Attached files
file | filename |
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EX-10.3 - EX-10.3 - OM GROUP INC | l40834exv10w3.htm |
EX-10.1 - EX-10.1 - OM GROUP INC | l40834exv10w1.htm |
EX-31.1 - EX-31.1 - OM GROUP INC | l40834exv31w1.htm |
EXCEL - IDEA: XBRL DOCUMENT - OM GROUP INC | Financial_Report.xls |
EX-32 - EX-32 - OM GROUP INC | l40834exv32.htm |
EX-31.2 - EX-31.2 - OM GROUP INC | l40834exv31w2.htm |
10-Q - FORM 10-Q - OM GROUP INC | l40834e10vq.htm |
EX-10.2 - EX-10.2 - OM GROUP INC | l40834exv10w2.htm |
Exhibit 10.4
2007
Incentive Compensation Plan, as amended
1. | Purpose |
The purpose of this 2007 Incentive Compensation Plan (the
Plan) is to advance the long-term interests of OM
Group, Inc. (the Corporation) by
(i) motivating key personnel by means of incentive
compensation,
(ii) furthering the identity of interests of participants
with those of the stockholders of the Corporation through the
ownership and performance of the common stock of the
Corporation, and
(iii) permitting the Corporation to attract and retain key
personnel and directors whose judgment is important to the
successful conduct of the business of the Corporation.
Toward this objective, the Committee may grant awards to key
personnel of the Corporation and its subsidiaries and to
non-employee directors of the Corporation, on the terms and
subject to the conditions set forth in this Plan.
2. | Definitions |
2.1 Award means any form of stock option,
stock appreciation right, restricted stock award, phantom stock
or restricted stock unit award, or performance bonus granted
pursuant to the provisions of this Plan.
2.2 Award Agreement means a written
document evidencing an Award granted pursuant to this Plan and
establishing the terms, conditions, restrictions and limitations
applicable to such Award. To the extent an Award Agreement is
inconsistent with the terms of this Plan, this Plan shall govern
the rights of the Participant.
2.3 Board means the Board of Directors of
the Corporation.
2.4 Change in Control means any one or
more of the following:
(i) The Corporation is merged, consolidated or reorganized
into or with another corporation or other legal person, and
immediately after such merger, consolidation or reorganization
less than fifty percent (50%) of the combined voting power of
the then-outstanding securities of such corporation or person
immediately after such transaction are held directly or
indirectly in the aggregate by the holders of voting shares of
the Corporation immediately prior to such transaction;
(ii) The Corporation sells all or substantially all of its
assets to any other corporation or other legal person, and less
than fifty percent (50%) of the combined voting power of the
then-outstanding securities of such corporation or person
immediately after such sale are held directly or indirectly in
the aggregate by the holders of voting shares of the Corporation
immediately prior to such sale;
(iii) Any person or group of persons (as the term
person is used in Section 13(d)(3) or
Section 14(d)(2) of the Exchange Act), becomes the
beneficial owner (as the term beneficial owner is
defined under
Rule 13d-3
or any successor rule or regulation promulgated under the
Exchange Act) of securities (a) representing 50% or more of
the issued and outstanding shares of the Corporation or
(b) possessing the power to elect a majority of the Board
of the Corporation, except that any acquisition directly from
the Corporation, any acquisition by the Corporation, or any
acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Corporation or any Subsidiary
shall not constitute a Change in Control;
(iv) The Corporation files a report or proxy statement with
the Securities and Exchange Commission pursuant to the Exchange
Act disclosing in response to an item of
Form 8-K
or Schedule 14A (or any successor schedule, form or report
or item therein) that a Change in Control of the Corporation has
occurred;
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(v) The stockholders of the Corporation approve the
liquidation or dissolution of the Corporation; or
(vi) If during any period of two consecutive years,
individuals who at the beginning of any such period constitute
the Board cease for any reason to constitute at least a majority
of the Board, provided that each director who is first elected,
or first nominated for election by the Corporations
stockholders, by a vote of at least two-thirds of the directors
of the Corporation (or a committee of the Board) then still in
office who were directors of the Corporation at the beginning of
any such period will be deemed to have been a director of the
Corporation at the beginning of such period.
