Document:

Exhibit 10.2

 

ADOBE SYSTEMS INCORPORATED

2003 EQUITY INCENTIVE PLAN

 

[          
] PERFORMANCE SHARE PROGRAM

AWARD GRANT NOTICE

 

 

Adobe Systems Incorporated (the “Company”),
pursuant to its [      ] Performance
Share Program (the “Program”) under its 2003 Equity
Incentive Plan (the “Plan”), hereby awards to
Participant the award (the “Award”) set
forth below.  This Award is subject to
all of the terms and conditions as set forth herein and in the Performance
Share Award Agreement, the Program and the Plan, all of which are attached
hereto and incorporated herein in their entirety.  Unless otherwise defined herein, capitalized
terms shall have the meanings set forth in the Plan or the Program, as
applicable.

 

	
  Participant:

  	
   

  	
   

  
	
  Date of Grant:

  	
   

  	
   

  
	
  Vesting Commencement Date

  	
   

  	
   

  
	
  Number of Shares of Stock Subject to Target Award:

  	
   

  	
  [            ]
  shares of Stock

  
	
  Number of Shares of Stock Subject to Maximum Award:

  	
   

  	
  200% of number of shares of Stock subject to Target Award

  
	
   

  	
   

  	
   

  
	
  Performance Period:

  	
   

  	
   

  

 

Determination of Actual Award:  On
the Certification Date, and provided that (i) the specified level of
applicable Performance Goals is attained during the Performance Period and (ii) Participant
continues to render Service to the Company or any other Participating Company through
the Certification Date, the Company shall credit Participant with an Actual
Award representing the number of shares of Stock (which may be equal to all or
a portion (including none) of the Maximum Award) as determined by the Committee
based on the degree of achievement of the Other Performance Goals set forth on Exhibit A to the Program and the limitations set forth
in Section 5 of the Performance Share Award Agreement.

 

Vesting Schedule:  The
Actual Award shall vest as to 1/4th of the shares of Stock subject to the
Actual Award on the later of (i) the Certification Date and (ii) the
one year anniversary of the [           ]
(the “First Vesting Date”), and
thereafter as to 1/4th of the shares of Stock subject to the Actual
Award on each of the second, third and fourth anniversaries of the [           ]
(each such date, a “Vesting Date”), so that the
Actual Award will be fully vested as of the fourth anniversary of the Vesting
Commencement Date; provided, however, that
the Participant continues to render Service to the Company or any other
Participating Company through each such vesting date.

 

Delivery of Shares:  Subject to the limitations contained herein
and the provisions of the Plan and the Program, the Company shall deliver to
the Participant the vested shares of Stock subject to the Actual Award as
provided in Section 3 of the Performance Share Award Agreement.

 

Additional Terms/Acknowledgements:  The undersigned Participant acknowledges
receipt of, and understands and agrees to, this Award Grant Notice, the
Performance Share Award Agreement, the Program and the Plan.  Participant further acknowledges that as of
the Date of Grant, this Award Grant Notice, the Performance Share Award
Agreement, the Program, and the Plan set forth the entire understanding between
Participant and the Company regarding the Award and supersede all prior oral
and written agreements on that subject, with the exception of the Adobe Systems
Incorporated Executive Severance Plan in the Event of a Change of Control
and/or the individual written retention agreement in effect on the Date of
Grant between the Company and the Participant, to the extent applicable to the
Participant (such documents, the “Superseding Agreements”).  This Award is a “performance share unit” for
purposes of the Superseding Agreements.

