{"id":38431,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/2001-performance-incentive-plan-kraft-foods-inc.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"2001-performance-incentive-plan-kraft-foods-inc","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/2001-performance-incentive-plan-kraft-foods-inc.html","title":{"rendered":"2001 Performance Incentive Plan &#8211; Kraft Foods Inc."},"content":{"rendered":"<pre>\n                               KRAFT FOODS INC.\n\n                        2001 PERFORMANCE INCENTIVE PLAN\n\nSection 1.  Purpose; Definitions.\n\nThe purpose of the Plan is to support the Company's ongoing efforts to develop\nand retain world-class leaders and to provide the Company with the ability to\nprovide incentives more directly linked to the profitability of the Company's\nbusinesses and increases in shareholder value.\n\nFor purposes of the Plan, the following terms are defined as set forth below:\n\n   a.       \"Annual Incentive Award\" means an Incentive Award made pursuant to\n   Section 5(a)(v) with a Performance Cycle of one year or less.\n\n   b.       \"Awards\" mean grants under the Plan of Incentive Awards, Stock\n   Options, Stock Appreciation Rights, Restricted Stock or Other Stock-\n   Based Awards.\n\n   c.       \"Board\" means the Board of Directors of the Company.\n\n   d.       \"Code\" means the Internal Revenue Code of 1986, as amended from time\n   to time, and any successor thereto.\n\n   e.       \"Commission\" means the Securities and Exchange Commission or any\n   successor agency.\n\n   f.       \"Committee\" means the Compensation Committee of the Board or a\n   subcommittee thereof, any successor thereto or such other committee or\n   subcommittee as may be designated by the Board to administer the Plan.\n\n   g.       \"Common Stock\" or \"Stock\" means the Class A Common Stock of the\n   Company.\n\n   h.       \"Company\" means Kraft Foods Inc., a corporation organized under the\n   laws of the Commonwealth of Virginia, or any successor thereto.\n\n   i.       \"Economic Value Added\" means net after-tax operating profit less the\n   cost of capital.\n \n   j.       \"Exchange Act\" means the Securities Exchange Act of 1934, as amended\n   from time to time, and any successor thereto.\n\n   k.       \"Exercise Period\" means the 60-day period from and after a Change in\n   Control.\n\n   l.       \"Fair Market Value\" means, as of any given date, the mean between\n   the highest and lowest reported sales prices of the Common Stock on the New\n   York Stock Exchange-\n\n \n   Composite Transactions or, if no such sale of Common Stock is reported on\n   such date, the fair market value of the Stock as determined by the Committee\n   in good faith; provided, however, that the Committee may in its discretion\n   designate the actual sales price as Fair Market Value in the case of\n   dispositions of Common Stock under the Plan.\n\n   m.       \"Incentive Award\" means any Award that is either an Annual Incentive\n   Award or a Long-Term Incentive Award.\n\n   n.       \"Incentive Stock Option\" means any Stock Option that complies with\n   Section 422 (or any amended or successor provision) of the Code.\n\n   o.       \"Long-Term Incentive Award\" means an Incentive Award made pursuant\n   to Section 5(a)(v) with a Performance Cycle of more than one year.\n\n   p.       \"Nonqualified Stock Option\" means any Stock Option that is not an\n   Incentive Stock Option.\n\n   q.       \"Other Stock-Based Award\" means an Award made pursuant to Section\n   5(a)(iii).\n\n   r.       \"Performance Cycle\" means the period selected by the Committee\n   during which the performance of the Company or any subsidiary, affiliate or\n   unit thereof or any individual is measured for the purpose of determining the\n   extent to which an Award subject to Performance Goals has been earned.\n\n   s.       \"Performance Goals\" mean the objectives for the Company or any\n   subsidiary or affiliate or any unit thereof or any individual that may be\n   established by the Committee for a Performance Cycle with respect to any\n   performance-based Awards contingently awarded under the Plan. Performance\n   Goals may be provided in absolute terms, or in relation to the Company's peer\n   group. The Company's peer group will be determined by the Committee, in its\n   sole discretion. The Performance Goals for Awards that are intended to\n   constitute \"performance-based\" compensation within the meaning of Section\n   162(m) (or any amended or successor provision) of the Code shall be based on\n   one or more of the following criteria: earnings per share, total shareholder\n   return, return on equity, return on capital, net income, cash flow, operating\n   income or Economic Value Added.\n\n   t.       \"Plan\" means this Kraft Foods Inc. 2001 Performance Incentive Plan,\n   as amended from time to time.\n\n   u.       \"Restricted Period\" means the period during which an Award may not\n   be sold, assigned, transferred, pledged or otherwise encumbered.\n\n   v.       \"Restricted Stock\" means an Award of shares of Common Stock pursuant\n   to Section 5(a)(iv).\n\n                                       2\n\n \n    w.      \"Spread Value\" means, with respect to a share of Common Stock\n    subject to an Award, an amount equal to the excess of the Fair Market Value,\n    on the date such value is determined, over the Award's exercise or grant\n    price, if any.\n\n    x.      \"Stock Appreciation Right\" or \"SAR\" means a right granted pursuant\n    to Section 5(a)(ii).\n\n    y.      \"Stock Option\" means an Incentive Stock Option or a Nonqualified\n    Stock Option granted pursuant to Section 5(a)(i).\n\nIn addition, the terms \"Business Combination,\" \"Change in Control,\" \"Change in\nControl Price,\" \"Incumbent Board,\" \"Outstanding Company Stock,\" \"Outstanding\nCompany Voting Securities\" and \"Person\" have the meanings set forth in Section\n6.\n\nSection 2.  Administration.\n\nThe Plan shall be administered by the Committee, which shall have the power to\ninterpret the Plan and to adopt such rules and guidelines for carrying out the\nPlan as it may deem appropriate. The Committee shall have the authority to adopt\nsuch modifications, procedures and subplans as may be necessary or desirable to\ncomply with the laws, regulations, compensation practices and tax and accounting\nprinciples of the countries in which the Company, a subsidiary or an affiliate\nmay operate to assure the viability of the benefits of Awards made to\nindividuals employed in such countries and to meet the objectives of the Plan.\n\nSubject to the terms of the Plan, the Committee shall have the authority to\ndetermine those employees eligible to receive Awards and the amount, type and\nterms of each Award and to establish and administer any Performance Goals\napplicable to such Awards. The Committee may delegate its authority and power\nunder the Plan to one or more officers of the Company, subject to guidelines\nprescribed by the Committee, but only with respect to participants who are not\nsubject to either Section 16 (or any amended or successor provision) of the\nExchange Act or Section 162(m) (or any amended or successor provision) of the\nCode.\n\nAny determination made by the Committee or by one or more officers pursuant to\ndelegated authority in accordance with the provisions of the Plan with respect\nto any Award shall be made in the sole discretion of the Committee or such\ndelegate, and all decisions made by the Committee or any appropriately\ndesignated officer pursuant to the provisions of the Plan shall be final and\nbinding on all persons, including the Company and Plan participants.\n\nSection 3.  Eligibility.\n\nSalaried employees of the Company, its subsidiaries and affiliates who are\nresponsible for or contribute to the management, growth and profitability of the\nbusiness of the Company, its subsidiaries or its affiliates, are eligible to be\ngranted Awards under the Plan; provided that employees of Philip Morris\n                               -------- ----\nCompanies Inc. and its subsidiaries other than the Company and the Company's\nsubsidiaries are not eligible to be granted Awards under the Plan.\n\n\n                                       3\n\n \nSection 4.  Common Stock Subject to the Plan.\n\nThe total number of shares of Common Stock reserved and available for\ndistribution pursuant to the Plan shall be 75,000,000 shares. If any Award under\nthe Plan is exercised or cashed out or terminates or expires or is forfeited\nwithout a payment being made to the participant in the form of Common Stock, the\nshares subject to such Award, if any, shall again be available for distribution\nin connection with Awards under the Plan; provided, however, that any shares\nwhich are available again for Awards under the Plan also shall count against the\nlimit described in Section 5(b)(i). Any shares of Common Stock that are used by\na participant as full or partial payment of withholding or other taxes or as\npayment for the exercise or conversion price of an Award under the Plan shall be\navailable for distribution in connection with Awards under the Plan.\n\nIn the event of any merger, share exchange, reorganization, consolidation,\nrecapitalization, reclassification, distribution, stock dividend, stock split,\nreverse stock split, split-up, spin-off, issuance of rights or warrants or other\nsimilar transaction or event affecting the Common Stock after adoption of the\nPlan by the Board, the Board is authorized, to the extent it deems appropriate,\nto make substitutions or adjustments in the aggregate number and kind of shares\nof Common Stock reserved for issuance under the Plan, in the number, kind and\nprice of shares of Common Stock subject to outstanding Awards and in the Award\nlimits set forth in Section 5 (or to make provision for cash payments to the\nholders of Awards).