Notwithstanding anything else in this Plan, a Change in
Control shall not include any change for reasons of
bankruptcy, insolvency, or otherwise for the benefit of the
creditors of the Corporation or, if applicable, a Subsidiary of
the Corporation.
2.5 Change in Control Price means the
higher of (i) the mean of the high and low trading prices
for the Corporations Common Stock on the Stock Exchange on
the date of the Change in Control or (ii) the highest price
per share actually paid for the Common Stock in connection with
the Change in Control of the Corporation.
2.6 Code means the Internal Revenue Code
of 1986, as amended from time to time.
2.7 Committee means the Compensation
Committee of the Board, or such other committee designated by
the Board, authorized to administer the Plan, composed of not
fewer than two directors, each of whom shall be a
Non-Employee Director under
Rule 16b-3
of the Exchange Act or any successor rule or statute and shall
be an outside director for purposes of
Section 162(m) of the Code or any successor rule or statute.
2.8 Common Stock means common stock, par
value $.01, of the Corporation.
2.9 Exchange Act means the Securities
Exchange Act of 1934, as amended.
2.10 Key Employee means an employee of
the Corporation or a Subsidiary who holds a position of
responsibility in a managerial, administrative or professional
capacity and whose performance, as determined by the Committee
in the exercise of its sole and absolute discretion, makes
appropriate the grant of an Award under this Plan.
2.11 Non-Employee Director means any
director of the Corporation who is not an employee of the
Corporation.
2.12 Participant means any individual to
whom an Award has been granted by the Committee under this Plan.
2.13 Stock Exchange means the New York
Stock Exchange or, if the Common Stock is no longer traded on
the New York Stock Exchange, such other market price reporting
system on which the Common Stock is traded or quoted and is
designated by the Committee after it determines that such other
exchange is both reliable and reasonably accessible.
2.14 Subsidiary means a corporation or
other business entity in which the Corporation directly or
indirectly has an ownership interest of fifty percent or more.
3. | Administration |
The Plan shall be administered by the Committee except as
otherwise expressly provided in this Plan. Subject to the
express provisions of this Plan, the Committee shall have the
conclusive authority to construe and interpret this Plan and any
Award Agreement under this Plan and to establish, amend and
rescind policies and procedures for the administration of this
Plan and shall have such additional authority as the Board may
from time to time determine to be necessary or desirable.
In addition, in order to enable employees who are foreign
nationals or employed outside the United States, or both, to
receive Awards under this Plan, the Committee may adopt such
policies and subplans as are necessary or advisable, in the
opinion of the Committee, to effectuate the purposes of the Plan.
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4. | Eligibility |
Any Key Employee or Non-Employee Director is eligible to become
a Participant in this Plan.
5. | Available Shares |
5.1 Aggregate Number of Shares. The
aggregate number of shares of Common Stock of the Corporation as
to which Awards may be made under this Plan (including any
annual stock issuances made to Non-Employee Directors pursuant
to Section 11) shall be 3,000,000, subject to
adjustment as provided in this Plan. Such shares may be made
available from authorized and unissued shares of the Corporation
or from shares that have been reacquired by the Corporation and
held as treasury shares.
Notwithstanding the foregoing, subject to adjustment as provided
in this Plan,
(i) the number of shares subject to Awards made to any one
person in any calendar year shall not exceed 250,000; and
(ii) the total number of shares subject to Awards that are
other than stock option and stock appreciation rights Awards
made under this Plan shall not exceed 1,500,000.
5.2 Shares Covered by
Awards. For purposes of calculating the number of
shares of Common Stock deemed to be granted under this Plan,
each Award, in whatever form, shall be deemed to be a grant of a
number of shares of Common Stock equal to the number of shares
represented by the stock options, stock appreciation rights,
shares of restricted stock, shares of phantom stock or
restricted stock units set forth in the Award, except that:
(i) in the case of any Award as to which the exercise of
one right nullifies the exercisability of another, the number of
shares deemed to have been granted shall be the maximum number
of shares (and/or cash equivalents) that could have been
acquired upon the maximum exercise or settlement of the
Award; and
(ii) in the case of any performance-based restricted stock
Award that provides for payments in excess of 100% of the number
of shares set forth in the Award Agreement, the number of shares
granted shall be deemed to be the maximum number of shares
(and/or the cash equivalent) issuable under the Award at the
highest level of performance.
