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Exhibit 10.1
THE PHARMACIA & UPJOHN, INC.
LONG-TERM INCENTIVE PLAN
AMENDED AND RESTATED AS OF JUNE 1, 2000
1. PURPOSE.
The purpose of the Pharmacia & Upjohn, Inc., Long-Term Incentive Plan
(the "Plan") is to promote the long-term financial interests of Pharmacia &
Upjohn, Inc. ("P&U") and its parent corporation, Pharmacia Corporation (the
"Company"), including their growth and performance, by encouraging key employees
of P&U and its subsidiaries to acquire an ownership position in the Company,
enhancing the ability of the Company and its subsidiaries to attract and retain
employees of outstanding ability, and providing such employees with an interest
in the Company parallel to that of the Company's stockholders.
2. DEFINITIONS.
Unless otherwise required by the context, the terms used in the Plan
shall have the meanings set forth below:
"Award" shall mean an award determined in accordance with the terms of
the Plan.
"Board" or "Board of Directors" shall mean the Board of Directors of
the Company.
"Change in Control" shall mean:
(1) the acquisition by any individual, entity or group (a
"Person"), including any "person" within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), of beneficial ownership within the meaning of
Rule 13d-3 promulgated under the Exchange Act, of 33% or more of either
(i) the then outstanding shares of Common Stock of the Company (the
"Outstanding Company Common Stock") or (ii) the combined voting power
of the then outstanding
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securities of the Company entitled to vote generally in the election of
directors (the "Outstanding Company Voting Securities"); provided,
however, that the following acquisitions of Outstanding Company Common
Stock or Outstanding Company Voting Securities shall not constitute a
Change in Control: (A) any acquisition by the Company, (B) any
acquisition by an employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company,
or (C) any acquisition by any corporation pursuant to a reorganization,
merger or consolidation involving the Company, if, immediately after
such reorganization, merger or consolidation, each of the conditions
described in clauses (i), (ii) and (iii) of subsection (3) of this
Section shall be satisfied; and provided further that, for purposes of
clause (A), if any Person (other than the Company or any employee
benefit plan (or related trust) sponsored or maintained by the Company
or any corporation controlled by the Company) shall become the
beneficial owner of 33% or more of the Outstanding Company Common Stock
or 33% or more of the Outstanding Company Voting Securities by reason
of any acquisition of Outstanding Company Common Stock or Outstanding
Company Voting Securities by the Company and such Person shall, after
such acquisition by the Company, become the beneficial owner of any
additional shares of the Outstanding Company Common Stock or any
additional Outstanding Voting Securities and such beneficial ownership
is publicly announced, such additional beneficial ownership shall
constitute a Change in Control;
(2) individuals who, as of the date hereof, constitute the Board
(the "Incumbent Board") cease for any reason to constitute at least a
majority of such Board; provided, however, that any individual who
becomes a director of the Company subsequent to the date hereof whose
election, or nomination for election by the Company's stockholders,
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was approved by the vote of at least three-quarters of the directors
then comprising the Incumbent Board (either by a specific vote or by
approval of the proxy statement of the Company in which such person is
named as a nominee for director, without objection to such nomination)
shall be deemed to have been a member of the Incumbent board; and
provided further, that no individual who was initially elected as a
director of the Company as a result of an actual or threatened election
contest, as such terms are used in Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act, or any other actual or threatened
solicitation of proxies or consents by or on behalf of any Person other
than the Board shall be deemed to have been a member of the Incumbent
Board;
(3) approval by the stockholders of the Company of a
reorganization, merger or consolidation involving the Company unless,
in any such case, immediately after such reorganization, merger or
consolidation, (i) more than 50% of the then outstanding shares of
common stock of the corporation resulting from such reorganization,
merger or consolidation and more than 50% of the combined voting power
of the then outstanding securities of such corporation entitled to vote
generally in the election of directors is then beneficially owned,
directly or indirectly, by all or substantially all of the individuals
or entities who were the beneficial owners, respectively, of the
