perfshareprog3rdqtr10q2009.htm


    Exhibit
10.1

     

    OLIN
CORPORATION

     

    PERFORMANCE
SHARE PROGRAM

     

    Codified
to reflect amendments

     

    through
October 22, 2008

     

    
      	
              1.  

            	
              Terms
      and Conditions

            


    

     

    The terms
and conditions of the Performance Share Awards granted under this Program are
contained in the Performance Share Certificate evidencing such Award, this
Program and the LTIP.

     

    
      	
              2.  

            	
              Definitions

            


    

     

    “Common
Stock” means the common stock of Olin, par value $1.00 per share.

     

    “Final
Share Number” has the meaning specified in Section 3 of this
Program.

     

    “LTIP”
means the Olin Corporation benefit plan under which the relevant Performance
Share Award is granted, including the 2003 Long Term Incentive Plan, the 2006
Long Term Incentive Plan and any successor or similar plan.

     

    “Olin”
means Olin Corporation.

     

    “Performance
Cycle” means, with respect to a Performance Share Award, a period of three
calendar years, beginning with the calendar year in which such Performance Share
Award is granted.

     

    “Performance
Share Award” shall mean grants of “Performance Shares” and “Senior Performance
Shares.”

     

    “Performance
Share” and “Senior Performance Share” mean a unit granted under the LTIP and
this Program, maintained on the books of the Company during the Performance
Cycle, denominated as one phantom share of Common Stock, and paid in cash or
Common Stock in accordance with this Program.

     

    “Program”
means this Performance Share Program.

     

    “S&P
ROC” shall
mean the average annual return on capital (calculated in the same manner as
Olin’s Return on Capital) of a group composed of the Standard & Poor’s 1000
Materials companies plus Occidental Petroleum Corporation; Alliant Techsystems
Inc., PPG Industries, Inc.; The Dow Chemical Company and Westlake Chemical
Corporation, broken out by quintiles.

     

    Capitalized
terms not otherwise defined in this Program shall have the meaning specified in
the LTIP.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    
      	
              3.  

            	
              Performance
      Share Awards

            


    

     

    
      	
              a.  

            	
              Awards
      of Senior Performance Shares (category A) under this Program granted
      pursuant to the LTIP are intended to be “performance-based compensation”
      as that term is used in Section 162(m) of the Code.  Each
      Performance Share Award shall establish a target number of Performance
      Shares or Senior Performance Shares awarded to the Participant named in
      such Award.

            


    

     

    
      	
              b.  

            	
              The
      target number of Performance Shares for each Participant shall be adjusted
      based upon a comparison of Olin’s average annual Return on Capital during
      the Performance Cycle with the S&P ROC during the Performance Cycle,
      in accordance with the following
chart:

            


    

     

    
      	
               

              If Olin’s Return on Capital for a Performance
      Cycle is in the:

            	
               

              The
      % of the target number of Performance

              Shares paid will
      be:                      

            
	
              highest
      Quintile of the S&P ROC

            	
              150%

            
	
              2nd
      Quintile of the S&P ROC

            	
              125%

            
	
              3rd
      Quintile of the S&P ROC

            	
              100%

            
	
              4th
      Quintile of the S&P ROC

            	
              50%

            
	
              lowest
      Quintile of the S&P ROC

            	
              25%

            


    

    


    
      	
              c.  

            	
              The
      target number of Senior Performance Shares for each Participant shall be
      adjusted based upon a comparison of Olin’s average annual Return on
      Capital during the Performance Cycle with the S&P ROC during the
      Performance Cycle, in accordance with the following
  chart:

            


    

     

    
      	 
      	
              The
      % of the target number of Senior

              Performance
      Shares paid will be:

            
	
               

              If Olin’s Return on Capital for a Performance
      Cycle is in the:

            	
              A
      Shares

            	
              B
      Shares

            
	
              highest
      Quintile of the S&P ROC

            	
              150%

            	
              150%

            
	
              2nd
      Quintile of the S&P ROC

            	
              125%

            	
              125%

            
	
              3rd
      Quintile of the S&P ROC

            	
              100.0%

            	
              100%

            
	
              4th
      Quintile of the S&P ROC

            	
              33.33%

            	
              100%

            
	
              lowest
      Quintile of the S&P ROC

            	
              0%

            	
              100%

            


    

    


    
      	
              d.  

            	
              As
      soon as practicable in the calendar year following the end of the
      Performance Cycle, the Company shall calculate the appropriate adjustment,
      if any, to the target number of Performance Shares and Senior Performance
      Shares (the “Final Share Number”) for all Participants whose Performance
      Share Awards have vested during or at the end of such Performance
      Cycle.

            


    

     

    
      	
              4.  

            	
              Vesting
      and Forfeiture

            


    

     

    
      	
              a.  

            	
              Except
      as otherwise provided by the Committee, the LTIP, this Program or the
      Performance Share Award certificate, an interest in a Performance Share
      Award shall vest only if the Participant is an employee of the Company or
      a subsidiary on the last day of the relevant Performance
      Cycle.

            


    

     

    
      	
              b.  

            	
              If
      a Participant’s employment with the Company or a subsidiary terminates for
      cause or without the Company’s consent (other than as the result of the
      Participant’s death, disability or retirement) before a Performance Share
      Award has vested, his or her Performance Share Award shall terminate and
      all rights under such Award shall be
forfeited.

            


    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    
      	
              c.  

