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EXHIBIT 99.1
[LOGO OF AVISTA CORP.]
2000 Non-Officer Employee
Long-Term Incentive Plan
Avista Corporation
Adopted by the Board of Directors
May 12, 2000
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AVISTA CORPORATION
2000 NON-OFFICER EMPLOYEE LONG-TERM INCENTIVE PLAN
SECTION 1. PURPOSE
The purpose of the Avista Corporation 2000 Non-Officer Employee Long-Term
Incentive Plan (the "Plan") is to enhance the long-term shareholder value of
Avista Corporation, a Washington corporation (the "Company"), by offering
opportunities to selected persons who are not members of the Board (as defined
in Section 2) or Officers (as defined in Section 2) to participate in the
Company's growth and success, and to encourage them to remain in the service of
the Company and its Subsidiaries (as defined in Section 2) and to acquire and
maintain stock ownership in the Company.
SECTION 2. DEFINITIONS
For purposes of the Plan, the following terms are defined as set forth
below:
2.1 Award
"Award" means an award or grant made to a Participant pursuant to the Plan,
including, without limitation, awards or grants of Options, Stock Appreciation
Rights, Stock Awards, Performance Awards, Other Stock-Based Awards or any
combination of the foregoing (including any Dividend Equivalent Rights granted
in connection with such Awards).
2.2 Board
"Board" means the Board of Directors of the Company.
2.3 Cause
"Cause" means (a) the willful and continued failure of the Holder to
perform substantially the Holder's duties with the Company or one of its
Subsidiaries (other than any such failure resulting from incapacity due to
physical or mental illness) after a written demand for substantial performance
is delivered to the Holder by the Board or the Chief Executive Officer of the
Company which specifically identifies the manner in which the Board or the Chief
Executive Officer believes that the Holder has not substantially performed the
Holder's
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duties; or (b) the willful engaging by the Holder in illegal conduct or gross
misconduct which is materially and demonstrably injurious to the Company.
2.4 Change of Control
"Change of Control" means any of the following events:
(a) The acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a "Person") of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 20% or more of either
(i) the then outstanding shares of Common Stock of the Company
(the "Outstanding Company Common Stock") or
(ii) the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the election of
directors (the "Outstanding Company Voting Securities"); provided, however, that
for purposes of this subsection (a), the following acquisitions shall not
constitute a Change of Control: (i) any acquisition directly from the Company,
(ii) any acquisition by the Company, (iii) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company or (iv) any acquisition by any corporation
pursuant to a transaction which complies with clauses (i), (ii) and (iii) of
subsection (c) of this Section 2.4;
(b) A change in the Board so that individuals who constitute the
Board (the "Incumbent Board") as of the date of adoption of the Plan cease for
any reason to constitute at least a majority of the Board after such date;
provided, however, that any individual becoming a director subsequent to such
date whose election, or nomination for election by the Company's shareholders,
was approved by a vote of at least a majority of the directors then comprising
the Incumbent Board shall be considered as though such individual were a member
of the Incumbent Board, but excluding, for this purpose, any such individual
whose initial assumption of office occurs as a result of an actual or threatened
election contest with respect to the election or removal of directors or other
actual or threatened solicitation of proxies or consents by or on behalf of a
Person other than the Board;
(c) Consummation of a reorganization, merger or consolidation or sale
or other disposition of all or substantially all of the assets of the Company (a
"Business Combination"), in each case, unless, following such Business
Combination, (i) all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the Outstanding Company Common
Stock and Outstanding
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Company Voting Securities immediately prior to such Business Combination
beneficially own, directly or indirectly, more than 50% of, respectively, the
then outstanding shares of Common Stock and the combined voting power of the
then outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of the corporation resulting from such Business
Combination (including, without limitation, a corporation which as a result of
such transaction owns the Company or all or substantially all of the Company's
assets either directly or through one or more subsidiaries) in substantially the
same proportions as their ownership, immediately prior to such Business
Combination of the Outstanding Company Common Stock and Outstanding Company
Voting Securities, as the case may be, (ii) no Person (excluding any corporation
resulting from such Business Combination or any employee benefit plan (or
related trust) of the Company or such corporation resulting from such Business
Combination) beneficially owns, directly or indirectly, 20% or more of,
respectively, the then outstanding shares of Common Stock of the corporation
resulting from such Business Combination or the combined voting power of the
then outstanding voting securities of such corporation except to the extent that
such ownership existed prior to the Business Combination and (iii) at least a
majority of the members of the Board of Directors of the corporation resulting
from such Business Combination were members of the Incumbent Board at the time
of the execution of the initial agreement, or of the action of the Board,
providing for such Business Combination; or
(d) Approval by the shareholders of the Company of a complete
liquidation or dissolution of the Company.