Outstanding Company Common Stock and the Outstanding Company Voting
Securities immediately prior to such reorganization, merger or
consolidation and in substantially the same proportions relative to
each other as their ownership, immediately prior to such
reorganization, merger or consolidation, of the Outstanding Company
Common Stock and the Outstanding Company Voting Securities, as the case
may be, (ii) no Person (other than the Company, any employee benefit
plan (or related trust) sponsored or maintained by the
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Company or the corporation resulting from such reorganization, merger
or consolidation (or any corporation controlled by the Company), or any
Person which beneficially owned, immediately prior to such
reorganization, merger or consolidation, directly or indirectly, 33% or
more of the Outstanding Company Common Stock or the Outstanding Company
Voting Securities, as the case may be) beneficially owns, directly or
indirectly, 33% or more of the then outstanding shares of common stock
of such corporation or 33% or more of the combined voting power of the
then outstanding securities of such corporation entitled to vote
generally in the election of directors and (iii) at least a majority of
the members of the board of directors of the corporation resulting from
such reorganization, merger or consolidation were members of the
Incumbent board at the time of the execution of the initial agreement
or action of the Board providing for such reorganization, merger or
consolidation; or
(4) (i) approval by the stockholders of the Company of a plan of
complete liquidation or dissolution of the Company or (ii) the sale or
other disposition of all or substantially all of the assets of the
Company other than to a corporation with respect to which, immediately
after such sale or other disposition, (A) more than 50% of the then
outstanding shares of common stock thereof and more than 50% of the
combined voting power of the then outstanding securities thereof
entitled to vote generally in the election of directors is then
beneficially owned, directly or indirectly, by all or substantially all
of the individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Stock and the
Outstanding Company Voting Securities immediately prior to such sale or
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other disposition and in substantially the same proportions relative to
each other as their ownership, immediately prior to such sale or other
disposition, of the Outstanding Company Common Stock and the
Outstanding Company Voting Securities, as the case may be, (B) no
Person (other than the Company, any employee benefit plan (or related
trust) sponsored or maintained by the Company or such corporation (or
any corporation controlled by the Company), or any Person which
beneficially owned, immediately prior to such sale or other
disposition, directly or indirectly, 33% or more of the Outstanding
Company Common Stock or the Outstanding Company Voting Securities, as
the case may be) beneficially owns, directly or indirectly, 33% or more
of the then outstanding shares of common stock thereof or 33% or more
of the combined voting power of the then outstanding securities thereof
entitled to vote generally in the election of directors and (C) at
least a majority of the members of the board of directors thereof were
members of the Incumbent board at the time of the execution of the
initial agreement or action of the Board providing for such sale or
other disposition (or were approved directly or indirectly by the
Incumbent Board).
"Committee" shall mean the Compensation Committee of the Board of
Directors.
"Common Stock" shall mean the common stock of the Company.
"Effective Date" shall mean November 1, 1995. The effective date of the
amended and restated Plan is June 1, 2000.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Fair Market Value" shall mean, per share of Common Stock, the average
of the highest and lowest price of the Common Stock on the New York Stock
Exchange (the "NYSE"), or such other national securities exchange as may be
designated by the Board, on the applicable date, or, if there are no sales of
Common Stock on the NYSE on such date, then the average of the highest and
lowest price of the Common Stock on the last previous day on which a sale on the
NYSE is
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reported; provided, that the Committee may determine that the Fair Market Value
price may be based upon the average of the highest and lowest price of the
Common Stock (or depositary receipts evidencing ownership of such Common Stock)
on stock exchanges outside the United States with respect to Awards granted to
Participants who are foreign nationals.
"Participant" shall mean an employee of P&U or its subsidiaries who is
selected by the Committee to participate in the Plan.