5.3 Use and Re-grant Availability of
Shares. For purposes of calculating the number of
shares of Common Stock available for Awards under this Plan,
(i) any Award or portion of an Award that has been settled
by the payment of cash shall be deemed to have used the number
of shares covered by the Award; and
(ii) any shares subject to any Award that is forfeited or
otherwise terminated without the issuance of shares or payment
of other consideration shall again be available for issuance
under this Plan.
6. | Participation |
The Committee shall select, from time to time, those Key
Employees and Non-Employee Directors who shall be Participants
in the Plan and shall determine the type or types of Awards to
be made to each Participant. The terms, conditions and
restrictions of each Award shall be set forth in an Award
Agreement in a form approved by the Committee.
7. | Stock Options |
7.1 Grants. Awards may be granted
in the form of stock options. Stock options may be incentive
stock options within the meaning of Section 422 of the Code
or non-statutory stock options (i.e., stock options that are not
incentive stock options), or a combination of both, or any
particular type of tax-advantaged option authorized by the Code
from time to time.
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7.2 Terms and Conditions of
Options. An option shall be exercisable in whole
or in such installments and at such times as may be determined
by the Committee, provided that no stock option shall be
exercisable more than ten years after the date of grant. The
exercise price of a stock option shall be established by the
Committee, but such price shall not be less than the per share
fair market value of the Common Stock, as determined by the
Committee, on the date of the grant of the stock option, subject
to adjustment as provided in Sections 17 and 18.
7.3 Restrictions Relating to Incentive Stock
Options. Stock options issued in the form of
incentive stock options shall, in addition to being subject to
all applicable terms, conditions, restrictions and limitations
established by the Committee, comply with Section 422 of
the Code. Incentive stock options shall be granted only to
full-time employees of the Corporation and its Subsidiaries
within the meaning of Section 424 of the Code. The
aggregate fair market value (determined as of the date the
option is granted) of shares with respect to which incentive
stock options are exercisable for the first time by an
individual during any calendar year (under this Plan or any
other plan of the Corporation or any Subsidiary that provides
for the granting of incentive stock options) may not exceed
$100,000 or such other number as may be applicable under the
Code from time to time. Any incentive stock option that is
granted to any employee who is, at the time the option is
granted, deemed for purposes of Section 422 of the Code or
any successor provision, to own shares of the Corporation
possessing more than ten percent of the total combined voting
power of all classes of shares of the Corporation or of a parent
or subsidiary of the Corporation, shall have an option exercise
price that is at least 110% of the fair market value of the
shares at the date of grant and shall not be exercisable after
the expiration of five years from the date it is granted.
7.4 Additional Terms and
Conditions. The Board may, in the Award Agreement
or otherwise, establish such other terms, conditions,
restrictions or limitations on any stock option Award as it
considers appropriate, provided they are not inconsistent with
this Plan, including provisions relating to:
(i) the vesting of such option;
(ii) payments to be made by the Participant at the time of
exercise of such option relating to any taxes associated with
such exercise;
(iii) any requirement imposed on the Participant to retain
the Common Stock acquired upon exercise of such option; and
(iv) the exercisability of such options upon the cessation
of employment or service as a director.
7.5 Payment. Upon exercise, a
participant may pay the exercise price of a stock option in cash
or shares of Common Stock, or a combination of cash and shares
of Common Stock, or such other consideration as the Committee
may deem appropriate. The Committee shall establish appropriate
methods for accepting Common Stock and may impose such
conditions as it deems appropriate on the use of such Common
Stock to exercise a stock option.
8. | Stock Appreciation Rights |
8.1 Grants. Awards may be granted
in the form of stock appreciation rights (SARs).
