Exhibit
10.1
KELLOGG
COMPANY 2009 LONG-TERM INCENTIVE PLAN
1.
PURPOSE
. The purpose of the 2009 Long-Term
Incentive Plan is to further and promote the interests of
Kellogg Company, its Subsidiaries and its shareowners by
enabling the Company and its Subsidiaries to attract, retain and
motivate employees and officers or those who will become
employees or officers, and to align the interests of those
individuals and the Company’s shareowners. To do this, the
Plan offers performance-based incentive awards and equity-based
opportunities providing such employees and officers with a
proprietary interest in maximizing the growth, profitability and
overall success of the Company and its Subsidiaries.
2.
DEFINITIONS
. Unless the context clearly
indicates otherwise, for purposes of the Plan, the following
terms shall have the following meanings:
2.1.
“10% Shareowner”
has the
meaning set forth in Section 6.2.
2.2.
“Award”
means an award or
grant made to a Participant under Sections 6, 7, 8
and/or
9 of
the Plan.
2.3.
“Award Agreement”
means the
written agreement executed by a Participant pursuant to
Sections 3.2 and 16.7 of the Plan in connection with the
granting of an Award.
2.4.
“Base Value”
has the meaning
set forth in Section 7.2.
2.5.
“Board”
means the Board of
Directors of the Company, as constituted from time to time.
2.6.
“Change in Control”
has the
meaning set forth in Section 14.2.
2.7.
“Change in Control Price”
has
the meaning set forth in Section 13.3
2.8.
“Code”
means the Internal
Revenue Code of 1986, as in effect and as amended from time to
time, or any successor statute thereto, together with any rules,
regulations and interpretations promulgated thereunder or with
respect thereto.
2.9.
“Collective Awards”
means
Awards together with any awards issued under Old Plans as of the
Effective Date.
2.10.
“Committee”
means the
committee of the Board designated to administer the Plan, as
described in Section 3 of the Plan.
2.11.
“Common Stock”
means the
Common Stock, par value $0.25 per share, of the Company or any
security of the Company issued by the Company in substitution or
exchange therefor.
2.12.
“Company”
means Kellogg
Company, a Delaware corporation, or any successor corporation to
Kellogg Company.
2.13.
“Covered Employee”
has the
meaning set forth in Section 9.6.
2.14.
“Director”
means a director
of the Company.
2.15.
“Disability”
means disability
as defined in the Participant’s then effective employment
agreement, or if the Participant is not then a party to an
effective employment agreement with the Company which defines
disability, “Disability” means disability as
determined by the Committee in accordance with standards and
procedures similar to those under the Company’s long-term
disability plan, if any. Subject to the first sentence of this
Section 2.15, at any time that the Company does not
maintain a long-term disability plan, “Disability”
shall mean any physical or mental disability which is determined
to be total and permanent by a physician selected in good faith
by the Company. Notwithstanding the foregoing, for purposes of
Incentive Stock Options “Disability” shall mean a
permanent and total disability as defined in
Section 22(e)(3) of the Code, and for purposes of any Award
that is subject to Section 409A of the Code,
“Disability” shall mean that a Participant is
“disabled” under Section 409A(a)(2)(c)(i) or
(ii) of the Code.
2.16.
“Effective Date”
has the
meaning set forth in Section 16.11.
2.17.
“Exchange Act”
means the
Securities Exchange Act of 1934, as in effect and as amended
from time to time, or any successor statute thereto, together
with any rules, regulations and interpretations promulgated
thereunder or with respect thereto.
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2.18.
“Exercise Value”
has the
meaning set forth in Section 7.2.
2.19.
“Fair Market Value”
on any
date means (a) the officially quoted closing price in the
primary trading session for a share of the Common Stock on the
New York Stock Exchange-Composite Transactions Tape or on any
other stock exchange, if any, on which the Common Stock is
primarily traded (or if no shares of the Common Stock were
traded on such date, then on the most recent previous date on
which any shares of the Common Stock were so traded), or
(b) if clause (a) is not applicable, the value of a
share of the Common Stock for such date as established by the
Committee, using any reasonable method of valuation consistent
with the requirements of Section 409A of the Code.
2.20.
“Incentive Stock Option”
means any stock option granted pursuant to the
provisions of Section 6 of the Plan (and the relevant Award
Agreement) that is intended to be (and is specifically
designated as) an “incentive stock option” within the
meaning of Section 422 of the Code.
2.21.
“Incumbent Board”
has the
meaning set forth in Section 14.2.
2.22.
“Merger Event”
has the
meaning set forth in Section 13.3.
2.23.
“Net Exercise”
means a
Participant’s ability to exercise a Stock Option by
directing the Company to deduct from the shares of Common Stock
issuable upon exercise of his or her Stock Option a number of
shares of Common Stock having an aggregate Fair Market Value
equal to the sum of the aggregate exercise price therefor plus
the amount of the Participant’s minimum tax withholding (if
any), whereupon the Company shall issue to the Participant the
net remaining number of shares of Common Stock after such
deductions.
2.24.
“Non-Employee Director”
means
a director of the Company who is a “nonemployee
director” within the meaning of
Rule 16b-3
promulgated under the Exchange Act.
2.25.
“Non-Qualified Stock Option”
means any Stock Option granted pursuant to the
provisions of Section 6 of the Plan (and the relevant Award
Agreement) that is not an Incentive Stock Option.
2.26.
“Old Plans
” means the Kellogg
Company 2001 Long-Term Incentive Plan and the Kellogg Company
2003 Long-Term Incentive Plan.
2.27.
“Outside Director”
means a
director of the Company who is an “outside director”
within the meaning of Section 162(m) of the Code.
2.28.
“Outstanding Company Common Stock”
has the meaning set forth in Section 14.2.
2.29.
“Outstanding Company Voting
Securities”
has the meaning set forth in
Section 14.2.
2.30.
“Participant”
means any
individual who is selected from time to time under
Section 5 to receive an Award under the Plan.
2.31.
“Performance-Based Compensation”
means any Award that is intended to constitute
“performance-based compensation” within the meaning of
Code Section 162(m)(4)(C).
2.32.
“Performance Share Unit” or
“Performance Share”
means an Award granted
pursuant to the provisions of Section 9 of the Plan and the
relevant Award Agreement, or a Restricted Share Unit or
Restricted Share intended to be
Performance-Based
Compensation.
2.33.
“Performance Unit”
means an
Award granted pursuant to the provisions of Section 9 of
the Plan and the relevant Award Agreement.
2.34.
“Person”
has the meaning set
forth in Section 14.2.
2.35.
“Plan”
means this Kellogg
Company 2009 Long-Term Incentive Plan, as set forth herein and
as in effect and as amended from time to time (together with any
rules and regulations promulgated by the Committee with respect
thereto).
2.36.
“Restricted Shares”
means an
Award of restricted shares of Common Stock granted pursuant to
the provisions of Section 8 of the Plan and the relevant
Award Agreement.
2.37.
“Restricted Share Units”
means an Award granted pursuant to the provisions of
Section 8 of the Plan and the relevant Award Agreement.
2.38.
“Restriction Period”
has the
meaning set forth in Section 8.3.
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2.39.
“Retirement”
means the
voluntary termination by the Participant from active employment
with the Company and its Subsidiaries on or after the attainment
of normal retirement age under Company-sponsored pension or
retirement plans, or any other age with the consent of the
Committee.
2.40.
“Section 16 Officer”
means an “officer” as such term is defined in
Rule 16a-1(f)
of the Exchange Act.
2.41.
“Stock Appreciation Right”
means an Award described in Section 7.2 of the Plan
and granted pursuant to the provisions of Section 7 of the
Plan.
2.42.
“Stock Option”
means a
Non-Qualified Stock Option or an Incentive Stock Option.
2.43.
“Subsidiary(ies)”
means any
corporation or other entity of which outstanding shares or
ownership interests representing 50% or more of the combined
voting power of such corporation or other entity entitled to
elect the management thereof, or such lesser percentage as may
be approved by the Committee, are owned directly or indirectly
by the Company. Notwithstanding the foregoing, for purposes of
Incentive Stock Options, “Subsidiary” means any
subsidiary corporation of the Company within the meaning of
Section 424(f) of the Code.
3.
ADMINISTRATION
.
3.1.
The Committee.
The Plan shall be
administered by the Compensation Committee of the Board, as
constituted from time to time. The Committee shall consist of
two or more non-employee directors, each of whom shall be
(i) a “non-employee director” as defined in
Rule 16b-3
of the Exchange Act; (ii) to the extent required by
Section 162(m) of the Code, an “outside director”
as defined under Section 162(m) of the Code; and
(iii) an “independent director” as defined under
Section 303A of the Listed Company Manual of the New York
Stock Exchange or such other applicable stock exchange rule. To
the extent no Committee exists that has the authority to
administer this Plan, the functions of the Committee shall be
exercised by the Board. If for any reason the appointed
Committee does not meet the requirements of
Rule 16b-3
of the Exchange Act, Section 162(m) of the Code or
Section 303A of the Listed Company Manual, such
noncompliance shall not affect the validity of Awards, grants,
interpretations or other actions of the Committee.
