Exhibit 10.5
PHARMACIA CORPORATION SHARED SUCCESS STOCK OPTION PLAN
(As Amended April 24, 1997 and June 26, 1997 and September 24, 2001)
1. Purposes
The Pharmacia Corporation Shared Success Stock Option Plan is designed,
- to focus employees on business performance that creates stockholder
value;
- to provide employees with an incentive to enhance stockholder
return; and
- to encourage employees to view the Company from the perspective of
its stockholders.
2. Definitions
a) "Associated Company"' means any corporation (or partnership,
joint venture, or other enterprise), of which the Company owns
or controls, directly or indirectly, 10% or more, but less
than 50%. Of the outstanding shares of stock normally entitled
to vote for the election of directors (or comparable equity
participation and voting power).
b) "Board" means the Board of Directors of the Company.
c) "Change in Control" means
(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 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 definition 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
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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, 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 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
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(4) 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 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).
a) "Code" means the Internal Revenue Code of 1986, as amended.
b) "Committee" means the Compensation Committee of the Board, or its
permitted delegate, consisting of two or more non-employee directors
(as defined under Rule 16b-3 of the Exchange Act) appointed by the
Board who meet the requirements of being outside directors within
the meaning of Section 162(m) of the Code.
c) "Common Stock" means the common stock of the Company.
d) "Company" means Pharmacia Corporation, a Delaware corporation, and
any successors thereto.
e) "Exercise Price" means the price at which a Participant may purchase
a share of Common Stock covered by a Stock Option granted pursuant
to the Shared Success Stock Option Plan.
f) "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 Committee, on the
applicable date, or, if there are no sales of Common Stock on the
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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 reported.
g) "Grant Date" means the date as of which the Committee shall
determine that a Stock Option shall become effective.
d) "Parent" means 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.
h) "Participant" means an employee of the Company, a Subsidiary, or an
Associated Company to whom a Stock Option has been granted pursuant
to the Shared Success Stock Option Plan.
i) "Performance Objective" means performance objectives adopted by the
Committee pursuant to the Shared Success Stock Option Plan for
Participants who have received grants of Stock Options. If the
Committee determines that a change in the business, operations,
corporate structure or capital structure of the Company, or the
manner in which it conducts its business, or other events or
circumstances render the Performance Objectives to be unsuitable,
the Committee may modify such Performance Objectives or the related
minimum acceptable level of achievement, in whole or in part as the
Committee deems appropriate.
e) "Retirement" shall have such meaning as set forth in the terms and
conditions of the applicable grant instrument, as determined by the
Committee in its discretion.
j) "Shared Success Stock Option Plan" means the Pharmacia Corporation
Shared Success Stock Option Plan.
k) "Stock Option" means a right granted under the Shared Success Stock
Option Plan to a Participant to purchase a share of Common Stock at
a fixed price for a fixed period of time. Stock Options are not
intended to be incentive stock options within the meaning of Section
422 of the Code.
l) "Subsidiary" means any corporation (or partnership, joint venture,
or other enterprise) of which the Company owns or controls, directly
or indirectly, 50% or more of the outstanding shares of stock
normally entitled to vote for the election of directors (or
comparable equity participation and voting power).
m) "Termination of Employment' means a Participant's termination of
employment with the Company, a Parent, a Subsidiary, or an
Associated Company such that he or she is no longer an employee of
the Company, a Parent, a Subsidiary, or an Associated Company, for
any reason whatsoever.
n) "Total and Permanent Disability" means a physical or mental
disability which entitles the Participant to receive disability
benefits under a long- term disability plan applicable to such
Participant, whether or not such Participant actually receives such
disability
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benefits, or, in the event that there is no long-term disability
plan applicable to such Participant, as determined by the Committee.
3. Term of Shared Success Stock Option Plan
The Shared Success Stock Option Plan shall be effective on the date on which the
Shared Success Stock Option Plan is adopted by the Board.
