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EX-10.19
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seniorplan.txt
SENIOR EXECUTIVE PERFORMANCE PLAN
EXHIBIT 10.19
SILGAN HOLDINGS INC.
SENIOR EXECUTIVE PERFORMANCE PLAN
1. PURPOSE
The purpose of the Silgan Holdings Inc. Senior Executive Performance Plan
is to permit Silgan Holdings Inc. (the "Company"), through awards of incentive
compensation that satisfy the requirements for performance-based compensation
under Section 162(m) of the Internal Revenue Code, to attract and retain certain
senior executives and to motivate these senior executives to promote the
profitability and growth of the Company.
2. DEFINITIONS
"AWARD" shall mean the amount granted to a Participant by the Committee for
a Performance Period, provided that the amount of the Award for any Participant
for a Performance Period shall in no event exceed the Maximum Award for such
Performance Period.
"BOARD" shall mean the Board of Directors of the Company.
"CODE" shall mean the Internal Revenue Code of 1986, as amended. References
to the Code shall be deemed to include references to the applicable Treasury
Regulations promulgated thereunder.
"COMMITTEE" shall mean the Compensation Committee of the Board or any
subcommittee thereof comprised solely of "outside directors" meeting the
requirements of Section 162(m)(4)(C) of the Code.
"DISABILITY" shall mean the inability of the Participant, by reason of
illness or injury, to perform substantially all of his duties as an Executive
during any continuous period of 180 days.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended.
"EXECUTIVE" shall mean each of R. Philip Silver and D. Greg Horrigan, the
current Co-Chief Executive Officers of the Company.
"MAXIMUM AWARD" shall mean, for the Performance Period beginning on January
1, 2003, $1,621,060, and for each Performance Period thereafter an amount equal
to 103% of the Maximum Award for the immediately preceding Performance Period.
"PARTICIPANT" shall mean, for each Performance Period, each Executive who
is a "covered employee" (as defined in Section 162(m) of the Code) for that
Performance Period.
"PERFORMANCE GOAL" shall mean, for any Performance Period, the criteria
selected by the Committee to measure the performance of the Company during such
Performance Period from one or more of the following:
(i) net income;
(ii) earnings per share;
(iii) income from operations;
(iv) earnings before interest expense and provision for income taxes
(EBIT);
(v) earnings before interest expense, provision for income taxes,
depreciation and amortization expenses (EBITDA);
(vi) economic value added;
(vii) return on net assets;
(vii) return on total assets;
(viii) free cash flow from operations;
(ix) return on invested capital;
(x) return on stockholders' equity;
(xi) expense reduction;
(xii) working capital;
(xiii) total shareholder return; and
(xiv) stock price performance of the Company's common stock.
The Committee may elect to exclude in calculating any Performance Goal (i)
unusual gains and unusual losses, (ii) the amount of all charges and expenses
incurred or income earned in connection with any refinancing, restructuring,
rationalization, recapitalization or reorganization involving the Company and
its subsidiaries, (iii) the cumulative effects of accounting changes, (iv)
discontinued operations, and (v) businesses, units, divisions, subsidiaries or
other entities sold or acquired.
"PERFORMANCE GOAL TARGETS" shall mean, for any Performance Goal, the levels
of performance during a Performance Period under such Performance Goal
established by the Committee to determine a Participant's Award and the manner
of calculating the amount of an Award for a Participant based on such
Performance Goal(s) and Performance Goal Targets.
"PERFORMANCE PERIOD" shall mean the Company's fiscal year.
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"PLAN" shall mean this Silgan Holdings Inc. Senior Executive Performance
Plan, as amended from time to time.
3. ADMINISTRATION
The Plan shall be administered by the Committee, which shall have full
authority to interpret the Plan, to establish rules and regulations relating to
the operation of the Plan, to determine the amounts of any Awards and to make
all determinations and take all other actions necessary or appropriate for the
proper administration of the Plan. Before any payments for Awards are made under
the Plan for any Performance Period, the Committee shall certify in writing, for
such Performance Period, the Performance Goal Target or Targets (or level
thereof) met and the amount of the Award payable to each Participant. The
Committee's interpretation of the Plan, and all actions taken within the scope
of its authority, shall be final and binding on the Company, its stockholders,
Participants, Executives, former Executives and their respective successors and
assigns. No member of the Committee shall be eligible to participate in the
Plan.
