Exhibit 10.1
[FORM]
XXXXX CORPORATION
PERFORMANCE SHARE UNIT AGREEMENT
This Performance Share Unit Agreement (the "Agreement") is made and
entered into by and between XXXXX CORPORATION, a Delaware corporation (the
"Company"), and ______________________ (the "Employee"). If the Employee
presently is or subsequently becomes employed by a subsidiary of the Company,
the term "Company" shall be deemed to refer collectively to the Company and the
subsidiary or subsidiaries which employ the Employee. This Agreement is entered
into as of the ____ day of ____, ____ (the "Date of Grant").
W I T N E S S E T H:
WHEREAS, the Company has adopted the XXXXX CORPORATION LONG-TERM
INCENTIVE COMPENSATION PLAN (the "Plan") to attract, retain and motivate
employees, directors and consultants; and
WHEREAS, the Long-Term Incentive Compensation Plan Committee (the
"Committee") believes that entering into this Agreement with the Employee is
consistent with the stated purposes for which the Plan was adopted.
NOW, THEREFORE, in consideration of the services rendered by the
Employee, it is agreed by and between the Company and the Employee, as follows:
1. Grant. The Company hereby grants as of the Date of Grant a
Performance Award (as defined in the Plan) of ________ performance share
units (the "Units"), subject to the terms and conditions set forth in this
Agreement. Depending upon the Company's performance, the Employee may earn
from ____percent (____%) to ____ (____%) of the Units, based on the total
shareholder return ("TSR") of the Company's common stock, par value $.01
per share (the "Shares"), as compared to the TSR of a peer group of
companies as provided in Section 2.
2. Nature of Award. The Units represent an award for the "Performance
Period" described in this Section 2. The Performance Period begins on
____and ends on ____. At the end of the Performance Period, the Employee
shall be entitled to a cash payment equal to the value of the Units as
determined under this Section 2 and payable at the time indicated in
Section 4 or Section 3(b), as applicable. At the end of the Performance
Period, the amount paid with respect to the Units will be based upon the
TSR of the Company compared to the TSR of a select group of peer companies
designated by the Committee for performance measurement purposes (the "Peer
Group"), which for this Performance Period shall be
_________________________________________________. TSR includes both
appreciation in share price during the Performance Period and the assumed
reinvestment of any dividends declared into additional Shares at the time
dividends are paid. The Share price for the TSR calculation of the Company
shall be the average Share price for the final thirty- (30-) day trading
period of the Performance Period (the "Share Price"). The amount payable to
the Employee pursuant to the
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Agreement shall be an amount equal to the number of Units (as specified in
Section 1 and after any applicable adjustment under Section 3) multiplied
by a "Performance Percentage" (which will be based upon the Company's TSR
ranking as compared to the ranking of the Peer Group, from which the peer
companies having the highest and lowest TSR shall be removed) multiplied by
the Share Price. The Performance Percentage will be determined in
accordance with the following "Performance Schedule."
PERFORMANCE SCHEDULE
PERFORMANCE PERCENTAGE (%)
TO BE MULTIPLIED BY UNITS
BASED UPON THE COMPANY'S TSR AS COMPARED TO THE PEER GROUP
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THE COMPANY'S TSR AS COMPARED TO PERFORMANCE PERCENTAGE (%) TO BE
THE PEER GROUP TSR - PERCENTILE RANKING MULTIPLIED BY UNITS
____ Percentile or Less ____%
____ - ____ Percentile ____%
____ - ____ Percentile ____%
____ - ____ Percentile ____%
____ - ____ Percentile ____%
____ Percentile and Higher ____%
3. Early Termination. In the event of separation from employment of
the Employee prior to the end of the Performance Period on account of an
event described in this Section 3, the number of Units with respect to
which payment at the end of the Performance Period is based shall be
determined as follows:
(a) (i) In the event that the Employee separates from employment
for any reason other than voluntary separation or Cause, as defined in
Section 3(c)(vii), or (ii) in the event of the Employee's death or
(iii) in the event of the Employee's total and permanent disability as
determined by the Committee in its sole discretion, or (iv) in the
event that the Employee shall retire after attaining normal retirement
age of 62 or after attaining an earlier retirement age approved by the
Committee in its sole discretion, the number of Units that shall be
earned by and paid to the Employee or his beneficiary, in accordance
with and at the time specified in Section 4, shall be determined as
follows: the Employee shall forfeit a percentage of the Units equal to
the percentage that the number of full months following the date of
separation, death, disability or retirement to the end of the
Performance Period bears to ____. The Committee shall determine the
number of Units earned and the amount to be paid to the Employee or
his beneficiary as soon as administratively practicable after the end
of the Performance Period based upon the TSR calculation determined
pursuant to Section 2 for the entire Performance Period. In its sole
discretion, the Committee may make a payment to the Employee assuming
a Performance Percentage of up to ____ percent (____%) of the Units
instead of the pro-rata number of Units as determined pursuant to this
Section 3(a). Unless the Committee determines
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otherwise, the Employee will have no right to any other Units and
those other Units granted under this Agreement will be forfeited. If
the Employee separates from employment prior to the end of the
Performance Period due to voluntary separation or on account of Cause,
all Units hereunder will be forfeited.
