EXHIBIT 10.1

MERIX CORPORATION

2006 EQUITY INCENTIVE PLAN

SECTION 1. PURPOSE

The purpose of the Merix Corporation 2006 Equity Incentive Plan is to attract,
retain and motivate employees, officers, directors, consultants, agents,
advisors and independent contractors of the Company and its Related Companies by
providing them the opportunity to acquire a proprietary interest in the Company
and to align their interests and efforts to the long-term interests of the
Company’s shareholders.

SECTION 2. DEFINITIONS

Certain capitalized terms used in the Plan have the meanings set forth in
Appendix A.

SECTION 3. ADMINISTRATION

 

3.1 Administration of the Plan

The Plan shall be administered by the Board, and the Board may delegate this
authority to the Human Resources and Compensation Committee or another committee
of the Board. In selecting the members of any such committee to administer the
Plan with respect to Participants subject or likely to become subject to
Section 16 of the Exchange Act, the Board shall consider the provisions of
Section 16 of the Exchange Act and Section 162(m) of the Code, and whether each
such member is a “non-employee director” within the meaning of Rule 16b-3(b)(3)
promulgated under the Exchange Act, or any successor definition adopted by the
Securities and Exchange Commission, and an “outside director” within the meaning
of Section 162(m) of the Code, or any successor provision thereto.
Notwithstanding the foregoing, the Board may delegate responsibility for
administering the Plan with respect to designated classes of Eligible Persons to
different committees consisting of one or more members of the Board, subject to
such limitations as the Board deems appropriate, except with respect to Awards
to Participants who are subject to Section 16 of the Exchange Act or Awards
granted pursuant to Section 16 of the Plan. Members of any committee shall serve
for such term as the Board may determine, subject to removal by the Board at any
time. To the extent consistent with applicable law, the Board or the Human
Resources and Compensation Committee may authorize one or more officers of the
Company to grant Awards to designated classes of Eligible Persons, within limits
specifically prescribed by the Board or the Human Resources and Compensation
Committee; provided, however, that no such officer shall have or obtain
authority to grant Awards to himself or herself or to any person subject to
Section 16 of the Exchange Act and no discretionary Award shall be granted to a
non-employee director of the Company unless such Award is approved (i) by a
committee of the Board comprised solely of ‘independent directors” (within the
meaning of the independence standards of the NASDAQ Stock Market or other
primary exchange for the Company’s common stock), or (ii) with the affirmative
votes of a majority of the independent directors, if approved by the Board . All
references in the Plan to the “Committee” shall be, as applicable, to the Human
Resources and Compensation Committee or any other committee or any officer to
whom the Board or the Human Resources and Compensation Committee has delegated
authority to administer the Plan.

 

3.2 Administration and Interpretation by Committee

(a) Except for the terms and conditions explicitly set forth in the Plan and to
the extent permitted by applicable law, the Committee shall have full power and
exclusive authority, subject to such orders or resolutions not inconsistent with
the provisions of the Plan as may from time to time be adopted by the Board or a
Committee composed of members of the Board, to (i) select the Eligible Persons
to whom Awards may from time to time be granted under the Plan; (ii) determine
the type or types of Award to be granted to each Participant under the Plan;
(iii) determine the number of shares of Common Stock to be covered by each Award
granted under the Plan; (iv) determine the terms and conditions of any Award
granted under the Plan; (v) approve the forms of notice or agreement for use
under the Plan; (vi) determine whether, to what extent and under what
circumstances Awards may be settled in cash, shares of Common Stock or other
property, or canceled or suspended; (vii) determine whether, to what extent and
under what circumstances cash, shares of Common Stock, other property and other
amounts payable with respect to an Award shall be deferred either automatically
or at the election of the Participant; (viii) interpret and administer the Plan
and any instrument evidencing an Award, notice or agreement executed or entered
into under the Plan; (ix) establish such rules and regulations as it shall deem
appropriate for the proper administration of the Plan; (x) delegate ministerial
duties to such of the Company’s employees as it so determines; and (xi) make any
other determination and take any other action that the Committee deems necessary
or desirable for administration of the Plan.

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(b) In no event, however, shall the Committee have the right, without
shareholder approval, to (i) cancel or amend outstanding Options or SARs for the
purpose of repricing, replacing or regranting such Options or SARs with Options
or SARs that have a purchase or grant price that is less than the purchase or
grant price of the original Options or SARs except in connection with
adjustments provided in Section 15, or (ii) issue an Option or amend an
outstanding Option to provide for the grant or issuance of a new Option on
exercise of the original Option.

(c) The effect on the vesting of an Award of a Company-approved leave of absence
or a Participant’s working less than full time shall be determined by the
Company’s chief human resources officer or other person performing that function
or, with respect to directors or executive officers, by the Human Resources and
Compensation Committee, whose determination shall be final.