4. Administration
The Shared Success Stock Option Plan shall be administered by the Committee
except to the extent the Committee delegates administration pursuant to this
paragraph. The Committee may by resolution delegate authority to one or more
committees consisting of one or more officers (a "Subcommittee") to perform one
or both of the following: (i) to select officers or salaried employees
(including salaried directors) of the Company or a Subsidiary (but not of a
Parent) who are to receive stock options, and (ii) to determine the number of
such stock options to be received by the selected officers or salaried
employees; provided, however, that the Committee shall by resolution set forth
the maximum number of stock options that may be made by any Subcommittee(s). Any
such Subcommittee delegated authority by the Committee may not (x) select an
officer who is a current member of such Subcommittee or a member of the Board to
receive stock options, or (y) grant any stock option to a Reporting Person
(defined as a person subject to the reporting requirements of Section 16(a) of
the Exchange Act) or to a "covered employee" under Section 162(m) of the
Internal Revenue Code of 1986, as amended. Only the Committee shall make all
determinations regarding stock option awards to Reporting Persons and/or
"covered employees". To the extent permitted by law, the Committee may appoint
employees of the Company or its Subsidiaries or other third parties to act as
its agents with respect to administration of the Shared Success Stock Option
Plan, including, but not limited to, administration of the exercise of any stock
option granted under the Shared Success Stock Option Plan.
The Committee shall have full power and authority to administer and interpret
the Shared Success Stock Option Plan and to adopt such rules, regulations,
agreements, guidelines and instruments for the administration of the Shared
Success Stock Option Plan as the Committee deems necessary or advisable. The
Committee's powers include, but are not limited to (subject to the specific
limitations described herein), authority to determine the employees to be
granted Stock Options under the Shared Success Stock Option Plan, to determine
the size and applicable terms and conditions of grants to be made to such
employees, to determine the time when Stock Options will be granted, to
determine whether a resignation was voluntary and whether a Termination of
Employment was for cause, to authorize grants to eligible employees and to grant
to foreign nationals or employees who are employed outside of the United States
of America, subject to Section 12 hereof, such substitutes for the Stock Options
as may be deemed necessary or appropriate.
The Committee's interpretations of the Shared Success Stock Option Plan, and all
actions taken and determinations made by the Committee concerning any matter
arising under or with respect to the Shared Success Stock Option Plan or any
Stock Options granted hereunder, shall be final, binding and conclusive on all
interested parties, including the Company, a Parent, a Subsidiary, or an
Associated Company, stockholders of the Company and all former, present and
future employees
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of the Company, a Parent, a Subsidiary, or an Associated Company. The Committee
may as to all questions of accounting rely conclusively upon any determination
made by the internal accountants of the Company.
5. Common Stock Authorized Under the Plan
The total number of shares of Common Stock for which Stock Options may be
granted under the Shared Success Stock Option Plan shall not exceed 2,700,000,
subject to any adjustment which may be made pursuant to Section 10 hereof. The
shares of Common Stock for which Stock Options may be granted under the Shared
Success Stock Option Plan may be authorized but unissued shares of Common Stock
not reserved for any other purposes or shares of Common Stock held in or
acquired for the treasury of the Company, or both. In the event that any
unexercised Stock Option granted pursuant to the Shared Success Stock Option
Plan lapses or ceases to be exercisable for any reason, the shares of Common
Stock subject to such Stock Option shall again be available for Stock Option
grants pursuant to the Shared Success Stock Option Plan.
6. Eligibility
All employees of the Company, a Subsidiary, or an Associated Company shall be
eligible to participate in the Shared Success Stock Option Plan.
