SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
(No. ______________)
Filed by the Registrant /X/
Filed by a party other than the Registrant / /
Check the appropriate box:
/ / Preliminary proxy statement
/ / Confidential, for use of the Commission only (as permitted by
Rule 14a-6(e)(2))
/X/ Definitive proxy statement
/ / Definitive additional materials
/ / Soliciting material pursuant to Sec. 240.14a-11(c) or Sec. 240.14a-12
Del Webb Corporation
------------------------------------------------
(Name of Registrant as Specified in Its Charter)
------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) or Schedule 14A
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transactions applies:
----------------------------------------------------------------------------
(2) Aggregate number of securities to which transactions applies:
----------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing
fee is calculated and state how it was determined):
----------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
----------------------------------------------------------------------------
(5) Total fee paid:
----------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amount previously paid:
----------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
----------------------------------------------------------------------------
(3) Filing party:
----------------------------------------------------------------------------
(4) Date filed:
----------------------------------------------------------------------------
<PAGE>
DEL WEBB CORPORATION
PHOENIX, ARIZONA
----------
ANNUAL MEETING OF SHAREHOLDERS
----------
NOVEMBER 8, 1995
----------
NOTICE AND PROXY STATEMENT
----------
<PAGE>
DEL WEBB CORPORATION
----------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
AND PROXY STATEMENT
NOVEMBER 8, 1995
----------
NOTICE IS HEREBY GIVEN that the Annual Meeting of the Shareholders (the
"Annual Meeting") of DEL WEBB CORPORATION, a Delaware corporation (the
"Company"), will be held at the Four Seasons Hotel, 98 San Jacinto Boulevard,
Austin, Texas 78701, on Wednesday, November 8, 1995, at 9:00 a.m., Central
Standard Time, for the purposes of:
1. Electing four Class II Directors for three-year terms expiring at the
Annual Meeting of Shareholders to be held in 1998 or until their
successors have been duly elected and qualified;
2. Approving the Del Webb Corporation 1995 Director Stock Plan;
3. Approving the Del Webb Corporation 1995 Executive Long-Term Incentive
Plan;
4. Approving the Del Webb Corporation 1995 Executive Management Incentive
Plan;
5. Ratifying the appointment of KPMG Peat Marwick LLP as the principal
independent public accounting firm of the Company for the year ending June
30, 1996; and
6. Transacting such other business as may properly come before the Annual
Meeting.
The Board of Directors has fixed the close of business on September 11, 1995
as the Record Date for Shareholders entitled to notice of and to vote at the
Annual Meeting and any adjournments thereof.
IN ORDER THAT ADEQUATE PREPARATIONS MAY BE MADE FOR THE ANNUAL MEETING,
PLEASE MARK YOUR PROXY IF YOU WISH TO ATTEND. A MEETING ATTENDANCE CARD THEN
WILL BE MAILED TO YOU PROMPTLY TO FACILITATE YOUR ATTENDANCE.
WHETHER OR NOT YOU INTEND TO BE PRESENT AT THE ANNUAL MEETING, PLEASE MARK,
SIGN AND DATE THE ENCLOSED PROXY AND MAIL IT IN THE ACCOMPANYING ENVELOPE. THE
PROXY MAY BE REVOKED AT ANY TIME PRIOR TO THE ANNUAL MEETING BY WRITTEN REQUEST
TO THE SECRETARY OF THE COMPANY, BY VOTING IN PERSON AT THE ANNUAL MEETING, OR
BY SUBMITTING A LATER DATED PROXY.
On Behalf of the Board of Directors
DONALD V. MICKUS
Vice President, Secretary
and Treasurer
Phoenix, Arizona
Dated: September 22, 1995
<PAGE>
DEL WEBB CORPORATION
6001 NORTH 24TH STREET
PHOENIX, ARIZONA 85016
602-808-8000
----------
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON NOVEMBER 8, 1995
----------
SOLICITATION OF PROXY
This Proxy Statement has been prepared in connection with the Board of
Directors solicitation of the enclosed proxy for the 1995 Annual Meeting of
Shareholders of Del Webb Corporation, a Delaware corporation (the "Company"), to
be held on November 8, 1995, 9:00 a.m., Central Standard Time, at the Four
Seasons Hotel, 98 San Jacinto Boulevard, Austin, Texas 78701. The solicitation
of the enclosed form of proxy is made by the Board of Directors of the Company
and the cost of the solicitation will be borne by the Company. The Proxy
Statement has been furnished to the record holders of shares of common stock,
$.001 par value, of the Company (the "Common Stock") at the close of business on
September 11, 1995 (the "Record Date"). The accompanying Notice of Annual
Meeting, this Proxy Statement, and the enclosed proxy are being mailed on or
about September 22, 1995 to holders of shares of its Common Stock on the Record
Date.
The Annual Meeting is for the purposes of:
1. Electing four Class II Directors for three-year terms expiring at the
Annual Meeting of Shareholders to be held in 1998 or until their
successors have been duly elected and qualified;
2. Approving the Del Webb Corporation 1995 Director Stock Plan;
3. Approving the Del Webb Corporation 1995 Executive Long-Term Incentive
Plan;
4. Approving the Del Webb Corporation 1995 Executive Management Incentive
Plan;
5. Ratifying the appointment of KPMG Peat Marwick LLP as the principal
independent public accounting firm of the Company for the year ending
June 30, 1996; and
6. Transacting such other business as may properly come before the Annual
Meeting.
INFORMATION AS TO VOTING SECURITIES
As of the Record Date, the outstanding securities of the Company entitled to
a vote at the meeting consisted of 17,396,534 shares of Common Stock, each share
being entitled to one vote. A majority of the outstanding shares entitled to
vote shall constitute a quorum for the conduct of business.
ACTION TO BE TAKEN UNDER THE PROXIES
A properly executed proxy in the enclosed form will be voted in accordance
with the instructions thereon. If no instructions are given with respect to the
matters to be acted on, the persons acting under the proxies will vote the
shares represented thereby in favor of the election of the nominees for
directors named herein; in favor of the Del Webb Corporation 1995 Director Stock
Plan; in favor of the Del Webb Corporation 1995 Executive Long-Term Incentive
Plan; in favor of the Del Webb Corporation 1995 Executive Management Incentive
Plan; in favor of the appointment of KPMG Peat Marwick LLP as the principal
independent public accounting firm of the Company for the year ending June 30,
1996; and at their discretion as to such other business as may come before the
meeting or any adjournment thereof. The Board of Directors is not aware of any
other business to be brought before the meeting. If other proper matters or
matters of which the Board is not aware a reasonable time prior to the meeting
are introduced, then, to the extent permissible by law, the persons named in the
enclosed proxy will vote the shares they represent in accordance with their
judgment.
Votes cast by proxy or in person at the Annual Meeting will be tabulated by
the inspectors of election appointed for the meeting and those votes will
determine whether or not a quorum is present. The inspectors of election will
treat abstentions as shares that are present and entitled to vote for purposes
of determining the presence of a quorum, but as unvoted for purposes of
determining the approval of any matter submitted to the shareholders for a vote.
If a broker indicates on the proxy that it does not have discretionary authority
as to certain shares to vote on a particular matter, those shares will not be
considered present and entitled to vote with respect to that matter.
A shareholder executing and returning a proxy has the power to revoke it at
any time before it is exercised by giving written notice of revocation to the
Secretary of the Company at any time prior to the voting of such proxy, by
voting in person at the meeting, or by submitting a later dated proxy.
All persons with valid meeting attendance cards will be admitted to the
Annual Meeting. Accordingly, if you plan to attend the meeting, please mark the
box provided on your proxy card so that we may send you an attendance card. You
also may obtain an attendance card by submitting a written request to the
Secretary of the Company.
PROPOSAL 1
ELECTION OF DIRECTORS
The Board has nominated the four directors named below to serve three-year
terms as Class II directors. The election of the nominees requires a plurality
of the votes cast with a quorum present.
DIRECTORS AND NOMINEES
The Board of Directors currently has ten members, three members in Classes I
and III, respectively, and four members in Class II. At the Annual Meeting of
Shareholders on November 8, 1995, directors in Class II will be elected to serve
until the Annual Meeting of Shareholders in 1998, or until their successors are
elected and qualified.
It is not anticipated that any nominee for election as a director will become
unable to accept nomination but, if such an event should occur, the person or
persons acting under the proxies will vote for a substitute nominee designated
by the Board of Directors or the remaining nominees if no substitute is
nominated.
NOMINEES FOR ELECTION
FOR TERM EXPIRING AT 1998 ANNUAL MEETING
CLASS II
D. KENT ANDERSON, 54, a director of the Company since June 1994, has served
as Chairman of the Board and Chief Executive Officer of Post Oak Bank in
Houston, Texas, since 1991. Mr. Anderson previously served as Chairman of the
Board and held other executive positions with First Interstate Bank of Texas,
N.A from 1988 to 1991.
KENNY C. GUINN, 58, a director of the Company since June 1994, served as
interim President of the University of Nevada, Las Vegas from May 1994 to May
1995 and has served as Chairman of the Boards of Directors of Southwest Gas
Corporation and PriMerit Bank since 1988 and 1987, respectively. Dr. Guinn also
served as Chief Executive Officer of Southwest Gas Corporation from October 1988
to May 1993 and Chief Executive Officer of PriMerit Bank from 1985 to 1992. Dr.
Guinn is a director of Boyd Gaming Corporation and Oasis Residential, Inc.
MICHAEL E. ROSSI, 51, a director of the Company since June 1994, has been
Vice Chairman of BankAmerica Corporation since 1993. Mr. Rossi has held various
positions with Bank of America, a related entity, since 1986, including Chief
Credit Officer from 1990 to 1993 and Executive Vice President, Commercial
Banking Division from 1988 to 1990.
SAM YELLEN, 64, a director of the Company since 1991, was a partner with KPMG
Peat Marwick LLP from 1968 until his retirement in 1990. Mr. Yellen is a
director of Beverly Funding Corporation, Wedbush Corporation, Downey Savings and
Loan Association, and LTC Properties, Inc.
CONTINUING DIRECTORS
FOR TERM EXPIRING AT 1996 ANNUAL MEETING
CLASS III
PHILIP J. DION, 50, has been the Company's Chairman of the Board and Chief
Executive Officer since November 1987. Mr. Dion joined the Company in 1982 and
held various positions in the Company until his appointment as Chairman of the
Board and Chief Executive Officer.
J. RUSSELL NELSON, 65, a director of the Company since 1983, was Dean of
Business and Administration of the University of Colorado from 1989 until his
retirement in 1992 and was President of Arizona State University from 1981 to
1989.
PETER A. NELSON, 63, a director since 1984, was Senior Vice President of
Marketing with McDonald's Corporation from 1984 until his retirement in 1990.
CONTINUING DIRECTORS
FOR TERM EXPIRING AT 1997 ANNUAL MEETING
CLASS I
ROBERT BENNETT, 70, a director since 1985, has been Executive Vice President
with Daiwa Securities America, Inc., an investment banking firm, since July 1995
and was Senior Vice President of Daiwa Securities America, Inc. from January
1987 to July 1995.
HUGH F. CULVERHOUSE, JR., 46, a director since 1990, has been a partner in
the law firm of Hugh F. Culverhouse, P.A. and its predecessor firm since 1987.
C. ANTHONY WAINWRIGHT, 62, a director of the Company since 1988, has been the
Chairman of the advertising agency of Harris, Drury, Cohen, Inc. since May 1995.
From 1989 until April 1995, Mr. Wainwright was the Vice Chairman of the
advertising agency of Campbell-Mithun-Esty. Mr. Wainwright is a director of
All-Comm Media, Inc., American Woodmark Co., Gibson Greeting Cards Co., and
Specialty Retail Group, Inc.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE "FOR" ELECTION OF THE CLASS II DIRECTORS.
MEETINGS OF THE BOARD OF DIRECTORS
During the fiscal year ending June 30, 1995, the Board of Directors held four
regular meetings and one special meeting. All members of the Board attended more
than 75% of the meetings of the Board and the committees on which they serve.
COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors appoints an Audit Committee, Executive Committee,
Finance Committee, Human Resources Committee, and Nominating Committee.
Audit Committee. None of the members of the Audit Committee is an employee of
the Company. The Audit Committee makes recommendations to the Board concerning
the selection of outside auditors, reviews the scope and results of independent
and internal audits, and monitors the sufficiency of internal auditing,
accounting, and financial controls. In addition, the Audit Committee monitors
the Company's Code of Conduct, which is administered by the Company's Ethics
Committee. The Audit Committee held three regular meetings during the year ended
June 30, 1995.
Executive Committee. The Executive Committee acts on Board matters that arise
between meetings of the full Board of Directors. The Executive Committee held
one special meeting during the year ended June 30, 1995.
Finance Committee. The Finance Committee is responsible for supervision of
all corporate financial matters; reviews and considers the Company's capital
structure, source and use of funds, financial position, capital and operating
budgets, and expenditures; reviews proposed sales of assets; reviews and
evaluates acquisitions, mergers, or divestitures; and reviews the Company's
dividend policies. The Finance Committee held two regular meetings and one
special meeting during the year ended June 30, 1995.
Human Resources Committee. The Human Resources Committee functions as the
Company's compensation committee and is responsible for reviewing and approving
the compensation of executives with a base pay in excess of $125,000, including
such employee's participation in stock option and restricted stock plans and
incentive plans. The Human Resources Committee also reviews the compensation,
benefits (including executive perquisites), management development,
organizational development, and affirmative action policies of the Company. In
addition, if approved at the Annual Meeting, the Human Resources Committee will
administer the Del Webb Corporation 1995 Director Stock Plan, the Del Webb
Corporation 1995 Executive Long-Term Incentive Plan, and the Del Webb
Corporation 1995 Executive Management Incentive Plan. Certain employee benefit
plans may be submitted by the Human Resources Committee to the Board for its
approval. The Human Resources Committee held two regular meetings during the
year ended June 30, 1995.
Nominating Committee. The Nominating Committee reviews and recommends changes
in the size and composition of the Board of Directors and evaluates and
recommends candidates for election to the Board of Directors and appointment to
Board Committees. The Nominating Committee will consider proposals for
nomination from shareholders that are made in writing to the Secretary, that are
timely and that contain sufficient background information concerning the nominee
to enable proper judgment to be made as to his or her qualifications. The
Nominating Committee held no meetings during the year ended June 30, 1995, but
met in July, 1995 regarding the nominations of the Class II directors discussed
herein.
The composition of each committee currently is as follows:
AUDIT COMMITTEE EXECUTIVE COMMITTEE
Sam Yellen* Peter A. Nelson*
J. Russell Nelson Philip J. Dion
Michael E. Rossi Hugh F. Culverhouse, Jr.
HUMAN RESOURCES COMMITTEE FINANCE COMMITTEE
Peter A. Nelson* Hugh F. Culverhouse, Jr.*
Kenny C. Guinn D. Kent Anderson
C. Anthony Wainwright Robert Bennett
NOMINATING COMMITTEE
J. Russell Nelson*
Robert Bennett
C. Anthony Wainwright
Sam Yellen
Philip J. Dion, Ex-Officio
----------
* Denotes Chairman.
COMPENSATION OF DIRECTORS
Directors who are not officers of the Company receive an annual retainer of
$20,000 and a meeting fee of $1,000 for each meeting of the Board or a committee
thereof. A director who serves as a committee chairman also receives an
additional $1,000 annually. Directors who are not officers and who devote time
to committee-related activities other than attendance at meetings may be paid a
per diem fee equal to the meeting fee for such additional service.
Nonemployee directors of the Company are eligible to participate in the Del
Webb Corporation Director Stock Plan, which provides for the automatic annual
grant of 1,000 options to eligible nonemployee directors and the opportunity for
nonemployee directors to defer all or a portion of their annual retainer into
stock options and/or restricted stock. With respect to the automatic annual
grants, all grants are made at the fair market value on the date of grant,
November 20 of each calendar year. Each option granted under this feature will
expire on the tenth anniversary of the date of grant. Participants are entitled
to exercise one-third of such options on each of the first, second and third
anniversaries of the date of grant.
On or before December 31 of each year, each nonemployee director has the
ability to elect to defer any portion or all of his or her annual retainer for
the fiscal year commencing on July 1 of the next calendar year. Deferrals may,
at the discretion of each director, be made in the form of stock options or
restricted stock. Any deferral election is irrevocable for the period made. Each
director may also elect to defer up to 100% of his or her annual retainer and
meeting fees under the Del Webb Corporation Deferred Compensation Plan. Under
this plan, the irrevocable deferral election must be made on or before December
15 each year in order to be in effect for the following calendar year.
Additionally, if approved by the Company's Shareholders at the Annual
Meeting, the Del Webb Corporation 1995 Director Stock Plan will be available to
eligible nonemployee directors. The Del Webb Corporation 1995 Director Stock
Plan contains substantially the same terms and provides similar benefits as the
Del Webb Corporation Director Stock Plan discussed above, except that the Del
Webb Corporation 1995 Director Stock Plan provides for the automatic annual
grant of an option to purchase 2,000 shares of Common Stock during each calendar
year (less the number of shares granted to the director under the Del Webb
Corporation Director Stock Plan during each such calendar year).
REPORT OF HUMAN RESOURCES COMMITTEE
OF THE BOARD OF DIRECTORS
ON EXECUTIVE COMPENSATION
The executive compensation policies of the Company have been developed to
further the Company's strategic mission of being a leader in the industries in
which it participates and maximizing shareholder value. To meet these business
objectives, the Company maintains a policy that the compensation of all
executive officers should emphasize the relationship between pay and performance
by including variable, at-risk compensation that depends upon the financial
performance and the strategic positioning of the Company. To this end, the
Company provides compensation levels necessary to attract and retain high-
quality executives, to motivate key executives to achieve or exceed corporate
financial and operational goals, and to contribute to the short- and long-term
interests of shareholders.