2.5 Code
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
2.6 Common Stock
"Common Stock" means the common stock, no par value, of the Company.
2.7 Disability
"Disability" means "disability" as that term is defined for purposes of the
Company's Long-Term Disability Plan or other similar successor plan applicable
to salaried employees.
2.8 Dividend Equivalent Right
"Dividend Equivalent Right" means an Award granted under Section 12.
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2.9 Early Retirement
"Early Retirement" means early retirement as that term is defined by the
Plan Administrator from time to time for purposes of the Plan.
2.10 Eligible Participant
"Eligible Participant" has the meaning set forth in Section 5.
2.11 Exchange Act
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
2.12 Fair Market Value
The "Fair Market Value" shall be the average of the high and low per share
sales prices for the Common Stock on the New York Stock Exchange as such price
is officially quoted in the composite tape of transactions on such exchange for
a single trading day. If there is no such reported price for the Common Stock
for the date in question, then such price on the last preceding date for which
such price exists shall be determinative of Fair Market Value.
2.13 Good Reason
"Good Reason" means:
(a) The assignment to the Holder of any duties inconsistent in any
respect with the Holder's position (including status, offices, titles and
reporting requirements), authority, duties or responsibilities, or any other
action by the Company which results in a diminution in such position, authority,
duties or responsibilities, excluding for this purpose an isolated,
insubstantial and inadvertent action not taken in bad faith and which is
remedied by the Company promptly after receipt of notice thereof given by the
Holder;
(b) Any failure of the Company to comply with its standard
compensation arrangements with the Holder, including the failure to continue in
effect any material compensation or benefit plan (or the substantial equivalent
thereof) in which the Holder was participating at the time of a Change of
Control, other than an isolated, insubstantial and inadvertent failure not
occurring in bad faith and which is remedied by the Company promptly after
receipt of notice thereof from the Holder;
(c) Any purported termination of the Holder's employment or service
for Cause by the Company that does not comply with the terms of the Plan; or
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(d) The failure of the Company to require that any Successor
Corporation (whether by purchase, merger, consolidation or otherwise) expressly
assume and agree to be bound by the terms of the Plan in the same manner and to
the same extent that the Company would be required to perform if no such
succession had taken place.
2.14 Grant Date
"Grant Date" means the date the Plan Administrator adopted the granting
resolution or a later date designated in a resolution of the Plan Administrator
as the date an Award is to be granted.
2.15 Holder
"Holder" means:
(a) the Participant to whom an Award is granted;
(b) for a Holder who has died, the personal representative of the
Holder's estate, the person(s) to whom the Holder's rights under the Award have
passed by will or by the applicable laws of descent and distribution, or the
beneficiary designated in accordance with Section 13; or
(c) the person(s) to whom an Award has been transferred in accordance
with Section 13.
2.16 Officer
"Officer" means an officer of the Company as defined for purposes of
Section 16(a) of the Exchange Act.
2.17 Option
"Option" means the right to purchase Common Stock granted under Section 7.
An Option is not intended to qualify as an "incentive stock option" as that term
is defined in Section 422 of the Code.
2.18 Other Stock-Based Award
"Other Stock-Based Award" means an Award granted under Section 11.
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2.19 Participant
"Participant" means an individual who is a Holder of an Award or, as the
context may require, any Eligible Participant who has been selected by the Plan
Administrator to participate in the Plan.
2.20 Performance Award
"Performance Award" means an Award granted under Section 10, the payout of
which is subject to achievement through a performance period of performance
goals prescribed by the Plan Administrator.
2.21 Plan Administrator
"Plan Administrator" means the Board or any committee or committees
designated by the Board or any person or persons to whom the Board has delegated
authority to administer the Plan under Section 3.1.
2.22 Restricted Stock
"Restricted Stock" means shares of Common Stock granted under Section 9,
the rights of ownership of which are subject to restrictions prescribed by the
Plan Administrator.
2.23 Retirement
"Retirement" means retirement as of the individual's normal retirement date
under the Company's retirement plan for salaried employees or other similar
successor plan applicable to salaried employees.
2.24 Securities Act
"Securities Act" means the Securities Act of 1933, as amended.
2.25 Stock Appreciation Right
"Stock Appreciation Right" means an Award granted under Section 8.
2.26 Stock Award
"Stock Award" means an Award granted under Section 9.
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2.27 Subsidiary
"Subsidiary" means any entity that is directly or indirectly controlled by
the Company or in which the Company has a significant ownership interest, as
determined by the Plan Administrator, and any entity that may become a direct or
indirect parent of the Company.
2.28 Successor Corporation
"Successor Corporation" has the meaning set forth under Section 14.2.
