Colfax Corporation 8-K [cfx-8k_052020.htm]

 

Exhibit 10.1 

 

 

 

COLFAX CORPORATION

 

2020 OMNIBUS INCENTIVE PLAN

 

 

 

 

Table of Contents

 

 

 

 

 

 

 

 

Page

 

 

 

 

SECTION 1.      PURPOSE

1

SECTION 2.      DEFINITIONS

1

SECTION 3.      ADMINISTRATION OF THE PLAN

8

3.1

 

Board

8

3.2

 

Committee

8

3.3

 

Committee Authority

9

3.4

 

Deferral Arrangement

10

3.5

 

No Liability

10

3.6

 

Share Issuance/Book-Entry

11

SECTION 4.      STOCK SUBJECT TO THE PLAN

11

4.1

 

Number of Shares

11

4.2

 

Incentive Stock Options

11

4.3

 

Prior Plan

11

4.4

 

Share Counting

11

4.5

 

Source of Shares of Stock

12

4.6

 

Fractional Shares of Stock

12

SECTION 5.      EFFECTIVE DATE, DURATION AND AMENDMENTS

12

5.1

 

Effective Date

12

5.2

 

Term

12

5.3

 

Amendment and Termination of the Plan

13

SECTION 6.      AWARD ELIGIBILITY AND LIMITATIONS

13

6.1

 

Service Providers

13

6.2

 

Successive Awards and Substitute Awards

13

6.3

 

Limitation on Awards to Outside Directors

13

6.4

 

Maximum Awards

13

SECTION 7.      AWARD AGREEMENT

14

SECTION 8.      TERMS AND CONDITIONS OF OPTIONS

14

8.1

 

Option Price

14

8.2

 

Vesting

14

8.3

 

Term

14

8.4

 

Termination of Service

14

8.5

 

Limitations on Exercise of Option

15

8.6

 

Method of Exercise

15

 

 

-i- 

 

 

Table of Contents

(continued)

 

 

 

 

Page

       

8.7

 

Rights of Holders of Options

15

8.8

 

Delivery of Stock

15

8.9

 

Transferability of Options

15

8.10

 

Family Transfers

15

8.11

 

Limitations on Incentive Stock Options

16

8.12

 

Notice of Disqualifying Disposition

16

8.13

 

No Reloads

16

8.14

 

No Repricing

16

SECTION 9.      TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS

16

9.1

 

Right to Payment and Grant Price

16

9.2

 

Other Terms

16

9.3

 

Term

17

9.4

 

Transferability of SARS

17

9.5

 

Family Transfers

17

9.6

 

No Repricing

17

SECTION 10.      TERMS AND CONDITIONS OF RESTRICTED STOCK AND STOCK UNITS

17

10.1

 

Grant of Restricted Stock or Stock Units

17

10.2

 

Restrictions; Minimum Vesting

18

10.3

 

Restricted Stock Certificates

18

10.4

 

Rights of Holders of Restricted Stock

18

10.5

 

Rights of Holders of Stock Units

18

10.6

 

Purchase of Restricted Stock

19

10.7

 

Delivery of Stock

19

SECTION 11.      TERMS AND CONDITIONS OF UNRESTRICTED STOCK AWARDS

19

SECTION 12.      FORM OF PAYMENT FOR OPTIONS AND RESTRICTED STOCK

19

12.1

 

General Rule

19

12.2

 

Surrender of Stock

19

12.3

 

Cashless Exercise; Net Exercise

19

12.4

 

Other Forms of Payment

20

SECTION 13.      TERMS AND CONDITIONS OF DIVIDEND EQUIVALENT RIGHTS

20

13.1

 

Dividend Equivalent Rights

20

 

 

-ii- 

 

 

Table of Contents

(continued)

 

 

 

 

Page

 

 

 

 

SECTION 14.     TERMS AND CONDITIONS OF PERFORMANCE SHARES AND PERFORMANCE UNITS
AWARDS

20

14.1

 

Grant of Performance Units/Performance Shares

20

14.2

 

Award Agreement

21

14.3

 

Performance Objectives

21

14.4

 

Timing For Establishing Performance Goals

21

14.5

 

Settlement of Performance Awards; Other Terms

21

14.6

 

Performance Measures

21

14.7

 

Dividends and Dividend Equivalents

22

14.8

 

Minimum Vesting Requirements

22

SECTION 15.      PARACHUTE LIMITATIONS

22

SECTION 16.      REQUIREMENTS OF LAW

23

16.1

 

General

23

16.2

 

Rule 16b-3

23

SECTION 17.      ADJUSTMENTS FOR CHANGES IN CAPITALIZATION

24

17.1

 

Mandatory Adjustments

24

17.2

 

Discretionary Adjustments

24

17.3

 

No Fractional Shares, etc.

24

17.4

 

No Limitations on Company

25

SECTION 18.      GENERAL PROVISIONS

25

18.1

 

Disclaimer of Rights

25

18.2

 

Nonexclusivity of the Plan

25

18.3

 

Withholding Taxes

25

18.4

 

Captions

26

18.5

 

Other Provisions

26

18.6

 

Number and Gender

26

18.7

 

Severability

26

18.8

 

Governing Law

26

18.9

 

Section 409A of the Code

26

18.10

 

Clawback/Recoupment

27

Appendix A

 

 

 

-iii- 

 

 

Colfax Corporation

 

2020 Omnibus Incentive Plan

 

Colfax Corporation, a Delaware corporation, sets forth herein the terms of its
2020 Omnibus Incentive Plan, as follows:

 

Section 1.         PURPOSE

 

The Plan is intended to enhance the Company’s and its Affiliates’ (as defined
herein) ability to attract and retain highly qualified officers, directors, and
key employees, and to motivate such persons to serve the Company and its
Affiliates and to expend maximum effort to improve the business results and
earnings of the Company, by providing to such persons an opportunity to acquire
or increase a direct proprietary interest in the operations and future success
of the Company.

 

Section 2.         DEFINITIONS

 

For purposes of interpreting the Plan and related documents (including Award
Agreements), the following capitalized terms shall have the respective meanings
set forth below:

 

2.1       “Affiliate” means, with respect to the Company, any company or other
trade or business that controls, is controlled by or is under common control
with the Company within the meaning of Rule 405 of Regulation C under the
Securities Act, including, without limitation, any Subsidiary.  For purposes of
granting stock options or stock appreciation rights, an entity may not be
considered an Affiliate if it results in noncompliance with Code Section 409A.

 

2.2       “Award” means a grant of an Option, Stock Appreciation Right,
Restricted Stock, Unrestricted Stock, Stock Unit, Dividend Equivalent Right,
Performance Share, Performance Unit or Substitute Award under the Plan.

 

2.3       “Award Agreement” means the written agreement between the Company and
a Grantee that evidences and sets out the terms and conditions of an Award.  An
Award Agreement may be provided in any medium, including any electronic medium.

 

2.4       “Benefit Arrangement” has the meaning set forth in Section 15.

 

2.5       “Board” means the Board of Directors of the Company.

 

2.6       “Business Combination” has the meaning set forth in Section 2.8(3).

 

2.7       “Cause” means, as determined by the Board or the Committee and unless
otherwise provided in an Award Agreement or other applicable agreement with the
Company: (i) gross negligence or willful misconduct in connection with the
performance of duties; (ii) conviction of a criminal offense (other than minor
traffic offenses); (iii) material breach of any term of any employment,
consulting or other services, confidentiality, intellectual property or
non-competition agreements, if any, between the Service Provider and the Company
or any Affiliate.

  

 - 1 -

 

 

2.8       “Change in Control” means the occurrence of any of the following:

 

 

(1)

the acquisition by any individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of more than fifty percent (50%) of either: (A) the then-outstanding shares of
common stock of the Company (the “Company Common Stock”) or (B) the combined
voting power of the then-outstanding voting securities of the Company entitled
to vote generally in the election of directors (“Voting Stock”); provided,
however, that for purposes of this subsection (1), the following acquisitions
shall not constitute a Change in Control: (i) any acquisition directly from the
Company, (ii) any acquisition by the Company, (iii) any acquisition by any
employee benefit plan (or related trust) sponsored or maintained by the Company
or any Subsidiary, (iv) any acquisition by any Person (or more than one Person
acting as a group) that owns more than fifty (50) percent of the Company Common
Stock or Voting Stock and acquires additional shares, or (v) any acquisition by
any Person pursuant to a transaction which complies with clauses (A), (B) and
(C) of subsection (3) below; or

 

 

(2)

individuals who, as of the date hereof, constitute the Board (as modified by
this subsection (2), the “Incumbent Board” ), cease for any reason (other than
death or disability) to constitute at least a majority of the Board; provided,
however, that any individual becoming a director subsequent to the date hereof
whose election, or nomination for election by the Company’s stockholders, was
approved by a vote of at least a majority of the directors then comprising the
Incumbent Board (either by a specific vote or by approval of the proxy statement
of the Company in which such person is named as a nominee for director, without
objection to such nomination) shall be considered as though such individual were
a member of the Incumbent Board, but excluding for this purpose, any such
individual whose initial assumption of office occurs as a result of an actual or
threatened election contest with respect to the election or removal of directors
or other actual or threatened solicitation of proxies or consents by or on
behalf of a Person other than the Board; or

 

 - 2 -

 

 

 

(3)

consummation of a reorganization, merger or consolidation or sale or other
disposition of all or substantially all of the assets of the Company (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, respectively, of the Company Common Stock and Voting
Stock immediately prior to such Business Combination beneficially own, directly
or indirectly, more than fifty percent (50%) of, respectively, the
then-outstanding shares of common stock and the combined voting power of the
then-outstanding voting securities entitled to vote generally in the election of
directors, as the case may be, of the entity resulting from such Business
Combination (including, without limitation, an entity which as a result of such
transaction owns the Company or all or substantially all of the Company’s assets
either directly or through one or more subsidiaries) in substantially the same
proportions relative to each other as their ownership, immediately prior to such
Business Combination, of the Company Common Stock and Voting Stock of the
Company, as the case may be, (B) no Person (excluding any entity resulting from
such Business Combination or any employee benefit plan (or related trust)
sponsored or maintained by the Company or such entity resulting from such
Business Combination) beneficially owns, directly or indirectly, more than fifty
percent (50%), respectively, the then-outstanding shares of common stock of the
entity resulting from such Business Combination, or the combined voting power of
the then-outstanding voting securities of such corporation except to the extent
that such ownership existed prior to the Business Combination and (C) at least a
majority of the members of the board of directors of the corporation resulting
from such Business Combination were members of the Incumbent Board at the time
of the execution of the initial agreement, or of the action of the Board
providing for such Business Combination; or

 

 

(4)

approval by the stockholders of the Company of a complete liquidation or
dissolution of the Company.

