{"id":38207,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/1993-stock-option-and-retention-stock-plan-union-pacific-corp.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"1993-stock-option-and-retention-stock-plan-union-pacific-corp","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/1993-stock-option-and-retention-stock-plan-union-pacific-corp.html","title":{"rendered":"1993 Stock Option and Retention Stock Plan &#8211; Union Pacific Corp."},"content":{"rendered":"<pre>================================================================================\n\n\n\n\n\n\n                                      1993\n\n                      STOCK OPTION AND RETENTION STOCK PLAN\n\n                                       OF\n\n                            UNION PACIFIC CORPORATION\n\n\n\n\n\n\n\n\n\n                           (EFFECTIVE APRIL 16, 1993 -\n                         AS AMENDED SEPTEMBER 30, 1993,\n                         JULY 28, 1994, APRIL 24, 1997,\n              NOVEMBER 20, 1997, SEPTEMBER 24, 1998, MAY 27, 1999,\n              MAY 25, 2000, NOVEMBER 16, 2000 AND JANUARY 25, 2001)\n\n\n\n\n\n\n\n\n================================================================================\n\n   2\n\n\n\n                   1993 STOCK OPTION AND RETENTION STOCK PLAN\n                          OF UNION PACIFIC CORPORATION\n\n\n1.       PURPOSE\n\n         The purpose of the 1993 Stock Option and Retention Stock Plan of Union\nPacific Corporation is to promote and closely align the interests of employees\nof Union Pacific Corporation and its shareholders by providing stock based\ncompensation. The Plan is intended to strengthen Union Pacific Corporation's\nability to reward performance which enhances long term shareholder value; to\nincrease employee stock ownership through performance based compensation plans;\nand to strengthen the company's ability to attract and retain an outstanding\nemployee and executive team.\n\n2.       DEFINITIONS\n\n         The following terms shall have the following meanings:\n\n         \"Act\" means the Securities Exchange Act of 1934, as amended.\n\n         \"Affiliate\" shall have the meaning set forth in Rule 12b-2 under\nSection 12 of the Act.\n\n         \"Approved Leave of Absence\" means a leave of absence of definite length\napproved by the Senior Vice President - Human Resources of the Company, or by\nany other officer of the Company to whom the Committee delegates such authority.\n\n         \"Award\" means an award of Retention Shares or Stock Units pursuant to\nthe Plan.\n\n         \"Beneficial Owner\" shall have the meaning set forth in Rule 13d-3 under\nthe Act.\n\n         \"Beneficiary\" means any person or persons designated in writing by a\nParticipant to the Committee on a form prescribed by it for that purpose, which\ndesignation shall be revocable at any time by the Participant prior to his or\nher death, provided that, in the absence of such a designation or the failure of\nthe person or persons so designated to survive the Participant, \"Beneficiary\"\nshall mean such Participant's estate; and further provided that no designation\nof Beneficiary shall be effective unless it is received by the Company before\nthe Participant's death.\n\n         \"Board\" means the Board of Directors of the Company.\n\n         \"Change in Control\" means the occurrence of any one of the following:\n\n(i)      any Person is or becomes the Beneficial Owner, directly or indirectly,\n         of securities of the Company (not including in the securities\n         beneficially owned by such Person any securities acquired directly from\n         the Company or its Affiliates) representing 20% or more of the combined\n         voting power of the Company's then outstanding securities, excluding\n         any Person who becomes such a Beneficial Owner in connection with a\n         transaction described in clause (A) of paragraph (iii) below; or\n\n\n   3\n\n(ii)     the following individuals cease for any reason to constitute a majority\n         of the number of directors then serving: individuals who, on November\n         16, 2000, constitute the Board and any new director (other than a\n         director whose initial assumption of office is in connection with an\n         actual or threatened election contest, including but not limited to a\n         consent solicitation, relating to the election of directors of the\n         Company) whose appointment or election by the Board or nomination for\n         election by the Company's shareholders was approved or recommended by a\n         vote of at least two-thirds (2\/3) of the directors then still in office\n         who either were directors on the date hereof or whose appointment,\n         election or nomination for election was previously so approved or\n         recommended; or\n\n(iii)    there is consummated a merger or consolidation of the Company or any\n         direct or indirect subsidiary of the Company with any other\n         corporation, other than (A) a merger or consolidation which would\n         result in the voting securities of the Company outstanding immediately\n         prior to such merger or consolidation continuing to represent (either\n         by remaining outstanding or by being converted into voting securities\n         of the surviving entity or any parent thereof) more than 50% of the\n         combined voting power of the securities of the Company or such\n         surviving entity or any parent thereof outstanding immediately after\n         such merger or consolidation or (B) a merger or consolidation effected\n         to implement a recapitalization of the Company (or similar transaction)\n         in which no Person is or becomes the Beneficial Owner, directly or\n         indirectly, of securities of the Company (not including in the\n         securities Beneficially Owned by such Person any securities acquired\n         directly from the Company or its Affiliates) representing 20% or more\n         of the combined voting power of the Company's then outstanding\n         securities; or\n\n(iv)     the shareholders of the Company approve a plan of complete liquidation\n         or dissolution of the Company or there is consummated an agreement for\n         the sale or disposition by the Company of all or substantially all of\n         the Company's assets, other than a sale or disposition by the Company\n         of all or substantially all of the Company's assets to an entity, more\n         than 50% of the combined voting power of the voting securities of which\n         is owned by shareholders of the Company in substantially the same\n         proportions as their ownership of the Company immediately prior to such\n         sale.\n\n         \"Code\" means the Internal Revenue Code of 1986, as amended, or the\ncorresponding provisions of any successor statute.\n\n         \"Committee\" means the Committee designated by the Board to administer\nthe Plan pursuant to Section 3.\n\n         \"Common Stock\" means the Common Stock, par value $2.50 per share, of\nthe Company.