7. Terms and Conditions of Stock Options
Each Stock Option granted pursuant to the Shared Success Stock Option Plan shall
be in writing and shall contain such terms and conditions as the Committee may
determine, subject to the following provisions:
a) Grants of Stock Options. The Committee may grant Stock Options to
eligible employees at such times and to the extent the Committee
deems advisable. Any grant of Stock Options may specify Performance
Objectives that, if achieved, will result in exercisability or early
exercisability of such Stock Options.
b) Exercise Price. The Exercise Price of a Stock Option shall be as
determined by the Committee.
c) Term of Stock Options. Stock Options granted pursuant to the Shared
Success Stock Option Plan shall have a term as determined by the
Committee; provided, however, that in no event shall a Stock Option
have a term longer than ten years from the Grant Date. A grant of
Stock Options may vest in installments, however, Stock Options must
be exercised for full shares of Common Stock. To the extent that
Stock Options are not exercised when they become initially
exercisable, they shall be carried forward and be exercisable until
the expiration of the term of such Stock Options, subject to Section
7(f) hereof.
d) Exercise of Stock Options. To exercise a Stock Option, a Participant
(or a transferee of a Participant) shall give oral or written notice
to the Company, or its agent, specifying the number of shares of
Common Stock with respect to which the Stock Option is being
exercised. Any written notice to the Company, or its agent, shall be
signed and dated by the Participant. From time to time the Committee
may establish procedures relating to
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effecting such exercises as are consistent with current technology
and the Company's system for administering the Shared Success Stock
Option Plan. No fractional shares shall be issued as a result of a
Participant's exercising a Stock Option.
e) Payment of Exercise Price. Each Stock Option grant shall specify the
form of consideration to be paid in satisfaction of the Exercise
Price, which may include (i) cash in the form of United States
currency or foreign currency converted to United States dollars at
the exchange rate in effect on the Exercise Date or cashier's check
or certified check payable to the order of the Company, (ii) shares
of Common Stock of the Company already owned, and in the possession
of, the Participant, or (iii) any combination' of cash or shares of
Common Stock of the Company. In addition, it shall be a condition to
the obligation of the Company to deliver shares of Common Stock upon
exercise of a Stock Option, that the Participant pay such amount as
may be requested for the purpose of satisfying the liability for any
foreign, federal, state or local withholding tax in accordance with
Section 14 hereof.
f) Effect of Termination of Employment on Exercise of Stock Options.
Except as otherwise determined by the Committee at or subsequent to
the grant of a Stock Option, any Stock Options held by a Participant
upon a Participant's Termination of Employment shall remain
exercisable as follows:
(1) If the Participant's Termination of Employment is due to
death or Total and Permanent Disability, the Stock Option (to
the extent exercisable as of the termination date) shall be
exercisable for one (1) year following the date of Termination
of Employment (but in no event beyond the term of the Stock
Option) and shall expire thereafter; and
(2) If the Participant's Termination of Employment is for any
other reason, the Stock Option (to the extent exercisable on
the termination date) shall be exercisable for a period of
ninety (90) days following the date of Termination of
Employment (but in no event beyond the term of the Stock
Option) and shall expire thereafter.
(3) In no event may a Stock Option be exercised for a period
beyond the term of the Stock Option.
g) Change in Control. Upon a Change in Control prior to the Termination
of Employment of a Participant, all Stock Options then held by the
Participant shall become immediately exercisable as of the date of
such Change in Control and be able to be exercised by the
Participant in accordance with their terms.
h) Nontransferability of Stock Options. Except as otherwise provided in
this subsection (h), during a Participant's lifetime, his or her
Stock Options shall not be transferable and shall only be
exercisable by the Participant (or by the guardian or legal
representative of the Participant acting in a fiduciary capacity on
behalf of the Participant under state law and court supervision or
comparable office and supervision under applicable foreign law) and
any purported transfer shall be null and void. No Stock Option shall
be transferable other than by designation, by will, or by the laws
of descent and distribution, and is not subject, in whole or in
part, to attachment, execution, or levy of
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any kind. In addition, no qualified domestic relations order (as
defined by the Code or Title I of the Employee Retirement Income
Security Act of 1974, as amended) purporting to authorize a transfer
of a Stock Option shall be recognized as valid. A Participant may
designate in the event of his or her death a beneficiary or
beneficiaries by filing a written designation in such form and
manner as the Committee shall require and such designated
beneficiary shall be entitled to exercise such Participant's Stock
Option during the term of the Stock Option. Notwithstanding the
foregoing, the Senior Vice President of Human Resources of the
Company, in his or her sole discretion, may allow the transfer, for
no consideration to the Participant, of a Stock Option to a
Participant's "Immediate Family," pursuant to the terms and
conditions approved by the Senior Vice President of Human Resources.
