EXHIBIT 10.3
TSR SHARE AWARD AGREEMENT
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This TSR SHARE AWARD AGREEMENT (this "Agreement") is entered into as of the date
first written above by and between PPG Industries, Inc. (the "Company") and
______________ (the "Participant").
The Company maintains the PPG Industries, Inc. Long Term Incentive Plan (the
"Key Executive LTIP") and the PPG Industries, Inc. Executive Officers' Long Term
Incentive Plan (the "Executive Officers' LTIP," and, together with the Key
Executive LTIP, the "LTIPs"), each of which is incorporated into and forms a
part of this Agreement, and the Participant has been deemed to be a Covered
Employee or has otherwise been selected by the Officers-Directors Compensation
Committee or its Designee (as applicable, the "Committee") to receive an Award
under the Key Executive LTIP or the Executive Officers' LTIP, as determined in
accordance with paragraph 1.C hereof. Capitalized terms used in this Agreement
shall have the respective meanings given to such terms in the Key Executive LTIP
or the Executive Officers' LTIP, as the context dictates, or elsewhere in this
Agreement.
The Award of TSR Shares shall be confirmed by a separate Grant Notice ("Grant
Notice"), specifying the date of grant of the Award (the "Grant Date"), the
number of TSR Shares granted and the Award Goals applicable to such TSR Shares.
Such Award shall be subject to the terms and conditions of this Agreement and
such Grant Notice shall be deemed incorporated by reference into this Agreement.
NOW, THEREFORE, the Company and the Participant, intending to be legally bound,
agree as follows:
1. Terms and Conditions of the Award.
A. This Agreement sets forth the terms and conditions applicable
to the Award of TSR Shares confirmed in the Grant Notice.
B. The Committee may terminate the Award at any time during the
Award Period if, in its sole discretion, the Committee
determines that the Participant is no longer in a position to
have a substantial opportunity to influence the long-term
growth of the Company.
C. If the Participant is deemed to be a Covered Employee as of
the last day of an Award Period, the Participant's Award for
that Award Period will be made under the Executive Officers'
LTIP; provided, that: (1) Awards under the Executive Officers'
LTIP will only be made if the Committee certifies that the
Award Goals set forth in the Grant Notice have been achieved,
and (2) the Committee reserves the right to exercise negative
discretion in reducing or eliminating any Award that
would otherwise be payable. If the Participant is not deemed
to be a "Covered Employee," the Participant's Award will be
made under the Key Executive LTIP; provided, that the
Committee may, in its sole discretion, adjust the amount of an
Award Goal during an Award Period for any such Participant.
The LTIP that is determined to be applicable to the
Participant under the provision set forth above is referred to
in this agreement as the "applicable LTIP."
D. On each date that the Company pays a dividend on its Common
Stock during the Award Period, the Participant shall be
entitled to a Dividend Equivalent on each TSR Share in the
Participant's TSR Account. Unless prohibited under applicable
law or otherwise determined by the Committee in its
discretion, the value of such Dividend Equivalents shall be
automatically deferred, on behalf of the Participant, into the
PPG Stock Account of the Deferred Compensation Plan.
E. If the Participant's employment with the Company terminates
during the Award Period but after the first anniversary of the
Grant Date because of retirement or Disability (as determined
in accordance with the applicable LTIP) or job elimination,
the Participant shall be entitled to a prorated Award which
shall be determined at the end of the Award Period by
multiplying the Award to which the Participant would otherwise
have been entitled by a fraction, the numerator of which is
the number of months the Participant was employed during the
Award Period and the denominator of which is the total number
of calendar months in the Award Period; provided, however,
that the Committee, in its sole discretion, may determine that
a greater Payment, not to exceed the full amount of the
original Award, shall be made to such Participant in respect
of his or her Award or may determine pursuant to the
provisions of the applicable LTIP to reduce or eliminate any
Payment made or to be made to such Participant in respect of
his or her Award. If the Participant's employment with the
Company terminates during the Award Period but after the first
anniversary of the Grant Date because of the Participant's
death, the Committee, in its sole discretion, shall determine
the timing and amount of the Payment, if any, not to exceed
the full amount of the original Award, that shall be made in
respect of the Participant's Award.
