ex-1011.htm


     

    
      	 EXHIBIT
      10.11
	 
	 


    

     

    
      STOCK
APPRECIATION RIGHTS AGREEMENT RELATING TO A STOCK OPTION GRANTED UNDER THE DOW
CHEMICAL COMPANY 1988 AWARD AND OPTION PLAN

       

      The Dow
Chemical Company (“the Company” or “Dow”) has delivered to you prospectus
material pertaining to shares of Dow Common Stock covered by The Dow Chemical
Company 1988 Award and Option Plan (“the Plan”). This instrument is referred to
herein as “this Agreement.” Terms that are used herein and defined in the Plan
are used as defined in the Plan. THIS DOCUMENT CONSTITUTES PART OF A PROSPECTUS
COVERING SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933.

       

      TERMS AND
CONDITIONS

       

       

      
        	
                1.

              	
                This
      Agreement is in all respects subject to the provisions of the Plan, as the
      Plan may be amended from time to time. The Plan is incorporated by
      reference. In the event of any conflict between this Agreement and the
      Plan, as the Plan may be amended from time to time, the provisions of the
      Plan shall govern and this Agreement shall be deemed to be modified
      accordingly.

              


      

       

      
        	
                2.

              	
                Subject
      to the vesting and exercise periods specified on the accompanying award
      letter to this Agreement and the conditions described below, this
      Agreement grants you the right to receive cash payment based on the
      appreciation between the exercise price of ______ and the Fair Market
      Value of the Common Stock of the Company (“SAR”).   Upon
      exercise of the SAR, the related Option shall be canceled automatically to
      the extent of the number of shares covered by such exercise. Conversely,
      if the related Option is exercised, the related SAR shall be cancelled
      automatically to the extent of the number of shares covered by the Option
      exercise.

              


      

       

      
        	
                3.

              	
                Notice
      of the exercise of this SAR in whole or in part shall be made to Morgan
      Stanley Smith Barney via on-line trading, or Customer Service. Prior to
      notice of such exercise, you (or your successors) shall make arrangements
      satisfactory to the Compensation Committee for the payment of any taxes
      required to be withheld in connection with the exercise of this SAR under
      all applicable laws and regulations of any governmental authority, whether
      federal, state or local and whether domestic or foreign. The Company and
      its Subsidiaries and Affiliates (collectively and individually a “Dow
      Company”) and their directors, officers, employees, or agents shall not be
      liable for any delay in issuance or receipt of any shares pursuant to this
      Agreement.

              


      

       

      
        	
                4.

              	
                This
      Agreement shall terminate and your rights under this Agreement shall be
      forfeited if your employment with any Dow Company is terminated for any
      reason other than death, disability or retirement, or Special Separation
      Situation. In the event of your death, disability, or retirement while
      employed by a Dow Company, this Agreement shall, except as provided below,
      terminate upon the earlier of (a) five years after your death, disability
      or retirement or (b) the original expiration date of this Agreement as
      specified on the attachments to this Agreement. In the event of your
      retirement, disability or death, your current year’s SAR will be prorated
      based on the time period worked during the year. If you take a leave of
      absence from a Dow Company, for any reason, your award under this
      Agreement will be subject to the leave of absence policy established by
      the Compensation Committee for Plan awards. For purposes of this
      Agreement, “retirement” is defined in your home country retirement policy
      in effect at the inception of this Agreement You shall be considered to be
      disabled for purposes of this Agreement in the event you, by reason of any
      medically determinable physical or mental impairment which can be expected
      to result in death or which can be expected to last for a continuous
      period of not less than 12 months, are receiving income replacement
      benefits for a period of not less than 3 months under an accident and
      health plan or arrangement covering employees of the
      Company.  Your death or disability shall not accelerate the
      vesting period of SARs under this
Agreement.

              


      

       

      
        	
                5.

              	
                A
      “Special Separation Situation” is defined as a situation in which (a) a
      Dow Company terminates your employment by employer action for a reason
      that qualifies you for a severance benefit (which includes the Special
      Stock Treatment described in this section 5) under a severance plan
      sponsored by a Dow Company, and (i) you fulfill the requirements of the
      severance plan in order to qualify for payment of the severance benefit,
      and (ii) you and the Dow Company sign a Release that provides for the
      Special Stock Treatment described in this section 5; or (b) a Dow Company
      terminates your employment by employer action, and: i) you do not qualify
      for a severance benefit under a severance plan sponsored by the Dow
      Company under the circumstances specified in paragraph 5a, and ii) the
      reason for termination was not because of the violation of an employer
      rule, or a law, regulation or other such government requirement, or
      dishonesty or theft, or because you engaged in activity harmful to the
      interests of, or in competition with, a Dow Company, and iii) you and the
      Dow Company sign a Release that provides for the Special Stock Treatment
      described in this section 5. If your employment is terminated under a
      Special Separation Situation, then your Award shall receive Special Stock
      Treatment.  Special
      Stock Treatment means that with respect to any unexpired, unexercised
      portion of the SAR under this Agreement, the time period for vesting and
      exercise will continue for one year from the effective date of termination
      of employment, but not to exceed the original expiration date of the
      grant.