(b) In the event of a Special Involuntary Termination, as defined
in Section 3(c)(vi), before the end of the Performance Period, no
Units shall be forfeited, and payment with respect to ____ percent
(____%) of the Units shall be made as soon as administratively
practicable following the Special Involuntary Termination. In the
event of a Special Involuntary Termination, the amount payable with
respect to this Agreement will equal the number of Units granted
pursuant to Section 1, multiplied by the Share Price, and multiplied
by a Performance Percentage of ____ percent (____%); provided,
however, the Share Price shall be calculated using the average Share
price for the thirty- (30-) day trading period preceding the date of
the Special Involuntary Termination. Payment pursuant to this Section
3(b) is in-lieu of payment pursuant to Section 3(a) and if the
Employee receives payment pursuant to this Section 3(b) the Employee
will not be entitled to any payment pursuant to Section 3(a).
(c) Definitions. For purposes of this Section 3,
(i) "Change in Control" shall mean:
A. Any "Person" (as defined in Section 3(c)(ii) below),
other than (1) the Company or any of its subsidiaries, (2) a
trustee or other fiduciary holding securities under an
employee benefit plan of the Company or any of its
"Affiliates" (as defined in Section 3(c)(v) below), (3) an
underwriter temporarily holding securities pursuant to an
offering of such securities, or (4) a corporation owned,
directly or indirectly, by the shareholders of the Company
in substantially the same proportions as their ownership of
stock of the Company, is or becomes the "Beneficial Owner"
(as defined in Section 3(c)(iii) below), directly or
indirectly, of securities of the Company (not including in
the securities beneficially owned by such person any
securities acquired directly from the Company or its
Affiliates) representing more than forty percent (40%) of
the combined voting power of the Company's then outstanding
securities, or more than forty percent (40%) of the then
outstanding common stock of the Company, excluding any
Person who becomes such a Beneficial Owner in connection
with a transaction described in Section 3(c)(i)(C)(I) below.
B. The individuals who as of the Date of Grant
constitute the Board of Directors of the Company and any
"New Director" (as defined in Section 3(c)(iv) below) cease
for any reason to constitute a majority of the Board of
Directors.
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C. There is consummated a merger or consolidation of
the Company or any direct or indirect subsidiary of the
Company with any other corporation, except if:
(I) the merger or consolidation results in
the voting securities of the Company outstanding
immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted
into voting securities of the surviving entity or any
parent thereof) at least sixty percent (60%) of the
combined voting power of the voting securities of the
Company or such surviving entity or any parent thereof
outstanding immediately after such merger or
consolidation; or
(II) the merger or consolidation is effected
to implement a recapitalization of the Company (or
similar transaction) in which no Person is or becomes
the Beneficial Owner, directly, or indirectly, of
securities of the Company (not including in the
securities beneficially owned by such Person any
securities acquired directly from the Company or its
Affiliates other than in connection with the
acquisition by the Company or its Affiliates of a
business) representing more than forty percent (40%) of
the combined voting power of the Company's then
outstanding securities.
D. The shareholders of the Company approve a plan of
complete liquidation or dissolution of the Company or an
agreement for the sale or disposition by the Company of all
or substantially all of the Company's assets, other than a
sale or disposition by the Company of all or substantially
all of the Company's assets to an entity at least sixty
percent (60%) of the combined voting power of the voting
securities of which is owned by the stockholders of the
Company in substantially the same proportions as their
ownership of the Company immediately prior to such sale.
(ii) "Person" shall have the meaning given in
section 3(a)(9) of the Securities Exchange Act of 1934
(the "1934 Act") as modified and used in sections 13(d)
and 14(d) of the 1934 Act.
(iii) "Beneficial Owner" shall have the
meaning provided in Rule 13d-3 under the 0000 Xxx.
(iv) "New Director" shall mean an individual
whose election by the Company's Board of Directors or
nomination for election by the Company's shareholders
was approved by a vote of at least two-thirds
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(2/3) of the directors then still in office who either
were directors at the Date of Grant or whose election
or nomination for election was previously so approved
or recommended. However, "New Director" shall not
include a director whose initial assumption of office
is in connection with an actual or threatened election
contest, including but not limited to a consent
solicitation relating to the election of directors of
the Company.
(v) "Affiliate" shall have the meaning set
forth in Rule 12b-2 promulgated under section 12 of the
1934 Act.
(vi) "Special Involuntary Termination" shall
mean the occurrence of (1) or (2) within sixty (60)
days prior to, or at any time after, a "Change in
Control" (as defined in Section 3(c)(i)), where (1) is
termination of the Employee's employment with the
Company (including subsidiaries of the Company) by the
Company for any reason other than "Cause" (as defined
in Section 3(c)(vii)) and (2) is a resignation by the
Employee from employment with the Company (including
subsidiaries of the Company) within ninety (90) days
after an "Adverse Change" (as defined in Section
3(c)(viii)) by the Company (including subsidiaries of
the Company) in the terms of the Employee's employment.