2.29 Trust and Trustee
"Trust" and "Trustee" have the meanings set forth in Section 3.2.
2.30 Trustee Shares
"Trustee Shares" has the meaning set forth in Section 3.3.
SECTION 3. ADMINISTRATION
3.1 Plan Administrator
The Plan shall be administered by the Board or a committee or committees
(which term includes subcommittees) appointed by, and consisting of two or more
members of, the Board. The Board may delegate the responsibility for
administering the Plan with respect to designated classes of eligible
Participants to different committees consisting of two or more members of the
Board, subject to such limitations as the Board or the Plan Administrator deems
appropriate. Committee members shall serve for such term as the Board may
determine, subject to removal by the Board at any time. To the extent consistent
with applicable law, the Board may authorize one or more senior executive
officers of the Company to grant Awards to designated classes of eligible
employees within the limits prescribed by the Board.
3.2 Administration and Interpretation by the Plan Administrator
Except for the terms and conditions explicitly set forth in the Plan, the
Plan Administrator shall have exclusive authority, in its discretion, to
determine all matters relating to Awards under the Plan, including the selection
of individuals to be granted Awards, the type of Awards, the number of shares of
Common Stock subject to an Award, all terms, conditions, restrictions and
limitations, if any, of an Award and the terms of any instrument that evidences
the Award, and to authorize the Trustee (the "Trustee") of any Trust (the
"Trust") that may be required pursuant to the Plan to
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grant Awards to Participants. The Plan Administrator shall also have exclusive
authority to interpret the Plan and may from time to time adopt, and change,
rules and regulations of general application for the Plan's administration. The
Plan Administrator's interpretation of the Plan and its rules and regulations,
and all actions taken and determinations made by the Plan Administrator pursuant
to the Plan, shall be conclusive and binding on all parties involved or
affected. The Plan Administrator may delegate administrative duties to such of
the Company's officers as it so determines.
3.3 Trust for the Plan
Payments may be, but need not be, made to the Trustee, such payments to be
used by the Trustee to purchase shares of the Common Stock. Shares purchased by
the Trustee pursuant to the terms of the Trust ("Trustee Shares") shall be held
for the benefit of Participants, and shall be distributed to Participants or
their beneficiaries by the Trustee at the direction of the Plan Administrator in
accordance with the terms and conditions of the Awards. Awards may also be made
in units that are redeemable (in whole or in part) in Trustee Shares.
SECTION 4. STOCK SUBJECT TO THE PLAN
4.1 Authorized Number of Shares
Subject to adjustment from time to time as provided in Section 14.1, a
maximum of 2,500,000 shares of Common Stock shall be available for issuance
under the Plan. Shares issued under the Plan shall be drawn from authorized and
unissued shares or shares now held or subsequently acquired by the Company or,
if required by applicable law, shall be purchased by the Trustee on the open
market. In the event a Trust is required, the Company shall not issue any Common
Stock under the Plan to the Trust or to any Participant, nor shall the Company
purchase any Trustee Shares from the Trust.
4.2 Reuse of Shares
Any shares of Common Stock that have been made subject to an Award that
cease to be subject to the Award (other than by reason of exercise or payment of
the Award to the extent it is exercised for or settled in shares) shall again be
available for issuance in connection with future grants of Awards under the
Plan. Shares that are subject to tandem Awards shall be counted only once.
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SECTION 5. ELIGIBILITY
Awards may be granted under the Plan to those employees of the Company and
its Subsidiaries as the Plan Administrator from time to time selects ("Eligible
Participants"); provided, however, that Eligible Participants shall not include
members of the Board and Officers.
SECTION 6. AWARDS
6.1 Form and Grant of Awards
The Plan Administrator shall have the authority, in its sole discretion, to
determine the type or types of Awards to be made under the Plan. Such Awards may
include, but are not limited to, Options, Stock Appreciation Rights, Stock
Awards, Performance Awards, Other Stock-Based Awards and Dividend Equivalent
Rights. Awards may be granted singly, in combination or in tandem so that the
settlement or payment of one automatically reduces or cancels the other. Awards
may also be made in combination or in tandem with, as alternatives to, or as the
payment form for, grants or rights under any other employee or compensation plan
of the Company.
6.2 Acquired Company Awards
Notwithstanding anything in the Plan to the contrary, the Plan
Administrator may grant Awards under the Plan in substitution for awards issued
under other plans, or assume under the Plan awards issued under other plans, if
the other plans are or were plans of other acquired entities ("Acquired
Entities") (or the parent of the Acquired Entity) and the new Award is
substituted, or the old award is assumed, by reason of a merger, consolidation,
acquisition of property or of stock, reorganization or liquidation (the
"Acquisition Transaction"). In the event that a written agreement pursuant to
which the Acquisition Transaction is completed is approved by the Board and said
agreement sets forth the terms and conditions of the substitution for or
assumption of outstanding awards of the Acquired Entity, said terms and
conditions shall be deemed to be the action of the Plan Administrator without
any further action by the Plan Administrator and the persons holding such Awards
shall be deemed to be Participants and Holders.
