Chevron Corporation Long-Term Incentive Plan Award Non-Qualified Stock Options Terms and Conditions

EX-10.8 4 cvx12312014ex108ltipnqso.htm EXHIBIT 10.8 CVX 12.31.2014 EX 10.8 LTIP NQSO

Exhibit 10.8

Chevron Corporation

Long-Term Incentive Plan Award

Non-Qualified Stock Options

Terms and Conditions

STOCK OPTION AWARD. Your Stock Option Award is for non-qualified stock options to purchase shares of Chevron Corporation common stock. These stock options are granted to you under the Long-Term Incentive Plan (“Plan”). The Plan’s terms and the terms of the Rules adopted pursuant to the Plan are incorporated herein. For a copy of the plan documents, go to http://hr.chevron.com/northamerica/us/payprograms/executiveplans/ltip.asp or the Global Executive Plans Web site at http://hr.chevron.com/globalprograms/execplans/ltip.aspx, or contact the Executive Compensation Group at ***@*** or ###-###-####. By accepting this Stock Option Award, you agree to all terms and conditions of the Plan, its Rules, and any provisions herein that may be in addition thereto. In the event of any conflict between the provisions of this agreement and the terms of the Plan or Rules, the terms of the Plan and/or Rules shall govern. The aforesaid documents and the number of options granted as reflected in your Morgan Stanley account collectively constitute the Award.


A.	GRANT DATE. The Grant Date of your Stock Option Award is [insert date].


B.	NUMBER OF OPTIONS GRANTED. The number of stock options granted is reflected on the [insert date] grant detail screen in the ”Stock Option/SAR” section of your Morgan Stanley account at www.benefitaccess.com.


C.	EXERCISE PRICE. The exercise price is the Chevron common stock closing price (U.S.$[insert price]) on the Grant Date, as listed on the New York Stock Exchange (“NYSE”). You can find the exercise price from the Chevron Historical Price Lookup page at http://investor.chevron.com/phoenix.zhtml?c=130102&p=irol-stockLookup


D.	VESTING SCHEDULE. Subject to Subsection F., 33 1/3% of the Stock Option Award shall vest on the first anniversary of the Grant Date, 66 2/3% shall vest on the second anniversary of the Grant Date and 100% shall vest on the third anniversary of the Grant Date. The Stock Option Award cannot be exercised to the extent it is not vested.

EXERCISE PERIOD. Subject to Subsection F., your vested stock options may be exercised up until the tenth anniversary of the Grant Date, provided you remain employed by Chevron and the NYSE is open on such date. Should this tenth anniversary date fall on a day that the NYSE is not open, stock options may be exercised only up until the last day that the NYSE is open immediately prior to that tenth anniversary.


F.	EFFECT OF TERMINATION ON VESTING AND EXERCISE PERIOD. Termination of employment impacts your Stock Option Award’s Vesting Schedule and Exercise Period.

Termination for Non-European Union Payroll Countries

If you are on a non-European Union country’s payroll at termination of employment, your Stock Option Award is affected as follows.

One hundred percent (100%) of the Stock Option Award will vest if your employment terminates on or after [insert date] and if, upon termination of employment, you are at least age 65, have at least 90 points (sum of age and service at termination of employment), or submit documentation substantiating required retirement due to the attainment of the normal statutory or mandatory retirement age, based on the applicable jurisdiction for your employing company at the time of termination. Your vested Stock Option Award is exercisable until the tenth anniversary of the Grant Date as described in Subsection E.

ii.

A portion of the Stock Option Award will vest if your employment terminates on or after [insert date] and if, upon termination of employment, you are at least age 60 or have at least 75 points (sum of age and service at termination of employment). The number of vested stock options is determined by multiplying the number of stock options granted by the number of whole months from the Grant Date to your termination date, up to a maximum of 36 months, divided by 36 months. The portion not vested is forfeited. The vested

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portion of your Stock Option Award is exercisable until the last day that the NYSE is open that is no more than five years after your termination date or, if earlier, the date it would last be exercisable under Subsection E. in the absence of your termination.


iii.	One hundred percent (100%) of the Stock Option Award will vest if you terminate employment after a Change in Control and qualify for a Change in Control severance pay program maintained by the Corporation. Your vested Stock Option Award is exercisable until the tenth anniversary of the Grant Date as described in Subsection E.

iv.

If at termination of employment, none of the above Subsections F.i., F.ii., and F.iii. is satisfied, the portion of your Stock Option Award that is not vested at termination is forfeited. The portion of your Stock Option Award that is already vested is exercisable until the last day that the NYSE is open that is no more than 180 days after your termination date or, if earlier, the date it would last be exercisable under Subsection E. in the absence of your termination.