              


      

       


      
        
           


        

        
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                6.

              	
                If
      (a) you exercise any portion of this SAR prior to the expiration date of
      this SAR, and (b) you leave the employment of a Dow Company within one
      year after such exercise for any reason except death, disability or
      retirement, then any excess of the Fair Market Value over the Valuation
      Price on the date of exercise shall be paid by you to the Company. You may
      be released from this obligation to pay the Company only if the
      Compensation Committee (or its duly appointed agent or agents) determines
      in its or their sole judgment that such action is in the best interests of
      a Dow Company.

              


      

       

      
        	
                7.

              	
                Your
      right to exercise this SAR may not be sold, pledged, or otherwise
      transferred (except as hereinafter provided) and any attempt to sell,
      pledge, assign or otherwise transfer shall be void and your rights to the
      SAR shall therefore be forfeited. Your right to exercise such SAR shall,
      however, be transferable by will or pursuant to the laws of descent and
      distribution or you may make a written designation of a beneficiary on the
      form prescribed by the Company, which beneficiary (if any) shall succeed
      to your rights under this Agreement in the event of your
      death.

              


      

       

      
        	
                8.

              	
                If
      at any time during the term of this Agreement you engage in any act of
      Unfair Competition (as defined below), this Agreement shall terminate
      effective on the date on which you enter into such act of Unfair
      Competition, unless terminated sooner by operation of another term or
      condition of this Agreement or the Plan. In addition, if at any time
      within three years after you exercise any portion of this SAR you engage
      in any act of Unfair Competition, you shall promptly pay to the Company
      any excess of the Fair Market Value over the exercise price on the date of
      exercise. The Compensation Committee shall, in its sole discretion,
      determine when any act of Unfair Competition has occurred, and the
      determination of the Compensation Committee shall be final and binding as
      to all parties. For purposes of this Agreement, the term “Unfair
      Competition” shall mean and include activity on your part that is in
      competition with a Dow Company or is or may be harmful to the interests of
      a Dow Company, including but not limited to conduct related to your
      employment for which either criminal or civil penalties against you may be
      sought, or your acceptance of employment with an employer that is in
      competition with a Dow Company.

              


      

       

      
        	
                9.

              	
                In
      the event that additional shares of Common Stock of the Company are issued
      pursuant to a stock split or a stock dividend, the Board of Directors
      shall make appropriate adjustments in the number and kind of SARs credited
      to your account and the Option price on the books of the Company as deemed
      appropriate, provided that any adjustment to a SAR shall be made in a
      manner that will not result in the grant of a new SAR under Code Section
      409A.

              


      

       

      
        	
                10.

              	
                Nothing
      contained in this Agreement shall confer or be deemed to confer upon you
      any right with respect to continuance of employment by a Dow Company, nor
      interfere in any way with the right of a Dow Company to terminate your
      employment at any time with or without assigning a reason
      therefore.

              


      

       

      
        	
                11.

              	
                This
      instrument shall constitute a Stock Appreciation Rights Agreement between
      the Company and you, and this Agreement shall be deemed to have been made
      on _____. To the extent that federal laws do not otherwise control, this
      Agreement shall be governed by the laws of the state of Delaware and
      construed accordingly. Subject to earlier termination by operation of
      another term or condition of this Agreement or the Plan, this Agreement
      expires when the SAR granted under this Agreement or underlying Option
      corresponding to this SAR has been exercised or on the expiration date
      outlined in the letter attached to this Agreement, whichever date is
      earlier. You may choose to reject this award by written notice delivered
      to the Compensation Committee of the Company within ninety days of your
      receipt of this instrument. Individuals who reject this SAR will not
      receive additional cash or non-cash compensation in lieu of the
      SAR.

              


      

       

      
        
          	
                  12.

                	
                  Upon
      the occurrence of a Change of Control as defined in the Plan, your right
      to receive the number of SARS credited to your account under this
      Agreement shall not be forfeitable under any circumstances.  If
      you also experience an involuntary Separation from Service from Dow or an
      affiliate thereof within two years following a Change of Control, the
      Company shall deliver the SARs to you on the 30th day following such
      Separation from Service.

                


        

         

      

      
        
           


        

        
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