The Human Resources Committee (the "Committee") of the Board of Directors
administers the Company's executive compensation program for executives with a
base pay in excess of $125,000, evaluates the performance of corporate officers,
and considers management succession and related matters. The Committee reviews
with the Board all aspects of compensation for the Chief Executive Officer, Mr.
Dion, and reviews in general the compensation of all other executives. The
Committee currently is comprised of three independent, nonemployee directors.
The Company's executive compensation program consists of two key elements:
(1) an annual component, which consists of base salary and an annual bonus; and
(2) a long-term component, which consists of grants of stock options and shares
of restricted stock. The policies with respect to each of these elements, as
well as the basis for determining the compensation of Mr. Dion, are described
below.
ANNUAL COMPONENT
BASE SALARY
The Committee reviews each executive's base salary. Base salaries for
executive officers are determined by evaluating each individual's performance,
experience, and level of responsibility in comparison to similar positions
within the Company and in the homebuilding industry. In establishing salaries
for fiscal 1995, the Committee considered each executive's contributions during
the past fiscal year and the competitive market for equally qualified
executives. In fiscal 1995, the Committee authorized increases in the base
salaries of the executive officers listed in the Summary Compensation Table on
page 8, other than Mr. Dion, in the range of 4% to 6%.
Mr. Dion's base salary for the year ended June 30, 1995, was established
under an Employment Agreement dated May 18, 1988, as amended January 20, 1989,
May 17, 1989, and December 1, 1992 (the "Agreement"). The Agreement provides for
a base salary of $500,000.
ANNUAL BONUS
The Company's annual bonus awards are a significant component of executive
compensation, reflecting the Company's belief that compensation should be linked
to performance. Under the Company's annual Management Incentive Plan, annual
bonuses paid to executives employed at corporate headquarters are based on the
financial performance (consolidated net earnings) of the entire Company.
Executives assigned to operations are evaluated upon both the financial
performance (project cash flow and net earnings) of the operating community or
division to which the executives are assigned and the financial performance of
the entire Company. The Committee predetermines target annual bonuses for each
executive, and for fiscal 1995 these target bonuses for the named executive
officers, other than Mr. Dion, ranged from 50% to 60% of the executive's annual
base salary. In years in which the Company's financial performance (including
cash flow and net earnings) exceeds target performance, an executive could earn
an annual bonus of up to 200% of the target amount; however, in the years in
which the Company's financial performance does not meet target performance,
bonus payments can be reduced or eliminated. In fiscal 1995, annual bonuses paid
to the four highest paid executives, other than Mr. Dion, represented 58% to 99%
of their annual base salary.
Mr. Dion received an annual bonus under the Company's Management Incentive
plan of $800,000, which together with his base salary, represented an 18%
increase in Mr. Dion's aggregate cash compensation for fiscal 1995 over fiscal
1994. With respect to Mr. Dion, the Committee did not use a predetermined
formula for the purpose of establishing his annual bonus. Rather, the Committee
considered the various components of the Company's and Mr. Dion's performance in
reaching its overall judgment of Mr. Dion's performance for the year. The
Committee determined that Mr. Dion's cash compensation was appropriate in light
of the following fiscal 1995 Company performance accomplishments: (1) a 67%
increase in net earnings; (2) a 57% increase in total revenues; (3) a 65%
increase in earnings per share; and (4) a 36% increase in home closings. These
figures represent record earnings for the Company during a period of industry
challenges. In addition, Mr. Dion's compensation was based on qualitative
factors such as the continued improvement and development of the Company's
management team, his overall leadership in strategic planning for the Company,
and accomplishment of major strategic objectives, such as the successful opening
of new communities.
LONG-TERM COMPENSATION
STOCK OPTIONS AND RESTRICTED STOCK
Long-term compensation comprises a substantial portion of total executive
compensation in order to retain executives, motivate them to improve the
long-term value of the Company's stock, and to further the Company's objective
of linking compensation to performance. Long-term incentive compensation
includes both stock options and shares of restricted stock, which contain
vesting and restriction periods that are conditioned upon the executive's
continued employment. Consequently, the Company is able to maintain a cohesive
management team and to focus management's attention on the long-term interests
of the Company and the shareholders. When awarding long-term compensation, the
Committee examines the executive's level of responsibility, prior compensation,
previous long-term incentive awards, individual performance criteria, and
industry practices relating to similar compensation. Stock options directly link
executive rewards to the stock market's assessment of the Company's success,
while restricted stock provides a strong retention device as well as an
effective method for increasing executive stock ownership, thus encouraging a
personal proprietary interest, close identification with the Company and an
alignment of interests with those of the shareholders. All stock options granted
during fiscal 1995 were granted at the prevailing market price at the time of
grant with vesting over three years and will have value only if the price of the
Company's Common Stock increases. All shares of restricted stock granted during
fiscal 1995 have restrictions that lapse over four years. This incentive
structure focuses management attention on maximizing shareholder wealth in the
long term. Grants of stock options and restricted stock are made under various
stock plans, each of which has been approved by the Company's shareholders.
Both restrictive share awards and stock option grants were determined as a
percentage of base salary, which varied with each executive's responsibilities
and relative position within the Company. Restricted shares awarded in fiscal
1995 represented 37% to 55% of base salary for the named executives other than
Mr. Dion. Mr. Dion's award of restricted stock represented approximately 77% of
his base salary.
Section 162(m) of the Internal Revenue Code generally disallows deductions to
public companies for executive compensation in excess of $1 million to named
executive officers. This deduction limitation does not apply to
"performance-based" executive compensation. The Company's policy is to comply
with the requirements of Section 162(m) and maintain deductibility for all
executive compensation, except in circumstances where the Committee concludes on
an informed basis, in good faith, and with the honest belief that it is in the
best interest of the Company and the shareholders to take actions with regard to
the payment of executive compensation which do not qualify for tax
deductibility. To further this policy, the Board of Directors has recommended
that shareholders approve Proposals 3 and 4, which are intended to preserve the
deductibility for federal income tax purposes of certain elements of the
compensation of Mr. Dion and the other named executives for tax years commencing
in fiscal 1996.
HUMAN RESOURCES COMMITTEE
Peter A. Nelson, Chairman
Kenny C. Guinn
C. Anthony Wainwright
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth for the fiscal years ended June 30, 1995,
1994, and 1993, respectively, information concerning compensation of the persons
named below for services in all capacities to the Company and its subsidiaries.
<TABLE>
SUMMARY COMPENSATION TABLE
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
------------------------
RESTRICTED
ANNUAL COMPENSATION STOCK ALL OTHER
------------------- AWARDS ($) OPTIONS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR SALARY ($)(1) BONUS ($) (2) (#) ($)(3)
---------------------------- ------ ------------- --------- ------------ --------- --------------
<S> <C> <C> <C> <C> <C> <C>
Philip J. Dion 1995 $519,231 $800,000 $401,575 35,000 $7,010
Chairman of the Board and 1994 $500,000 $600,000 $199,695 30,000 $6,738
Chief Executive Officer 1993 $427,948 $500,000 $238,000 27,500 $6,433
Joseph F. Contadino 1995 $265,769 $200,000 $ 96,378 10,000 $6,531
Senior Vice President and 1994 $201,538 $175,000 $ 39,939 7,500 $7,018
President of Coventry Homes 1993 $156,891 $150,000 $ 38,500 5,100 $5,250
Frank D. Pankratz 1995 $239,808 $140,000 $ 96,378 10,000 $5,751
Senior Vice President and 1994 $225,000 $ 50,000 $ 39,939 9,000 $5,055
General Manager -- Sun City 1993 $221,474 $117,400 $ 38,250 7,500 $4,814
Palm Desert
LeRoy C. Hanneman 1995 $177,500 $175,000 $ 96,378 10,000 $5,927
Senior Vice President and 1994 $159,231 $177,700 $ 39,939 7,500 $5,622
General Manager -- Sun City 1993 $144,872 $100,000 $ 35,250 5,100 $4,731
Summerlin
John A. Spencer 1995 $178,558 $164,500 $ 96,378 10,000 $5,814
Senior Vice President and 1994 $164,615 $105,000 $ 39,939 7,500 $4,358
Chief Financial Officer 1993 $156,890 $100,000 $ 35,626 5,100 $5,015
----------
(1) Includes an additional pay period for fiscal 1995 and november 1994 salary
increases for all named executives other than Mr. Dion.
(2) At June 30, 1995, aggregate restricted shareholdings in shares (and
dollars) were 39,666 ($922,235) for Mr. Dion, 8,666 ($201,485) for Mr.
Contadino, 8,666 ($201,485) for Mr. Pankratz, 8,666 ($201,485) for Mr.
Hanneman, and 8,666 ($201,485) for Mr. Spencer. Dividends subsequent to the
acceptance date of restricted stock awards are paid directly to the
executives.
(3) Includes fiscal 1995 contributions by the Company to the retirement savings
plan of $4,500, $4,985, $4,895, $4,840, and $4,806 for Messrs. Dion,
Contadino, Pankratz, Hanneman, and Spencer, respectively. this column also
includes the portion of fiscal 1995 premium payments attributable to term
coverage under the Key Executive Life Plans ("KELPs") in the amount of
$2,510, $1,546, $856, $1,087, and $1,008 for Messrs. Dion, Contadino,
Pankratz, Hanneman, and Spencer, respectively. The KELPs are group life
insurance plans implemented in May 1991 ("KELP I" for 60 key executives)
and April 1992 ("KELP II" for the same 60 key executives, including those
covered under KELP I). The Company pays the annual premiums on the
policies; however, upon death or retirement, the aggregate of the annual
premiums is repaid to the Company. The coverage amounts under KELP I are
$1,510,043, $679,577, $770,027, $682,325, and $787,563 for Messrs. Dion,
Contadino, Pankratz, Hanneman, and Spencer, respectively. The coverage
amounts under KELP II are $1,331,996, $679,577, $641,634, $651,976, and
$649,565 for Messrs. Dion, Contadino, Pankratz, Hanneman, and Spencer,
respectively.
</TABLE>
<TABLE>
OPTION GRANTS IN LAST FISCAL YEAR
<CAPTION>
INDIVIDUAL GRANTS
---------------------------------------------------
NUMBER OF POTENTIAL REALIZABLE VALUE
SECURITIES % OF TOTAL AT ASSUMED ANNUAL RATES
UNDERLYING OPTIONS OF STOCK APPRECIATION FOR
OPTIONS GRANTED TO EXERCISE OPTION TERM
GRANTED EMPLOYEES IN OR BASE EXPIRATION --------------------------
NAME (#/SHARES)(1) FISCAL YEAR PRICE ($/SH) DATE 5% ($) 10% ($)
-------------------------- ------------- ----------- ------------ --------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Philip J. Dion ........... 35,000 11.24% $16.063 11-01-04 $353,568 $896,010
Joseph F. Contadino....... 10,000 3.21% $16.063 11-01-04 $101,019 $256,003
Frank D. Pankratz ........ 10,000 3.21% $16.063 11-01-04 $101,019 $256,003
LeRoy C. Hanneman ........ 10,000 3.21% $16.063 11-01-04 $101,019 $256,003
John A. Spencer .......... 10,000 3.21% $16.063 11-01-04 $101,019 $256,003
----------
(1) All options granted during fiscal 1995 vest equally over a three-year period
commencing on the date of grant.
</TABLE>
<TABLE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR END OPTION VALUES
<CAPTION>
NUMBER OF VALUE OF
SECURITIES UNEXERCISED
SHARES UNDERLYING IN-THE-
ACQUIRED UNEXERCISED MONEY
ON VALUE OPTIONS AT OPTIONS AT
EXERCISE REALIZED JUNE 30, 1995 JUNE 30, 1995
NAME (#) ($) (#) ($)
------------------- ---------- ---------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C>
Philip J. Dion ..... 0 0 293,434 Exercisable $3,498,324
64,166 Unexercisable $ 508,718
Joseph F. Contadino 0 0 24,600 Exercisable $ 289,855
16,700 Unexercisable $ 132,393
Frank D. Pankratz . 0 0 62,400 Exercisable $ 724,311
18,500 Unexercisable $ 147,430
LeRoy C. Hanneman . 0 0 39,400 Exercisable $ 445,918
16,700 Unexercisable $ 132,393
John A. Spencer ... 0 0 52,400 Exercisable $ 606,428
16,700 Unexercisable $ 132,393
</TABLE>
SUPPLEMENTAL EXECUTIVE RETIREMENT PLANS
The Company has two Supplemental Executive Retirement Plans ("SERPs"): "SERP
I," effective January 1, 1986, and "SERP II," effective January 1, 1989. Under
the SERPs, executive officers of the Company and its subsidiaries, as designated
by the Company's Chief Executive Officer, or the Board in the case of the Chief
Executive Officer, are eligible to receive benefits upon their retirement,
death, disability, or termination of employment. Messrs. Dion and Spencer are
participants of SERP I and Messrs. Contadino, Pankratz, and Hanneman are
participants of SERP II. Mr. Dion's full benefit under SERP I is payable,
without actuarial reduction, at age 55. Mr. Spencer's full benefit under SERP I
and participants of SERP II are payable, respectively, at age 65. The following
table sets forth estimated annual retirement benefits for participants of SERP I
and SERP II, respectively, at a specified compensation level (based on the
participant's highest average annual total of salary and bonuses during any five
calendar years out of the seven consecutive calendar years of employment with
the Company that will produce the highest amount, less certain offsets) and
years of service classifications:
SERP I SERP II
HIGHEST YEARS OF SERVICE YEARS OF SERVICE
AVERAGE ----------------------- -----------------------
REMUNERATION 10 20 OR MORE 10 20 OR MORE
-------------- ---------- ------------ ---------- ------------
$ 150,000 $ 52,500 $105,000 $ 45,000 $ 90,000
250,000 87,500 175,000 75,000 150,000
350,000 122,500 245,000 105,000 210,000
450,000 157,500 315,000 135,000 270,000
550,000 192,500 385,000 165,000 330,000
650,000 227,500 455,000 195,000 390,000
750,000 262,500 525,000 225,000 450,000
850,000 297,500 595,000 255,000 510,000
950,000 332,500 665,000 285,000 570,000
1,050,000 367,500 735,000 315,000 630,000
1,150,000 402,500 805,000 345,000 690,000
1,250,000 437,500 875,000 375,000 750,000
1,350,000 472,500 945,000 405,000 810,000
Offsets not reflected in the above table include reductions for the
equivalent of benefits received from employer contributions to the Retirement
Savings Plan and certain predecessor or successor plans and 50% of the
participant's maximum Social Security benefit at age 65. A participant becomes
vested in retirement benefits pursuant to the SERPs at the rate of 10% per year
in which the participant has been continuously employed with the Company since
January 1, 1981 or their date of hire, whichever is later. In addition, Mr. Dion
is credited with 1.5 years of service for each year of service with the Company
after January 1, 1989. The estimated credit years of service for each of the
individuals named in the Summary Compensation Table is as follows: under SERP I,
Mr. Dion, 16 years and Mr. Spencer, 14 years; and under SERP II, Mr. Contadino,
4 years, Mr. Pankratz, 8 years, and Mr. Hanneman 14 years.
In the event a participant dies while employed by the Company, a survivor's
benefit will be paid in lieu of the above retirement benefits in an amount based
upon the greater of the actuarial equivalent lump sum value of such
participant's retirement benefit or three times certain of such participant's
compensation, payable in ten equal annual installments. In the event of
disability, a participant is entitled to receive the actuarial equivalent lump
sum value of such participant's retirement benefit payable in monthly
installments over ten years without interest. In the event of termination other
than death, disability, or retirement, a participant is entitled to receive the
vested portion of his or her normal retirement benefits. The benefit is
actuarially reduced from the normal retirement date to the termination date. If
the participant's termination occurs for reasons other than death or disability
and after age 55 and the completion of 10 or more years of service, the
participant qualifies for an early retirement benefit. The early retirement
benefit is equal to the normal retirement benefit accrued to the date of
termination, reduced by 3% for each year by which the early retirement precedes
the normal retirement date.
Both SERPs contain a change of control provision that provides that if a
participant is terminated within three years after a change in control, the
participant would be fully vested, be credited with 20 years of service and be
deemed to be the greater of age 55 or the participant's actual age. Using these
parameters, the benefit would be calculated, discounted back to the
participant's actual age, and paid in an actuarial equivalent lump sum. Mr.
Dion's benefit would not be discounted to his actual age but would be paid
assuming he is 55 years of age.
Both SERPs allow a participant or beneficiary to elect to receive a lump sum
distribution of all or a portion of the participant's unpaid benefits, subject
to a 10% penalty, following a change of control or termination of employment
("Accelerated Distribution"). In addition, in the event of a participant's
death, the beneficiary may elect to receive an Accelerated Distribution.
EMPLOYMENT AGREEMENTS
As discussed above, the Company has entered into an Employment Agreement with
Mr. Dion pursuant to which Mr. Dion serves as Chairman of the Board and Chief
Executive Officer. The Agreement provides for a minimum annual base salary of
$500,000 and participation in any Company incentive compensation plan, pension,
or profit sharing plans, stock purchase plan or executive retirement plan. Any
such plan may be established at the discretion of the Board of Directors. The
Agreement also provides for a term which extends automatically for an additional
one-year period (so as to provide a continuous term of approximately three years
after extension) unless prior to each Annual Meeting of Shareholders of the
Company, either the Company gives 30 days' notice or Mr. Dion gives 90 days'
notice that, except for Good Cause (as defined in the Agreement), the notifying
party does not wish to further extend the term of the Agreement. In the event of
Mr. Dion's death during the term of the Agreement, his widow or, if she shall
not survive him, his estate shall receive his salary for 12 calendar months
following the date of his death, without reference to the term of the Agreement.