\n\n         \"Company\" means Union Pacific Corporation, a Utah corporation, or any\nsuccessor corporation.\n\n         \"Option\" means each non-qualified stock option, incentive stock option\nand stock appreciation right granted under the Plan.\n\n                                       2\n   4\n\n         \"Optionee\" means any employee of the Company or a Subsidiary (including\ndirectors who are also such employees) who is granted an Option under the Plan.\n\n         \"Participant\" means any employee of the Company or a Subsidiary\n(including directors who are also such employees) who is granted an Award under\nthe Plan.\n\n         \"Person\" shall have the meaning given in Section 3(a)(9) of the Act, as\nmodified and used in Sections 13(d) and 14(d) thereof, except that such term\nshall not include (i) the Company or any of its Affiliates, (ii) a trustee or\nother fiduciary holding securities under an employee benefit plan of the Company\nor any of its subsidiaries, (iii) an underwriter temporarily holding securities\npursuant to an offering of such securities or (iv) a corporation owned, directly\nor indirectly, by the shareholders of the Company in substantially the same\nproportions as their ownership of stock of the Company.\n\n         \"Plan\" means this 1993 Stock Option and Retention Stock Plan, as\namended from time to time.\n\n         \"Retention Shares\" means shares of Common Stock subject to an Award\ngranted under the Plan.\n\n         \"Restriction Period\" means the period defined in Section 9(a).\n\n         \"Stock Unit\" means the right to receive in the future a share of Common\nStock.\n\n         \"Subsidiary\" means any corporation of which the Company owns directly\nor indirectly at least a majority of the outstanding shares of voting stock.\n\n         \"Unit Restriction Period\" means the period defined in Section 10.\n\n         \"Unit Vesting Condition\" means any condition to the vesting of Stock\nUnits established by the Committee pursuant to Section 10.\n\n         \"Vesting Condition\" means any condition to the vesting of Retention\nShares established by the Committee pursuant to Section 9.\n\n3.       ADMINISTRATION\n\n         The Plan shall be administered by the Committee, which shall be\ncomprised of not less than three members of the Board, none of whom shall be\nemployees of the Company or any Subsidiary. The Committee shall (i) grant\nOptions to Optionees and make Awards of Retention Shares and Stock Units to\nParticipants, and (ii) determine the terms and conditions of such Options and\nAwards of Retention Shares and Stock Units, all in accordance with the\nprovisions of the Plan. The Committee shall have full authority to construe and\ninterpret the Plan, to establish, amend and rescind rules and regulations\nrelating to the Plan, to administer the Plan, and to take all such steps and\nmake all such determinations in connection with the Plan and Options and Awards\ngranted thereunder as it may deem necessary or advisable. Each Option and grant\nof Retention Shares or Stock Units shall, if required by the Committee, be\nevidenced by an \n\n\n                                       3\n   5\n\nagreement to be executed by the Company and the Optionee or Participant,\nrespectively, and contain provisions not inconsistent with the Plan. All\ndeterminations of the Committee shall be by a majority of its members and shall\nbe evidenced by resolution, written consent or other appropriate action, and the\nCommittee's determinations shall be final. Each member of the Committee, while\nserving as such, shall be considered to be acting in his or her capacity as a\ndirector of the Company.\n\n4.       ELIGIBILITY\n\n         To be eligible for selection by the Committee to participate in the\nPlan an individual must be an employee of the Company or a Subsidiary. Directors\nwho are not full-time salaried employees shall not be eligible. In granting\nOptions or Awards of Retention Shares or Stock Units to eligible employees, the\nCommittee shall take into account the duties of the respective employees, their\npresent and potential contributions to the success of the Company or a\nSubsidiary, and such other factors as the Committee shall deem relevant in\nconnection with accomplishing the purpose of the Plan.\n\n5.       STOCK SUBJECT TO THE PLAN\n\n         Subject to the provisions of Section 13 hereof, the maximum number and\nkind of shares as to which Options, or Retention Shares or Stock Units may at\nany time be granted under the Plan are 16 million shares of Common Stock. Shares\nof Common Stock subject to Options or Awards under the Plan may be either\nauthorized but unissued shares or shares previously issued and reacquired by the\nCompany. Upon the expiration, termination or cancellation (in whole or in part)\nof unexercised Options, shares of Common Stock subject thereto shall again be\navailable for option or grant as Retention Shares or Stock Units under the Plan.\nShares of Common Stock covered by an Option, or portion thereof, which is\nsurrendered upon the exercise of a stock appreciation right, shall thereafter be\nunavailable for option or grant as Retention Shares or Stock Units under the\nPlan. Upon the forfeiture (in whole or in part) of a grant of Retention Shares\nor Stock Units, the shares of Common Stock subject to such forfeiture shall\nagain be available for option or grant as Retention Shares or Stock Units under\nthe Plan if no dividends have been paid on the forfeited shares, and otherwise\nshall be unavailable for such an option or grant.\n\n6.       TERMS AND CONDITIONS OF NON-QUALIFIED OPTIONS\n\n         All non-qualified options under the Plan shall be granted subject to\nthe following terms and conditions:\n\n         a. Option Price. The option price per share with respect to each option\nshall be determined by the Committee but shall not be less than 100% of the fair\nmarket value of the Common Stock on the date the option is granted, such fair\nmarket value to be determined in accordance with the procedures to be\nestablished by the Committee.\n\n         b. Duration of Options. Options shall be exercisable at such time or\ntimes and under such conditions as set forth in the written agreement evidencing\nsuch option, but in no event \n\n\n                                       4\n   6\n\nshall any option be exercisable subsequent to the tenth anniversary of the date\non which the option is granted.\n\n         c. Exercise of Option. Except as provided in Section 6(h), 6(i), 8(c)\nor 8(d), the shares of Common Stock covered by an option may not be purchased\nprior to the first anniversary of the date on which the option is granted\n(unless the Committee shall determine otherwise), or such longer period or\nperiods, and subject to such conditions, as the Committee may determine, but\nthereafter may be purchased at one time or in such installments over the balance\nof the option period as may be provided in the option. Any shares not purchased\non the applicable installment date may, unless the Committee shall have\ndetermined otherwise, be purchased thereafter at any time prior to the final\nexpiration of the option. To the extent that the right to purchase shares has\naccrued thereunder, options may be exercised from time to time by notice to the\nCompany stating the number of shares with respect to which the option is being\nexercised.