3.2.
Plan Administration and Plan Rules.
The Committee is authorized to construe and interpret
the Plan and to promulgate, amend and rescind rules and
regulations relating to the implementation, administration and
maintenance of the Plan. Subject to the terms and conditions of
the Plan, the Committee shall make all determinations necessary
or advisable for the implementation, administration and
maintenance of the Plan including, without limitation,
(a) selecting the Plan’s Participants, (b) making
Awards in such amounts and form as the Committee shall
determine, (c) imposing such restrictions, terms and
conditions upon such Awards as the Committee shall deem
appropriate, and (d) correcting any technical defect(s) or
technical omission(s), or reconciling any technical
inconsistency(ies), in the Plan
and/or
any
Award Agreement. Subject to applicable law, the Committee may
designate persons other than members of the Committee to carry
out the day-to-day ministerial administration of the Plan under
such conditions and limitations as it may prescribe. Subject to
the requirements of Section 157(c) of the Delaware General
Corporation Law (or any successor statute), the Committee may,
in its sole discretion, delegate its authority to one or more
senior executive officers for the purpose of making Awards to
Participants who are not Section 16 Officers, but no
officer of the Company shall have the authority to grant Awards
to himself or herself. Any such delegation shall be made by
resolution of the Board and such resolution shall set forth the
total number of shares of Common Stock that may be subject to
Awards granted pursuant to such delegation. The Committee’s
determinations under the Plan need not be uniform and may be
made selectively among Participants, whether or not such
Participants are similarly situated. Any determination, decision
or action of the Committee in connection with the construction,
interpretation, administration, implementation or maintenance of
the Plan shall be final, conclusive and binding upon all
Participants and any person(s) claiming under or through any
Participants. The Company shall effect the granting of Awards
under the Plan, in accordance with the determinations made by
the Committee, by execution of Award Agreements in such form as
is approved by the Committee.
3.3.
Liability Limitation.
Neither the
Board, the Committee, nor any member of either, or any of their
designees, shall be liable for any act, omission,
interpretation, construction or determination made in good faith
in connection with the Plan (or any Award Agreement) or any
transaction hereunder, and the members of the Board and the
Committee shall be entitled to indemnification and reimbursement
by the Company in respect of any claim, loss, damage or expense
(including, without limitation, attorneys’ fees) arising or
resulting therefrom to the fullest extent permitted by law
and/or
under
any directors and officers liability insurance coverage which
may be in effect from time to time.
4.
TERM OF PLAN/COMMON STOCK SUBJECT TO PLAN
.
4.1.
Limitations for Incentive Stock Options.
Incentive Stock Options may not be granted following
February 19, 2019, which is the ten-year anniversary of the
Board’s adoption of the Plan. The maximum number of shares
of Common
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Stock that may be issued pursuant to the grant of Incentive
Stock Options under the Plan shall be 27,000,000 shares (as
may be adjusted pursuant to Section 13.2), without regard
to the provisions of Section 4.2(ii).
4.2.
Limitations for Common Stock.
(i) The maximum number of shares of Common Stock in respect
of which Awards may be granted or paid out under the Plan,
subject to adjustment as provided in this Section,
Section 4.3 and Section 13.2 of the Plan, shall not
exceed 27,000,000 shares,
plus
the aggregate number
of shares of Common Stock described in Section 4.2(ii).
(ii) Any shares of Common Stock that are subject to
Collective Awards that expire or lapse or are forfeited,
surrendered, cancelled, terminated or settled in cash in lieu of
Common Stock shall again be available for Awards under the Plan
to the extent of such expiration, forfeiture, surrender,
cancellation, termination or settlement of such Collective
Awards (as may be adjusted pursuant to Section 13.2).
Shares of Common Stock that as of the Effective Date have not
been issued under the Old Plans, and are not covered by
outstanding awards under the Old Plans granted on or before the
Effective Date, shall not be available for Awards under the Plan.
(iii) Common Stock which may be issued under the Plan may
be either authorized and unissued shares or issued shares which
have been reacquired by the Company (in the open-market or in
private transactions) and which are being held as treasury
shares. No fractional shares of Common Stock shall be issued
under the Plan, and the Committee shall determine the manner in
which fractional share value shall be treated.
(iv) In the event of a change in the Common Stock of the
Company that is limited to a change in the designation thereof
to “Capital Stock” or other similar designation, or to
a change in the par value thereof, or from par value to no par
value, without increase or decrease in the number of issued
shares, the shares resulting from any such change shall be
deemed to be the Common Stock for purposes of the Plan.
(v) The maximum number of shares of Common Stock that may
be issued pursuant to the grant of Awards (other than Stock
Options and Stock Appreciation Rights) under the Plan shall not
exceed 5,000,000 shares (as may be adjusted pursuant to
Section 13.2).
4.3.
Computation of Available Shares.
(i) For the purpose of computing the total number of shares
of Common Stock available for Awards under the Plan, there shall
be counted against the limitations set forth in Section 4.2
of the Plan (subject to the remainder of this Section and
Section 13.2) the maximum number of shares of Common Stock
issued upon exercise or settlement of Awards granted under
Sections 6 and 7 of the Plan and the number of shares of
Common Stock issued under grants of Restricted Shares,
Restricted Share Units and Performance Share Units pursuant to
Sections 8 and 9 of the Plan, in each case determined as of
the date on which such Awards are issued.
(ii) If a Stock Appreciation Right is settled, in part or
in whole, through the issuance of shares of Common Stock or
Restricted Shares, then all shares that were covered by the
exercised Stock Appreciation Right shall not again be available
for issuance under the Plan.
(iii) If the exercise price of any Award is paid by tender
to the Company, or attestation to the ownership, of shares of
Common Stock owned by the Participant, or by means of a Net
Exercise, the number of shares of Common Stock available for
issuance under the Plan shall be reduced by the gross number of
shares of Common Stock for which the Award is exercised.
(iv) Shares of Common Stock withheld or deducted by the
Company for tax withholding obligations pursuant to
Section 16.1 shall not again be available for issuance
under the Plan.
(v) Shares of Common Stock repurchased on the open market
with the proceeds from the exercise of an Award shall not be
added to the shares of Common Stock available for Awards under
this Plan.
4.4.
Maximum Yearly Awards.
The maximum
annual Common Stock amounts in this Section 4.4 are subject
to adjustment under Section 13.2 and are subject to the
Plan maximum determined pursuant to Sections 4.2 and 4.3.
4.4.1
Stock Options and Stock Appreciation Rights.
The maximum number of shares of Common Stock that may be
subject to Awards of Stock Options or Stock Appreciation Rights
to any Participant in any calendar year under the Plan shall not
exceed 2,000,000 shares of Common Stock.
4.4.2
Restricted Shares and Restricted Share Units.
There is no annual individual share limitation for
Awards of Restricted Shares or Restricted Share Units which are
not intended to be Performance-Based Compensation.
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4.4.3
Performance Share Units
. The maximum
number of shares of Common Stock that may be subject to
Performance Share Units granted to any Participant in any
calendar year under the Plan shall not exceed
1,000,000 shares of Common Stock.
4.4.4
Performance Units
. The maximum cash
amount payable under any Performance Unit intended to be
Performance-Based Compensation to any Participant for any
calendar year shall be $10 million.
4.5.
Minimum Purchase Price.
Notwithstanding any provision of the Plan to the
contrary, if authorized but previously unissued shares of Common
Stock are issued under the Plan, such shares shall not be issued
for consideration that is less than as permitted under
applicable law.
5.
ELIGIBILITY
.
Individuals eligible for
Awards under the Plan shall consist of employees, officers and
directors, or those who will become employees, officers or
directors, of the Company
and/or
its
Subsidiaries whose performance or contribution, in the sole
discretion of the Committee, benefits or will benefit the
Company or any Subsidiary.
6.
STOCK OPTIONS
.
6.1.
Terms and Conditions.
Stock
Options granted under the Plan shall be in respect of Common
Stock and may be in the form of Incentive Stock Options or
Non-Qualified Stock Options. Such Stock Options shall be subject
to the terms and conditions set forth in this Section 6 and
any additional terms and conditions, not inconsistent with the
express terms and provisions of the Plan, as the Committee shall
set forth in the relevant Award Agreement.
6.2.
Grant.
Stock Options may be
granted under the Plan in such form as the Committee may from
time to time approve. Stock Options may be granted alone or in
addition to other Awards under the Plan or in tandem with Stock
Appreciation Rights. Additional provisions shall apply to
Incentive Stock Options granted to any employee who owns (within
the meaning of Section 422(b)(6) of the Code) more than ten
percent (10%) of the total combined voting power of all classes
of stock of the Company or its parent corporation or any
Subsidiary of the Company, within the meaning of
Sections 424(e) and (f) of the Code (a
“10%
Shareowner”
).
6.3.
Exercise Price.
