{"id":38539,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/award-agreement-for-stock-options-alcoa.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"award-agreement-for-stock-options-alcoa","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/compensation\/award-agreement-for-stock-options-alcoa.html","title":{"rendered":"Award Agreement for Stock Options – Alcoa"},"content":{"rendered":"

ALCOA INC. <\/strong><\/p>\n

STOCK OPTION AWARD CERTIFICATE <\/strong><\/p>\n

Alcoa Inc. (the “Company”) has on [DATE] granted to<\/p>\n<\/p>\n\n\n\n\n\n
<\/td>\n<\/td>\n<\/td>\n<\/tr>\n
\n

[NAME]<\/p>\n<\/td>\n

<\/td>\n\n

[EMPLOYEE ID NUMBER]<\/p>\n<\/td>\n<\/tr>\n

\n

(Name)<\/p>\n<\/td>\n

<\/td>\n\n

(EMPLOYEE ID)<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

(“Participant”), the option to purchase [NUMBER] shares of common stock of
\nthe Company at the option grant price of $[ ] per share, based upon
\nthe following terms:<\/p>\n<\/p>\n\n\n\n
\n

1.<\/p>\n<\/td>\n

\n

This Stock Option Award is granted under the provisions of the 2009 Alcoa
\nStock Incentive Plan, as last amended prior to the date above (the “Plan”), and
\nis subject to the provisions of the Plan and the applicable Terms and Conditions
\nfor the grant (the “Governing Documents”).<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
\n

2.<\/p>\n<\/td>\n

\n

This Stock Option Award vests on [DATE or DATES], if the Participant is still
\nan active employee of the Company or any of its controlled subsidiaries or
\naffiliates, subject to the further provisions set forth in the Governing
\nDocuments.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
\n

3.<\/p>\n<\/td>\n

\n

This stock option grant expires ten years after the date of the grant, unless
\nearlier terminated under the terms of the Governing Documents.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/p>\n

\n

ALCOA INC. <\/strong><\/p>\n

TERMS AND CONDITIONS FOR STOCK OPTION AWARDS <\/strong>\n<\/p>\n

Effective January 1, 2010 <\/strong><\/p>\n

These terms and conditions are authorized by the Compensation and Benefits
\nCommittee of the Board of Directors. They are deemed to be incorporated into and
\nform a part of every stock option awarded under the 2009 Alcoa Stock Incentive
\nPlan, as last amended prior to the grant (the “Plan”) on or after January 1,
\n2010, unless the Award certificate provides otherwise.<\/p>\n

Terms that are defined in the Plan have the same meanings in these terms and
\nconditions, except that Alcoa or Company means Alcoa Inc. or any of its
\ncontrolled subsidiaries or affiliates.<\/p>\n

General Terms and Conditions <\/em><\/strong><\/p>\n

1. Stock Option awards are subject to the terms and conditions set forth in
\nthe Award certificate, the provisions of the Plan and the provisions of these
\nterms and conditions.<\/p>\n

2. The grant price of a stock option is 100% of the Fair Market Value per
\nShare on the date of grant, unless the Award certificate specifies a higher
\ngrant price.<\/p>\n

3. “Fair Market Value” per Share on any given date is the closing price per
\nShare on that date as reported on the New York Stock Exchange or other stock
\nexchange on which the Shares principally trade. If the New York Stock Exchange
\nor such other exchange is not open for business on the date Fair Market Value is
\nbeing determined, the closing price as reported for the next business day on
\nwhich that exchange is open for business will be used.<\/p>\n

4. The expiration date of a Stock Option is ten years after the date of
\ngrant, unless the Committee establishes a different expiration date in
\naccordance with the Plan.<\/p>\n

Vesting and Exercisability <\/em><\/strong><\/p>\n

5. Stock Options vest as to one-third of the Award on the first anniversary
\nof the grant date, as to one-third of the Award on the second anniversary of the
\ngrant date and as to one-third of the Award on the third anniversary of the
\ngrant date, unless the Committee establishes another date for vesting with
\nrespect to all or a portion of the Award, in accordance with the Plan.<\/p>\n

6. Except as provided in paragraph 8, once vested, a Stock Option may be
\nexercised until its expiration date, as long as the Participant remains an
\nactive employee of the Company.<\/p>\n