 

A “Change in Control” will be deemed to occur (i) with respect to  a Change in
Control pursuant to subsection (1) above, on the date that any Person becomes
the beneficial owner of more than fifty percent (50%) of either the Company
Common Stock or the Voting Stock, (ii) with respect to a Change in Control
pursuant to subsection (2) above, on the date the members of the Incumbent Board
first cease for any reason (other than death or disability) to constitute at
least a majority of the Board, (iii) with respect to a Change in Control
pursuant to subsection (3) above, on the date the applicable transaction closes
and (iv) with respect to a Change in Control pursuant to subsection (4) above,
on the date of the stockholder approval.  Notwithstanding the foregoing
provisions, a “Change in Control” shall not be deemed to have occurred for
purposes of this Agreement solely because of a change in control of any
Subsidiary by which the Employee may be employed.

 

2.9       “Code” means the Internal Revenue Code of 1986, as now in effect or as
hereafter amended.

 

2.10     “Committee” means a committee of, and designated from time to time by
resolution of, the Board, which shall be constituted as provided in Section 3.

 

2.11     “Company” means Colfax Corporation, a Delaware corporation, or its
successors.

 

2.12     “Company Common Stock” has the meaning set forth in Section 2.8(1).

 

 

 - 3 -

 

 

2.13     “Disability” means the Grantee is unable to perform each of the
essential duties of such Grantee’s position by reason of a medically
determinable physical or mental impairment which is potentially permanent in
character or which can be expected to last for a continuous period of not less
than twelve (12) months; provided, however, that, with respect to rules
regarding expiration of an Incentive Stock Option following termination of the
Grantee’s Service, Disability shall mean the Grantee is unable to engage in any
substantial gainful activity by reason of a medically determinable physical or
mental impairment which can be expected to result in death or which has lasted
or can be expected to last for a continuous period of not less than twelve
(12) months.

 

2.14     “Dividend Equivalent Right” and “Dividend Equivalent” means a right,
granted to a Grantee under Section 13 hereof, to receive cash, Stock, other
Awards or other property in an amount equal in value to the dividends paid with
respect to all or a specified number of shares of Stock, or other periodic
payments.

 

2.15     “Effective Date” means the date on which the Plan is approved by the
Company’s stockholders.

 

2.16     “Exchange Act” means the Securities Exchange Act of 1934, as now in
effect or as hereafter amended.

 

2.17     “Exercise Price” means (a) in the case of an Option, the amount for
which a share  of Stock may be purchased upon exercise of such Option, as set
forth in the applicable Award Agreement, and (b) in the case of a Stock
Appreciation Right, the per share of Stock amount, as specified in the
applicable Award Agreement, which is subtracted from the Fair Market Value of a
share of Stock in determining the amount payable upon exercise of such SAR.

 

2.18     “Fair Market Value” means the value of a share of Stock, determined as
follows: if on the Grant Date or other determination date the Stock is listed on
an established national or regional stock exchange, is admitted to quotation on
The Nasdaq Stock Market, Inc. or is publicly traded on an established securities
market, the Fair Market Value of a share of Stock shall be the closing price of
the Stock on such exchange or in such market (if there is more than one such
exchange or market the Board or the Committee shall determine the appropriate
exchange or market) on the Grant Date or such other determination date (or if
there is no such reported closing price, the Fair Market Value shall be the
average between the highest bid and lowest asked prices or between the high and
low sale prices on such trading day) or, if no sale of Stock is reported for
such trading day, on the next preceding day on which any sale shall have been
reported.  If the Stock is not listed on such an exchange, quoted on such system
or traded on such a market, Fair Market Value shall be the value of the Stock as
determined by the Board or the Committee in good faith in a manner consistent
with Code Section 409A.

 

2.19     “Family Member” means a person who is a spouse, former spouse, child,
stepchild, grandchild, parent, stepparent, grandparent, niece, nephew,
mother-in-law, father-in-law, son-in-law, daughter-in-law, brother, sister,
brother-in-law, or sister-in-law, including adoptive relationships, of the
Grantee, any person sharing the Grantee’s household (other than a tenant or
employee), a trust in which any one or more of these persons have more than
fifty percent (50%) of the beneficial interest, a foundation in which any one or
more of these persons (or the Grantee) control the management of assets, and any
other entity in which one or more of these persons (or the Grantee) own more
than fifty percent (50%) of the voting interests.

 

 

 - 4 -

 

 

2.20     “Full Value Award” means any Award, other than an Option or Stock
Appreciation Right, that is settled by the issuance of shares of Stock (or, at
the direction of the Committee, settled in cash or other consideration by
reference to the value of shares of Stock).

 

2.21     “Grant Date” means the date on which the Board or Committee, as
applicable, adopts a resolution or takes other appropriate action, granting an
Award to a Service Provider or, if a later date is set forth in such resolution,
then such later date as set forth therein.

 

2.22     “Grantee” means a person who receives or holds an Award under the Plan.

 

2.23     “Incentive Stock Option” means an “incentive stock option” within the
meaning of Section 422 of the Code, or the corresponding provision of any
subsequently enacted tax statute, as amended from time to time.

 

2.24     “Incumbent Board” has the meaning set forth in Section 2.8(2).

 

2.25     “Minimum Vesting Requirements” means, notwithstanding any provision of
this Plan to the contrary, on and after the Effective Date, the Committee shall
not award more than five percent (5%) of the aggregate number of shares of Stock
that are available for grant under this Plan as of the Effective Date pursuant
to Awards that are solely subject to vesting conditions or performance periods
that are less than one (1) year following the Grant Date of the applicable
Award, subject, in each case to the Committee’s authority under this Plan to
vest Awards earlier, as the Committee deems appropriate, upon the occurrence of
a Change in Control, in the event of a Service Provider’s termination of
employment or Service or otherwise as permitted by this Plan.

 

2.26     “Net Exercise” means a Grantee’s ability (if authorized by the Board or
the Committee) to exercise an Option by directing the Company to deduct from the
shares of Stock issuable upon exercise of his or her Option a number of shares
of Stock having an aggregate Fair Market Value equal to the sum of the aggregate
Option Price therefor plus the amount of the Grantee’s tax withholding described
in Section 18.3 (if any), whereupon the Company shall issue to the Grantee the
net remaining number of shares of Stock after such deduction.

 

2.27     “Non-qualified Stock Option” means an Option that is not an Incentive
Stock Option.

 

2.28     “Option” means an option to purchase one or more shares of Stock
pursuant to the Plan that is either an Incentive Stock Option or a Non-qualified
Stock Option.

 

2.29     “Option Price” means the Exercise Price for each share of Stock subject
to an Option.

 

2.30     “Other Agreement” has the meaning set forth in Section 15.

 

2.31     “Outside Director” means a member of the Board who is not an officer or
employee of the Company.

 

 - 5 -

 

 

2.32     “Performance Award” means an Award made subject to the attainment of
one or more performance goals (as described in Section 14) over a Performance
Period of up to ten (10) years.

 

2.33     “Performance-Based Compensation” means compensation under an Award that
is intended to constitute performance-based compensation within the meaning of
Code Section 409A.

 

2.34     “Performance Measures”  means measures as described in Section 14 and
Appendix A on which the performance goals are based.

 

2.35     “Performance Period” means the period of time not in excess of ten (10)
years during which the performance goals must be met in order to determine the
degree of payout and/or vesting with respect to a Performance Award.

 

2.36     “Performance Share” means a Performance Award under Section 14 hereof
and subject to the terms of this Plan, denominated in Stock, the value of which
at the time it is payable is determined as a function of the extent to which
corresponding performance criteria have been achieved.

 

2.37     “Performance Unit” means a Performance Award under Section 14 hereof
and subject to the terms of this Plan, denominated in Stock Units, the value of
which at the time it is payable is determined as a function of the extent to
which corresponding performance criteria have been achieved.

 

2.38     “Person” has the meaning set forth in Section 2.8(1).

 

2.39     “Plan” means this Colfax Corporation 2020 Omnibus Incentive Plan, as
the same may be amended from time to time.

 

2.40     “Prior Plan” means the Colfax Corporation 2016 Omnibus Incentive Plan.

 

2.41     “Purchase Price” means the purchase price paid by a Grantee for each
share of Stock pursuant to a grant of Restricted Stock or Unrestricted Stock.

 

2.42     “Reporting Person” means a person who is required to file reports under
Section 16(a) of the Exchange Act.

 

2.43     “Repricing” and “Repriced” means lowering of the Option Price or SAR
Exercise Price or any other action that has the same effect or is treated as a
repricing under generally accepted accounting principles, and includes a
cancellation of an Option or SAR when its Option Price or SAR Exercise Price
exceeds the Fair Market Value of the underlying Stock and exchange for another
Option, SAR or other Award or a cash payment.

 

2.44     “Restricted Period” has the meaning set forth in Section 10.2.