\n\n         d. Payment. Shares of Common Stock purchased under options shall, at\nthe time of purchase, be paid for in full. All, or any portion, of the option\nexercise price may, at the discretion of the Committee, be paid by the surrender\nto the Company, at the time of exercise, of shares of previously acquired Common\nStock owned by the Optionee, to the extent that such payment does not require\nthe surrender of a fractional share of such previously acquired Common Stock. In\naddition, to the extent permitted by the Committee, the option exercise price\nmay be paid by authorizing the Company to withhold Common Stock otherwise\nissuable on exercise of the option. Such shares previously acquired or shares\nwithheld to pay the option exercise price shall be valued at fair market value\non the date the option is exercised in accordance with the procedures to be\nestablished by the Committee. A holder of an option shall have none of the\nrights of a stockholder until the shares of Common Stock are issued to him or\nher. If an amount is payable by an Optionee to the Company or a Subsidiary under\napplicable withholding tax laws in connection with the exercise of non-qualified\noptions, the Committee may, in its discretion and subject to such rules as it\nmay adopt, permit the Optionee to make such payment, in whole or in part, by\nelecting to authorize the Company to withhold or accept shares of Common Stock\nhaving a fair market value equal to the amount to be paid under such withholding\ntax laws.\n\n         e. Restrictions. The Committee shall determine, with respect to each\noption, the nature and extent of the restrictions, if any, to be imposed on the\nshares of Common Stock that may be purchased thereunder including restrictions\non the transferability of such shares acquired through the exercise of such\noption. Without limiting the generality of the foregoing, the Committee may\nimpose conditions restricting absolutely or conditionally the transferability of\nshares acquired through the exercise of options for such periods, and subject to\nsuch conditions, including continued employment of the Optionee by the Company\nor a Subsidiary, as the Committee may determine.\n\n         f. Purchase for Investment. The Committee shall have the right to\nrequire that each Optionee or other person who shall exercise an option under\nthe Plan represent and agree that any shares of Common Stock purchased pursuant\nto such option will be purchased for investment and not with a view to the\ndistribution or resale thereof or that such shares will not be \n\n\n                                       5\n   7\n\nsold except in accordance with such restrictions or limitations as may be set\nforth in the written agreement granting such option.\n\n         g. Non-Transferability of Options. During an Optionee's lifetime, the\noption may be exercised only by the Optionee. Options shall not be transferable,\nexcept for exercise by the Optionee's legal representatives or heirs.\n\n         h. Termination of Employment. Upon the termination of an Optionee's\nemployment for any reason other than death, then, except as provided below, the\noption shall be exercisable only as to those shares of Common Stock which were\nthen subject to the exercise of such option (provided that the Committee may\ndetermine that particular limitations and restrictions under the Plan shall not\napply) and such option shall expire according to the following schedule (unless\nthe Committee shall provide for shorter periods at the time the option is\ngranted):\n\n                  (i)      Retirement. Option shall expire, unless exercised,\n                           five (5) years after the Optionee's retirement from\n                           the Company or any Subsidiary under the provisions of\n                           the Company's or a Subsidiary's pension plan.\n\n                  (ii)     Disability. Any holding period required by Section\n                           6(c) shall automatically be deemed to be satisfied\n                           and Option shall expire, unless exercised, five (5)\n                           years after the date the Optionee is eligible to\n                           receive disability benefits under the provisions of\n                           the Company's or a Subsidiary's long-term disability\n                           plan.\n\n                  (iii)    Disposition of Business. In the case of a termination\n                           resulting from the disposition by the Company or any\n                           of its Subsidiaries of all or a part of its interest\n                           in, or the discontinuance of a business of, a\n                           subsidiary, division or other business unit, unvested\n                           options shall not be forfeited, but any holding\n                           period required by Section 6(c) shall be satisfied in\n                           accordance with its original schedule (including any\n                           holding period associated with an option that becomes\n                           a non-qualified option in accordance with Section\n                           8(c)) and Option shall expire, unless exercised, five\n                           (5) years after the date of termination;\n\n                  (iv)     Force Reduction Program. In the case of a termination\n                           (other than retirement) resulting from a force\n                           reduction program instituted by the Company or any of\n                           its Subsidiaries, the Option shall expire, unless\n                           exercised, three (3) years from the date of\n                           termination.\n\n                  (v)      Gross Misconduct. Option shall expire upon receipt by\n                           the Optionee of the notice of termination if he or\n                           she is terminated for deliberate, willful or gross\n                           misconduct as determined by the Company.\n\n                  (vi)     Change in Control. In the event an Optionee's\n                           employment is involuntarily terminated by the Company\n                           (other than termination as a result of disability or\n                           gross misconduct, but including a termination\n                           described in subsection (iii) and (iv) above) within\n                           two years following a \n\n\n                                       6\n   8\n\n                           Change in Control all options shall become fully\n                           vested and the option shall remain exercisable for a\n                           period of three (3) years following such termination\n                           (or five (5) years following such termination in the\n                           case of a termination described in Subsection (i),\n                           (iii) or (iv) above) but in no event after the\n                           expiration of the option, and the option shall expire\n                           thereafter.