SARs shall entitle the recipient to receive a payment equal to
the appreciation in market value of a stated number of shares of
Common Stock from the price stated in the Award Agreement (which
price may not be less than the fair market value of the Common
Stock on the date of grant of the SAR) to the market value of
the Common Stock on the date of exercise or surrender. An SAR
may be granted in tandem with all or a portion of a related
stock option under the Plan (Tandem SARs) or may be
granted separately (Freestanding SARs).
8.2 Terms and Conditions of Tandem
SARs. Subject to the limitations contained in the
preceding paragraph, a Tandem SAR shall be exercisable to the
extent, and only to the extent, that the related stock option is
exercisable. Upon exercise of a Tandem SAR as to some or all of
the shares covered by an Award, the related stock option shall
be cancelled automatically to the extent of the number of SARs
exercised, and such shares shall not be eligible for re-grant
under this Plan.
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8.3 Terms and Conditions of Freestanding
SARs. Freestanding SARs shall be exercisable in
whole or in such installments and at such times as may be
determined by the Committee, provided that no Freestanding SAR
shall be exercisable more than ten years after the date of
grant. The base price of a Freestanding SAR also shall be
determined by the Committee, provided that such price shall not
be less that the fair market value of the Common Stock, as
determined by the Committee, on the date of the grant of the
Freestanding SAR.
8.4 Deemed Exercise. The Committee
may provide that an SAR shall be deemed to be exercised at the
close of business on the scheduled expiration date of such SAR,
if at such time the SAR by its terms is otherwise exercisable
and, if so exercised, would result in a payment to the
Participant.
8.5 Additional Terms and
Conditions. The Committee may, in the Award
Agreement or otherwise, establish such other terms, conditions,
restrictions or limitations on any SAR Award as it considers
appropriate, provided that they are not inconsistent with this
Plan.
9. | Restricted Stock Awards |
9.1 Grants. Awards may be granted
in the form of restricted stock Awards, in such numbers and at
such times as the Committee shall determine.
9.2 Award Restrictions. Restricted
stock Awards shall be subject to such terms, conditions,
restrictions or limitations as the Committee deems appropriate,
provided they are not inconsistent with this Plan, including
restrictions on vesting and transferability, forfeiture
provisions, requirements of continued employment or service as a
director, individual performance or the financial performance of
the Corporation or a segment or identified business of the
Corporation. Notwithstanding the foregoing, the vesting schedule
for restricted stock Awards must at a minimum be (i) for
three years for shares that vest based upon continued employment
or service as a director, and (ii) for one year for shares
that vest based upon the financial performance of the
Corporation or a segment or identified business of the
Corporation in accordance with performance criteria established
by the Committee as described in Section 9.5 of this Plan.
9.3 Rights as Shareholders. During
the period in which any shares of Common Stock are subject to
any of the conditions, restrictions or limitations referenced in
the preceding paragraph, the Committee may, in its discretion,
grant to the Participant to whom such restricted shares have
been awarded all or any of the rights of a stockholder with
respect to such shares, including the right to vote such shares
and to receive dividends paid on shares of Common Stock.
9.4 Evidence of Award. Any
restricted stock Award granted under this Plan may be evidenced
in such manner as the Committee deems appropriate, including
book-entry registration or issuance of a stock certificate or
certificates.
9.5 Performance Criteria. In the
event that restricted stock Awards are granted subject to the
financial performance of the Corporation, such restricted stock
Awards shall be earned upon the satisfaction of such performance
targets related to such performance periods as are established
by the Committee at the time of grant. The Committee may
establish performance targets in terms of any or all of the
following: sales, sales growth, gross margins,
operating profit, operating profit growth, net income, net
income growth, earnings per share, growth in earnings per share,
EBITDA, cash flow per share, total stockholder returns, return
on equity, return on invested capital, return on net assets
employed, common stock price or common stock price appreciation.