The exercise price
per share of Common Stock subject to a Stock Option shall be
determined by the Committee; provided, however, that the
exercise price of a Stock Option shall not be less than one
hundred percent (100%) of the Fair Market Value of the Common
Stock on the grant date of such Stock Option; provided, further,
however, that, in the case of a 10% Shareowner, the exercise
price of an Incentive Stock Option shall not be less than one
hundred ten percent (110%) of the Fair Market Value of the
Common Stock on the grant date.
6.4.
Term.
The term of each Stock
Option shall be such period of time as is fixed by the
Committee; provided, however, that the term of any Stock Option
shall not exceed ten (10) years (five (5) years, in
the case of a 10% Shareowner receiving an Incentive Stock
Option) after the date immediately preceding the date on which
the Stock Option is granted.
6.5.
Method of Exercise.
A Stock Option
may be exercised, in whole or in part, by giving written notice
of exercise to the Secretary of the Company, or the
Secretary’s designee, specifying the number of shares to be
purchased. Such notice shall be accompanied by payment in full
of the exercise price. The methods of payment permitted by this
Plan for payment in full of the aggregate exercise price of a
Stock Option are as follows: (i) by cash, certified check,
bank draft, electronic transfer, or money order payable to the
order of the Company, (ii) if permitted by the Committee in
its sole discretion, by surrendering (or attesting to the
ownership of) shares of Common Stock already owned by the
Participant, (iii) pursuant to a Net Exercise arrangement;
provided, however,
that in such event, the Committee may
exercise its discretion to limit the use of a Net Exercise
solely with respect to the portion of such payment required to
be made with respect to tax withholding, or (iv) if
permitted by the Committee (in its sole discretion) and
applicable law, by delivery of, alone or in conjunction with a
partial cash or instrument payment, some other form of payment
acceptable to the Committee. Payment instruments shall be
received by the Company subject to collection. The proceeds
received by the Company upon exercise of any Stock Option may be
used by the Company for general corporate purposes. Any portion
of a Stock Option that is exercised may not be exercised again.
The shares issued to an optionee for the portion of any Stock
Option exercised by attesting to the ownership of shares shall
not exceed the number of shares issuable as a result of such
exercise (determined as though payment in full therefor were
being made in cash) less the number of shares for which
attestation of ownership is submitted. The value of owned shares
submitted (directly or by attestation) in full or partial
payment for the shares purchased upon exercise of a Stock Option
shall be equal to the aggregate Fair Market Value of such owned
shares on the date of the exercise of such Stock Option.
6.6.
Exercisability.
Any Stock Option
granted under the Plan shall become exercisable on such date or
dates, or based on the attainment of such performance goals, as
determined by the Committee (in its sole discretion) at any time
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and from time to time in respect of such Stock Option, and as
set forth in the applicable Award Agreement. Notwithstanding
anything to the contrary contained in this Section 6.6,
unless otherwise provided in an Award Agreement, such Stock
Option shall become one hundred percent (100%) vested and
exercisable as to the aggregate number of shares of Common Stock
underlying such Stock Option upon the death, Disability or
Retirement of the Participant.
6.7.
Tandem Grants.
If Non-Qualified
Stock Options and Stock Appreciation Rights are granted in
tandem, as designated in the relevant Award Agreements, the
right of a Participant to exercise any such tandem Stock Option
shall terminate to the extent that the shares of Common Stock
subject to such Stock Option are used to calculate amounts or
shares receivable upon the exercise of the related tandem Stock
Appreciation Right.
6.8.
No Reload Provision.
Stock Options
granted under this Plan shall not contain any provision
entitling the optionee to the automatic grant of additional
Stock Options in connection with any exercise of the original
Stock Option.
7.
STOCK APPRECIATION RIGHTS
.
7.1.
Terms and Conditions.
The grant of
Stock Appreciation Rights under the Plan shall be subject to the
terms and conditions set forth in this Section 7 and any
additional terms and conditions, not inconsistent with the
express terms and provisions of the Plan, as the Committee shall
set forth in the relevant Award Agreement.
7.2.
Stock Appreciation Rights.
A Stock
Appreciation Right is an Award granted with respect to a
specified number of shares of Common Stock, as shall be
determined by the Committee, entitling a Participant to receive
an amount equal to the excess of the Fair Market Value of a
share of Common Stock on the date of exercise (the
“Exercise Value”
) over the Fair Market
Value of a share of Common Stock on the grant date of the Stock
Appreciation Right (the
“Base Value”
),
multiplied by the number of shares of Common Stock with respect
to which the Stock Appreciation Right shall have been exercised.
In the case of a Stock Appreciation Right related to a Stock
Option described in Section 6.7, the Base Value shall be
the purchase price of a share of Common Stock under the Stock
Option, provided, however, such amount may not be less than the
Fair Market Value of the Common Stock on the date the Stock
Appreciation Right is awarded. The Base Value of a Stock
Appreciation Right shall not be less than one hundred percent
(100%) of the Fair Market Value of the Common Stock on the grant
date of such Stock Appreciation Right.
7.3.
Grant.
A Stock Appreciation Right
may be granted in addition to any other Award under the Plan or
in tandem with or independent of a Non-Qualified Stock Option.
7.4.
Term.
The term of each Stock
Appreciation Right shall be such period of time as is fixed by
the Committee; provided, however, that the term of any Stock
Appreciation Right shall not exceed ten (10) years after
the date immediately preceding the date on which the Stock
Appreciation Right is granted.
7.5.
Date of Exercisability.
In respect
of any Stock Appreciation Right granted under the Plan, unless
otherwise (a) determined by the Committee (in its sole
discretion) at any time and from time to time in respect of any
such Stock Appreciation Right, or (b) provided in the Award
Agreement, a Stock Appreciation Right may be exercised by a
Participant, in accordance with and subject to all of the
procedures established by the Committee, in whole or in part at
such time or times
and/or
based
on the achievement of such performance goals as determined by
the Committee in its sole discretion. Notwithstanding the
preceding sentence, in no event shall a Stock Appreciation Right
be exercisable prior to the exercisability of any Non-Qualified
Stock Option with which it is granted in tandem. The Committee
may also provide, as set forth in the relevant Award Agreement
and without limitation, that some Stock Appreciation Rights
shall be automatically exercised and settled on one or more
fixed dates specified therein by the Committee.
7.6.
Form of Payment.
Upon exercise of
a Stock Appreciation Right, payment may be made to the
Participant in respect thereof in cash, in Restricted Shares or
in shares of unrestricted Common Stock, or in any combination
thereof, as the Committee, in its sole discretion, shall
determine and provide in the relevant Award Agreement.
7.7.
Tandem Grant.
The right of a
Participant to exercise a tandem Stock Appreciation Right shall
terminate to the extent such Participant exercises the
Non-Qualified Stock Option to which such Stock Appreciation
Right is related.
8.
RESTRICTED SHARES AND RESTRICTED SHARE
UNITS
.
8.1.
Restricted Share and Restricted Share Unit
Grants.
A grant of Restricted Shares is an Award of
shares of Common Stock granted to a Participant, subject to such
restrictions, terms and conditions as the Committee deems
appropriate, including, without limitation,
(a) restrictions on the sale, assignment, transfer,
hypothecation or other disposition of such shares, (b) the
requirement that the Participant deposit such shares with the
Company while such shares are subject to such restrictions, and
(c) the requirement that such shares be forfeited upon
termination of employment for specified reasons within a
specified period of time or for other reasons (including,
without limitation, the
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failure to achieve designated performance goals). A grant of
Restricted Share Units is a notional Award of shares of Common
Stock which entitle the Participant to a number of unrestricted
shares of Common Stock equal to (or a cash amount equal in value
to such number of unrestricted shares of Common Stock) the
number of Restricted Share Units upon the lapse of similar
restrictions, terms and conditions.
8.2.
Terms and Conditions.
Grants of
Restricted Shares and Restricted Share Units shall be subject to
the terms and conditions set forth in this Section 8 and
any additional terms and conditions, not inconsistent with the
express terms and provisions of the Plan, as the Committee shall
set forth in the relevant Award Agreement. Restricted Shares and
Restricted Share Units may be granted alone or in addition to
any other Awards under the Plan. Subject to the terms of the
Plan, the Committee shall determine the number of Restricted
Shares and Restricted Share Units to be granted to a Participant
and the Committee may provide or impose different terms and
conditions on any particular Restricted Share or Restricted
Share Units grant made to any Participant. With respect to each
Participant receiving an Award of Restricted Shares, there shall
be issued a stock certificate (or certificates) in respect of
such Restricted Shares. Such stock certificate(s) shall be
registered in the name of such Participant, shall be accompanied
by a stock power duly executed by such Participant, and shall
bear, among other required legends, the following legend:
“The transferability of this certificate and the shares of
stock represented hereby are subject to the terms and conditions
(including, without limitation, forfeiture events) contained in
the Kellogg Company 2009 Long-Term Incentive Plan and an Award
Agreement entered into between the registered owner hereof and
Kellogg Company. Copies of such Plan and Award Agreement are on
file in the office of the Secretary of Kellogg Company, One
Kellogg Square, Battle Creek, MI 49016. Kellogg Company will
furnish to the recordholder of the certificate, without charge
and upon written request at its principal place of business, a
copy of such Plan and Award Agreement. Kellogg Company reserves
the right to refuse to record the transfer of this certificate
until all such restrictions are satisfied, all such terms are
complied with and all such conditions are satisfied.”