3. SHARES SUBJECT TO THE PLAN.
Subject to adjustment as provided in Section 17, the number of shares
of Common Stock which shall be available for the grant of Awards under the Plan
shall not exceed in any calendar year commencing after the Effective Date and
before 2001, one and one-quarter percent (1.25%) of the number of shares of
Common Stock outstanding as of January 1 of such year (including treasury
shares); provided that, with respect to calendar year 1995, the maximum number
of shares of Common Stock available for the grant of Awards under the Plan was
2,000,000 shares. The maximum number of shares set forth in the preceding
sentence shall be increased with respect to any year (including years after
2000) by the number of shares available for grant in any prior years since the
effective date of the Plan which were not subject to Awards granted under the
Plan in such prior years plus any shares of Common Stock subject to any Award
that expires unexercised or that is forfeited, terminated or canceled, in whole
or in part. For the year 2001 and subsequent years, there shall be no increases
in the number of shares available for grants under the Plan pursuant to the
first sentence of this Section 3, but there shall be shares available for grants
as a result of the second sentence of this Section 3. The shares of Common Stock
issued under the Plan may be authorized and unissued shares or treasury shares,
as the Company may from time to time determine.
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Subject to adjustment as provided in Section 17, notwithstanding
anything contained herein to the contrary, in no event shall more than 595,000
shares of Common Stock be granted pursuant to stock options or stock
appreciation rights under the Plan to any Participant in any calendar year and
in no event shall the number of shares of Common Stock available for issuance
pursuant to incentive stock options (within the meaning of Section 422 of the
Code) during the term of the Plan exceed the lesser of (a) the number of shares
generally available for issuance under the Plan and (b) 59,500,000 shares. No
additional incentive stock options will be granted under the Plan on or after
June 1, 2000.
4. ADMINISTRATION.
(a) The Plan shall be administered by the Committee. A majority of the
Committee shall constitute a quorum, and the acts of a majority of a quorum
shall be the acts of the Committee. To the extent permitted by law, the
Committee may appoint employees of the Company or other individuals to act as
its agents with respect to its duties and obligations hereunder.
(b) Subject to the provisions of the Plan, the Committee shall (i)
approve the selection of Participants (after such consultation with and
consideration of the recommendations of management as the Committee considers
desirable), (ii) determine the type of Awards to be made to Participants, (iii)
determine the number of shares of Common Stock or share units subject to Awards,
(iv) determine the terms and conditions, not inconsistent with the terms of the
Plan, of any Award granted hereunder (including, but not limited to, any
restriction and forfeiture conditions on such Award), (v) determine whether, to
what extent and under what circumstances, Awards may be settled in cash, (vi) to
the extent appropriate, establish and certify attainment of performance goals as
required by Section 162(m) of the Internal Revenue Code of 1986, as
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amended (the "Code"), and (vii) have the authority to interpret the Plan, to
establish, amend, and rescind any rules and regulations relating to the Plan
(which shall not be inconsistent with the terms of the Plan), to determine the
terms and provisions of any agreements entered into hereunder, and to make all
other determinations necessary or advisable for the administration of the Plan.
The Committee may correct any defect, supply any omission or reconcile any
inconsistency in the Plan or in any Award in the manner and to the extent it
shall deem desirable to carry it into effect. The determinations of the
Committee in the administration of the Plan, as described herein, shall be
final, conclusive and binding on all persons, including the Company, its
stockholders, employees and Participants granted Awards under the Plan.
(c) No members of the Committee shall be personally liable for any
action, determination, or interpretation made in good faith with respect to the
Plan or any Award and all members of the Committee shall be fully indemnified by
the Company with respect to any such action, determination, or interpretation to
the fullest extent provided by the certificate of incorporation and by-laws of
the Company and applicable state law. The Company shall pay all expenses
incurred in the administration of the Plan.
(d) Notwithstanding anything in this Section 4 or in any other
provision of the Plan to the contrary, the Committee may grant authority to the
chief executive officer of the Company to assume the responsibilities and duties
of the Committee described in clauses (i) through (iv) of Section 4(b) with
respect to Awards to employees of the Company who are not officers, and to
assume the authority of the Committee with respect to such Awards in each of the
sections of the Plan which set forth the authority of the Committee in
determining eligibility for Awards and the terms of Awards.