If, within 24 months after a change in control of the Company, Mr. Dion
terminates his employment with the Company for Good Reason (as defined),
irrespective of the period then remaining until the end of the term of the
Agreement, he shall be entitled to severance benefits, including (i) a severance
payment equal to three years of his base salary in effect as of the date of
notification of termination, three years' incentive compensation calculated as
55% of such base salary, and three years' fringe benefits calculated as 16 2/3 %
of base salary; (ii) reimbursement for all expenses incurred in finding new
employment and moving or, at his election, $50,000; (iii) office space and
secretarial services for a specified period; (iv) accelerated exercisability of
all stock options and stock appreciation rights held by him; (v) lapse of
restrictions on all shares of restricted stock that have been held by him for at
least twelve months; and (vi) an amount equal to any "excess tax" imposed upon
such severance benefits that are deemed to be a "parachute payment." Under Mr.
Dion's Agreement, a change in control occurs if a person or entity becomes the
beneficial owner of 20% or more of the outstanding voting securities of the
Company, unless there is no change in the majority of the Board of Directors
following such acquisition, or if, within two years of a tender offer or
exchange offer for the voting securities of the Company, or as a result of a
merger, consolidation, sale of assets, or contested election, or any such
combination, there is a change in a majority of the Board of Directors of the
Company or its successor.
In the event Mr. Dion's employment is terminated by the Company prior to the
expiration of the Agreement for a reason other than his death, permanent
disability, cause, or upon a change of control, he shall be entitled, for the
balance of the term of the Agreement, to the benefits set forth in (ii), (iii),
(iv), and (v) above, as well as his regular compensation under the Agreement,
incentive compensation (calculated at 55% of his base salary), fringe benefits
(calculated at 16 2/3% of his base salary), normal business expenses, and
vested benefits under the Company's SERPs.
As of the date hereof, in addition to the change of control provisions
contained in Mr. Dion's employment agreement with the Company, the Company has
change of control agreements with 14 other key officers of the Company,
including Messrs. Contadino, Pankratz, Hanneman, and Spencer. Such change of
control agreements provide that, upon the termination of the officer's
employment by the Company in connection with a change of control of the Company,
the officer, based upon position, will receive a lump sum payment equal to (i)
one and one-half or two times the annual base salary in effect at any time
during the 12 months prior to termination; (ii) the greater of all bonuses paid
during the 12 months prior to termination or 30 to 40% of the termination
salary; and (iii) 20% of the termination salary in lieu of fringe benefits. In
addition, all options and restricted stock previously granted will become
immediately exercisable and free of all restrictions. A change in control is
considered to occur if a person or entity becomes the beneficial owner of 25% or
more of the voting securities of the Company, or if, within two years of a
tender offer or exchange offer for the voting securities of the Company, or as a
result of a merger, consolidation, sale of assets, or contested election, or any
such combination, there is a change in a majority of the Board of Directors of
the Company or its successor.
PERFORMANCE GRAPH
The following graph compares the five-year cumulative total return on the
Company's Common Stock to total returns on the Standard & Poor's 500 Stock Index
and a composite index of peer group corporations in the homebuilding industry
(the "Composite Index").
The Composite Index of peer group corporations includes Centex Corporation;
Continental Homes Holding Corp.; Hovnanian Enterprises, Inc.; Kaufman & Broad
Home Corporation; Lennar Corporation; Pulte Corporation; The Ryland Group, Inc.;
Standard Pacific Corp.; and Toll Brothers, Inc. The Composite Index is
consistent with the peer group corporations used in the Company's 1994 Proxy
Statement with the exception of the exclusion of UDC Homes, Inc. That company
was excluded due to its bankruptcy filing in the United States Bankruptcy Court
and cessation of trading.
The graph assumes that the value of the investment in Del Webb Corporation
Common Stock, the S&P 500 Index, and the peer group companies each was $100 on
June 30, 1990, and that all dividends were reinvested. The peer group is
weighted by market capitalization.
[PERFORMANCE GRAPH HERE]
PRINCIPAL SHAREHOLDERS
To the best of the Company's knowledge, the following are beneficial owners
of more than 5% of any class of the Company's voting securities as of August 31,
1995:
AMOUNT AND
NATURE OF
NAME AND ADDRESS BENEFICIAL PERCENTAGE
TITLE OF CLASS OF BENEFICIAL OWNER OWNERSHIP OF CLASS
-------------- ------------------------------ ------------ ------------
Common Stock Fidelity Management & Research 2,245,200 12.9%
82 Devonshire Street
Boston, MA 02109
The Company makes no representations as to the accuracy or completeness of
the information reported.
SHARE OWNERSHIP OF DIRECTORS AND OFFICERS
The following table sets forth, as of September 11, 1995 certain information
regarding beneficial ownership of the Company's Common Stock by each director,
the Company's five most highly compensated executive officers, and the directors
and executive officers of the Company as a group.
AMOUNT OF PERCENT
BENEFICIAL OWNER BENEFICIAL OWNERSHIP(1) OF CLASS
-------------------------------- ----------------------- --------
D. Kent Anderson 0 --
Robert Bennett 4,001 *
Joseph F. Contadino 49,823 *
Hugh F. Culverhouse, Jr. 12,595 *
Philip J. Dion 456,565(2) 2.6%
Kenny C. Guinn 2,000 *
LeRoy C. Hanneman 68,030 *
J. Russell Nelson 2,483 *
Peter A. Nelson 12,001 *
Frank D. Pankratz 100,943 *
Michael E. Rossi 0 --
John A. Spencer 93,481 *
C. Anthony Wainwright 2,817 *
Sam Yellen 11,245 *
Directors and executive officers 1,290,288 7.1%
as a group
----------
* Less than 1% of the issued and outstanding shares of Common Stock of the
Company.
(1) Lists voting securities, including restricted stock held by directors and
officers over which the officers have voting power but no investment power.
Otherwise, each director or officer has sole voting power and investment
power over the shares reported, except as noted. This column also includes
the following shares that may be acquired pursuant to options exercisable
within 60 days: 1,001 shares for Mr. Bennett; 30,434 for Mr. Contadino;
7,595 for Mr. Culverhouse; 315,101 for Mr. Dion; 45,234 for Mr. Hanneman;
2,383 for Dr. J. R. Nelson; 2,001 shares for Mr. P. Nelson; 58,234 for Mr.
Spencer; 2,001 shares for Mr. Wainwright; 10,245 shares for Mr. Yellen; and
839,699 shares for directors and executive officers as a group.
(2) Includes 6,250 shares held in a trust for the benefit of Mr. Dion's
children.
PROPOSAL 2
APPROVAL OF THE
DEL WEBB CORPORATION 1995 DIRECTOR STOCK PLAN
GENERAL
The Board of Directors of the Company has adopted a new stock plan entitled
the "Del Webb Corporation 1995 Director Stock Plan" (the "Director Stock Plan")
for nonemployee directors of the Company. The Director Stock Plan shall become
effective as of November 8, 1995, subject to approval by the affirmative vote of
the holders of the majority of Company Common Stock present, or represented, and
entitled to vote thereon, at the Annual Meeting of Shareholders.
The Board of Directors believes that the Director Stock Plan will promote the
achievement of long-term objectives of the Company and its subsidiaries by
linking the personal interests of nonemployee directors to those of Company
shareholders and by aiding the Company in attracting, obtaining, and retaining
directors of outstanding competence.
There are two components of the Director Stock Plan: (1) the automatic annual
granting of stock options to eligible nonemployee directors and (2) the
opportunity of nonemployee directors to defer into stock options or restricted
stock all or a portion of their annual retainers. A summary of the principal
provisions of the Director Stock Plan and each of these components of the
Director Stock Plan is set forth below. The summary is qualified by reference to
the full text of the Director Stock Plan, which is attached as Appendix A to
this Proxy Statement.
ELIGIBILITY
Only nonemployee directors of the Company are eligible to participate.
ADMINISTRATION
The Director Stock Plan will be administered by the Human Resources Committee
of the Board of Directors, the Board of Directors, or any other committee
appointed by the Board of Directors (the "Committee"). The Committee has the
full power, discretion, and authority to interpret and administer the Director
Stock Plan; however, the Committee in no event will have any power to (i)
determine eligibility, or to determine the number, value, vesting period, or
timing of awards to be made under the Director Stock Plan, or (ii) cause the
awards under the Director Stock Plan not to be treated as "formula awards"
within the meaning of the Securities Exchange Act of 1934, as amended.
SHARES AVAILABLE
An aggregate of 75,000 shares of Company Common Stock are available for grant
under the Director Stock Plan. If any option or share of restricted stock
granted under the Director Stock Plan terminates, expires, or lapses for any
reason, the shares subject to purchase pursuant to such option and any such
shares of restricted stock again shall be available for grant under the Director
Stock Plan.
AMENDMENT AND TERMINATION
The Board may terminate, amend, or modify the Director Stock Plan at any time
(except that plan provisions relating to the amount, price, and timing of
securities to be awarded may not be amended more than once every six months
other than to comport with changes in the Internal Revenue Code of 1986, as
amended from time to time (the "Code"), or the regulations promulgated
thereunder); provided, however, that shareholder approval is required for any
amendment that would materially increase the benefits accruing to directors
under the Director Stock Plan, materially increase the number of securities
subject to the plan, or materially modify the eligibility requirements.
The Director Stock Plan shall remain in effect until all shares subject to it
have been either purchased or acquired in accordance with the terms; however, in
no event may an award be granted under the Director Stock Plan on or after
November 7, 2005.
CHANGE IN CONTROL
In the event of a change in control of the Company, all awards granted under
the Directors Stock Plan that are outstanding and not vested shall immediately
become vested. Under the Director Stock Plan, a change in control occurs upon
any of the following events: (i) any person becoming the beneficial owner of 20%
or more of the Company's Common Stock; (ii) during any two-year period, the
persons who are on the Company's Board of Directors at the beginning of such
period and any new person elected by two-thirds of such directors cease to
constitute a majority of the persons serving on the Board of Directors; or (iii)
the Company's shareholders approve (a) a merger or consolidation of the Company
with another corporation (other than a merger in which 80% of the current
shareholders remain as shareholders of the new corporation), (b) a plan of
complete liquidation, or (c) a sale of substantially all of the Company's
assets.
AUTOMATIC OPTION GRANT COMPONENT
STOCK OPTIONS
Subject to shareholder approval of the Director Stock Plan, each nonemployee
director on November 20, 1995 shall be automatically granted an option to
purchase 2,000 shares of Company Common Stock on each November 20 of each
calendar year, commencing in 1995 (less the number of shares granted to the
director under the Del Webb Corporation Director Stock Plan during each such
calendar year). All grants shall be made at the fair market value on the date of
grant. Each option granted under this component will expire on the 10th
anniversary date of its grant. Participants will be entitled to exercise such
options according to the following vesting schedule: one-third on the first
anniversary of the date of grant; and one-third on each of the second and third
anniversaries of the date of grant.
FEDERAL TAX CONSEQUENCES
A director who is granted an option will not recognize taxable income upon
the grant of the option. Upon exercise of the option, the director will
recognize compensation taxable as ordinary income in an amount equal to the
difference between the fair market value of the shares of Company Common Stock
at the time of exercise and the option price. The Company will generally be
entitled to a corresponding tax deduction at the time that the director
recognizes compensation income.
RETAINER DEFERRAL COMPONENT
DEFERRALS
On or before December 31 of each year, each nonemployee director will have
the ability to elect to defer any portion or all of his or her annual retainer
for the fiscal year commencing on July 1 of the next calendar year. Deferrals
may, at the discretion of each director, be made in the form of stock options or
restricted stock. Any deferral election is irrevocable for the period made.
RESTRICTED STOCK
Any shares of restricted stock issued to a director under the deferral
components are issued in the name of the director but may be held by the Company
during the restricted period.
The number of shares of restricted stock that will be granted pursuant to a
retainer deferral shall be equal to the amount of the retainer deferred divided
by the fair market value of one share of the Company's Common Stock on the Grant
Date. The "Grant Date" means the tenth day following the public release of the
Company's year end financial information. The restrictions on the restricted
stock will lapse six months from the Grant Date. During the restricted period,
the director is entitled to receive all dividends and exercise all voting rights
with respect to such restricted stock. All shares of restricted stock issued
under the Director Stock Plan may not be sold, transferred, pledged, assigned,
or otherwise disposed of until the restrictions lapse.
FEDERAL INCOME TAX CONSEQUENCES -- RESTRICTED STOCK
A director who elects to receive restricted stock will generally not
recognize taxable income upon the receipt of the restricted stock, unless the
director elects under Section 83(b) of the Code to include the fair market value
of the restricted stock in income. In the absence of such an election, the
directors will include the fair market value of the restricted stock in income
when the restricted stock is no longer subject to a substantial risk of
forfeiture or the restricted stock becomes transferable. The Company will
generally be entitled to a corresponding tax deduction at the time the director
recognizes taxable income.
If the director does not make an 83(b) election, dividends on the restricted
stock will be includible in the director's taxable income as compensation income
and the Company will be entitled to a corresponding tax deduction. If the
director does make an 83(b) election, dividends on the restricted stock will be
includible in the director's taxable income as dividend income, but the Company
will not be entitled to a corresponding tax deduction.
DEFERRAL OPTIONS
The number of shares that may be purchased pursuant to retainer deferrals
shall be equal to the amount of the retainer deferred divided by twenty-five
percent of the fair market value of one share of the Company's Common Stock on
the Grant Date. Deferral options so granted shall vest 100% at the end of the
sixth month following the date of grant. The option exercise price will be equal
to 75% of the fair market value on the Grant Date. Options are issued using
these formulae to give the director who is deferring his or her cash retainer an
equivalent economic value.
Each option granted under this component shall expire on the tenth
anniversary date of the Grant Date.
FEDERAL TAX CONSEQUENCES -- DEFERRAL OPTIONS
A director who is granted an option or elects to receive an option in lieu of
the annual retainer generally will not recognize taxable income upon the grant
of the option. Upon exercise of the option, the director will recognize
compensation taxable as ordinary income in an amount equal to the difference
between the fair market value of the shares of Company Common Stock at the time
of exercise and the option price. The Company will generally be entitled to a
corresponding tax deduction at the time that the director recognizes
compensation income.
VOTE REQUIRED
Adoption of the Director Stock Plan requires approval by holders of a
majority of the outstanding shares of Company Common Stock who are present, or
represented, and entitled to vote thereon, at the Annual Meeting of
Shareholders.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE "FOR" APPROVAL OF PROPOSAL 2.
PROPOSAL 3
APPROVAL OF THE
DEL WEBB CORPORATION 1995 EXECUTIVE LONG-TERM INCENTIVE PLAN
GENERAL
The Board of Directors has adopted a new stock plan entitled the "Del Webb
Corporation 1995 Executive Long-Term Incentive Plan" (the "Executive Long-Term
Incentive Plan") for key employees of the Company. The Executive Long-Term
Incentive Plan will become effective as of November 8, 1995, subject to approval
by the affirmative vote of the holders of the majority of Company Common Stock
present, or represented, and entitled to vote thereon, at the Annual Meeting of
Shareholders.
The Board of Directors believes that the Executive Long-Term Incentive Plan
will promote the success, and enhance the value, of the Company by linking the
personal interests of participants to those of Company shareholders and by
providing participants with an incentive for outstanding performance.
The Executive Long-Term Incentive Plan provides for the granting of stock
options, both incentive stock options and nonqualified stock options, restricted
stock, performance units, and performance-based awards to eligible key
employees. The summary of the principal provisions of the Executive Long-Term
Incentive Plan is set forth below. The summary is qualified by reference to the
full text of the Executive Long-Term Incentive Plan, which is attached as
Appendix B to this Proxy Statement.
ADMINISTRATION
The Executive Long-Term Incentive Plan shall be administered by the Human
Resources Committee of the Board, or by any other committee appointed by the
Board consisting of at least two nonemployee directors (the "Committee").
ELIGIBILITY
Persons eligible to participate in the Executive Long-Term Incentive Plan
include all officers and key employees of the Company and its subsidiaries, as
determined by the Committee, including employees who are members of the Board,
but excluding directors who are not employees. As of June 30, 1995, there were
approximately 80 officers and key employees of the Company and its subsidiaries.
LIMITATION ON AWARDS AND SHARES AVAILABLE
An aggregate of 1,200,000 shares of Company Common Stock are available for
grant under the Executive Long-Term Incentive Plan. Of such 1,200,000 shares, no
more than 100,000 shares of restricted stock may be granted under the Executive
Long-Term Incentive Plan. The maximum number of shares of Company Common Stock
that may be subject to one or more awards to a participant under the Executive
Long-Term Incentive Plan is 400,000. The maximum number of shares of Company
Common Stock payable in the form of performance-based awards for a performance
period is 75,000. As of September 11, 1995, the closing price of the Company's
Common Stock on The New York Stock Exchange was $19.25 per share.
AWARDS
The Executive Long-Term Incentive Plan provides for the grant of incentive
stock options, nonqualified stock options, restricted stock, performance units,
or performance-based awards. No determination has been made as to the types or
amounts of awards that will be granted to specific individuals under the
Executive Long-Term Incentive Plan. See the Summary Compensation Table and
Option Grants in Last Fiscal Year on pages 8 and 9, respectively, for
information on prior awards to named executive officers.
Stock options may be granted under the Executive Long-Term Incentive Plan,
including incentive stock options, as defined under Section 422 of the Internal
Revenue Code of 1986, as amended from time to time ("Code"), and nonqualified
stock options. The option exercise price of all stock options granted under the
Executive Long-Term Incentive Plan shall not be less than 100% of the fair
market value of the Company's Common Stock on the date of grant. Stock options
may be exercised as determined by the Committee, but in no event prior to six
months following the date of grant or after the tenth anniversary date of grant.
Upon exercise of a stock option, the purchase price must be paid in full in
either cash or its equivalent or by tendering previously acquired shares of
Company Common Stock with a fair market value at the time of exercise equal to
the exercise price (provided such shares have been held for at least six months
prior to tender). The Committee may also allow cashless exercise or by any other
means that the Committee determines to be consistent with the purpose of the
Executive Long-Term Incentive Plan as permitted under applicable law.