Performance targets may utilize various combinations of or
changes in any of the above measures, or may utilize any one or
more of the above measures as relates to an identified business
or segment of the Corporations operations or as relates to
the performance of the Corporation as compared to other
entities. Performance targets applicable to restricted stock
Awards may vary from Award to Award and from Participant to
Participant. When determining whether performance targets have
been attained, the Committee shall have the discretion to make
adjustments to take into account extraordinary or nonrecurring
items or events, or unusual nonrecurring gains or losses
identified in the Corporations financial statements,
provided such adjustments are made in a manner consistent with
Section 162(m) of the Code (to the extent applicable). To
the extent appropriate, restricted stock Awards that are made to
Participants subject to Section 162(m) of
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the Code are intended to qualify under Section 162(m) and
the Committee shall interpret the terms of such Awards in a
manner consistent with that intent.
10. | Phantom Stock and Restricted Stock Units |
10.1 Grants. Awards may be granted
in the form of phantom stock or restricted stock unit Awards.
Such Awards shall entitle the Participant to receive the market
value or the appreciation in value of an equivalent number of
shares of Common Stock on a settlement date determined by the
Committee.
10.2 Additional Terms and
Conditions. The Committee may, in the Award
Agreement or otherwise, establish such other terms, conditions,
restrictions or limitations on any Award of phantom stock or
restricted stock units as it considers appropriate, provided
they are not inconsistent with this Plan, including restrictions
on vesting and transferability, forfeiture provisions,
requirements of continued employment or service as a director,
individual performance or the financial performance of the
Corporation or a segment or identified business of the
Corporation. Notwithstanding the foregoing, the minimum vesting
schedule requirements set forth in Section 9.2 of this Plan
shall apply to any time-based or performance-based phantom stock
or restricted stock unit Awards. The provisions of
Section 9.5 of this Plan shall be applicable to phantom
stock or restricted stock unit Awards that are subject to the
financial performance of the Corporation or a segment or
identified business of the Corporation.
11. | Annual Stock Issuance to Non-Employee Directors |
Each Non-Employee Director may receive all or any portion of his
or her annual compensation as a Non-Employee Director in the
form of Common Stock, as determined annually by the Board. The
Board shall have the absolute discretion to determine the
amount, if any, of Non-Employee Director annual compensation
that shall be paid in the form of Common Stock in any year,
which may vary from year to year. Any shares of Common Stock
that are determined by the Board to be issuable pursuant to this
Section shall be issued to Non-Employee Directors as promptly as
practicable following the measurement date for any
installment(s) of such annual compensation being paid in whole
or in part in Common Stock, as determined by the Board. The
measurement date should be the last business day of the relevant
quarter for which compensation is being paid in Common Stock,
and for purposes of determining the number of shares of Common
Stock to be issued, shares shall be valued at the average of the
high and low sale price of Common Stock on the New York Stock
Exchange on the applicable measurement date for such installment
or installments. No fractional shares of Common Stock shall be
issued, and any fractional shares so calculated shall be paid in
cash. No Award Agreement need be executed with respect to any
stock issuances to Non-Employee Directors pursuant to this
Section.
12. | Annual Incentive Awards |
The Committee is responsible for administering the annual
incentive program of the Corporation, which provides annual
bonus opportunities to certain employees of the Corporation and
its Subsidiaries. The Committee shall select, from time to time,
those employees of the Corporation and its Subsidiaries who
shall participate in the annual incentive program for a
particular year and shall determine the annual bonus opportunity
available for each employee so selected. Annual bonus
opportunities shall be based upon such factors and subject to
such terms and conditions as shall be provided in the annual
incentive program for a particular year, which may include
satisfaction of corporate performance goals, segment or
identified business performance goals and individual objectives.
To the extent that annual bonus opportunities are determined for
any employee to be subject to the financial performance of the
Corporation or a segment or identified business of the
Corporation (a performance bonus), such performance
bonus shall be earned upon the satisfaction of such performance
targets as are established by the Committee in its
administration of the annual incentive program, which
performance targets shall be one or more of the performance
targets set forth in Section 9.5 of this Plan. The
provisions of Section 9.5 of this Plan shall be applicable
to annual bonus opportunities that are subject to the financial
performance of the Corporation or a segment or identified
business of the Corporation, such that performance bonus awards
made to employees subject to Section 162(m) of the Code are
intended to qualify under Section 162(m) to the extent
appropriate. The Committee shall interpret the terms of such
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awards in a manner consistent with that intent to the extent
appropriate. The maximum dollar amount of any performance bonus
payable to an employee in any calendar year is $10,000,000.
