Exhibit 10 (a)

 

THE NEWHALL LAND AND FARMING COMPANY
2002 EQUITY COMPENSATION PLAN

 

AMENDMENT NO. 1

 

This Amendment No. 1 (“Amendment”) to The Newhall Land and Farming Company 2002
Equity Compensation Plan (“Plan”) is implemented as of July 1, 2003 (“Effective
Date”), to amend the Plan to provide that each Director shall receive an Annual
Equity Retainer instead of an Annual Cash Retainer.

 

ARTICLE I

 

DEFINITIONS

 

“Annual Cash Retainer” means the amount designated as the annual cash retainer
portion of the total annual compensation paid to each Independent Director,
which is $24,000 as of the Effective Date.

 

“Annual Equity Retainer” shall have the meaning set forth in Article 4.2A.

 

“Depositary Units” shall mean equity security limited partnership interests in
the Partnership represented by transferable depositary units.

 

“Independent Director Unit Rights” shall have the meaning set forth in Paragraph
A of the Independent Director Unit Rights Agreement attached as Exhibit A to
this Amendment.

 

“Initial Grant” shall have the meaning set forth in Paragraph A of the
Independent Director Unit Rights Agreement attached as Exhibit A to this
Amendment.

 

All terms defined in the Plan, unless otherwise defined herein, shall have the
same meaning in this Amendment.

 

ARTICLE II

 

Section 4.2 of the Plan is hereby deleted and restated in its entirety as
follows:

 

4.2                                 INDEPENDENT DIRECTOR UNITS FEE PROGRAM

 

A.                                   Eligibility.  Each Independent Director, in
lieu of receiving the Annual Cash Retainer, shall receive an Annual Equity
Retainer and Initial Grant upon the terms and conditions of the independent
director units fee program described in the Independent Director Unit Rights
Agreement, attached as Exhibit A to this Amendment (“Annual Equity Retainer”).

 

ARTICLE III

 

Section 4.3 of the Plan is hereby deleted in its entirety.

 

ARTICLE IV

 

Except as otherwise provided in this Amendment, all of the terms and conditions
of the Plan shall remain in full force and effect.  Nothing in this Amendment
shall be construed to affect Independent Directors’ cash or equity compensation
other than the Annual Cash Retainer, including without limitation the grant of
Automatic Options under Article 4.1 of the Plan, and the receipt of cash
compensation for attending meetings in an amount determined by the Board from
time to time.  Nothing in this Amendment shall be construed to affect Unit
Rights granted to employees pursuant to Article 3.5 of the Plan, which shall
continue to be governed by the Plan, the Unit Rights

 

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Agreement and exhibits attached thereto.  In the event of any conflict between
the Plan and this Amendment, this Amendment shall control.

 

To record the adoption of Amendment No. 1, Newhall Management Corporation, a
California corporation, managing general partner of Newhall Management Limited
Partnership, a California limited partnership, managing general partner of The
Newhall Land and Farming Company, a California limited partnership, has caused
this Amendment No. 1 to be executed on behalf of such partnership by its duly
authorized officer this 15th day of April, 2003.

 

 

 

THE NEWHALL LAND AND FARMING COMPANY

 

(A CALIFORNIA LIMITED PARTNERSHIP)

 

 

 

By:

NEWHALL MANAGEMENT LIMITED
PARTNERSHIP, A CALIFORNIA LIMITED
PARTNERSHIP, MANAGING GENERAL
PARTNER

 

 

 

 

By:

NEWHALL MANAGEMENT CORPORATION,
A CALIFORNIA CORPORATION,
MANAGING GENERAL PARTNER

 

 

 

 

 

 

 

By:

/s/ Edward C. Giermann

 

 

 

 

 

 

 

Its:

Secretary and General Counsel

 

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GRANT

 

THE NEWHALL LAND AND FARMING COMPANY

 

NOTICE OF GRANT OF UNIT RIGHTS
PURSUANT TO
THE INDEPENDENT DIRECTOR UNIT RIGHTS AGREEMENT

 

Notice is hereby given of the following grant of a right to receive The Newhall
Land and Farming Company (a California Limited Partnership) (the “Partnership”)
depositary units (“Independent Director Unit Rights”) pursuant to the terms of
The Newhall Land and Farming Company 2002 Equity Compensation Plan (the “Plan”),
Amendment No. 1 to the Plan and the Independent Director Unit Rights Agreement,
attached as Exhibit A to the Amendment (collectively “Amended Plan”):

 

Grantee:

 

 

 

Grant Date:

 

 

 

Number of Unit Rights:

 

 

Receipt of Depositary Unit Certificate:  Grantee shall receive a certificate for
Depositary Units (as defined in the Amended Plan) of the Partnership with
respect to his or her vested Independent Director Unit Rights on the date
Grantee becomes fully vested in all Independent Director Unit Rights granted
pursuant to this Notice of Grant in accordance with the Independent Director
Unit Rights Agreement.  Grantee shall receive one Depositary Unit for each
vested Independent Director Unit Right.

 

Grantee understands that the Independent Director Unit Rights are granted
pursuant to and in accordance with the express terms and conditions of the
Amended Plan.  By signing below, Grantee agrees to be bound by the terms and
conditions of the Amended Plan and the terms and conditions of the Independent
Director Unit Rights Agreement dated as of July 1, 2003, distributed with this
Notice of Grant.