F. If the Participant's employment with the Company terminates
during the Award Period for any reason other than retirement,
Disability, job elimination or death, or for any reason before
the first anniversary of the Grant Date, the Participant's
Award shall be forfeited on the date of such termination;
provided, however, that the Committee, in its sole discretion,
may determine that the Participant will be entitled to a full
or partial Payment with respect to the Award.
G. Promptly following the end of the Award Period, the Committee
shall determine the extent, if any, to which the applicable
Award Goals have been attained and the extent, if any, to
which the Award has been earned by the Participant. The
Committee shall have the negative discretion to reduce or
eliminate any Payment for the Award.
H. The Award shall be subject to the provisions of the applicable
LTIP concerning Change in Control of the Company.
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2. Payment on Account of Awards.
A. Upon attainment of the Award Goals, and subject to this
Agreement and the terms of the applicable LTIP, the
Participant shall, at the end of the Award Period, earn a
Payment determined by reference to the number of shares of
Common Stock constituting the earned Award as determined by
the Committee in accordance with paragraph 1.G. The
Participant shall receive payment in the form of cash and/or
shares of Common Stock as determined by the Committee in its
sole discretion. The amount of any cash to be paid in lieu of
Common Stock shall be determined on the basis of the Fair
Market Value of the Common Stock.
B. Any shares of Common Stock issued to the Participant with
respect to his or her Award shall be subject to such
restrictions as the Committee may deem advisable under the
rules, regulations and other requirements of the Securities
and Exchange Commission, the New York Stock Exchange and any
applicable state or foreign securities laws, and the Committee
may cause a legend or legends to be endorsed on any stock
certificates for such shares making appropriate references to
such legal restrictions.
C. Except as otherwise provided in this Agreement, and except in
the event the Participant is permitted and elects to defer
payment, the payment of cash and shares of Common Stock in
accordance with the provisions of paragraph 2 will be
delivered not later than March 15 of the year following the
end of the Award Period.
3. Continuing Conditions. Notwithstanding any other provisions herein, the
Participant, by execution of this Agreement, agrees and acknowledges
that in return for the Award granted by the Company in this Agreement,
the following continuing conditions shall apply:
A. If at any time within the Award Period or within one (1) year
after the Award Period the Participant engages in any activity
in competition with any activity of the Company or any of its
Subsidiaries, or contrary or harmful to the interests of the
Company or any of its Subsidiaries, including, but not limited
to: (1) conduct related to the Participant's employment for
which either criminal or civil penalties against the
Participant may be sought; (2) violation of Company (or
Subsidiary) Business Conduct Policies; (3) accepting
employment with or serving as a consultant, advisor or in any
other capacity to an employer that is in competition with or
acting against the interests of the Company or any of its
Subsidiaries, including employing or recruiting any present,
former or future employee of the Company or any of its
Subsidiaries; (4) disclosing or misusing any confidential
information or material concerning the Company or any of its
Subsidiaries; or (5) participating in a hostile takeover
attempt, then this Award shall terminate effective the date on
which the Participant enters into such activity, unless
terminated sooner by operation of another term or condition of
this Agreement,
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and any "Award Gain" realized by the Participant shall be paid
by the Participant to the Company. "Award Gain" shall mean the
cash and the closing market price of the Common Stock
delivered to the Participant pursuant to paragraph 2 on the
date of such delivery times the number of shares so delivered.
Any shares of Common Stock deferred by the Participant shall
be considered to have been delivered for the purpose of this
paragraph 3.