7. Except as provided in paragraph 8:<\/p>\n<\/p>\n\n\n\n
<\/td>\n\n<\/td>\n<\/td>\n\n

as a condition to exercise of a Stock Option, a Participant must
\nremain an Alcoa employee actively at work until the date the option vests, and
\nif a Stock Option vests as to some but not all Shares covered by the Award, the
\nParticipant must be an active employee on the date the relevant portion of the
\nAward vests; and<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

1<\/p>\n<\/p>\n

\n\n\n\n
<\/td>\n\n<\/td>\n<\/td>\n\n

if the Participant’s employment with Alcoa terminates prior to
\nthe vesting date of the Stock Option (or relevant option portion), the Stock
\nOption (or relevant option portion) is forfeited and is automatically canceled.\n<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

8. The following are exceptions to the vesting and exercisability rules:<\/p>\n<\/p>\n\n\n\n
<\/td>\n\n<\/td>\n<\/td>\n\n

Death<\/u>: a Stock Option held by a Participant who dies
\nwhile an employee vests immediately but must be exercised by a legal
\nrepresentative or beneficiary on the earlier of five years from the date of
\ndeath or the original expiration date of the Stock Option.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
<\/td>\n\n<\/td>\n<\/td>\n\n

Change in Control<\/u>: a Stock Option vests and becomes
\nexercisable immediately upon certain Change in Control events described in the
\nPlan.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
<\/td>\n\n<\/td>\n<\/td>\n\n

Retirement<\/u>: a Stock Option held by a Participant who
\nretires at least 6 months after the grant date under a Company or government
\nretirement plan in which the Participant is eligible for an immediate payment of
\na retirement benefit, is not forfeited. Any unvested portion of the Stock Option
\nvests in accordance with the original vesting schedule of the grant and any
\nvested portion of the Stock Option will remain exercisable until the original
\nexpiration date of the Stock Option.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
<\/td>\n\n<\/td>\n<\/td>\n\n

Divestiture<\/u>: if a Stock Option is held by a Participant
\nidentified by the Company to be terminated from employment with the Company as a
\nresult of a divestiture of a business or a portion of a business of the Company
\nand the Participant either becomes an employee of (or is leased or seconded to)
\nthe entity acquiring the business on the date of the closing, or the Participant
\nis not offered employment with the entity acquiring the business and is
\nterminated by the Company within 90 days of the closing of the sale, then, at
\nthe discretion of the Chief Executive Officer of Alcoa Inc.:<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
<\/td>\n\n

o<\/p>\n<\/td>\n

\n

Any unvested portion of the Stock Option will continue to vest under the
\noriginal vesting schedule and once vested, will be exercisable on the earlier of
\nthe original expiration date of the Stock Option or two years from the date the
\nParticipant’s employment with the Company has been terminated; and<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
<\/td>\n\n

o<\/p>\n<\/td>\n

\n

Any vested portion of the Stock Option will remain exercisable on the earlier
\nof the original expiration date of the Stock Option or two years from the date
\nthe Participant’s employment with the Company has been terminated.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

For purposes of this paragraph, employment by “the entity acquiring the
\nbusiness” includes employment by a subsidiary or affiliate of the entity
\nacquiring the business; and “divestiture of a business” means the sale of assets
\nor stock resulting in the sale of a going concern. “Divestiture of a business”
\ndoes not include a plant shut down or other termination of a business.<\/p>\n<\/p>\n\n\n\n
<\/td>\n\n<\/td>\n<\/td>\n\n

Termination of Employment<\/u>: A Stock Option held by a
\nParticipant whose employment with the Company is terminated for any reason other
\nthan those<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

2<\/p>\n<\/p>\n

\n

described above in this paragraph 8, any unvested Stock Options will be
\nforfeited on the date of termination of employment and any vested Stock Options
\nwill remain exercisable for 90 days after the date employment is terminated.\n<\/p>\n

Option Exercise and Payment of Exercise Price
\n<\/em><\/strong><\/p>\n

9. A vested, exercisable option is exercised when a signed notification of
\nexercise is received by the Plan administrator.<\/p>\n