\n\n                  (vii)    All Other Terminations. Option shall expire, unless\n                           exercised, three (3) months after the date of such\n                           termination.\n\n         i. Death of Optionee. Upon the death of an Optionee during his or her\nperiod of employment, the option shall be exercisable only as to those shares of\nCommon Stock which were subject to the exercise of such option at the time of\nhis or her death, provided that (i) any holding period required by Section 6(c)\nshall automatically be deemed to be satisfied and (ii) the Committee may\ndetermine that particular limitations and restrictions under the Plan shall not\napply, and such option shall expire, unless exercised by the Optionee's legal\nrepresentatives or heirs, five (5) years after the date of death (unless the\nCommittee shall provide for a shorter period at the time the option is granted).\n\n         j. Deferral. The Committee may permit an Optionee to elect to defer\nreceipt of all or part of the Common Stock issuable upon the exercise of an\noption, pursuant to rules and regulations adopted by the Committee. The\nCommittee may not permit the payment of cash in lieu of Common Stock upon\npayment of the deferred amount.\n\nIn no event, however, shall any option be exercisable pursuant to Sections 6(h)\nor (i) subsequent to the tenth anniversary of the date on which it is granted.\n\n7.       TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS\n\n         a. General. The Committee may also grant a stock appreciation right in\nconnection with a non-qualified option, either at the time of grant or by\namendment. Such stock appreciation right shall cover the same shares covered by\nsuch option (or such lesser number of shares of Common Stock as the Committee\nmay determine) and shall, except for the provisions of Section 6(d) hereof, be\nsubject to the same terms and conditions as the related non-qualified option.\n\n         b. Exercise and Payment. Each stock appreciation right shall entitle\nthe Optionee to surrender to the Company unexercised the related option, or any\nportion thereof, and to receive from the Company in exchange therefor an amount\nequal to the excess of the fair market value of one share of Common Stock over\nthe option price per share times the number of shares covered by the option, or\nportion thereof, which is surrendered. Payment shall be made in shares of Common\nStock valued at fair market value, or in cash, or partly in shares and partly in\ncash, all as shall be determined by the Committee. The fair market value shall\nbe the value determined in accordance with procedures established by the\nCommittee. Stock appreciation rights may be exercised from time to time upon\nactual receipt by the Company of written notice stating the number of shares of\nCommon Stock with respect to which the stock appreciation right is being\nexercised, provided that if a stock appreciation right expires unexercised, it\nshall be deemed exercised on the expiration date if any amount would be payable\nwith respect thereto. No \n\n\n\n                                       7\n   9\n\nfractional shares shall be issued but instead cash shall be paid for a fraction\nor, if the Committee should so determine, the number of shares shall be rounded\ndownward to the next whole share. If an amount is payable by an Optionee to the\nCompany or a Subsidiary under applicable withholding tax laws in connection with\nthe exercise of stock appreciation rights, the Committee may, in its discretion\nand subject to such rules as it may adopt, permit the Optionee to make such\npayment, in whole or in part, by electing to authorize the Company to withhold\nor accept shares of Common Stock having a fair market value equal to the amount\nto be paid under such withholding tax laws.\n\n         c. Restrictions. The obligation of the Company to satisfy any stock\nappreciation right exercised by an Optionee subject to Section 16 of the Act\nshall be conditioned upon the prior receipt by the Company of an opinion of\ncounsel to the Company that any such satisfaction will not create an obligation\non the part of such Optionee pursuant to Section 16(b) of the Act to reimburse\nthe Company for any statutory profit which might be held to result from such\nsatisfaction.\n\n8.       TERMS AND CONDITIONS OF INCENTIVE STOCK OPTIONS.\n\n         a. General. The Committee may also grant incentive stock options as\ndefined under Section 422 of the Code. All incentive stock options issued under\nthe Plan shall, except for the provisions of Sections 6(h) and (i) and Section 7\nhereof, be subject to the same terms and conditions as the non-qualified options\ngranted under the Plan. In addition, incentive stock options shall be subject to\nthe conditions of Sections 8(b), (c), (d) and (e).\n\n         b. Limitation of Exercise. The aggregate fair market value (determined\nas of the date the incentive stock option is granted) of the shares of stock\nwith respect to which incentive stock options are exercisable for the first time\nby such Optionee during any calendar year, under this Plan or any other stock\noption plans adopted by the Company, its Subsidiaries or any predecessor\ncompanies thereof, shall not exceed $100,000. If any incentive stock options\nbecome exercisable in any year in excess of the $100,000 limitation, options\nrepresenting such excess shall become non-qualified options exercisable pursuant\nto the terms of Section 6 hereof and shall not be exercisable as incentive stock\noptions.\n\n         c. Termination of Employment. Upon the termination of an Optionee's\nemployment, for any reason other than death, his or her incentive stock option\nshall be exercisable only as to those shares of Common Stock which were then\nsubject to the exercise of such option except as provided below (provided that\nthe Committee may determine that particular limitations and restrictions under\nthe Plan shall not apply) and such option shall expire as an incentive stock\noption according to the following schedule (unless the Committee shall provide\nfor shorter periods at the time the incentive stock option is granted) but\nshall, in all cases other than 8(c)(iii) and 8(c)(iv), at the end of the period\nreferred to below become a non-qualified option exercisable pursuant to the\nterms of Section 6 hereof (including Sections 6(h) and (i)) less the period\nalready elapsed under such Section:\n\n                  (i)      Retirement. An incentive stock option shall expire,\n                           unless exercised, three (3) months after the\n                           Optionee's retirement from the Company or any\n\n\n                                       8\n   10\n\n                           Subsidiary under the provisions of the Company's or a\n                           Subsidiary's pension plan.