            	
              If
      a Participant’s employment with the Company or a subsidiary terminates as
      the result of his or her disability, (as that term is defined in Section
      409A of the Code or any successor provision), or retirement under any of
      the Company’s retirement plans before a Performance Share Award has
      vested, the Participant shall be entitled to a pro rata Performance Share
      Award, payable solely in cash at the time that the Performance Share Award
      would otherwise be payable under Section 5.  The cash payment
      shall be equal to the Final Share Number calculated in accordance with
      Sections 3 and 5 of this Program, multiplied by the Fair Market Value on
      the last day of the relevant Performance Cycle, multiplied by a fraction
      with a numerator equal to the number of months during the Performance
      Cycle the Participant was employed by the Company or a subsidiary (rounded
      up to the nearest whole month) and a denominator of
  36.

            


    

     

    
      	
              d.  

            	
              If
      a Participant’s employment with the Company or a subsidiary terminates as
      the result of his or her death before a Performance Share Award has
      vested, the Participant shall be entitled to a pro rata Performance Share
      Award, payable solely in cash within ninety (90) days of the Participant’s
      death.  The cash payment shall be equal to the Participant’s
      target number of Performance Shares or Senior Performance Shares, as the
      case may be, multiplied by the Fair Market Value on the date of the
      Participant’s death (or the next trading day, if the Common Stock was not
      traded on such date), multiplied by a fraction with a numerator equal to
      the number of months during the Performance Cycle the Participant was
      employed by the Company or a subsidiary (rounded up to the nearest whole
      month) and a denominator of 36.

            


    

     

    
      	
              e.  

            	
              If
      a Participant’s employment with the Company or a subsidiary terminates for
      any other reason, the Company shall determine the portion, if any, of the
      Performance Share Award that shall not be forfeited, and the form of
      payment (cash or shares or a combination) that the Participant shall
      receive.  That determination shall be made by the Committee in
      the case of any officer, and by the Chairman of the Board, President,
      Chief Executive Officer, or any Vice President, in the case of any
      non-officer employee.  Notwithstanding this Section 4,
      payment shall be made pursuant to Section
5.

            


    

     

    
      	
              5.  

            	
              Payment
      Timing

            


    

     

    
      	
              a.  

            	
              As
      soon as is administratively practicable after the determination of the
      Final Share Number, but not later than the last day of the calendar year
      following the Performance Cycle, the Company will (i) issue to each
      Participant a number of shares of the Common Stock equal to one-half of
      the Final Share Number, rounded down to the nearest whole share if such
      number is not a whole number, and (ii) pay the Participant an amount equal
      to the Fair Market Value of one-half of the Final Share Number of shares
      of Common Stock on the last day of the Performance Cycle, rounded up to
      the nearest whole share if such number is not a whole
    number.

            


    

     

    
      	
              b.  

            	
              No
      dividends or dividend equivalents shall be paid on any Performance Shares
      or Senior Performance Shares.

            


    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    
      	
              6.  

            	
              Reserved

            


    

     

    
      	
              7.  

            	
              Miscellaneous

            


    

     

    
      	
              a.  

            	
              By
      acceptance of the Performance Share Award, each Participant agrees that
      such Award is special compensation, and that any amount paid will not
      affect:

            


    

     

    
      	
              i.  

            	
              the
      amount of any pension under any pension or retirement plan in which he or
      she participates as an employee of
Olin,

            


    

     

    
      	
              ii.  

            	
              the
      amount of coverage under any group life insurance plan in which he or she
      participates as an employee of Olin,
or

            


    

     

    
      	
              iii.  

            	
              the
      benefits under any other benefit plan of any kind heretofore or hereafter
      in effect, under which the availability or amount of benefits is related
      to compensation.

            


    

     

    
      	
              b.  

            	
              The
      Company will withhold from the distribution of any cash pursuant to
      Performance Share Awards the amount necessary to satisfy the Participant’s
      federal, state and local withholding tax requirements.  It is
      the Company’s intention that all income tax liability on Performance Share
      Awards be deferred in accordance with the applicable requirements of Code
      Section 409A, until the Participant actually receives such shares or
      payment thereof.

            


    

     

    
      	
              c.  

            	
              To
      the extent any provision of the Program (or any Performance Share Award)
      or action by the Board of Directors or Committee would subject any
      Participant to liability for interest or additional taxes under Code
      Section 409A, it will be deemed null and void, to the extent permitted by
      law and deemed advisable by the Committee.  It is intended that
      the Program (and any Performance Share Award) will comply with Code
      Section 409A, and the Program (and any Performance Share Award) shall be
      interpreted and construed on a basis consistent with such
      intent.  The Program (and any Performance Share Award) may be
      amended in any respect deemed necessary (including retroactively) by the
      Committee in order to preserve compliance with Code Section
      409A.  The preceding shall not be construed as a guarantee of
      any particular tax effect for Program benefits or Performance Share
      Awards.  Except as specifically provided in the LTIP, a
      Participant (or beneficiary) is solely responsible and liable for the
      satisfaction of all taxes and penalties that may be imposed on the
      Participant (or beneficiary) in connection with any distributions to such
      Participant (or beneficiary) under the Program (including any taxes and
      penalties under Code Section 409A), and neither Olin nor any Affiliate
      shall have any obligation to indemnify or otherwise hold a Participant (or
      beneficiary) harmless from any or all of such taxes or
      penalties.

            


    

     


    
      
         


      

      
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