SECTION 7. AWARDS OF OPTIONS
7.1 Grant of Options
The Plan Administrator is authorized under the Plan, in its sole
discretion, to issue Options.
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7.2 Option Exercise Price
The exercise price for shares purchased under an Option shall be as
determined by the Plan Administrator, but shall not be less than 100% of the
Fair Market Value of the Common Stock on the Grant Date.
7.3 Term of Options
The term of each Option shall be as established by the Plan Administrator
or, if not so established, shall be 10 years from the Grant Date.
7.4 Exercise of Options
The Plan Administrator shall establish and set forth in each instrument
that evidences an Option the time at which or the installments in which the
Option shall vest and become exercisable, which provisions may be waived or
modified by the Plan Administrator at any time. If not so established in the
instrument evidencing the Option, the Option will vest and become exercisable
according to the following schedule, which may be waived or modified by the Plan
Administrator at any time:
Period of Holder's Continuous Percent of Total Option
Employment With The Company Or That Is Vested and
Its Subsidiaries From Option Grant Date Exercisable
After 1 year 25%
After 2 years 50%
After 3 years 75%
After 4 years 100%
Notwithstanding the provisions of Section 7.4 above or of Section 7.6, any
unvested portion of the Option shall vest and become exercisable in full
immediately upon termination of employment for reasons of Disability or death.
To the extent that the right to purchase shares has accrued thereunder, an
Option may be exercised from time to time by written notice to the Company, in
accordance with procedures established by the Plan Administrator, setting forth
the number of shares with respect to which the Option is being exercised and
accompanied by payment in full as described in Section 7.5. The Plan
Administrator may determine at any time that an Option may not be exercised as
to less than 100
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shares at any one time (or the lesser number of remaining shares covered by the
Option).
7.5 Payment of Exercise Price
The exercise price for shares purchased under an Option shall be paid in
full to the Company by delivery of consideration equal to the product of the
Option exercise price and the number of shares purchased. Such consideration
must be paid in cash or by check, or, unless the Plan Administrator in its sole
discretion determines otherwise, either at the time the Option is granted or at
any time before it is exercised, a combination of cash and/or check (if any) and
one or both of the following alternative forms:
(a) tendering (either actually or, if and so long as the Common Stock
is registered under Section 12(b) or 12(g) of the Exchange Act, by attestation)
Common Stock already owned by the Holder for at least six months (or any shorter
period necessary to avoid a charge to the Company's earnings for financial
reporting purposes) having a Fair Market Value on the day prior to the exercise
date equal to the aggregate Option exercise price or
(b) if and so long as the Common Stock is registered under Section
12(b) or 12(g) of the Exchange Act, delivery of a properly executed exercise
notice, together with irrevocable instructions, to
(i) a brokerage firm designated by the Company to deliver
promptly to the Company the aggregate amount of sale or loan proceeds to pay the
Option exercise price and any withholding tax obligations that may arise in
connection with the exercise and
(ii) the Company to deliver the certificates for such purchased
shares directly to such brokerage firm, all in accordance with the regulations
of the Federal Reserve Board.
In addition, to the extent permitted by the Plan Administrator in its sole
discretion, the price for shares purchased under an Option may be paid, either
singly or in combination with one or more of the alternative forms of payment
authorized by this Section 7.5 by (y) a full-recourse promissory note delivered
pursuant to Section 16 or (z) such other consideration as the Plan Administrator
may permit.
7.6 Post-Termination Exercises
The Plan Administrator shall establish and set forth in each instrument
that evidences an Option whether the Option will continue to be exercisable, and
the terms
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and conditions of such exercise, if a Holder ceases to be employed by the
Company or its Subsidiaries, which provisions may be waived or modified by the
Plan Administrator at any time. If not so established in the instrument
evidencing the Option, the Option will be exercisable according to the following
terms and conditions, which may be waived or modified by the Plan Administrator
at any time.