 

	
  ADOBE SYSTEMS INCORPORATED

  
	
   

  
	
   

  
	
  By:

  	
   

  
	
   

  	
  [Name]

  
	
   

  	
  [Title]

  
	
   

  
	
  Address:

  	
  345 Park Avenue

  
	
   

  	
  San Jose, CA 95110-2704 USA

  
			

 

 

 

ADOBE SYSTEMS INCORPORATED

2003 EQUITY INCENTIVE PLAN

 

[            
] PERFORMANCE SHARE PROGRAM

PERFORMANCE SHARE AWARD AGREEMENT

 

Pursuant to the
Award Grant Notice (“Grant Notice”) and this
Performance Share Award Agreement (“Award Agreement”),
Adobe Systems Incorporated (the “Company”)
has awarded you, pursuant to its [      
] Performance Share Program (the “Program”)
under its 2003 Equity Incentive Plan (the “Plan”),
the Maximum Award as indicated in the Grant Notice.  Unless otherwise defined herein or in the
Grant Notice, capitalized terms shall have the meanings set forth in the Plan
or the Program, as applicable.

 

The details of your Award are as follows.

 

5.                                      ENTITLEMENT
TO SHARES.

 

(a)                                  Determination of
Actual Award.

 

(i)                                    Generally.  Provided that (i) the specified level of
applicable Performance Goals is achieved during the Performance Period and (ii) you
continue to render Service to the Company or any other Participating Company
through the Certification Date, then, subject
to the limitations contained herein and to the provisions of the Program and
the Plan, you shall be credited with an Actual Award on the Certification Date
equal to all or a portion (including none) of the Maximum Award, with a
reduction from the Maximum Award determined by the Committee based on
the degree of achievement of the Other Performance Goals set forth on Exhibit A to the Program and, as applicable, based on
any reduction pursuant to Section 5 of this Award Agreement.  If the Committee does reduce the Maximum
Award on account of the degree of achievement of Other Performance Goals, you
will be credited with a portion (or none) of the shares of Stock subject to the
Maximum Award; provided, however, that
(i) if a specified level of Performance Goals (including all Other
Performance Goals) is not achieved during the Performance Period, you will not
be credited with or receive any shares of Stock as an Actual Award, and (ii) the
maximum number of shares of Stock for which you may be credited as an Actual
Award will in no event exceed the Maximum Award.

 

(ii)                                Change of Control.  If a Change of
Control occurs prior to the Certification Date, and provided you continue to
render Service to the Company or any other Participating Company until
immediately prior to the Change of Control, then, as of immediately prior to
the Change of Control, you shall be credited with a pro-rated Actual Award on
such date equal to that number of shares of Stock subject to the Target Award
multiplied by a fraction, the numerator of which is the number of months of
Service (rounded up for any partial months and subject to reduction pursuant to
Section 5) you provided in the Performance Period as of immediately prior
to the Change of Control (but in no event shall you be credited with more than
the number of months in the Performance Period) and the denominator of which is
the number of months in the Performance Period.

 

(b)                                  Vesting.  The Actual
Award shall be subject to vesting in accordance with the Vesting Schedule set
forth on the Grant Notice, subject to such acceleration as provided in Section 1(c) of
this Award Agreement or Superseding Agreement, as applicable.

 

(c)                                  Disability or Death.

 

(i)                                    If your Service terminates prior to the
Certification Date by reason of death or Disability, you (or your heirs in the
case of death) will be credited with a pro-rated Actual Award equal to that
number of shares of Stock that you would have been credited with pursuant to Section 1(a) had
you remained in Service through the applicable date set forth in Section 1(a),
with pro-ration based on the number of months of Service (rounded up for any
partial months of Service and subject to reduction pursuant to Section 5)
you provided in the Performance Period prior to your termination (but in no
event shall you be credited with more than the 

 

 

1

 

number of months in the Performance
Period).  For clarification, if the
Actual Award is determined pursuant to Section 1(a)(ii), the Actual Award
will not be pro-rated twice.  You will be
deemed to have vested in that 1/4th of the shares of Stock subject to the
Actual Award that would have vested on the First Vesting Date.

 

(ii)                                If your Service terminates on or after
the Certification Date, you will be deemed to have vested in that 1/4th of the
shares of Stock subject to the Actual Award that would have vested on the next
Vesting Date (which may be the First Vesting Date if the Certification Date
occurs prior to the first anniversary of the Vesting Commencement Date).