\n\nThe Committee may make an Award in substitution for incentive awards, stock\nawards, stock options or similar awards held by an individual who becomes an\nemployee of the Company, a subsidiary or an affiliate in connection with a\ntransaction described in the second paragraph of this Section 4. Notwithstanding\nany provision of the Plan (other than the limitation set forth in the first\nparagraph of this Section 4), the terms of such substituted Awards shall be as\nthe Committee, in its discretion, determines is appropriate.\n\nSection 5.  Awards.\n\n(a)    General.  The types of Awards that may be granted under the Plan are set\nforth below. Awards may be granted singly, in combination or in tandem with\nother Awards.\n\n       (i)    Stock Options. A Stock Option represents the right to purchase a\n       share of Stock at a predetermined grant price. Stock Options granted\n       under the Plan may be in the form of Incentive Stock Options or\n       Nonqualified Stock Options, as specified in the Award agreement but no\n       Stock Option designated as an Incentive Stock Option shall be invalid in\n       the event that it fails to qualify as an Incentive Stock Option. The term\n       of each Stock Option shall be set forth in the Award agreement, but no\n       Stock Option shall be exercisable more than ten years after the grant\n       date. The grant price per share of Common Stock purchasable under a Stock\n       Option shall not be less than 100% of the Fair Market Value on the date\n       of grant. Subject to the applicable Award agreement, Stock Options may be\n       exercised, in whole or in part, by giving written notice of exercise\n       specifying the number of shares to be purchased. Such notice shall be\n       accompanied by \n\n                                       4\n\n         payment in full of the purchase price by certified or bank check or\n         such other instrument as the Company may accept (including a copy of\n         instructions to a broker or bank acceptable to the Company to deliver\n         promptly to the Company an amount of sale or loan proceeds sufficient\n         to pay the purchase price). As determined by the Committee, payment in\n         full or in part may also be made in the form of Common Stock already\n         owned by the optionee valued at Fair Market Value on the day preceding\n         the date of exercise; provided, however, that such Common Stock shall\n         not have been acquired by the optionee within the preceding six months.\n\n         (ii)   Stock Appreciation Rights. An SAR represents the right to\n         receive a payment, in cash, shares of Common Stock, or both (as\n         determined by the Committee), with a value equal to the Spread Value on\n         the date the SAR is exercised. The grant price of an SAR shall be set\n         forth in the applicable Award agreement and shall not be less than 100%\n         of the Fair Market Value on the date of grant. Subject to the terms of\n         the applicable Award agreement, an SAR shall be exercisable, in whole\n         or in part, by giving written notice of exercise.\n\n         (iii)  Other Stock-Based Awards. Other Stock-Based Awards are Awards,\n         other than Stock Options, SARs or Restricted Stock, that are\n         denominated in, valued in whole or in part by reference to, or\n         otherwise based on or related to, Common Stock. The grant, purchase,\n         exercise, exchange or conversion of Other Stock-Based Awards granted\n         under this subsection (iii) shall be on such terms and conditions and\n         by such methods as shall be specified by the Committee. Where the value\n         of an Other Stock-Based Award is based on the Spread Value, the grant\n         price for such an Award will not be less than 100% of the Fair Market\n         Value on the date of grant.\n\n         (iv)   Restricted Stock. Shares of Restricted Stock are shares of\n         Common Stock that are awarded to a participant and that during the\n         Restricted Period may be forfeitable to the Company upon such\n         conditions as may be set forth in the applicable Award agreement.\n         Restricted Stock may not be sold, assigned, transferred, pledged or\n         otherwise encumbered during the Restricted Period. Except as provided\n         in the applicable Award agreement, a participant shall have with\n         respect to such Restricted Stock all the rights of a holder of Common\n         Stock during the Restricted Period.\n\n         (v)    Incentive Awards. Incentive Awards are performance-based Awards\n         that are expressed in U.S. currency or Common Stock or any combination\n         thereof. Incentive Awards shall either be Annual Incentive Awards or\n         Long-Term Incentive Awards.