\n\n                  (ii)     Disability. In the case of an Optionee who is\n                           disabled within the meaning of Section 22(e)(3) of\n                           the Code, any holding period required by Section 6(c)\n                           shall automatically be deemed to be satisfied and an\n                           incentive stock option shall expire, unless\n                           exercised, one (1) year after the earlier of the date\n                           the Optionee terminates employment or the date the\n                           Optionee is eligible to receive disability benefits\n                           under the provisions of the Company's or a\n                           Subsidiary's long-term disability plan.\n\n                  (iii)    Gross Misconduct. An incentive stock option shall\n                           expire upon receipt by the Optionee of the notice of\n                           termination if he or she is terminated for\n                           deliberate, willful or gross misconduct as determined\n                           by the Company.\n\n                  (iv)     All Other Terminations. An incentive stock option\n                           shall expire, unless exercised, three (3) months\n                           after the date of such termination.\n\n         d. Incentive Stock Options Granted On and After May 25, 2000. In the\ncase of an incentive stock option granted on or after May 25, 2000, the\nfollowing additional provisions shall apply:\n\n                  (i)      Disposition of Business. Subject to Section 8(e), in\n                           the case of a termination resulting from the\n                           disposition by the Company or any of its Subsidiaries\n                           of all or a part of its interest in, or the\n                           discontinuance of a business of, a subsidiary,\n                           division or other business unit, unvested options\n                           shall not be forfeited, but any holding period\n                           required by Section 6(c) shall be satisfied in\n                           accordance with its original schedule and the Option\n                           shall expire, unless exercised, three (3) months\n                           after the date of termination, but shall at the end\n                           of such three month period become a non-qualified\n                           option exercisable pursuant to the terms of Section 6\n                           hereof (including Section 6(h)(iii), less the period\n                           already elapsed hereunder); \n\n                  (ii)     Force Reduction Program. Subject to Section 8(e), in\n                           the case of a termination (other than retirement)\n                           resulting from a force reduction program instituted\n                           by the Company or any of its Subsidiaries, the Option\n                           shall expire, unless exercised, three (3) months\n                           after the date of termination, but shall at the end\n                           of such three (3) month period become a non-qualified\n                           option exercisable pursuant to the terms of Section 6\n                           hereof (including Section 6(h)(iv), less the period\n                           already elapsed hereunder).\n\n         e. Additional Provisions Regarding Incentive Stock Options Granted On\nOr After November 16, 2000. In the case of an incentive stock option granted on\nor after November 16, 2000, the following additional provisions shall apply:\n\n         In the event an Optionee's employment is involuntarily terminated by\n         the Company (other than termination as a result of disability or gross\n         misconduct, but including a \n\n\n\n                                       9\n   11\n\n         termination described in subsections (d)(i) or (d)(ii) above) within\n         two years following a Change in Control, all options shall become fully\n         vested and the option shall remain exercisable for a period of three\n         (3) months following such termination (but in no event after the\n         expiration of the option) and shall at the end of such three (3) month\n         period become a non-qualified option exercisable pursuant to the terms\n         of Section 6 hereof (including Section 6(h)(vii), less the period\n         already elapsed hereunder).\n\n         f. Additional Provisions Regarding Certain Incentive Stock Options\nGranted Before May 25, 2000. In the case of an incentive stock option granted\nbefore May 25, 2000, the following additional provisions shall apply:\n\n                  (i)      Disposition of Business. In the case of incentive\n                           stock options granted after September 24, 1998 and\n                           before May 25, 2000, in the event that a termination\n                           results from the disposition by the Company of all or\n                           a part of its interest in, or the discontinuance of\n                           the business of, a subsidiary, division or other\n                           business unit of the Company, the Committee may\n                           extend the period during which an incentive stock\n                           option may be exercised as a non-qualified option to\n                           up to five (5) years from the date of such\n                           termination.\n\n                  (ii)     Other Terminations. In the case of incentive stock\n                           options granted after April 24, 1997 and before May\n                           25, 2000, the Committee may extend the period during\n                           which an incentive stock option may be exercised as a\n                           non-qualified stock option to up to three (3) years\n                           from the date of a termination not due to retirement,\n                           disability or gross misconduct or, if later, three\n                           (3) years from the date the option becomes\n                           exercisable but not more than five years after the\n                           date of such termination.\n\n         g. Death of Optionee. Upon the death of an Optionee during his or her\nperiod of employment, the incentive stock option shall be exercisable as an\nincentive stock option only as to those shares of Common Stock which were\nsubject to the exercise of such option at the time of death, provided that (i)\nany holding period required by Section 6(c) shall automatically be deemed to be\nsatisfied, and (ii) the Committee may determine that particular limitations and\nrestrictions under the Plan shall not apply, and such option shall expire,\nunless exercised by the Optionee's legal representatives or heirs, five (5)\nyears after the date of death (unless the Committee shall provide for a shorter\nperiod at the time the option is granted).