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5. ELIGIBILITY.
Officers and other key employees of P&U and its subsidiaries who meet
such standards as the Committee may from time to time determine are eligible to
be granted Awards under the Plan; provided that no Awards will be granted under
the Plan on or after June 1, 2000 to persons who are executive officers of the
Company.
For purposes of the Plan, a subsidiary corporation shall be any
corporation which at the time qualifies as a subsidiary under the definition of
"subsidiary corporation" in Section 424(f) of the Code. For purposes of the
Plan, a parent corporation shall be any corporation (other than the Company) in
an unbroken chain of corporations ending with the Company if each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one or more of the other corporations in the chain.
6. AWARDS.
Awards under the Plan may consist of stock options (either incentive
stock options within the meaning of Section 422 of the Code or nonstatutory
stock options), stock appreciation rights, performance shares, restricted stock
grants, deferred Common Stock grants and other stock-based Awards. Awards of
performance shares, restricted stock units and other stock-based Awards may
provide the Participant with dividend equivalents prior to vesting of such
Awards. Awards shall be subject to the terms and conditions of the Plan and
shall be evidenced by an agreement containing such additional terms and
conditions, not inconsistent with the provisions of the Plan, as the Committee
shall deem desirable.
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7. STOCK OPTIONS.
Stock options may be granted under the Plan in such form as the
Committee may from time to time approve pursuant to terms set forth in a stock
option agreement.
(a) Types of Stock Options. Each stock option agreement shall state
whether or not the stock option will be treated as an incentive stock option or
a non-qualified stock option.
(b) Option Price. The purchase price per share of the Common Stock
purchasable under a stock option shall be determined by the Committee, but,
except as determined by the Committee, will be not less than 100% of the Fair
Market Value of the Common Stock on the date of the grant of the stock option.
(c) Option Period. The term of each stock option shall be fixed by the
Committee, but no stock option shall be exercisable after the expiration of ten
(10) years from the date the option is granted.
(d) Exercisability. Stock options shall be exercisable at such time or
times as determined by the Committee at or subsequent to grant. Unless otherwise
determined by the Committee at or subsequent to grant, no stock option shall be
exercisable during the twelve-month period ending on the day before the first
anniversary date of the grant of the option, except upon a Change in Control.
(e) Method of Exercise. Stock options may be exercised, in whole or in
part, by giving written notice of exercise to the Company specifying the number
of shares to be purchased. Such notice shall be accompanied by the payment in
full of the option purchase price. Such payment shall be made through the
following methods or procedures: in cash or by certified or bank check, by
tender of shares of Common Stock owned by the Participant (valued at Fair Market
Value determined as of the day immediately prior to exercise) or, at the
discretion of the
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Committee and upon such terms and conditions as the Committee may approve,
through cashless exercise procedures, with other consideration or through other
procedures, or by a combination of any such procedures. The Committee may
determine that previously owned shares of Common Stock be held for a specified
period of time prior to being used to exercise stock options.
(f) Termination of Employment. Except as otherwise determined by the
Committee at or subsequent to grant, any stock options held by a Participant
upon termination of employment shall remain exercisable as follows:
(i) If the Participant's termination of employment is due to
death or permanent disability (as determined by the Committee), the
stock option (to the extent exercisable as of the date of termination)
shall be exercisable for one (1) year following such termination of
employment (but in no event beyond the term of the option), and shall
thereafter terminate; and
(ii) If the Participant's termination of employment is for any
other reason, the stock option (to the extent exercisable as of the
date of termination) shall be exercisable for a period of ninety (90)
days following such termination of employment (but in no event beyond
the term of the option), and shall thereafter terminate.
In the event the Committee determines that a stock option may be
exercised after the periods provided for in this paragraph (f), such longer
exercise period may not extend beyond the term of the option.
