PERFORMANCE SHARE AWARD AGREEMENT UNDER THE EXPRESS SCRIPTS, INC.
Exhibit
10.2
UNDER
THE
EXPRESS
SCRIPTS, INC.
2000
LONG-TERM INCENTIVE PLAN
THIS AWARD AGREEMENT is made
and entered into _______________ (the "Date of Grant"), by and between Express
Scripts, Inc. (the "Company"), and ______________
("Employee").
BACKGROUND
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A.
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The
Board of Directors of the Company (the "Board of Directors") has adopted,
and the Company's shareholders have approved, the Express Scripts, Inc.
2000 Long-Term Incentive Plan (the "Plan"), pursuant to which performance
share incentive awards may be granted to employees of the Company and its
subsidiaries and certain other
individuals.
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B.
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The
Board of Directors intends to amend the Plan, subject to approval of the
shareholders of the Company, to revise the performance measures
thereunder.
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C.
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The
Company desires to grant to Employee a performance share award under the
terms of the Plan.
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D. Pursuant
to the Plan, the Company and Employee agree as follows:
AGREEMENT
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1.
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Grant
of Award. Pursuant to
action of the Committee (as defined herein) which was taken on the Date of
Grant, the Company grants to Employee _______ performance
shares ("Performance Shares"), subject to the terms, conditions, and
adjustments set forth in this Award Agreement and Exhibit A
hereto. The Performance Shares granted under this Section 1 are
referred to in this Award Agreement as the "Target
Grant."
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2.
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Award
Subject to Plan. This award
is granted under, and is expressly subject to, the terms and provisions of
the Plan, as amended from time to time, which terms are incorporated
herein by reference, and this Award Agreement. The Committee
described in Section 3 of the Plan (the "Committee") has been appointed by
the Board of Directors, and designated by it, as the Committee to make
awards.
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3.
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Performance
Period. The performance period for this award shall be
as set forth on Exhibit A hereto (the "Performance
Period").
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4.
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Payment. Subject to
early termination of this Award Agreement pursuant to Section 6 below,
following the end of the Performance Period and during the calendar year
in which such Performance Period ends, the Company will deliver to
Employee one share of the Company's Stock for each then-outstanding
Performance Share under this Award Agreement; except that, fractional
Shares shall be rounded down to the nearest whole Share and that a portion
of the payment shall be withheld to satisfy the payment of taxes required
by law or to take such other action as may be necessary in the opinion of
the Company to satisfy all obligations for withholding of such taxes as
provided in Section 7.
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5.
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Performance
Criteria and Adjustments. The Target
Grant shall be adjusted pursuant to the Company’s performance against
certain criteria (the “Performance Criteria”) as further set out on
Exhibit A hereto.
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6.
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Termination
of Award.
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a.
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Except
as otherwise specifically set forth in this Section 6, this Award
Agreement will terminate and be of no further force or effect on the date
that Employee is no longer actively employed by the Company or any of its
Affiliates prior to the date on which the Performance Period
ends. Employee will, however, be entitled to receive any Stock
payable under Section 4 of this Award Agreement if Employee's employment
terminates after the Performance Period but before Employee's receipt of
such Stock.
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b.
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If
Employee’s employment terminates before the end of the Performance Period
on account of death, Disability or Retirement, any portion of this award
which has not yet vested shall vest at such time, but only to the extent
the Performance Criteria are ultimately achieved and any payment under
Section 4 hereof shall be prorated for the portion of the Performance
Period during which Employee was employed by the Company or any
Affiliate.
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c.
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If
Employee’s employment is terminated by the Company without Cause before
the end of the Performance Period, a portion of this award which has not
yet vested shall vest at such time, which portion shall be equal to the
lesser of:
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(i)
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the
portion of the award which would have vested and been paid had the
Employee’s employment been terminated due to death, Disability or
Retirement, as determined under Section 6(b) above (after taking into
account the pro-ration for the portion of the Performance Period during
which Employee was employed by the Company or any Affiliate);
or
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(ii)
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the
portion of the award which would have vested and been paid, based on the
extent the Performance Criteria had been achieved, if the Performance
Period had ended as of the date on which the Employee’s employment is
terminated, which amount shall also be prorated for the portion of the
actual Performance Period during which Employee was employed by the
Company or any Affiliate.
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d.
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Without
limiting the foregoing, in the event Employee’s employment terminates
before the end of the Performance Period on account of death, Disability,
Retirement or termination by the Company without Cause, any portion of the
award which vests in accordance with either Section 6(b) or 6(c) above
shall be payable at the time and in the manner set forth in Section 4
after the end of the Performance
Period.
