PNC Bank 2005 Annual Report Download - page 139

THE PNC FINANCIAL SERVICES GROUP, INC.
1997 LONG-TERM INCENTIVE AWARD PLAN
NONSTATUTORY STOCK OPTION AGREEMENT
ANNEX A
CERTAIN DEFINITIONS
Except where the context otherwise indicates, the following definitions apply to the
Nonstatutory Stock Option Agreement (“Agreement”) to which this Annex A is attached.
A.1 “Board” means the Board of Directors of PNC.
A.2 “Cause.”
(a) “Cause” during a Coverage Period. If the termination of Optionee’ s employment with the
Corporation occurs during a Coverage Period, then, for purposes of the Agreement, “Cause”
means:
(i) the willful and continued failure of Optionee to substantially perform Optionee’ s duties with
the Corporation (other than any such failure resulting from incapacity due to physical or mental
illness), after a written demand for substantial performance is delivered to Optionee by the
Board or the CEO that specifically identifies the manner in which the Board or the CEO believes
that Optionee has not substantially performed Optionee’ s duties; or
(ii) the willful engaging by Optionee in illegal conduct or gross misconduct that is materially
and demonstrably injurious to PNC or any Subsidiary.
For purposes of the preceding clauses (i) and (ii), no act or failure to act, on the part of Optionee,
shall be considered willful unless it is done, or omitted to be done, by Optionee in bad faith and
without reasonable belief that Optionee’ s action or omission was in the best interests of the
Corporation. Any act, or failure to act, based upon the instructions or prior approval of the
Board, the CEO or Optionee’ s superior or based upon the advice of counsel for the Corporation,
shall be conclusively presumed to be done, or omitted to be done, by Optionee in good faith and
in the best interests of the Corporation.
The cessation of employment of Optionee will be deemed to be a termination of Optionee’ s
employment with the Corporation for Cause for purposes of the Agreement only if and when
there shall have been delivered to Optionee, as part of the notice of Optionee’ s termination, a
copy of a resolution duly adopted by the affirmative vote of not less than a majority of the entire
membership of the Board, at a Board meeting called and held for the purpose of considering
such termination, finding on the basis of clear and convincing evidence that, in the good faith
opinion of the Board, Optionee is guilty of conduct described in clause (i) or (ii) above and, in
either case, specifying the particulars thereof in detail. Such resolution shall be adopted only
after (1) reasonable notice of such Board meeting is provided to Optionee, together with written
notice that PNC believes that Optionee is guilty of conduct described in clause (i) or (ii) above
and, in either case, specifying the particulars thereof in detail, and (2) Optionee is given an
opportunity, together with counsel, to be heard before the Board.
(b) “Cause” other than during a Coverage Period. If the termination of Optionee’ s employment
with the Corporation occurs other than during a Coverage Period, then, for purposes of the
Agreement, “Cause” means:
(i) the willful and continued failure of Optionee to substantially perform Optionee’ s duties with
the Corporation (other than any such failure resulting from incapacity due to physical or mental
illness), after a written demand for substantial performance is delivered to Optionee by PNC that