 

(iii)                            The shares of Stock subject to an Actual
Award that vest pursuant to this Section 1(c) shall be issued and delivered
to you (or your heirs in the case of death) pursuant to Section 3 below.

 

6.                                      DIVIDENDS.   Except as
provided in Section 6 below, you shall not receive or be credited with any
payment or other adjustment in the number of shares subject to the Actual Award
for cash dividends that may be made in respect of the shares of Stock to which
your Actual Award relates unless and until, and only to the extent, such Actual
Award has vested.

 

7.                                      DELIVERY OF
SHARES.  Subject to Sections 4 and 12 of
this Award Agreement, the Company shall issue and deliver to you (or your heirs in the case of death) the certificates representing the shares
of Stock subject to a vested Actual Award (the
“Certificates”) within thirty
(30) days following the applicable vesting
date.  If you elect to defer delivery of
the shares of Stock as provided in Section 4 of this Award Agreement,
shares of Stock will be issued and delivered to you on the date or dates that
you elect on your deferral election form. 
The Certificates shall be in such form as is determined by the Company.  No shares of Stock shall be issued prior to
vesting.

 

8.                                      DEFERRAL ELECTION. 
If permitted by the Company to do so, you may elect to defer receipt of
the shares of Stock that would otherwise be issued pursuant to the vesting of
your Award in accordance with the terms and conditions, including the
applicable eligibility requirements, of the Company’s Deferred Compensation
Plan.  The Board (or an appropriate
committee thereof) will, in its sole discretion, establish the rules and
procedures for such deferrals.

 

9.                                      EFFECT OF LEAVES OF ABSENCE. 
Unless otherwise required by law, if you have taken in excess of thirty
(30) days of leaves of absence during a Performance Period, your Actual Award
shall be prorated on the basis of the number of days of Service during the
Performance Period during which you were not on a leave of absence.

 

10.                               NUMBER OF
SHARES.  The number of shares of Stock
subject to your Award will be adjusted from time to time for capitalization
adjustments, as provided in Section 4.2 of the Plan.

 

11.                               SECURITIES
LAW COMPLIANCE.  The grant of your Award and the issuance
of any shares of Stock pursuant to an Actual Award shall be subject to
compliance with all applicable requirements of federal, state or foreign law
with respect to such securities.  You may not be issued any shares of Stock
pursuant to an Actual Award if the issuance of shares of Stock would
constitute a violation of any applicable federal, state or foreign securities
laws or other law or regulations or the requirements of any stock exchange or
market system upon which the Stock may then be listed.  In addition, you may not be issued any shares of Stock pursuant to an Actual Award unless
(i) a registration statement under the Securities Act shall at the time of
issuance be in effect with respect to the shares of Stock or (ii) in the
opinion of legal counsel to the Company, the shares of Stock may be issued in
accordance with the terms of an applicable exemption from the registration
requirements of the Securities Act.  YOU
ARE CAUTIONED THAT THE SHARES OF STOCK MAY NOT BE ISSUED UNLESS THE
FOREGOING CONDITIONS ARE SATISFIED.  The
inability of the Company to obtain from any regulatory body having jurisdiction
the authority, if any, deemed by the Company’s legal counsel to be necessary to
the lawful issuance and sale of any shares of Stock pursuant to an Actual Award
shall relieve the Company of any liability in respect of the failure to issue
or sell such shares as to which such requisite authority shall not have been
obtained.  As a condition to the issuance
of any shares of Stock pursuant to an Actual Award, the Company may require you
to satisfy any qualifications that may be necessary or appropriate, to evidence
compliance with any applicable law or regulation and to make any representation
or warranty with respect thereto as may be requested by the Company.

 

 

2

 

12.                               RESTRICTIVE LEGENDS. 
The shares of Stock issued pursuant to an Actual Award shall be endorsed
with appropriate legends, if any, determined by the Company.

 

13.                               TRANSFERABILITY. 
Your Award and any unvested shares of Stock subject to the Actual Award
are not transferable, except by will or by the laws of descent and
distribution.  Notwithstanding the
foregoing, by delivering written notice to the Company, in a form satisfactory
to the Company, you may designate a third party who, in the event of your
death, shall thereafter be entitled to receive any distribution of shares of
Stock pursuant to Section 3 of this Award Agreement.