As discussed above, up to 100,000 shares of restricted stock may be granted
under the Executive Long-Term Incentive Plan. A restricted stock award is the
grant of shares of Common Stock at a price determined by the Committee
(including zero), which is nontransferable and subject to substantial risk of
forfeiture until specific conditions are met. In no event may shares of
restricted stock granted under the Executive Long-Term Incentive Plan vest prior
to six months following the date of grant. Conditions may be based on continuing
employment or achievement of performance goals. Certificates evidencing
restricted stock awards will bear a legend making reference to the restrictions.
During the period of restriction, participants holding shares of restricted
stock shall have full voting and dividend rights with respect to such shares.
The restrictions will lapse in accordance with a schedule or other conditions
determined by the Committee.
A performance unit is a contingent right to receive a pre-determined amount
if certain performance goals are met, determined at the close of a period of at
least six months over which performance is measured. The payment value of
performance units will depend on the degree to which the specified performance
goals are achieved. Payment of earned performance units will be made in a single
lump sum within 45 days after the end of the measurement period for the
performance unit. The Committee may, in its discretion, pay earned performance
units in cash, or stock, or a combination of both.
The amount of payments made to an employee will be the value of the
performance unit for the level of performance achieved multiplied by the number
of performance units earned by the participant. Prior to the beginning of each
measurement period for the performance unit, participants may elect to defer the
receipt of performance unit payout on terms acceptable to the Committee.
Grants of performance-based awards under the Plan enable the Committee to
treat restricted stock and performance unit awards granted under the Plan as
"performance-based compensation" under Section 162(m) of the Code and preserve
the deductibility of these awards for federal income tax purposes. Because
Section 162(m) of the Code only applies to those employees who are "covered
employees," as defined in Section 162(m) of the Code, only covered employees are
eligible to receive performance-based awards.
Participants for any given performance period are only entitled to receive
payment for a performance-based award for such period to the extent that
pre-established performance goals set by the Committee for the period are
satisfied. These pre-established performance goals must be based on one or more
of the following performance criteria: pre- or after- tax net earnings, revenue
growth, operating income, operating cash flow, return on net assets, return on
shareholders' equity, return on assets, return on capital, share price growth,
shareholder returns, gross or net profit margin, earnings per share, price per
share, and market share. These performance criteria may be measured in absolute
terms or as compared to any incremental increase or as compared to results of a
peer group. With regard to a particular performance period, the Committee shall
have the discretion to select the length of the performance period, the type of
performance-based awards to be granted, and the goals that will be used to
measure the performance for the period. In determining the actual size of an
individual performance-based award for a performance period, the Committee may
reduce or eliminate (but not increase) the award. Generally, a participant will
have to be employed on the last day of the performance period in order to be
eligible for a performance-based award for that period.
AMENDMENT AND TERMINATION
The Committee, subject to approval of the Board, may terminate, amend, or
modify the Executive Long-Term Incentive Plan at any time; provided, however,
that shareholder approval is required for any amendment that would increase the
total number of shares that may be issued under the Executive Long-Term
Incentive Plan; change the class of employees eligible to participate in the
Plan; materially increase the cost of or the benefits available under the Plan;
or extend the maximum period after the date of grant during which options or
other awards may be exercised.
In no event may an award be granted under the Executive Long-Term Incentive
Plan on or after November 8, 2005.
FEDERAL INCOME TAX CONSEQUENCES
A participant receiving incentive stock options, nonqualified stock options,
restricted stock, performance units, or performance-based awards will not
recognize taxable income at the time of grant. At the time the nonqualified
stock option is exercised, the restrictions lapse on restricted stock or
performance-based awards, or performance units or performance-based awards are
paid, as the case may be, the participant will recognize ordinary taxable income
in an amount equal to the difference between the amount paid for such award and
the fair market value of the Company's Common Stock or amount received on the
date of exercise or lapse of restriction. The Company will be entitled to a
concurrent deduction equal to the ordinary income recognized by the participant.
If applicable holding period requirements are met, a participant granted an
incentive stock option will not recognize taxable income at the time of
exercise. However, the excess of the fair market value of the Common Stock
received over the option price is an item of tax preference income potentially
subject to the alternative minimum tax. If stock acquired upon exercise of an
incentive stock option is held for a minimum of two years from the date of grant
and one year from the date of exercise, the gain or loss (in an amount equal to
the difference between the sales price and the exercise price) upon disposition
of the stock will be treated as long-term capital gain or loss, and the Company
will not be entitled to any deduction. If the holding period requirement is not
met, the incentive stock option will be treated as one which does not meet the
requirements of the Internal Revenue Code for incentive stock options and the
tax consequences described for nonqualified stock options will apply.
Special rules may apply with respect to participants subject to Section 16(b)
of the Securities Exchange Act of 1934, as amended.
CHANGE IN CONTROL
In the event of a change in control of the Company: (i) all options and other
share-based awards granted under the Executive Long-Term Incentive Plan shall
become immediately exercisable; (ii) any restriction periods and restrictions
imposed on restricted stock will lapse; (iii) the target value attainable under
all performance units and other performance-based awards shall be deemed to have
been fully earned, except for performance units or performance-based awards that
have been outstanding for less than six months; and (iv) the Committee may make
any modifications to awards that may be deemed to be appropriate before the
effective date of the change in control subject to shareholder approval
requirements set forth above. Under the Plan, a change in control occurs upon
any of the following events: (i) any person becoming the beneficial owner of 20%
or more of the Company's Common Stock; (ii) during any two-year period, the
persons who are on the Company's Board of Directors at the beginning of such
period and any new person elected by two-thirds of such directors cease to
constitute a majority of the persons serving on the Board of Directors; or (iii)
the Company's shareholders approve (a) a merger or consolidation of the Company
with another corporation (other than a merger in which 80% of the current
shareholders remain as shareholders of the new corporation), (b) a plan of
complete liquidation, or (c) a sale of substantially all of the Company's
assets.
VOTE REQUIRED
Adoption of the Executive Long-Term Incentive Plan requires approval by
holders of a majority of the outstanding shares of Company Common Stock who are
present, or represented, and entitled to vote thereon, at the Annual Meeting of
Shareholders.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE "FOR" APPROVAL OF PROPOSAL 3.
PROPOSAL 4
APPROVAL OF THE
DEL WEBB CORPORATION 1995 EXECUTIVE MANAGEMENT INCENTIVE PLAN
GENERAL
The Board of Directors has adopted the Del Webb Corporation 1995 Executive
Management Incentive Plan (the "Management Incentive Plan"). The Management
Incentive Plan will become effective as of July 1, 1995, subject to approval by
the affirmative vote of the holders of the majority of Company Common Stock
present, or represented, and entitled to vote, at the Annual Meeting of
Shareholders. If the Management Incentive Plan is not approved by the Company's
shareholders, it will not be effective and any grants made under the Plan prior
to that date will be void. No award may be made under the Management Incentive
Plan after its expiration date, but awards made prior thereto may extend beyond
that date.
The Management Incentive Plan will provide for annual incentive awards to
certain of the Company's key executives and is being submitted to shareholders
in an effort to assure that awards under the Management Incentive Plan will be
tax deductible for the Company. Section 162(m) of the Internal Revenue Code of
1986, as amended from time to time (the "Code") places a $1 million annual limit
on the amount of compensation paid to the named executive officers that may be
deducted by the Company for federal income tax purposes, unless such
compensation is based on the achievement of pre-established performance goal(s)
set by the Human Resources Committee of the Board pursuant to an incentive plan
that has been approved by the Company's shareholders.
Shareholder approval of the Management Incentive Plan is necessary for
maintaining the tax-deductible status of incentive payments made to the
participants, as well as to allow the Company to continue its long-standing
policy of recognizing and rewarding on an annual basis those key executives for
their contributions to the overall success of the Company.
The primary features of the Management Incentive Plan are summarized below.
The summary is qualified by reference to the full text of the Management
Incentive Plan, which is attached as Appendix C to this Proxy Statement.
ELIGIBILITY
Awards may be made under the Management Incentive Plan to any employee of the
Company who is a "covered employee" within the meaning of Section 162(m) of the
Code. A covered employee generally includes the Company's Chief Executive
Officer and the four other most highly compensated officers of the Company.
ADMINISTRATION
The Management Incentive Plan will be administered by the Human Resources
Committee of the Board of Directors or any other committee appointed by the
Board of Directors (the "Committee"), which consists of not less than two
non-employee directors who are ineligible to participate in the Management
Incentive Plan and are "outside directors" within the meaning of Section 162(m).
The Committee has full authority to interpret the Management Incentive Plan and
to establish rules for its administration. The Committee has the authority to
determine eligibility for participation in the Management Incentive Plan, to
decide all questions concerning eligibility for and the amount of awards, and to
establish and administer the performance goals (defined below) and certify
whether, and to what extent, they are attained.
DETERMINATION OF AWARDS
In determining awards to be made under the Management Incentive Plan, the
Committee may approve a formula which is based on one or more objective criteria
to measure corporate performance as set forth in the Management Incentive Plan
("Performance Criteria"). The Committee may establish Performance Criteria and
as selected by the Committee, the Committee may set one or more annual
performance objectives ("Performance Goal(s)") with respect to such Performance
Criteria for the Company. Performance Criteria must include one or more of the
following: the Company's pre- or after-tax net earnings, revenue growth,
operating income, operating cash flow, return on net assets, return on
shareholders' equity, return on assets, return on capital, share price growth,
shareholder returns, gross or net profit margin, earnings per share, price per
share and market share, any of which may be measured either in absolute terms,
or as compared to any incremental increase, or as compared to results of a peer
group. The Committee will also determine the amount and form of compensation
payable to the participant upon attainment of a Performance Goal before the
beginning of each Performance Period or within the time permitted under Section
162(m) of the Code.
Payment of awards will be made in cash. All determinations regarding the
achievement of Performance Goals and the determination of actual awards will be
made by the Committee. The Committee may in its discretion decrease, but not
increase, the amount of any award that otherwise would be payable under the
Management Incentive Plan.
AMOUNT AVAILABLE AND MAXIMUM INDIVIDUAL AWARDS
The amount available for awards in any year shall be determined by the
Committee. The aggregate maximum amount of cash compensation payable to a
participant under the Management Incentive Plan shall be $2,000,000.
AMENDMENT AND TERMINATION
The Committee may suspend or terminate the Plan at any time with or without
prior notice. In addition, the Committee may from time to time and with or
without prior notice, amend or modify the Plan in any manner, but may not
without shareholder approval adopt any amendment that would require the vote of
shareholders of the Company pursuant to Section 162(m) of the Code.
FEDERAL INCOME TAX CONSEQUENCES
The amount of cash received by a participant is required to be recognized by
such participant as ordinary income subject to withholding and will generally be
allowed as a deduction to the Company.
Section 162(m) limits the deduction of compensation in excess of $1 million
per year paid to certain of the Company's employees unless, among other
exceptions, the compensation is not performance-based compensation within the
meaning of that provision. The Internal Revenue Service has issued proposed
regulations under Section 162(m) (the "Proposed Regulations"), but there can be
no assurance that the final regulations will not differ materially from the
Proposed Regulations or that compensation paid under the Management Incentive
Plan will be deductible by the Company. The Company, however, believes that
Section 162(m), as interpreted by the Proposed Regulations, will not limit the
deduction of compensation payable pursuant to the Management Incentive Plan.
The Management Incentive Plan is not subject to any provision of the Employee
Retirement Income Security Act of 1974 and is not qualified under Section 401(a)
of the Code.
The preceding discussion of federal income tax consequences does not purport
to be a complete analysis of all of the potential tax effects of the Management
Incentive Plan. It is based upon laws, regulations, rulings, and decisions now
in effect, all of which are subject to change. No information is provided with
respect to foreign, state, or local tax laws, or estate and gift tax
considerations.
VOTE REQUIRED
Adoption of the Management Incentive Plan requires approval by holders of a
majority of the outstanding shares of Company Common Stock who are present, or
represented, and entitled to vote thereon, at the Annual Meeting of
Shareholders.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE "FOR" APPROVAL OF PROPOSAL 4.
PROPOSAL 5
RATIFICATION OF APPOINTMENT OF PRINCIPAL INDEPENDENT
PUBLIC ACCOUNTING FIRM
FOR THE YEAR ENDING
JUNE 30, 1996
The Board of Directors, upon the recommendation of the Audit Committee, has
appointed KPMG Peat Marwick LLP as the firm of independent certified public
accountants to audit the books and accounts of the Company and its consolidated
subsidiaries for the year ending June 30, 1996, subject to ratification by
shareholders.
A representative of KPMG Peat Marwick LLP is expected to be present at the
Annual Meeting, will have an opportunity to make a statement if such
representative desires to do so, and will be available to respond to appropriate
questions by shareholders.
THE BOARD OF DIRECTORS RECOMMENDS
A VOTE "FOR" APPROVAL OF PROPOSAL 5.
CERTAIN TRANSACTIONS
Mr. Rossi, a director of the Company, is Vice Chairman of BankAmerica
Corporation. The Company has various credit agreements with Bank of America, a
related entity, pursuant to which the Company made payments of $4,334,000 in
interest and fees during fiscal 1995.
OTHER MATTERS
The Board of Directors does not know of any other matter which is to be
presented for action at the meeting. The enclosed proxy confers upon the person
or persons entitled to vote the shares represented thereby discretionary
judgment with respect to matters which the Company is not aware of within a
reasonable time prior to the meeting and to the extent otherwise permissible by
law.
The proxies are being solicited by order of the Board of Directors of the
Company, and the cost of such solicitation will be borne by the Company.
Directors, officers or employees of the Company may solicit proxies by telephone
or in person without additional compensation. Arrangements may be made with
brokerage firms and nominees to mail proxy material to beneficial owners, and
the Company may reimburse brokers for their expenses and postage on the scale
established by the New York Stock Exchange. The Company has arranged for
Georgeson & Company, Inc. to assist in the solicitation of proxies, at an
anticipated cost of approximately $8,000 plus reasonable out-of-pocket expenses.
The Company's Annual Report for the fiscal year ended June 30, 1995, which
includes financial statements, is being mailed concurrently to all shareholders
of record as of September 11, 1995. It is not to be regarded as proxy soliciting
material.
SHAREHOLDER PROPOSALS
Shareholder proposals for the 1996 Annual Meeting must be received at the
principal executive offices of the Company, 6001 North 24th Street, Phoenix,
Arizona 85016, not later than May 24, 1996, to be considered for inclusion in
the 1996 Proxy Statement.
Shareholders are urged to mark, sign, date, and mail the proxy in the
enclosed envelope, postage for which has been provided. Your prompt response
will be appreciated.
DONALD V. MICKUS
Vice President, Secretary
and Treasurer
Dated: September 22, 1995
APPENDIX A
DEL WEBB CORPORATION
1995 DIRECTOR STOCK PLAN
ARTICLE 1. ESTABLISHMENT, PURPOSE, AND DURATION
1.1 Establishment of the Plan. Del Webb Corporation, a Delaware corporation
(the "Company"), hereby establishes a stock plan for Nonemployee Directors, to
be known as the "Del Webb Corporation 1995 Director Stock Plan" (the "Plan"), as
set forth in this document. The Plan permits the deferral of Directors' Annual
Retainers into grants of Nonqualified Stock Options and Restricted Stock, and
sets forth the terms of annual grants of Stock Options to Nonemployee Directors,
subject to the terms and provisions set forth herein.
Upon approval by the Board of Directors of the Company, and conditioned upon
subsequent approval of the Plan by the shareholders of the Company, the Plan
shall become effective as of November 8, 1995 (the "Effective Date"), and shall
remain in effect as provided in Section 1.3 herein. Without limiting the
immediately preceding sentence, the Plan and the grant of Awards thereunder will
be void ab initio, and of no force and effect, if the Plan is not approved by
the Company's shareholders on or before November 8, 1995.
1.2 Purpose of the Plan. The purpose of the Plan is to promote the
achievement of long-term objectives of the Company by linking the personal
interests of Nonemployee Directors to those of Company shareholders, and to
attract and retain Nonemployee Directors of outstanding competence.
1.3 Duration of the Plan. The Plan shall commence on the Effective Date, as
described in Section 1.1 herein, and shall remain in effect, subject to the
right of the Board of Directors to terminate the Plan at any time pursuant to
Article 9 or Section 10.3 herein, until all Shares subject to it shall have been
purchased or acquired according to the Plan's provisions. However, in no event
may an Award be granted under the Plan on or after November 7, 2005.
ARTICLE 2. DEFINITIONS AND CONSTRUCTION
2.1 Definitions. Whenever used in the Plan, the following terms shall have
the meanings set forth below and, when the meaning is intended, the initial
letter of the word is capitalized:
(a) "Annual Retainer" means the annual fee payable by the Company to a
Director, including amounts payable for service as a chairperson of a
committee of the Board, but excluding meeting fees.
(b) "Award" means, individually or collectively, a grant of Nonqualified
Stock Options or Restricted Stock under this Plan.
(c) "Beneficial Owner" shall have the meaning ascribed to such term in
Rule 13d-3 of the General Rules and Regulations under the Exchange Act.
(d) "Board" or "Board of Directors" means the Board of Directors of Del
Webb Corporation, and includes any committee of the Board of Directors
designated by the Board to administer part or all of this Plan.