In the event of such permitted transfer, the transferee shall take
such Stock Option subject to the same restrictions, terms and
conditions in such Stock Option prior to the permitted transfer. For
purposes of this subsection, "Immediate Family" shall mean (i) the
Participant's children, grandchildren, spouse or common law spouse,
siblings or parents, as well as (ii) a trust in which these persons
(or the Participant) have more than fifty percent of the beneficial
interest, a foundation in which these persons (or the Participant)
control the management of assets, and any other entity in which
these persons (or the Participant) own more than fifty percent of
the voting interests.
i) No Obligation to Exercise. Stock Option. The granting of a Stock
Option shall impose no obligation upon the Participant (or upon a
transferee of a Participant) to exercise such Stock Option.
j) Modification, Extension and Renewal of Stock Options. Subject to the
terms and conditions within the limitations of, the Shared Success
Stock Option Plan, the Committee may modify, extend or renew
outstanding Stock Options granted under the Shared Success Stock
Option Plan, or accept the surrender of outstanding Stock Options
(up to the extent not theretofore exercised) and authorize the
granting of new Stock Options in substitution therefor (up to the
extent not theretofore exercised). Notwithstanding the foregoing or
anything herein, no modification of a Stock Option shall, without
the consent of the Participant, alter or impair any rights or
obligations under any Stock Option theretofore granted under the
Shared Success Stock Option Plan.
k) Other Terms and Conditions. Stock Option grants may contain such
other provisions, which shall not be inconsistent with any of the
foregoing terms, as the Committee deems advisable.
8. Replacement Stock Options.
The Committee shall have the discretionary authority to include in any stock
option agreement a provision that entitles a Participant who is an employee of
the Company, a Parent, a Subsidiary or an Associated Company and who exercises a
Stock Option, in whole or in part, by using previously owned shares of Common
Stock to be granted a replacement Stock Option exercisable for the number of
shares of Common Stock used to exercise the Stock Option. Any such replacement
Stock Option shall be subject to the availability of sufficient shares of Common
Stock under Section 5, and shall be subject to such other terms and conditions
to be determined by the
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Committee consistent with the Shared Success Stock Option Plan. No Participant
shall have any right to the grant of a replacement Stock Option unless such
right is approved by the Committee and included in the Participant's stock
option agreement.
9. Buy Out of Stock Option Gains
At any time after any Stock Option becomes exercisable, the Committee shall have
the right to elect, in its sole discretion and without the consent of the holder
of any Stock Option, to cancel such Stock Option and to cause the Company to pay
to the Participant the excess of the Fair Market Value of the shares of Common
Stock covered by such Stock Option over the Exercise Price of such Stock Option
at the date the Committee provides written notice (the "Buy Out Notice") of its
intention to exercise such right. Buy outs pursuant to this provision shall be
effected by the Company as promptly as possible after the date of the Buy Out
Notice. Payments of buy out amounts may be made in cash (including foreign
currency), in shares of Common Stock, or partly in cash and partly in Common
Stock, as the Committee deems advisable. To the extent payment is made in shares
of Common Stock, the number of shares shall be determined by dividing the amount
of the payment to be made by the Fair Market Value of a share of Common Stock at
the date of the Buy Out Notice. In no event stall the Company be required to
deliver a fractional share of Common Stock in satisfaction of this buy out
provision. Payments of any such buy out amounts shall be made net of any
applicable foreign, federal (including FICA), state and local withholding taxes.
