Exhibit 10.1
Lexmark International, Inc.
2004 - 2006 Long-Term Incentive Plan
Agreement
This 2004-2006 Long-Term Incentive Plan (the "2004-2006 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
February 25, 2004.
This agreement is only a summary of the principal terms governing the 2004-2006
LTIP. The 2004-2006 LTIP is subject to the terms of the Lexmark International,
Inc. Stock Incentive Plan, as amended and restated April 30, 2003 (the "Plan").
In the event of any conflict or inconsistency between the terms of this
2004-2006 LTIP agreement 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
not rely solely on the brief description that follows. All capitalized terms
used but not defined herein shall have the meaning set forth in the Plan.
Overview
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The 2004-2006 LTIP is designed to reward the achievement of specific financial
performance objectives over a three-year period. The Compensation and Pension
Committee of the Board of Directors of the Company (the "Committee") established
the financial performance objectives and financial performance measures set
forth below for the performance period beginning January 1, 2004 and ending
December 31, 2006 (the "Performance Period").
Depending upon the Company's attainment of the financial performance objectives
and certain financial performance measures of the Company's peers, the
Participant may be eligible to receive a payment under the 2004-2006 LTIP, as
set forth below.
Plan Measurements
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For the Performance Period, the Committee has established the following
cumulative financial performance measures based on the Company's strategic plan
for the Performance Period:
[Performance Measures]
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Target Opportunity
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The 2004-2006 LTIP awards are denominated in cash but may be paid in cash, stock
or a combination of cash and Company Class A Common Stock in the Committee's
sole discretion. For the Performance Period, your target award is _____________.
The chart below and the examples in Attachment A illustrate how the 2004-2006
LTIP awards will be calculated.
[Performance Targets]
Termination of Employment
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Except in the event of the death or long-term disability of the Participant, the
Participant must be employed at the end of the Performance Period (December 31,
2006) to receive a payout. If the Participant should die or become long-term
disabled during the Performance Period, the payout, if any is achieved based on
actual financial performance of the Company and its peers over the Performance
Period, will be prorated and paid out after the end of the Performance Period.
Forfeiture of the Award
-----------------------
The Participant acknowledges that this opportunity for a long-term incentive
award has been granted as an incentive to the Participant to remain employed by
the Company or one of its Subsidiaries and to exert his or her best efforts to
enhance the value of the Company and its Subsidiaries over the long-term.
Accordingly, the Participant agrees that if he or she (a) within 12 months of
termination of employment with the Company and its Subsidiaries accepts
employment with a competitor of the Company or one of its Subsidiaries or
otherwise engages in competition with the Company or one of its Subsidiaries, or
(b) within 36 months of termination of employment with the Company and its
Subsidiaries, acts against the interests of the Company or one of its
Subsidiaries, including recruiting or employing, or encouraging or assisting the
Participant's new employer to recruit or employ, any employee of the Company or
one of its Subsidiaries without the Company's prior written consent, or (c)
discloses or otherwise misuses confidential information or material of the
Company or one of its Subsidiaries, each of these constituting a harmful action,
then the Participant shall repay to the Company the amount of the award received
under the terms and conditions of the 2004-2006 LTIP. The Committee shall have
the right not to enforce the provisions of this paragraph with respect to the
Participant.
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Interpretation; Construction
----------------------------
All powers and authority conferred upon the Committee pursuant to any term of
the Plan or the 2004-2006 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 2004-2006 LTIP
shall be final, binding and conclusive. The Committee may consult with legal
counsel, who may be counsel to the Company or any of its Subsidiaries, and shall
not incur any liability for any action taken in good faith in reliance upon the
advice of counsel.
Amendment
---------
The Committee shall have the right to alter or amend the 2004-2006 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 the 2004-2006 LTIP without the Participant's consent.
Subject to the preceding sentence, any alteration or amendment to the 2004-2006
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 the 2004-2006 LTIP as promptly as
practical after the adoption. This 2004-2006 LTIP agreement may also be amended
in writing signed by both an authorized representative of the Company and the
Participant.
No Guarantee of Employment or Future Incentive Awards
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Nothing in the Plan or the 2004-2006 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
--------------
The 2004-2006 LTIP and this 2004-2006 LTIP agreement 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
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any conflict or choice of law rule or principle that may otherwise refer
construction or interpretation of the 2004-2006 LTIP or this 2004-2006 LTIP
agreement to the substantive law of another jurisdiction.
Please sign and date this agreement to acknowledge that you have read the terms
of this agreement and understand that this 2004-2006 LTIP award is subject to
the provisions of the Plan and that you agree to the terms and conditions
contained herein and therein.
BY: [Name]
SIGNATURE:_____________________________________________
DATE:_______________________
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Attachment A - Long-Term Incentive Plan Examples
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[Performance Targets and Examples]
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