B. By accepting this Agreement, the Participant consents to a
deduction from any amounts the Company or any of its
Subsidiaries owes the Participant from time to time (including
amounts owed the Participant as wages or other compensation,
fringe benefits or vacation pay, as well as any other amounts
owed to the Participant by the Company or any of its
Subsidiaries), to the extent of the amounts payable to the
Company by the Participant under paragraph 3.A. above. Whether
or not the Company elects to make any set-off in whole or in
part, if the Company does not recover by means of set-off the
full amount payable by the Participant, calculated as set
forth above, the Participant agrees to pay immediately the
unpaid balance to the Company.
C. The Participant may be released from the Participant's
obligations under paragraphs 3.A and 3.B above only if the
Committee determines, in its sole discretion, that such action
is in the best interest of the Company.
4. Nonassignability. Except as provided in the applicable LTIP with
respect to a "Qualified Domestic Relations Order" ("QDRO") as defined
in Section 414(p) of the Internal Revenue Code, neither the Participant
nor his/her Beneficiary shall have the power to encumber, sell,
alienate, or otherwise dispose of his/her interest under the this
Agreement prior to actual payment to and receipt thereof by such
person; nor shall the Administrator of the applicable LTIP recognize
any assignment in derogation of the foregoing. No interest hereunder of
any person shall be subject to attachment, execution, garnishment or
any other legal, equitable, or other process.
5. Beneficiary Designation. In the event of the Participant's death, any
amount payable under this Agreement shall be paid to the Participant's
Beneficiary as determined in accordance the applicable LTIP.
6. Limited Right to Assets of the Corporation. Any amounts payable under
this Agreement shall be paid from the general funds of the Company and
from shares authorized and available for issuance under the applicable
LTIP, and the Participant and any Beneficiary shall be no more than
unsecured general creditors of the Company with no special or prior
right to any assets of the Company for payment of any obligations
hereunder.
7. Certain Adjustments. In the event of any change in the number of
outstanding shares of Common Stock by reason of any stock dividend,
stock split, reorganization, merger, consolidation, exchange of shares
or similar change, a corresponding change shall be made in the number
of TSR Shares subject to this Agreement unless the Committee
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makes a contrary determination, which it may do in its sole discretion
and which, if done, shall be final and binding.
8. Applicable Law. This Agreement is intended to be governed by ERISA. In
any case where ERISA does not apply, this Agreement shall be governed
by and construed in accordance with the laws of the Commonwealth of
Pennsylvania without reference to any choice of law principles.
9. Severability. If any provision of this Agreement shall be held to be
illegal, invalid or unenforceable, that provision will be enforced to
the maximum extent permissible and the legality, validity and
enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
10. Applicable LTIP Governs. Notwithstanding anything in this Agreement to
the contrary, the terms of this Agreement shall be subject to the terms
of the applicable LTIP, a copy of which may be obtained by the
Participant from the office of the Secretary of the Company.
11. Entire Agreement. This Agreement, including without limitation all
documents incorporated by reference herein, contains all terms and
conditions with respect to the subject matter hereof.
12. Amendment. Subject to the terms of the applicable LTIP, including any
limitations on amendments thereof, this Agreement may be amended by
written agreement of the Participant and the Company without the
consent of any other person.
13. No Right to Further Awards. Neither this Agreement nor the grant of an
Award to the Participant under the LTIPs shall confer upon the
Participant any claim of right to be granted further Awards under the
LTIPs or any other compensation plan or program of the Company.
14. No Rights as Shareholder. The Participant shall have no rights as a
shareholder of the Company, including without limitation voting or
dividend rights, with respect to an Award under the applicable LTIP
unless and until shares of Common Stock are actually issued to the
Participant with respect to such Award.
15. Taxes. The Company shall have the right to deduct, or to require the
Participant or other person receiving a Payment under this Agreement to
pay to the Company any Federal or state taxes required by law to be
withheld or paid.
16. Successors of the Company. The rights and obligations of the Company
under this Agreement shall inure to the benefit of, and shall be
binding upon, the successors and assigns of the Company.
PPG INDUSTRIES, INC.
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By: X. X. Xxxx, Vice President, Human Resources
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