(e) "Change in Control" of the Company shall be deemed to have occurred if
(i) any "person" (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act), other than a trustee or other fiduciary holding securities
under an employee benefit plan of the Company or a corporation owned directly
or indirectly by the stockholders of the Company in substantially the same
proportions as their ownership of stock of the Company, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing 20% or more
of the total voting power represented by the Company's then outstanding
Voting Securities (defined as any securities of the Company which vote
generally in the election of directors), or (ii) during any period of two
consecutive years, individuals who at the beginning of such period constitute
the Board of Directors of the Company and any new Director whose election by
the Board of Directors or nomination for election by the Company's
stockholders was approved by a vote of at least two-thirds (2/3) of the
Directors then still in office who either were directors at the beginning of
the period or whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority thereof, or (iii) the
stockholders of the Company approve a merger or consolidation of the Company
with any other corporation, other than a merger or consolidation which would
result in the Voting Securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into Voting Securities of the surviving entity) at least 80% of the
total voting power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of (in one transaction or a series of transactions) all or
substantially all the Company's assets.
(f) "Code" means the Internal Revenue Code of 1986, as amended from time
to time.
(g) "Committee" means the Human Resources Committee of the Board of
Directors, or any other committee appointed by the Board to administer this
Plan.
(h) "Company" means Del Webb Corporation, a Delaware corporation, or any
successor thereto as provided in Section 10.2 herein.
(i) "Director" means any individual who is a member of the Board of
Directors of the Company.
(j) "Disability" means a permanent and total disability, within the
meaning of Code Section 22(e)(3). To the extent permitted pursuant to Section
16 of the Exchange Act, Disability shall be determined by the Board in good
faith, upon receipt of sufficient competent medical advice from one or more
individuals, selected by the Board, who are qualified to give professional
medical advice.
(k) "Employee" means any full-time, nonunion, salaried employee of the
Company. For purposes of this Plan, an individual whose only employment
relationship with the Company is as a Director, shall not be deemed to be an
Employee.
(l) "Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor Act thereto.
(m) "Fair Market Value" means the average of the highest and lowest quoted
selling prices for Shares on the relevant date, or (if there were no sales on
such date) the weighted average of the means between the highest and lowest
quoted selling prices on the nearest day before and the nearest day after the
relevant date, as prescribed by Treasury Regulation Section 20.2031-2(b)(2),
as reported in the Wall Street Journal or a similar publication selected by
the Committee.
(n) "Grant Date" means the tenth (10th) day following the public release
of the Company's fiscal year-end earnings information.
(o) "Nonemployee Director" means any individual who is a member of the
Board of Directors of the Company, but who is not otherwise an Employee of
the Company.
(p) "Nonqualified Stock Option" or "NQSO" means an option to purchase
Shares, granted under Articles 6 or 7 herein, which is not intended to be an
incentive stock option qualifying under Code Section 422.
(q) "Option" means a Nonqualified Stock Option under this Plan.
(r) "Participant" means a Nonemployee Director of the Company who has
outstanding an Award granted under the Plan.
(s) "Period of Restriction" means the period during which the transfer of
Shares of Restricted Stock is limited in some way, and the Shares are subject
to a substantial risk of forfeiture, as provided in Article 6 herein.
(t) "Person" shall have the meaning ascribed to such term in Section
3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d) thereof,
including a "group" as defined in Section 13(d).
(u) "Restricted Stock" means an Award granted to a Nonemployee Director
pursuant to Article 6 herein.
(v) "Shares" means the shares of common stock of Del Webb Corporation.
2.2 Gender and Number. Except where otherwise indicated by the context, any
masculine term used herein also shall include the feminine; the plural shall
include the singular and the singular shall include the plural.
2.3 Severability. In the event that a court of competent jurisdiction
determines that any portion of this Plan is in violation of any statute, common
law, or public policy, then only the portions of this Plan that violate such
statute, common law, or public policy shall be stricken. All portions of this
Plan that do not violate any statute or public policy shall continue in full
force and effect. Further, any court order striking any portion of this Plan
shall modify the stricken terms as narrowly as possible to give as much effect
as possible to the intentions of the parties under this Plan.
ARTICLE 3. ADMINISTRATION
3.1 The Committee. The Plan shall be administered by the Committee,
subject to the restrictions set forth in this Plan.
3.2 Administration by the Committee. The Committee shall have full power,
discretion, and authority to interpret and administer this Plan in a manner
which is consistent with the Plan's provisions. However, in no event shall the
Committee have the power to (i) determine Plan eligibility, or to determine the
number, the price, the vesting period, or the timing of Awards to be made under
the Plan to any Participant, or (ii) take an action that would result in the
Awards not being treated as "formula awards" within the meaning of Rule
16b-3(c)(ii) or any successor provision promulgated pursuant to the Exchange
Act.
3.3 Decisions Binding. All determinations and decisions made by the Committee
pursuant to the provisions of the Plan, and all related orders or resolutions of
the Board, shall be final, conclusive, and binding on all persons, including the
Company, its stockholders, employees, Participants, and their estates and
beneficiaries.
ARTICLE 4. SHARES SUBJECT TO THE PLAN
4.1 Number of Shares. Subject to adjustment as provided in Section 4.3
herein, the total number of Shares available for grant under the Plan may not
exceed Seventy-Five Thousand (75,000). The Shares issued as Restricted Stock and
the Shares issued pursuant to the Options exercised under this Plan may be
authorized and unissued Shares or Shares reacquired by the Company, as
determined by the Committee.
4.2 Lapsed Awards. If any Option or Share of Restricted Stock granted under
this Plan terminates, expires, or lapses for any reason, any Shares subject to
purchase pursuant to such Option and any such Shares of Restricted Stock again
shall be available for the grant under the Plan.
4.3 Adjustments in Authorized Shares. In the event of any merger,
reorganization, consolidation, recapitalization, separation, liquidation, stock
dividend, split-up, Share combination, or other change in the corporate
structure of the Company affecting the Shares, the number and/or type of Shares
subject to any outstanding Award, the Option exercise price per Share under any
outstanding Option, will be automatically adjusted so that the proportionate
interests of the Participants will be maintained as before the occurrence of
such event. Any adjustment pursuant to this Section 4.3 will be conclusive and
binding for all purposes of this Plan.
ARTICLE 5. ELIGIBILITY AND PARTICIPATION
5.1 Eligibility. Persons eligible to participate in this Plan are limited
to Nonemployee Directors.
5.2 Actual Participation. All eligible Nonemployee Directors shall receive
grants of Options pursuant to Article 7 herein, and shall be given the
opportunity to defer all or a portion of their Annual Retainers into Options
and/or Restricted Stock, pursuant to the terms and provisions set forth in
Article 6 herein.
ARTICLE 6. DEFERRAL OF ANNUAL RETAINERS
6.1 Deferral Election. On or before December 31 of each year during the term
of this Plan, each Nonemployee Director shall have the ability to elect to defer
any portion or all of his or her Annual Retainer, pursuant to the terms of this
Article 6. Deferrals may, at the discretion of the Director, be made in the form
of discounted Options or Restricted Stock, or combination thereof.
The deferral election shall be irrevocable, and shall be made by means of a
written notice delivered to the Secretary of the Company on or before December
31 of the calendar year which ends prior to the beginning of the applicable
fiscal year. The deferral election shall state the percentage and/or dollar
amount of the Director's Annual Retainer, which is to be deferred, and shall
specify whether the deferral is to be in the form of discounted Stock Options or
Restricted Stock, or combination thereof.
Each deferral election by a Director shall correspond to the Annual Retainer
which is to be earned by the Director for the Company's fiscal year which begins
in the first calendar year following the calendar year in which the deferral
election is made. For example, a deferral election made by a Director on
December 31, 1995 will correspond to a deferral of an Annual Retainer which is
to be earned by the Director during the fiscal year beginning July 1, 1996, and
ending June 30, 1997.
The effective date of the Award grant relating to Annual Retainer deferrals
shall be the Grant Date which falls in the first calendar year following the
calendar year in which the applicable deferral election is made. Accordingly,
the Option price of Stock Options granted pursuant to Article 6 of this Plan
shall equal seventy-five percent (75%) of the Fair Market Value of Shares on the
Grant Date. Awards of Restricted Stock pursuant to Annual Retainer deferrals
under this Plan also shall be made on the Grant Date.
6.2 Terms of Stock Option Deferrals.
(a) Number of Shares under Option. The number of shares which may be
purchased under Options pursuant to Annual Retainer deferrals shall be
derived according to the following formula:
Amount of Deferral
Number of Shares = ------------------------------------------------
0.25 x Fair Market Value of Shares at Grant Date
The Option price for each Share granted pursuant to an Annual Retainer
deferral shall equal seventy-five percent (75%) of the Fair Market Value of a
Share on the Grant Date. Options are issued using this formula to give the
Director who is deferring his or her Annual Retainer an equivalent economic
value.
(b) Vesting of Options. Options granted under this Article 6 shall vest one
hundred percent (100%) at the end of the sixth month following the date of grant
of the Options.
(c) Individual Award Agreement. Each Option grant shall be evidenced by an
Individual Award Agreement that will not include any terms or conditions that
are inconsistent with the terms and conditions of this Plan.
(d) Duration of Options. Unless earlier terminated, forfeited, or surrendered
pursuant to a provision of this Plan, each Option shall expire on the tenth
(10th) anniversary date of its grant.
(e) Payment. Options shall be exercised by the delivery of a written notice
of exercise to the Secretary of the Company, setting forth the number of Shares
with respect to which the Option is to be exercised, accompanied by full payment
for the Shares.
The Option price upon exercise of any Option shall be payable to the Company
in full either: (a) in cash or its equivalent, or (b) by tendering previously
acquired Shares having a Fair Market Value at the time of exercise equal to the
total Option Price (provided that the Shares tendered upon Option exercise have
been held by the Participant for at least six (6) months prior to their tender
to satisfy the Option Price), or (c) by a combination of (a) and (b). The
proceeds from such a payment shall be added to the general funds of the Company
and shall be used for general corporate purposes.
(f) Restrictions on Share Transferability. To the extent necessary to ensure
that Awards granted hereunder comply with applicable law, the Committee shall
impose restrictions on any Shares acquired pursuant to the exercise of an Option
under this Plan, including, without limitation, restrictions under applicable
Federal securities laws, under the requirements of any stock exchange or market
upon which such Shares are then listed and/or traded, and under any blue sky or
state securities laws applicable to such Shares.
(g) Termination of Service on Board of Directors Due to Death, Disability, or
Retirement. In the event the service of a Participant on the Board is terminated
by reason of death, Disability, or retirement from the Board after attaining age
72, and if a portion of the Participant's Award is not fully vested as of the
date of termination of service on the Board, then the portion of the
Participant's Award which is exercisable as of the date of termination of
service on the Board shall be determined by prorating the Award according to the
following guidelines:
(i) The portion of the Award which is exercisable as of the date of
termination of service on the Board shall remain exercisable;
(ii) The percentage vesting of the portion of the Award which otherwise
would have vested at the end of the Company's fiscal year in which
termination of service on the Board occurs, will equal a fraction, the
numerator of which is the number of full weeks of service on the Board during
the Company's fiscal year in which termination occurs, and the denominator of
which is fifty-two (52); and
(iii) The portion of the Award which is scheduled to vest in a year which
begins after the end of the Company's fiscal year in which termination of
service on the Board occurs, and the portion of the Award that does not vest
in the Company's fiscal year in which termination of service on the Board
occurs, shall be forfeited by the Participant, and returned to the Company
(and shall once again be available for grant under the Plan).
To the extent an Option is exercisable as of the date of death (or as of the
date of termination by reason of Disability or retirement from the Board after
attaining age 72, as applicable), it shall remain exercisable at any time prior
to its expiration date, or for one (1) year after the date of death (or the date
of termination by reason of Disability or retirement from the Board after
attaining age 72, as applicable), whichever period is shorter, by the
Participant or such person or persons as shall have been named as the
Participant's legal representative or beneficiary, or by such persons that have
acquired the Participant's rights under the Option by will or by the laws of
descent and distribution.
(h) Termination of Service on Board of Directors for Other Reasons. If the
service of the Participant on the Board shall terminate for any reason other
than death, Disability, or retirement from the Board after attaining age 72, any
outstanding Options held by the Participant that are not exercisable as of the
date of termination immediately shall be forfeited to the Company (and shall
once again become available for grant under the Plan).
To the extent an Option is exercisable as of the date of termination of the
Participant's service on the Board under this Section 6.2(h), it shall remain
exercisable at any time prior to its expiration date, or for one (1) year after
the date the Participant's service on the Board terminates, whichever period is
shorter.
(i) Nontransferability of Options. No Option granted under this Plan may be
sold, transferred, pledged, assigned, or otherwise alienated or hypothecated,
other than by will, by the laws of descent and distribution, or pursuant to
Section 10.1 herein. Further, all Options granted to a Participant under this
Plan shall be exercisable during his or her lifetime only by such Participant.
6.3 Terms of Restricted Stock Deferrals.
(a) Grants of Restricted Stock. The number of shares of Restricted Stock
which shall be granted pursuant to an Annual Retainer deferral shall be derived
according to the following formula:
Amount of Deferral
Number of Shares = -----------------------------------------
Fair Market Value of Shares at Grant Date
Awards of Restricted Stock under this Plan shall be made on the Grant Date
which falls within the first (1st) calendar year following the calendar year in
which the applicable deferral election was made.
(b) Restricted Stock Agreement. Each Restricted Stock grant shall be
evidenced by a Restricted Stock Agreement that shall specify the Period of
Restriction, or Periods, the number of Restricted Stock Shares granted, and such
other provisions as the Committee shall determine.
(c) Transferability. Except as provided in this Section 6.3(c), the Shares of
Restricted Stock granted herein may not be sold, transferred, pledged, assigned,
or otherwise alienated or hypothecated (other than pursuant to Section 10.1
herein) until the end of the applicable Period of Restriction, as specified in
the Restricted Stock Agreement.
The Period of Restriction for Shares of Restricted Stock awarded pursuant to
this Article 6 shall end six (6) months following the Grant Date on which such
Shares were issued. All rights with respect to the Restricted Stock granted to a
Director under the Plan shall be available during his or her lifetime only to
such Director.
(d) Certificate Legend. Each certificate representing Shares of Restricted
Stock granted pursuant to the Plan may bear the following legend:
"The sale or other transfer of the Shares of Stock represented by this
certificate, whether voluntary, involuntary, or by operation of law, is subject
to certain restrictions on transfer as set forth in the Del Webb Corporation
1995 Director Stock Plan, and in a Restricted Stock Agreement. A copy of the
Plan and such Restricted Stock Agreement may be obtained from the Secretary of
Del Webb Corporation."
(e) Removal of Restrictions. Except as otherwise provided in this Plan,
Shares of Restricted Stock covered by each Restricted Stock grant made under the
Plan shall become freely transferable by the Participant after the last day of
the Period of Restriction. Once the Shares are released from the restrictions,
the Director shall be entitled to have the legend required by Section 6.3(d)
removed from his or her Share certificate.
(f) Voting Rights. During the Period of Restriction, Directors holding Shares
of Restricted Stock granted hereunder may exercise full voting rights
with respect to those Shares.
(g) Dividends and Other Distributions. During the Period of Restriction,
Directors holding Shares of Restricted Stock granted hereunder shall be entitled
to receive all dividends and other distributions paid with respect to those
Shares while they are so held. If any such dividends or distributions are paid
in Shares, the Shares shall be subject to the same restrictions on
transferability and forfeitability as the Shares of Restricted Stock with
respect to which they were paid.
(h) Termination of Service on Board of Directors Due to Death, Disability, or
Retirement. In the event that a Director's service on the Board terminates prior
to the end of the Period of Restriction by reason of death, Disability, or
retirement from the Board after attaining age 72, then the percentage vesting of
the Shares of Restricted Stock shall be determined according to a fraction; the
numerator of which is the number of full weeks of service on the Board between
the applicable Grant Date and the date the Director's service on the Board
terminates, and the denominator of which is twenty-six (26).
Within thirty (30) days after termination of service on the Board, the
Director (or his or her legal representative) shall return to the Company all of
the certificates representing Shares of Restricted Stock. As soon as practicable
thereafter, the Company shall issue a new certificate representing the number of
vested Shares to which the Director is entitled.
(i) Termination of Service on Board of Directors for Other Reasons. If the
service of a Director on the Board terminates prior to the end of the Period of
Restriction for reasons other than death, Disability, or retirement from the
Board after attaining age 72, then all Shares of Restricted Stock that are not
vested as of the date the Director's service on the Board terminates shall be
forfeited to the Company (and shall once again become available for grant under
the Plan). Within thirty (30) days after the termination of service on the
Board, the Director shall return to the Company all of the certificates
representing his or her Shares of Restricted Stock.
ARTICLE 7. ANNUAL OPTION GRANTS
7.1 Annual Grant of Options. Subject to the limitation on the number of
Shares which may be awarded under this Plan, each Nonemployee Director shall be
granted an Option to purchase two thousand (2,000) Shares upon each November 20
of each calendar year commencing in 1995 (less the number of shares granted to
the Director under the Del Webb Corporation Director Stock Plan during each such
calendar year).
7.2 Limitation on Grant of Options. Other than the grant of Options set forth
in Article 6 and in Section 7.1, no additional Options shall be granted under
this Plan.
7.3 Individual Award Agreement. Each Option grant shall be evidenced by an
Individual Award Agreement that will not include any terms or conditions that
are inconsistent with the terms and conditions of this Plan.
7.4 Option Price. The purchase price per Share available for purchaser under
an Option granted pursuant to this Article 7 shall be equal to the Fair Market
Value of such Share on the date the Option is granted.
7.5 Duration of Options. Unless earlier terminated, forfeited, or surrendered
pursuant to a provision of this Plan, each Option granted under this Article 7
shall expire on the tenth (10th) anniversary date of its grant.
7.6 Vesting of Shares Subject to Option. Participants shall be entitled to
exercise Options granted under this Article 7 at any time and from time to time,
within the time period beginning six (6) months after grant of the Option, and
ending ten (10) years after grant of the Option, and according to the following
vesting schedule: one-third of the Options shall vest on the anniversary date of
date of grant of the Options, and one-third of the Options shall vest on each of
the second and third anniversaries of the date of grant of the Options.