 

2.45     “Restricted Stock” means one or more shares of Stock, awarded to a
Grantee pursuant to Section 10 hereof.

 

 - 6 -

 

 

2.46     “SAR Exercise Price” means the per share Exercise Price of an SAR
granted to a Grantee under Section 9 hereof.

 

2.47     “Securities Act” means the Securities Act of 1933, as now in effect or
as hereafter amended.

 

2.48     “Service” means (i) such term as defined in an applicable Award
Agreement, if the Award Agreement so defines such term, or (ii) if not defined
in an applicable Award Agreement, service as a Service Provider to the Company
or an Affiliate.  Unless otherwise stated in the applicable Award Agreement, a
Grantee’s change in position or duties and periods of leave following which a
Service Provider is expected to return to service with the Company or an
Affiliate shall not result in interrupted or terminated Service, so long as such
Grantee continues to be a Service Provider to the Company or an Affiliate.  Any
periods of garden leave prior to a Service Provider’s termination of service
with the Company or an Affiliate shall not be considered periods of “Service”
hereunder, unless the Committee determines otherwise.  Subject to the preceding,
whether a termination of Service shall have occurred for purposes of the Plan
shall be determined by the Board or the Committee, which determination shall be
final, binding and conclusive.

 

2.49     “Service Provider” means an employee, officer or director of the
Company or an Affiliate, currently providing services to the Company or an
Affiliate.

 

2.50     “Share Counting” has the meaning set forth in Section 4.4.

 

2.51     “Stock” means the common stock, par value $0.001 per share, of the
Company.

 

2.52     “Stock Appreciation Right” or “SAR” means a right granted to a Grantee
under Section 9 hereof.

 

2.53     “Stock Unit” means a bookkeeping entry representing the equivalent of
one share of Stock awarded to a Grantee pursuant to Section 10 hereof.

 

2.54     “Subsidiary” means any “subsidiary corporation” of the Company within
the meaning of Section 424(f) of the Code.

 

2.55     “Substitute Award” means an Award granted upon assumption of, or in
substitution for, an outstanding award previously granted by a company or other
entity acquired by the Company or any Affiliate or with which the Company or any
Affiliate combines.

 

2.56     “Ten Percent Stockholder” means an individual who owns more than ten
percent (10%) of the total combined voting power of all classes of outstanding
stock of the Company, its parent or any of its Subsidiaries, within the meaning
of Section 422(b)(6) of the Code.  In determining stock ownership, the
attribution rules of Section 424(d) of the Code shall be applied.

 

2.57     “Total Available Shares” has the meaning set forth in Section 4.1.

 

2.58     “Unrestricted Stock” means one or more shares of Stock, awarded to a
Grantee pursuant to Section 11 hereof.

 

 - 7 -

 

 

2.59     “Voting Stock” has the meaning set forth in Section 2.8(1).

 

Section 3.         ADMINISTRATION OF THE PLAN

 

3.1       Board.  The Board shall have such powers and authorities related to
the administration of the Plan as are consistent with the Company’s certificate
of incorporation and by-laws and applicable law.  The Board shall have full
power and authority to take all actions and to make all determinations required
or provided for under the Plan, any Award or any Award Agreement, and shall have
full power and authority to take all such other actions and make all such other
determinations not inconsistent with the specific terms and provisions of the
Plan that the Board deems to be necessary or appropriate to the administration
of the Plan, any Award or any Award Agreement.  All such actions and
determinations shall be by the affirmative vote of a majority of the members of
the Board present at a meeting or by unanimous consent of the Board executed in
writing in accordance with the Company’s certificate of incorporation and
by-laws and applicable law.  The interpretation and construction by the Board of
any provision of the Plan, any Award or any Award Agreement shall be final,
binding and conclusive.

 

3.2       Committee.  The Board hereby delegates to the Compensation Committee
of the Board, which shall be the Committee hereunder until such time as a
replacement Committee is so designated by the Board, such powers and authorities
related to the administration and implementation of the Plan, as set forth in
Section 3.1 above and Section 3.3 below.

 

(i)         Except as provided in Subsection (ii) and except as the Board may
otherwise determine, the Committee, and any successor thereto appointed by the
Board to administer the Plan shall consist of two or more Outside Directors of
the Company who meet such requirements as may be established from time to time
by the Securities and Exchange Commission for plans intended to qualify for
exemption under Rule 16b-3 (or its successor) under the Exchange Act, and who
comply with the independence requirements of the stock exchange on which the
Stock is listed.

 

(ii)        The Board may also appoint one or more separate committees, each
composed of one or more directors of the Company who need not be Outside
Directors or one or more officers of the Company who need not be members of the
Board, who may, within specified parameters, administer the Plan with respect to
employees or other Service Providers who are not officers or directors of the
Company, may grant Awards under the Plan to such employees or other Service
Providers, and may determine all terms of such Awards.

 

(iii)       The Committee may delegate to any appropriate officer or employee of
the Company or an Affiliate responsibility for performing ministerial and
administrative functions under the Plan.

 

(iv)       In the event that the Committee’s authority is delegated to any
officer or employee in accordance with this Section 3.2, any actions undertaken
by such person in accordance with the Committee’s delegation of authority shall
have the same force and effect as if undertaken directly by the Committee, and
any reference in the Plan to the Committee shall, to the extent consistent with
the terms and limitations of such delegation, be deemed to include a reference
to such officer or employee.

  

 - 8 -

 

 

In the event that the Plan, any Award or any Award Agreement entered into
hereunder provides for any action to be taken by or determination to be made by
the Board, such action may be taken or such determination may be made by the
Committee if the power and authority to do so has been delegated to the
Committee by the Board as provided for in this Section.  Unless otherwise
expressly determined by the Board, any such action or determination by the
Committee shall be final, binding and conclusive.  To the extent permitted by
law, the Committee may delegate its authority under the Plan to a member of the
Board.

 

3.3       Committee Authority.  Subject to the other terms and conditions of the
Plan, the Committee shall have full and final authority to:

 

(i)         designate Grantees;

 

(ii)        determine the type or types of Awards to be made to a Grantee;

 

(iii)       determine the number of shares of Stock to be subject to an Award;

 

(iv)       subject to the Minimum Vesting Requirements, establish the terms,
conditions, restrictions and other provisions of each Award (including, but not
limited to, the exercise price of any Option, the nature and duration of any
restriction or condition (or provision for lapse thereof) relating to the
vesting, exercise, transfer, or forfeiture of an Award or the shares of Stock
subject thereto, and any terms or conditions that may be necessary to qualify
Options as Incentive Stock Options);

 

(v)        prescribe the form of each Award Agreement evidencing an Award, which
need not be identical for each Grantee;

 

(vi)       Grant Awards;

 

(vii)      Establish performance conditions and goals for Performance Awards,
and verify the level of performance attained with respect to such performance
conditions and goals;

 

(viii)      Adopt sub-plans or supplements to, or alternative versions of, the
Plan as the Committee deems necessary or desirable to comply with laws or
regulations or to accommodate the tax policy or custom of, foreign
jurisdictions.

 

(ix)       correct any defect, supply any omission or reconcile any
inconsistency in this Plan, any Award or any Award Agreement,

 

(x)        establish, adopt or revise rules, guidelines and policies for the
administration of the Plan;

 

 - 9 -

 

 

(xi)       amend, modify, or supplement the terms of any outstanding Award. 
Such authority specifically includes the authority, in order to effectuate the
purposes of the Plan but without amending the Plan, to modify Awards to eligible
individuals who are foreign nationals or are individuals who are employed
outside the United States to recognize differences in local law, tax policy, or
custom.  Notwithstanding the foregoing, no amendment, modification or supplement
of any Award shall, without the consent of the Grantee, materially impair the
Grantee’s rights under such Award.  In addition, notwithstanding anything in the
Plan to the contrary, the Committee shall not have the discretion to accelerate
the vesting of any outstanding Awards, except that the Committee may accelerate
the vesting of Awards in the event of a Grantee’s death or Disability or as
provided in Section 17 of the Plan; and

 

(xii)      make all other decisions and determinations, and take such other
actions with respect to the Plan or any Award as the Committee shall deem
necessary, appropriate or advisable for the administration of the Plan and any
Award.

 

The express grant of any specific power to the Committee, and the taking of any
action by the Committee, shall not be construed as limiting any power or
authority of the Committee.  The Company may retain the right in an Award
Agreement to cause a forfeiture of the gain realized by a Grantee on account of
actions taken by the Grantee in violation or breach of or in conflict with any
employment agreement, non-competition agreement, any agreement prohibiting
solicitation of employees or clients of the Company or any Affiliate thereof or
any confidentiality obligation with respect to the Company or any Affiliate
thereof or otherwise in competition with the Company or any Affiliate thereof,
to the extent specified in such Award Agreement applicable to the Grantee. 
Furthermore, the Company may annul an Award if the Grantee is an employee of the
Company or an Affiliate thereof and is terminated for Cause.

 

3.4       Deferral Arrangement.  The Board or the Committee may permit or
require the deferral of any Award payment into a deferred compensation
arrangement, subject to such rules and procedures as it may establish, which may
include provisions for the payment or crediting of interest or dividend
equivalents, including converting such credits into deferred Stock equivalents. 
Any such deferrals shall be made in a manner that complies with Code
Section 409A.

 

3.5       No Liability.  No member of the Board or of the Committee shall be
liable for any action or determination made in good faith with respect to the
Plan or any Award or Award Agreement.

 

3.6       Share Issuance/Book-Entry.  Notwithstanding any provision of this Plan
to the contrary, the issuance of shares of Stock under the Plan may be evidenced
in such a manner as the Board or Committee, in its discretion, deems
appropriate, including, without limitation, book-entry registration on a
non-certificated basis or issuance of one or more Stock certificates, subject to
applicable law and the rules of the applicable stock exchange.  Any reference to
the issuance of Stock certificates to a Grantee shall be deemed to include any
such issuance of the Stock.

