REQUIRED BY SECTION 4.2.
NO GRANTEE MAY BE
GRANTED CASH ANNUAL INCENTIVE AWARDS OR OTHER CASH AWARDS IN ANY ONE CALENDAR
YEAR, THE MAXIMUM PAYOUT FOR WHICH, WHEN ADDED TO THE MAXIMUM PAYOUT FOR ALL
OTHER CASH AWARDS GRANTED TO SUCH GRANTEE IN THE SAME CALENDAR YEAR, SHALL
EXCEED 600% OF THE GRANTEE'S ANNUAL BASE SALARY (UP TO A MAXIMUM OF $2,000,000
OF BASE SALARY) AS OF THE FIRST DAY OF SUCH CALENDAR YEAR (OR, IF LATER, AS OF
THE DATE ON WHICH THE GRANTEE BECOMES AN EMPLOYEE OF THE COMPANY, A SUBSIDIARY
OR A JOINT VENTURE); PROVIDED, HOWEVER, THAT IF THE PERFORMANCE PERIOD
APPLICABLE TO A PERFORMANCE UNIT EXCEEDS TWELVE MONTHS, THE 600% LIMIT SHALL
APPLY TO EACH 12-MONTH PERIOD IN THE PERFORMANCE PERIOD.
4.4
PERFORMANCE-BASED EXCEPTION UNDER
SECTION 162(M).
(A)
PERFORMANCE MEASURES.
UNLESS AND UNTIL THE
COMPANY'S STOCKHOLDERS APPROVE A CHANGE IN THE GENERAL PERFORMANCE MEASURES SET
FORTH IN THIS SECTION 4.4, FOR AWARDS (OTHER THAN OPTIONS OR SARS) DESIGNED TO
QUALIFY FOR THE PERFORMANCE-BASED EXCEPTION, OBJECTIVE PERFORMANCE CRITERIA
SHALL BE ONE OR MORE OF THE FOLLOWING (EACH A "PERFORMANCE MEASURE"), WHICH MAY
BE MEASURED EITHER IN THE AGGREGATE OR ON PER SHARE BASIS:
(I)
EARNINGS MEASURES, INCLUDING NET EARNINGS ON EITHER A LIFO, FIFO
OR OTHER BASIS;
(II)
OPERATING MEASURES, INCLUDING OPERATING INCOME, OPERATING
EARNINGS OR OPERATING MARGIN;
(III)
INCOME OR LOSS MEASURES, INCLUDING NET INCOME OR NET LOSS;
(IV)
CASH FLOW MEASURES, INCLUDING CASH FLOW OR FREE CASH FLOW;
(V)
REVENUE MEASURES;
(VI)
REDUCTIONS IN EXPENSE MEASURES;
(VII)
OPERATING AND MAINTENANCE COST MANAGEMENT AND EMPLOYEE
PRODUCTIVITY MEASURES;
(VIII)
COMPANY RETURN MEASURES, INCLUDING RETURN ON ASSETS, INVESTMENTS,
EQUITY, OR SALES;
(IX)
GROWTH OR RATE OF GROWTH OF ANY OF THE PERFORMANCE MEASURES SET
FORTH HEREIN;
12
(X)
SHARE PRICE (INCLUDING ATTAINMENT OF A SPECIFIED PER-SHARE PRICE
DURING THE PERFORMANCE PERIOD; GROWTH MEASURES AND TOTAL STOCKHOLDER RETURN OR
ATTAINMENT BY THE SHARES OF A SPECIFIED PRICE FOR A SPECIFIED PERIOD OF TIME);
(XI)
STRATEGIC BUSINESS CRITERIA, CONSISTING OF ONE OR MORE OBJECTIVES
BASED ON MEETING SPECIFIED REVENUE, MARKET SHARE, MARKET PENETRATION, BUSINESS
EXPANSION TARGETS, PROJECT MILESTONES, PRODUCTION VOLUME LEVELS AND COST
TARGETS;
(XII)
ACCOMPLISHMENT OF, OR GOALS RELATED TO, MERGERS, ACQUISITIONS,
DISPOSITIONS, PUBLIC OFFERINGS OR SIMILAR EXTRAORDINARY BUSINESS TRANSACTIONS;
OR
(XIII)
ACHIEVEMENT OF BUSINESS OR OPERATIONAL GOALS SUCH AS MARKET
SHARE, BUSINESS DEVELOPMENT AND/OR CUSTOMER OBJECTIVES;
provided that applicable Performance Measures may be applied on a pre- or
post-tax basis; may be established and measured on a Company-wide basis, on a
subsidiary basis, business unit or units basis or other Company division or
segment basis; and provided further that the Committee may, on the Grant Date of
an Award intended to comply with the Performance-Based Exception, and in the
case of other grants, within the allowable adjustment period set forth below in
Section 4.4(c), provide that the formula for such Award may include or exclude
items to measure specific objectives, such as losses from discontinued
operations, extraordinary gains or losses, the cumulative effect of accounting
changes, acquisitions