 

14.                               AWARD NOT A
SERVICE CONTRACT.  Your Award is
not an employment or service contract, and nothing in your Award shall be
deemed to create in any way whatsoever any obligation on your part to continue
in the service of the Company or the Participating Company Group, or on the
part of the Company or Participating Company Group to continue such
service.  In addition, nothing in your
Award shall obligate the Company or the Participating Company Group, their
respective stockholders, boards of directors, Officers or Employees to continue
any relationship that you might have as an Employee, Director or Consultant for
the Company or the Participating Company Group.

 

15.                               UNSECURED
OBLIGATION.  Your Award is
unfunded, and you shall be considered an unsecured creditor of the Company with
respect to the Company’s obligation, if any, to issue shares of Stock pursuant
to an Actual Award under this Award Agreement. 
You shall not have voting or any other rights as a stockholder of the
Company with respect to the Stock acquired pursuant to this Award Agreement
until such Stock is issued to you pursuant to this Award Agreement.  Upon such issuance, you will obtain full
voting and other rights as a stockholder of the Company with respect to the
Stock so issued.  Nothing contained in
this Award Agreement, and no action taken pursuant to its provisions, shall
create or be construed to create a trust of any kind or a fiduciary
relationship between you and the Company or any other person.

 

16.                               WITHHOLDING
OBLIGATIONS.  Regardless of any action taken by the
Company or the Participating Company Group
with respect to any or all income, employment, social insurance, or payroll
taxes, payment on account or other tax-related withholding (“Tax-Related Items”),
you acknowledge that the ultimate liability for all Tax-Related Items legally
due by you is and remains your responsibility and that the Company and Participating Company Group (i) make
no representations or undertakings regarding the treatment of any Tax-Related
Items in connection with any aspect of your Award, the subsequent sale of
shares of Stock acquired pursuant to an Actual Award, or the receipt of any
dividends and (ii) does not commit to structure the terms of the grant or
any other aspect of your Award to reduce or eliminate your liability for
Tax-Related Items.  At the time any Actual Award is determined, at
the time you vest in such Actual Award, at the time you receive a distribution
of shares of Stock pursuant to such Actual Award, or at any other time
reasonably as requested by the Company or the Participating Company Group,
you shall pay or make adequate arrangements satisfactory to the Participating Company Group to satisfy all
withholding obligations of the Participating
Company Group.  In this regard, at the time you receive a distribution of shares
of Stock pursuant to an Actual Award, or at any other time as reasonably
requested by the Company or the Participating Company Group, you hereby
authorize the withholding of that number of whole vested shares of Stock
otherwise deliverable to you pursuant to an Actual Award under this Award
Agreement having a fair market value not in excess of the amount of the
Tax-Related Items determined by the applicable minimum statutory rates.  Finally, you shall pay to the Company or Participating Company Group (as
applicable) any amount of the Tax-Related Items that the Company or the Participating Company Group may be
required to withhold as a result of your participation in the Plan that cannot
be satisfied by the means previously described. 
The Company and the Participating
Company Group shall have no obligation to deliver shares of Stock until
you have satisfied the obligations in connection with the Tax-Related Items as
described in this section.

 

17.                               NATURE OF AWARD. 
In accepting your Award, you acknowledge that:

 

(a)                                  the Plan is established voluntarily by
the Company; it is discretionary in nature and it may be modified, amended,
suspended or terminated by the Company at any time, unless otherwise provided
in the Plan, Program and this Award Agreement;

 

 

3

 

(b)                                  the grant of your Award is voluntary and
occasional and does not create any contractual or other right to receive future
grants of Awards, or benefits in lieu of Awards, even if Awards have been
granted repeatedly in the past;

 

(c)                                  all decisions with respect to future
Awards under the Plan, if any, will be at the sole discretion of the Committee;

 

