HEI Exhibit 10.1
HAWAIIAN ELECTRIC INDUSTRIES,
INC.
STOCK APPRECIATION RIGHT
AGREEMENT
WITH DIVIDEND
EQUIVALENTS
THIS AGREEMENT, dated effective as
of «Date» , is made by and between Hawaiian
Electric Industries, Inc., a Hawaii corporation hereinafter
referred to as the “Company,” and
«Name» , an employee of the Company or of a
Subsidiary of the Company, hereinafter referred to as the
“Employee.”
WHEREAS, the Company has heretofore
adopted the 1987 Stock Option and Incentive Plan of Hawaiian
Electric Industries, Inc. (as amended and restated effective April
20, 2004) (hereinafter referred to as the
“Plan”);
WHEREAS, the Compensation Committee
of the Company’s Board of Directors (hereinafter referred to
as the “Committee”), appointed to administer the Plan,
has determined that it would be to the advantage and best interest
of the Company and its shareholders to grant to the Employee a
stock appreciation right pursuant to the Plan as an inducement to
the Employee to remain in the service of the Company or its
Subsidiary and as a long-term incentive for sustained high levels
of performance for the Company and its Subsidiaries; and
WHEREAS, the Committee has
instructed the Company to issue said stock appreciation right, as
authorized under the Plan, pursuant to the terms and conditions set
forth herein;
NOW, THEREFORE, in consideration of
the mutual covenants herein contained and other good and valuable
consideration, the receipt of which is hereby acknowledged, the
parties hereto do hereby agree as follows:
ARTICLE I
DEFINITIONS
Whenever the following terms are
used in this Agreement they shall have the meanings specified below
unless the context clearly indicates to the contrary.
Section 1.1
- Average Fair Market
Value
“Average Fair Market
Value” means, as of any determination date, the average of
the daily high and low sales prices of the Common Stock on the New
York Stock Exchange as quoted in the Composite Transactions
published in the Western Edition of The Wall Street Journal for all
trading days during the calendar month preceding the determination
date. If the Common Stock is not admitted to trade on the New York
Stock Exchange, the Average Fair Market Value shall be determined
by the Committee in such other reasonable manner as the Committee
shall decide.
Section 1.2
- Board of
Directors
“Board of Directors”
means the Board of Directors of the Company.
Section 1.3
- Cause
“Cause” means, with
respect to the discharge by the Company or a Subsidiary of the
Employee, (i) refusal to perform duties assigned in accordance with
the Employee’s employment agreement with the Company or the
Subsidiary, if any, or assigned by any officer of the Company or
the Subsidiary, or overt and willful disobedience of orders or
directives issued to the Employee by the Company or the Subsidiary,
and within the scope of the Employee’s duties to the Company
or the Subsidiary; (ii) commission of illegal acts in connection
with the performance of duties on behalf of the Company or the
Subsidiary; or (iii) material violation of the policies and
procedures of the Company or the Subsidiary.
Section 1.4
– Change in
Control
“Change in Control”
means a “change in control of the Company” within the
meaning of Section 9.1(d) of the Plan, except that clauses (iii)
and (iv) thereof shall be deemed to read as follows,
respectively:
(iii) there is consummated a merger
or consolidation of the Company or any subsidiary of the Company
with any other company, other than (A) a merger or consolidation
that results in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities
of the surviving entity), in combination with the ownership of any
trustee or other fiduciary holding securities under an employee
benefit plan of the Company or any of its affiliates, at least 75%
of the combined voting power of the voting securities of the
Company or such surviving entity outstanding immediately after such
merger or consolidation, or (B) a merger
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or consolidation effected to
implement a recapitalization of the Company (or similar
transaction) in which no Person acquires more than 50% of the
combined voting power of the Company’s then outstanding
securities, or
(iv) the shareholders of the Company
approve a plan of complete liquidation of the Company or there is
consummated a sale or disposition of all or substantially all of
the Company’s assets.
Section 1.5
- Code
“Code” means the
Internal Revenue Code of 1986, as amended.
Section 1.6
- Committee
“Committee” means the
Compensation Committee of the Board of Directors. The Committee
will consist of two or more persons who are “disinterested
persons” within the meaning of Rule 16b-3 promulgated under
Section 16 of the Securities Exchange Act of 1934, as amended, and
“outside directors” within the meaning of Section
162(m) of the Code.
Section 1.7
- Common Stock
“Common Stock” means the
Common Stock of the Company.
