Exhibit (10)(q)
POTLATCH
CORPORATION
PERFORMANCE SHARE
AGREEMENT
2000 STOCK INCENTIVE
PLAN
THIS PERFORMANCE
SHARE AGREEMENT made and entered into the Grant Date specified in
the attached addendum to this Agreement by and between POTLATCH
CORPORATION , a Delaware corporation (the
“Corporation”), and the employee of the Corporation
named in the attached addendum (“Employee”),
W I T N E S S E T
H:
WHEREAS, the
Corporation maintains the the 2000 Stock Incenitve Plans (the
“Plan”), which are incorporated into and form a part of
this Agreement, and the Employee has been selected to receive a
contingent grant of performance shares under Section 9 of the Plan
( Other Share Based Awards),
NOW, THEREFORE,
for valuable consideration, the parties agree as
follows:
1. Definitions . The
following terms used in this Agreement shall have the meanings set
forth in this Paragraph.
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(a)
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“ Agreement
” means this Performance Share Agreement.
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(b)
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“ Board ”
means the Board of Directors of the Corporation.
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(c)
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“ Change in
Control ” means an event or transaction described under
Paragraph 12 “Change of Control”, subparagraphs (a),
(b) and (c) of this Agreement .
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(d)
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“ Code ”
means the Internal Revenue Code of 1986, as amended.
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(e)
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“ Common Stock
” means the $1 par value Common Stock of the
Corporation.
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(f)
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“ Committee
” means the committee appointed by the Board to administer
the Plan.
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(g)
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“ Corporation
” means Potlatch Corporation, a Delaware
corporation.
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(h)
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“ Date of Grant
” means the date on which the Committee determined to award
this target congingent grant of performance share as specified in
the addendum to this Agreement
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(i)
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“ Disability
” means the Employee qualifies for continuing benefits under
the Corporation’s Disability Income Plan after the first full
24 consecutive months of disability.
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(j)
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“ Other Share-based
Award ” means an Award granted pursuant to Section 9 of
the Plans.
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(k)
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“ Plan ”
means the Potlatch Corporation 2000 Stock Incentive Plan, pursuant
to which the parties have entered into this Agreement.
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(l)
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“ Securities Act
” means the Securities Act of 1933, as amended.
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(m)
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“ Share ”
means one share of Common Stock, adjusted in accordance with
Section 13 of the Plans.
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(n)
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“ Subsidiary
” means any corporation in an unbroken chain of corporations
beginning with the Corporation if each of the corporations other
than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all
classes of stock in one of the other corporations in such
chain.
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2. Award . Subject to
the terms of this Agreement and the addendum attached to this
Agreement, the Employee is hereby awarded a target contingent grant
of performance shares in the number set forth in the attached
addendum to this Agreement. The number of Shares actually payable
to the Employee is contingent on the performance achieved as
specified in the addendum to this Agreement. This award has been
granted pursuant to the Plan, a copy of which the Employee may
obtain upon request to the Corporation.
3. Performance Measure
. The performance measure is a comparison of the percentile ranking
of the Corporation’s total shareholder return (stock price
appreciation plus dividends as calculated pursuant to Paragraph 5
below) as compared to the total shareholder return performance of a
selected peer group of forest products industry companies as
specified in the Performance Schedule contained in the addendum to
this Agreement.
4. Performance Period
. The performance period is the period specified in the addendum to
this Agreement and represents the period during which the total
shareholder return for Potlatch Corporation and the selected peer
group of forest products industry companies is measured.
5. Calculation Of Total
Shareholder Return . Total shareholder return for any given
common stock shall be expressed as a percentage and calculated
by:
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(i)
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subtracting (a)
the beginning average stock price for one share of stock
(determined by calculating the average closing stock price
during
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2
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the two
calendar months preceding the beginning of the performance period)
from (b) the ending average stock price for such share of stock
(determined by calculating the average closing stock price during
the final two calendar months of the performance period, after
taking into account the affect of any stock dividends, stock
splits, consolidations, recapitalizations, reorganizations or like
events with respect to such share); and
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(ii)
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adding to the difference
determined under subparagraph (i) above, all cash dividends
actually paid on such share of stock during the performance period;
and
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(iii)
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dividing the sum determined by
subparagraphs (i) and (ii) above by the beginning average stock
price determined pursuant to subparagraph (i)(a) above.