(g) Replacement Stock Option Grants. Unless otherwise determined by the
Committee, in the event an optionee who is an employee of P&U or any of its
subsidiaries exercises a stock option by using previously owned shares of Common
Stock, such optionee shall automatically be
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granted a replacement stock option grant for the number of shares of Common
Stock used to exercise the stock option. The replacement stock option shall have
terms and conditions to be determined by the Committee consistent with this
Section 7.
(h) Effect of Exercise Upon Tandem Stock Appreciation Right. Upon
exercise of a stock option with respect to which a tandem stock appreciation
right (as described in Section 8) has been granted, the number of shares of
Common Stock with respect to which the tandem stock appreciation right shall be
exercisable shall be reduced by the number of shares with respect to which the
stock option has been exercised.
8. STOCK APPRECIATION RIGHTS. Stock appreciation rights may be granted under the
Plan in such form as the Committee may from time to time approve pursuant to
terms set forth in a stock appreciation rights agreement.
(a) Types of Stock Appreciation Rights. Stock appreciation rights may
be granted in tandem with a related stock option (a "tandem stock appreciation
right") or may be granted unrelated to any stock option (a "freestanding stock
appreciation right"). A tandem stock appreciation right may be granted at the
time of the related stock option grant or at any time during the term of such
stock option; provided, however, that tandem stock appreciation rights related
to an incentive stock option may only be granted at the time of the grant of
such stock option and may be exercised only when the Fair Market Value of Common
Stock subject to such incentive stock option exceeds the exercise price of such
stock option.
(b) Purchase Price. The purchase price of a stock appreciation right
shall be determined by the Committee at or subsequent to the time of grant of
the stock appreciation right.
(c) Payment. A stock appreciation right shall entitle the holder
thereof, upon exercise of the stock appreciation right or any portion thereof,
to receive payment of an amount
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determined by multiplying (i) the excess of the Fair Market Value per share of
Common Stock on the date of exercise over the per share purchase price of the
stock appreciation right, by (ii) the number of shares of Common Stock as to
which such stock appreciation right is being exercised. Notwithstanding the
foregoing, the Committee may limit in any manner the amount payable with respect
to a stock appreciation right by including such a limit at the time of grant.
(d) Exercise. Free standing stock appreciation rights shall be
exercisable at such time or times, and under such conditions, as shall be
determined by the Committee in its discretion at or subsequent to the time of
grant and, except as otherwise determined by the Committee at or subsequent to
grant, freestanding stock appreciation rights held by a Participant upon
termination of employment shall be exercisable on the same terms as set forth
for stock options in Section 7(f); provided, however, that no freestanding stock
appreciation right shall be exercisable after the expiration of ten (10) years
from the date the stock appreciation right is granted. A tandem stock
appreciation right shall be exercisable at such time or times and only to the
extent that the related stock option is exercisable.
(e) Method of Exercise. Stock appreciation rights may be exercised, in
whole or in part, by giving written notice to the Company specifying the number
of shares with respect to which the stock appreciation right is being exercised.
If requested by the Committee, the holder of a stock appreciation right shall
deliver the agreement evidencing the stock appreciation right being exercised
and, with respect to a tandem stock appreciation right, the agreement evidencing
the related stock option to the Secretary of the Company who shall endorse
thereon a notation of such exercise and return the agreement to the holder.
(f) Form of Payment. Payment of the amount determined under this
Section 8 shall be made solely in
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shares of Common Stock or, at the sole discretion of the Committee, solely in
cash, or in a combination of cash and shares of Common Stock (based upon the
Fair Market Value of the Common Stock as of the date of exercise of the stock
appreciation right).
(g) Effect of Exercise of Tandem Stock Appreciation Right on Related
Stock Option. Upon exercise of a tandem stock appreciation right, the number of
shares of Common Stock covered by the related stock option shall be reduced by
the number of shares with respect to which the stock appreciation right has been
exercised.
9. PERFORMANCE SHARES.
Performance shares may be granted under the Plan in such form as the
Committee may from time to time approve pursuant to the terms set forth in a
performance share agreement.