Such stock certificate evidencing such shares shall, in the sole
discretion of the Committee, be deposited with and held in
custody by the Company until the restrictions thereon shall have
lapsed and all of the terms and conditions applicable to such
grant shall have been satisfied. With respect to each
Participant receiving an Award of Restricted Share Units that is
settled in shares of Common Stock, there shall be issued a stock
certificate (or certificates) in respect of the underlying
shares of Common Stock upon the lapse of the restrictions
associated with such Restricted Share Units.
8.3.
Restriction Period.
In accordance
with Sections 8.1 and 8.2 of the Plan and unless otherwise
determined by the Committee (in its sole discretion) at any time
and from time to time, Restricted Shares and Restricted Share
Units shall only become unrestricted and vested in accordance
with the vesting schedule relating to such Restricted Shares and
Restricted Share Units, if any, as the Committee may establish
in the relevant Award Agreement, which may be based on the lapse
of a specified time period or periods or on the attainment of
specified performance goals (the
“Restriction
Period”
). During the Restriction Period, such
Restricted Shares and the underlying shares of Common Stock with
respect to the Restricted Share Units shall be and remain
unvested and a Participant may not sell, assign, transfer,
pledge, encumber or otherwise dispose of or hypothecate such
Award. Upon satisfaction of the vesting schedule and any other
applicable restrictions, terms and conditions, the Participant
shall be entitled to receive payment of the Restricted Shares or
a portion thereof, as the case may be, as provided in
Section 8.4 of the Plan. Restricted Share Units may be paid
in cash, shares of Common Stock or any combination thereof, as
determined by the Committee. To the extent that any Restricted
Share Award or Restricted Share Unit Award is intended to be
Performance-Based Compensation, such award shall be subject to
the provisions of Sections 9.4, 9.6 and 9.7, and the
certification requirements contained in Section 9.5.
8.4.
Payment of Restricted Share and Restricted
Share Unit Grants.
After the satisfaction
and/or
lapse
of the restrictions, terms and conditions established by the
Committee in respect of a grant of Restricted Shares, a new or
additional certificate, without the legend set forth in
Section 8.2 of the Plan, for the number of shares of Common
Stock which are no longer subject (or deemed subject) to such
restrictions, terms and conditions shall, as soon as practicable
thereafter, be delivered to the Participant. Restricted Share
Units may be paid or settled in cash or in shares of Common
Stock, or in combination thereof, as the Committee, in its sole
discretion, shall determine and provide in the relevant Award
Agreement.
8.5.
Shareowner Rights.
A Participant
shall have, with respect to the shares of Common Stock
underlying a grant of Restricted Shares (but not under
Restricted Share Units), all of the rights of a shareowner of
such shares (except as such rights are limited or restricted
under the Plan or in the relevant Award Agreement).
7
9.
PERFORMANCE UNITS AND PERFORMANCE SHARE
UNITS
.
9.1.
Terms and Conditions.
Performance
Units and Performance Share Units shall be subject to the terms
and conditions set forth in this Section 9 and any
additional terms and conditions, not inconsistent with the
express provisions of the Plan, as the Committee shall set forth
in the relevant Award Agreement.
9.2.
Performance Unit and Performance Share
Unit Grants.
A grant of Performance Units is a notional
Award of units (with each unit representing such monetary amount
or value as is designated by the Committee in the Award
Agreement) granted to a Participant, subject to such terms and
conditions as the Committee deems appropriate, including,
without limitation, the requirement that the Participant forfeit
such units (or a portion thereof) in the event certain
performance criteria or other conditions are not met within a
designated period of time. A grant of Performance Share Units is
an Award of actual or notional shares of Common Stock which
entitle the Participant to a number of shares of Common Stock
equal to the number of Performance Share Units upon achievement
of specified performance goals and such other terms and
conditions as the Committee deems appropriate.
9.3.
Grants.
Performance Units and
Performance Share Units may be granted alone or in addition to
any other Awards under the Plan. Subject to the terms of the
Plan, the Committee shall determine the number of Performance
Units and Performance Share Units to be granted to a Participant
and the Committee may impose different terms and conditions on
any particular Performance Units and Performance Share Units
granted to any Participant.
9.4.
Performance Goals and Performance Periods.
Participants receiving a grant of Performance Units and
Performance Share Units shall be entitled to payment in respect
of such Awards if the Company
and/or
the
Participant achieves specified performance goals (the
“Performance Goals”
) during and in
respect of a designated performance period (the
“Performance Period”
). The Performance
Goals and the Performance Period shall be established in writing
by the Committee, in its sole discretion. The Committee shall
establish Performance Goals for each Performance Period prior
to, or as soon as practicable after, the commencement of such
Performance Period (and, in any event, no later than ninety
(90) days after the commencement of the Performance Period
or such other period required by applicable law). At the time of
the granting of Performance Units and Performance Share Units
which are intended to constitute Performance-Based Compensation,
or at any time thereafter, in either case to the extent
permitted under Section 162(m) of the Code without
adversely affecting the treatment of the Award as
Performance-Based Compensation, the Committee may provide for
the manner in which performance will be measured against the
Performance Goals (or may adjust the Performance Goals) to
reflect the impact of specified corporate transactions,
accounting or tax law changes and other extraordinary or
nonrecurring events. The Committee shall also establish a
schedule or schedules for Performance Units and Performance
Share Units setting forth the portion of the Award which will be
earned or forfeited based on the degree of achievement, or lack
thereof, of the Performance Goals at the end of the relevant
Performance Period. In setting Performance Goals, the Committee
may use, but shall not be limited to, such measures as total
shareowner return, return on equity, net earnings growth, sales
or revenue growth, cash flow, or such other measure or measures
of performance as the Committee, in its sole discretion, may
deem appropriate (which may include those measures set forth in
Section 9.6). Such performance measures shall be defined as
to their respective components and meaning by the Committee (in
its sole discretion) and may be based on the attainment of
specified levels of Company (or Subsidiary, division, or other
operational or administrative department of the Company)
performance relative to the performance of other corporations or
based on individual participant Performance Goals.
9.5.
Payment of Units.
With respect to
each Performance Unit and Performance Share Unit, the
Participant shall, if the applicable Performance Goals have been
achieved, or partially achieved, as determined by the Committee
in its sole discretion, by the Company
and/or
the
Participant during the relevant Performance Period, be entitled
to receive payment in an amount equal to the designated value of
each Performance Unit and Performance Share Unit times the
number of such units so earned. Prior to the vesting, payment,
settlement or lapsing of any restrictions with respect to any
Performance Unit and Performance Share Unit that is intended to
constitute Performance-Based Compensation made to a Participant
who is subject to Section 162(m) of the Code, the Committee
shall certify in writing that the applicable Performance Goals
have been satisfied to the extent necessary for such Award to
qualify as Performance-Based Compensation. Payment in settlement
of earned Performance Units shall be made in cash as soon as
practicable in the calendar year following the conclusion of the
respective Performance Period. Payment in settlement of earned
Performance Share Units shall be made in unrestricted Common
Stock or in Restricted Shares, or any combination thereof, as
the Committee in its sole discretion shall determine and provide
in the relevant Award Agreement, and in any case as soon as
practicable in the calendar year following the conclusion of the
respective Performance Period.
9.6.
Performance-Based Awards.
Performance Units, Performance Share Units, Restricted
Shares, and Restricted Share Units and other Awards subject to
performance criteria that are intended to be Performance-Based
Compensation
8
shall be paid solely on account of the attainment of one or more
pre-established, objective Performance Goals within the meaning
of Section 162(m) and the regulations thereunder. Until
otherwise determined by the Committee, the Performance Goals
shall be the attainment of pre-established levels of (or
pre-established changes or improvements in) any of net sales,
net income, market price per share, earnings per share, return
on equity, return on capital employed, return on invested
capital, cash flow, discounted cash flow, cumulative cash flow,
operating profit, gross or pre-tax profits, post-tax profits,
gross or net margins, consolidated net income, unit sales
volume, economic value added, costs or cost reduction
initiatives, production, unit production volume, improvements in
financial ratings, regulatory compliance, achievement of balance
sheet or income statement objectives, market or category share,
organizational objectives (including diversity, safety and
K-values), productivity initiatives, acquisition integration,
total return to shareowners (including both the market value of
the Company’s stock and dividends thereon) or any other
performance measure the Committee deems appropriate. Performance
Goals may be in respect of the performance of the Company, any
of its Subsidiaries or affiliates or any combination thereof on
either a consolidated, business unit or divisional level.