\n\n         h. Leave of Absence. A leave of absence, whether or not an Approved\nLeave of Absence, shall be deemed a termination of employment for purposes of\nSection 8.\n\nIn no event, however, shall any incentive stock option be exercisable pursuant\nto Sections 8(c) or (d) subsequent to the tenth anniversary of the date on which\nit was granted.\n\n9.       TERMS AND CONDITIONS OF AWARDS OF RETENTION STOCK\n\n         a. General. Retention Shares may be granted only to reward the\nattainment of individual, Company or Subsidiary goals, or to attract or retain\nofficers or other employees of the \n\n\n                                       10\n   12\n\nCompany or any Subsidiary, and shall be granted subject to the attainment of\nperformance goals unless the Committee shall determine otherwise. With respect\nto each grant of Retention Shares under the Plan, the Committee shall determine\nthe period or periods, including any conditions for determining such period or\nperiods, during which the restrictions set forth in Section 9(b) shall apply,\nprovided that in no event, other than as provided in Section 9(c) or in the next\nsentence, shall such restrictions terminate prior to 3 years after the date of\ngrant (the \"Restriction Period\"), and may also specify any other terms or\nconditions to the right of the Participant to receive such Retention Shares\n(\"Vesting Conditions\"). The Committee may determine in its sole discretion to\nwaive any or all of such restrictions prior to end of the Restriction Period or\nthe satisfaction of any Vesting Condition. Subject to Section 9(c) and any such\nVesting Condition, a grant of Retention Shares shall be effective for the\nRestriction Period and may not be revoked; provided, however, in the event of a\nChange in Control of the Company (i) with respect to Retention Shares (other\nthan Retention Shares granted pursuant to the Executive Incentive Premium\nExchange Program (\"PEP Plan\") or the 2001 Long Term Plan (the \"LTP\")), the\nRestricted Period shall end with respect to that number of such Retention Shares\ncalculated by multiplying such Retention Shares by the fraction obtained by\ndividing the number of full months during such Restricted Period through the\ndate of such Change in Control by the total number of months contained in such\nRestricted Period (determined without regard to this proviso), (ii) with respect\nto Retention Shares granted to such Participant pursuant to the PEP Plan, the\nRestricted Period shall end with respect to that number of such Retention Shares\nequal to (x) that number of such Retention Shares with a fair market value (as\nof the date of grant) equal to the amount of incentive award such Participant\nelected to forego in exchange for such Retention Shares (the \"Original Retention\nShares\"), and (y) number of Retention Shares which the Participant received as a\npremium under the PEP Plan (the \"Premium Retention Shares\") calculated by\nmultiplying such Premium Retention Shares by the fraction obtained by dividing\nthe number of full months during such Restricted Period through the date of such\nChange in Control by the total number of months contained in such Restricted\nPeriod, and (iii) Retention Shares granted to such Participant pursuant to the\nLTP shall be subject to the terms of the applicable agreement issued under the\nLTP. In the event a payment becomes due, the Committee may, in its sole\ndiscretion, elect to make such payment either in cash, in shares of Common\nStock, in shares of equity securities of the entity (or its parent) resulting\nfrom such Change in Control or in any combination of the foregoing.\n\n         b. Restrictions. At the time of grant of Retention Shares to a\nParticipant, a certificate representing the number of shares of Common Stock\ngranted shall be registered in the Participant's name but shall be held by the\nCompany for his or her account. The Participant shall have the entire beneficial\nownership interest in, and all rights and privileges of a stockholder as to,\nsuch Retention Shares, including the right to vote such Retention Shares and,\nunless the Committee shall determine otherwise, the right to receive dividends\nthereon, subject to the following: (i) subject to Section 9(c), the Participant\nshall not be entitled to delivery of the stock certificate until the expiration\nof the Restriction Period and the satisfaction of any Vesting Conditions; (ii)\nnone of the Retention Shares may be sold, transferred, assigned, pledged, or\notherwise encumbered or disposed of during the Restriction Period or prior to\nthe satisfaction of any Vesting Conditions; and (iii) all of the Retention\nShares shall be forfeited and all rights of the Participant to such Retention\nShares shall terminate without further obligation on the part of the Company\nunless the Participant remains in the continuous employment of the Company or a\n\n\n                                       11\n   13\n\nSubsidiary for the entire Restriction Period, except as provided by Sections\n9(a) and 9(c), and any applicable Vesting Conditions have been satisfied. Any\nshares of Common Stock or other securities or property received as a result of a\ntransaction listed in Section 13 shall be subject to the same restrictions as\nsuch Retention Shares unless the Committee shall determine otherwise.\n\n         c. Termination of Employment.\n\n                  (i)      Disability and Retirement. Unless the Committee shall\n                           determine otherwise at the time of grant of Retention\n                           Shares, if (A) a Participant ceases to be an employee\n                           of the Company or a Subsidiary prior to the end of a\n                           Restriction Period, by reason of disability under the\n                           provisions of the Company's or a Subsidiary's\n                           long-term disability plan or retirement under the\n                           provisions of the Company's or a Subsidiary's pension\n                           plan either (i) at age 65 or (ii) prior to age 65 at\n                           the request of the Company or a Subsidiary, and (B)\n                           all Vesting Conditions have been satisfied, the\n                           Retention Shares granted to such Participant shall\n                           immediately vest and all restrictions applicable to\n                           such shares shall lapse. A certificate for such\n                           shares shall be delivered to the Participant in\n                           accordance with the provisions of Section 9(d).