EXHIBIT 10.3
2003-2005 Lexmark International, Inc. Long-Term Incentive Plan
Agreement
The Long-Term Incentive Plan (the "LTIP") agreement between Lexmark
International, Inc., a Delaware corporation (the "Company") and the person
specified on the signature page (the "Participant") is entered into as of
January 1, 2003.
This document is a summary of the principal terms governing the 2003-2005 LTIP.
This LTIP is subject to the terms of the Lexmark International, Inc. Stock
Incentive Plan (the "Plan") as amended and restated April 30, 2003. In the event
of any conflict or inconsistency between the terms of this LTIP and the terms of
the Plan, the terms of the Plan shall control. It is important that the
Participant read and understand the Plan and does not rely solely on the brief
description that follows.
Overview
--------
The 2003-2005 LTIP is designed to reward the achievement of specific financial
objectives over a three-year period. The Compensation and Pension Committee (the
"Committee") of the Board of Directors of the Company established the financial
objectives set out below for the performance period beginning 1/1/2003 and
ending 12/31/2005.
Depending upon the Company's attainment of the financial objectives, the
Participant will be eligible to receive a payment under the LTIP, as set out
below. Failure to reach minimum financial results for all three objectives will
result in no payout under the LTIP.
Plan Measurements
-----------------
For the performance period beginning 1/1/2003 and ending 12/31/2005, the
Committee has established the following aggregate performance measures.
[Performance Measures]
Target Opportunity
------------------
The LTIP awards are denominated in cash but may be paid in either cash, stock or
a combination of cash and stock in the Committee's discretion. For this
Performance Period, your target award is _____________.
1
For any payout to occur, either (a) both [Objective 1] and [Objective 2] or (b)
[Objective 3] minimum objectives must be attained. The chart below and the
examples in Attachment A illustrate how the LTIP awards will be calculated. It
should be noted that the attainment of the [Objective 2] objective serves as a
multiplier applied to the part of the award based on attainment of the
[Objective 1] objective.
[Performance Targets]
Forfeiture of the Award
-----------------------
The Participant acknowledges that the opportunity for a long-term incentive
award has been granted as an incentive to the Participant to remain employed by
the Company and to exert his or her best efforts to enhance the value of the
Company over the long-term. Accordingly, the Participant agrees that if he or
she (a) within 12 months of termination of employment with the Company accepts
employment with a competitor of the Company or otherwise engages in competition
with Company, or (b) within 36 months of termination of employment with Company,
acts against the interests of Company, including recruiting or employing, or
encouraging or assisting the Participant's new employer to recruit or employ,
any employee of the Company without Company's prior written consent, or (c)
discloses or otherwise misuses confidential Company information or material,
each of these constituting a harmful action, then the Participant shall repay to
Company the amount of the award received under the terms and conditions of this
LTIP. The Committee shall have the right not to enforce the provisions of this
paragraph with respect to the Participant.
Termination of Employment
-------------------------
Except in the event of death or long-term disability, the Participant must be
employed at the end of the performance period (12/31/2005) to receive a payout.
If the Participant should die or become disabled during the performance period,
the payout, if any is achieved based on actual financial performance over the
performance period, will be prorated.
Interpretation;Construction
---------------------------
All powers and authority conferred upon the Committee pursuant to any term of
the Plan or the LTIP shall be exercised by the Committee, in its discretion. All
determinations, interpretations or other actions made or taken by the Committee
pursuant to the provisions of the Plan or the LTIP shall be final, binding and
conclusive. The Committee may consult with legal counsel, who may be counsel to
the Company, and shall not incur any liability for any action taken in good
faith in reliance upon the advice of counsel.
2
Amendment
---------
The Committee shall have the right to alter or amend this LTIP, from time to
time, as provided in the Plan in any manner for the purpose of promoting the
objectives of the Plan, provided that no such amendment shall impair the
Participant's rights under this LTIP without the Participant's consent. Subject
to the preceding sentence, any alteration or amendment to this LTIP by the
Committee shall, upon adoption by the Committee, become and be binding and
conclusive. The Company shall give written notice to the Participant of any such
alteration or amendment of this LTIP as promptly as practicable after the
adoption. This LTIP may also be amended in writing signed by both the Company
and the Participant.
No Guarantee of Employment or Future Incentive Awards
-----------------------------------------------------
Nothing in the Plan or this LTIP shall be deemed to:
(a) interfere with or limit in any way the right of the Company or any
Subsidiary to terminate the Participant's employment at any time for any
reason, with or without cause;
(b) confer upon the Participant any right to continue in the employ of the
Company or any Subsidiary; and
(c) provide Participant the right to receive any Incentive Awards under the
Plan in the future or any other benefits the Company may provide to some or
all of its employees.
Applicable Law
--------------
This LTIP shall be governed by and construed in accordance with the laws of the
State of Delaware, regardless of the law that might be applied under principles
of conflict of laws and excluding any conflict or choice of law rule or
principle that may otherwise refer construction or interpretation of this LTIP
to the substantive law of another jurisdiction.
Sign and date the document to acknowledge that you have read the terms of this
document and understand that the Company's Long-term Incentive award is subject
to the provisions of the Lexmark International, Inc. Stock Incentive Plan and
that you agree to the terms and conditions contained herein and therein.
BY:_____________________________________________________
-----------------------------------------------------
SIGNATURE:_____________________________________________
---------------------------------------------
DATE:_______________________
-----------------------
3
Attachment A - Long-Term Incentive Plan Examples
------------------------------------------------
[Performance Targets and Examples]