In case of termination of the Holder's employment other than by reason of
death or Cause, the Option shall be exercisable, to the extent of the number of
shares purchasable by the Holder at the date of such termination, only
(a) within one year if the termination of the Holder's employment is
coincident with Retirement, Early Retirement in connection with a Company
program offering early retirement or Disability; or
(b) within three months after the date the Holder ceases to be an
employee of the Company or a Subsidiary if termination of the Holder's
employment is for any reason other than Retirement, Early Retirement in
connection with a Company program offering early retirement or Disability, but
in no event later than the remaining term of the Option. Any Option exercisable
at the time of the Holder's death may be exercised, to the extent of the number
of shares purchasable by the Holder at the date of the Holder's death, by the
personal representative of the Holder's estate, the person(s) to whom the
Holder's rights under the Award have passed by will or the applicable laws of
descent and distribution or the beneficiary designated pursuant to Section 13 at
any time or from time to time within one year after the date of death, but in no
event later than the remaining term of the Option. Any portion of an Option
that is not exercisable on the date of termination of the Holder's employment
shall terminate on such date, unless the Plan Administrator determines
otherwise. In case of termination of the Holder's employment for Cause, the
Option shall automatically terminate upon first notification to the Holder of
such termination, unless the Plan Administrator determines otherwise. If a
Holder's employment with the Company is suspended pending an investigation of
whether the Holder shall be terminated for Cause, all the Holder's rights under
any Option likewise shall be suspended during the period of investigation.
A transfer of employment between or among the Company and its Subsidiaries
shall not be considered a termination of employment for purposes of this Section
7.6. The effect of a Company-approved leave of absence on the terms and
conditions of an Option shall be determined by the Plan Administrator, in its
sole discretion.
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SECTION 8. STOCK APPRECIATION RIGHTS
8.1 Grant of Stock Appreciation Rights
The Plan Administrator may grant a Stock Appreciation Right separately or
in tandem with a related Option.
8.2 Tandem Stock Appreciation Rights
A Stock Appreciation Right granted in tandem with a related Option will
give the Holder the right to surrender to the Company all or a portion of the
related Option and to receive an appreciation distribution (in shares of Common
Stock or cash or any combination of shares and cash, as the Plan Administrator,
in its sole discretion, shall determine at any time) in an amount equal to the
excess of the Fair Market Value for the date the Stock Appreciation Right is
exercised over the exercise price per share of the right, which shall be the
same as the exercise price of the related Option. A tandem Stock Appreciation
Right will have the same other terms and provisions as the related Option. Upon
and to the extent a tandem Stock Appreciation Right is exercised, the related
Option will terminate.
8.3 Stand-Alone Stock Appreciation Rights
A Stock Appreciation Right granted separately and not in tandem with an
Option will give the Holder the right to receive an appreciation distribution
(in shares of Common Stock or cash or any combination of shares and cash, as the
Plan Administrator, in its sole discretion, shall determine at any time) in an
amount equal to the excess of the Fair Market Value for the date the Stock
Appreciation Right is exercised over the exercise price per share of the right.
A stand-alone Stock Appreciation Right will have such terms as the Plan
Administrator may determine, except that the exercise price per share of the
right must be at least equal to 100% of the Fair Market Value on the Grant Date
and the term of the right, if not otherwise established by the Plan
Administrator, shall be 10 years from the Grant Date.
8.4 Exercise of Stock Appreciation Rights
Unless otherwise provided by the Plan Administrator in the instrument that
evidences the Stock Appreciation Right, the provisions of Section 7.6 relating
to the termination of a Holder's employment shall apply equally, to the extent
applicable, to the Holder of a Stock Appreciation Right.
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SECTION 9. STOCK AWARDS
9.1 Grant of Stock Awards
The Plan Administrator is authorized to make Awards of Common Stock to
Participants on such terms and conditions and subject to such restrictions, if
any (which may be based on continuous service with the Company or the
achievement of performance goals, as the Plan Administrator shall determine, in
its sole discretion, which terms, conditions and restrictions shall be set forth
in the instrument evidencing the Award. The terms, conditions and restrictions
that the Plan Administrator shall have the power to determine shall include,
without limitation, the manner in which shares subject to Stock Awards are held
during the periods they are subject to restrictions and the circumstances under
which forfeiture of Restricted Stock shall occur by reason of termination of the
Holder's employment.
9.2 Issuance of Shares
Upon the satisfaction of any terms, conditions and restrictions prescribed
in respect to a Stock Award, or upon the Holder's release from any terms,
conditions and restrictions of a Stock Award, as determined by the Plan
Administrator, the Company shall release, as soon as practicable, to the Holder
or, in the case of the Holder's death, to the personal representative of the
Holder's estate or as the appropriate court directs, the appropriate number of
shares of Common Stock.
9.3 Waiver of Restrictions
Notwithstanding any other provisions of the Plan, the Plan Administrator
may, in its sole discretion, waive the forfeiture period and any other terms,
conditions or restrictions on any Restricted Stock under such circumstances and
subject to such terms and conditions as the Plan Administrator shall deem
appropriate.
