This excerpt taken from the SAF 10-Q filed Aug 4, 2005.
and as Amended and Restated November 6, 2002
The following provisions set forth the terms of the stock award program (the Program) for non-employee directors of SAFECO Corporation (Company) under the SAFECO Long-Term Incentive Plan of 1997 (the Plan). The following terms are intended to supplement, not alter or change, the provisions of the Plan, and in the event of any inconsistency between these terms and those in the Plan, the Plan shall govern. All capitalized terms that are not defined in this Program shall be as defined in the Plan.
Each director of the Company who is not an employee of the Company or any Subsidiary (an Eligible Director) shall be eligible to receive annual awards under the Plan, as described below.
Commencing with the 2003 annual meeting of the Companys shareholders, a restricted stock right (RSR) of 2,500 shares of the Companys common stock shall automatically be granted to each Eligible Director in office immediately after the annual shareholders meeting and, if the initial election of an Eligible Director occurs other than at an annual meeting of shareholders, then the award shall be granted immediately following the initial election. The terms of the award shall be set forth in an Award Agreement.
RSRs granted to Eligible Directors shall be settled upon termination of service as an Eligible Director as described in Section 4, such period of time constituting the Restricted Period.
RSRs granted to Eligible Directors shall not be transferable other than by will or the laws of descent and distribution.
An Eligible Director may elect to defer the dividends accrued on any or all RSRs granted to the Eligible Director under this Program and settled RSRs under this Program as provided in the SAFECO Corporation Deferred Compensation Plan for Directors, as it may be amended from time to time, or any other plan or arrangement under which settled RSRs or dividends accrued on RSRs is permitted to be deferred.
In the event of a Change in Control of the Company, all outstanding RSRs shall be settled by a payment in cash. The fair market value of each share shall be equal to the greater of (i) the fair market value of a share of the Companys common stock as of the date on which a Change in Control occurs, and (ii) the highest price of a share of Company common stock that is paid or offered to be paid by any Person or entity in connection with any transaction that constitutes a Change in Control.
Except for certain provisions of the Plan whose application is clearly limited to employee participants, the provisions of the Plan, as it may be amended from time to time, shall apply to Awards granted to Eligible Directors under this Program.