(d)                                  your participation in the Plan shall not
create a right to further employment with the Company or the Participating
Company Group and shall not interfere with any ability of the Company or the
Participating Company Group to terminate your employment relationship at any
time with or without cause;

 

(e)                                  you are voluntarily participating in the
Plan;

 

(f)                                    an Award is not part of normal or
expected compensation or salary for any purpose, including, but not limited to,
calculating any severance, resignation, termination, redundancy, end-of-service
payments, bonuses, long-service awards, pension or retirement benefits or
similar payments;

 

(g)                                 in the event that you are not an employee
of the Company, your Award will not be interpreted to form an employment
contract or relationship with the Company; and furthermore, your Award will not
be interpreted to form an employment contract with the other members of the
Participating Company Group;

 

(h)                                 the future value of the shares of Stock
subject to your Award is unknown and cannot be predicted with certainty; and

 

(i)                                    no claim or entitlement to compensation
or damages arises from termination of your Award or diminution in value of your
Award or shares of Stock issued pursuant to an Actual Award resulting from
termination of your Service with the Company or the Participating Company Group
(for any reason whether or not in breach of applicable labor laws), and you
irrevocably release the Company and the Participating Company Group from any
such claim that may arise.  If,
notwithstanding the foregoing, any such claim is found by a court of competent
jurisdiction to have arisen then, by executing the Grant Notice, you shall be
deemed irrevocably to have waived your entitlement to pursue such a claim.

 

18.                               DELIVERY OF DOCUMENTS AND
NOTICES.  Any document relating to participating in the
Plan or Program and/or notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given (except to the extent that this
Award Agreement provides for effectiveness only upon actual receipt of such
notice) upon personal delivery, electronic delivery, or upon deposit in the
U.S. Post Office or foreign postal service, by registered or certified mail,
with postage and fees prepaid, addressed to the other party at the e-mail
address, if any, provided for you by the Company or a Participating Company or
at such other address as such party may designate in writing from time to time
to the other party.

 

(a)                                  Description
of Electronic Delivery.  The Plan and Program documents, which may
include but do not necessarily include the Plan prospectus, Grant Notice, Award
Agreement, Certificates, and U.S. financial reports of the Company, may be
delivered to you electronically.  Such
means of delivery may include but do not necessarily include the delivery of a
link to a Company intranet or the internet site of a third party involved in
administering the Plan, the delivery of the document via e-mail or such other
delivery determined at the Committee’s discretion.

 

(b)                                  Consent
to Electronic Delivery.  You
acknowledge that you have read Section 14 of this Award Agreement and
consent to the electronic delivery of the Plan and Program documents, as
described in Section 14 of this Award Agreement.  You acknowledge that you may receive from the
Company a paper copy of any documents delivered electronically at no cost if
you contact the Company by telephone, through a postal service or electronic
mail at equity@adobe.com.  You further
acknowledge that you will be provided with a paper copy of any documents
delivered electronically if electronic delivery fails; similarly, you understand
that you must provide the Company or any designated third party with a paper
copy of any documents delivered electronically if electronic delivery
fails.  Also, you understand that your
consent may be revoked or changed, including any change in the 

 

 

4

 

electronic
mail address to which documents are delivered (if you have provided an
electronic mail address), at any time by notifying the Company of such revised
or revoked consent by telephone, postal service or electronic mail at
equity@adobe.com.  Finally, you
understand that you are not required to consent to electronic delivery.

 

19.                               DATA PRIVACY CONSENT.  You
hereby explicitly and unambiguously consent to the collection, use and
transfer, in electronic or other form, of your personal data as described in
this document by and among the members of the Participating Company Group for
the exclusive purpose of implementing, administering and managing your
participation in the Plan and Program.