\n\n(b)      Maximum Awards. Subject to the exercise of the Board's authority\npursuant to Section 4:\n\n         (i)    The total number of shares of Common Stock subject to Stock\n         Options and Stock Appreciation Rights awarded during any calendar year\n         to any participant shall not exceed 7,500,000 shares.\n\n                                       5\n\n \n         (ii)   The total amount of any Annual Incentive Award awarded to any\n         participant with respect to any Performance Cycle shall not exceed\n         $7,500,000.\n\n         (iii)  The total amount of any Long-Term Incentive Award awarded to any\n         Participant with respect to any Performance Cycle shall not exceed\n         150,000 shares of Common Stock multiplied by the number of years in the\n         Performance Cycle or, in the case of awards expressed in currency,\n         $4,500,000 multiplied by the number of years in the Performance Cycle.\n\n         (iv)   An amount not in excess of 18,800,000 shares of Common Stock may\n         be issued pursuant to Restricted Stock Awards, Other Stock-Based\n         Awards, and Incentive Awards, except that Other Stock-Based Awards with\n         values based on Spread Values shall not be included in this limitation.\n\n(c)      Performance-Based Awards. Any Awards granted pursuant to the Plan may\nbe in the form of performance-based Awards through the application of\nPerformance Goals and Performance Cycles.\n\nSection 6.      Change in Control Provisions.\n\n(a)      Impact of Event. Notwithstanding any other provision of the Plan to the\ncontrary, in the event of a Change in Control:\n\n         (i)    All Stock Options and Stock Appreciation Rights outstanding as\n         of the date such Change in Control occurs shall become fully vested and\n         exercisable.\n\n         (ii)   The restrictions and other conditions applicable to any\n         Restricted Stock or Other Stock-Based Awards, including vesting\n         requirements, shall lapse, and such Awards shall become free of all\n         restrictions and fully vested.\n\n         (iii)  The value of all outstanding Stock Options, Stock Appreciation\n         Rights, Restricted Stock and Other Stock-Based Awards shall, unless\n         otherwise determined by the Committee at or after grant, be cashed out\n         on the basis of the \"Change in Control Price,\" as defined in Section\n         6(c), as of the date such Change in Control occurs or such other date\n         as the Committee may determine prior to the Change in Control.\n\n         (iv)   Any Incentive Awards relating to Performance Cycles prior to the\n         Performance Cycle in which the Change in Control occurs that have been\n         earned but not paid shall become immediately payable in cash. In\n         addition, each participant who has been awarded an Incentive Award\n         shall be deemed to have earned a pro rata Incentive Award equal to the\n         product of (A) such participant's maximum award opportunity for such\n         Performance Cycle, and (B) a fraction, the numerator of which is the\n         number of full or partial months that have elapsed since the beginning\n         of such Performance Cycle to the date on which the Change in Control\n         occurs, and the denominator of which is the total number of months in\n         such Performance Cycle.\n\n                                       6\n\n \n(b)      Definition of Change in Control. A \"Change in Control\" means the\nhappening of any of the following events:\n\n         (i)    Approval by the shareholders of the Company of a reorganization,\n         merger, share exchange or consolidation (a \"Business Combination\"),\n         unless in each case following such Business Combination, (A) all or\n         substantially all of the individuals and entities who were the\n         beneficial owners of the then outstanding voting securities of the\n         Company entitled to vote generally in the election of directors (the\n         \"Outstanding Company Voting Securities\") immediately prior to such\n         Business Combination beneficially own (within the meaning of Rule 13d-3\n         promulgated under the Exchange Act), directly or indirectly, more than\n         50% of, respectively, the outstanding shares of common stock and the\n         combined voting power of the then outstanding voting securities\n         entitled to vote generally in the election of directors of the\n         corporation resulting from such Business Combination (including,\n         without limitation, a corporation that as a result of such transaction\n         owns the Company through one or more subsidiaries) in substantially the\n         same proportions as their ownership, immediately prior to such Business\n         Combination of the Outstanding Company Voting Securities, (B) no\n         individual, entity or