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IAR » Topics » Equity-Based Incentive Awards

These excerpts taken from the IAR 10-K filed Mar 27, 2009.

Equity-Based Incentive Awards

 

The following is a summary of the vesting provisions applicable to the outstanding equity-based incentive awards held by our named executive officers, other than our chief executive officer, as of December 31, 2008.  The vesting provisions applicable to outstanding equity-based incentive awards held by our chief executive officer are summarized under “CEO Employment Agreement” immediately above.

 

The award agreements for the equity incentive awards described below include varying provisions regarding the treatment of awards in the event a change in control of the company occurs.  However, the transition plan provides that, in the event a change in control of the company occurs, all outstanding long-term incentive awards held by each of our named executive officers will become fully vested if the officer is employed by the company immediately before the change in control occurs.  For additional information, see “Executive Transition Plan — Termination in Connection with a Change in Control” immediately above.

 

Annual Long-Term Incentive Awards.  The company’s long-term incentive awards granted since the spin-off from Verizon included a grant of performance units for the 2007-2009 performance cycle and grants of performance share units and restricted stock for the 2008-2010 performance cycle.  Under the related award agreements, if the employment of the named executive officer is terminated by the company without cause or as a result of the officer’s death, disability or retirement, then (a) the performance units and performance share units will vest immediately, subject to the company meeting the applicable TSR performance targets, and (b) the shares of restricted stock will vest immediately.

 

Under the award agreements, an officer is deemed to have been terminated without cause if the officer is terminated for any reason other than:

 

·      a felony conviction;

 

·      fraud involving the company;

 

·      willful failure to carry out material employment responsibilities;

 

·      behavior likely to have an adverse effect on the company;

 

·      a material violation of company policy; or

 

·      with respect to the 2007 award agreement only, a material breach of the non-disclosure, non-competition and non-solicitation covenants in the award agreement.

 

However, please note that pursuant to our restructuring, all current equity incentive plans, equity ownership plans or other equity-based plans will likely be terminated and all equity owned under such plans will likely be cancelled.

 

2007 Restricted Stock Award.  The award agreement for the January 9, 2007, grant of restricted stock provides for accelerated vesting if the named executive officer’s employment is terminated by the company without cause or is terminated due to death or retirement (after June 30 of the calendar year in which the retirement occurs).

 

If the employment of a named executive officer is terminated by the company without cause, the officer will vest immediately in a prorated portion of the shares of restricted stock that would have vested on the next anniversary of the grant, based upon the number of days elapsed from the preceding January 9 until the date the officer’s employment is terminated.

 

Under the award agreement, an officer is deemed to have been terminated without cause if the officer is terminated for any reason other than:

 

·      commission of a felony;

 

·      grossly incompetent performance or substantial or continuing inattention or neglect of employment responsibilities;

 

·      fraud, misappropriation or embezzlement or material breach of the company’s code of conduct; or

 

·      such other misconduct detrimental to the company or the ability of the officer to fully perform his or her employment duties.

 

If a named executive officer’s employment is terminated due to death or retirement (after June 30 of the calendar year in which the retirement occurs), the officer (or his or her beneficiary) will vest immediately in the shares of restricted stock that would vest on the next anniversary of the grant if the officer’s employment had continued.

 

39


Table of Contents

 

However, pursuant to our restructuring, all current equity incentive plans, equity ownership plans or other equity-based plans will likely be terminated and all equity owned under such plans will likely be cancelled, included outstanding restricted stock.

 

Gatto Restricted Stock Award.  The award agreement for the May 2008 grant of restricted stock to Mr. Gatto provides that if his employment is terminated by the company without cause or as a result of his death, disability or retirement, then all outstanding shares of restricted stock will vest immediately.  The definition of cause under this award is consistent with the definition of cause under the long-term incentive award for the 2008-2010 performance cycle described under “Annual Long-Term Incentive Awards” above.  However, pursuant to our restructuring, all current equity incentive plans, equity ownership plans or other equity-based plans will likely be terminated and all equity owned under such plans will likely be cancelled.

 

Obligations of the Officer.  Each of the equity-based incentive awards described above is conditioned upon the named executive officer complying with certain restrictive covenants in the applicable award agreements, including non-disclosure, non-competition and non-solicitation covenants.  The non-competition and non-solicitation covenants expire on the first anniversary of the officer’s termination of employment.  The non-disclosure covenant does not expire.