13. | Payment of Awards |
Except as otherwise provided in this Plan, Award Agreements may
provide that, at the discretion of the Committee, payment of
Awards may be made in cash, Common Stock, a combination of cash
and Common Stock, or any other form of property as the Committee
shall determine. Further, the terms of Award Agreements may
provide for payment of Awards in the form of a lump sum or
installments, as determined by the Committee. All payments of
Awards shall be made in a manner consistent with the
requirements of Section 409A of the Code.
14. | Dividends and Dividend Equivalents |
If an Award is granted in the form of a restricted stock Award
or a phantom stock or restricted stock unit Award, the Committee
may choose, at the time of the grant of the Award, to include as
part of such Award an entitlement to receive dividends or
dividend equivalents, subject to such terms, conditions,
restrictions or limitations as the Committee may establish.
Dividends and dividend equivalents shall be paid in such form
and manner and at such times as the Committee shall determine.
All dividends or dividend equivalents that are not paid
currently may, at the Committees discretion, accrue
interest or be reinvested into additional shares of Common Stock.
15. | Termination of Employment or Service as Director |
The Committee may adopt administrative policies and procedures
and/or
provide in Award Agreements with respect to the rights under an
Award of a Participant who ceases to be employed by either the
Corporation or a Subsidiary or ceases to be a director of the
Corporation, whether because of death, disability, resignation,
termination or retirement pursuant to an established retirement
plan or policy of the Corporation or of the applicable
Subsidiary. All such administrative policies and procedures
shall comply with the requirements of Section 409A of the
Code.
16. | Assignment and Transfer |
The rights and interests of a Participant under the Plan or an
Award may not be assigned, encumbered or transferred other than,
in the event of the death of a Participant, by will or the laws
of descent and distribution, or other than in accordance with a domestic relations order or comparable order that is issued and is applicable to the Participant.
17. | Adjustments Upon Changes in Capitalization |
In the event of any change in the outstanding shares of Common
Stock by reason of any reorganization, recapitalization, stock
split, stock dividend, combination or exchange of shares,
merger, consolidation or any change in the corporate structure
or shares of the Corporation, the maximum aggregate number and
class of shares as to which Awards may be granted under the Plan
(as well as the limitations upon the number of shares that may
be the subject of Awards to any individual in a calendar year
and the aggregate number of shares subject to Awards other than
stock options and SARs) and the number and class of shares
issuable pursuant to then-outstanding Awards (together with the
exercise price of any outstanding stock option or SAR) shall be
appropriately adjusted by the Committee, whose determination
shall be final.
18. | Extraordinary Distributions and Pro Rata Repurchases |
In the event the Corporation shall at any time when an Award is
outstanding make an Extraordinary Distribution (as defined
below) in respect of Common Stock or effect a Pro Rata
Repurchase of Common Stock (as defined below), the Committee
shall consider the economic impact of the Extraordinary
Distribution or Pro Rata Repurchase on Participants and make
such adjustments as it deems equitable under the circumstances.
The determination of the Committee shall, subject to revision by
the Board, be final and binding upon all Participants.
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As used in this Plan, the term Extraordinary
Distribution means any dividend or other distribution of
(i) cash, where the aggregate amount of such cash dividend
or distribution together with the amount of all cash dividends
and distributions made during the preceding twelve months, when
combined with the aggregate amount of all Pro Rata Repurchases
(for this purpose, including only that portion of the aggregate
purchase price of such Pro Rata Repurchases that is in excess of
the fair market value of the Common Stock repurchased during
such twelve-month period), exceeds ten percent of the aggregate
fair market value of all shares of Common Stock outstanding on
the record date for determining the stockholders entitled to
receive such Extraordinary Distribution, or
(ii) any shares of capital stock of the Corporation (other
than shares of Common Stock), other securities of the
Corporation, evidences of indebtedness of the Corporation or any
other person or any other property (including shares of any
Subsidiary of the Corporation), or any combination of such items.