10. Adjustments of the Common Stock
In the event that at any time after the Effective Date a stock dividend, stock
split, recharacterization, merger, consolidation, or other change in
capitalization, or a sale by the Company of all or part of its assets, or any
separation from the Company, including any spin-off or other distribution to
stockholders other than an ordinary cash dividend, results in (i) the
outstanding shares of Common Stock, or any securities exchanged therefor or
received in their place, being exchanged for a different number or class of
shares of stock or other securities of the Company, or for shares of stock or
other securities of any other corporation; or (ii) new, different or additional
shares or other securities of the Company or of any other corporation being
received by the holders of outstanding shares of Common Stock, then, in the case
of a stock dividend or stock split, equitable adjustments shall be automatically
made to the Shared Success Stock Option Plan and the Stock Options (or such
substitutes for the Stock Options) granted hereunder, including, if necessary,
an adjustment in the number of shares and Exercise Price per share applicable to
Stock Options then outstanding and, in all other cases, appropriate adjustments,
if any, shall be made by the Committee in its discretion. Any such adjustment
shall be conclusive and binding for all purposes of the Shared Success Stock
Option Plan.
Notice of any adjustment pursuant to this Section 10 (the "Adjustment Notice")
shall be given by the Company to each holder of a Stock Option (or such
substitutes for the Stock Option) which shall have been so adjusted and such
adjustment (whether or not such Adjustment Notice is given) shall be effective
and binding for all purposes of the Shared Success Stock Option Plan.
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11. Amendment or Termination of Shared Success Stock Option Plan
The Committee may, at any time, amend, suspend or terminate the Shared Success
Stock Option Plan, in whole or in part, provided that no such action shall
adversely affect any rights or obligations with respect to any grants
theretofore made hereunder. The Committee may amend the terms and conditions of
outstanding Stock Options, provided, however, that (i) no such amendment shall
be adverse to the holders of the Stock Options; (ii) no such amendment shall
extend the period for exercise of a Stock Option; and (iii) the amended terms of
the Stock Option would be permitted under the terms of the Shared Success Stock
Option Plan. Notwithstanding the foregoing, any amendment to increase the total
number of shares of Common Stock for which Stock Options may be granted under
the Shared Success Stock Option Plan shall require the approval of the Board.
12. Foreign Participants
The Committee may grant Stock Options to eligible employees who are foreign
nationals or who are employed by the Company, a Parent, a Subsidiary, or an
Associated Company outside of the United States of America. In order to
facilitate the granting of Stock Options, the Committee may provide for special
terms and conditions (including without limitation granting stock options with a
term longer than ten years if appropriate to assure favorable tax treatment) for
grants to employees who are foreign nationals or who are employed by the
Company, a Parent, a Subsidiary, or an Associated Company outside of the United
States of America, as the Committee may consider necessary or appropriate to
accommodate differences in local law, tax policy or custom in other countries in
which the Company, a Parent, a Subsidiary, or an Associated Company operates or
has employees. The Committee may also provide for such substitutes for the Stock
Options for employees who are foreign nationals or who are employed by the
Company, a Parent, a Subsidiary, or an Associated Company outside of the United
States of America as may be deemed necessary or appropriate by the Committee,
Moreover, the Committee may approve such supplements to, or amendments
restatements or alternative versions of t1ds Shared Success Stock Option Plan as
it may consider necessary or appropriate for such purposes without thereby
affecting the terms of the Shared Success Stock Option Plan as in effect for any
other purpose, and the Secretary or other appropriate officer of the Company may
certify any such documents as having been approved and adopted pursuant to
properly delegated authority; provided, however, that no such supplements,
amendments, restatements or alternative versions shall include any provisions
that are inconsistent with the terms of this Shared Success Stock Option Plan,
as then in effect.
13. Securities Law Requirements
a) Restrictions on Resale. No person who acquires shares of Common
Stock pursuant to the Shared Success Stock Option Plan may, during
any period of time that such person is an affiliate of the Company
within the meaning of the rules and regulations of the Securities
and Exchange Commission under the Securities Act of 1933 (the "1933
Act"), sell such shares of Common Stock, unless such offer and sale
is made (i) pursuant to an effective registration statement under
the 1933 Act, which is current and includes the shares to be sold,
or (ii) pursuant to an appropriate exemption from the registration
requirement of the 1933 Act, such as that set forth in Rule 144
promulgated under the 1933 Act.