 

Section 4.         STOCK SUBJECT TO THE PLAN

 

4.1       Number of Shares.  Subject to the Share Counting rules set forth in
Section 4.4 and to adjustment as provided in Section 17, the aggregate number of
shares of Stock reserved and available for issuance pursuant to Awards granted
under the Plan shall be 4,430,000 shares, which number may be increased by the
number of shares available for issuance under a stockholder-approved plan of a
business entity that is a party to an acquisition, merger or other transaction
in which the Company or an Affiliate acquires the business entity (as
appropriately adjusted, if necessary, to reflect such transaction) (“Total
Available Shares”).

 

 - 10 -

 

 

4.2       Incentive Stock Options.  The maximum number of shares of Stock that
may be issued upon exercise of Incentive Stock Options granted under the Plan
shall be 4,430,000 shares, subject to adjustment as provided in Section 17.

 

4.3       Prior Plan.  On or after the Effective Date, no further awards shall
be granted under the Prior Plan, it being understood that awards granted under
the Prior Plan as of the Effective Date shall remain in full force and effect
under the Prior Plan according to their respective terms.

 

4.4       Share Counting.

 

(i)         The number of shares of Stock covered by an Award, or to which an
Award relates, shall be subtracted from the Total Available Shares reserve as of
the Grant Date.

 

(ii)        To the extent an Award is canceled, terminates, expires, is
forfeited or lapses for any reason (in whole or in part), any unissued or
forfeited shares of Stock subject to the Award shall be added back to the Total
Available Shares reserve and available again for issuance pursuant to Awards
granted under the Plan.

 

(iii)       Any shares of Stock related to Awards that are settled in cash or
other consideration in lieu of shares of Stock shall be added back to the Total
Available Shares reserve and available again for issuance pursuant to Awards
granted under the Plan.

 

(iv)       Shares of Stock withheld or deducted from an Award by the Company to
satisfy tax withholding requirements relating to  Options or Stock Appreciation
Rights shall not be added back to the Total Available Shares reserve and shall
not again be available for issuance pursuant to Awards granted under the Plan,
but shares of Stock withheld or deducted by the Company to satisfy tax
withholding requirements relating to Full Value Awards shall be added back to
the Total Available Shares reserve and available again for issuance pursuant to
Awards granted under the Plan.  Shares of Stock delivered by a Grantee to the
Company to satisfy tax withholding requirements shall be treated in the same way
as shares of Stock withheld or deducted from an Award as specified above for
purposes of Share Counting under this Section 4.4.

 

(v)        If the full number of shares of Stock subject to an Option or a
Stock-settled Stock Appreciation Right is not issued upon exercise of such
Option or Stock Appreciation Right for any reason, including by reason of a net
settlement or Net Exercise, all such shares of Stock that were covered by the
exercised Option or SAR shall not be added back to the Total Available Shares
reserve and shall not again be available for issuance pursuant to Awards granted
under the Plan.

 

(vi)       If the Exercise Price of an Option is satisfied by the Grantee
delivering shares of Stock to the Company (by either actual delivery or
attestation), such shares of Stock shall not be added to the Total Available
Shares reserve and shall not be available for issuance pursuant to Awards
granted under the Plan.

 

 - 11 -

 

 

(vii)      To the extent that the full number of shares of Stock subject to a
Performance Award (other than an Option or Stock Appreciation Right) is not
issued by reason of failure to achieve maximum performance goals, the number of
shares of Stock not issued shall be added back to the Total Available Shares
reserve and shall be available again for issuance pursuant to Awards granted
under the Plan.

 

(viii)      Shares of Stock repurchased on the open market with the proceeds of
an Option exercise shall not be added to the Total Available Shares reserve and
shall not be available for issuance pursuant to Awards granted under the Plan.

 

(ix)       Any Dividend Equivalent denominated in shares of Stock shall be
counted against the Total Available Shares in such amount and at such time as
the Dividend Equivalent first constitutes a commitment to issue shares of Stock.

 

(x)        Substitute Awards granted shall not count against the Total Available
Shares reserve.

 

4.5       Source of Shares of Stock.  Shares of Stock issued under the Plan may
consist, in whole or in part, of authorized but unissued shares or treasury
shares of Stock.

 

4.6       Fractional Shares of Stock.  No fractional shares of Stock shall be
issued under or pursuant to the Plan or any Award and the Committee shall
determine, in its sole discretion, whether cash shall be given in lieu of
fractional shares of Stock or whether such fractional shares of Stock shall be
eliminated by rounding down.

 

Section 5.         EFFECTIVE DATE, DURATION AND AMENDMENTS

 

5.1       Effective Date.  The Plan shall be effective on the Effective Date.

 

5.2       Term.  The Plan shall terminate automatically on the ten (10) year
anniversary of the Effective Date set forth in Section 5.1 and may be terminated
on any earlier date as provided in Section 5.3.  Any Awards of Incentive Stock
Options shall be granted within the time periods  provided in Section 8.3.  No
termination of the Plan shall have any effect on any Awards then outstanding
under the Plan.

 

5.3       Amendment and Termination of the Plan.  The Board may, at any time and
from time to time, amend, suspend, or terminate the Plan as to any shares of
Stock as to which Awards have not been made.  An amendment shall be contingent
on approval of the Company’s stockholders to the extent stated by the Board,
required by applicable law or required by applicable stock exchange listing
requirements.  No Awards shall be made after termination of the Plan.  No
amendment, suspension, or termination of the Plan shall, without the consent of
the Grantee, materially impair rights or obligations under any Award theretofore
awarded under the Plan.

  

 - 12 -

 

 

Section 6.         AWARD ELIGIBILITY AND LIMITATIONS

 

6.1       Service Providers. Subject to this Section 6, Awards may be made under
the Plan to any Service Provider to the Company or of any Affiliate, including
any Service Provider who is an officer or director of the Company or of any
Affiliate, as the Board or the Committee shall determine and designate from time
to time.

 

6.2       Successive Awards and Substitute Awards.  An eligible person may
receive more than one Award, subject to such restrictions as are provided
herein.  Notwithstanding Sections 8.1 and 9.1, the Option Price of an Option or
the grant price of an SAR that is a Substitute Award may be less than one
hundred percent (100%) of the Fair Market Value of a share of Stock on the
original date of grant; provided, that the Option Price or grant price is
determined in accordance with the principles of Code Section 424, Code
Section 409A, and the regulations thereunder.  Substitute Awards may be granted
(on such terms and conditions as the Committee determines appropriate) in
assumption of, or in substitution or exchange for, stock and stock-based awards
held by employees, directors and other service providers of another entity who,
pursuant to an acquisition (whether by purchase, merger or other Change in
Control) by the Company or an Affiliate, become employees, directors or other
service providers of the Company or an Affiliate.

 

6.3       Limitation on Awards to Outside Directors.  The aggregate dollar value
of equity-based (based on the Grant Date’s Fair Market Value of equity-based
Awards) and cash compensation granted under this Plan or otherwise during any
calendar year to any Outside Director shall not exceed Three Hundred Fifty
Thousand Dollars ($350,000); provided, however, that in the calendar year in
which an Outside Director first joins the Board or is first designated as
Chairman of the Board or Lead Director, the maximum aggregate dollar value of
equity-based and cash compensation granted to the Outside Director may be up to
two hundred percent (200%) of the foregoing limit.

 

6.4       Maximum Awards.  Subject to adjustment as provided in Section 17, the
maximum number of shares of Stock underlying Awards to any one Grantee during
any fiscal year of the Company shall be 1,000,000.

 

Section 7.         AWARD AGREEMENT

 

Each Award granted pursuant to the Plan shall be evidenced by an Award
Agreement, in such form or forms as the Board or the Committee shall from time
to time determine.  Award Agreements granted from time to time or at the same
time need not contain similar provisions but shall be consistent with the terms
of the Plan.  Each Award Agreement evidencing an Award of Options shall specify
whether such Options are intended to be Non-qualified Stock Options or Incentive
Stock Options, and in the absence of such specification such Options shall be
deemed Non-qualified Stock Options.

 

Section 8.         TERMS AND CONDITIONS OF OPTIONS

 

8.1       Option Price.  The Option Price of each Option shall be fixed by the
Board or the Committee and stated in the Award Agreement evidencing such
Option.  Except for Substitute Awards, the Option Price of each Option shall be
at least the Fair Market Value on the Grant Date of a share of Stock;
provided, however, that in the event that a Grantee is a Ten Percent
Stockholder, the Option Price of an Option granted to such Grantee that is
intended to be an Incentive Stock Option shall be not less than one hundred ten
percent (110%) of the Fair Market Value of a share of Stock on the Grant Date. 
In no case shall the Option Price of any Option be less than the par value of a
share of Stock.

 

 - 13 -

 

 

8.2       Vesting.  Subject to Sections 8.3 and 17 hereof, each Option granted
under the Plan shall become exercisable at such times and under such conditions
(including conditions based on achievement of performance goals and/or future
service requirements) as shall be determined by the Board or the Committee and
stated in the Award Agreement.  Except for Substitute Awards and the Minimum
Vesting Requirements, exceptions, Options shall have a vesting period of at
least twelve (12) months from the Grant Date.  For purposes of this Section 8.2,
fractional numbers of shares of Stock subject to an Option shall be rounded down
to the next nearest whole number.