 

You understand that the
Company and the Participating Company Group hold certain personal information
about you, including, but not limited to, your name, home address and telephone
number, date of birth, social insurance number or other identification number,
salary, nationality, job title, any shares of Stock or directorships held in
the Company, details of all Awards or any other entitlement to shares of Stock
awarded, canceled, exercised, vested, unvested or outstanding in your favor,
for the purpose of implementing, administering and managing the Plan and
Program (“Data”).  You understand that Data may be transferred
to any third parties assisting in the implementation, administration and
management of the Plan or Program, that these recipients may be located in your
country or elsewhere, and that the recipient’s country may have different data
privacy laws and protections than your country. 
You understand that you may request a list with the names and addresses
of any potential recipients of the Data by contacting your local human
resources representative.  You authorize
the recipients to receive, possess, use, retain and transfer the Data, in
electronic or other form, for the purposes of implementing, administering and
managing your participation in the Plan, including any requisite transfer of
such Data as may be required to a broker or other third party with whom you may
elect to deposit any shares of Stock pursuant to an Actual Award.  You understand that Data will be held only as long as is necessary to
implement, administer and manage your participation in the Plan.  You understand that you may, at any time,
view Data, request additional information about the storage and processing of
Data, require any necessary amendments to Data or refuse or withdraw the
consents herein, in any case without cost, by contacting in writing your local
human resources representative.  You
understand, however, that refusing or withdrawing your consent may affect your
ability to participate in the Plan or Program. 
For more information on the consequences of your refusal to consent or
withdrawal of consent, you understand that you may contact your local human
resources representative.

 

20.                               APPLICATION OF SECTION 409A. 
Notwithstanding any other provision of this Award Agreement, to the
extent that (i) one or more of the payments or benefits received or to be
received by a Participant pursuant to this Award Agreement would constitute
deferred compensation subject to the requirements of Code Section 409A,
and (ii) you are a “specified employee” within the meaning of Code Section 409A,
then such payment or benefit (or portion thereof) will be delayed until the
earliest date following your “separation from service” with the Participating
Company Group within the meaning of Code Section 409A on which the Company
can provide such payment or benefit to you without your incurrence of any
additional tax or interest pursuant to Code Section 409A, with all
payments or benefits due thereafter occurring in accordance with the original
schedule.  In addition, this Award and
the payments and benefits to be provided hereunder are intended to comply in
all respects with the applicable provisions of Code Section 409A.

 

21.                               HEADINGS. 
The headings of the Sections in this Award Agreement are inserted for
convenience only and shall not be deemed to constitute a part of this Award
Agreement or to affect the meaning of this Award Agreement.

 

22.                               AMENDMENT.  The Committee may, without notice, amend, suspend or
terminate the Program; provided, however, that
no such action may adversely affect any then outstanding Award unless (i) expressly
provided by the Committee and (ii) with the consent of you, unless such
action is necessary to comply with any applicable law, regulation or rule.

 

23.                               MISCELLANEOUS.

 

(a)                                  The rights and obligations of the Company
under your Award shall be transferable to any one or more persons or entities,
and all covenants and agreements hereunder shall inure to the benefit of, and
be enforceable by the Company’s successors and assigns.

 

 

5

 

(b)                                  You agree upon request to execute any
further documents or instruments necessary or desirable in the sole
determination of the Company to carry out the purposes or intent of your Award.

 

(c)                                  You acknowledge and agree that you have
reviewed your Award in its entirety, have had an opportunity to obtain the
advice of counsel prior to executing and accepting your Award and fully
understand all provisions of your Award.

 

24.                               GOVERNING
PLAN DOCUMENT.  Your Award is
subject to all the provisions of the Plan and Program, the provisions of which
are hereby made a part of your Award, and is further subject to all
interpretations, amendments, rules and regulations which may from time to
time be promulgated and adopted pursuant to the Plan or Program.  In the event of any conflict between the
provisions of your Award and those of the Plan or Program, the provisions of
the Plan or Program shall control.  In
the event of any conflict between the provisions of the Plan or Program, the
provisions of the Plan shall control.

 

25.                               APPLICABLE LAW. 
This Award Agreement shall be governed by the laws of the State of
California as such laws are applied to agreements between California residents
entered into and to be performed entirely within the State of California.