group (within the meaning of Section 13(d)(3) or\n         14(d)(2) of the Exchange Act (a \"Person\") (excluding Philip Morris\n         Companies Inc., any employee benefit plan (or related trust) sponsored\n         or maintained by the Company, Philip Morris Companies Inc. or such\n         corporation resulting from such Business Combination) beneficially\n         owns, directly or indirectly, 20% or more of, respectively, the\n         outstanding shares of common stock and the combined voting power of the\n         then outstanding voting securities of such corporation except to the\n         extent that such Person owned 20% or more of the Outstanding Company\n         Voting Securities prior to the Business Combination and (C) at least a\n         majority of the members of the board of directors of the corporation\n         resulting from such Business Combination were members of the Incumbent\n         Board at the time of the execution of the initial agreement, or of the\n         action of the Board, providing for such Business Combination; or\n\n         (ii)   Approval by the shareholders of the Company of (A) a complete\n         liquidation or dissolution of the Company or (B) the sale or other\n         disposition of all or substantially all of the assets of the Company,\n         other than to a corporation with respect to which, following such sale\n         or other disposition, (1) more than 50% of, respectively, the\n         outstanding shares of common stock and the combined voting power of the\n         then outstanding voting securities of such corporation entitled to vote\n         generally in the election of directors is then beneficially owned,\n         directly or indirectly, by all or substantially all of the individuals\n         and entities who were the beneficial owners of the Outstanding Company\n         Voting Securities immediately prior to such sale or other disposition\n         in substantially the same proportion as their ownership, immediately\n         prior to such sale or other disposition, of the Outstanding Company\n         Voting Securities, as the case may be, (2) less than 20% of,\n         respectively, the outstanding shares of common stock and the combined\n         voting power of the then outstanding voting securities of such\n         corporation entitled to vote generally in the election of directors is\n         then beneficially owned, directly or indirectly, by any Person\n         (excluding Philip Morris Companies Inc., any employee benefit plan (or\n         related trust) sponsored or \n\n                                       7\n\n         maintained by the Company, Philip Morris\n         Companies Inc. or such corporation), except to the extent that such\n         Person owned 20% or more of the Outstanding Company Voting Securities\n         prior to the sale or disposition and (3) at least a majority of the\n         members of the board of directors of such corporation were members of\n         the Incumbent Board at the time of the execution of the initial\n         agreement, or of the action of the Board, providing for such sale or\n         other disposition of assets of the Company; or\n\n         (iii)  The sale or other disposition for fair value of securities of\n         the Company by Philip Morris Companies Inc. if, after such sale or\n         other disposition for value Philip Morris Companies Inc. holds less\n         than 50% of the combined voting power of the Outstanding Company Voting\n         Securities; or\n\n         (iv)   If Philip Morris Companies Inc. holds less than 50% of the\n         combined voting power of the Outstanding Company Voting Securities by\n         virtue of a transaction that does not constitute a Change in Control\n         within the meaning of paragraph (iii) above, the acquisition by any\n         Person of beneficial ownership of 20% or more of the Outstanding\n         Company Voting Securities; provided, however, that the following\n         acquisitions shall not constitute a Change in Control: (1) any\n         acquisition by such Person directly from the Company, (2) any\n         acquisition by the Company, (3) any acquisition by any employee benefit\n         plan (or related trust) sponsored or maintained by the Company, Philip\n         Morris Companies Inc. or any entity controlled by the Company or (4)\n         any acquisition by any corporation pursuant to a transaction described\n         in clauses (A), (B) and (C) of paragraph (i) of this Section 6(b); or\n\n         (v)    If Philip Morris Companies Inc. holds less than 50% of the\n         combined voting power of the Outstanding Company Voting Securities by\n         virtue of a transaction that does not constitute a Change in Control\n         within the meaning of paragraph (iii) above, the individuals who\n         constitute the Incumbent Board cease for any reason to constitute at\n         least a majority of the Board.