Performance Goals may be absolute or relative (to prior
performance of the Company or to the performance of one or more
other entities or external indices) and may be expressed in
terms of a progression within a specified range. The payout of
any such Award to a Covered Employee may be reduced, but not
increased, based on the degree of attainment of other
performance criteria or otherwise at the discretion of the
Committee. For purposes of the Plan,
“Covered
Employee”
has the same meaning as set forth in
Section 162(m) of the Code.
9.7.
Termination of Employment.
If the
Participant ceases to be an employee before the end of any
Performance Period due to the Participant’s death,
Retirement or Disability before the end of any Performance
Period, such Participant (or the Participant’s legal
representative or designated beneficiary) shall receive all of
the amount which would have been paid to the Participant had the
Participant continued as an employee to the end of the
Performance Period, payable at the same time as it would
otherwise would have been paid in the absence of any such
termination. Unless otherwise determined by the Committee, if a
Participant ceases to be an employee for any other reason, any
unpaid amounts for outstanding Performance Periods shall be
forfeited.
10.
DEFERRAL ELECTIONS/TAX REIMBURSEMENTS
.
The Committee may permit or require a Participant to elect to
defer receipt of any payment of cash or any delivery of shares
of Common Stock or other item that would otherwise be due to
such Participant by virtue of the exercise, settlement or
payment of any Award made under the Plan. If any such election
is permitted or required, the Committee may impose any
restrictions it deems to be necessary or appropriate with
respect to (i) any deferral election made with respect to
an Award under the Plan and (ii) the timing of the payment
of any deferred amounts, in each case, in order to cause such
deferral election and payment timing to comply with the
requirements of Section 409A(a) of the Code. The Committee
may also provide in the relevant Award Agreement for a tax
reimbursement payment to be made by the Company in cash in favor
of any Participant in connection with the tax consequences
resulting from the grant, exercise, settlement, or payment of
any Award made under the Plan.
11.
DIVIDEND AND DIVIDEND EQUIVALENTS
.
As
specified in the relevant Award Agreement, the Committee may
provide that Awards (other than Stock Options, Stock
Appreciation Rights and unvested Performance Share Units)
denominated in shares earn dividends or dividend equivalents.
Dividends or any such dividend equivalents may be paid currently
in cash or shares of Common Stock or may be credited to an
account established by the Committee under the Plan in the name
of the Participant. To the extent that such Dividends or
dividend equivalents are credited to an account and are not paid
currently, such credited amounts shall be paid at such time or
times as determined by the Committee and set forth in an Award
Agreement consistent with the requirements of Section 409A
of the Code. Any crediting of dividends or dividend equivalents
may be subject to such restrictions and conditions as the
Committee may establish, including reinvestment in additional
shares or share equivalents. Any stock dividends paid in respect
of unvested Restricted Shares or unvested Restricted Share Units
shall be treated as additional Restricted Shares or Restricted
Share Units and shall be subject to the same restrictions and
other terms and conditions that apply to the unvested Restricted
Shares or unvested Restricted Share Units in respect of which
such stock dividends are issued.
12.
NON-TRANSFERABILITY OF AWARDS
.
Except as
provided below, no Award under the Plan or any Award Agreement,
and no rights or interests herein or therein, shall or may be
assigned, transferred, sold, exchanged, encumbered, pledged, or
otherwise hypothecated or disposed of by a Participant or any
beneficiary(ies) of any Participant, except by testamentary
disposition by the Participant or the laws of intestate
succession. No such interest shall be subject to execution,
attachment or similar legal process, including, without
limitation, seizure for the payment of the Participant’s
debts, judgments, alimony, or separate maintenance. Except as
provided below, during the lifetime of a Participant, Stock
Options and Stock Appreciation Rights are exercisable only by
the Participant or his or her legal representative.
Notwithstanding the foregoing, the Committee may from time to
time permit Awards to be transferable to “family
members” (within the meaning of the General Instructions to
Form S-8)
subject to such terms and conditions as the
9
Committee may impose and applicable law;
provided, however,
no Award may be transferred for value (as defined in the
General Instructions to
Form S-8).
Any transfer contrary to this Section 12 will nullify the
Award.
13.
CHANGES IN CAPITALIZATION AND OTHER
MATTERS
.
13.1.
No Corporate Action Restriction.
The existence of the Plan, any Award Agreement
and/or
the
Awards granted hereunder shall not limit, affect or restrict in
any way the right or power of the Board or the shareowners of
the Company to make or authorize (a) any adjustment,
recapitalization, reorganization or other change in the
Company’s or any Subsidiary’s capital structure or its
business, (b) any merger, consolidation or change in the
ownership of the Company or any Subsidiary, (c) any issue
of bonds, debentures, capital, preferred or prior preference
stocks ahead of or affecting the Company’s or any
Subsidiary’s capital stock or the rights thereof,
(d) any dissolution or liquidation of the Company or any
Subsidiary, (e) any sale or transfer of all or any part of
the Company’s or any Subsidiary’s assets or business,
or (f) any other corporate act or proceeding by the Company
or any Subsidiary. No Participant, beneficiary or any other
person shall have any claim against any member of the Board or
the Committee, the Company or any Subsidiary, or any employees,
officers, shareowners or agents of the Company or any
Subsidiary, as a result of any such action.
13.2.
Recapitalization Adjustments.
In
the event of a dividend or other distribution (whether in the
form of cash, Common Stock, other securities, or other property)
other than regular cash dividends, recapitalization, stock
split, reverse stock split, reorganization, merger,
consolidation,
split-up,
spin-off, combination, Change in Control or exchange of Common
Stock or other securities of the Company, or other corporate
transaction or event affects the Common Stock such that an
adjustment is necessary or appropriate in order to prevent
dilution or enlargement of benefits or potential benefits
intended to be made available under the Plan, the Board shall
equitably adjust (i) the number of shares of Common Stock
or other securities of the Company (or number and kind of other
securities or property) with respect to which Awards may be
granted, (ii) the maximum share limitation applicable to
each type of Award that may be granted to any individual
participant in any calendar year, (iii) the number of
shares of Common Stock or other securities of the Company (or
number and kind of other securities or property) subject to
outstanding Awards, and (iv) the exercise price with
respect to any Stock Option or the Base Value with respect to
any Stock Appreciation Right.
13.3.
Mergers.
If the Company enters
into or is involved in any merger, reorganization, Change in
Control or other business combination with any person or entity
(a
“Merger Event”
), the Board may, prior
to such Merger Event and effective upon such Merger Event, take
such action as it deems appropriate, including, but not limited
to, replacing Awards with substitute Awards in respect of the
shares, other securities or other property of the surviving
corporation or any affiliate of the surviving corporation on
such terms and conditions, as to the number of shares, pricing
and otherwise, which shall substantially preserve the value,
rights and benefits of any affected Awards granted hereunder as
of the date of the consummation of the Merger Event.
Notwithstanding anything to the contrary in the Plan, if any
Merger Event or Change in Control occurs, the Company shall have
the right, but not the obligation, to cancel each
Participant’s Stock Options
and/or
Stock
Appreciation Rights and to pay to each affected Participant in
connection with the cancellation of such Participant’s
Stock Options
and/or
Stock
Appreciation Rights, an amount equal to the excess (if any) of
the Change in Control Price (as defined below), as determined by
the Board, of the Common Stock underlying any unexercised Stock
Options or Stock Appreciation Rights (whether then exercisable
or not) over the aggregate exercise price of such unexercised
Stock Options
and/or
Stock
Appreciation Rights, and make additional adjustments
and/or
settlements of other outstanding Awards as it determines to be
fair and equitable to affected Participants.
Upon receipt by any affected Participant of any such substitute
Award (or payment) as a result of any such Merger Event, such
Participant’s affected Awards for which such substitute
Awards (or payment) were received shall be thereupon cancelled
without the need for obtaining the consent of any such affected
Participant.
For purposes of the Plan,
“Change in Control
Price”
means the highest price per share of Common
Stock paid in any transaction related to a Change in Control of
the Company or a Merger Event. To the extent that the
consideration paid in any such transaction described above
consists all or in part of securities or other non-cash
consideration, the value of such securities or other non-cash
consideration shall be determined in the good-faith discretion
of the Board consistent with provisions of Section 409A of
the Code
and/or
other
applicable law.
10
14.
CHANGE IN CONTROL PROVISIONS
.
14.1.
Impact of Event.
