Committee may determine;
(f) Grant new Incentive Awards to any Participants;
(g) Grant additional Dividend Equivalents; or
(h) Make any other adjustments or amendments to outstanding Incentive
Awards or determine that there shall be substitution of new Incentive
Awards by such successor employer corporation or a parent or subsidiary
company thereof, with appropriate adjustments as to the number and kind
of shares or units subject to such awards and prices.
A "Change in Control" shall be deemed to have occurred for purposes of this
Plan, if (a) individuals who were directors of the Company immediately prior to
a "Control Transaction" shall cease, within one year of such Control
Transaction, to constitute a majority of the Board of Directors of any successor
to the Company or to a company which has acquired all or substantially all of
its assets or (b) any entity, person, or "Group" acquires shares of the Company
in a transaction or series of transactions that result in such entity, person,
or Group directly or indirectly owning beneficially 50 percent or more of the
outstanding shares of Common Stock of the Company. As used in this Section 13.2,
the term "Control Transaction" shall mean (a) any tender offer for or
acquisition of capital stock of the Company, (b) any merger, consolidation, or
sale of all or substantially all of the assets of the Company, (c) any contested
election of directors of the Company, or (d) any combination of the foregoing
that results in a change in voting power sufficient to elect a majority of the
Board. As used in this Section 13.2, the term "Group" shall mean persons who act
"in concert" as described in Sections 13(d)(3) and/or 14(d)(2) of the Exchange
Act.
13.3 Binding Determination. Adjustments under Sections 13.1 and 13.2 shall be
made by the Committee, and its determination as to what adjustments shall be
made and the extent thereof shall be final, binding, and conclusive.
ARTICLE XIV
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GENERAL PROVISIONS
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14.1 No Right to Employment. Nothing in this Plan or in any instrument executed
pursuant to this Plan shall confer upon any Participant any right to continue in
the employ of the Company or a Subsidiary or affect the Company's or a
Subsidiary's right to terminate the employment of any Participant at any time
with or without cause.
14.2 Securities Requirements. No shares of Common Stock shall be issued or
transferred pursuant to an Incentive Award unless all applicable requirements
imposed by federal and state laws, regulatory agencies, and securities exchanges
upon which the Common Stock may be listed have been fully complied with. As a
condition precedent to the issuance of shares pursuant to the grant or exercise
of an Incentive Award, the Company may require the Participant to take any
reasonable action to meet such requirements.
14.3 No Right to Stock. No Participant and no beneficiary or other person
claiming under or through such Participant shall have any right, title, or
interest in any shares of Common Stock allocated or reserved under this Plan or
subject to any Incentive Award except as to such shares of Common Stock, if any,
that have been issued or transferred to such Participant.
14.4 Withholding. The Company or a Subsidiary, as appropriate, shall have the
right to deduct from all Incentive Awards paid in cash any federal, state, or
local taxes as required by law to be withheld with respect to such cash
payments. In the case of Incentive Awards paid in Common Stock, the Participant
or other person receiving such Common Stock may be required to pay to the
Company or a Subsidiary, as appropriate, the amount of any such taxes which the
Company or Subsidiary is required to withhold with respect to such Common Stock.
Also, at the discretion of the Committee and provided such withholding can be
effected without causing the participant to incur liability under Section 16(b)
of the Exchange Act, the Participant may (i) direct the Company or Subsidiary to
withhold from the shares of Common Stock to be issued or transferred to the
Participant the number of shares necessary to satisfy the Company's or
Subsidiary's obligation to withhold taxes, such determination to be based on the
shares' Fair Market Value as of the date on which tax withholding is to be made,
(ii) deliver sufficient shares of Common Stock (based upon the Fair Market Value
at the date of withholding) to satisfy the withholding obligations, or (iii)
deliver sufficient cash to satisfy the withholding obligations. Participants who
elect to use such a stock withholding feature must make the election at the time
and in the manner prescribed by the Committee.
14.5 No Disposition. No Incentive Award and no right under this Plan, contingent
or otherwise, may be the subject of any Disposition (excluding shares of Common
Stock with respect to which all restrictions have lapsed), other than by will or
the laws of descent or distribution or pursuant to a qualified domestic
relations order as defined by the Code or Title T of the Employee Retirement
Income Security Act, or the rules thereunder. Any attempted Disposition in
violation of this provision shall be void and ineffective for all purposes.
14.6 Severability; Construction. If any provision of this Plan is held to be
illegal or invalid for any reason, then the illegality or invalidity shall not
affect the remaining provisions hereof, but such provision shall be fully
severable and this Plan shall be construed and enforced as if the illegal or
invalid provision had never been included herein. Headings and subheadings are
for convenience only and not to be conclusive with respect to construction of
this Plan.
14.7 Governing Law. All questions arising with respect to the provisions of this
Plan shall be determined by application of the laws of the State of Delaware,
except as may be required by applicable federal law.
14.8 Other Deferrals. The Committee may permit selected Participants to elect to
defer payment of Incentive Awards other than Deferred Compensation Stock Options
in accordance with procedures established by the Committee including, without
limitation, procedures intended to defer taxation on such deferrals until
receipt (including procedures designed to avoid incurrence of liability under
Section 16(b) of the Exchange Act). Any deferred payment, whether elected by the
Participant or specified by an Agreement or by the Committee may require
forfeiture in accordance with stated events, as determined by the Committee. The
Committee may also establish rules and procedures for crediting interest on
deferred cash payments and Dividend Equivalents for deferred payments
denominated in Common Stock or units based on Common Stock values.
ARTICLE XV
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AMENDMENT AND TERMINATION
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15.1 Amendments; Suspension: Termination. The Board may at any time amend,
suspend (and if suspended, may reinstate) or terminate this Plan; provided,
however, that after the stockholders have approved this Plan in accordance with
Section 16.1, the Board may not, without approval of the stockholders of the
Company, amend this Plan so as to (a) increase the number of shares of Common
Stock subject to this Plan except as permitted in Article XIII, (b) reduce the
option price for shares of Common Stock covered by Stock Options granted
hereunder below the applicable price specified in Section 5.2 or Article VI or
VII of this Plan or (c) accelerate the date when Incentive Awards can first be
granted under this Plan as provided in Section 16.2; and provided further, that
the Board may not modify, impair or cancel any outstanding Incentive Award
without the consent of the affected Participant.
ARTICLE XVI
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DATE OF PLAN ADOPTION AND EFFECTIVE DATE FOR INCENTIVE AWARDS
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16.1 Date of Plan Adoption. This Plan has been adopted by the Board on February
7, 1991, subject to stockholder approval. If the requisite stockholder approval
is not obtained, then the Plan shall become null and void and of no further
force or effect. This Plan shall continue in effect with respect to Incentive
Awards granted before termination of this Plan and until such Incentive Awards
have been settled, terminated or forfeited.
16.2 Effective Date for Incentive Awards. Notwithstanding anything contained in
this Plan to the contrary, no Incentive Award shall be granted under this Plan
prior to January 1, 1992.