7.7 Payment. Options granted under this Article 7 shall be exercised in the
manner set forth in Section 6.2(e) herein.
7.8 Restrictions on Share Transferability. To the extent necessary to ensure
that Options granted under this Article 7 comply with applicable law, the Board
shall impose restrictions on any Shares acquired pursuant to the exercise of an
Option under this Article 7, including, without limitation, restrictions under
applicable Federal securities laws, under the requirements of any stock exchange
or market upon which such Shares are then listed and/or traded, and under any
blue sky or state securities laws applicable to such Shares.
7.9 Termination of Employment Due to Death, Disability, or Retirement. In the
event the service of a Participant on the Board is terminated by reason of
death, Disability, or retirement from the Board after attaining age 72, and if a
portion of the Participant's Award is not fully vested as of the date of
termination of service on the Board, then the portion of the Participant's Award
which is exercisable as of the date of termination of service on the Board shall
be determined according to the guidelines set forth in Section 6.2(g) herein.
7.10 Termination of Service on the Board of Directors for Other Reasons. If
the service of a Participant on the Board shall terminate for any reason other
than for death, Disability or retirement from the Board after attaining age 72,
any outstanding Options held by the Participant that are not exercisable as of
the date of termination shall be governed by the guidelines set forth in Section
6.2(h) herein.
7.11 Nontransferability of Options. No Option granted under this Article 7
may be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated, other than by will or by the laws of descent and distribution, or
pursuant to Section 10.1 herein. Further, all Options granted to a Participant
under this Article 7 shall be exercisable during his or her lifetime only by
such Participant.
ARTICLE 8. CHANGE IN CONTROL
In the event of a Change in Control of the Company, all Awards granted under
this Plan that are still outstanding and not yet vested, shall become
immediately one hundred percent (100%) vested in each Participant, as of the
first date that the definition of Change in Control has been fulfilled, and
shall remain as such for the remaining life of the Award, as such life is
provided herein, and within the provisions of the related individual award
agreements entered into with each Participant. All Options that are exercisable
as of the effective date of the Change in Control shall remain as such for the
remaining life of the Options.
ARTICLE 9. AMENDMENT, MODIFICATION, AND TERMINATION
9.1 Amendment, Modification, and Termination. Subject to the terms set forth
in this Section 9.1, the Committee may terminate, amend, or modify this Plan at
any time and from time to time; provided, however, that shareholder approval is
required for any Plan amendment that would materially increase the benefits
accruing to Participants under this Plan, materially increase the number of
securities which may be issued under this Plan, or materially modify the
requirements with respect to eligibility for participation in this Plan; and
provided, further, that Plan provisions relating to the amount, price, and
timing of securities to be awarded under this Plan may not be amended more than
once every six (6) months, other than to comport with changes in the Code or the
regulations promulgated thereunder.
9.2 Awards Previously Granted. Unless required by law, no termination,
amendment, or modification of this Plan shall in any manner adversely affect any
Award previously granted under this Plan, without the written consent of the
Participant holding such Award.
ARTICLE 10. MISCELLANEOUS
10.1 Beneficiary Designation. Each Participant under this Plan may, from time
to time, name any beneficiary or beneficiaries (who may be named contingently or
successively) to whom any benefit under this Plan is to be paid in the event of
his or her death. Each designation will revoke all prior designations by the
same Participant, shall be in a form prescribed by the Committee, and will be
effective only when filed by the Participant in writing with the Committee
during his or her lifetime. In the absence of any such designation, benefits
remaining unpaid at the Participant's death shall be paid to the Participant's
estate.
10.2 Successors. All obligations of the Company under this Plan, with respect
to Awards granted hereunder, shall be binding on any successor to the Company,
whether the existence of such successor is the result of a direct or indirect
purchase, merger, consolidation, or otherwise, of all or substantially all of
the business and/or assets of the Company.
10.3 Requirements of Law. The granting of Awards under the Plan shall be
subject to all applicable laws, rules, and regulations, and to such approvals by
any governmental agencies or national securities exchanges as may be required.
Notwithstanding any other provision set forth in this Plan, the Committee may,
at its sole discretion, terminate, amend, or modify this Plan in any way
necessary to comply with the applicable requirements of Rule 16b-3 promulgated
by the Securities and Exchange Commission as interpreted pursuant to no-action
letters and interpretive releases.
10.4 Governing Law. This Plan, and all agreements hereunder, shall be
governed by the laws of the State of Delaware.
APPENDIX B
DEL WEBB CORPORATION
1995 EXECUTIVE LONG-TERM INCENTIVE PLAN
ARTICLE 1. ESTABLISHMENT, PURPOSE, AND DURATION
1.1 Establishment of the Plan. Del Webb Corporation, a Delaware corporation
(hereinafter referred to as the "Company"), hereby establishes an incentive
compensation plan to be known as the "Del Webb Corporation 1995 Executive
Long-Term Incentive Plan" (hereinafter referred to as the "Plan"), as set forth
in this document. The Plan permits the grant of Nonqualified Stock Options,
Incentive Stock Options, Restricted Stock, Performance Units, and
Performance-Based Awards.
Upon approval by the Board of Directors of the Company and subject to
shareholder ratification, the Plan shall become effective as of November 8, 1995
(the "Effective Date"), and shall remain in effect as provided in Section 1.3
herein.
1.2 Purpose of the Plan. The purpose of the Plan is to promote the success,
and enhance the value, of the Company by linking the personal interests of
participants to those of Company shareholders, and by providing Participants
with an incentive for outstanding performance.
The Plan is further intended to provide flexibility to the Company in its
ability to motivate, attract, and retain the services of Participants upon whose
judgment, interest, and special effort the successful conduct of its operation
largely is dependent.
1.3 Duration of the Plan. Subject to approval by the Board of Directors of
the Company and ratification by the shareholders of the Company, the Plan shall
commence on the Effective Date, as described in Section 1.1 herein, and shall
remain in effect, subject to the right of the Board of Directors to terminate
the Plan at any time pursuant to Article 14 herein, until all Shares subject to
it shall have been purchased or acquired according to the Plan's provisions.
However, in no event may an Award be granted under the Plan on or after November
7, 2005.
ARTICLE 2. DEFINITIONS AND CONSTRUCTION
2.1 Definitions. Whenever used in the Plan, the following terms shall have
the meanings set forth below and, when the meaning is intended, the initial
letter of the word is capitalized:
(a) "Award" means, individually or collectively, a grant under this Plan
of Nonqualified Stock Options, Incentive Stock Options, Restricted Stock,
Performance Units, or Performance-Based Awards.
(b) "Beneficial Owner" shall have the meaning ascribed to such term in
Rule 13d-3 of the General Rules and Regulations under the Exchange Act.
(c) "Board" or "Board of Directors" means the Board of Directors of Del
Webb Corporation.
(d) "Cause" means: (i) willful and gross misconduct on the part of a
Participant that is materially and demonstrably detrimental to the Company;
or (ii) the commission by a Participant of one or more acts which constitute
an indictable crime under United States Federal, state, or local law. "Cause"
under either (i) or (ii) shall be determined in good faith by the Committee
in the exercise of its discretion.
(e) "Change in Control" of the Company shall be deemed to have occurred if
(i) any "person" (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act), other than a trustee or other fiduciary holding securities
under an employee benefit plan of the Company or a corporation owned directly
or indirectly by the stockholders of the Company in substantially the same
proportions as their ownership of stock of the Company, is or becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing 20% or more
of the total voting power represented by the Company's then outstanding
Voting Securities (defined as any securities of the Company which vote
generally in the election of directors), or (ii) during any period of two
consecutive years, individuals who at the beginning of such period constitute
the Board of Directors of the Company and any new director whose election by
the Board of Directors or nomination for election by the Company's
stockholders was approved by a vote of at least two-thirds (2/3) of the
directors then still in office who either were directors at the beginning of
the period or whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority thereof, or (iii) the
stockholders of the Company approve a merger or consolidation of the Company
with any other corporation, other than a merger or consolidation which would
result in the Voting Securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into Voting Securities of the surviving entity) at least 80% of the
total voting power represented by the Voting Securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation, or the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of (in one transaction or a series of transactions) all or
substantially all the Company's assets.
(f) "Code" means the Internal Revenue Code of 1986, as amended from time
to time.
(g) "Committee" means the committee, as specified in Article 3, appointed
by the Board to administer the Plan with respect to grants of Awards.
(h) "Company" means Del Webb Corporation, a Delaware corporation
(including any and all Subsidiaries), or any successor thereto as provided in
Article 16 herein.
(i) "Covered Employee" means an Employee who is a "covered employee"
within the meaning of Section 162(m) of the Code.
(j) "Director" means any individual who is a member of the Board of
Directors of the Company.
(k) "Disability" means a permanent and total disability, within the
meaning of Code Section 22(e)(3), as determined by the Committee in good
faith, upon receipt of sufficient competent medical advice from one or more
individuals, selected by the Committee, who are qualified to give
professional medical advice.
(l) "Employee" means any full-time, nonunion employee of the Company.
Directors who are not otherwise employed by the Company shall not be
considered Employees under this Plan.
(m) "Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor Act thereto.
(n) "Fair Market Value" means the average of the highest and lowest quoted
selling prices for Shares on the relevant date, or (if there were no sales on
such date) the weighted average of the means between the highest and lowest
quoted selling prices on the nearest day before and the nearest day after the
relevant date, as prescribed by Treasury Regulation Section 20.2031-2(b)(2),
as reported in the Wall Street Journal or a similar publication selected by
the Committee.
(o) "Incentive Stock Option" or "ISO" means an option to purchase Shares,
granted under Article 6 herein, which is designated as an Incentive Stock
Option and is intended to meet the requirements of Section 422 of the Code.
(p) "Insider" shall mean an Employee who is, at the time an Award is made
under this Plan, an insider pursuant to Section 16 of the Exchange Act.
(q) "Nonqualified Stock Option" or "NQSO" means an option to purchase
Shares, granted under Article 6 herein, which is not intended to be an
Incentive Stock Option.
(r) "Option" means an Incentive Stock Option or a Nonqualified Stock
Option.
(s) "Option Price" means the price at which a Share may be purchased by a
Participant pursuant to an Option, as determined by the Committee.
(t) "Parent" shall have the meaning ascribed to such term in Rule 12b-2 of
the General Rules and Regulations under the Exchange Act.
(u) "Participant" means an Employee of the Company who has outstanding an
Award granted under the Plan.
(v) "Performance-Based Awards" means the Restricted Stock Awards and
Performance Unit Awards granted to selected Covered Employees pursuant to
Articles 7 and 8, but which are subject to the terms and conditions set forth
in Article 9. All Performance-Based Awards are intended to qualify as
"performance-based compensation" under Section 162(m) of the Code.
(w) "Performance Criteria" means the criteria that the Committee selects
for purposes of establishing the Performance Goal or Performance Goals for a
Participant for a Performance Period. The Performance Criteria that will be
used to establish Performance Goals are limited to the following: pre- or
after-tax net earnings, revenue growth, operating income, operating cash
flow, return on net assets, return on shareholders' equity, return on assets,
return on capital, Share price growth, shareholder returns, gross or net
profit margin, earnings per share, price per Share, and market share, any of
which may be measured either in absolute terms or as compared to any
incremental increase or as compared to results of a peer group. The Committee
shall, within the time prescribed by Section 162(m) of the Code, define in an
objective fashion the manner of calculating the Performance Criteria it
selects to use for such Performance Period for such Participant.
(x) "Performance Goals" means, for a Performance Period, the goals
established in writing by the Committee for the Performance Period based upon
the Performance Criteria. Depending on the Performance Criteria used to
establish such Goal, the Goal may be expressed in terms of overall Company
performance or the performance of an operating unit or community. The
Committee, in its discretion, may, within the time prescribed by Section
162(m) of the Code, adjust or modify the calculation of Performance Goals for
such Performance Period in order to prevent the dilution or enlargement of
the rights of Participants, (i) in the event of, or in anticipation of, any
unusual or extraordinary corporate item, transaction, event, or development;
and (ii) in recognition of, or in anticipation of, any other unusual or
nonrecurring events affecting the Company, or the financial statements of the
Company, or in response to, or in anticipation of, changes in applicable
laws, regulations, accounting principles, or business conditions.
(y) "Performance Period" means the one or more periods of time, which may
be of varying and overlapping durations, as the Committee may select, over
which the attainment of one or more Performance Goals will be measured for
the purpose of determining a Participant's right to, and the payment of, a
Performance-Based Award.
(z) "Performance Unit" means an Award granted to an Employee pursuant to
Article 8 herein.
(aa) "Period of Restriction" means the period during which the transfer of
Shares of Restricted Stock is limited in some way (based on the passage of
time, the achievement of performance goals, or upon the occurrence of other
events as determined by the Committee, at its discretion), and the Shares are
subject to a substantial risk of forfeiture, as provided in Article 7 herein.
(bb) "Restricted Stock" means an Award granted to a Participant pursuant
to Article 7 herein.
(cc) "Retirement" means a voluntary termination of employment by a
Participant who has less than ten (10) years of service with the Company at
or after age sixty-five (65), or voluntary termination at or after age
fifty-five (55) for Participants who have at least ten (10) years of service
with the Company as of the date of employment termination.
(dd) "Shares" means the shares of common stock of Del Webb Corporation.
(ee) "Subsidiary" means any corporation in which the Company owns
directly, or indirectly through subsidiaries, at least fifty percent (50%) of
the total combined voting power of all classes of stock, or any other entity
(including, but not limited to, partnerships and joint ventures) in which the
Company owns at least fifty percent (50%) of the combined equity thereof.
2.2 Gender and Number. Except where otherwise indicated by the context, any
masculine term used herein also shall include the feminine; the plural shall
include the singular and the singular shall include the plural.
2.3 Severability. In the event that a court of competent jurisdiction
determines that any portion of this Plan is in violation of any statute, common
law, or public policy, then only the portions of this Plan that violate such
statute, common law, or public policy shall be stricken. All portions of this
Plan that do not violate any statute or public policy shall continue in full
force and effect. Further, any court order striking any portion of this Plan
shall modify the stricken terms as narrowly as possible to give as much effect
as possible to the intentions of the parties under this Plan.
ARTICLE 3. ADMINISTRATION
3.1 The Committee. The Plan shall be administered by the Human Resources
Committee of the Board, or by any other Committee appointed by the Board
consisting of not less than two (2) Directors who are not Employees. The members
of the Committee shall be appointed from time to time by, and shall serve at the
discretion of, the Board of Directors.
Except as permitted under Section 16b-3(c)(2)(i)(A), (B), (C), and (D) of the
Exchange Act, no member of the Committee shall have received a grant of an Award
under the Plan or any similar Plan of the Company or any of its Subsidiaries
while serving on the Committee, or shall have so received such a grant at any
time within one (l) year prior to his or her service on the Committee, or, if
different, for the time period just necessary to fulfill the then current Rule
16b-3 requirements under the Exchange Act. However, if for any reason the
Committee does not qualify to administer the Plan, as contemplated by Rule 16b-3
of the Exchange Act, the Board of Directors may appoint a new Committee so as to
comply with Rule 16b-3.
3.2 Authority of the Committee. The Committee shall have full power except as
limited by law or by the Articles of Incorporation or Bylaws of the Company, and
subject to the provisions herein, to determine the size and types of Awards; to
determine the terms and conditions of such Awards in a manner consistent with
the Plan; to cancel and reissue any Awards granted hereunder in the event the
Award lapses for any reason (provided that the Committee shall not have the
authority to reprice previously issued and currently outstanding Awards without
shareholder approval); to construe and interpret the Plan and any agreement or
instrument entered into under the Plan; to establish, amend, or waive rules and
regulations for the Plan's administration; and (subject to the provisions of
Article 14 herein) to amend the terms and conditions of any outstanding Award to
the extent such terms and conditions are within the discretion of the Committee
as provided in the Plan. Further, the Committee shall make all other
determinations which may be necessary or advisable for the administration of the
Plan. As permitted by law, the Committee may delegate its authorities as
identified hereunder.
3.3 Decisions Binding. All determinations and decisions made by the Committee
pursuant to the provisions of the Plan and all related orders or resolutions of
the Board of Directors shall be final, conclusive, and binding on all persons,
including the Company, its stockholders, Employees, Participants, and their
estates and beneficiaries.
ARTICLE 4. SHARES SUBJECT TO THE PLAN
4.1 Number of Shares. Subject to adjustment as provided in Section 4.3
herein, the total number of Shares available for grant under the Plan may not
exceed One Million Two Hundred Thousand (1,200,000). These One Million Two
Hundred Thousand (1,200,000) Shares may be either authorized but unissued or
reacquired Shares.
4.2 Lapsed Awards. If any Award granted under this Plan is canceled,
terminates, expires, or lapses for any reason, any Shares subject to such Award
again shall be available for the grant of an Award under the Plan.
4.3 Adjustments in Authorized Shares. In the event of any merger,
reorganization, consolidation, recapitalization, separation, liquidation, stock
dividend, split-up, Share combination, or other change in the corporate
structure of the Company affecting the Shares, such adjustment shall be made in
the number and class of Shares which may be delivered under the Plan, and in the
number and class of and/or price of Shares subject to outstanding Options and
Restricted Stock granted under the Plan, as may be determined to be appropriate
and equitable by the Committee, in its sole discretion, to prevent dilution or
enlargement of rights; and provided that the number of Shares subject to any
Award shall always be a whole number.
4.4 Limitation on Number of Shares Subject to Award. Notwithstanding any
provision in the Plan to the contrary, the maximum number of shares of Stock
that may be subject to one or more Awards granted to any one Participant over
the term of the Plan shall be 400,000.
ARTICLE 5. ELIGIBILITY AND PARTICIPATION
5.1 Eligibility. Persons eligible to participate in this Plan include all
officers and key Employees of the Company, as determined by the Committee,
including Employees who are members of the Board, but excluding Directors who
are not Employees
5.2 Actual Participation. Subject to the provisions of the Plan, the
Committee may, from time to time, select from all eligible Employees, those to
whom Awards shall be granted and shall determine the nature and amount of each
Award. No Employee shall have any right to be granted an Award under this Plan.