Notwithstanding
any other provision of the Plan to the contrary and unless
otherwise determined by the Committee, prior to a Change in
Control, in the event of a Change in Control:
(i) Any Stock Options and Stock Appreciation Rights
outstanding as of the date such Change in Control is determined
to have occurred, and which are not then exercisable and vested,
shall become fully exercisable and vested;
(ii) The restrictions and deferral limitations applicable
to any Restricted Shares shall lapse, and such Restricted Shares
shall become free of all restrictions and become fully vested
and transferable;
(iii) All Performance Units shall be considered to be
earned and payable in full, and any deferral or other
restrictions shall lapse, and such Performance Units shall be
settled in cash (with the value being determined by the
Committee, in its sole discretion), and all Restricted Share
Units and Performance Share Units shall become fully vested and
payable, in each case, as promptly as is practicable on or
following the Change in Control;
provided, however,
that
in the event that the Change in Control does not constitute a
“change in the ownership or effective control,” or a
“change in the ownership of a substantial portion of the
assets,” of the Company, in each case within the meaning of
Section 409A(a)(2)(A)(v) of the Code, Performance Units,
Restricted Share Units and Performance Share Units shall not be
payable until the date such Performance Units, Restricted Share
Units and Performance Share Units would have been payable in the
absence of this Section 14.1 if the acceleration of such
payment would cause the tax consequences set forth in
Section 409A(a)(1) of the Code to apply to such Performance
Units, Restricted Share Units and Performance Share
Units; and
(iv) The Committee may also make additional adjustments
and/or
settlements of outstanding Awards as it deems appropriate and
consistent with the Plan’s purposes (including
Section 13.3).
14.2.
Definition of Change in Control.
For purposes of the Plan, a
“Change in
Control”
shall mean the happening of any of the
following events:
(i) An acquisition after the date hereof by any individual,
entity or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Exchange Act) (a
“Person”
) of beneficial ownership
(within the meaning of
Rule 13d-3
promulgated under the Exchange Act) of 20% or more of either
(a) the then outstanding shares of common stock of the
Company (the
“Outstanding Company Common
Stock”
) or (b) the combined voting power of
the then outstanding voting securities of the Company entitled
to vote generally in the election of directors (the
“Outstanding Company Voting
Securities”
); excluding, however, the following:
(1) any acquisition directly from the Company, other than
an acquisition by virtue of the exercise of a conversion
privilege unless the security being so converted was itself
acquired directly from the Company or approved by the Incumbent
Board (as defined below), (2) any increase in beneficial
ownership of a Person as a result of any acquisition by the
Company, (3) any acquisition by any employee benefit plan
(or related trust) sponsored or maintained by the Company or any
entity controlled by the Company, (4) any acquisition by an
underwriter temporarily holding Company securities pursuant to
an offering of such securities, or (5) any acquisition
pursuant to a transaction which complies with clauses (1),
(2) and (3) of subsection (iii) of this
Section 14.2; or
(ii) A change in the composition of the Board such that the
individuals who, as of the Effective Date of the Plan,
constitute the Board (such Board shall be hereinafter referred
to as the
“Incumbent Board”
) cease for
any reason to constitute at least a majority of the Board;
provided, however,
for purposes of this Section, that any
individual who becomes a member of the Board subsequent to the
Effective Date of the Plan, whose election, or nomination for
election by the Company’s shareowners, was approved by a
vote of at least a majority of those individuals who are members
of the Board and who were also members of the Incumbent Board
(or deemed to be such pursuant to this proviso), either by a
specific vote or by approval of the proxy statement of the
Company in which such person is named as a nominee for director,
without written objection to such nomination shall be considered
as though such individual were a member of the Incumbent Board;
but,
provided further,
that any such individual whose
initial assumption of office occurs as a result of either an
actual or threatened election contest with respect to the
election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person
other than the Board shall not be so considered as a member of
the Incumbent Board; or
(iii) Consummation of a reorganization, merger or
consolidation (or similar transaction), a sale or other
disposition of all or substantially all of the assets of the
Company, or the acquisition of assets or stock of another
entity; in each case, unless immediately following such
transaction (1) all or substantially all of the individuals
and
11
entities who are the beneficial owners, respectively, of the
Outstanding Company Common Stock and Outstanding Company Voting
Securities immediately prior to such transaction will
beneficially own, directly or indirectly, more than 60% of,
respectively, the outstanding shares of common stock, and the
combined voting power of the then outstanding voting securities
entitled to vote generally in the election of directors, as the
case may be, of the corporation resulting from such transaction
(including, without limitation, a corporation which as a result
of such transaction owns the Company or all or substantially all
of the Company’s assets either directly or through one or
more subsidiaries) in substantially the same proportions as
their ownership, immediately prior to such transaction, of the
Outstanding Company Common Stock and Outstanding Company Voting
Securities, as the case may be, (2) no Person (other than
the Company, any employee benefit plan (or related trust) of the
Company or such corporation resulting from such transaction)
will beneficially own, directly or indirectly, 20% or more of,
respectively, the outstanding shares of common stock of the
corporation resulting from such transaction or the combined
voting power of the outstanding voting securities of such
corporation entitled to vote generally in the election of
directors, except to the extent that such ownership existed
prior to the transaction, and (3) individuals who were
members of the Incumbent Board at the time of the Board’s
approval of the execution of the initial agreement providing for
such transaction will constitute at least a majority of the
members of the board of directors of the corporation resulting
from such transaction (including, without limitation, a
corporation which as a result of such transaction owns the
Company or all or substantially all of the Company’s assets
either directly or through one or more subsidiaries); or
(iv) The approval by the shareowners of the Company of a
complete liquidation or dissolution of the Company.
15.
AMENDMENT, SUSPENSION, AND TERMINATION
.
15.1.
In General.
The Board may suspend
or terminate the Plan (or any portion thereof) at any time and
may amend the Plan at any time and from time to time in such
respects as the Board may deem advisable to ensure that any and
all Awards conform to or otherwise reflect any change in
applicable laws or regulations, or to permit the Company or the
Participants to benefit from any change in applicable laws or
regulations, or in any other respect the Board may deem to be in
the best interests of the Company or any Subsidiary. No such
amendment, suspension or termination shall (a) subject to
Section 16.6, materially adversely affect the rights of any
Participant under any outstanding Awards, without the consent of
such Participant, (b) make any change that would disqualify
the Plan, or any other plan of the Company or any Subsidiary
intended to be so qualified, from the benefits provided under
Section 422 of the Code, or any successor provisions
thereto, or (c) except as contemplated by Section 13,
increase the number of shares available for Awards pursuant to
Section 4.2 without shareowner approval. In addition, the
Company will obtain shareowner approval of any modification of
the Plan or Awards to the extent required by applicable laws or
regulations or the regulations of any stock exchange upon which
the Common Stock is then listed that purport to
(i) materially modify the requirements as to eligibility
for participation in the Plan, (ii) allow the repurchase of
Stock Options or Stock Appreciation Rights for cash, other types
of Awards under the Plan or other property (other than in
connection with a Change in Control) or (iii) extend the
termination date of the Plan.
15.2.
No Repricing.
Except as
contemplated by Section 13, in the event of a decline in
stock price the Board may not amend the Plan or any Award
Agreement to decrease the purchase price of any outstanding
Stock Option or the Base Value of any outstanding Stock
Appreciation Right to a price less than Fair Market Value on the
date of grant, either by decreasing the exercise price of any
outstanding Stock Option or the Base Value of any outstanding
Stock Appreciation Right, or through the cancellation of
outstanding Stock Options or Stock Appreciation Rights in
connection with granting Awards at a lower exercise price or
Base Value.
15.3.
Award Agreement Modifications.
Subject to Section 15.1, the Committee may (in its
sole discretion) amend or modify at any time and from time to
time the terms and provisions of any outstanding Stock Options,
Stock Appreciation Rights, Performance Units, Performance Share
Units, Restricted Share Units, or Restricted Share grants, in
any manner to the extent that the Committee under the Plan or
any Award Agreement could have initially determined the
restrictions, terms and provisions of such Stock Options, Stock
Appreciation Rights, Performance Units, Performance Share Units,
Restricted Share Units
and/or
Restricted Share grants, including, without limitation, changing
or accelerating (a) the date or dates as of which such
Stock Options or Stock Appreciation Rights shall become
exercisable, (b) the date or dates as of which such
Restricted Share grants or Restricted Share Units shall become
vested, or (c) the performance period or goals in respect
of any Performance Share Units or Performance Units. Subject to
Section 16.6, no such amendment or modification shall,
however, materially adversely affect the rights of any
Participant under any such Award without the consent of such
Participant. Notwithstanding the foregoing, without the consent
of affected Participants, Awards may be amended or revised when
necessary to avoid the imposition of additional tax under
Section 409A of the Code.
12
16.
MISCELLANEOUS
.
16.1.
Tax Withholding.
The Company
shall have the right to deduct from any payment or settlement
under the Plan, including, without limitation, the exercise of
any Stock Option or Stock Appreciation Right, or the delivery,
transfer or vesting of any Common Stock or Restricted Shares,
any domestic or foreign federal, state, local or other taxes of
any kind which the Committee, in its sole discretion, deems
necessary to be withheld to comply with the Code
and/or
any
other applicable law, rule or regulation. Shares of Common Stock
may be used to satisfy any such tax withholding. Such shares of
Common Stock shall be valued based on the Fair Market Value of
such shares as of the date the tax withholding is required to be
made, such date to be determined by the Committee. In addition,
the Company shall have the right to require payment from a
Participant to cover any applicable withholding or other
employment taxes due upon any payment or settlement under the
Plan.
16.2.
No Right to Employment.