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e.
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Notwithstanding
the foregoing or any provision of the Plan to the contrary, upon a Change
in Control prior to the date on which the Performance Period ends, the
following shall occur:
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(i)
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if
Employee continues to be actively employed by the Company or any Affiliate
on the date of such Change in Control, Employee shall receive in cash the
value of one share of Company Stock on the last trading day before the
Change in Control Date multiplied by the greater of the following: (A) the
total number of Performance Shares awarded pursuant to this Agreement
(without pro-ration), or (B) the portion of the award which would have
vested and been paid, based on the extent the Performance Criteria had
been achieved, if the Performance Period had ended as of the day
immediately preceding the Change in Control Date (without
pro-ration).
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(ii)
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if
Employee’s employment was terminated on account of death, Disability or
Retirement prior to such Change in Control, Employee shall receive in cash
the value of one share of Company Stock on the last trading day before the
Change in Control multiplied by the number of Performance Shares awarded
pursuant to this Agreement (without
pro-ration),
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(iii)
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if
the Employee’s employment was terminated by the Company without Cause
prior to such Change in Control, Employee shall receive in cash the value
of one share of Company Stock on the last trading day before the Change in
Control multiplied by the lesser of (A) the total number of Performance
Shares awarded pursuant to this Agreement, prorated for the portion of the
Performance Period during which Employee was employed by the Company or
any Affiliate, or (B) the number of Performance Shares which would have
been paid under Section 6(c)(ii)
above.
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The
amount payable under this Section 6(e) shall be subject to applicable
withholding taxes. This Award shall terminate immediately
following payment upon a Change in Control, and no further payment shall
be made hereunder.
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f.
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With
respect to any provisions of this Agreement which require the calculation
of the portion of the award which would have vested and been paid based on
the extent the Performance Criteria had been achieved as of a date other
than the original ending date for the Performance Period (e.g. Sections
6(c)(ii), 6(e)(i) and 6(e)(iii)), to the extent applicable to the selected
Performance Criteria, such calculations shall be made as
follows:
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(i) Performance
Criteria based on factors which are readily measurable as of the calculation
date or the preceding business day (e.g. those based on publicly-reported
trading price) shall be determined (for both the Company and any peer companies)
as if the Performance Period ended on such calculation date;
(ii) Performance
Criteria which are not readily measurable as of the calculation date or the
preceding business day, but which may be measured based on regularly-reported
quarterly financial statements, shall be measured for both the Company and any
peer companies based on each such company’s most recently reported quarterly (or
year-end) financial results; and
(iii) for
any Performance Criteria which may not be measured pursuant to preceding
paragraphs (i) and (ii), the Company shall retain an independent consultant to
determine the extent to which such Performance Criteria have been achieved as of
the calculation date.
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7.
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Tax
Withholding.
Employee must pay, or make arrangements acceptable to the Company
for the payment of, any and all federal, state, and local income and
payroll tax withholding that in the opinion of the Company is required by
law. Unless Employee satisfies any such tax withholding
obligation by paying the amount in cash or by check, the Company will
withhold cash and/or shares of Stock having a Fair Market Value on the
date of withholding sufficient to cover the withholding
obligation.
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8.
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Non-Transferability. Neither
this award nor any rights under this Award Agreement may be assigned,
transferred, or in any manner encumbered except by will or the laws of
descent and distribution, and any attempted assignment, transfer,
mortgage, pledge or encumbrance except as herein authorized, will be void
and of no effect.
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9.
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Definitions:
Copy of Plan and Plan Prospectus. To the
extent not specifically defined in this Award Agreement, all capitalized
terms used in this Award Agreement will have the same meanings ascribed to
them in the Plan. By signing this Award Agreement, Employee
acknowledges receipt of a copy of the Plan and the related Plan
Prospectus.
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10.
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Choice
of Law. To the
extent that federal laws do not otherwise control, this Award Agreement
and all determinations made and actions taken hereunder shall be governed
by the laws of the State of Delaware, without giving effect to principles
of conflicts of laws, and construed
accordingly.
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An
authorized representative of the Company has signed this Award Agreement, and
Employee has signed this Award Agreement to evidence Employee's acceptance of
the award on the terms specified in this Award Agreement, all as of the Date of
Grant.
| EXPRESS SCRIPTS, INC. | |||
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Date
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By:
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| Name | |||
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| Employee | |||