(vii) "Cause" shall mean:
A. An act or acts of dishonesty on
the part of the Employee constituting a
felony or serious misdemeanor and resulting
or intended to result directly in gain or
personal enrichment at the expense of the
Company;
X. Xxxxx or willful and wanton
negligence in the performance of the
Employee's material and substantial duties of
employment with the Company; or
C. Conviction of a felony involving
moral turpitude.
The existence of Cause shall be determined by the
Committee, in its sole and absolute discretion.
(viii) "Adverse Change" shall mean (A) a
change in the city in which the Employee is required to
work regularly, (B) a substantial increase in travel
requirements of employment, (C) a substantial reduction
in duties of the type previously performed by the
Employee, or (D) a significant reduction in
compensation or benefits (other than bonuses and other
discretionary items of compensation) that does not
apply generally to executives of the Company or its
successor.
4. Payment of Units. The value of the Units earned shall be
converted to a fully equivalent cash value at the end of the
Performance Period (or such earlier time as specified under Section
3(b)) and shall be payable in cash as soon as reasonably
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practicable following the close of the Performance Period (or such
earlier time as specified under Section 3(b)) in the amount determined
in accordance with Section 2, as adjusted by Section 3, if applicable.
Such cash payment will be subject to withholding for taxes and other
applicable payroll adjustments. The Committee's determination of the
amount payable shall be binding upon the Employee and his beneficiary
or estate.
5. Adjustment in Number of Units. Except as provided below,
in the event that the outstanding Shares of the Company are increased,
decreased or exchanged for a different number of kind of shares or
other securities, or if additional, new or different shares or
securities are distributed with respect to the Shares through merger,
consolidation, sale of all or substantially all of the assets of the
Company, reorganization, recapitalization, stock dividend, stock
split, reverse stock split or other distribution with respect to such
Shares, the number of Units subject to this Agreement shall be
adjusted, in the sole discretion of the Committee, to reflect the
change in outstanding Shares, and, to the extent Shares are replaced
or exchanged for different securities, the Committee shall, in its
sole discretion, cause the Units to be valued in accordance with
Sections 2 and 3 of this Agreement, but with respect to such new
securities.
6. Definitions; Copy of Plan. To the extent not specifically
provided herein, all terms used in this Agreement shall have the same
meanings ascribed to them in the Plan. By the execution of this
Agreement, the Employee acknowledges receipt of a copy of the Plan. If
any provision of this Agreement is held to be illegal, invalid or
unenforceable under any applicable law, then such provision will be
deemed to be modified to the minimum extent necessary to render it
legal, valid and enforceable; and if such provision cannot be so
modified, then this Agreement will be construed as if not containing
the provision held to be invalid, and the rights and obligations of
the parties will be construed and enforced accordingly.
7. Administration. This Agreement shall at all times be
subject to the terms and conditions of the Plan. The Committee shall
have sole and complete discretion with respect to all matters reserved
to it by the Plan and decisions of the majority of the Committee with
respect thereto and this Agreement shall be final and binding upon the
Employee and the Company. In the event of any conflict between the
terms and conditions of this Agreement and the Plan, the provisions of
the Plan shall control.
8. No Right to Continued Employment. This Agreement shall
not be construed to confer upon the Employee any right to continue as
an Employee of the Company and shall not limit the right of the
Company, in its sole discretion, to terminate the service of the
Employee at any time.
9. Governing Law. This Agreement shall be interpreted and
administered under the laws of the State of
Texas, without giving
effect to any conflict of laws provisions.
10. Amendments. This Agreement may be amended only by a
written agreement executed by the Company and the Employee. Any such
amendment shall be
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made only upon the mutual consent of the parties, which consent (of
either party) may be withheld for any reason.
11. No Liability for Good Faith Determinations. The Company
and the members of the Committee and the Board shall not be liable for
any act, omission or determination taken or made in good faith with
respect to this Agreement or the Units granted hereunder.
12. No Guarantee of Interests. The Board and the Company do
not guarantee the Shares (as defined in the Plan) from loss or
depreciation.
13. Nontransferability. This Agreement and all rights under
this Agreement shall not be transferable by the Employee during his
life other than by will or pursuant to applicable laws of descent and
distribution. Any rights and privileges of the Employee in connection
herewith shall not be transferred, assigned, pledged or hypothecated
by the Employee or by any other person or persons, in any way, whether
by operation of law, or otherwise, and shall not be subject to
execution, attachment, garnishment or similar process. In the event of
any such occurrence, this Agreement shall automatically be terminated
and shall thereafter be null and void. Notwithstanding the foregoing,
all or some of the Units or rights under this Agreement may be
transferred to a spouse pursuant to a domestic relations order issued
by a court of competent jurisdiction.
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by its officers thereunto duly authorized, and the Employee has set his
hand effective as of the date and year first above written.
XXXXX CORPORATION
By:
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Employee
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