Neither
the adoption of the Plan, the granting of any Award, nor the
execution of any Award Agreement, shall confer upon any employee
of the Company or any Subsidiary any right to continued
employment with the Company or any Subsidiary, as the case may
be, nor shall it interfere in any way with the right, if any, of
the Company or any Subsidiary to terminate the employment of any
employee at any time for any reason.
16.3.
Unfunded Plan.
The Plan shall be
unfunded and the Company shall not be required to segregate any
assets in connection with any Awards under the Plan. Any
liability of the Company to any person with respect to any Award
under the Plan or any Award Agreement shall be based solely upon
the contractual obligations that may be created as a result of
the Plan or any such Award Agreement. No such obligation of the
Company shall be deemed to be secured by any pledge of,
encumbrance on, or other interest in, any property or asset of
the Company or any Subsidiary. Nothing contained in the Plan or
any Award Agreement shall be construed as creating in respect of
any Participant (or beneficiary thereof or any other person) any
equity or other interest of any kind in any assets of the
Company or any Subsidiary or creating a trust of any kind or a
fiduciary relationship of any kind between the Company, any
Subsidiary
and/or
any
such Participant, any beneficiary thereof or any other person.
16.4.
Payments to a Trust.
The
Committee is authorized to cause to be established a trust
agreement or several trust agreements or similar arrangements
from which the Committee may make payments of amounts due or to
become due to any Participants under the Plan.
16.5.
Other Company Benefit and Compensation
Programs.
Payments and other benefits received by a
Participant under an Award made pursuant to the Plan shall not
be deemed a part of a Participant’s compensation for
purposes of the determination of benefits under any other
employee welfare or benefit plans or arrangements, if any,
provided by the Company or any Subsidiary unless expressly
provided in such other plans or arrangements, or except where
the Board expressly determines in writing that inclusion of an
Award or portion of an Award should be included to accurately
reflect competitive compensation practices or to recognize that
an Award has been made in lieu of a portion of competitive
annual base salary or other cash compensation. Awards under the
Plan may be made in addition to, in combination with, or as
alternatives to, grants, awards or payments under any other
plans or arrangements of the Company or its Subsidiaries. The
existence of the Plan notwithstanding, the Company or any
Subsidiary may adopt such other compensation plans or programs
and additional compensation arrangements as it deems necessary
to attract, retain and motivate employees.
16.6.
Listing, Registration and Other Legal
Compliance.
No Awards or shares of the Common Stock
shall be required to be issued or granted under the Plan unless
legal counsel for the Company shall be satisfied that such
issuance or grant will be in compliance with all applicable
securities laws and regulations and any other applicable laws or
regulations. The Committee may require, as a condition of any
payment or share issuance, that certain agreements,
undertakings, representations, certificates,
and/or
information, as the Committee may deem necessary or advisable,
be executed or provided to the Company to assure compliance with
all such applicable laws or regulations. Certificates for shares
of the Restricted Shares
and/or
Common Stock delivered under the Plan may be subject to such
stock-transfer orders and such other restrictions as the
Committee may deem advisable under the rules, regulations, or
other requirements of the Securities and Exchange Commission,
any stock exchange upon which the Common Stock is then listed,
and any applicable laws. In addition, if, at any time specified
herein (or in any Award Agreement or otherwise) for (a) the
making of any Award, or the making of any determination,
(b) the issuance or other distribution of Restricted Shares
and/or
Common Stock, or (c) the payment of amounts to or through a
Participant with respect to any Award, any law, rule, regulation
or other requirement of any governmental authority or agency
shall require either the Company, any Subsidiary or any
Participant (or any estate, designated beneficiary or other
legal representative thereof) to take any action in connection
with any such determination, any such shares to be issued or
distributed, any such payment, or the making of any such
determination, as the case may be, shall be deferred until such
required action is taken. With respect to
13
Section 16 Officers, transactions under the Plan are
intended to comply with all applicable conditions of
Rule 16b-3
promulgated under the Exchange Act. In addition, the Company or
Committee may, at the time of grant or thereafter, impose
additional or different conditions or take other actions with
respect to Awards made to Participants in countries outside of
the United States of America, to the extent required or made
advisable by applicable laws and regulations.
16.7.
Award Agreements.
Each
Participant receiving an Award under the Plan shall enter into
an Award Agreement with the Company in a form specified by the
Committee. Each such Participant shall then agree to the
restrictions, terms and conditions of the Award set forth
therein and in the Plan. An Award Agreement may provide that,
notwithstanding any other provision in this Plan to the
contrary, if the Participant breaches provisions in the Award
Agreement during or after the Participant’s employment,
then the Participant will forfeit
and/or
repay
all Awards (whether unvested or vested) and profits realized in
connection therewith.
16.8.
Designation of Beneficiary.
Each
Participant to whom an Award has been made under the Plan may
designate a beneficiary or beneficiaries to exercise any Award
or to receive any payment which under the terms of the Plan and
the relevant Award Agreement may become exercisable or payable
on or after the Participant’s death. At any time, and from
time to time, any such designation may be changed or cancelled
by the Participant without the consent of any such beneficiary.
Any such designation, change or cancellation must be on a form
provided for that purpose by the Committee and shall not be
effective until received by the Committee. If no beneficiary has
been designated by a deceased Participant, or if the designated
beneficiaries have predeceased the Participant, the beneficiary
shall be the Participant’s estate. If the Participant
designates more than one beneficiary, any payments under the
Plan to such beneficiaries shall be made in equal shares unless
the Participant has expressly designated otherwise, in which
case the payments shall be made in the shares designated by the
Participant.
16.9.
Leaves of Absence/Transfers.
The
Committee shall have the power to promulgate rules and
regulations and to make determinations, as it deems appropriate,
under the Plan in respect of any leave of absence from the
Company or any Subsidiary granted to a Participant. Without
limiting the generality of the foregoing, the Committee may
determine whether any such leave of absence shall be treated as
if the Participant has terminated employment with the Company or
any such Subsidiary. If a Participant transfers within the
Company, or to or from any Subsidiary, such Participant shall
not be deemed to have terminated employment as a result of such
transfers.
16.10.
Governing Law.
The Plan and all
actions taken thereunder shall be governed by and construed in
accordance with the laws of the State of Delaware, without
reference to the principles of conflict of laws thereof. Any
titles and headings herein are for reference purposes only, and
shall in no way limit, define or otherwise affect the meaning,
construction or interpretation of any provisions of the Plan.
16.11.
Effective Date.
The Plan shall
be effective as of February 20, 2009 (the
“Effective Date”
) subject to approval by
the shareowners of the Company. Prior to such shareowner
approval, the Committee may grant Awards conditioned on
shareowner approval. If such shareowner approval is not obtained
at or before the first annual meeting of shareowners to occur
after the adoption of the Plan by the Board (including any
adjournments or postponements thereof), the Plan and any Awards
made thereunder shall terminate
ab initio
and be of no
further force and effect. In no event shall awards be granted
under the Plan after February 19, 2019 (or such earlier
date that the Plan may be terminated by the Board), but the term
and exercise of Awards granted theretofore may extend beyond
that date.
16.12.
Section 409A of the Code.
The Plan is intended to comply with the applicable
requirements of Section 409A of the Code and shall be
limited, construed and interpreted in accordance with such
intent. To the extent that any Award is subject to
Section 409A of the Code, it shall be paid in a manner that
will comply with Section 409A of the Code, including the
final treasury regulations or any other official guidance issued
by the Secretary of the Treasury or the Internal Revenue Service
with respect thereto. Notwithstanding anything herein to the
contrary, any provision on the Plan that is inconsistent with
Section 409A of the Code shall be deemed to be amended to
comply with Section 409A of the Code and to the extent such
provision cannot be amended to comply therewith, such provision
shall be null and void.
14
Exhibit 24.01
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENT, That I, the undersigned Director of Kellogg Company, a Delaware
corporation, hereby appoint Gary H. Pilnick, Senior Vice President, General Counsel, Corporate
Development and Secretary of Kellogg Company, as my lawful attorney-in-fact and agent, to act on my
behalf, with full power of substitution, in executing and filing:
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(a)
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009 Long-Term
Incentive Plan;
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(b)
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009
Non-Employee Director Stock Plan;
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and any exhibits, amendments and other documents related thereto, with the Securities and Exchange
Commission.
Whereupon, I grant unto said Gary H. Pilnick full power and authority to perform all necessary
and appropriate acts in connection therewith, and hereby ratify and confirm all that said
attorney-in-fact and agent, or his substitute, may lawfully do, or cause to be done, by virtue
hereof.
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/s/ James M. Jenness
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James M. Jenness
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Dated April 24, 2009
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENT, That I, the undersigned Director of Kellogg Company, a Delaware
corporation, hereby appoint Gary H. Pilnick, Senior Vice President, General Counsel, Corporate
Development and Secretary of Kellogg Company, as my lawful attorney-in-fact and agent, to act on my
behalf, with full power of substitution, in executing and filing:
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(a)
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009 Long-Term
Incentive Plan;
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(b)
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009
Non-Employee Director Stock Plan;
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and any exhibits, amendments and other documents related thereto, with the Securities and Exchange
Commission.