As used in this Plan, Pro Rata Repurchase means any
purchase of shares of Common Stock by the Corporation or any
Subsidiary pursuant to any tender offer or exchange offer,
whether or not subject to Section 13(e) of the Exchange Act
or any successor provision of law, or pursuant to any other
offer available to substantially all holders of Common Stock,
provided that no purchase of shares of Common Stock made by the
Corporation or any Subsidiary in open market transactions shall
be deemed to be a Pro Rata Repurchase.
19. | Withholding Taxes |
The Corporation or the applicable Subsidiary shall be entitled
to deduct from any payment under this Plan, regardless of the
form of such payment, the amount of all applicable income and
employment taxes required by law to be withheld with respect to
such payment or may require the Participant to pay to it such
taxes prior to and as a condition of the making of such payment.
The Committee may allow a Participant to pay the amount of taxes
required by law to be withheld from an Award by withholding from
any payment of Common Stock due as a result of such Award, or by
permitting the Participant to deliver to the Corporation, shares
of Common Stock having a fair market value, as determined by the
Committee, equal to the amount of such required withholding
taxes.
20. | Noncompetition Provision |
Unless the Award Agreement specifies otherwise, a Participant
shall forfeit all unexercised, unearned or unvested Awards if
(i) in the opinion of the Committee, the Participant,
without the written consent of the Corporation, engages directly
or indirectly in any manner or capacity as principal, agent,
partner, officer, director, employee or otherwise in any
business or activity competitive with the business conducted by
the Corporation or any Subsidiary; or
(ii) the Participant performs any act or engages in any
activity that in the opinion of the Committee is detrimental to
the best interests of the Corporation.
21. | Regulatory Approvals and Listings |
Notwithstanding anything contained in this Plan to the contrary,
the Corporation shall have no obligation to issue or deliver
certificates of Common Stock evidencing restricted stock Awards
or any other Award payable in Common Stock prior to
(i) the obtaining of any approval from any governmental
agency that the Corporation shall, in its sole discretion,
determine to be necessary or advisable,
(ii) the admission of such shares to listing on the Stock
Exchange, and
(iii) the completion of any registration or other
qualification of such shares under any state or federal law or
ruling of any governmental body that the Corporation shall, in
its sole discretion, determine to be necessary or advisable.
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22. | No Right to Continued Employment or Grants |
Participation in this Plan shall not give any Key Employee any
right to remain in the employ of the Corporation or any
Subsidiary. The Corporation or, in the case of employment with a
Subsidiary, the Subsidiary, reserves the right to terminate the
employment of any Key Employee at any time. The adoption of this
Plan shall not be deemed to give any Key Employee or any other
individual any right to be selected as a Participant, to be
granted any Awards under this Plan or if granted an Award in any
year, to receive Awards in any subsequent year.
23. | Amendment |
The Board reserves the right to amend, suspend or terminate this
Plan at any time, subject to any applicable requirements for
stockholder approval imposed by the Stock Exchange or any law or
regulation. The Committee may amend the terms of any outstanding
Award, but no such amendment may impair the rights of any
Participant without his or her consent or amend the terms of any
Award that is intended to qualify as performance-based
compensation under Section 162(m) of the Code so as to
increase the amount otherwise payable under the Award.
24. | Governing Law |
The Plan shall be governed by and construed in accordance with
the laws of the State of Ohio.
25. | Change in Control |
25.1 Stock Options. In the event of
a Change in Control, stock options not otherwise exercisable at
the time of the Change in Control shall become fully exercisable
upon such Change in Control.
25.2 Stock Appreciation Rights. In
the event of a Change in Control, Tandem SARs not otherwise
exercisable at the time of the Change in Control shall become
exercisable to the extent that the related Stock Option is
exercisable. Freestanding SARs not otherwise exercisable at the
time of a Change in Control also shall become fully exercisable
upon such Change in Control. In the event of a Change in Control:
(i) the Corporation shall make payment to Participants with
respect to SARs in cash in an amount equal to the appreciation
in the value of the SAR from the base price specified in the
Award Agreement to the Change in Control Price;
(ii) such cash payments to Participants shall be due and
payable, and shall be paid by the Corporation, immediately upon
the occurrence of such Change in Control; and
(iii) after the payment provided for in (ii) above,
Participants shall have no further rights under SARs outstanding
at the time of such Change in Control.