In addition, nothing in this Plan shall interfere with or limit in any way the
right of the Company to terminate any Participant's employment at any time, nor
confer upon any Participant any right to continue in the employ of the Company.
ARTICLE 6. STOCK OPTIONS
6.1 Grant of Options. Subject to the terms and provisions of the Plan,
Options may be granted to Employees at any time and from time to time as shall
be determined by the Committee. The Committee shall have discretion in
determining the number of Shares subject to Options granted to each Participant.
The Committee may grant ISOs, NQSOs, or a combination thereof. Nothing in this
Article 6 shall be deemed to prevent the grant of NQSOs in excess of the maximum
established by Section 422(d) of the Code.
6.2 Option Agreement. Each Option grant shall be evidenced by an Option
Agreement that shall specify the Option Price, the duration of the Option, the
number of Shares to which the Option pertains, and such other provisions as the
Committee shall determine. The Option Agreement also shall specify whether the
Option is intended to be an ISO within the meaning of Section 422 of the Code,
or a NQSO whose grant is intended not to fall under the provisions of Section
422 of the Code.
6.3 Option Price. The Option Price for each grant of an Option shall not be
less than one hundred percent (100%) of the Fair Market Value of such Share on
the date the Option is granted.
6.4 Duration of Options. Each Option shall expire at such time as the
Committee shall determine at the time of grant; provided, however, that no
Option shall be exercisable later than the tenth (10th) anniversary date of its
grant.
6.5 Exercise of Options. Options granted under the Plan shall be exercisable
at such times and be subject to such restrictions and conditions as the
Committee shall in each instance approve, which need not be the same for each
grant or for each Participant. However, in no event may any Option granted under
this Plan become exercisable prior to six (6) months following the date of its
grant.
6.6 Payment. Options shall be exercised by the delivery of a written notice
of exercise to the Secretary of the Company, setting forth the number of Shares
with respect to which the Option is to be exercised, accompanied by full payment
for the Shares.
The Option Price upon exercise of any Option shall be payable to the Company
in full either: (a) in cash or its equivalent, or (b) by tendering previously
acquired Shares having a Fair Market Value at the time of exercise equal to the
total Option Price (provided that the Shares which are tendered must have been
held by the Participant for at least six (6) months prior to their tender to
satisfy the Option Price), or (c) by a combination of (a) and (b).
The Committee also may allow cashless exercise as permitted under Federal
Reserve Board's Regulation T, subject to applicable securities law restrictions,
or by any other means which the Committee determines to be consistent with the
Plan's purpose and applicable law. The proceeds from such a payment shall be
added to the general funds of the Company and shall be used for general
corporate purposes.
As soon as practicable after receipt of a written notification of exercise
and full payment, the Company shall deliver to the Participant, in the
Participant's name, Share certificates in an appropriate amount based upon the
number of Shares purchased under the Option(s).
6.7 Restrictions on Share Transferability. The Committee shall impose such
restrictions on any Shares acquired pursuant to the exercise of an Option under
the Plan, as it may deem advisable, including, without limitation, restrictions
under applicable Federal securities laws, under the requirements of any stock
exchange or market upon which such Shares are then listed and/or traded, and
under any blue sky or state securities laws applicable to such Shares.
6.8 Termination of Employment Due to Death, Disability, or Retirement.
(a) Termination by Death. In the event the employment of a Participant is
terminated by reason of death, any outstanding Options granted to that
Participant which are vested as of the date of death shall remain exercisable
at any time prior to their expiration date, or for one (1) year after the
date that employment was terminated, whichever period is shorter, by such
person or persons as shall have been named as the Participant's beneficiary,
or by such persons that have acquired the Participant's rights under the
Option by will or by the laws of descent and distribution.
The portion of any outstanding Option which is deemed vested under this
Plan as of the date of employment termination shall be determined according
to the following guidelines:
(i) The portion of the Option which is exercisable as of the date of
employment termination shall remain exercisable;
(ii) The percentage vesting of the portion of the Option which otherwise
would have vested at the end of the calendar year in which employment
termination occurs, will equal a fraction, the numerator of which is the
number of full weeks of employment during the calendar year in which
employment termination occurs, and the denominator of which is fifty-two
(52); and
(iii) The portion of the Option which is scheduled to vest in a year which
begins after the end of the calendar year in which employment termination
occurs, and the portion of the Option that does not vest in the year in which
employment termination occurs, shall be forfeited by the Participant and
returned to the Company (and shall once again be available for grant under
the Plan).
Any Options which are not vested as of the date of employment termination
shall expire immediately, and may not be exercised following such time.
(b) Termination by Disability. In the event the employment of a
Participant is terminated by reason of Disability, any outstanding Options
granted to that Participant which are vested as of the date the Committee
determines the definition of Disability to have been satisfied, shall remain
exercisable at any time prior to their expiration date, or for one (l) year
after the date that the Committee determines the definition of Disability to
have been satisfied, whichever period is shorter.
The portion of any outstanding Option which is deemed vested as of the date
the definition of Disability is determined to have been satisfied by the
Committee shall be determined pursuant to the guidelines set forth in
Subparagraphs (a)(i) through (a)(iii) of this Section 6.8.
Any Options that are not vested as of the date that the Committee determines
the definition of Disability to have been satisfied, shall expire immediately,
and may not be exercised following such date.
(c) Termination by Retirement. In the event the employment of a
Participant is terminated by reason of Retirement, any outstanding Options
granted to that Participant which are vested as of the effective date of
Retirement, shall remain exercisable at any time prior to their expiration
date, or for three (3) years after the effective date of Retirement,
whichever period is shorter.
The portion of any outstanding Option which is deemed vested as of the
effective date of Retirement shall be determined pursuant to the guidelines set
forth in Subparagraphs a(i) through a(iii) of this Section 6.8.
Any Options which are not vested as of the effective date of Retirement shall
expire immediately, and may not be exercised following such date.
(d) Exercise Limitations on ISOs. In the case of ISOs, the tax treatment
prescribed under Section 422 of the Code may not be available if the Options
are not exercised within the Section 422 prescribed time periods after each
of the various types of employment termination.
Notwithstanding the exercise periods described in Subparagraphs (a), (b), and
(c) above, the Committee shall have the authority, in its sole discretion, to
accelerate the vesting of Options which are outstanding as of the date of
employment termination for one of the reasons described in this Section 6.8.
6.9 Termination of Employment for Other Reasons. If the employment of a
Participant shall terminate for any reason (other than the reasons set forth in
Section 6.8 or for Cause), all Options held by the Participant which are not
vested as of the effective date of employment termination immediately shall be
forfeited to the Company (and shall once again become available for grant under
the Plan). However, the Committee, in its sole discretion, shall have the right
to immediately vest all or any portion of such Options, subject to such terms as
the Committee, in its sole discretion, deems appropriate.
Options which are vested as of the effective date of employment termination
may be exercised by the Participant within the period beginning on the effective
date of employment termination, and ending three (3) months after such date.
If the employment of a Participant shall terminate for Cause, all outstanding
Options held by the Participant immediately shall be forfeited to the Company
and no additional exercise period shall be allowed, regardless of the vested
status of the Options.
6.10 Nontransferability of Options. Each Incentive Stock Option granted under
the Plan may not be sold, transferred, pledged, assigned, or otherwise alienated
or hypothecated, other than by will or by the laws of descent and distribution;
each other Option granted under the Plan may be transferable subject to the
terms and conditions as may be established by the Committee in accordance with
the regulations promulgated under the Exchange Act, or any other applicable law
or regulation. Further, all Options granted to a Participant under the Plan
shall be exercisable during his or her lifetime only by such Participant.
ARTICLE 7. RESTRICTED STOCK
7.1 Grant of Restricted Stock. Subject to the terms and provisions of the
Plan, the Committee, at any time and from time to time, may grant Shares of
Restricted Stock to eligible Employees in such amounts as the Committee shall
determine; provided that the total number of Shares of Restricted Stock granted
under this Plan shall not exceed One Hundred Thousand (100,000) Shares of
Restricted Stock.
7.2 Restricted Stock Agreement. Each Restricted Stock grant shall be
evidenced by a Restricted Stock Agreement that shall specify the Period of
Restriction, or Periods, the number of Restricted Stock Shares granted, and such
other provisions as the Committee shall determine.
7.3 Transferability. Except as provided in this Article 7, the Shares of
Restricted Stock granted herein may not be sold, transferred, pledged, assigned,
or otherwise alienated or hypothecated until the end of the applicable Period of
Restriction established by the Committee and specified in the Restricted Stock
Agreement, or upon earlier satisfaction of any other conditions, as specified by
the Committee in its sole discretion and set forth in the Restricted Stock
Agreement. However, in no event may any Restricted Stock granted under the Plan
become vested in a Participant prior to six (6) months following the date of its
grant. All rights with respect to the Restricted Stock granted to a Participant
under the Plan shall be available during his or her lifetime only to such
Participant.
7.4 Other Restrictions. The Committee shall impose such other restrictions on
any Shares of Restricted Stock granted pursuant to the Plan as it may deem
advisable including, without limitation, restrictions based upon the achievement
of specific performance goals (Company-wide, divisional, and/or individual),
and/or restrictions under applicable Federal or state securities laws; and may
legend the certificates representing Restricted Stock to give appropriate notice
of such restrictions.
7.5 Certificate Legend. In addition to any legends placed on certificates
pursuant to Section 7.4 herein, each certificate representing Shares of
Restricted Stock granted pursuant to the Plan may bear the following legend:
"The sale or other transfer of the Shares of Stock represented by this
certificate, whether voluntary, involuntary, or by operation of law, is
subject to certain restrictions on transfer as set forth in the Del Webb
Corporation 1995 Executive Long-Term Incentive Plan, and in a Restricted
Stock Agreement. A copy of the Plan and such Restricted Stock Agreement
may be obtained from the Secretary of Del Webb Corporation."
7.6 Removal of Restrictions. Except as otherwise provided in this Article 7,
Shares of Restricted Stock covered by each Restricted Stock grant made under the
Plan shall become freely transferable by the Participant after the last day of
the Period of Restriction. Once the Shares are released from the restrictions,
the Participant shall be entitled to have the legend required by Section 7.5
removed from his or her Share certificate.
7.7 Voting Rights. During the Period of Restriction, Participants holding
Shares of Restricted Stock granted hereunder may exercise full voting rights
with respect to those Shares.
7.8 Dividends and Other Distributions. During the Period of Restriction,
Participants holding Shares of Restricted Stock granted hereunder shall be
entitled to receive all dividends and other distributions paid with respect to
those Shares while they are so held. If any such dividends or distributions are
paid in Shares, the Shares shall be subject to the same restrictions on
transferability and forfeitability as the Shares of Restricted Stock with
respect to which they were paid.
7.9 Termination of Employment. If the employment of a Participant shall
terminate for any reason, except as determined by the Committee at the time of
such termination for any reason other than for Cause, all nonvested Shares of
Restricted Stock held by the Participant upon the effective date of employment
termination immediately shall be forfeited and returned to the Company (and
shall once again become available for grant under the Plan). The number of
Shares of Restricted Stock which are deemed vested as of the effective date of
employment termination shall be determined pursuant to the guidelines set forth
with respect to the vesting of Options, as specified in Sections 6.8 and 6.9
herein.
ARTICLE 8. PERFORMANCE UNITS
8.1 Grant of Performance Units. Subject to the terms of the Plan, Performance
Units may be granted to eligible Employees at any time and from time to time, as
shall be determined by the Committee. The Committee shall have complete
discretion in determining the number of Performance Units granted to each
Participant.
8.2 Value of Performance Units. Each Performance Unit shall have an initial
value that is established by the Committee at the time of grant. The Committee
shall set performance goals in its discretion which, depending on the extent to
which they are met, will determine the number and/or value of Performance Units
that will be paid out to the Participants. The time period during which the
performance goals must be met shall, in all cases, exceed six (6) months in
length.
8.3 Earning of Performance Units. After the applicable time period during
which the goals must be met, the holder of Performance Units shall be entitled
to receive payout on the number of Performance Units earned by the Participant
over such period, to be determined as a function of the extent to which the
corresponding performance goals have been achieved.
8.4 Form and Timing of Payment of Performance Units. Payment of earned
Performance Units shall be made in a single lump sum, within forty-five (45)
calendar days following the close of the applicable time period during which the
goals must be met. The Committee, in its sole discretion, may pay earned
Performance Units in the form of cash or in Shares (or in a combination thereof)
which have an aggregate Fair Market Value equal to the value of the earned
Performance Units at the close of such period.
Prior to the beginning of each time period during which the goals must be
met, Participants may elect to defer the receipt of Performance Unit payout upon
such terms as the Committee deems appropriate.
8.5 Termination of Employment Due to Death, Disability, Retirement, or
Involuntary Termination (without Cause). In the event the employment of a
Participant is terminated by reason of death, Disability, Retirement, or
involuntary termination without Cause during a Performance Period, the
Participant shall receive a prorated payout of the Performance Units. The
prorated payout shall be determined by the Committee, in its sole discretion,
based upon the guidelines set forth with respect to the vesting of Options, as
specified in Sections 6.8 and 6.9 herein, and further adjusted based on the
achievement of the preestablished performance goals.
Payment of earned Performance Units shall be made at the same time payments
are made to Participants who did not terminate employment during the applicable
time period during which the goals must be met.
8.6 Termination of Employment for Other Reasons. In the event that a
Participant terminates employment with the Company for any reason other than
those reasons set forth in Section 8.5, all Performance Units shall be forfeited
by the Participant to the Company, and shall once again be available for grant
under the Plan.
8.7 Nontransferability. Performance Units may not be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated, other than by will or
by the laws of descent and distribution. Further a Participant's rights under
the Plan shall be exercisable during the Participant's lifetime only by the
Participant or the Participant's legal representative.
ARTICLE 9. PERFORMANCE-BASED AWARDS
9.1 Purpose. The purpose of this Article 9 is to provide the Committee the
ability to qualify the Restricted Stock Awards under Article 7 and the
Performance Unit Awards under Article 8 as "performance-based compensation"
under Section 162(m) of the Code. If the Committee, in its discretion, decides
to grant a Performance-Based Award to a Covered Employee, the provisions of this
Article 9 shall control over any contrary provision contained in Articles 7 or
8.
9.2 Applicability. This Article 9 shall apply only to those Covered Employees
selected by the Committee to receive Performance-Based Awards. The Committee
may, in its discretion, grant Restricted Stock Awards or Performance Unit Awards
to Covered Employees that do not satisfy the requirements of this Article 9. The
designation of a Covered Employee as a Participant for a Performance Period
shall not in any manner entitle the Participant to receive an Award for the
period. Moreover, designation of a Covered Employee as a Participant for a
particular Performance Period shall not require designation of such Covered
Employee as a Participant in any subsequent Performance Period and designation
of one Covered Employee as a Participant shall not require designation of any
other Covered Employees as a Participant in such period or in any other period.
9.3 Discretion of Committee with Respect to Performance Awards. With regard
to a particular Performance Period, the Committee shall have full discretion to
select the length of such Performance Period, the type of Performance-Based
Awards to be issued, the kind and/or level of the Performance Goal, and whether
the Performance Goal is to apply to the Company, a Subsidiary or any division or
business unit thereof.
9.4 Payment of Performance Awards. Unless otherwise provided in the relevant
Award Agreement, a Participant must be employed by the Company or a Subsidiary
on the last day of the Performance Period to be eligible for a Performance Award
for such Performance Period. Furthermore, a Participant shall be eligible to
receive payment under a Performance-Based Award for a Performance Period only if
the Performance Goals for such period are achieved.
In determining the actual size of an individual Performance-Based Award, the
Committee may reduce or eliminate the amount of the Performance-Based Award
earned for the Performance Period, if in its sole and absolute discretion, such
reduction or elimination is appropriate.
9.5 Maximum Award Payable. Notwithstanding any provision contained in the
Plan to the contrary, the maximum Performance-Based Award payable to any one
Participant under the Plan for a Performance Period is Seventy-five Thousand
(75,000) Shares, or in the event the Performance-Based Award is paid in cash,
such maximum Performance-Based Award shall be determined by multiplying
Seventy-five Thousand (75,000) by the Fair Market Value of one Share as of the
date of grant of the Performance-Based Award.
ARTICLE 10. BENEFICIARY DESIGNATION
Each Participant under the Plan may, from time to time, name any beneficiary
or beneficiaries (who may be named contingently or successively) to whom any
benefit under the Plan is to be paid in case of his or her death before he or
she receives any or all of such benefit. Each such designation shall revoke all
prior designations by the same Participant, shall be in a form prescribed by the
Company, and will be effective only when filed by the Participant in writing
with the Human Resource Department of the Company during the Participant's
lifetime. In the absence of any such designation, benefits remaining unpaid at
the Participant's death shall be paid to the Participant's estate.
ARTICLE 11. DEFERRALS
The Committee may permit a Participant to defer such Participant's receipt of
the payment of cash or the delivery of Shares that would otherwise be due to
such Participant by virtue of the exercise of an Option, the lapse or waiver of
restrictions with respect to Restricted Stock, or the satisfaction of any
requirements or goals with respect to Performance Units. If any such deferral
election is required or permitted, the Committee shall, in its sole discretion,
establish rules and procedures for such payment deferrals.
ARTICLE 12. RIGHTS OF EMPLOYEES
12.1 Employment. Nothing in the Plan shall interfere with or limit in any way
the right of the Company to terminate any Participant's employment at any time,
nor confer upon any Participant any right to continue in the employ of the
Company.
For purposes of the Plan, transfer of employment of a Participant between the
Company and any one of its Subsidiaries (or between Subsidiaries) shall not be
deemed a termination of employment.
