ACL » Topics » DEFINITIONS

This excerpt taken from the ACL 6-K filed Feb 17, 2005.

DEFINITIONS

For purposes of the Plan, the following terms shall have the following meanings, unless another definition is clearly indicated by particular usage and context:
 
2.1 “Award” means any form of incentive or performance Award granted under the Plan, whether singly or in combination, to a Participant pursuant to such terms, conditions, restrictions, and/or limitations (if any) as the Committee may establish and set forth in the applicable Award Certificate. Awards granted under the Plan may consist of:

(a)“Annual Incentive Awards” awarded pursuant to Section 4.4;

(b) “Stock Option Awards” awarded pursuant to Section 4.5;

(c) “Stock Appreciation Rights” awarded pursuant to Section 4.6;

(d) “Restricted Stock” awarded pursuant to Section 4.7;

(e) “Performance-Based Awards” awarded pursuant to Section 4.8;

(f) “Other Stock-Based Awards” awarded pursuant to Section 4.9


2.2 “Award Certificate” means the document distributed, either in writing or by electronic means, to a Participant by the Committee evidencing the grant of an Award.
 
2.3 "Board" means the Board of Directors of the Company.

2.4 “Change-of-Control” means the happening of any of the following:
 

 

(a) any “person” including a “group” (as such terms are used in Sections 13(d) and 14(d) of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”)), but excluding (i) the Company, (ii) any entity controlling, controlled by or under common control with the Company, including Nestle S.A. (Nestle), (iii) any employee benefit plan of the Company or any such entity, (iv) any entity or group acting to facilitate any initial public offering of the Shares and, (v) with respect to any particular Participant, the Participant and any “group” (as such term is used in Section 13(d)(3) of the Exchange Act) of which such Participant is a member, and (vi) any acquisition of securities directly from the Company, is or becomes the “beneficial owner” (as defined in Rule 13(d)(3) under the Exchange Act), directly or indirectly, of securities of the Company representing 50% or more of either (i) the combined voting power of the Company’s then outstanding securities or (ii) the then outstanding Shares; or

  (b) the consummation of any consolidation or merger of the Company or subsidiary where the shareholders of the Company, immediately prior to the consolidation or merger, do not, immediately after the consolidation or merger, beneficially own (as such term is used in Rule 13(d)(3) under the Exchange Act), directly or indirectly, securities representing in the aggregate 51% or more of the combined voting power of the then outstanding voting securities of the corporation issuing cash or securities in the consolidation or merger (or its ultimate parent corporation, if any), except any such transaction with Nestle or any entity controlled by Nestle; or

  (c) any sale, lease, exchange or other transfer (in one transaction or in a series of transactions contemplated or arranged by any party as a single plan) of all or substantially all of the assets of the Company, other than the sale or disposition by the Company of all or substantially all of the Company’s assets either (i) to an entity, at least 51% of the combined voting power of the voting securities of which are beneficially owned by shareholders in substantially the same proportion as their ownership of the Company immediately prior to such sale or (ii) to Nestle or to an entity controlled by Nestle, or

  (d) during any period of two consecutive years commencing on or after January 1, 2002, individuals who, at the beginning of the period, constituted the Board (together with any new directors whose election by such Board or whose nomination for election by the stockholders of the Company was approved by a majority of the directors then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute at least a majority of the Board of Directors then in office.

2.5 "Code" means the U.S. Internal Revenue Code of 1986, as amended.

2.6 “Committee” means the Compensation Committee of the Board formed to make recommendations for approval by the Board as a whole, or any successor Committee or sub-committee of the Board. It is understood throughout this Plan that the Committee only recommends actions to the Board for approval.
 
2.7 "Common Stock" means the registered common stock, CHF 0.20 par value per share, of the Company.
 
2.8 "Company" means Alcon, Inc., and its subsidiaries, successors and assigns.

2.9 “Disabled” or “Disability” means permanently and totally disabled within the meaning of the applicable disability plans of the Company (or its subsidiary) for the country of residence of the affected individual.
 
2.10 “Employee” means any individual, including any officer of the Company, who is on the active payroll of the Company or a Subsidiary or serves as a Non-Employee Director of the Company at the relevant time. “Employee” shall not include any seasonal, independent contractors, leased or temporary employees.
 
2.11 "Exchange Act" means the Securities Exchange Act of 1934, as amended.

2.12 “Fair Market Value” means the closing sales price of a Share as reported on the Stock Market on the date as of which the determination is being made or, if no sale of Shares is reported on such date, on the next preceding day on which there were sales of Shares reported.
 
2.13 “Fair Market Value Stock Option” means a Stock Option with the Grant Price set by the Board at a price per Share equal to the Fair Market Value, as defined in Section 2.12, of a Share on the date of grant.
 
2.14 "GAAP" means U.S. Generally Accepted Accounting Principles.

2.15 “Grant Price” means the price per share at which Shares may be purchased under a Stock Option and the price per share used as the base price for measuring the appreciation, if any, under a Stock Appreciation Right. The Grant Price shall not be less than the Fair Market Value of the Shares covered by the Stock Option or Stock Appreciation Right on the date the Stock Option or Stock Appreciation Right is granted unless specifically approved by the Board.
 