 

8.3       Term.  Each Option granted under the Plan shall terminate, and all
rights to purchase shares of Stock thereunder shall cease, upon the expiration
of ten (10) years from the date such Option is granted, or under such
circumstances and on such date prior thereto as is set forth in the Plan or as
may be fixed by the Board or the Committee and stated in the Award Agreement
relating to such Option; provided, however, that (i) in the event that the
Grantee is a Ten Percent Stockholder, an Option granted to such Grantee that is
intended to be an Incentive Stock Option shall not be exercisable after the
expiration of five (5) years from its Grant Date; and (ii) such term shall be
automatically extended by thirty (30) days (but to no longer than ten (10) years
for any Option that intended to be an Incentive Stock Option or to no longer
than five (5) years for any Option that intended to be an Incentive Stock Option
and is granted to a Ten Percent Stockholder) in the event that the original term
of the Option is set to expire during a closed window period applicable to the
Grantee.  Any Award of an Incentive Stock Option must be made prior to April 3,
2030.

 

8.4       Termination of Service.  Each Award Agreement shall set forth the
extent to which the Grantee shall have the right to exercise the Option
following termination of the Grantee’s Service.  Such provisions shall be
determined in the sole discretion of the Board or the Committee, need not be
uniform among all Options granted pursuant to the Plan, and may reflect
distinctions based on the reasons for termination of Service.

 

8.5       Limitations on Exercise of Option.  Notwithstanding any other
provision of the Plan, in no event may any Option be exercised, in whole or in
part, prior to the date the Plan is approved by the stockholders of the Company
as provided herein or after the occurrence of an event referred to in Section 17
hereof which results in termination of the Option.

 

8.6       Method of Exercise. Subject to such rules and procedures as may be
established by the Board or the Committee, the provisions of this Section 8.6
shall apply to the exercise of Options. An Option that is exercisable may be
exercised by the Grantee’s delivery to the Company of written notice of exercise
on any business day, at the Company’s principal office, on the form specified by
the Company.  Such notice shall specify the number of shares of Stock with
respect to which the Option is being exercised; and, subject to Section 12,
unless the Board or Committee in its discretion permits payment through a
“cashless exercise” or Net Exercise procedure, shall be accompanied by payment
in full of the Option Price of the shares of Stock for which the Option is being
exercised plus the amount (if any) of federal and/or other taxes which the
Company may, in its judgment, be required to withhold with respect to an Award. 
The minimum number of shares of Stock with respect to which an Option may be
exercised, in whole or in part, at any time shall be the lesser of (i) one
hundred (100) shares or such lesser number set forth in the applicable Award
Agreement and (ii) the maximum number of shares available for purchase under the
Option at the time of exercise.

 

 - 14 -

 

 

8.7       Rights of Holders of Options.  An individual holding or exercising an
Option shall have none of the rights of a stockholder (for example, the right to
receive cash or dividend payments or distributions attributable to the subject
shares of Stock or to direct the voting of the subject shares of Stock) until
the shares of Stock covered thereby are fully paid for and issued to the
Grantee.  Except as provided in Section 17 hereof, no adjustment shall be made
for dividends, distributions or other rights for which the record date is prior
to the date of such issuance.

 

8.8       Delivery of Stock.  Promptly after the exercise of an Option by a
Grantee and the payment in full of the Option Price, such Grantee shall be
entitled to the issuance of the shares of Stock subject to the Option pursuant
to Section 3.6.

 

8.9       Transferability of Options.  Except as provided in Section 8.10,
during the lifetime of a Grantee, only the Grantee (or, in the event of legal
incapacity or incompetency, the Grantee’s guardian or legal representative) may
exercise an Option.  Except as provided in Section 8.10, no Option shall be
assignable or transferable by the Grantee to whom it is granted, other than by
will or the laws of descent and distribution.

 

8.10     Family Transfers.  If authorized in the applicable Award Agreement, a
Grantee may transfer, not for value, all or part of an Option which is not an
Incentive Stock Option to any Family Member.  For the purpose of this
Section 8.10, a “not for value” transfer is a transfer which is (i) a gift,
(ii) a transfer under a domestic relations order in settlement of marital
property rights; or (iii) a transfer to an entity in which more than fifty
percent (50%) of the voting interests are owned by Family Members (or the
Grantee) in exchange for an interest in that entity.  Following a transfer under
this Section 8.10, any such Option shall continue to be subject to the same
terms and conditions as were applicable immediately prior to transfer. 
Subsequent transfers of transferred Options are prohibited except to Family
Members of the original Grantee in accordance with this Section 8.10 or by will
or the laws of descent and distribution.  The events of termination of Service
of Section 8.4 hereof shall continue to be applied with respect to the original
Grantee, following which the Option shall be exercisable by the transferee only
to the extent, and for the periods specified, in Section 8.4.

 

8.11     Limitations on Incentive Stock Options.  An Option shall constitute an
Incentive Stock Option only (i) if the Grantee of such Option is an employee of
the Company or any Subsidiary of the Company; (ii) to the extent specifically
provided in the related Award Agreement; and (iii) to the extent that the
aggregate Fair Market Value (determined at the time the Option is granted) of
the shares of Stock with respect to which all Incentive Stock Options held by
such Grantee become exercisable for the first time during any calendar year
(under the Plan and all other plans of the Company and its Affiliates) does not
exceed One Hundred Thousand Dollars ($100,000).  This limitation shall be
applied by taking Options into account in the order in which they were granted.

 

 - 15 -

 

 

8.12     Notice of Disqualifying Disposition.  If any Grantee shall make any
disposition of shares of Stock issued pursuant to the exercise of an Incentive
Stock Option under the circumstances described in Code Section 421(b) (relating
to certain disqualifying dispositions), such Grantee shall notify the Company of
such disposition within ten (10) days thereof.

 

8.13     No Reloads. Award Agreements for Options shall not contain any
provision entitling a Grantee to the automatic grant of additional Options in
connection with the exercise of the original Option.

 

8.14     No Repricing. Except as contemplated by the provisions of Section 17,
outstanding Options will not be repriced without the prior approval of the
Company’s stockholders.

 

Section 9.         TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS

 

9.1       Right to Payment and Grant Price.  A Stock Appreciation Right shall
confer on the Grantee to whom it is granted a right to receive, upon exercise
thereof, the excess of (A) the Fair Market Value of one share of Stock on the
date of exercise over (B) the SAR Exercise Price  as determined by the Board or
the Committee.  The Award Agreement for an SAR shall specify the SAR Exercise
Price, which shall be at least the Fair Market Value of a share of Stock on the 
Grant Date.  SARs may be granted in conjunction with all or part of an Option
granted under the Plan or at any subsequent time during the term of such Option,
in conjunction with all or part of any other Award or without regard to any
Option or other Award; provided that an SAR that is granted subsequent to the
Grant Date of a related Option must have a SAR Exercise Price that is no less
than the Fair Market Value of one share of Stock on the Grant Date of the SAR.

 

9.2       Other Terms.  The Board or the Committee shall determine at the Grant
Date, the time or times at which and the circumstances under which an SAR may be
exercised in whole or in part (including based on achievement of performance
goals and/or future service requirements), the time or times at which SARs shall
cease to be or become exercisable following termination of Service or upon other
conditions, the method of exercise, method of settlement, form of consideration
payable in settlement, method by or forms in which Stock will be delivered or
deemed to be delivered to Grantees, whether or not an SAR shall be in tandem or
in combination with any other Award, and any other terms and conditions of any
SAR.  Notwithstanding the foregoing, except for Substitute Awards and the
Minimum Vesting Requirements exceptions, SARs shall have a vesting period of at
least twelve (12) months from the Grant Date.

 

9.3       Term.  Each SAR granted under the Plan shall terminate, and all rights
thereunder shall cease, upon the expiration of ten years from the date such SAR
is granted, or under such circumstances and on such date prior thereto as is set
forth in the Plan or as may be fixed by the Board or the Committee and stated in
the Award Agreement relating to such SAR; provided, however, that such term
shall be automatically extended by thirty (30) days in the event that the
original term of the SAR is set to expire during a closed window period
applicable to the Grantee.

 

9.4       Transferability of SARS.  Except as provided in Section 9.5, during
the lifetime of a Grantee, only the Grantee (or, in the event of legal
incapacity or incompetency, the Grantee’s guardian or legal representative) may
exercise a SAR.  Except as provided in Section 9.5, no SAR shall be assignable
or transferable by the Grantee to whom it is granted, other than by will or the
laws of descent and distribution.

 

 -16- 

 

 

9.5       Family Transfers.  If authorized in the applicable Award Agreement, a
Grantee may transfer, not for value, all or part of a SAR to any Family Member. 
For the purpose of this Section 9.5, a “not for value” transfer is a transfer
which is (i) a gift, (ii) a transfer under a domestic relations order in
settlement of marital property rights; or (iii) a transfer to an entity in which
more than fifty percent of the voting interests are owned by Family Members (or
the Grantee) in exchange for an interest in that entity.  Following a transfer
under this Section 9.5, any such SAR shall continue to be subject to the same
terms and conditions as were applicable immediately prior to transfer. 
Subsequent transfers of transferred SARs are prohibited except to Family Members
of the original Grantee in accordance with this Section 9.5 or by will or the
laws of descent and distribution.

 

9.6       No Repricing. Except as contemplated by the provisions of Section 17,
outstanding Stock Appreciation Rights will not be repriced without the prior
approval of the Company’s stockholders.

 

Section 10.       TERMS AND CONDITIONS OF RESTRICTED STOCK AND STOCK UNITS

 

10.1     Grant of Restricted Stock or Stock Units.  Each Award of Restricted
Stock or Stock Units shall be evidenced by an Award Agreement and may be made
for no consideration (other than par value of the shares of Stock which is
deemed paid by Services already rendered).  Settlement of each Award of Stock
Units shall be in cash, Stock, other property or a combination thereof, in the
discretion of the Committee. 