Termination for European Union Payroll Countries

If you are on an European Union country’s payroll at termination of employment, your Stock Option Award is affected as follows.


v.	If your employment terminates on or after [insert date] and if, upon termination of employment, you have at least 30 years of service, your Stock Option Award will continue to vest according to the Vesting Schedule under Subsection D. Your vested Stock Option Award is exercisable until the tenth anniversary of the Grant Date as described in Subsection E.

vi.

If your employment terminates on or after [insert date] and if, upon termination of employment, you have at least 25 years of service but less than 30 years of service, the portion of your Stock Option Award that is not vested at termination is forfeited. The portion of your Stock Option Award that is already vested is exercisable until the last day that the NYSE is open that is no more than five years after your termination date or, if earlier, the date it would last be exercisable under Subsection E. in the absence of your termination.

vii.

If your employment terminates on or after [insert date] and if, upon termination of employment, you have at least one year of service but less than 25 years of service, the portion of your Stock Option Award that is not vested at termination is forfeited. The portion of your Stock Option Award that is already vested is exercisable until the last day that the NYSE is open that is no more than 180 days after your termination date or, if earlier, the date it would last be exercisable under Subsection E. in the absence of your termination.


viii.	One hundred percent (100%) of the Stock Option Award will vest if you terminate employment after a Change in Control and qualify for a Change in Control severance pay program maintained by the Corporation. Your vested Stock Option Award is exercisable until the tenth anniversary of the Grant Date as described in Subsection E.


ix.	If at termination of employment, none of the above Subsections F.v., F.vi., F.vii., and F.viii. is satisfied, 100 percent of your Stock Option Award is forfeited.

DISABILITY. For purposes of the Vesting Schedule and the Exercise Period of your Stock Option Award, you are deemed to have terminated upon the earlier of twenty-nine (29) months after the commencement of long-term disability benefits under a plan or program sponsored by the Corporation, or the date you fail to qualify or no longer qualify for such long-term disability benefits, provided that you do not return to active employment with the Corporation at that time.


H.	FAILURE TO EXERCISE. Unexercised Stock Option Awards are forfeited at the end of the applicable Exercise Period.

EXERCISE CHOICES. You may exercise your vested Stock Option Award under the following four exercise choices: (i) same day sale; (ii) sell-to-cover; (iii) cash exercise; or (iv) stock swap. For more information, please refer to “Exercise Choices and Examples” at http://hr.chevron.com/northamerica/us/payprograms/executiveplans/exercisechoices.asp, or, if you are not subject to U.S. taxation, http://hr.chevron.com/globalprograms/execplans/exercisechoices.aspx.


J.	NO DEFERRAL. You may not defer payment of proceeds as a result of the exercise of your Stock Option Award.

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K.	MISCONDUCT. Stock Option Awards may be forfeited for Misconduct as defined in the Plan, and the Corporation may demand repayment of amounts received upon exercise on or after the date of the Misconduct. See the terms of the Plan for additional information.

TAXATION. The tax consequences of Stock Option Awards vary, and, depending on the country’s laws that govern this Stock Option Award, taxation can be triggered upon events such as the grant, vest, and/or exercise of such Stock Option Award. Consult the prospectus or prospectus supplement and your tax advisor for more information regarding the tax consequences of your Stock Option Award. For a copy of the prospectus or prospectus supplement, go to http://hr.chevron.com/northamerica/us/payprograms/executiveplans/ltip.asp or the Global Executive Plans Web site at http://hr.chevron.com/globalprograms/execplans/ltip.aspx


M.	ADJUSTMENTS. In the event of any change in the outstanding shares of Common Stock by reason of any stock dividend or split, recapitalization, reclassification, merger, consolidation, or other similar corporate change, the number of stock options and the Exercise Price of the Stock Option Award under this agreement shall be adjusted, as appropriate.

NON-TRANSFERABILITY OF AWARD. You are not permitted to sell, transfer, pledge, assign or encumber this Stock Option Award during your lifetime. Notwithstanding the foregoing, this Stock Option Award may be transferred or assigned after your death to your beneficiary or according to the laws of descent in your jurisdiction or pursuant to a domestic relations order enforceable under applicable law.


O.	BENEFICIARY DESIGNATION. You may designate a beneficiary for your Stock Option Award upon your death at https://www.benefitsweb.com/chevron.html. Non-U.S. payroll employees may download a beneficiary designation form from the Global Executive Plans Web page at http://hr.chevron.com/globalprograms/execplans/docs/GO76VnonUS.pdf.

ABILITY TO SUBSTITUTE. The Management Compensation Committee shall have the ability to substitute, without receiving participant permission, Stock Appreciation Rights (SARs) paid only in stock for outstanding options; provided, that the number of substituted SARs equals the number of shares underlying the options and the Exercise Price of the SARs is equal to the Exercise Price of the options.

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