 

Equity-Based Incentive Awards

 

The following is a summary of the vesting provisions applicable to the outstanding equity-based incentive awards held by our named executive officers, other than our chief executive officer, as of December 31, 2008.  The vesting provisions applicable to outstanding equity-based incentive awards held by our chief executive officer are summarized under “CEO Employment Agreement” immediately above.

 

The award agreements for the equity incentive awards described below include varying provisions regarding the treatment of awards in the event a change in control of the company occurs.  However, the transition plan provides that, in the event a change in control of the company occurs, all outstanding long-term incentive awards held by each of our named executive officers will become fully vested if the officer is employed by the company immediately before the change in control occurs.  For additional information, see “Executive Transition Plan — Termination in Connection with a Change in Control” immediately above.

 

Annual Long-Term Incentive Awards.  The company’s long-term incentive awards granted since the spin-off from Verizon included a grant of performance units for the 2007-2009 performance cycle and grants of performance share units and restricted stock for the 2008-2010 performance cycle.  Under the related award agreements, if the employment of the named executive officer is terminated by the company without cause or as a result of the officer’s death, disability or retirement, then (a) the performance units and performance share units will vest immediately, subject to the company meeting the applicable TSR performance targets, and (b) the shares of restricted stock will vest immediately.

 

Under the award agreements, an officer is deemed to have been terminated without cause if the officer is terminated for any reason other than:

 

·      a felony conviction;

 

·      fraud involving the company;

 

·      willful failure to carry out material employment responsibilities;

 

·      behavior likely to have an adverse effect on the company;

 

·      a material violation of company policy; or

 

·      with respect to the 2007 award agreement only, a material breach of the non-disclosure, non-competition and non-solicitation covenants in the award agreement.

 

However, please note that pursuant to our restructuring, all current equity incentive plans, equity ownership plans or other equity-based plans will likely be terminated and all equity owned under such plans will likely be cancelled.

 

2007 Restricted Stock Award.  The award agreement for the January 9, 2007, grant of restricted stock provides for accelerated vesting if the named executive officer’s employment is terminated by the company without cause or is terminated due to death or retirement (after June 30 of the calendar year in which the retirement occurs).

 

If the employment of a named executive officer is terminated by the company without cause, the officer will vest immediately in a prorated portion of the shares of restricted stock that would have vested on the next anniversary of the grant, based upon the number of days elapsed from the preceding January 9 until the date the officer’s employment is terminated.

 

Under the award agreement, an officer is deemed to have been terminated without cause if the officer is terminated for any reason other than:

 

·      commission of a felony;

 

·      grossly incompetent performance or substantial or continuing inattention or neglect of employment responsibilities;

 

·      fraud, misappropriation or embezzlement or material breach of the company’s code of conduct; or

 

·      such other misconduct detrimental to the company or the ability of the officer to fully perform his or her employment duties.

 

If a named executive officer’s employment is terminated due to death or retirement (after June 30 of the calendar year in which the retirement occurs), the officer (or his or her beneficiary) will vest immediately in the shares of restricted stock that would vest on the next anniversary of the grant if the officer’s employment had continued.

 

39


Table of Contents

 

However, pursuant to our restructuring, all current equity incentive plans, equity ownership plans or other equity-based plans will likely be terminated and all equity owned under such plans will likely be cancelled, included outstanding restricted stock.

 

Gatto Restricted Stock Award.  The award agreement for the May 2008 grant of restricted stock to Mr. Gatto provides that if his employment is terminated by the company without cause or as a result of his death, disability or retirement, then all outstanding shares of restricted stock will vest immediately.  The definition of cause under this award is consistent with the definition of cause under the long-term incentive award for the 2008-2010 performance cycle described under “Annual Long-Term Incentive Awards” above.  However, pursuant to our restructuring, all current equity incentive plans, equity ownership plans or other equity-based plans will likely be terminated and all equity owned under such plans will likely be cancelled.

 

Obligations of the Officer.  Each of the equity-based incentive awards described above is conditioned upon the named executive officer complying with certain restrictive covenants in the applicable award agreements, including non-disclosure, non-competition and non-solicitation covenants.  The non-competition and non-solicitation covenants expire on the first anniversary of the officer’s termination of employment.  The non-disclosure covenant does not expire.

 

Equity-Based
Incentive Awards



 



The following
is a summary of the vesting provisions applicable to the outstanding
equity-based incentive awards held by our named executive officers, other than
our chief executive officer, as of December 31, 2008.  The vesting provisions applicable to
outstanding equity-based incentive awards held by our chief executive officer
are summarized under “CEO Employment Agreement” immediately above.



