TERMS AND CONDITIONS
means a cash
award pursuant to the provisions of the Plan, expressed as a percentage of
Participant's Base Salary during a Performance Cycle.
means the sum of
the EBITDA component and the ROCE component.
means the annual
base salary of a Participant at the beginning of a Performance
means the Board
of Directors of the Company, as from time to time constituted.
occurrence of any of the following events: (i)
there shall be
consummated (x) any consolidation or merger of the Company in which the Company
is not the continuing or surviving corporation or pursuant to which shares
the Company's Common Stock would be converted into cash, securities or other
property, other than a merger of the Company in which the holders of the
Company's Common Stock immediately prior to the merger have the same
proportionate ownership of common stock of the surviving corporation immediately
after the transaction or (y) any sale, lease, exchange or other transfer
transaction or a series of related transactions) of all or substantially
assets of the Company; or (ii) the stockholders of the Company approve a
proposal for the liquidation or dissolution of the Company; or (iii) any
'person' (as defined in Section 13(d) or 14(d) of the Securities Exchange
1934, as amended (the "Exchange
shall become the
'beneficial owner' (as defined in Rule 13d-3 under the Exchange Act) directly
indirectly of fifty percent (50%) or more of the Company's outstanding Common
Stock or (iv) during any period of two consecutive years, individuals who
beginning of such period constitute the entire Board of Directors shall cease
for any reason to constitute a majority thereof, unless the election or the
nomination for election by the Company's stockholders, of each new director
approved by a vote of at least two-thirds of the directors then still in
who were directors at the beginning of the period.
Internal Revenue Code of 1986, as amended. Reference to a specific
section of the Code shall include such section, any valid regulation promulgated
thereunder, and any comparable provision of any future legislation amending,
supplementing or superseding such section.
Compensation Committee of the Company's Board.
means such time
at which a Participant becomes physically or mentally incapacitated or disabled
such that the Participant is unable to perform for the Company substantially
same services that the Participant performed prior to incurring such incapacity
before income taxes, depreciation and amortization. Three year
annualized EBITDA growth shall be calculated using the following
^ (1/3)] -
= EBITDA for
the third fiscal year of the Performance Cycle
the fiscal year end directly preceding the Performance Cycle commencement.
means an officer
or key manager employed by the Company.
means net income
including extraordinary items determined in accordance with generally accepted
accounting principles except that may be modified by the committee.
Executive who is eligible to become a Participant in the Plan pursuant to
Section 3 and has not ceased to be a Participant pursuant to Section
to the Executive authorized by the Board or the Committee which sets forth
Participation Level of the Executive in the Plan.
means that level
in which a Participant is eligible. The Participation Levels for each
Performance Cycle shall be determined by the Board or the Committee and shall
described in the Participant Grant.
means a period of
three consecutive years. More than one Performance Cycle may be in
progress at any one time. This Performance Cycle shall begin on
January 1, 2005 and shall end on December 31, 2007. A new Performance
Cycle may, subject to Board or Committee approval, begin on January 1 of
threshold, target and maximum levels of three-year average ROCE and EBITDA
growth components for a particular Performance Cycle. The Performance
Targets for each Performance Cycle shall be determined by the
Committee. The Performance Targets for the first Performance Cycle
are set forth below. Each of the ROCE and EBITDA components are to be
equals Net Income
divided by Total Invested Capital. The three year average ROCE shall
be calculated using the following formula:
means the date of
a Participant's termination of employment with the Company.
long-term debt plus preferred stock plus minority interest plus total common
2. Objectives. This
Plan is intended to provide a long-term cash incentive program for Executives
improved profitability, return on investment and growth of the
economic profit and the balance between growth and efficiency;
retain and motivate senior
intended to qualify as "performance-based compensation" under Code Section
beginning of each Performance Cycle, the Chairman, President and Chief Executive
Officer and the Committee shall approve the Participants and the Participation
Level for each Participant for that Performance Cycle. Participation
in the Plan and Participation Level is on a Performance Cycle basis and in
discretion of the Committee. Thus, an Executive who is selected for
participation in a given Performance Cycle is not guaranteed to be selected
participation in any subsequent Performance Cycle.
of the Plan.
4.1 Administrator. The
Plan shall be administered by the Committee.
decision of a majority of the members of the Committee then in office shall
constitute the final and binding act of the Committee. The Committee
may act with or without a meeting being called or held and shall keep minutes
all meetings held and a record of all actions taken by written
Committee shall have all the powers and discretion necessary or appropriate
supervise the administration of the Plan and to control its operation in
accordance with its terms, including, but not limited to, the following
interpret and determine the meaning and validity of the provisions of the
and to determine any question arising under, or in connection with, the
administration, operation or validity of the Plan or any amendment
establish such rules, regulations, agreements, guidelines and procedures
administration of the Plan;
make Participant Grants, establish Participation Levels, set the Performance
Cycle, establish Performance Targets, and take such other action as necessary
fulfill the terms of the Plan.
determine any and all considerations affecting the eligibility of any Executive
to become a Participant or remain a Participant in the Plan;
establish and revise any accounting method or formula for the Plan, as provided
in Section 1;
determine the manner and form in which any payout is to be made under the
employ such counsel, agents and advisers, and to obtain such legal, clerical
other services, as it may deem necessary or appropriate in carrying out the
provisions of the Plan;
establish, from time to time, rules for the performance of its powers and
and for the administration of the Plan; and
delegate to any one or more of its members or to any other person, severally
jointly, the authority to perform for and on behalf of the Committee one
of the functions of the Committee under the Plan.
actions, interpretations, and decisions of the Committee or the Board shall
conclusive and binding on all persons, and shall be given the maximum possible
deference allowed by law.