(a) Types of Performance Shares. Performance shares may be granted in
the form of actual shares of Common Stock or share units having a value equal to
an identical number of shares of Common Stock.
(b) Performance Conditions and Duration. The performance conditions and
the length of the performance period shall be determined by the Committee, but
in no event may a performance period be less than twelve (12) months, except
upon a Change in Control.
(c) Form of Payment. The Committee shall determine in its sole
discretion whether performance shares granted in the form of share units shall
be paid in cash, Common Stock, or a combination of cash and Common Stock (based
upon Fair Market Value of the Common Stock as of the date of exercise or the end
of the performance period, as the case may be).
(d) Termination of Employment. Except as otherwise determined by the
Committee at or subsequent to grant, a Participant must be employed as of the
end of the relevant performance period to be entitled to receive payment with
respect to a performance share award.
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10. RESTRICTED STOCK.
Shares of restricted stock may be issued either alone or in addition to
stock options, deferred stock or other stock-based Awards granted under the
Plan, as determined by the Committee pursuant to terms set forth in a restricted
stock agreement.
(a) Awards of Restricted Stock. Unless such requirement is waived by
the Committee, the prospective recipient of an Award of shares of restricted
stock shall not be deemed to have any rights with respect to such Award, until
and unless such recipient shall have executed an agreement or other instrument
evidencing the Award and delivered a fully executed copy thereof to the Company,
and otherwise complied with the then applicable terms and conditions.
(b) Stock Certificates. Each Participant granted restricted stock under
the Plan shall be issued a stock certificate in respect of shares of restricted
stock awarded under the Plan. Such certificate shall be registered in the name
of the holder, and shall bear an appropriate legend referring to the terms,
conditions, and restrictions applicable to such Award. The Committee shall
require that the stock certificates evidencing such shares be held in custody by
the Company until the restrictions thereon shall have lapsed, and shall require,
as a condition of any restricted stock Award, that the holder shall have
delivered a stock power, endorsed in blank, relating to the stock covered by
such Award.
(c) Restrictions and Conditions. Subject to the provisions of this
Plan, during a period set by the Committee commencing with the date of such
Award (the "restriction period"), the holder of shares of restricted stock shall
not be permitted to sell, transfer, pledge, or assign such shares of restricted
stock awarded under the Plan. Within these limits, the Committee may provide for
the lapse of such restrictions in installments where deemed appropriate. Unless
otherwise determined by the Committee at or subsequent to grant, the restriction
period shall
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remain in effect during the twelve-month period ending on the day before the
first anniversary date of the grant of the shares of restricted stock, except
upon a Change in Control. Subject to the provisions of the immediately following
sentence, upon termination of employment for any reason during the restriction
period, all shares still subject to restriction shall be forfeited by the
Participant and reacquired by the Company. In the event of a Participant's
retirement, permanent disability, or death, or in cases of special
circumstances, the Committee may, in its sole discretion, when it finds that a
waiver would be in the best interests of the Company, waive in whole or in part
any or all remaining restrictions with respect to such Participant's shares of
restricted stock.
(d) Rights of Holder of Restricted Stock. Except as provided in
paragraph (c) of this Section 10, a Participant shall have, with respect to the
shares of restricted stock, all the rights of a shareholder of the Company,
including the right to vote the restricted stock, and the right to receive any
dividends. The Committee, in its sole discretion, may permit or require the
payment of dividends to be deferred and, if the Committee so determines,
reinvested in additional restricted stock or to be otherwise reinvested or
subject to restrictions.
(e) Restricted Stock Units. Restricted stock may also be granted in the
form of restricted stock units having a value equal to an identical number of
shares of Common Stock. The Committee shall determine in its sole discretion
whether restricted stock granted in the form of units shall be paid in cash,
Common Stock or a combination of cash and Common Stock.