 



The award
agreements for the equity incentive awards described below include varying
provisions regarding the treatment of awards in the event a change in control
of the company occurs.  However, the
transition plan provides that, in the event a change in control of the company
occurs, all outstanding long-term incentive awards held by each of our named
executive officers will become fully vested if the officer is employed by the
company immediately before the change in control occurs.  For additional information, see “Executive
Transition Plan — Termination in Connection with a Change in Control”
immediately above.



 



Annual
Long-Term Incentive Awards.  The company’s long-term incentive
awards granted since the spin-off from Verizon included a grant of performance
units for the 2007-2009 performance cycle and grants of performance share
units and restricted stock for the 2008-2010 performance cycle.  Under the related award agreements, if the
employment of the named executive officer is terminated by the company without
cause or as a result of the officer’s death, disability or retirement, then (a) the
performance units and performance share units will vest immediately, subject to
the company meeting the applicable TSR performance targets, and (b) the
shares of restricted stock will vest immediately.



 



Under the
award agreements, an officer is deemed to have been terminated without cause if
the officer is terminated for any reason other than:



 



·      a felony conviction;



 



·      fraud involving the company;



 



·      willful failure to carry out
material employment responsibilities;



 



·      behavior likely to have an
adverse effect on the company;



 



·      a material violation of
company policy; or



 



·      with respect to the 2007
award agreement only, a material breach of the non-disclosure, non-competition
and non-solicitation covenants in the award agreement.



 



However,
please note that pursuant to our restructuring, all current equity
incentive plans, equity ownership plans or other equity-based plans will likely
be terminated and all equity owned under such plans will likely be
cancelled.



 



2007
Restricted Stock Award.  The award agreement for the January 9,
2007, grant of restricted stock provides for accelerated vesting if the named
executive officer’s employment is terminated by the company without cause or is
terminated due to death or retirement (after June 30 of the calendar year
in which the retirement occurs).



 



If the
employment of a named executive officer is terminated by the company without
cause, the officer will vest immediately in a prorated portion of the shares of
restricted stock that would have vested on the next anniversary of the grant,
based upon the number of days elapsed from the preceding January 9 until the
date the officer’s employment is terminated.



 



Under the
award agreement, an officer is deemed to have been terminated without cause if
the officer is terminated for any reason other than:



 



·      commission of a felony;



 



·      grossly incompetent
performance or substantial or continuing inattention or neglect of employment
responsibilities;



 



·      fraud, misappropriation or
embezzlement or material breach of the company’s code of conduct; or



 



·      such other misconduct
detrimental to the company or the ability of the officer to fully perform his
or her employment duties.



 



If a named
executive officer’s employment is terminated due to death or retirement (after June 30
of the calendar year in which the retirement occurs), the officer (or his or
her beneficiary) will vest immediately in the shares of restricted stock that
would vest on the next anniversary of the grant if the officer’s employment had
continued.



 



39















Table of Contents



 



However,
pursuant to our restructuring, all current equity incentive plans,
equity ownership plans or other equity-based plans will likely be terminated
and all equity owned under such plans will likely be cancelled, included
outstanding restricted stock.



 



Gatto Restricted Stock Award.  The award agreement for the May 2008
grant of restricted stock to Mr. Gatto provides that if his employment is
terminated by the company without cause or as a result of his death, disability
or retirement, then all outstanding shares of restricted stock will vest
immediately.  The definition of cause
under this award is consistent with the definition of cause under the long-term
incentive award for the 2008-2010 performance cycle described under “Annual
Long-Term Incentive Awards” above. 
However, pursuant to our restructuring, all current equity incentive plans, equity ownership plans or other
equity-based plans will likely be terminated and all equity owned under such
plans will likely be cancelled.



 



Obligations of the Officer.  Each of the equity-based incentive awards
described above is conditioned upon the named executive officer complying with
certain restrictive covenants in the applicable award agreements, including
non-disclosure, non-competition and non-solicitation covenants.  The non-competition and non-solicitation
covenants expire on the first anniversary of the officer’s termination of
employment.  The non-disclosure covenant
does not expire.