SECTION 10. PERFORMANCE AWARDS
10.1 Plan Administrator Authority
Performance Awards may be denominated in cash, shares of Common Stock or
any combination thereof. The Plan Administrator is authorized to grant
Performance Awards and shall determine the nature, length and starting date of
the performance period for each Performance Award and the performance objectives
to be used in valuing Performance Awards and determining the extent to which
such Performance Awards have been earned. Performance objectives and other
terms may vary from Participant to Participant and between groups of
Participants. Performance objectives shall be based on earnings, earnings per
share, profits, profit growth, profit-related return ratios, cost management,
dividend payout ratios, economic value added, cash
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flow or total shareholder return, where such goals may be stated in absolute
terms or relative to comparison companies, as the Plan Administrator shall
determine, in its sole discretion. Performance periods may overlap and
Participants may participate simultaneously with respect to Performance Awards
that are subject to different performance periods and different performance
factors and criteria.
The Plan Administrator shall determine for each Performance Award the range
of dollar values or number of shares of Common Stock (which may, but need not,
be shares of Restricted Stock pursuant to Section 9), or a combination thereof,
to be received by the Participant at the end of the performance period if and to
the extent that the relevant measures of performance for such Performance Awards
are met. The earned portion of a Performance Award may be paid currently or on
a deferred basis with such interest or earnings equivalent as may be determined
by the Plan Administrator. Payment shall be made in the form of cash, whole
shares of Common Stock (which may, but need not, be shares of Restricted Stock
pursuant to Section 9), Options or any combination thereof, either in a single
payment or in annual installments, all as the Plan Administrator shall
determine.
10.2 Adjustment of Awards
The Plan Administrator may adjust the performance goals and measurements
applicable to Performance Awards to take into account changes in law and
accounting rules and to make such adjustments as the Plan Administrator deems
necessary or appropriate to reflect the inclusion or exclusion of the impact of
extraordinary or unusual items, events or circumstances. The Plan Administrator
also may adjust the performance goals and measurements applicable to Performance
Awards and thereby reduce the amount to be received by any Participant pursuant
to such Awards if and to the extent that the Plan Administrator deems it
appropriate.
10.3 Payout Upon Termination
The Plan Administrator shall establish and set forth in each instrument
that evidences a Performance Award whether the Award will be payable, and the
terms and conditions of such payment, if a Holder ceases to be employed by the
Company or its Subsidiaries, which provisions may be waived or modified by the
Plan Administrator at any time. If not so established in the instrument
evidencing the Performance Award, the Award will be payable according to the
following terms and conditions, which may be waived or modified by the Plan
Administrator at any time. If during a performance period a Participant's
employment with the Company terminates by reason of the Participant's
Retirement, Early Retirement at the Company's request, Disability or death, such
Participant shall be entitled to a payment with respect to each outstanding
Performance Award at the end of the applicable
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performance period (a) based, to the extent relevant under the terms of the
Award, on the Participant's performance for the portion of such performance
period ending on the date of termination and (b) prorated for the portion of the
performance period during which the Participant was employed by the Company, all
as determined by the Plan Administrator. The Plan Administrator may provide for
an earlier payment in settlement of such Performance Award discounted at a
reasonable interest rate and otherwise in such amount and under such terms and
conditions as the Plan Administrator deems appropriate.
Except as otherwise provided in Section 14 or in the instrument evidencing
the Performance Award, if during a performance period a Participant's employment
with the Company terminates other than by reason of the Participant's
Retirement, Early Retirement at the Company's request, Disability or death, then
such Participant shall not be entitled to any payment with respect to the
Performance Awards relating to such performance period, unless the Plan
Administrator shall otherwise determine. The provisions of Section 7.6
regarding leaves of absence and termination for Cause shall apply to Performance
Awards.
SECTION 11. OTHER STOCK-BASED AWARDS
The Plan Administrator may grant other Awards under the Plan pursuant to
which shares of Common Stock (which may, but need not, be shares of Restricted
Stock pursuant to Section 9) are or may in the future be acquired, or Awards
denominated in stock units, including ones valued using measures other than
market value. Such Other Stock-Based Awards may be granted alone or in addition
to or in tandem with any Award of any type granted under the Plan and must be
consistent with the Plan's purpose.
SECTION 12. DIVIDEND EQUIVALENT RIGHTS
Any Awards under the Plan may, in the Plan Administrator's discretion, earn
Dividend Equivalent Rights. In respect of any Award that is outstanding on the
dividend record date for Common Stock, the Participant may be credited with an
amount equal to the cash or stock dividends or other distributions that would
have been paid on the shares of Common Stock covered by such Award had such
covered shares been issued and outstanding on such dividend record date. The
Plan Administrator shall establish such rules and procedures governing the
crediting of Dividend Equivalent Rights, including the timing, form of payment
and payment contingencies of such Dividend Equivalent Rights, as it deems are
appropriate or necessary.