10. Payment in full of the purchase price of a Stock Option is due on the
\nexercise date. Payment of the option purchase price may be made:<\/p>\n<\/p>\n\n\n\n
<\/td>\n\n<\/td>\n<\/td>\n\n

in cash (including a “broker-assisted cashless exercise”
\ndescribed in the next paragraph); or<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
<\/td>\n\n<\/td>\n<\/td>\n\n

by the delivery or presentation to the Company of Shares that
\nhave been owned by the Participant for the Minimum Holding Period (as defined
\nbelow) and that have an aggregate Fair Market Value on the date of exercise,
\nwhich, together with any cash payment, equals or exceeds the Stock Option
\npurchase price.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

9. A Participant may elect to pay the cash purchase price of the option
\nthrough a “broker-assisted cashless exercise,” using a broker reasonably
\nacceptable to the Company. On or prior to the exercise date, the Participant
\nmust deliver to the Company the Participant’s instruction directing and
\nobligating the broker to (a) sell Shares (or a sufficient portion of the Shares)
\nacquired upon exercise of the option and (b) remit to the Company a sufficient
\nportion of the sale proceeds to pay the entire purchase price and any tax
\nwithholding resulting from the exercise. Such proceeds are due not later than
\nthe third trading day after the exercise date.<\/p>\n

10. Shares owned by a Participant include (a) those registered in the
\nParticipant’s name (or registered jointly with another person), (b) those held
\nin a brokerage account owned by the Participant individually or jointly with
\nanother person, and (c) those held in a trust, partnership, limited partnership
\nor other entity for the benefit of the Participant individually (or for the
\nbenefit of the Participant jointly with another person). Notwithstanding the
\nforegoing, Shares owned by a Participant do not include Shares held in any
\nqualified plan, IRA or similar tax deferred arrangement or Shares that are
\notherwise subject to potential accounting limitations regarding their use in
\nstock swap transactions. The Company may require verification or proof of
\nownership or length of ownership of any shares delivered in payment of the
\npurchase price of an option.<\/p>\n

11. The term “Minimum Holding Period” means 6 months or such other period, if
\nany, as qualifies as the measurement period for “mature shares” under applicable
\ngenerally accepted accounting principles. In calculating the number of shares
\navailable for delivery to pay the purchase price of an option, shares acquired
\nupon exercise of a stock option (including any shares delivered or exchanged to
\npay the purchase price thereof or withholding taxes thereon) shall be
\ndisregarded until expiration of the Minimum Holding Period after exercise.<\/p>\n<\/p>\n

3<\/p>\n<\/p>\n

\n

Taxes <\/strong><\/p>\n

12. All taxes required to be withheld under applicable tax laws in connection
\nwith a Participant’s receipt of Shares upon exercise of a Stock Option must be
\npaid over by the Participant, in cash, immediately upon advice, unless the
\nParticipant complies with the following paragraphs regarding payment using
\nShares.<\/p>\n

13. A Participant may satisfy his or her obligation to pay required
\nwithholding taxes due upon such exercise by having Alcoa withhold from the
\nShares to be issued upon the exercise that number of Shares with a Fair Market
\nValue on the exercise date equal to the withholding amount to be paid.
\nWithholding taxes in the United States include applicable income taxes, federal
\nand state unemployment compensation taxes and FICA\/FUTA taxes.<\/p>\n

14. The amount of taxes that may be paid by a Participant using Shares
\nretained from the Stock Option exercise will be determined by applying the
\nminimum rates required by applicable tax regulations.<\/p>\n

15. The election to use Shares to satisfy a Participant’s withholding
\nobligation must be made, in writing, not later than at the time of exercise of
\nthe stock option.<\/p>\n

Beneficiaries <\/em><\/strong><\/p>\n

16. Participants will be entitled to designate one or more beneficiaries to
\nreceive all Stock Options that are unexercised at the time of the Participant’s
\ndeath. All beneficiary designations will be on a beneficiary designation form
\napproved for the Plan. Copies of the form are available from the Plan
\nadministrator.<\/p>\n