4. DETERMINATION OF AWARDS
(a) Not later than 90 days after each Performance Period commences and
prior to the elapsing of 25 percent of the Performance Period (or such later
time as may be permitted by applicable provisions of the Code), the Committee
shall establish in writing for each Participant for such Performance Period one
or more Performance Goals and, for each Performance Goal, one or more
Performance Goal Targets and the method by which achievement thereof will be
measured.
(b) Following the end of each Performance Period, the Committee shall
certify in writing the extent to which the Performance Goal Targets required by
Section 4(a) have been met. If such Performance Goal Targets have been met, the
Committee shall grant to the Participant an Award, which shall not exceed the
Maximum Award and shall be calculated as established by the Committee pursuant
to Section 4(a).
(c) Subject to this Section 4(c), no Award shall be payable to any
Participant who is not an employee of the Company on the last day of the
Performance Period to which such Award relates. In the event that a Participant
terminates employment because of death, Disability or retirement, such
Participant (or in the event of death, the Participant's estate or beneficiary
designated under rules prescribed by the Committee) shall be paid a pro rata
portion of the Participant's Award that would otherwise be payable upon
achievement of the Performance Goal Target or Targets had the Participant
continued employment until the end of the Performance Period. Such pro rata
Award shall not be paid until after the end of the Performance Period to which
such Award relates.
5. PAYMENT OF AWARDS
Each Participant shall be eligible to receive, as soon as practicable after
the amount of such Participant's Award for a Performance Period has been
determined, payment of that Award. Awards shall be paid in cash. Payment of the
Award may be deferred in accordance with a written election by the Participant
pursuant to procedures established by the Committee.
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6. AMENDMENTS
The Committee may amend the Plan at any time and from time to time,
provided that any such amendment shall have been unanimously approved by all
members of the Committee and provided further that no such amendment that would
require the consent of the stockholders of the Company pursuant to Section
162(m) of the Code or the Exchange Act, or any other applicable law, rule or
regulation, shall be effective without such consent. No such amendment which
adversely affects a Participant's rights to, or interest in, an Award granted
prior to the date of the amendment shall be effective unless the Participant
shall have agreed thereto in writing.
7. TERMINATION
The Committee may terminate this Plan at any time, provided that any such
termination shall have been unanimously approved by all members of the
Committee. In such event, and notwithstanding any provisions of the Plan to the
contrary, payment of deferred amounts plus any earnings may be accelerated with
respect to any affected Participant in the discretion of the Committee and paid
as soon as practicable; but in no event shall the termination of the Plan
adversely affect the rights of any Participant to deferred amounts previously
awarded such Participant, plus any earnings thereon.
8. OTHER PROVISIONS
(a) Neither the establishment of this Plan, nor any action taken
hereunder, shall be construed as giving any Executive any right to be retained
in the employ of the Company. Nothing contained in this Plan shall limit the
ability of the Company to make payments or awards to Executives under any other
plan, agreement or arrangement.
(b) The rights and benefits of a Participant hereunder are personal to the
Participant and, except for payments made following a Participant's death, shall
not be subject to any voluntary or involuntary alienation, assignment, pledge,
transfer, encumbrance, attachment, garnishment or other disposition.
(c) Awards under this Plan shall not constitute compensation for the
purpose of determining participation or benefits under any other plan of the
Company unless specifically included as compensation in such plan.
(d) The Company shall have the right to deduct from Awards any taxes or
other amounts required to be withheld by law.
(e) All questions pertaining to the construction, regulation, validity and
effect of the provisions of the Plan shall be determined in accordance with the
laws of the State of Delaware without regard to its principles of conflict of
laws.
(f) If any provision of this Plan would cause Awards not to constitute
"qualified performance-based compensation" under Section 162(m) of the Code,
that provision shall be severed from, and shall be deemed not to be a part of,
the Plan, but the other provisions hereof shall remain in full force and effect.
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(g) No member of the Committee or the Board, and no officer, employee or
agent of the Company shall be liable for any act or action hereunder, whether of
commission or omission, taken by any other member, or by any officer, agent or
employee, or, except in circumstances involving bad faith, for anything done or
omitted to be done in the administration of the Plan.
9. EFFECTIVE DATE
The Plan shall be effective as of January 1, 2003, subject to approval by
the stockholders of the Company in accordance with Section 162(m) of the Code.
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