\n\n                  (ii)     Death. Unless the Committee shall determine otherwise\n                           at the time of grant of Retention Shares, if (A) a\n                           Participant ceases to be an employee of the Company\n                           or a Subsidiary prior to the end of a Restriction\n                           Period by reason of death, and (B) all Vesting\n                           Conditions have been satisfied, the Retention Shares\n                           granted to such Participant shall immediately vest in\n                           his or her Beneficiary, and all restrictions\n                           applicable to such shares shall lapse. A certificate\n                           for such shares shall be delivered to the\n                           Participant's Beneficiary in accordance with the\n                           provisions of Section 9(d).\n\n                  (iii)    All Other Terminations. If a Participant ceases to be\n                           an employee of the Company or a Subsidiary prior to\n                           the end of a Restriction Period for any reason other\n                           than death, disability or retirement as provided in\n                           Section 9(c)(i) and (ii) or a termination pursuant to\n                           Section 9(c)(v), the Participant shall immediately\n                           forfeit all Retention Shares then subject to the\n                           restrictions of Section 9(b) in accordance with the\n                           provisions thereof, except that the Committee may, if\n                           it finds that the circumstances in the particular\n                           case so warrant, allow a Participant whose employment\n                           has so terminated to retain any or all of the\n                           Retention Shares then subject to the restrictions of\n                           Section 9(b) and all restrictions applicable to such\n                           retained shares shall lapse. A certificate for such\n                           retained shares shall be delivered to the Participant\n                           in accordance with the provisions of Section 9(d).\n\n                  (iv)     Vesting Conditions. Unless the Committee shall\n                           determine otherwise at the time of grant of Retention\n                           Shares, if a Participant ceases to be an employee of\n                           the Company for any reason prior to the satisfaction\n                           of any Vesting Conditions, the Participant shall\n                           immediately forfeit all Retention Shares then subject\n                           to the restrictions of Section 9(b) in accordance\n                           with \n\n\n                                       12\n   14\n\n                           the provisions thereof, except that the Committee\n                           may, if it finds that the circumstances in the\n                           particular case so warrant, allow a Participant whose\n                           employment has so terminated to retain any or all of\n                           the Retention Shares then subject to the restrictions\n                           of Section 9(b) and all restrictions applicable to\n                           such retained shares shall lapse. A certificate for\n                           such retained shares shall be delivered to the\n                           Participant in accordance with the provisions of\n                           Section 9(d).\n\n                  (v)      Change in Control. In the event a Participant's\n                           employment is involuntarily terminated by the Company\n                           (other than a termination as a result of death,\n                           disability, retirement or gross misconduct) within\n                           two years following a Change in Control, the\n                           remaining restrictions with respect to all Original\n                           Retention Shares and all Premium Retention Shares\n                           shall lapse and the Committee may, in its sole\n                           discretion, elect to make such payment either in\n                           cash, in shares of Common Stock, in shares of equity\n                           securities of the entity (or its parent) resulting\n                           from such Change in Control or in any combination of\n                           the foregoing.\n\n         d. Payment of Retention Shares. At the end of the Restriction Period\nand after all Vesting Conditions have been satisfied, or at such earlier time as\nprovided for in Section 9(c) or as the Committee, in its sole discretion, may\notherwise determine, all restrictions applicable to the Retention Shares shall\nlapse, and a stock certificate for a number of shares of Common Stock equal to\nthe number of Retention Shares, free of all restrictions, shall be delivered to\nthe Participant or his or her Beneficiary, as the case may be. If an amount is\npayable by a Participant to the Company or a Subsidiary under applicable\nwithholding tax laws in connection with the lapse of such restrictions, the\nCommittee, in its sole discretion, may permit the Participant to make such\npayment, in whole or in part, by authorizing the Company to transfer to the\nCompany Retention Shares otherwise deliverable to the Participant having a fair\nmarket value equal to the amount to be paid under such withholding tax laws.\n\n         e. Deferral. The Committee may permit a Participant to elect to defer\nreceipt of all or part of any Retention Shares that would otherwise be\ndelivered, pursuant to rules and regulations adopted by the Committee. The\nCommittee may permit the payment of cash in lieu of Common Stock upon payment of\nthe deferred amount.\n\n10.      STOCK UNITS\n\n         The Committee may also grant Awards of Stock Units under the Plan. The\nvesting of Awards of Stock Units shall be subject to the requirement that a\nParticipant continue employment with the Company or a Subsidiary for a certain\nperiod of no less than three years (the \"Unit Restriction Period\"), and may be\nsubject to the satisfaction of other conditions or contingencies (\"Unit Vesting\nCondition\"), in order for a Participant to receive payment of such Award, as\nestablished by the Committee at the time of the Award. The Committee may\ndetermine in its sole discretion to waive any such requirement, condition or\ncontingency. Awards of Stock Units shall be payable in shares of Common Stock.\nThe Committee may permit a Participant to elect to defer receipt of payment of\nall or part of any Award of Stock Units pursuant to rules and regulations\nadopted by the Committee. Unless the Committee \n\n\n                                       13\n   15\n\nprovides otherwise at the time an Award of Stock Units to a Participant is made,\nthe provisions of Section 9(c) of the Plan relating to the vesting and\nforfeiture of Retention Stock upon termination of employment shall apply to any\ntermination of employment by such Participant during the Unit Restricted Period\nor prior to the satisfaction of any Unit Vesting Condition for such Award.