25.3 Restricted Stock Awards. In
the event of a Change in Control, all restrictions and
conditions (including performance targets, at the target level)
previously established with respect to restricted stock Awards
shall conclusively be deemed to have been satisfied.
Participants shall be entitled to have issued to them the shares
of Common Stock described in the applicable Award Agreements,
free and clear of any restriction or restrictive legend, except
that if upon the advice of counsel to the Corporation, shares of
Common Stock cannot lawfully be issued without restriction, then
the Corporation shall make payment to Participants in cash in an
amount equal to the Change in Control Price of the Common Stock
that otherwise would have been issued. In such event:
(i) such cash payments to Participants shall be due and
payable, and shall be paid by the Corporation, immediately upon
the occurrence of such Change in Control; and
(ii) after the payment provided for in (i) above,
Participants shall have no further rights under restricted stock
Awards outstanding at the time of such Change in Control.
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25.4 Phantom Stock or Restricted Stock
Units. In the event of a Change in Control:
(i) all restrictions and conditions (including any
performance targets, at the target level) previously established
with respect to phantom stock or restricted stock unit Awards
shall conclusively be deemed to have been satisfied and
Participants shall be entitled to receive cash in satisfaction
of their rights under phantom stock or restricted stock unit
Awards in accordance with the amounts otherwise payable by the
Corporation pursuant to the Award Agreement;
(ii) such cash payments to Participants shall be due and
payable, and shall be paid by the Corporation, immediately upon
the occurrence of such Change in Control; and
(iii) after the payment provided for in (ii) above,
Participants shall have no further rights under phantom stock or
restricted stock unit Awards outstanding at the time of such
Change in Control.
25.5 Annual Incentive Awards. To
the extent that the Committee has determined bonus opportunities
for employees under the annual incentive program of the
Corporation based upon the financial performance of the
Corporation or a segment or identified business of the
Corporation, in the event of a Change in Control, all
performance targets shall conclusively be deemed to have been
satisfied at the target level. In addition, all individual
objectives related to bonus opportunities shall conclusively be
deemed to have been satisfied. In the event of a Change in
Control:
(i) employees participating in the annual incentive program
shall be entitled to receive payment of bonuses on the basis
described above, and such bonuses shall be paid by the
Corporation immediately upon the occurrence of such Change in
Control; and
(ii) after the payment provided for in (i) above, such
employees shall have no further rights to bonus payments under
such annual incentive plan.
25.6 Miscellaneous. Upon a Change
in Control, no action shall be taken that would adversely affect
the rights of any Participant or the operation of this Plan with
respect to any Award to which the Participant may have become
entitled under this Plan on or prior to the date of the Change
in Control or to which the Participant may become entitled as a
result of such Change in Control.
26. | No Rights as Stockholder or Interest in Corporation Assets |
No Participant shall have any rights as a stockholder as a
result of participation in this Plan except as provided in this
Plan. To the extent any person acquires a right to receive
payments from the Corporation under this Plan, such rights shall
be no greater than the rights of an unsecured creditor of the
Corporation.
27. | Payment by Subsidiaries |
Settlement of Awards to employees of Subsidiaries shall be made
by and at the expense of such Subsidiary. Except as prohibited
by law, if any portion of an Award is to be settled in shares of
Common Stock, the Corporation shall sell and transfer to the
Subsidiary, and the Subsidiary shall purchase, the number of
shares necessary to settle that portion of the Award.
28. | Term of Plan |
This Plan shall become effective upon adoption of the Plan by
the Board, provided that such effectiveness shall be subject to
the approval of the stockholders of the Corporation. Awards may
be granted under this Plan at any time prior to ten years from
the adoption of the Plan by the Board, at which time the Plan
shall expire but without affecting any Awards then outstanding.
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