17. Beneficiary designations on an approved form will be effective at the
\ntime received by the Plan administrator. A Participant may revoke a beneficiary
\ndesignation at any time by written notice to the Plan administrator or by filing
\na new designation form. Any designation form previously filed by a Participant
\nwill be automatically revoked and superseded by a later-filed form.<\/p>\n

18. A Participant will be entitled to designate any number of beneficiaries
\non the form, and the beneficiaries may be natural or corporate persons.<\/p>\n

19. The failure of any Participant to obtain any recommended signature on the
\nform will not invalidate the beneficiary designation or prohibit Alcoa from
\ntreating such designation as valid and effective. No beneficiary will acquire
\nany beneficial or other interest in any Stock Option prior to the death of the
\nParticipant who designated such beneficiary.<\/p>\n

20. Unless the Participant indicates on the form that a named beneficiary is
\nto receive unexercised options only upon the prior death of another named
\nbeneficiary, all beneficiaries designated on the form will be entitled and
\nrequired to join in the exercise of the option. Unless otherwise indicated, all
\nsuch beneficiaries will have an equal, undivided interest in all such Stock
\nOptions.<\/p>\n<\/p>\n

4<\/p>\n<\/p>\n

\n

21. Should a beneficiary die after the Participant but before the option is
\nexercised, such beneficiary’s rights and interest in the option award will be
\ntransferable by last will and testament of the beneficiary or the laws of
\ndescent and distribution. A named beneficiary who predeceases the Participant
\nwill obtain no rights or interest in a stock option award, nor will any person
\nclaiming on behalf of such individual. Unless otherwise specifically indicated
\nby the Participant on the form, beneficiaries designated by class (such as
\n“children,” “grandchildren” etc.) will be deemed to refer to the members of the
\nclass living at the time of the Participant’s death, and all members of the
\nclass will be deemed to take “per capita<\/u>.”<\/p>\n

Transferable Options <\/em><\/strong><\/p>\n

22. Transferable Stock Options may be transferred to one or more immediate
\nfamily members, individually or jointly. Immediate family members shall be
\ndeemed to include the Participant’s spouse, parents, siblings, children,
\ngrandchildren and the spouse of any parent, sibling, child or grandchild, in
\neach case determined at the effective time of transfer. A trust, each of whose
\nbeneficiaries is the Participant or an immediate family member, will be deemed
\nto be a family member for purposes of these rules.<\/p>\n

23. A transfer shall be effective on the date written notice thereof, on a
\nform approved for this purpose, is received by the Plan administrator. As a
\ncondition to transfer, the Participant shall agree to remain responsible to pay
\nin cash the applicable taxes due upon exercise of the option by the transferee.
\nThe Participant or the Participant’s estate will be required to provide
\nsufficient evidence of ability to pay such taxes upon the Company’s request.\n<\/p>\n

24. A transfer shall be irrevocable; no subsequent transfer by the transferee
\nshall be effective. Notwithstanding the foregoing, a transferee shall be
\nentitled to designate a beneficiary in accordance with the provisions of
\nparagraphs 16 through 21 above. Except where a beneficiary has been designated,
\nin the event of death of the transferee prior to option exercise, the
\ntransferee’s option will be transferable by last will and testament of the
\nbeneficiary or the laws of descent and distribution.<\/p>\n

25. Except as modified by the provisions of paragraphs 22 through 24, all
\nterms applicable to option exercises by Participants are applicable to exercises
\nby transferees. The Plan administrator may make and publish additional rules
\napplicable to exercises by transferees not inconsistent with these provisions.\n<\/p>\n

Performance Feature <\/strong><\/p>\n

26. If a Stock Option is issued with a performance feature, the following
\nadditional terms and conditions will apply to that Award:<\/p>\n<\/p>\n\n\n\n
<\/td>\n\n<\/td>\n<\/td>\n\n

The Participant will have the right to purchase from 0% to 200%
\nof the number of Shares indicated in the Award certificate, based on achievement
\nof performance objectives established by the Committee for that Award.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
<\/td>\n\n<\/td>\n<\/td>\n\n

The performance period and vesting schedule will be set forth in
\nthe Award certificate.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n
<\/td>\n\n<\/td>\n<\/td>\n\n

The performance conditions may be adjusted as deemed appropriate
\nin the Committee’s business judgment.<\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

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