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6. Dividend
Equivalents . During the performance period dividend
equivalents shall be accrued and paid out as additional Shares in
relation to the calculated number of performance shares earned at
the end of the performance period. For the purpose of converting
dividend equivalents into Shares, the ending average stock price
for Potlatch Shares (as determined pursuant to Paragraph 5(i)(b)
above) shall be used.
7. Settlement of
Awards . The Corporation shall deliver to the Employee one
Share for each performance share (and dividend equivalents) earned
as determined in accordance with the provisions set forth in the
addendum to this Agreement. The earned performance shares payable
to the Employee (including Shares payable pursuant to Paragraph 6
above) shall be paid solely in Shares. Any fractional share will be
rounded to the closest whole share.
8. Time of Payment .
Except as otherwise provided in this Agreement, the performance
shares earned as specified in the addendum to this Agreement will
be delivered to the Employee (or, in the case of the
Employee’s death before delivery, to the Employee’s
beneficiary) as soon as practicable after the end of the
performance period as set forth in the addendum to this
Agreement.
9. Committee Discretion to
Reduce Award . Notwithstanding any provision in this Agreement
to the contrary, the Committee retains the right, at its sole and
absolute discretion, to reduce or eliminate any award that may
become payable hereunder if the Committee determines that any one
or more of the following conditions have occurred:
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(a)
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The stockholder return to the
Corporation’s stockholders has been insufficient;
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(b)
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The stockholder return to the
Corporation’s stockholders has been negative;
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(c)
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The financial performance of
the Corporation has been inadequate; or
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(d)
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The operational performance of
the Corporation has been inadequate
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In addition, the Committee
may reduce or eliminate the award granted hereby based on the
Employee’s individual performance.
10. Retirement,
Disability, or Death During Performance Period . If the
Employee’s employment with the Corporation terminates during
the performance period because of
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the Employee’s
retirement under the Salaried Employees’ Retirement Plan,
Disability, or death, the Employee (or, in the case of the
Employee’s death, the Employee’s beneficiary) shall be
entitled to a prorated number of the performance shares earned as
specified in the addendum to this Agreement. The prorated number of
performance shares earned is determined at the end of the
performance period based on the ratio of the number of completed
calendar months the Employee is employed during the performance
period to the total number of months in the performance
period.
11. Termination of
Employment During the Performance Period . If the
Employee’s employment with the Corporation terminates during
the performance period for any reason other than retirement under
the Salaried Employees’ Retirement Plan, Disability, or
death, the entire target contingent grant of performance shares
granted under this Agreement shall be automatically terminated as
of the date of such termination of employment.
12. Change of Control
. Upon a Change of Control, the Employee will earn a prorated
number of performance shares based on the ratio of the number of
completed calendar months from the beginning of the performance
period to the end of the calendar month in which the Change of
Control occurs compared to the total number of months in the
performance period specified in the addendum to this Agreement. For
the purpose of determining the number of Shares to be awarded, this
ratio shall be applied to the number of Shares specified in the
Target Grant of Performance Shares set forth in the addendum to
this Agreement and no performance measure shall be considered. The
prorated performance shares to be awarded (including Shares payable
pursuant to Paragraph 6 above) will be delivered to the Employee as
soon as practicable following the date of the Change of
Control.
The term Change of
Control means:
(a) The
consummation of a reorganization, merger or consolidation involving
the Corporation (a “Business Combination”), in each
case, unless, following such Business Combination, (A) all or
substantially all of the individuals and entities who were the
beneficial owners, resp