\n\n11.      DIVIDENDS AND DIVIDEND EQUIVALENTS\n\n         Any Option or Award of Stock Units may provide the Participant with the\nright to receive dividend payments or dividend equivalent payments on the Common\nStock subject to the Option or Award, whether or not such Option or Award has\nbeen exercised or is vested. Such payments may be made in cash or may be\ncredited to a Participant's account and later settled in cash or Common Stock or\na combination thereof, as determined by the Committee. Such payments and credits\nmay be subject to such conditions and contingencies as the Committee may\nestablish.\n\n12.      REGULATORY APPROVALS AND LISTING\n\n         The Company shall not be required to issue to an Optionee, Participant\nor a Beneficiary, as the case may be, any certificate for any shares of Common\nStock upon exercise of an option or for any Retention Shares granted under the\nPlan or to make any payment with respect to any Stock Unit granted under the\nPlan prior to (i) the obtaining of any approval from any governmental agency\nwhich the Company, in its sole discretion, shall determine to be necessary or\nadvisable, (ii) the admission of such shares to listing on any stock exchange on\nwhich the Common Stock may then be listed, and (iii) the completion of any\nregistration or other qualification of such shares or units under any state or\nfederal law or rulings or regulations of any governmental body which the\nCompany, in its sole discretion, shall determine to be necessary or advisable.\n\n13.      ADJUSTMENT IN EVENT OF CHANGES IN CAPITALIZATION\n\n         In the event of a recapitalization, stock split, stock dividend,\ncombination or exchange of shares, merger, consolidation, rights offering,\nseparation, spin-off, reorganization or liquidation, or any other change in the\ncorporate structure or shares of the Company, the Board, upon recommendation of\nthe Committee, may make such equitable adjustments as it may deem appropriate in\nthe number and kind of shares and Stock Units authorized by the Plan, in the\noption price of outstanding Options, and in the number and kind of shares, Stock\nUnits or other securities or property subject to Options or covered by\noutstanding Awards.\n\n14.      TERM OF THE PLAN\n\n         No Options, or Retention Shares or Stock Units shall be granted\npursuant to the Plan after April 16, 2003, but grants of Options, or Retention\nShares or Stock Units theretofore granted may extend beyond that date and the\nterms and conditions of the Plan shall continue to apply thereto.\n\n\n                                       14\n   16\n\n15.      TERMINATION OR AMENDMENT OF THE PLAN\n\n         The Board may at any time terminate the Plan with respect to any shares\nof Common Stock or Stock Units not at that time subject to outstanding Options\nor Awards, and may from time to time alter or amend the Plan or any part thereof\n(including, but without limiting the generality of the foregoing, any amendment\ndeemed necessary to ensure that the Company may obtain any approval referred to\nin Section 12 or to ensure that the grant of Options or Awards, the exercise of\nOptions, the payment of Retention Shares or the payment with respect to Stock\nUnits or any other provision of the Plan complies with Section 16(b) of the\nAct), provided that no change with respect to any Options, Retention Shares or\nStock Units theretofore granted may be made which would impair the rights of an\nOptionee or Participant without the consent of such Optionee or Participant and,\nfurther, that without the approval of stockholders, no alteration or amendment\nmay be made which would (i) increase the maximum number of shares of Common\nStock and Stock Units subject to the Plan as set forth in Section 5 (except by\noperation of Section 13), (ii) extend the term of the Plan or (iii) change the\nclass of eligible persons who may receive Options or Awards of Retention Shares\nor Stock Units under the Plan. The Committee may amend the Plan to extend the\nexercise period following an optionee's termination of an option granted prior\nto September 24, 1998, but not beyond: (i) in the case of a termination\nresulting from the disposition by the Company of all or a part of its interest\nin, or the discontinuance of the business of, a subsidiary, division or other\nbusiness unit of the Company, five years from the date of termination and (ii)\nin the case of all other terminations, not more than three years from the date\nof termination, or, if later, three years from the date the option becomes\nexercisable, but not more than five years after the date of such termination.\n\n16.      LEAVE OF ABSENCE\n\n         Unless the Committee shall determine otherwise, a leave of absence\nother than an Approved Leave of Absence shall be deemed a termination of\nemployment for purposes of the Plan. An Approved Leave of Absence shall not be\ndeemed a termination of employment for purposes of the Plan (except for purposes\nof Section 8), but the period of such Leave of Absence shall not be counted\ntoward satisfaction of any Restriction Period or Unit Restriction Period or any\nholding period described in Section 6(c).\n\n17.      GENERAL PROVISIONS\n\n         a. Neither the Plan nor the grant of any Option or Award nor any action\nby the Company, any Subsidiary or the Committee shall be held or construed to\nconfer upon any person any right to be continued in the employ of the Company or\na Subsidiary. The Company and each Subsidiary expressly reserve the right to\ndischarge, without liability but subject to his or her rights under the Plan,\nany Optionee or Participant whenever in the sole discretion of the Company or a\nSubsidiary, as the case may be, its interest may so require.\n\n         b. All questions pertaining to the construction, regulation, validity\nand effect of the Plan shall be determined in accordance with the laws of the\nState of Utah, without regard to conflict of laws doctrine.\n\n\n                                       15\n   17\n\n18.      EFFECTIVE DATE\n\n         The Plan shall become effective upon approval of the stockholders of\nthe Company.\n\n\n\n\n\n\n                                       16\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[9154],"corporate_contracts_industries":[9524],"corporate_contracts_types":[9539,9545],"class_list":["post-38207","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-union-pacific-corp","corporate_contracts_industries-transportation__railroads","corporate_contracts_types-compensation","corporate_contracts_types-compensation__esp"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/38207","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=38207"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=38207"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=38207"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=38207"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}