 



Equity-Based
Incentive Awards



 



The following
is a summary of the vesting provisions applicable to the outstanding
equity-based incentive awards held by our named executive officers, other than
our chief executive officer, as of December 31, 2008.  The vesting provisions applicable to
outstanding equity-based incentive awards held by our chief executive officer
are summarized under “CEO Employment Agreement” immediately above.



 



The award
agreements for the equity incentive awards described below include varying
provisions regarding the treatment of awards in the event a change in control
of the company occurs.  However, the
transition plan provides that, in the event a change in control of the company
occurs, all outstanding long-term incentive awards held by each of our named
executive officers will become fully vested if the officer is employed by the
company immediately before the change in control occurs.  For additional information, see “Executive
Transition Plan — Termination in Connection with a Change in Control”
immediately above.



 



Annual
Long-Term Incentive Awards.  The company’s long-term incentive
awards granted since the spin-off from Verizon included a grant of performance
units for the 2007-2009 performance cycle and grants of performance share
units and restricted stock for the 2008-2010 performance cycle.  Under the related award agreements, if the
employment of the named executive officer is terminated by the company without
cause or as a result of the officer’s death, disability or retirement, then (a) the
performance units and performance share units will vest immediately, subject to
the company meeting the applicable TSR performance targets, and (b) the
shares of restricted stock will vest immediately.



 



Under the
award agreements, an officer is deemed to have been terminated without cause if
the officer is terminated for any reason other than:



 



·      a felony conviction;



 



·      fraud involving the company;



 



·      willful failure to carry out
material employment responsibilities;



 



·      behavior likely to have an
adverse effect on the company;



 



·      a material violation of
company policy; or



 



·      with respect to the 2007
award agreement only, a material breach of the non-disclosure, non-competition
and non-solicitation covenants in the award agreement.



 



However,
please note that pursuant to our restructuring, all current equity
incentive plans, equity ownership plans or other equity-based plans will likely
be terminated and all equity owned under such plans will likely be
cancelled.



 



2007
Restricted Stock Award.  The award agreement for the January 9,
2007, grant of restricted stock provides for accelerated vesting if the named
executive officer’s employment is terminated by the company without cause or is
terminated due to death or retirement (after June 30 of the calendar year
in which the retirement occurs).



 



If the
employment of a named executive officer is terminated by the company without
cause, the officer will vest immediately in a prorated portion of the shares of
restricted stock that would have vested on the next anniversary of the grant,
based upon the number of days elapsed from the preceding January 9 until the
date the officer’s employment is terminated.



 



Under the
award agreement, an officer is deemed to have been terminated without cause if
the officer is terminated for any reason other than:



 



·      commission of a felony;



 



·      grossly incompetent
performance or substantial or continuing inattention or neglect of employment
responsibilities;



 



·      fraud, misappropriation or
embezzlement or material breach of the company’s code of conduct; or



 



·      such other misconduct
detrimental to the company or the ability of the officer to fully perform his
or her employment duties.



 



If a named
executive officer’s employment is terminated due to death or retirement (after June 30
of the calendar year in which the retirement occurs), the officer (or his or
her beneficiary) will vest immediately in the shares of restricted stock that
would vest on the next anniversary of the grant if the officer’s employment had
continued.



 



39















Table of Contents



 



However,
pursuant to our restructuring, all current equity incentive plans,
equity ownership plans or other equity-based plans will likely be terminated
and all equity owned under such plans will likely be cancelled, included
outstanding restricted stock.



 



Gatto Restricted Stock Award.  The award agreement for the May 2008
grant of restricted stock to Mr. Gatto provides that if his employment is
terminated by the company without cause or as a result of his death, disability
or retirement, then all outstanding shares of restricted stock will vest
immediately.  The definition of cause
under this award is consistent with the definition of cause under the long-term
incentive award for the 2008-2010 performance cycle described under “Annual
Long-Term Incentive Awards” above. 
However, pursuant to our restructuring, all current equity incentive plans, equity ownership plans or other
equity-based plans will likely be terminated and all equity owned under such
plans will likely be cancelled.



 



Obligations of the Officer.  Each of the equity-based incentive awards
described above is conditioned upon the named executive officer complying with
certain restrictive covenants in the applicable award agreements, including
non-disclosure, non-competition and non-solicitation covenants.  The non-competition and non-solicitation
covenants expire on the first anniversary of the officer’s termination of
employment.  The non-disclosure covenant
does not expire.



 



EXCERPTS ON THIS PAGE:

10-K (4 sections)
Mar 27, 2009

RELATED TOPICS for IAR:

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