\n\n(c)      Change in Control Price. \"Change in Control Price\" means the highest\nprice per share paid in any transaction reported on the New York Stock Exchange-\nComposite Transactions or paid or offered in any bona fide transaction related\nto a potential or actual change in control of the Company at any time during the\npreceding 60-day period as determined by the Committee, except that, in the case\nof Incentive Stock Options, such price shall be based only on transactions\nreported for the date on which such Incentive Stock Options are cashed out.\n\n(d)      Incumbent Board. \"Incumbent Board\" means the members of the Board as of\nthe effective date of the Plan. Notwithstanding the preceding sentence, any\nindividual who becomes a member of the Board after such effective date whose\nelection, or nomination for election by the shareholders of the Company, was\napproved by a vote of at least a majority of the directors then comprising the\nIncumbent Board shall be considered as though such member were a member of the\nIncumbent Board, but excluding, for this purpose, any such individual whose\ninitial assumption of office occurs as a result of an actual or threatened\nelection contest with respect to\n\n                                       8\n\n\nthe election or removal of directors or other actual or threatened solicitation \nof proxies or consents by or on behalf of a Person other than the Board.\n\n(e)      Notwithstanding any other provision of the Plan, upon a Change in\nControl, unless the Committee shall determine otherwise at grant, an Award\nrecipient shall have the right, by giving notice to the Company within the\nExercise Period, to elect to surrender all or part of the Stock Option, SAR,\nRestricted Stock or Other Stock-Based Award to the Company and to receive in\ncash, within 30 days of such notice, an amount equal to the amount by which the\n\"Change in Control Price\" on the date of such notice shall exceed the exercise\nor grant price under such Award, multiplied by the number of shares of Stock as\nto which the right granted under this Section 6 shall have been exercised.\n\nSection 7.  Plan Amendment and Termination.\n\nThe Board may amend or terminate the Plan at any time, provided that no such\namendment shall be made without shareholder approval if such approval is\nrequired under applicable law, or if such amendment would: (i) decrease the\ngrant or exercise price of any Stock Option, SAR or Other Stock-Based Award to\nless than the Fair Market Value on the date of grant; or (ii) increase the total\nnumber of shares of Common Stock that may be distributed under the Plan. Except\nas may be necessary to comply with a change in the laws, regulations or\naccounting principles of a foreign country applicable to participants subject to\nthe laws of such foreign country, the Committee may not cancel any option and\nsubstitute therefor a new option with a lower option price. Except as set forth\nin any Award agreement, no amendment or termination of the Plan may materially\nand adversely affect any outstanding Award under the Plan without the Award\nrecipient's consent.\n\nSection 8.  Payments and Payment Deferrals.\n\nPayment of Awards may be in the form of cash, Stock, other Awards or\ncombinations thereof as the Committee shall determine, and with such\nrestrictions as it may impose. The Committee, either at the time of grant or by\nsubsequent amendment, may require or permit deferral of the payment of Awards\nunder such rules and procedures as it may establish. It also may provide that\ndeferred settlements include the payment or crediting of interest or other\nearnings on the deferred amounts, or the payment or crediting of dividend\nequivalents where the deferred amounts are denominated in Common Stock\nequivalents.\n\nSection 9.  Dividends and Dividend Equivalents.\n\nThe Committee may provide that any Awards under the Plan earn dividends or\ndividend equivalents. Such dividends or dividend equivalents may be paid\ncurrently or may be credited to a participant's Plan account. Any crediting of\ndividends or dividend equivalents may be subject to such restrictions and\nconditions as the Committee may establish, including reinvestment in additional\nshares of Common Stock or Common Stock equivalents.\n\n\n                                       9\n\nSection 10. Transferability.\n\nUnless otherwise required by law, Awards shall not be transferable or assignable\nother than by will or the laws of descent and distribution.\n \nSection 11.  Award Agreements.\n\nEach Award under the Plan shall be evidenced by a written agreement (which need\nnot be signed by the recipient unless otherwise specified by the Committee) that\nsets forth the terms, conditions and limitations for each Award. Such terms may\ninclude, but are not limited to, the term of the Award, vesting and forfeiture\nprovisions, and the provisions applicable in the event the recipient's\nemployment terminates. The Committee may amend an Award agreement, provided that\nno such amendment may materially and adversely affect an Award without the Award\nrecipient's consent.