5.1 Valuation. At
beginning of each Performance Cycle, the Board or the Committee shall establish
the Performance Targets for the Performance Cycle and the Participation Levels
for each Participant, which shall be communicated to each Participant through
the Participant Grant at the time the Performance Targets are set and any
time during the Performance Cycle, as needed.
beginning of each Performance Cycle, the Committee shall (i) assign each
Participant a Participation Level, which will determine the Participant's
potential Award. The threshold amount shall be set at 25% of the
target amount. The maximum Award payable with respect to any
Performance Cycle shall be 200% of the target amount
beginning of each Performance Cycle, the Committee shall determine the
Performance Targets for such Performance Cycle. Awards shall be
payable only if a threshold, target or maximum Performance Target objectives
and Payout of Awards.
Award Measures. At
end of each Performance Cycle, the Committee, or its designee, shall calculate
the three-year average annualized EBITDA growth and the three-year average
using the formulas set forth in this Plan.
Award payout shall be determined as follows:
whether the threshold, target or maximum Performance Target is met for the
EBITDA Component and the ROCE component.
In the case of
the EBITDA component divide the actual EBITDA growth percentage achieved
applicable Performance Target for the EBITDA component and multiple the result
by 50% (the "EBITDA
the case of the ROCE component, divide the actual ROCE percentage achieved
the applicable ROCE Performance Level for the ROCE component and multiple
result by 50% (the "ROCE
Add the EBITDA
Award Measure and the ROCE Award Measure and multiply the resulting sum by
applicable Participation Level (threshold, target or maximum).
result of the calculation in (c) by the Base Salary of the Participant at
start of the cycle.
calculation will be distributed to each Participant. No Awards shall
be paid to a Participant for a Performance Cycle unless the threshold for
the EBTIDA component or the ROCE component is achieved.
shall be paid in cash following the conclusion of each Performance Cycle
as reasonably practicable following completion of the audit of the Company's
financial statements for the end of the last year in a Performance
Cycle. Subject to approval of the Committee, awards may be deferred
into a capital accumulation plan as provided for in an irrevocable deferred
compensation election during the second year of the Performance
Cycle. If the Committee, in its discretion, so determines, payment of
all or part of an Award to one or more Participants may be deferred in cash
stock for a period provided in the Company’s Deferred Compensation
Plan. Any such deferral shall be subject to such rules and procedures
for payment as provided in the Deferred Compensation Plan.
Participant's termination of employment with the Company, other than by reason
of death, Disability, or retirement after age 55 with at least 5 years of
service with the Company, the Participant's right to an Award shall be
forfeited. Upon a termination of employment with the Company by
reason of a Participant's death, Disability, or retirement after age 55 with
least 5 years of service with the Company, the Participant's Award will become
fully vested and will be prorated to the Termination Date based on the number
days during the Performance Cycle a Participant was employed. The
Award will be paid to the terminated Participant at the end of the Performance
event of a Change of Control during a Performance Cycle, the Performance
will be deemed to have ended at the end of the month immediately preceding
of the Change of
Control transaction. All Participants shall become fully
vested. The Awards shall be calculated based on a deemed achievement
of the greater of (1) the Performance Target at the target level or (2) an
amount calculated assuming that results achieved through the deemed termination
date of the Performance Cycle were achieved for the full Performance
Cycle. The amount of the Award to be paid to each Participant shall
be prorated by multiplying the calculated Award by a fraction, the numerator
which shall be the actual number of days which have elapsed during the
Performance Cycle (through the deemed termination date) and the denominator
which shall be the total number of days in the Performance
Cycle. Awards shall be determined and paid based on such calculations
within 30 days after the consummation of a Change of Control
6.6 Taxes. The
Company shall withhold all applicable income and other taxes from any Award
payment to any Participant.
Plan shall be unfunded. The Company shall not be required to establish any
special segregation of assets to assure the payment of Awards.
Termination of the Plan. The
Plan is voluntary on the part of the Company, and the Company does not guarantee
to continue the Plan beyond any Performance Cycle. The Board may
alter, amend or terminate this Plan at any time for any reason. Any
alteration, amendment or termination shall take effect upon the date indicated
in the document embodying such alteration, amendment or
termination. No termination shall impair a Participant's right to a
previously granted Award, provided that the conditions to payment of the
event may either a Participant, a former Participant or his or her beneficiary,
spouse or estate sell, transfer, anticipate, assign, hypothecate, or otherwise
dispose of any right or interest under the Plan; and such rights and interests
shall not at any time be subject to the claims of creditors nor be liable
attachment, execution or other legal process.
8.2 Notices. All
notices or other communications by a Participant to the Company or the Committee
under or in connection with this Plan shall be deemed to have been duly given
when received by the Committee, in such form specified by the Committee,
the person, designated by the Committee for that purpose.
the Company, the Board nor the Committee shall be subject to any liability
duty under the Plan except as expressly provided in the Plan, or for any
taken, omitted or suffered in good faith.
in this Plan shall confer upon any Participant the right to continue in the
employ of the Company or shall interfere with or restrict in any way the
of the Company to discharge or change the terms of employment of any Participant
at any time for any reason whatsoever, with or without cause.
provisions of this Plan shall be construed, administered and enforced in
accordance with the laws of the State of Delaware.
8.6 Severability. If
provision of this Plan is held invalid or unenforceable, its invalidity or
unenforceability shall not affect any other provisions of this Plan, and
of each provision which is held invalid or unenforceable, there shall be
as part of this Plan a provision that shall be as similar in terms to such
invalid or unenforceable provision as may be possible and be valid, legal,
contained in this Plan are inserted only as a matter of convenience and for
reference and in no way define, limit, enlarge or describe the scope or intent
of this Plan nor in any way shall affect the construction of any provision
of the Plan is January 1, 2005.