SECTION 13. ASSIGNABILITY
No Option, Stock Appreciation Right, Stock Award, Performance Award, Other
Stock-Based Award or Dividend Equivalent Right granted under the Plan may
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be assigned or transferred by the Holder other than by will or by the applicable
laws of descent and distribution, and, during the Holder's lifetime, such Awards
may be exercised only by the Holder or a permitted assignee or transferee of the
Holder (as provided below). Notwithstanding the foregoing, the Plan
Administrator, in its sole discretion, may permit such assignment, transfer and
exercisability and may permit a Holder of such Awards to designate a beneficiary
who may exercise the Award or receive compensation under the Award after the
Holder's death; provided, however, that any Award so assigned or transferred
shall be subject to all the same terms and conditions contained in the
instrument evidencing the Award.
SECTION 14. ADJUSTMENTS
14.1 Adjustment of Shares
In the event that, at any time or from time to time, a stock dividend,
stock split, spin-off, combination or exchange of shares, recapitalization,
merger, consolidation, distribution to shareholders other than a normal cash
dividend or other change in the Company's corporate or capital structure results
in (a) the outstanding shares, or any securities exchanged therefor or received
in their place, being exchanged for a different number or class of securities of
the Company or of any other corporation or (b) new, different or additional
securities of the Company or of any other corporation being received by the
holders of shares of Common Stock of the Company, then the Plan Administrator
shall make proportional adjustments in (i) the maximum number and kind of
securities subject to the Plan as set forth in Section 4.1, and (ii) the number
and kind of securities that are subject to any outstanding Award and the per
share price of such securities, without any change in the aggregate price to be
paid therefor. The determination by the Plan Administrator as to the terms of
any of the foregoing adjustments shall be conclusive and binding.
14.2 Change of Control
Except as otherwise provided in the instrument that evidences the Award, in
the event of any Change of Control, each Award that is at the time outstanding
shall automatically accelerate so that each such Award shall, immediately prior
to the specified effective date for the Change of Control, become 100% vested
and exercisable, except that such acceleration will not occur if, in the opinion
of the Company's outside accountants, it would render unavailable "pooling of
interest" accounting for a Change of Control that would otherwise qualify for
such accounting treatment. Such Award shall not so accelerate, however, if and
to the extent that such Award is, in connection with the Change of Control,
either to be assumed by the successor corporation or parent thereof (the
"Successor Corporation") or to be replaced with a comparable award for the
purchase of shares of the capital stock of
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the Successor Corporation. The determination of Award comparability under clause
(a) above shall be made by the Plan Administrator, and its determination shall
be conclusive and binding. All such Awards shall terminate and cease to remain
outstanding immediately following the consummation of the Change of Control,
except to the extent assumed by the Successor Corporation. Any such Awards that
are assumed or replaced in the Change of Control and do not otherwise accelerate
at that time shall be accelerated in the event that the Holder's employment
should subsequently terminate within three years following such Change of
Control, unless such employment is terminated by the Successor Corporation for
Cause or by the Holder voluntarily without Good Reason.
14.3 Further Adjustment of Awards
Subject to Section 14.2, and subject to the limitations set forth in
Section 10, the Plan Administrator shall have the discretion, exercisable at any
time before a sale, merger, consolidation, reorganization, liquidation or other
corporate transaction, as defined by the Plan Administrator, to take such
further action as it determines to be necessary or advisable, and fair and
equitable to Participants, with respect to Awards. Such authorized action may
include (but shall not be limited to) establishing, amending or waiving the
type, terms, conditions or duration of, or restrictions on, Awards so as to
provide for earlier, later, extended or additional time for exercise, payment or
settlement or lifting restrictions, differing methods for calculating payments
or settlements, alternate forms and amounts of payments and settlements and
other modifications, and the Plan Administrator may take such actions with
respect to all Participants, to certain categories of Participants or only to
individual Participants. The Plan Administrator may take such action before or
after granting Awards to which the action relates and before or after any public
announcement with respect to such sale, merger, consolidation, reorganization,
liquidation or change in control that is the reason for such action.
14.4 Limitations
The grant of Awards will in no way affect the Company's right to adjust,
reclassify, reorganize or otherwise change its capital or business structure or
to merge, consolidate, dissolve, liquidate or sell or transfer all or any part
of its business or assets.