11. DEFERRED AWARDS.
The Committee shall have the discretion to grant Awards of the right to
receive Common Stock that are not to be distributed until after a specified
deferral period. Such Awards may be made either alone or in addition to other
Awards granted under the Plan. If the attainment of
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performance goals are specified, the Committee shall certify attainment of such
performance goals prior to any delivery of deferred Common Stock. Prior to
completion of the deferral period, a participant may elect to further defer
receipt of an Award for a specified period or until a specified event, subject
in each case to the approval of the Committee and under such terms as are
determined by the Committee in its sole discretion. The Committee shall
determine in its sole discretion whether such deferred Awards shall be paid in
cash, Common Stock or a combination of cash and Common Stock.
12. OTHER STOCK-BASED AWARDS.
Other Awards of Common Stock and other Awards that are valued in whole
or in part by reference to, or are otherwise based on Common Stock, including
(without limitation) dividend equivalents and convertible debentures, may be
granted either alone or in addition to other Awards granted under the Plan. Any
Awards under this Section 12 and any Common Stock covered by any such Award may
be forfeited to the extent so provided in the Award agreement, as determined by
the Committee.
13. CHANGE IN CONTROL.
Upon the occurrence of a Change in Control, (i) all stock options shall
become vested and exercisable in full, (ii) all stock appreciation rights which
have not been granted in tandem with stock options shall become vested and
exercisable in full, (iii) the restrictions applicable to all shares of
restricted stock shall lapse, (iv) all restricted stock granted in the form of
share units shall be paid in shares of Common Stock, (v) all performance shares
shall be deemed to be earned in full and shall be paid in shares of Common
Stock, and all performance shares granted in the form of share units shall be
deemed to be earned in full and shall be paid in shares of Common Stock, and
(vi) all deferred Awards shall be paid in shares of Common Stock. The
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Committee may, in its discretion, include such further provisions and
limitations in any agreement documenting such Awards as it may deem equitable
and in the best interest of the Company, and may make payments with respect to
restricted stock units, performance share units and deferred Awards in cash in
an amount equal to the Fair Market Value of the Award as of the Change in
Control.
14. WITHHOLDING.
The company shall have the right to deduct from any payment to be made
pursuant to the Plan the amount of any taxes required by law to be withheld
therefrom, or to require a Participant to pay to the Company in cash such amount
required to be withheld prior to the issuance or delivery of any shares of
Common Stock or the payment of cash under the Plan. The Committee may, in its
discretion, permit a Participant to elect to satisfy such withholding obligation
by (i) delivering previously owned shares of Common Stock or (ii) having the
Company retain shares of Common Stock which would otherwise be delivered upon
exercise or payment of Awards (in an amount not exceeding the minimum applicable
tax withholding amount required to satisfy federal (including FICA), state,
local and foreign tax withholding requirements) or (iii) any combination of a
cash payment or the methods set forth in (i) and (ii) above. For purposes of (i)
and (ii) above, shares of Common Stock shall be valued at Fair Market Value
determined as of the day immediately prior to exercise or payment.
15. NONTRANSFERABILITY.
No Award shall be assignable or transferable by the Participant,
otherwise than by will or the laws of descent and distribution, and stock
options and stock appreciation rights shall be exercisable, during the
Participant's lifetime, only by the Participant.
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16. NO RIGHT TO EMPLOYMENT.
No person shall have any claim or right to be granted an Award, and the
grant of an Award shall not be constructed as giving a Participant the right to
be retained in the employ of the Company, its parent or their subsidiaries.
Further, the Company, its parent and their subsidiaries expressly reserve the
right at any time to terminate the employment of a Participant free from any
liability, or any claim under the Plan, except as provided herein or in any
Award agreement entered into hereunder.
17. ADJUSTMENT OF AND CHANGES IN COMMON STOCK.
In the event of any change in the outstanding shares of Common Stock
(including any increase or decrease in such shares) by reason of any stock
dividend or split, recapitalization, merger, consolidation, spin-off,
combination or exchange of shares or other similar corporate change, or any
distributions to common stockholders other than regular cash dividends, the
Committee may make such substitution or adjustment, if any, as it deems to be
equitable, as to the number or kind of shares of Common Stock or other
securities reserved for issuance pursuant to the Plan, or subject to outstanding
Awards, and to any other terms and conditions of outstanding Awards including
the stock option or stock appreciation right purchase price or performance
criteria.