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b) Registration, Listing and Qualification of Shares of Common Stock.
Each Stock Option shall be subject to the requirement that if at any
time the Committee shall determine that the registration, listing or
qualification of the shares covered thereby upon any securities
exchange or under any foreign, federal, state or local law, or the
consent or approval of any governmental regulatory body, is
necessary or desirable as a condition of, or in connection with, the
granting of such Stock Option or the purchase of shares hereunder,
no such Stock Option may be exercised unless and until Such
registration, listing, qualification, consent or approval shall have
been effected or obtained free of any condition not acceptable to
the Committee. Any person exercising a Stock Option shall make such
representations and agreements and furnish such information as the
Committee may request to assure compliance with the foregoing or any
other applicable legal requirements.
14. Withholding Taxes
The Company may make such provisions and take such steps as it may deem
necessary or appropriate for the withholding of any taxes which the Company is
required by any law or regulations of any governmental authority, whether
federal, state or local, domestic or foreign, to withhold in connection with any
Stock Option or the exercise thereof, including, but not limited to, the
withholding of cash or shares of Common Stock which would be paid or delivered
pursuant to such exercise until the Participant reimburses the Company for the
amount the Company is required to withhold with respect to such taxes, or
canceling any portion of such award in an amount sufficient to reimburse itself
for the amount it is required to so withhold, or selling any property
contingently credited by the Company for the purpose of paying such award in
order to withhold or reimburse itself for the amount it is required to so
withhold. The Committee may permit a Participant (or other person authorized to
act) to elect to pay a portion or all of any amounts required or permitted to be
withheld to satisfy federal, state, local or foreign tax obligations by
directing the Company to withhold a number of whole shares of Common Stock which
would otherwise be distributed and which have a fair market value sufficient to
cover the amount of such required or permitted withholding taxes.
15. Governing Law
The Shared Success Stock Option Plan and any actions taken thereunder shall,
subject to Section 12, be governed in accordance with the laws of the State of
Delaware, without regard to the application of the conflicts of laws provisions
thereof.
16. Rights as a Stockholder
No Participant shall have any rights as a stockholder with respect to any shares
of Common Stock subject to a Stock Option prior to the date the Participant is
recorded as the holder of such shares of Common Stock on the records of the
Company and certificates for shares of Common Stock are issued to such
Participant.
17. No Right to Stock Options
No employee or other person shall have any claim or right to be granted a Stock
Option under the Shared Success Stock Option Plan. Having received a grant of a
Stock Option under the Shared Success Stock Option Plan shall not give a
Participant or other person any right to receive any other
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grant of Stock Options under the Shared Success Stock Option Plan. A Participant
shall have no rights or interests in any Stock Option except as set forth
herein.
18. No Right to Continued Employment
Nothing contained in this Shared Success Stock Option Plan or any booklet or
document describing or referring to this Shared Success Stock Option Plan shall
be deemed to confer on any employee or Participant the right to continue in the
employ of the Company, a Subsidiary, or an Associated Company or affect the
right of the Company, a Subsidiary, or an Associated Company to terminate the
employment of any such person with or without cause.
19. Plan Unfunded
The Shared Success Stock Option Plan shall be unfunded. Except for reserving a
sufficient number of authorized shares of Common Stock to the extent required by
law to meet the requirements of the Shared Success Stock Option Plan, the
Company shall not be required to establish any special or separate fund or to
make any other segregation of assets to assure the delivery of the Common Stock
upon exercise of any Stock Option granted pursuant to the Shared Success Stock
Option Plan.
20. Exclusion from Pension and Other Benefit Plan Computation
By exercise of a Stock Option, each Participant shall be deemed to have agreed
that such Stock Option is special incentive compensation that will not be taken
into account, in any manner, as salary, compensation or bonus in determining the
amount of any payment under any pension, retirement or other employee benefit
plan of the Company, a Subsidiary, or an Associated Company. In addition, each
beneficiary of a deceased Participant shall be deemed to have agreed that such
Stock Option will not affect the amount of any life insurance coverage, if any,
provided by the Company, a Subsidiary, or an Associated Company on the life of
the Participant which is payable to the beneficiary under any life insurance
plan covering employees of the Company, a Subsidiary, or an Associated Company.