SECTION 15. WITHHOLDING
The Company may require the Holder to pay to the Company the amount of any
withholding taxes that the Company is required to withhold with respect to the
grant, exercise, payment or settlement of any Award. Subject to the Plan and
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applicable law and unless the Plan Administrator determines otherwise, the
Holder may satisfy withholding obligations, in whole or in part, by paying cash,
by electing to have the Company withhold shares of Common Stock (up to the
employer's minimum required federal tax withholding rate) or by transferring
shares of Common Stock to the Company (already owned by the Participant for the
period necessary to avoid a charge to the Company's earnings for financial
reporting purposes), in such amounts as are equivalent to the Fair Market Value
of the withholding obligation. The Company shall have the right to withhold
from any Award or any shares of Common Stock issuable pursuant to an Award or
from any cash amounts otherwise due or to become due from the Company to the
Participant an amount equal to such taxes.
SECTION 16. LOANS, INSTALLMENT PAYMENTS
AND LOAN GUARANTEES
To assist a Holder in acquiring shares of Common Stock pursuant to an Award
granted under the Plan, the Plan Administrator, in its sole discretion, may
authorize, either at the Grant Date or at any time before the acquisition of
Common Stock pursuant to the Award, (a) the extension of a full-recourse loan to
the Holder by the Company or (b) the guarantee by the Company of a full-recourse
loan obtained by the grantee from a third party. The terms of any loans,
installment payments or loan guarantees, including the interest rate and terms
of and security for repayment, will be subject to the Plan Administrator's
discretion. The maximum credit available is the purchase price, if any, of the
Common Stock acquired, plus the maximum federal and state income and employment
tax liability that may be incurred in connection with the acquisition.
SECTION 17. AMENDMENT AND TERMINATION OF PLAN
17.1 Amendment of Plan
The Plan may be amended only by the Board as it shall deem advisable.
17.2 Termination of Plan
The Board may suspend or terminate the Plan at any time. The Plan will
have no fixed expiration date.
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17.3 Consent of Holder
The amendment or termination of the Plan shall not, without the consent of
the Holder of any Award under the Plan, impair or diminish any rights or
obligations under any Award theretofore granted under the Plan.
SECTION 18. GENERAL
18.1 Award Agreements
Awards granted under the Plan shall be evidenced by a written agreement
that shall contain such terms, conditions, limitations and restrictions as the
Plan Administrator shall deem advisable and that are not inconsistent with the
Plan.
18.2 Continued Employment; Rights in Awards
None of the Plan, participation in the Plan as a Participant or any action
of the Plan Administrator taken under the Plan shall be construed as giving any
Participant or employee of the Company any right to be retained in the employ of
the Company or limit the Company's right to terminate the employment of the
Participant.
18.3 Registration
The Company shall be under no obligation to any Participant to register for
offering or resale or to qualify for exemption under the Securities Act, or to
register or qualify under state securities laws, any shares of Common Stock,
security or interest in a security paid or issued under, or created by, the
Plan, or to continue in effect any such registrations or qualifications if made.
The Company may issue certificates for shares with such legends and subject
to such restrictions on transfer and stop-transfer instructions as counsel for
the Company deems necessary or desirable for compliance by the Company with
federal and state securities laws.
Inability of the Company to obtain, from any regulatory body having
jurisdiction, the authority deemed by the Company's counsel to be necessary for
the lawful issuance and sale of any shares hereunder or the unavailability of an
exemption from registration for the issuance and sale of any shares hereunder
shall relieve the Company of any liability in respect of the nonissuance or sale
of such shares as to which such requisite authority shall not have been
obtained.
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18.4 No Rights as a Shareholder
No Award shall entitle the Holder to any cash dividend (except to the
extent provided in an Award of Dividend Equivalent Rights), voting or other
right of a shareholder unless and until the date of issuance under the Plan of
the shares that are the subject of such Award, free of all applicable
restrictions.
18.5 Unfunded Plan
The Plan is intended to constitute an "unfunded" plan. Nothing contained
herein shall require the Company to segregate any monies or other property, or
shares of Common Stock, or to create any trusts, or to make any special deposits
for any immediate or deferred amounts payable to any Participant, and no
Participant shall have any rights that are greater than those of a general
unsecured creditor of the Company.
18.6 Severability
If any provision of the Plan or any Award is determined to be invalid,
illegal or unenforceable in any jurisdiction, or as to any person, or would
disqualify the Plan or any Award under any law deemed applicable by the Plan
Administrator, such provision shall be construed or deemed amended to conform to
applicable laws, or, if it cannot be so construed or deemed amended without, in
the Plan Administrator's determination, materially altering the intent of the
Plan or the Award, such provision shall be stricken as to such jurisdiction,
person or Award, and the remainder of the Plan and any such Award shall remain
in full force and effect.
SECTION 19. EFFECTIVE DATE
The Plan's effective date is the date on which it is adopted by the Board.
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