2.16 “Incentive Stock Option” means a Stock Option granted under Section 4.5 of the Plan designated by the Board in an Award Certificate to be an Incentive Stock Option that meets the requirements of (i) Section 422 of the Code, or (ii) the revenue code, and any regulations or rules promulgated thereunder in the country of the Participant.
 
2.17 “Market Price” means the Fair Market Value of a Share on the date a Stock Option or Stock Appreciation Right is exercised.
 
2.18 “Non-Employee Director” means a director of the Company described in Rule 16(b)-3(b)(3)(i) of the Exchange Act who is not (I) a full-time employee of Nestle, the Company, or a Subsidiary or (II) a member of the Nestle board of directors.
 
2.19 “Nonqualified Stock Option” means any Stock Option granted under Section 4.5 of the Plan that is not an Incentive Stock Option.
 
2.20 “Participant” means exclusively an Employee of the Company or a Subsidiary who has been granted an Award under the Plan.
 
2.21 “Performance-Based Awards” mean an Award to be earned in whole or in part according to, and contingent upon, the degree of achievement of Performance Goals over a Performance Cycle granted under Section 4.8 of the Plan in the form of cash, Shares or any combination thereof.
 
2.22 “Performance Cycle” means, with respect to any Annual Incentive Award, Performance-Based Award or Other Stock-Based Award granted under the Plan, the period over which the Company’s level of attainment of a Performance Measure shall be determined.
 
2.23 “Performance Goals” mean, with respect to any applicable Award made pursuant to the Plan, the one or more targets, goals or levels of attainment required to be achieved in terms of the specified Performance Measure during the specified Performance Cycle, all as set forth in the related Award Certificate.
 
2.24 “Performance Measure” means, with respect to any Annual Incentive Award, Performance Grant or Other Stock-Based Award granted in connection with a Performance Cycle, the business criteria recommended by the Committee and approved by the Board to measure the level of performance of the Company during such Performance Cycle. The Committee may select for Board approval as the Performance Measure for a Performance Cycle any Performance Goals and/or one or combination of the following financial measures, as interpreted by the Committee, which (to the extent applicable) can be determined either on a pro forma or GAAP basis, and either pre-tax or after-tax,: Earnings per Share, Return on Equity, Return on Invested Capital, Relative Total Shareholder Return, Revenue Growth, Share Performance, Net Income, Return on Sales, Return on Assets, Economic Value Added, Cash Flow, Cumulative Operating Income (which shall equal consolidated sales minus cost of goods sold and selling, administrative and general expense) or other measures subject to review for compliance with 162(m).
 
2.25 “Plan” means the 2002 Alcon Incentive Plan, as set forth in this document and as may be amended from time to time.
 
2.26 “Restricted Stock” means Shares issued under a Restricted Stock Award pursuant to Section 4.7 that are subject to such restrictions recommended by the Committee, in its discretion, and approved by the Board.
 
2.27 “Restriction Period” means the period during which shares subject to a Restricted Stock Award are subject to forfeiture or repurchase.
 
2.28 “Retirement” means retirement with consent of the Board and (i) at or after age 55 with no less than ten years of service or (ii) at or after age 62.
2.29 “Shares” mean shares of Common Stock.

2.30 “Stock Appreciation Rights” mean the right to an amount (payable in Shares, in cash, or a combination thereof as the Committee shall recommend and the Board shall approve) that does not exceed the excess of the Market Price over the Grant Price for the number of Shares for which the Stock Appreciation Right is exercised.
 
2.31 “Stock Market” means the New York Stock Exchange or other listing system selected by the Board in its sole discretion on which Shares are listed or quoted for sale.
 
2.32 “Stock Options” mean the right to purchase from the Company a stated number of Shares at a specified Grant Price. Stock Options Awarded under the Plan shall be in the form of either Incentive Stock Options or Nonqualified Stock Options.
 
2.33 “Subsidiary” means any corporation or entity in which the Company (i) directly or indirectly owns or controls stock possessing 50% or more of the total combined voting power of all classes of stock issued by such corporation or entity; or (ii) otherwise has the power to determine the election or removal of a majority of the members of the Board of directors.
 
2.34 “Termination of Employment” means the date of cessation of an Employee’s employment relationship with the Company and its Subsidiaries for any reason, with or without cause as determined by the Company or the relevant Subsidiary; provided, however, that for purposes of this Plan, an Employee’s employment relationship shall be treated as continuing intact while the Employee is on military reserve duty, sick leave or other bona fide leave of absence (such as temporary employment with the Government) that has been approved by the Company or the relevant Subsidiary to the extent the period of the leave does not exceed the longer of 90 days or the period the Employee’s right to continued employment and reemployment with the Company or the relevant Subsidiary is guaranteed either by law or by contract. Employees called for active Military Duty shall have their employment relationship continued intact for the duration of their term of required military service. Where the period of leave exceeds ninety (90) days and where the Employee’s right to continued employment and reemployment is not guaranteed either by slaw or contract, the employment relationship will be deemed to have terminated on the ninety-first (91st) day of such leave.
 
2.35 “Unit” means a bookkeeping entry used by the Company to record and account for the grant, settlement or, if applicable, deferral of an Award until such time as such Award is paid, canceled, forfeited or terminated, as the case may be, which, except as otherwise specified by the Committee, shall be equal to one Share.
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