21. Notice
All notices or other communications required or permitted to be given under the
Shared Success Stock Option Plan to the Company shall be in writing (unless
otherwise permitted hereunder) and shall be deemed to have been duly given if
delivered personally or mailed first class, postage pre-paid, as follows: (i) if
to the Company - at its principal business address to the attention of the
Secretary; (ii) if to any Participant - at the last address of the Participant
known to the sender at the time the notice or other communication is sent.
22. Inurement of Rights and Obligations
The rights and obligations under the Shared Success Stock Option Plan and any
related documents shall inure to the benefit of, and shall be binding upon, the
Company, its successors and assigns, and the Participants and their
beneficiaries.
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23. Costs and Expenses of the Shared Success Stock Option Plan
Except as otherwise provided herein, the costs and expenses of administering the
Shared Success Stock Option Plan shall be borne by the Company and shall not be
charged to any Stock Option grant nor to any employee receiving a Stock Option
grant. Costs and expenses associated with the exercise of any Stock Option
granted under the Shared Success Stock Option Plan, including, but not limited
to commissions charged by any agent of the Company, may be charged to the
Participant.
24. No Limitation on Rights of the Company
The grant of any Stock Option shall not in any way affect the right or power of
the Company to make adjustments, reclassification, or changes- in its capital or
business structure or to merge, consolidate, dissolve, liquidate or sell or
transfer all or any part of its business or assets. Further, the Shared Success
Stock Option Plan shall not restrict the authority of the Company, for proper
corporate purposes, to grant or assume stock options, other than -under the
Shared Success Stock Option Plan, to or with respect to any employee or other
person.
25. Compliance with Applicable Law
Notwithstanding anything herein to the contrary, the Company shall not be
obligated to cause to be issued or delivered any certificates for shares of
Common Stock pursuant to the exercise of a Stock Option, unless and until the
Company is advised by its counsel that the issuance and delivery of such
certificates is in compliance with all applicable laws, regulations of
governmental authority and the requirements of any exchange upon which shares of
Common Stock are traded. The Company shall in no event be obligated to register
any securities pursuant to the 1933 Act (as now in effect or as hereafter
amended) or to take any other action in order to cause the issuance and delivery
of such certificates to comply with any such law, regulation or requirement.
26. Fractional Shares
The Company shall not be required to issue any fractional shares of Common Stock
pursuant to the Shared Success Stock Option Plan. The Committee may provide for
the elimination of fractions or for the settlement thereof in cash.
27. Notwithstanding any other provision of the Plan, for purposes of any award
that is outstanding as of the date that the Company spins off the Company's
chemical businesses into a new publicly traded company ("Chemicals") and is held
by a Participant who in connection with such spin-off becomes an employee of
chemicals (or a subsidiary or associated company of Chemicals) rather than an
employee of the Company (or a Subsidiary or Associated Company of the Company),
such change of employment shall not constitute a Termination of Employment. With
respect to any such stock option or stock appreciation right held by any such
Participant, Termination of Employment shall mean such Participant's termination
of employment with Chemicals, a subsidiary of Chemicals, or an associated
company of Chemicals such that such Participant is no longer an employee of
Chemicals, a subsidiary of Chemicals or an associated company of Chemicals, for
any reason whatsoever. For purposes of this Section 27, a subsidiary of
Chemicals means any corporation (or partnership, joint venture, or other
enterprise) of which Chemicals owns or controls, directly or indirectly, 50% or
more of the outstanding shares of stock normally entitled to vote for the
election of directors (or comparable equity participation and voting power) and
an associated
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company of Chemicals means any corporation (or partnership, joint venture, or
other enterprise), of which Chemicals owns or controls, directly or indirectly,
10% or more, but less than 50% of the outstanding shares of stock normally
entitled to vote for the election of directors (or comparable equity
participation and voting power).
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