 

Dated:

 

 

THE NEWHALL LAND AND FARMING COMPANY

 

(a California Limited Partnership)

 

 

 

 

 

By:

 

 

 

 

 

Title:

Secretary

 

 

 

 

 

 

GRANTEE

 

 

 

Address:

 

 

 

 

 

 

 

 

 

 

 

 

I designate the following beneficiary(ies):

 

 

 

 

 

Relationship:

 

 

 

Address:

 

 

 

 

 

 

 

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EXHIBIT A TO AMENDMENT

 

THE NEWHALL LAND AND FARMING COMPANY

 

INDEPENDENT DIRECTOR UNIT RIGHTS AGREEMENT

 

The Newhall Land and Farming Company (a California Limited Partnership)
(“Partnership”) has adopted The Newhall Land and Farming Company 2002 Equity
Compensation Plan (“Plan”) for among other purposes attracting and retaining the
services of non-employee Board members of the Partnership or its managing
general partner.

 

Grantee is an Independent Director who renders valuable services to the
Partnership and is entitled to a grant of Independent Director Unit Rights, and
this Agreement is executed pursuant to, and is intended to carry out the
purposes of, the Plan in connection with the Partnership’s grant of Independent
Director Unit Rights to Grantee.

 

A.                                   Grant of Independent Director Unit Rights. 
On July 1, 2003, and on each anniversary thereafter (“Grant Date”) the
Partnership shall grant each Independent Director (“Grantee”) the right to
receive Eight Hundred (800) Depositary Units (“Independent Director Unit
Rights”).

 

The Partnership shall also make an initial grant of Independent Director Unit
Rights to each new Director of the Partnership (“Initial Grant”), prorated from
the first day of the calendar quarter in which such Director’s election or
appointment occurs (“Initial Grant Date”) until the following June 30, in an
amount equal each quarter to the Independent Director Unit Rights granted to
each other Independent Director for that quarter.

 

Example:  An Independent Director who is appointed or elected during the month
of January would receive prorated Independent Director Unit Rights based on
having become an Independent Director during the entire third quarter of a plan
year; accordingly, such an Independent Director would obtain the right to
receive one-half of the total number of Independent Director Unit Rights such
Independent Director would have obtained had such Independent Director been an
Independent Director on July 1 of the preceding year, and on June 30 next
following, one Depositary Unit for each such right, and thereafter, on the
following July 1, such Independent Director would receive Independent Director
Unit Rights pursuant hereto.

 

B.                                     Unit Rights and Vesting.  On June 30,
2004, and on each anniversary thereafter (“Exercise Date”) Grantee shall be
entitled to receive one Depositary Unit for each vested Independent Director
Unit Right.  The Independent Director Unit Rights shall vest at the expiration
of twelve (12) months after the respective Grant Date, subject to termination of
service or acceleration in accordance with the provisions of this Amendment. 
The Partnership may issue a certificate to Grantee evidencing the vested
Depositary Units.  Notwithstanding the foregoing, the Initial Grant shall vest
on June 30 next following the Initial Grant Date.

 

C.                                     Distributions.  If the Partnership
declares a distribution to Depositary Unit holders during the period during
which the Independent Director Unit Rights remain unvested, upon vesting of the
Independent Director Unit Rights, Grantee will receive a check for the amount of
such distributions, without premium or markup of any kind.

 

D.                                    Effect of Termination of Service as
Independent Director.  If Grantee ceases to serve as an Independent Director of
Newhall Management Corporation for any reason, the Independent Director Unit
Rights shall be prorated as of the end of the calendar quarter in which the date
of termination occurs in an amount equal to one quarter of the total number of
Independent Director Unit Rights granted to Grantee for each whole or partial
calendar quarter from the Grant Date, and those Independent Director Unit Rights
shall vest on the date of termination.  In such event, Grantee shall also
receive a check for the distributions referred to in paragraph C above, declared
through the end of the calendar quarter in which the date of termination
occurs.  Independent Director Unit Rights that have not vested in accordance
with this paragraph shall be cancelled automatically and no Depositary Units
shall be issued pursuant to the cancelled Independent Director Unit Rights.

 

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Example:  An Independent Director who terminates service on November 1, 2003
would receive prorated units based on a termination date of December 31, 2003,
i.e. 400 Independent Director Unit Rights for the period July 1, 2003
to December 31, 2003. The remaining 400 unvested Unit Rights would be cancelled.

 

E.                                      Taxes.  Each Independent Director must
arrange with the Partnership for the payment of any federal, state or local
income tax or other tax applicable to the grant of Independent Director Unit
Rights hereunder before the Partnership shall be required to deliver to the
Independent Director the certificate for the Depositary Units.

 

F.                                      Incorporation of Miscellaneous Terms. 
The following paragraphs of the Unit Rights Agreement attached as Exhibit A to
the Plan are incorporated by this reference as if fully set forth herein,
substituting “Independent Director Unit(s) Rights” for “Unit(s) Rights” and
adding “as amended” after “Plan”:  F. (Acceleration of Awards), G. (No
Acceleration of Awards), H. (Cancellation of Awards), I. (Adjustment), J.
(Cancellation and New Grant of Awards), K. (Partnership Structure), M.
(Nontransferability), N. (Privilege of Unitholder Rights), O. (Modifications),
Q. (Grantee Undertaking), R. (Governing Law), S. (Counterparts), T. (Successors
and Assigns), U. (Notices) and V. (Construction).

 

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