EXHIBIT 10.1
Published on November 13, 1996
Exhibit 10.1
Ball Corporation Long-Term Cash Incentive Plan, dated
October 25, 1994, as amended October 23, 1996
BALL CORPORATION
LONG-TERM CASH INCENTIVE PLAN
(As Amended October 23, 1996)
Section I
Terms and Conditions
The purpose of the Ball Corporation Long-Term Cash Incentive Plan (the "Plan")
is to advance the interests of Ball Corporation (the "Company") and its
subsidiaries by providing a long-term financial incentive to selected key
executives who contribute and are expected to continue to contribute materially
to the success of the Company and its subsidiaries through their leadership
skills, vision and dedication.
Section II
Plan Concept
The Plan, offered in conjunction with the various Ball Stock Option Plans,
provides awards on the basis of Ball's total return (stock price appreciation
plus dividends) performance over three-year performance cycles which begin at
the start of each calendar year.
Section III
Administration of the Plan
The plan shall be administered by the Human Resources Committee of the Board of
Directors (the "Committee"). The Committee shall have full and final authority
to interpret the Plan and the awards granted thereunder, to prescribe, amend and
rescind rules and regulations, if any, relating to the Plan and to make all
determinations necessary or advisable for the administration of the Plan. No
member of the Committee shall be liable for anything done or omitted to be done
by him or by any other member of the Committee in connection with the Plan,
except for his own willful misconduct or gross negligence.
Section IV
Effective Date
The effective date of the Plan is August 1,1994, as adopted by the Board of
Directors of Ball ( the "Board") on October 25, 1994, and as amended effective
October 22, 1996.
Section V
Operation of the Plan
Performance Cycles -- The normal operation of the Plan provides for performance
cycles beginning each January 1, which last for three calendar years. However,
as a transition, there were two phase-in awards which provided the opportunity
for payments at the end of 1995 and 1996, as follows:
1994 | 1995 | 1996 | 1997 | 1998 | 1999 |
8/1/94 --------------> } Phase-In
} Cycles
8/1/94 --------------------------> }
1/1/95-------------------------->
1/1/96--------------------------->
1/1/97----------------------------->
1/1/98------------------->
1/1/99------->
Participation -- Participants in the Plan and individual participation
opportunities shall be determined by the Committee. Actual awards will be
dependent on performance levels as explained below. The amount of the award will
be prorated for performance greater than minimum but less than target and for
performance greater than target but less than maximum.
Performance Requirements -- Awards are dependent upon Ball's total shareholder
return over the performance period (defined as stock price appreciation plus
dividends assumed to be reinvested). For the transition cycles beginning August
1, 1994, and ending December 31, 1995 and 1996, the performance requirements,
defined in terms of average annual compound rate of growth in total shareholder
return, are as follows:
Minimum -- 8% annual growth
Target -- 12% annual growth
Maximum -- 20% annual growth
In calculating the stock price under the Plan, the average of the five trading
days ending at the beginning and at the end of the performance period will be
used.
For cycles ending December 31, 1997, 1998 and 1999, the performance
requirements, in terms of annual average compound rate of growth in total
shareholder return, comparing average daily Ball closing stock prices and
dividends in the third year of the cycle with the average daily closing stock
prices and dividends in the year 1996, as compared with those for the S&P 400
stock index, are as follows:
*Minimum -- the 37.5th percentile of the S&P 400 stock index
Target -- the 50th percentile of the S&P 400 stock index
Maximum -- the 75th percentile of the S&P 400 stock index
*For the cycles ending December 31, 1997 and 1998, total shareholder
return must be positive to result in a payout.
For cycles ending December 31, 2000, and later, the performance requirements
will remain as above, except that in determining the annual average compound
rate of growth in total shareholder return, the average daily closing stock
prices in the third year of the cycle will be compared with the average daily
closing stock prices in the year prior to the start of the cycle.
Form and Timing of Payment -- The awards will be made in cash as soon as
practical after the close of the Performance Period, but no later than March 15
of the year following the close of such period. However, for those executives
whose Ball Corporation stock holdings are below the established guidelines, up
to one-half of the award will be made in restricted stock.
SECTION VI
Terms and Conditions
Termination of Employment Due to Death, Disability or Retirement -- If death,
disability or early or normal retirement, as defined in the Ball Pension Plan
for Salaried Employees, occurs prior to the end of one or more cycles in which
an executive was a participant, the participant's performance award for each
such cycle will be paid as provided in Section V hereof, except the award under
this paragraph shall be calculated as follows for each cycle in which the
terminated executive was a participant:
Award Opportunity achieved under the plan for each full performance
cycle times a fraction, the numerator of which is the number of
calendar days of continuous employment completed by the participant
during each cycle and the denominator of which is the total number of
calendar days in the cycle.
Beneficiary Designation for Termination by Death -- A participant may designate
a beneficiary or beneficiaries who, upon the participant's death, are to receive
the amounts that otherwise would have been paid to the participant. All
designations shall be in writing and signed by the participant. The designation
shall be effective only if and when delivered to Ball during the lifetime of the
participant. The participant may change his/her beneficiary or beneficiaries
with a signed, written instrument delivered to Ball. Payouts shall be in
accordance with the last unrevoked written designation of beneficiary that has
been signed and delivered to Ball's senior vice president of administration.
Termination of Employment for Reasons Other Than Death, Disability or Retirement
- -- If a participant's employment is terminated by Ball other than for cause,
prior to the end of one or more performance cycles, payout shall be in
accordance with the same terms as for termination due to death, disability or
retirement as described above. If termination is for cause, the participant
shall not be entitled to any payout with respect to any incomplete performance
cycle.
Merger, Consolidation or Acquisition -- In the event of a merger, consolidation,
or acquisition such that Ball is not the surviving corporation, performance
awards will become immediately payable based on the performance achieved as of
the end of the most recently completed calendar year for each cycle as to which
the grant of award opportunities has occurred at least six months previously.
Recapitalization -- In the event of any increase or decrease in the total number
of shares of Ball Corporation common stock resulting from a subdivision or
consolidation of shares or other capital adjustment or the payment of a stock
dividend or other increase or decrease in such shares effected without receipt
of consideration by Ball, Ball's total shareholder return calculation shall be
adjusted for each incomplete performance cycle at the effective date of such
recapitalization, as if such recapitalization had been effected at the beginning
of each such performance cycle.
Nonalienation of Benefits -- Neither the participant nor any designated
beneficiary under the Plan shall have the power to transfer, assign, anticipate,
hypothecate, or otherwise encumber in advance any of the benefits payable
hereunder, nor shall said benefits be subject to seizure for the payment of any
debts or judgments or be transferable by operation of law in the event of
bankruptcy, insolvency or otherwise.
No Right to Continued Employment -- Ball may continue to employ a participant in
such capacity or position as it may from time to time determine, but Ball
retains the right to terminate the participant's employment with or without
cause. Ball also retains the right to terminate the Plan, but only with respect
to performance cycles not yet begun, and all the participant's rights hereunder,
whether or not the participant's employment is terminated.