Whereupon, I grant unto said Gary H. Pilnick full power and authority to perform all necessary
and appropriate acts in connection therewith, and hereby ratify and confirm all that said
attorney-in-fact and agent, or his substitute, may lawfully do, or cause to be done, by virtue
hereof.
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/s/ Benjamin S. Carson Sr.,
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Benjamin S. Carson Sr.
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Dated April 24, 2009
2
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENT, That I, the undersigned Director of Kellogg Company, a Delaware
corporation, hereby appoint Gary H. Pilnick, Senior Vice President, General Counsel, Corporate
Development and Secretary of Kellogg Company, as my lawful attorney-in-fact and agent, to act on my
behalf, with full power of substitution, in executing and filing:
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(a)
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009 Long-Term
Incentive Plan;
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(b)
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009
Non-Employee Director Stock Plan;
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and any exhibits, amendments and other documents related thereto, with the Securities and Exchange
Commission.
Whereupon, I grant unto said Gary H. Pilnick full power and authority to perform all necessary
and appropriate acts in connection therewith, and hereby ratify and confirm all that said
attorney-in-fact and agent, or his substitute, may lawfully do, or cause to be done, by virtue
hereof.
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/s/ John T. Dillon
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John T. Dillon
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Dated April 24, 2009
3
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENT, That I, the undersigned Director of Kellogg Company, a Delaware
corporation, hereby appoint Gary H. Pilnick, Senior Vice President, General Counsel, Corporate
Development and Secretary of Kellogg Company, as my lawful attorney-in-fact and agent, to act on my
behalf, with full power of substitution, in executing and filing:
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(a)
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009 Long-Term
Incentive Plan;
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(b)
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009
Non-Employee Director Stock Plan;
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and any exhibits, amendments and other documents related thereto, with the Securities and Exchange
Commission.
Whereupon, I grant unto said Gary H. Pilnick full power and authority to perform all necessary
and appropriate acts in connection therewith, and hereby ratify and confirm all that said
attorney-in-fact and agent, or his substitute, may lawfully do, or cause to be done, by virtue
hereof.
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/s/ Gordon Gund
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Gordon Gund
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Dated April 24, 2009
4
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENT, That I, the undersigned Director of Kellogg Company, a Delaware
corporation, hereby appoint Gary H. Pilnick, Senior Vice President, General Counsel, Corporate
Development and Secretary of Kellogg Company, as my lawful attorney-in-fact and agent, to act on my
behalf, with full power of substitution, in executing and filing:
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(a)
|
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009 Long-Term
Incentive Plan;
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(b)
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009
Non-Employee Director Stock Plan;
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and any exhibits, amendments and other documents related thereto, with the Securities and Exchange
Commission.
Whereupon, I grant unto said Gary H. Pilnick full power and authority to perform all necessary
and appropriate acts in connection therewith, and hereby ratify and confirm all that said
attorney-in-fact and agent, or his substitute, may lawfully do, or cause to be done, by virtue
hereof.
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/s/ Dorothy A. Johnson
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Dorothy A. Johnson
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Dated April 24, 2009
5
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENT, That I, the undersigned Director of Kellogg Company, a Delaware
corporation, hereby appoint Gary H. Pilnick, Senior Vice President, General Counsel, Corporate
Development and Secretary of Kellogg Company, as my lawful attorney-in-fact and agent, to act on my
behalf, with full power of substitution, in executing and filing:
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(a)
|
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009 Long-Term
Incentive Plan;
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(b)
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009
Non-Employee Director Stock Plan;
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and any exhibits, amendments and other documents related thereto, with the Securities and Exchange
Commission.
Whereupon, I grant unto said Gary H. Pilnick full power and authority to perform all necessary
and appropriate acts in connection therewith, and hereby ratify and confirm all that said
attorney-in-fact and agent, or his substitute, may lawfully do, or cause to be done, by virtue
hereof.
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/s/ Donald R. Knauss
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Donald R. Knauss
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Dated April 24, 2009
6
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENT, That I, the undersigned Director of Kellogg Company, a Delaware
corporation, hereby appoint Gary H. Pilnick, Senior Vice President, General Counsel, Corporate
Development and Secretary of Kellogg Company, as my lawful attorney-in-fact and agent, to act on my
behalf, with full power of substitution, in executing and filing:
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(a)
|
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009 Long-Term
Incentive Plan;
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(b)
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009
Non-Employee Director Stock Plan;
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and any exhibits, amendments and other documents related thereto, with the Securities and Exchange
Commission.
Whereupon, I grant unto said Gary H. Pilnick full power and authority to perform all necessary
and appropriate acts in connection therewith, and hereby ratify and confirm all that said
attorney-in-fact and agent, or his substitute, may lawfully do, or cause to be done, by virtue
hereof.
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/s/ Ann McLaughlin Korologos
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Ann McLaughlin Korologos
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Dated April 24, 2009
7
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENT, That I, the undersigned Director of Kellogg Company, a Delaware
corporation, hereby appoint Gary H. Pilnick, Senior Vice President, General Counsel, Corporate
Development and Secretary of Kellogg Company, as my lawful attorney-in-fact and agent, to act on my
behalf, with full power of substitution, in executing and filing:
|
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(a)
|
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009 Long-Term
Incentive Plan;
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(b)
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009
Non-Employee Director Stock Plan;
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and any exhibits, amendments and other documents related thereto, with the Securities and Exchange
Commission.
Whereupon, I grant unto said Gary H. Pilnick full power and authority to perform all necessary
and appropriate acts in connection therewith, and hereby ratify and confirm all that said
attorney-in-fact and agent, or his substitute, may lawfully do, or cause to be done, by virtue
hereof.
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/s/ Rogelio M. Rebolledo
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Rogelio M. Rebolledo
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Dated April 24, 2009
8
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENT, That I, the undersigned Director of Kellogg Company, a Delaware
corporation, hereby appoint Gary H. Pilnick, Senior Vice President, General Counsel, Corporate
Development and Secretary of Kellogg Company, as my lawful attorney-in-fact and agent, to act on my
behalf, with full power of substitution, in executing and filing:
|
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(a)
|
|
the Registration Statement on Form S-8 relating to the Kellogg Company 2009 Long-Term
Incentive Plan;
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|
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(b)
|
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the Registration Statement on Form S-8 relating to the Kellogg Company 2009
Non-Employee Director Stock Plan;
|
and any exhibits, amendments and other documents related thereto, with the Securities and Exchange
Commission.
Whereupon, I grant unto said Gary H. Pilnick full power and authority to perform all necessary
and appropriate acts in connection therewith, and hereby ratify and confirm all that said
attorney-in-fact and agent, or his substitute, may lawfully do, or cause to be done, by virtue
hereof.
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/s/ Sterling K. Speirn
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Sterling K. Speirn
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Dated April 24, 2009
9
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENT, That I, the undersigned Director of Kellogg Company, a Delaware
corporation, hereby appoint Gary H. Pilnick, Senior Vice President, General Counsel, Corporate
Development and Secretary of Kellogg Company, as my lawful attorney-in-fact and agent, to act on my
behalf, with full power of substitution, in executing and filing:
|
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(a)
|
|
the Registration Statement on Form S-8 relating to the Kellogg Company 2009 Long-Term
Incentive Plan;
|
|
|
|
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(b)
|
|
the Registration Statement on Form S-8 relating to the Kellogg Company 2009
Non-Employee Director Stock Plan;
|
and any exhibits, amendments and other documents related thereto, with the Securities and Exchange
Commission.
Whereupon, I grant unto said Gary H. Pilnick full power and authority to perform all necessary
and appropriate acts in connection therewith, and hereby ratify and confirm all that said
attorney-in-fact and agent, or his substitute, may lawfully do, or cause to be done, by virtue
hereof.
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/s/ Robert A. Steele
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Robert A. Steele
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Dated April 24, 2009
10
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENT, That I, the undersigned Director of Kellogg Company, a Delaware
corporation, hereby appoint Gary H. Pilnick, Senior Vice President, General Counsel, Corporate
Development and Secretary of Kellogg Company, as my lawful attorney-in-fact and agent, to act on my
behalf, with full power of substitution, in executing and filing:
|
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(a)
|
|
the Registration Statement on Form S-8 relating to the Kellogg Company 2009 Long-Term
Incentive Plan;
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|
|
|
|
(b)
|
|
the Registration Statement on Form S-8 relating to the Kellogg Company 2009
Non-Employee Director Stock Plan;
|
and any exhibits, amendments and other documents related thereto, with the Securities and Exchange
Commission.
Whereupon, I grant unto said Gary H. Pilnick full power and authority to perform all necessary
and appropriate acts in connection therewith, and hereby ratify and confirm all that said
attorney-in-fact and agent, or his substitute, may lawfully do, or cause to be done, by virtue
hereof.
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/s/ John L. Zabriskie
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John L. Zabriskie
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Dated April 24, 2009
11