12.2 Participation. No Employee shall have the right to be selected to
receive an Award under this Plan, or, having been so selected, to be selected to
receive a future Award.
ARTICLE 13. CHANGE IN CONTROL
Upon the occurrence of a Change in Control, unless otherwise specifically
prohibited by the terms of Article 17 herein:
(a) Any and all Options granted hereunder shall become immediately
exercisable;
(b) Any restriction periods and restrictions imposed on Restricted Shares
shall lapse, and within ten (10) business days after the occurrence of a
Change in Control, the stock certificates representing Shares of Restricted
Stock, without any restrictions or legend thereon, shall be delivered to the
applicable Participants;
(c) The target value attainable under all Performance Units shall be
deemed to have been fully earned for the entire Performance Period as of the
effective date of the Change in Control, except that all Performance Units
which shall have been outstanding less than six (6) months on the effective
date of the Change in Control shall not be deemed to have earned the target
value; and
(d) Subject to Article 14 herein, the Committee shall have the authority
to make any modifications to the Awards as determined by the Committee to be
appropriate before the effective date of the Change in Control.
ARTICLE 14. AMENDMENT, MODIFICATION, AND TERMINATION
14.1 Amendment, Modification, and Termination. With the approval of the
Board, at any time and from time to time, the Committee may terminate, amend, or
modify the Plan. However, without the approval of the stockholders of the
Company (as may be required by the Code, by the insider trading rules of Section
16 of the Exchange Act, by any national securities exchange or system on which
the Shares are then listed or reported, or by a regulatory body having
jurisdiction with respect hereto) no such termination, amendment, or
modification may:
(a) Increase the total amount of Shares which may be issued under this
Plan, except as provided in Section 4.3 herein; or
(b) Change the class of Employees eligible to participate in the Plan; or
(c) Materially increase the cost of the Plan or materially increase the
benefits to Participants; or
(d) Extend the maximum period after the date of grant during which Options
may be exercised.
14.2 Awards Previously Granted. No termination, amendment, or modification of
the Plan shall in any manner adversely affect any Award previously granted under
the Plan, without the written consent of the Participant holding such Award.
ARTICLE 15. WITHHOLDING
15.1 Tax Withholding. The Company shall have the power and the right to
deduct or withhold, or require a Participant to remit to the Company, an amount
sufficient to satisfy Federal, state, and local taxes (including the
Participant's FICA obligation) required by law to be withheld with respect to
any grant, exercise, or payment made under or as a result of this Plan.
15.2 Share Withholding. With respect to withholding required upon the
exercise of Options, upon the lapse of restrictions on Restricted Stock, or upon
any other taxable event, Participants shall satisfy all federal, state and local
tax withholding requirements by having the Company withhold Shares (to the
extent that Shares are issued pursuant to the Award) having a Fair Market Value
on the date the tax is to be determined equal to the maximum marginal total tax
which would be imposed on the transaction.
ARTICLE 16. SUCCESSORS
All obligations of the Company under the Plan, with respect to Awards granted
hereunder, shall be binding on any successor to the Company, whether the
existence of such successor is the result of a direct or indirect purchase,
merger, consolidation, or otherwise, of all or substantially all of the business
and/or assets of the Company.
ARTICLE 17. REQUIREMENTS OF LAW
17.1 Requirements of Law. The granting of Awards and the issuance of Shares
under the Plan shall be subject to all applicable laws, rules, and regulations,
and to such approvals by any governmental agencies or national securities
exchanges as may be required.
Notwithstanding any other provision set forth in the Plan, if required by the
then current Rule 16b-3 of the Exchange Act, any "derivative security or equity
security" offered pursuant to the Plan to any Insider may not be sold or
transferred for at least six (6) months after the date of grant of such Award,
except in the case of the death, disability, or termination of employment of the
Participant. The terms "equity security" and "derivative security" shall have
the meanings ascribed to them in the then current Rule 16b-3 of the Exchange
Act.
17.2 Governing Law. The Plan, and all agreements hereunder, shall be governed
by the laws of the State of Delaware.
APPENDIX C
DEL WEBB CORPORATION
1995 EXECUTIVE MANAGEMENT INCENTIVE PLAN
ARTICLE 1. ESTABLISHMENT, AND PURPOSE, AND DURATION
1.1 Establishment of the Plan. Del Webb Corporation, a Delaware corporation
(the "Company"), hereby establishes an annual incentive plan to be known as the
"Del Webb Corporation 1995 Executive Management Incentive Plan" (the "Plan").
1.2 Purpose of the Plan. The Plan is designed to (i) recognize and reward on
an annual basis select Company executives for their contributions to the overall
success of the Company, and (ii) qualify compensation paid under the Plan as
"performance-based compensation" as that term is defined in Section 162(m) of
the Internal Revenue Code of 1986 (the "Code") and the regulations thereunder.
1.3 Duration of the Plan. Subject to approval by the Company's stockholders,
the Plan will commence as of July 1, 1995. If the Plan is not approved by the
Company's stockholders, the Plan will not be effective and any grants made under
the Plan prior to that date will be void. No award may be made under the Plan
after the date the Plan terminates, but awards made prior to that date may
extend beyond that date.
ARTICLE 2. DEFINITIONS AND CONSTRUCTION
2.1 Definitions. Whenever used in the Plan, the following terms shall have
the meanings set forth below and, when the meaning is intended, the initial
letter of the word is capitalized:
(a) "Award" means the agreement of the Company to pay compensation to a
Participant upon the attainment of specified Performance Goals.
(b) "Award Agreement" means the written agreement evidencing the terms and
conditions of an Award.
(c) "Board" or "Board of Directors" means the Board of Directors of Del
Webb Corporation.
(d) "Code" means the Internal Revenue Code of 1986, as amended from time
to time.
(e) "Committee" means the Human Resources Committee of the Board or the
committee appointed by the Board pursuant to Article 3 to administer the
Plan.
(f) "Company" means Del Webb Corporation, a Delaware corporation, or any
successor thereto.
(g) "Covered Employee" means an Employee who is a "covered employee"
within the meaning of Section 162(m) of the Code.
(h) "Director" means any individual who is a member of the Board of
Directors of the Company.
(i) "Employee" means any full-time, nonunion employee of the Company.
Directors who are not otherwise employed by the Company shall not be
considered Employees under this Plan.
(j) "Participant" means a Covered Employee who is designated by the
Committee to participate in the Plan for a Performance Period pursuant to
Article 4.
(k) "Performance Criteria" means the criteria that the Committee selects
for purposes of establishing the Performance Goal or Performance Goals for a
Participant for a Performance Period. The Performance Criteria that will be
used to establish Performance Goals are limited to the following: pre- or
after-tax net earnings, revenue growth, operating income, operating cash
flow, return on net assets, return on shareholders' equity, return on assets,
return on capital, Share price growth, shareholder returns, gross or net
profit margin, earnings per Share, price per Share, and market share, any of
which may be measured either in absolute terms, or as compared to any
incremental increase, or as compared to results of a peer group. The
Committee shall, within the time prescribed by Section 162(m) of the Code,
define in an objective fashion the manner of calculating the Performance
Criteria it selects to use for such Performance Period for such Participant.
(l) "Performance Goals" means, for a Performance Period, the goals
established in writing by the Committee for the Performance Period based upon
the Performance Criteria. Depending on the Performance Criteria used to
establish such Goal, the Goal may be expressed in terms of overall Company
performance or the performance of an operating unit or community. The
Committee, in its discretion, may, within the time prescribed by Section
162(m) of the Code, adjust or modify the calculation of Performance Goals for
such Performance Period in order to prevent the dilution or enlargement of
the rights of Participants, (i) in the event of, or in anticipation of, any
unusual or extraordinary corporate item, transaction, event, or development;
and (ii) in recognition of, or in anticipation of, any other unusual or
nonrecurring events affecting the Company, or the financial statements of the
Company, or in response to, or in anticipation of, changes in applicable
laws, regulations, accounting principles, or business conditions.
(m) "Performance Period" means the one or more periods of time, which may
be of varying and overlapping durations, as the Committee may select, over
which the attainment of one or more Performance Goals will be measured for
the purpose of determining a Participant's right to, and the payment of,
compensation under the Plan.
(n) "Shares" means the shares of common stock of Del Webb Corporation.
2.2 Severability. In the event that a court of competent jurisdiction
determines that any portion of this Plan is in violation of any statute, common
law, or public policy, then only the portions of this Plan that violate such
statute, common law, or public policy shall be stricken. All portions of this
Plan that do not violate any statute or public policy shall continue in full
force and effect. Further, any court order striking any portion of this Plan
shall modify the stricken terms as narrowly as possible to give as much effect
as possible to the intentions of the parties under this Plan.
ARTICLE 3. ADMINISTRATION
3.1 The Committee. The Plan shall be administered by the Human Resources
Committee of the Board, or by any other Committee appointed by the Board
consisting of not less than two (2) Directors who are not Employees. The members
of the Committee shall be appointed from time to time by, and shall serve at the
discretion of, the Board of Directors.
3.2 Authority of the Committee. The Committee shall have all the authority
that is necessary or helpful to enable it to discharge its responsibilities
under the Plan. Without limiting the generality of the preceding sentence, the
Committee shall have the exclusive right to interpret the Plan, to determine
eligibility for participation in the Plan, to decide all questions concerning
eligibility for and the amount of Awards payable under the Plan, to establish
and administer the Performance Goals and certify whether, and to what extent,
they are attained, to construe any ambiguous provisions of the Plan, to correct
any default, to supply any omission, to reconcile any inconsistency, to issue
administrative guidelines as an aide to the administration of the Plan, to make
regulations for carrying out the Plan, and to decide any and all questions
arising in the administration, interpretation, and application of the Plan.
3.3 Decisions Binding. All determinations and decisions made by the Committee
pursuant to the provisions of the Plan and all related orders or resolutions of
the Board of Directors shall be final, conclusive, and binding on all persons,
including the Company, its stockholders, Employees, Participants, and their
estates and beneficiaries.
3.4 Section 162(m) Compliance. This Plan shall be administered to comply with
Section 162(m) of the Code and, if any provisions of the Plan cause any Award to
not qualify as performance-based compensation under Section 162(m) of the Code,
that provision shall be stricken from this Plan, but the other provisions of
this Plan shall remain in effect. Any action striking any portion of this Plan
shall modify the stricken terms as narrowly as possible to give as much effect
as possible to the intentions of the parties under this Plan. Furthermore, if
any portion of the Plan or any Award Agreement conflicts with Section 162(m) or
the regulations issued thereunder, the provisions of Section 162(m) and such
regulations shall control.
ARTICLE 4. ELIGIBILITY AND PARTICIPATION
4.1 Eligibility. Participation is limited in any fiscal year to Employees who
the Committee concludes will be Covered Employees for such year.
4.2 Actual Participation. From among the Covered Employees eligible to
participate each year, the Committee may select those to receive Awards in any
one or more Performance Periods under the Plan.
ARTICLE 5. FORM OF AWARDS.
Awards shall be paid in cash. The Committee may, in its sole discretion,
subject any Award to such terms, conditions, restrictions, or limitations
(including but not limited to restrictions on transferability, vesting,
termination of employment for cause or otherwise, or change of control) that the
Committee deems to be appropriate, provided that such terms are not inconsistent
with the terms of the Plan or Section 162(m) of the Code. All Awards will be
evidenced by an Award Agreement.
ARTICLE 6. DETERMINATION AND LIMITATION OF AWARDS.
6.1 Determination of Awards. Within the time prescribed by Section 162(m) of
the Code for each Performance Period, the Committee shall, in its sole
discretion, determine and establish:
(a) the Performance Goals applicable to the Performance Period for each
Participant;
(b) the total dollar amount payable to each Participant under the Award
based upon attaining the Performance Goals; and
(c) such other terms and conditions of such Award as the Committee
determines to be appropriate under the circumstances.Such determinations
shall be reflected in the minutes of a Committee meeting, or in a written
action adopted without the necessity of a meeting, and also shall be
documented in the Award Agreement.
6.2 Limitations of Awards. If only one Performance Goal is established for a
Performance Period, the Performance Goal for such Performance Period must be
achieved in order for a Participant to receive payment for an Award for such
Performance Period. If more than one Performance Goal is established for a
Performance Period, one or more of the Performance Goals for such Performance
Period must be achieved in order for a Participant to receive payment for an
Award for such Performance Period, all as set forth in accordance with the terms
of the Award Agreement. Furthermore, the Committee is authorized at any time
during or after a Performance Period to reduce or eliminate (but not to
increase) the amount of an Award payable to any Covered Employee for a
Performance Period for any reason.
6.3 Maximum Awards. Notwithstanding any provision in the Plan to the
contrary, the maximum Award payable to any Covered Employee under the Plan for a
Performance Period shall be $2,000,000.00.
6.4 Employment Continuation. Unless otherwise determined by the Committee,
provided in the Award Agreement, or required by applicable law, no payment
pursuant to this Plan shall be made to a Participant unless the Participant is
employed by the Company on the last day of the Performance Period.
6.5 Deferrals of Payments. In the exercise of its discretion, the Committee
may allow a Participant to elect to defer the receipt of all or any portion of
an Award. Such deferral shall be made pursuant to the terms and conditions set
forth in the Del Webb Corporation Deferred Compensation Plan.
ARTICLE 7. RIGHTS OF EMPLOYEES
7.1 Employment. Nothing in the Plan shall interfere with or limit in any way
the right of the Company to terminate any Participant's employment at any time,
nor confer upon any Participant any right to continue in the employ of the
Company.
7.2 Participation. No Employee shall have the right to be selected to receive
an Award under this Plan, or, having been so selected, to be selected to receive
a future Award.
ARTICLE 8. AMENDMENT, MODIFICATION, AND TERMINATION
The Committee may suspend or terminate the Plan at any time with or without
prior notice. In addition, the Committee may from time to time and with or
without prior notice, amend or modify the Plan in any manner, but may not
without shareholder approval adopt any amendment that would require the vote of
shareholders of the Company pursuant to Section 162(m) of the Code.
ARTICLE 9. WITHHOLDING
The Company shall have the power and the right to deduct or withhold, or
require a Participant to remit to the Company, an amount sufficient to satisfy
Federal, state, and local taxes (including the Participant's FICA obligation)
required by law to be withheld with respect to any grant, exercise, or payment
made under or as a result of this Plan.
ARTICLE 10. SUCCESSORS
All obligations of the Company under the Plan, with respect to Awards granted
hereunder, shall be binding on any successor to the Company, whether the
existence of such successor is the result of a direct or indirect purchase,
merger, consolidation, or otherwise, of all or substantially all of the business
and/or assets of the Company.
ARTICLE 11. REQUIREMENTS OF LAW
11.1 Requirements of Law. The granting of Awards under the Plan shall be
subject to all applicable laws, rules, and regulations, and to such approvals by
any governmental agencies as may be required.
11.2 Governing Law. The Plan, and all agreements hereunder, shall be governed
by the laws of the State of Delaware.
<PAGE>
DEL WEBB CORPORATION
Annual Meeting of Shareholders - November 8, 1995
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Philip J. Dion, Robertson C. Jones and
Donald V. Mickus, jointly and severeally, proxies with full power of
substitution, and hereby authorizes them to represent and to vote, as designated
below, all shares of Common Stock of Del Webb Corporation held of record by the
undersigned on September 11, 1995, at the Annual Meeting of Shareholders to be
held on November 8, 1995, and any adjournments thereof.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSALS 1, 2, 3, 4 AND 5 BELOW
AND ON REVERSE SIDE
1. ELECTON OF FOUR DIRECTORS TO CLASS II OF THE BOARD OF DIRECTORS (Check one
box only):
FOR all nominees listed below WITHHOLD authority to vote for
---- (except as marked to the contrary ---- all nominees listed below
below):
D. Kent Anderson Kenny C. Guinn Michael E. Rossi Sam Yellen
(Instruction: To withhold authority to vote for any individual nominee,
check the "FOR all nominees" box above and write that nominee's name in
the space provided below.)
--------------------------------------------------------------
2. APPROVAL OF THE DEL WEBB CORPORATION 1995 DIRECTOR STOCK PLAN.
FOR AGAINST ABSTAIN
---- ---- ----
3. APPROVAL OF THE DEL WEBB CORPORATION 1995 EXECUTIVE LONG-TERM INCENTIVE
PLAN.
FOR AGAINST ABSTAIN
---- ---- ----
4. APPROVAL OF THE DEL WEBB CORPORATION 1995 EXECUTIVE MANAGEMENT INCENTIVE
PLAN.
FOR AGAINST ABSTAIN
---- ---- ----
(continued on reverse side) PLEASE SIGN AND DATE THE REVERSE SIDE.
5. RATIFICATION OF THE APPOINTMENT OF KPMG PEAT MARWICK LLP AS THE PRINCIPAL
INDEPENDENT PUBLIC ACCOUNTING FIRM OF THE COMPANY FOR THE YEAR ENDING JUNE
30, 1996.
FOR AGAINST ABSTAIN
---- ---- ----
6. In their discretion on such other matters as may properly come before the
meeting or any adjournments thereof.
---------------------------------------------------------------------------
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE
VOTED FOR PROPOSALS 1, 2, 3, 4, AND 5 AND IN THE DISCRETION OF THE PROXIES ON
SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENTS
THEREOF.
P DATED , 1995
---------------------------
R ---------------------------------------------
(Sign Here)
O ---------------------------------------------
(Sign Here, if Held Jointly)
X Please sign EXACTLY as your name appears
hereon. When signing as attorney, executor,
administrator, trustee or guardian, please
Y give full title. If more than one trustee,
all should sign. All joint owners should
sign. If a corporation, sign in full
corporate name by president or other
authorized officer. If in a partnership, sign
in partnership name by authorized person.
PLEASE CHECK IF YOU PLAN TO ATTEND THE SHAREHOLDER MEETING.
----
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