 

 

6Exhibit 10.3

 

2008 PERFORMANCE SHARE PROGRAM

AWARD CALCULATION METHODOLOGY

EXHIBIT A

 

	
  Parameter

  	
   

  	
  Description

  
	
  Award Metrics

  	
   

  	
  “Initial Meta-Funding
  Gate” requires achievement of GAAP revenues of 90% of Annual Operating Plan
  (AOP) Threshold performance 

  ·   If Initial Meta-Funding Gate is not met, no Actual
  Awards will be earned for 2008

  ·   If Initial Meta-Fund Gate is met, Maximum Awards may
  be earned, subject to reduction based on the achievement of the following
  “Other Performance Goals”:

  ·   Non-GAAP Revenues (including shippable backlog at
  the end of the fiscal year) — Maximum Award reduced to zero if performance
  does not equal or exceed 95% of AOP (AOP revenue goal will be set in
  consideration of beginning of year shippable backlog); and

  ·   Non-GAAP Operating Profit — Maximum Award reduced to
  zero if performance does not equal or exceed 90% of AOP. 

  Actual Awards determined using the matrix provided
  in Section 2, below.

  
	
   

  	
   

  	
   

  
	
  Award Determination

  	
   

  	
  ·   If Initial Meta-Funding Gate is not met, no
  Performance Shares are credited/earned

  ·   If Initial Meta Funding Gate is met, the number of
  Performance Shares credited as an Actual Award is calculated using the matrix
  below

  Step 1: Determine the
  “Performance Share Percentage” based on achievement of the Other Performance
  Goals by using the matrix below:

   

  

   

  

 

 

	
   

  	
   

  	
  Step 2:
  Determine the number of Performance Shares credited as an Actual Award by
  determining the Performance Share Percentage (Step 1) and multiplying that
  percentage by the number of Performance Shares subject to Target Award
  (partial share amounts will be rounded up to the next share)

   

  ·   The maximum number of Performance
  Shares that may be credited as an Actual Award is 200% of the Target Award
  (the “Maximum Award”)

  ·   If achievement is below either Other
  Performance Goal threshold, shares credited are 0% of the Target Award.

  ·   If achievement is at the threshold
  level of performance for both Other Performance Goals, shares credited are
  38% of the Target Award (“Minimum Award”)

  ·   Achievement percents are rounded to the nearest
  whole percent

  ·   Actual number of Performance Shares credited
  as Actual Award is calculated based on achievement, rounded to the nearest
  whole share

   

  See below for
  examples of the Actual Award determination process

   

  
	
  Actual
  Award Determination Examples

  	
   

  	
  Assume:

  ·   Maximum Award of 5,000 Performance Shares

  ·   Target Award of 2,500 Performance Shares 

  

 

	
   

  	
   

  	
  Example
  1

  
	
   

  	
   

  	
  2008 Revenue
  Achievement:

  	
  2008 Operating
  Profit Achievement:

  
	
   

  	
   

  	
  102%
  of AOP

  	
  103%
  of AOP

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Performance
  Share Percentage According to Matrix: 135%

  
	
   

  	
   

  	
  Performance
  Shares Credited as Actual Award:

  
	
   

  	
   

  	
  2,500 Target

  
	
   

  	
   

  	
  X

  
	
   

  	
   

  	
  135%

  
	
   

  	
   

  	
  =

  
	
   

  	
   

  	
  3,375
  Performance Shares

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Example
  2

  
	
   

  	
   

  	
  2008 Revenue
  Achievement:

  	
  2008 Actual
  Operating Profit:

  
	
   

  	
   

  	
  99%
  of AOP

  	
  96%
  of AOP

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Performance
  Share Percentage According to Matrix: 86%

  
	
   

  	
   

  	
  Performance
  Shares Credited as Actual Award:

  
	
   

  	
   

  	
  2,500 Target

  
	
   

  	
   

  	
  X

  
	
   

  	
   

  	
  86%

  
	
   

  	
   

  	
  =

  
	
   

  	
   

  	
  2,150
  Performance Shares

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00135-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00135-of-00352.parquet"}]]