18. EMPLOYMENT BY SUBSIDIARY AND PARENT COMPANIES.
For purposes of the Plan, a transfer of an employee to the employ of a
subsidiary of the Company (or, if provided in the grant instrument, a parent
corporation) shall not be deemed to be a termination of employment and the
employment by a subsidiary (or, if provided in the grant instrument, a parent
corporation) shall be deemed to be employment by the Company.
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19. FOREIGN EMPLOYEES.
Without amending the Plan, the Committee may grant Awards to employees
of the Company or its subsidiaries who are foreign nationals on such terms and
conditions different from those specified in this Plan (including without
limitation granting stock options with a term longer than ten years if
appropriate to assure favorable tax treatment) as may in the judgment of the
Committee be necessary or desirable to foster and promote achievement of the
purposes of the Plan, and, in furtherance of such purposes, the Committee may
make such modifications, amendments, procedures, subplans and the like as may be
necessary or advisable to comply with provisions of laws in other countries in
which the Company or its subsidiaries operate or have employees; provided,
however, that, except as described above, any such modification, amendment,
procedure, subplan or like arrangement shall not be inconsistent with the terms
of the Plan.
20. AMENDMENT.
The Board of Directors may amend, suspend or terminate the Plan or any
portion thereof at any time, provided that no amendment shall be made that would
adversely affect the rights of a Participant under an Award theretofore granted,
without such Participant's written consent.
21. GENERAL PROVISIONS.
(a) The Committee may require each Participant purchasing or acquiring
shares pursuant to an Award under the Plan to represent to and agree with the
Company in writing that such Participant is acquiring the shares for investment
and without a view to distribution thereof.
(b) All certificates for shares of Common Stock delivered under the
Plan pursuant to any Award shall be subject to such stock-transfer orders and
other restrictions as the Committee may deem advisable under the rules,
regulations, and other requirements of the Securities and
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Exchange Commission, any stock exchange upon which the Common Stock is then
listed, and any applicable Federal, state or foreign securities law, and the
Committee may cause a legend or legends to be put on any such certificates to
make appropriate reference to such restrictions. If the Committee determines
that the issuance of shares of Common Stock hereunder is not in compliance with,
or subject to an exemption from, any applicable Federal, state or foreign
securities laws, such shares shall not be issued until such time as the
Committee determines that the issuance is permissible.
(c) The Plan is intended to constitute an "unfunded" plan for incentive
and deferred compensation. Nothing contained herein shall give any Participant
any rights that are greater than those of a general creditor of the Company. In
its sole discretion, the Committee may authorize the creation of trusts or other
arrangements to meet the obligations created under the Plan to deliver Common
Stock or payments in lieu of or with respect to Awards hereunder, provided,
however, that the existence of such trusts or other arrangements is consistent
with the unfunded status of the Plan.
(d) Except as otherwise provided by the Committee in the applicable
Award agreement, a Participant shall have no rights as a shareholder with
respect to any shares of Common Stock subject to stock options, stock
appreciation rights, performance share awards, restricted stock units, or
deferred awards until a certificate or certificates evidencing shares of Common
Stock shall have been issued to the Participant and, subject to Section 17, no
adjustment shall be made for dividends or distributions or other rights in
respect of any share for which the record date is prior to the date on which the
Participant shall become the holder of record thereof.
(e) United States law shall apply to all grants under the Plan except,
in the case of an Award to a foreign national, to the extent local laws preempt
United States law.
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22. EFFECTIVE DATE; TERM OF PLAN.
The Plan shall be effective as of November 1, 1995. Subject to earlier
termination pursuant to Section 20, the plan shall have a term of ten (10) years
from its Effective Date (November 1, 1995).
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