\n\nSection 12.  Unfunded Status Plan.\n\nIt is presently intended that the Plan constitute an \"unfunded\" plan for\nincentive and deferred compensation. The Committee may authorize the creation of\ntrusts or other arrangements to meet the obligations created under the Plan to\ndeliver Common Stock or make payments; provided, however, that, unless the\nCommittee otherwise determines, the existence of such trusts or other\narrangements is consistent with the \"unfunded\" status of the Plan.\n\nSection 13.  General Provisions.\n\n(a)     The Committee may require each person acquiring shares of Common Stock\npursuant to an Award to represent to and agree with the Company in writing that\nsuch person is acquiring the shares without a view to the distribution thereof.\nThe certificates for such shares may include any legend that the Committee deems\nappropriate to reflect any restrictions on transfer.\n\nAll certificates for shares of Common Stock or other securities delivered under\nthe Plan shall be subject to such stock transfer orders and other restrictions\nas the Committee may deem advisable under the rules, regulations and other\nrequirements of the Commission, any stock exchange upon which the Common Stock\nis then listed, and any applicable Federal, state or foreign securities law, and\nthe Committee may cause a legend or legends to be put on any such certificates\nto make appropriate reference to such restrictions.\n\n(b)     Nothing contained in the Plan shall prevent the Company, a subsidiary or\nan affiliate from adopting other or additional compensation arrangements for\ntheir respective employees.\n\n(c)     Neither the adoption of the Plan nor the granting of Awards under the\nPlan shall confer upon any employee any right to continued employment nor shall\nthey interfere in any way with the right of the Company, a subsidiary or an\naffiliate to terminate the employment of any employee at any time.\n\n\n\n                                      10\n\n(d)     No later than the date as of which an amount first becomes includible in\nthe gross income of the participant for income tax purposes with respect to any\nAward under the Plan, the participant shall pay to the Company, or make\narrangements satisfactory to the Company regarding the payment of, any Federal,\nstate, local or foreign taxes of any kind which are required by law or\napplicable regulation to be withheld with respect to such amount. Unless\notherwise determined by the Committee, withholding obligations arising from an\nAward may be settled with\n \nCommon Stock, including Common Stock that is part of, or is received upon\nexercise or conversion of, the Award that gives rise to the withholding\nrequirement. The obligations of the Company under the Plan shall be conditional\non such payment or arrangements, and the Company, its subsidiaries and its\naffiliates shall, to the extent permitted by law, have the right to deduct any\nsuch taxes from any payment otherwise due to the participant. The Committee may\nestablish such procedures as it deems appropriate, including the making of\nirrevocable elections, for the settling of withholding obligations with Common\nStock.\n\n(e)     The Plan and all Awards made and actions taken thereunder shall be\ngoverned by and construed in accordance with the laws of the Commonwealth of\nVirginia.\n\n(f)     If any provision of the Plan is held invalid or unenforceable, the\ninvalidity or unenforceability shall not affect the remaining parts of the Plan,\nand the Plan shall be enforced and construed as if such provision had not been\nincluded.\n\n(g)     The Plan shall be effective upon approval by Philip Morris Companies\nInc. in its capacity as the Company's sole shareholder. Except as otherwise\nprovided by the Board, no Awards shall be made after June 11, 2006, provided\nthat any awards granted prior to that date may extend beyond it.\n\n                                      11\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8003],"corporate_contracts_industries":[9424],"corporate_contracts_types":[9539,9546],"class_list":["post-38431","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-kraft-foods-inc","corporate_contracts_industries-food__diversified","corporate_contracts_types-compensation","corporate_contracts_types-compensation__incentive"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/38431","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=38431"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=38431"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=38431"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=38431"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}