 

10.2     Restrictions; Minimum Vesting.  At the time a grant of Restricted Stock
or Stock Units is made, the Board or the Committee may, in its sole discretion,
establish a period of time (a “Restricted Period”) applicable to such Restricted
Stock or Stock Units.  Each Award of Restricted Stock or Stock Units may be
subject to a different Restricted Period.  The Board or the Committee may, in
its sole discretion, at the time a grant of Restricted Stock or Stock Units is
made, prescribe restrictions in addition to or other than the expiration of the
Restricted Period.  Notwithstanding the foregoing, except for Substitute Awards
and the Minimum Vesting Requirements exceptions, Awards of Restricted Stock or
Stock Units subject solely to continued Service with the Company or an Affiliate
shall have a vesting period of at least twelve (12) months from the Grant Date. 
Neither Restricted Stock nor Stock Units may be sold, transferred, assigned,
pledged or otherwise encumbered or disposed of during the Restricted Period or
prior to the satisfaction of any other restrictions prescribed by the Board or
the Committee with respect to such Restricted Stock or Stock Units.

 

10.3     Restricted Stock Certificates.  The Company shall issue, in the name of
each Grantee to whom Restricted Stock has been granted, stock certificates or
book-entry registered shares pursuant to Section 3.6 representing the total
number of shares of Restricted Stock granted to the Grantee, as soon as
reasonably practicable after the Grant Date.  The Secretary of the Company shall
hold such certificates for the Grantee’s benefit until such time as the
Restricted Stock is forfeited to the Company or the restrictions lapse, or such
certificates or book-entry registered shares shall be delivered to the
Grantee, provided, however, that such certificates or book-entry registered
shares shall bear a legend or legends that comply with the applicable securities
laws and regulations and makes appropriate reference to the restrictions imposed
under the Plan and the Award Agreement.

 

 - 17 -

 

 

10.4     Rights of Holders of Restricted Stock.  Unless the Board or the
Committee otherwise provides in an Award Agreement, holders of Restricted Stock
shall have the right to vote such Stock and the right to receive any dividends
declared or paid with respect to such Stock.  The Board or the Committee may
provide that any dividends paid on Restricted Stock must be reinvested in shares
of Stock, which may or may not be subject to the same vesting conditions and
restrictions applicable to such Restricted Stock.  All distributions, if any,
received by a Grantee with respect to Restricted Stock as a result of any stock
split, stock dividend, combination of shares, or other similar transaction shall
be subject to the restrictions applicable to the original Award.

 

10.5     Rights of Holders of Stock Units.

 

(i)         Voting and Dividend Rights.  Holders of Stock Units shall have no
rights as stockholders of the Company.  The Board or the Committee may provide
in an Award Agreement evidencing a grant of Stock Units that the holder of such
Stock Units shall be entitled to receive, upon the Company’s payment of a cash
dividend on its outstanding Stock, a cash payment for each Stock Unit held equal
to the per-share dividend paid on the Stock.  Such Award Agreement may also
provide that such cash payment will be deemed reinvested in additional Stock
Units at a price per unit equal to the Fair Market Value of a share of Stock on
the date that such dividend is paid.

 

(ii)        Creditor’s Rights.  A holder of Stock Units shall have no rights
other than those of a general creditor of the Company.  Stock Units represent an
unfunded and unsecured obligation of the Company, subject to the terms and
conditions of the applicable Award Agreement.

 

10.6     Purchase of Restricted Stock.  The Grantee shall be required, to the
extent required by applicable law, to purchase the Restricted Stock from the
Company at a Purchase Price equal to the greater of (i) the aggregate par value
of the shares of Stock represented by such Restricted Stock, or (ii) the
Purchase Price, if any, specified in the Award Agreement relating to such
Restricted Stock.  The Purchase Price shall be payable in a form described in
Section 12 or, in the discretion of the Board or the Committee, in consideration
for past Services rendered to the Company or an Affiliate.

 

10.7     Delivery of Stock.  Upon the expiration or termination of any
Restricted Period and the satisfaction of any other conditions prescribed by the
Board or the Committee, the restrictions applicable to shares of Restricted
Stock or Stock Units shall lapse, and, unless otherwise provided in the Award
Agreement, a stock certificate or book-entry registration for such shares shall
be delivered, free of all such restrictions, to the Grantee or the Grantee’s
beneficiary or estate, as the case may be.  Neither the Grantee, nor the
Grantee’s beneficiary or estate, shall have any further rights with regard to a
Stock Unit once the share of Stock represented by the Stock Unit (or cash or
other property, as applicable) has been delivered.

 

 - 18 -

 

  

Section 11.       TERMS AND CONDITIONS OF UNRESTRICTED STOCK AWARDS

 

The Board or the Committee may, in its sole discretion, grant (or sell at par
value or such other higher Purchase Price determined by the Board or the
Committee) an Award of Unrestricted Stock to any Grantee pursuant to which such
Grantee may receive shares of Stock free of any restrictions (“Unrestricted
Stock”) under the Plan.  Awards of Unrestricted Stock may be granted or sold as
described in the preceding sentence in respect of past Services and other valid
consideration, or in lieu of, or in addition to, any cash compensation due to
such Grantee.

 

Section 12.       FORM OF PAYMENT FOR OPTIONS AND RESTRICTED STOCK

 

12.1     General Rule.  Payment of the Option Price for the shares purchased
pursuant to the exercise of an Option or the Purchase Price for Restricted Stock
shall be made in cash or in cash equivalents acceptable to the Company.

 

12.2     Surrender of Stock.  To the extent the Award Agreement so provides,
payment of the Option Price for shares of Stock purchased pursuant to the
exercise of an Option or the Purchase Price for Restricted Stock may be made all
or in part through the tender to the Company of shares of Stock, which shall be
valued, for purposes of determining the extent to which the Option Price or
Purchase Price has been paid thereby, at their Fair Market Value on the date of
exercise or surrender.

 

12.3     Cashless Exercise; Net Exercise.  With respect to an Option only (and
not with respect to Restricted Stock), to the extent permitted by law and to the
extent the Award Agreement so provides, payment of the Option Price for shares
purchased pursuant to the exercise of an Option may be made all or in part by
(i) delivery (on a form acceptable to the Board or the Committee) of an
irrevocable direction to a licensed securities broker acceptable to the Company
to sell shares of Stock and to deliver all or part of the sales proceeds to the
Company in payment of the Option Price and any withholding taxes described in
Section 18.3, or (ii) a Net Exercise.

 

12.4     Other Forms of Payment.  To the extent the Award Agreement so provides,
payment of the Option Price for shares purchased pursuant to exercise of an
Option or the Purchase Price for Restricted Stock may be made in any other form
that is consistent with applicable laws, regulations and rules.

 

Section 13.       TERMS AND CONDITIONS OF DIVIDEND EQUIVALENT RIGHTS

 

13.1     Dividend Equivalent Rights.  A Dividend Equivalent Right is an Award
entitling the recipient to receive credits based on cash distributions that
would have been paid on the shares of Stock specified in the Dividend Equivalent
Right (or other Award to which it relates) if such shares of Stock had been
issued to and held by the recipient.  A Dividend Equivalent Right may be granted
hereunder to any Grantee, provided that no Dividend Equivalent Rights may be
granted in connection with, or related to, an Award of Options or SARs.  The
terms and conditions of Dividend Equivalent Rights shall be specified in the
Award Agreement.  Dividend Equivalents credited to the holder of a Dividend
Equivalent Right may be paid currently or at the end of any applicable vesting
period, or may be deemed to be reinvested in additional shares of Stock, which
may thereafter accrue additional equivalents.  Any such reinvestment shall be at
Fair Market Value on the date of reinvestment.  Dividend Equivalent Rights may
be settled in cash or Stock or a combination thereof, in a single installment or
installments, all determined in the sole discretion of the Board or the
Committee.  A Dividend Equivalent Right granted as a component of another Award
may provide that such Dividend Equivalent Right shall be settled upon exercise,
settlement, or payment of, or lapse of restrictions on, such other Award, and
that such Dividend Equivalent Right shall expire or be forfeited or annulled
under the same conditions as such other Award.  A Dividend Equivalent Right
granted as a component of another Award also may contain terms and conditions
which are different from the terms and conditions of such other Award, provided
that Dividend Equivalent Rights credited pursuant to a Dividend Equivalent Right
granted as a component of another Award which vests or is earned based upon the
achievement of performance goals shall not vest or become payable unless such
performance goals for such underlying Award are achieved, and if such
performance goals are not achieved, the Grantee of such Dividend Equivalent
Rights shall promptly forfeit and repay to the Company payments made in
connection with such Dividend Equivalent Rights. Awards of Dividend Equivalent
rights shall be subject to the Minimum Vesting Requirements.

 

 - 19 -

 

 

Section 14.       TERMS AND CONDITIONS OF PERFORMANCE SHARES AND PERFORMANCE
UNITS AWARDS

 

14.1     Grant of Performance Units/Performance Shares.  Subject to the terms
and provisions of this Plan, the Board or Committee, at any time and from time
to time, may grant Awards of Performance Units and/or Performance Shares to
Grantees in such amounts and upon such terms as the Board or Committee shall
determine.

 

14.2     Award Agreement.  Each Award of Performance Shares or Performance Units
shall be evidenced by an Award Agreement that shall specify the number of
Performance Shares or Performance Units subject to the Award, the performance
objectives (which may include Performance Measures), the Performance Period
applicable to the Award, any other conditions or restrictions on the Award, and
such other terms and conditions as the Board or Committee, in its discretion,
determines and as are consistent with this Plan.  Each Performance Share shall
have an initial value equal to the Fair Market Value of a Share on the Grant
Date.

 

14.3     Performance Objectives.  Any grant of Performance Shares or Performance
Units shall specify performance objectives (which may include Performance
Measures), which, if achieved, will result in payment or early payment of the
Award.  Each grant shall specify a minimum acceptable level of achievement of
the performance objectives and shall set forth a formula for determining the
number of Performance Shares or Performance Units that will be earned if
performance is at or above minimum level, but falls short of full achievement of
the specified performance objectives.  Before the Performance Shares or
Performance Units shall be earned and paid, the Committee must determine the
level of achievement of the performance objectives.