Section 1.8
- Fair Market
Value
“Fair Market Value”
means, as of any determination date, the average of the daily high
and low sales prices of the Common Stock on the composite tape for
stocks listed on the New York Stock Exchange as quoted in the New
York Stock Exchange Composite Transactions published in the Western
Edition of The Wall Street Journal on the date as of which
Fair Market Value is to be determined, or if there is no trading of
Common Stock on such date, the average of the daily high and low
sales prices of the Common Stock as quoted in such Composite
Transactions on the next preceding date on which there was trading
in such shares, or if the Common Stock is not admitted to trade on
the New York Stock Exchange, the Fair Market Value shall be
determined by the Committee in such other reasonable manner as the
Committee shall decide.
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Section 1.9
- Plan
“Plan” means the
Company’s 1987 Stock Option and Incentive Plan, as amended
and restated effective January 21, 2003, and as may be further
amended from time to time.
Section 1.10
– SAR
“SAR” means the stock
appreciation right granted under this Agreement.
Section 1.11
- Subsidiary
“Subsidiary” means any
corporation (other than the Company) in an unbroken chain of
corporations beginning with the Company if, at the time of the
granting of the SAR, each of the corporations other than the last
corporation in the unbroken chain owns stock possessing 50 percent
or more of the total combined voting power of all classes of stock
in one of the other corporations in such chain.
Section 1.12
- Termination of
Employment
“Termination of
Employment” means the time when the employee-employer
relationship between the Employee and the Company or a Subsidiary
is terminated for any reason, including but not limited to a
termination by resignation, discharge, death or retirement, but
excluding any termination where there is a simultaneous
reemployment by the Company or a Subsidiary. The Committee, in its
sole discretion, shall determine the effect of all other matters
and questions relating to Termination of Employment, including but
not limited to the question of whether a Termination of Employment
resulted from a discharge for Cause, and all questions of whether
particular leaves of absence constitute Terminations of
Employment.
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ARTICLE II
GRANT OF SAR
Section 2.1
- Grant of SAR
In consideration of the
Employee’s continued service to the Company or its
Subsidiaries and for other good and valuable consideration, on the
date hereof the Company grants to the Employee an SAR covering any
part or all of an aggregate of «Shares» shares of
its Common Stock, subject to the vesting provisions and upon the
terms and conditions set forth in this Agreement.
Section 2.2
– Grant
Price
The grant price of the shares of
Common Stock covered by the SAR shall be $26.18 per share,
which represents the Average Fair Market Value as of the date of
grant of the SAR.
Section 2.3
- Consideration to the
Company
In consideration of the granting of
the SAR by the Company the Employee agrees to render faithful and
efficient services to the Company or a Subsidiary, with such duties
and responsibilities as the Company shall from time to time
prescribe, from the date the SAR is granted to the date of
Termination of Employment. Nothing in this Agreement or in the Plan
shall confer upon the Employee any right to continue in the employ
of the Company or any Subsidiary or shall interfere with or
restrict in any way the rights of the Company and its Subsidiaries,
which are hereby expressly reserved, to discharge the Employee at
any time for any reason whatsoever, with or without
Cause.
Section 2.4
- Adjustments to the
SAR
The number of shares, grant price
and other terms and conditions of the SAR are subject to adjustment
by the Committee in accordance with the applicable adjustment
provisions of the Plan, as in existence on the date of this
Agreement. Any such adjustment by the Committee shall be final and
binding upon the Employee, the Company, and all other interested
persons.
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ARTICLE III
PERIOD OF
EXERCISABILITY
Section 3.1
- Commencement of
Exercisability
(a) The SAR shall vest and become
exercisable on the fourth anniversary of the date the SAR was
granted.
(b) No portion of the SAR which is
unexercisable under the terms of this Agreement at Termination of
Employment shall thereafter become exercisable, unless the
Committee, in its sole discretion, elects to accelerate the vesting
of all or any portion of the unvested shares on the date of
termination.
Section 3.2
- Expiration of
SAR
The SAR shall expire and may not be
exercised to any extent by anyone after the first to occur of the
following events:
(a) The expiration of 10 years from
the date the SAR was granted; or
(b) The Employee’s Termination
of Employment for Cause; or
(c) The expiration of one year from
the date of the Employee’s Termination of Employment for any
reason other than retirement, death, disability, or
Cause;
(d) The expiration of three years
from the date of the Employee’s Termination of Employment as
a result of the Employee’s retirement, death or
disability.
Section 3.3
- Acceleration of
Exercisability
(a) If the Employee’s
Termination of Employment occurs as a result of r