 

14.4     Timing For Establishing Performance Goals.  For Performance Awards
other than Options that are intended to qualify as “performance-based
compensation” for purposes of Code Section 409A, performance goals shall be
established not later than ninety (90) days after the beginning of any
performance period applicable to such Awards, or at such other date as may be
required or permitted for “performance-based compensation” under Code
Section 409A and the regulations issued thereunder.

 

 - 20 -

 

 

14.5     Settlement of Performance Awards; Other Terms.  Settlement of
Performance Awards shall be in cash, Stock,  other property or a combination
thereof, in the discretion of the Committee.  The Committee may, in its
discretion, reduce the amount of a settlement otherwise to be made in connection
with such Performance Awards.  The Committee shall specify the circumstances in
which such Performance Awards shall be paid or forfeited in the event of
termination of Service by the Grantee prior to the end of a performance period
or settlement of Performance Awards.

 

14.6     Performance Measures.  Any Performance Measure(s) may be used to
measure the performance of the Company, any Subsidiary, and/or any Affiliate as
a whole or any business unit of the Company, any Subsidiary, and/or any
Affiliate or any combination thereof, as the Committee may deem appropriate, or
any of the Performance Measures as compared to the performance of a group of
comparator companies, or published or special index that the Committee, in its
sole discretion, deems appropriate, or the Company may select share price,
including growth measures and total stockholder return as compared to various
stock market indices.  The Committee also has the authority to provide for
accelerated vesting of any Performance Award based on the achievement of
performance goals pursuant to the Performance Measures.

 

(i)         Evaluation of Performance.  The Committee may provide in any Award
Agreement that any evaluation of performance may include or exclude any of the
following events that occur during a Performance Period: (a) asset write-downs;
(b) litigation or claim judgments or settlements; (c) the effect of changes in
tax laws, accounting principles, or other laws or provisions affecting reported
results; (d) any reorganization and restructuring programs; (e) events or
circumstances that are unusual in nature or infrequently occurring;
(f) acquisitions or divestitures; and (g) foreign exchange gains and losses.

 

(ii)        Adjustment of Performance-Based Compensation.  Awards that are
intended to qualify as Performance-Based Compensation may be adjusted upward or
downward, either on a formula or discretionary basis, or any combination as the
Committee determines.

 

14.7     Dividends and Dividend Equivalents.  The Committee may, at the Grant
Date of Performance Shares or Performance Units, provide for payment of
dividends or dividend equivalents to the Grantee either in cash or in additional
Shares, subject in all cases to deferral and payment on a contingent basis based
on Grantee’s earning of the Performance Shares or Performance Units with respect
to which such dividend equivalents or dividends are paid.

 

14.8     Minimum Vesting Requirements.  Except for Substitute Awards and the
Minimum Vesting Requirements exceptions, Awards of Performance Shares and
Performance Units shall have a vesting period of at least twelve (12) months
from the Grant Date.

 

Section 15.       PARACHUTE LIMITATIONS

 

Notwithstanding any other provision of this Plan or of any Award Agreement or
other agreement, contract, or understanding heretofore or hereafter entered into
by a Grantee with the Company or any Affiliate, except an agreement, contract,
or understanding that expressly addresses Section 280G or Section 4999 of the
Code (an “Other Agreement”), and notwithstanding any formal or informal plan or
other arrangement for the direct or indirect provision of compensation to the
Grantee (including groups or classes of Grantees or beneficiaries of which the
Grantee is a member), whether or not such compensation is deferred, is in cash,
or is in the form of a benefit to or for the Grantee (a “Benefit Arrangement”),
if the Grantee is a “disqualified individual,” as defined in Section 280G(c) of
the Code, any Option, Restricted Stock, Stock Unit, Performance Share or
Performance Unit held by that Grantee and any right to receive any payment or
other benefit under this Plan shall not become exercisable or vested (i) to the
extent that such right to exercise, vesting, payment, or benefit, taking into
account all other rights, payments, or benefits to or for the Grantee under this
Plan, all Other Agreements, and all Benefit Arrangements, would cause any
payment or benefit to the Grantee under this Plan to be considered a “parachute
payment” within the meaning of Section 280G(b)(2) of the Code as then in effect
(a “Parachute Payment”), and (ii) if, as a result of receiving a Parachute
Payment, the aggregate after-tax amounts received by the Grantee from the
Company under this Plan, all Other Agreements, and all Benefit Arrangements
would be less than the maximum after-tax amount that could be received by the
Grantee without causing any such payment or benefit to be considered a Parachute
Payment.  In the event that the receipt of any such right to exercise, vesting,
payment, or benefit under this Plan, in conjunction with all other rights,
payments, or benefits to or for the Grantee under any Other Agreement or any
Benefit Arrangement would cause the Grantee to be considered to have received a
Parachute Payment under this Plan that would have the effect of decreasing the
after-tax amount received by the Grantee as described in clause (ii) of the
preceding sentence, then the Grantee shall have the right, in the Grantee’s sole
discretion, to designate those rights, payments, or benefits under this Plan,
any Other Agreements, and any Benefit Arrangements that should be reduced or
eliminated so as to avoid having the payment or benefit to the Grantee under
this Plan be deemed to be a Parachute Payment.

 

 - 21 -

 

 

Section 16.       REQUIREMENTS OF LAW

 

16.1     General.  The Company shall not be required to sell or issue any shares
of Stock under any Award if the sale or issuance of such shares of Stock would
constitute a violation by the Grantee, any other individual exercising an
Option, or the Company of any provision of any law or regulation of any
governmental authority, including without limitation any federal or state
securities laws or regulations.  If at any time the Company shall determine, in
its discretion, that the listing, registration or qualification of any shares of
Stock subject to an Award upon any securities exchange or under any governmental
regulatory body is necessary or desirable as a condition of, or in connection
with, the issuance or purchase of shares of Stock hereunder, no shares of Stock
may be issued or sold to the Grantee or any other individual exercising an
Option pursuant to such Award unless such listing, registration, qualification,
consent or approval shall have been effected or obtained free of any conditions
not acceptable to the Company, and any delay caused thereby shall in no way
affect the date of termination of the Award.  Without limiting the generality of
the foregoing, in connection with the Securities Act, upon the exercise of any
Option or any SAR that may be settled in shares of Stock or the delivery of any
shares of Stock underlying an Award, unless a registration statement under such
Securities Act is in effect with respect to the shares of Stock covered by such
Award, the Company shall not be required to sell or issue such shares unless the
Board has received evidence satisfactory to it that the Grantee or any other
individual exercising an Option may acquire such shares pursuant to an exemption
from registration under the Securities Act.  Any determination in this
connection by the Board shall be final, binding, and conclusive.  The Company
may, but shall in no event be obligated to, register any securities covered
hereby pursuant to the Securities Act.  The Company shall not be obligated to
take any affirmative action in order to cause the exercise of an Option or a SAR
or the issuance of shares of Stock pursuant to the Plan to comply with any law
or regulation of any governmental authority.  As to any jurisdiction that
expressly imposes the requirement that an Option (or SAR that may be settled in
shares of Stock) shall not be exercisable until the shares of Stock covered by
such Option (or SAR) are registered or are exempt from registration, the
exercise of such Option (or SAR) under circumstances in which the laws of such
jurisdiction apply shall be deemed conditioned upon the effectiveness of such
registration or the availability of such an exemption.

 

 - 22 -

 

 

16.2     Rule 16b-3.  During any time when the Company has a class of equity
security registered under Section 12 of the Exchange Act, it is the intent of
the Company that Awards pursuant to the Plan and the exercise of Options and
SARs granted hereunder will qualify for the exemption provided by Rule 16b-3
under the Exchange Act.  To the extent that any provision of the Plan or action
by the Board does not comply with the requirements of Rule 16b-3, it shall be
deemed inoperative to the extent permitted by law and deemed advisable by the
Board, and shall not affect the validity of the Plan.  In the event that
Rule 16b-3 is revised or replaced, the Board may exercise its discretion to
modify this Plan in any respect necessary to satisfy the requirements of, or to
take advantage of any features of, the revised exemption or its replacement.

 

Section 17.       ADJUSTMENTS FOR CHANGES IN CAPITALIZATION

 

17.1     Mandatory Adjustments.  In the event of an “equity restructuring” (as
such term is defined in Financial Accounting Standards Board Accounting
Standards Codification Topic 718, “Compensation — Stock Compensation”),
including any stock dividend, stock split, spin-off, rights offering, or large
nonrecurring cash dividend, the authorization limits under Sections 4.1, 4.2,
and 6.4 shall be adjusted proportionately, and the Committee shall make such
adjustments to the Plan and outstanding Awards as it deems necessary or
appropriate, in its sole discretion, to prevent dilution or enlargement of
benefits or potential benefits intended to be made available under the Plan,
including: (a) adjustment of the number and kind of shares or securities that
may be issued under the Plan; (b) adjustment of the number and kind of shares or
securities subject to outstanding Awards; (c) adjustment of the Exercise Price
of outstanding Stock Options and Stock Appreciation Rights or the measure to be
used to determine the amount of the benefit payable on an Award; (d) adjustment
to market price-based performance goals or performance goals set on a per-Share
basis; and (e) any other adjustments that the Committee determines to be
equitable.  Notwithstanding the foregoing, the Committee shall not make any
adjustments to outstanding Stock Options or SARs to the extent that it causes
such Stock Options or SARs to provide for a deferral of compensation subject to
Code Section 409A.  Without limiting the foregoing, in the event of a
subdivision of the outstanding Common Stock (a stock split), a dividend payable
in Shares, or a combination or consolidation of the outstanding Common Stock
into a lesser number of Shares, the authorization limits under Sections 4.1, 4.2
and 6.4 shall automatically be adjusted proportionately, and the Shares then
subject to each outstanding Award shall automatically, without the necessity for
any additional action by the Committee, be adjusted proportionately without any
change in the aggregate Exercise Price therefor.

 

 - 23 -

 

 

17.2     Discretionary Adjustments.  Upon the occurrence or in anticipation of
any share combination, exchange or reclassification, recapitalization, merger,
consolidation or other corporate reorganization affecting the Common Stock, or
any transaction described in Section 17.1, in addition to any of the actions
described in Section 17.1, the Committee may, in its sole discretion, provide:
(a) that Awards will be settled in cash rather than Shares; (b) that Awards will
become immediately vested and exercisable and will expire after a designated
period of time to the extent not then exercised; (c) that Awards will be
equitably converted, adjusted or substituted in connection with such
transaction; (d) that outstanding Awards may be settled by payment in cash or
cash equivalents equal to the excess of the Fair Market Value of the underlying
Shares as of a specified date associated with the transaction, over the Exercise
Price of the Award; (e) that performance targets and Performance Periods for
Performance Awards will be modified; or (f) any combination of the foregoing. 
The Committee’s determination need not be uniform and may be different for
different Participants whether or not such Participants are similarly situated.

 

17.3     No Fractional Shares, etc.  After giving effect to any adjustment
pursuant to the provisions of this Section 17, the number of Shares subject to
any Award denominated in whole Shares shall always be a whole number, unless
otherwise determined by the Committee.  Any discretionary adjustments made
pursuant to the provisions of this Section 17 shall be subject to the provisions
of Section 5.  To the extent any adjustments made pursuant to this Section 17
cause Incentive Stock Options to cease to qualify as Incentive Stock Options,
such Stock Options shall be deemed to be Non-Qualified Stock Options.

 

17.4     No Limitations on Company.  The making of Awards pursuant to the Plan
shall not affect or limit in any way the right or power of the Company to make
adjustments, reclassifications, reorganizations, or changes of its capital or
business structure or to merge, consolidate, dissolve, or liquidate, or to sell
or transfer all or any part of its business or assets.

 

Section 18.       GENERAL PROVISIONS

 

18.1     Disclaimer of Rights.  No provision in the Plan or in any Award or
Award Agreement shall be construed to confer upon any individual the right to
remain in the employ or service of the Company or any Affiliate, or to interfere
in any way with any contractual or other right or authority of the Company
either to increase or decrease the compensation or other payments to any
individual at any time, or to terminate any employment or other relationship
between any individual and the Company.  In addition, notwithstanding anything
contained in the Plan to the contrary, unless otherwise stated in the applicable
Award Agreement, no Award granted under the Plan shall be affected by any change
of duties or position of the Grantee, so long as such Grantee continues to be a
director, officer, consultant or employee of the Company or an Affiliate.  The
obligation of the Company to pay any benefits pursuant to this Plan shall be
interpreted as a contractual obligation to pay only those amounts described
herein, in the manner and under the conditions prescribed herein.  The Plan
shall in no way be interpreted to require the Company to transfer any amounts to
a third party trustee or otherwise hold any amounts in trust or escrow for
payment to any Grantee or beneficiary under the terms of the Plan.

 

18.2     Nonexclusivity of the Plan.  Neither the adoption of the Plan nor the
submission of the Plan to the stockholders of the Company for approval shall be
construed as creating any limitations upon the right and authority of the Board
to adopt such other incentive compensation arrangements (which arrangements may
be applicable either generally to a class or classes of individuals or
specifically to a particular individual or particular individuals) as the Board
in its discretion determines desirable, including, without limitation, the
granting of stock options otherwise than under the Plan.

 

 - 24 -

 

 

18.3     Withholding Taxes.  The Company or an Affiliate, as the case may be,
shall have the right to deduct from payments of any kind otherwise due to a
Grantee any federal, state, or local taxes of any kind required by law to be
withheld with respect to the vesting of or other lapse of restrictions
applicable to an Award or upon the issuance of any shares of Stock upon the
exercise of an Option or pursuant to an Award.  At the time of such vesting,
lapse, or exercise, the Grantee shall pay to the Company or the Affiliate, as
the case may be, any amount that the Company or the Affiliate may reasonably
determine to be necessary to satisfy such withholding obligation.  Subject to
the prior approval of the Company or the Affiliate, which may be withheld by the
Company or the Affiliate, as the case may be, in its sole discretion, the
Grantee may elect to satisfy such obligations, in whole or in part, (i) by
causing the Company or the Affiliate to withhold shares of Stock otherwise
issuable to the Grantee or (ii) by delivering to the Company or the Affiliate
shares of Stock already owned by the Grantee.  The shares of Stock so delivered
or withheld shall have an aggregate Fair Market Value equal to such withholding
obligations.  The Fair Market Value of the shares of Stock used to satisfy such
withholding obligation shall be determined by the Company or the Affiliate as of
the date that the amount of tax to be withheld is to be determined.  A Grantee
who has made an election pursuant to this Section 18.3 may satisfy his or her
withholding obligation only with shares of Stock that are not subject to any
repurchase, forfeiture, unfulfilled vesting, or other similar requirements.  The
maximum number of shares of Stock that may be withheld from any Award to satisfy
any federal, state or local tax withholding requirements upon the exercise,
vesting, lapse of restrictions applicable to such Award or payment of shares
pursuant to such Award, as applicable, cannot exceed such number of shares
having a Fair Market Value equal to the maximum amount to be withheld and paid
to any such federal, state or local taxing authority with respect to such
exercise, vesting, lapse of restrictions or payment of shares, or such amount
that will not cause an adverse accounting consequence or cost to the Company.

 

18.4     Captions.  The use of captions in this Plan or any Award Agreement is
for the convenience of reference only and shall not affect the meaning of any
provision of the Plan or such Award Agreement.

 

18.5     Other Provisions.  Each Award granted under the Plan may contain such
other terms and conditions not inconsistent with the Plan as may be determined
by the Board or the Committee, in its sole discretion.

 

18.6     Number and Gender.  With respect to words used in this Plan, the
singular form shall include the plural form, the masculine gender shall include
the feminine gender, etc., as the context requires.

 

18.7     Severability.  If any provision of the Plan or any Award Agreement
shall be determined to be illegal or unenforceable by any court of law in any
jurisdiction, the remaining provisions hereof and thereof shall be severable and
enforceable in accordance with their terms, and all provisions shall remain
enforceable in any other jurisdiction.

  

 - 25 -

 

 

18.8     Governing Law.  The validity and construction of this Plan and the
instruments evidencing the Awards hereunder shall be governed by the laws of the
State of Delaware, other than any conflicts or choice of law rule or principle
that might otherwise refer construction or interpretation of this Plan and the
instruments evidencing the Awards granted hereunder to the substantive laws of
any other jurisdiction.

 

18.9     Section 409A of the Code.  The Board intends to comply with
Section 409A of the Code (“Section 409A”), or an exemption to Section 409A, with
regard to Awards hereunder that constitute nonqualified deferred compensation
within the meaning of Section 409A.  To the extent that the Board or the
Committee determines that a Grantee would be subject to the additional 20% tax
imposed on certain nonqualified deferred compensation plans pursuant to
Section 409A as a result of any provision of any Award granted under this Plan,
such provision shall be deemed amended to the minimum extent necessary to avoid
application of such additional tax.  The nature of any such amendment shall be
determined by the Board.  Notwithstanding the foregoing, the Company, the Board
and the Committee shall have no liability to a Grantee, or any other party, if
an Award that is intended to be exempt from, or compliant with, Section 409A of
the Code is not so exempt or compliant.

 

18.10   Clawback/Recoupment.  Notwithstanding any other provisions herein to the
contrary, any performance based compensation, or any other amount, paid to a
Grantee pursuant to an Award, which is subject to recovery under any law,
government regulation, stock exchange listing requirement, or any policy adopted
by the Company will be subject to such deductions and clawback as may be
required to be made pursuant to such law, government regulation, stock exchange
listing requirement, or policy adopted by the Company.

 

 - 26 -

 

 

APPENDIX A

 

●

net earnings or net income;

●

operating earnings;

●

pretax earnings;

●

pre-tax earnings per share;

●

earnings per share;

●

share price, including growth measures and total stockholder return;

●

earnings before interest and taxes;

●

earnings before interest, taxes, depreciation and/or amortization;

●

earnings before interest, taxes, depreciation and/or amortization as adjusted to
exclude any one or more of the following:

 

o

stock-based compensation expense;

 

o

income from discontinued operations;

 

o

gain on cancellation of debt;

 

o

debt extinguishment and related costs;

 

o

restructuring, separation and/or integration charges and costs;

 

o

reorganization and/or recapitalization charges and costs;

 

o

impairment charges;

 

o

gain or loss related to investments;

 

o

sales and use tax settlement; and

 

o

gain on non-monetary transaction.

●

sales or revenue growth, whether in general, by type of product or service, or
by type of customer;

●

gross or operating margins;

●

return measures, including total shareholder return, return on assets, capital,
investment, equity, sales or revenue;

●

cash flow, including:

 

o

operating cash flow;

 

o

free cash flow, defined as earnings before interest, taxes, depreciation and/or
amortization (as adjusted to exclude any one or more of the items that may be
excluded pursuant to earnings before interest, taxes, depreciation and/or
amortization above) less capital expenditures;

 

o

cash flow return on equity; and

 

o

cash flow return on investment.

●

productivity ratios;

●

expense targets;

●

market share;

●

working capital targets;

●

completion of acquisitions of businesses or companies (including metrics
resulting from the same such as revenue or margin);

●

completion of divestitures and asset sales;

●

debt repayment targets, and debt/equity ratios;

●

bookings or completion of orders (including metrics resulting from the same such
as revenue or margin);

●

project bookings, milestones or completion (including metrics related to the
same such as revenue or margin); and

●

any combination of the foregoing business criteria.

 

 A-1