(d) Decisions of the Committee shall be final, conclusive and binding on all
persons, including the Company, any Participant, any shareholder and any
Eligible Person. A majority of the members of the Committee may determine its
actions.

SECTION 4. SHARES SUBJECT TO THE PLAN

 

4.1 Authorized Number of Shares

Subject to adjustment from time to time as provided in Section 15.1, the number
of shares of Common Stock available for issuance under the Plan shall be:

(a) 750,000 shares; plus

(b) any authorized shares (i) not issued or subject to outstanding awards under
the Company’s 1994 Stock Incentive Plan (the “Prior Plan”) on the Effective Date
and (ii) any shares subject to outstanding awards under the Prior Plan on the
Effective Date that cease to be subject to such awards (other than by reason of
exercise or settlement of the awards to the extent they are exercised for or
settled in shares); up to an aggregate maximum of 1,451,702 shares, subject to
adjustment from time to time as provided in Section 15.1, which shares shall
cease, as of such date, to be available for grant and issuance under the
Prior Plan, but shall be available for issuance under the Plan.

Shares issued under the Plan shall be drawn from authorized and unissued shares.

 

4.2 Share Usage

(a) Shares of Common Stock covered by an Award shall not be counted as used
unless and until they are actually issued and delivered to a Participant. If any
Award lapses, expires, terminates or is canceled prior to the issuance of shares
thereunder, or if shares of Common Stock are issued under the Plan to a
Participant and thereafter are forfeited to or otherwise reacquired by the
Company, the shares subject to such Awards and the forfeited or reacquired
shares shall again be available for issuance under the Plan. Any shares of
Common Stock (i) tendered by a Participant or retained by the Company as full or
partial payment to the Company for the purchase price of an Award or to satisfy
tax withholding obligations in connection with an Award, or (ii) covered by an
Award that is settled in cash, or in a manner such that some or all of the
shares of Common Stock covered by the Award are not issued, shall be available
for Awards under the Plan. The number of shares of Common Stock available for
issuance under the Plan shall not be reduced to reflect any dividends or
dividend equivalents that are reinvested into additional shares of Common Stock
or credited as additional shares of Common Stock subject to, or paid with
respect to, an Award.

(b) The Committee shall also, without limitation, have the authority to grant
Awards as an alternative to, or as the form of payment for grants or rights
earned or due under, other compensation plans or arrangements of the Company.

(c) Notwithstanding anything in the Plan to the contrary, the Committee may
grant Substitute Awards under the Plan. Substitute Awards shall not reduce the
number of shares authorized for issuance under the Plan. In the event that an
Acquired Entity has shares available for awards or grants under one or more
preexisting plans not adopted in contemplation of such acquisition or
combination, then, to the extent determined by the Board or the Human Resources
and Compensation Committee, the shares available for grant pursuant to the terms
of such preexisting plan (as adjusted, to the extent appropriate, using the
exchange ratio or other adjustment or valuation ratio or formula used in such
acquisition or combination to determine the consideration payable to holders of
common stock of the entities that are parties to such acquisition or
combination) may be used for Awards under the Plan and shall not reduce the
number of shares of Common Stock authorized for issuance under the Plan;
provided, however, that Awards using such available shares shall not be made
after the date awards or grants could have been made under the terms of such
preexisting plans, absent the acquisition or combination, and shall only be made
to individuals who were not employees or directors of the Company or a Related
Company prior to such acquisition or combination. In the event that a written
agreement between the Company and an

 

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Acquired Entity pursuant to which a merger, consolidation or statutory share
exchange is completed is approved by the Board, and said agreement sets forth
the terms and conditions of the substitution for or assumption of outstanding
awards of the Acquired Entity, said terms and conditions shall be deemed to be
the action of the Committee without any further action by the Committee, except
as may be required for compliance with Rule 16b-3 under the Exchange Act, and
the persons holding such awards shall be deemed to be Participants.

(d) Notwithstanding the other provisions in this Section 4.2, the maximum number
of shares that may be issued upon the exercise of Incentive Stock Options shall
equal the aggregate share number stated in Section 4.1, subject to adjustment as
provided in Section 15.1.

 

4.3 Limitations

(a) Subject to adjustment as provided in Section 15.1, the aggregate number of
shares that may be issued pursuant to Awards granted under the Plan other than
Awards of Options or Stock Appreciation Rights shall not exceed 50% of the
aggregate maximum number of shares specified in Section 4.1

(b) Subject to adjustment as provided in Section 15.1, the aggregate number of
shares that may be issued pursuant to Awards granted under the Plan other than
Awards of Options or Stock Appreciation Rights that contain no restrictions or
restrictions based solely on continuous employment or services for fewer than
three years or accomplishment of performance goals over less than one year
(except where Termination of Service occurs by reason of death, Retirement or
Disability) shall not exceed 15% of the aggregate number of shares specified in
Section 4.1.

SECTION 5. ELIGIBILITY

An Award may be granted to any employee, officer or director of the Company or a
Related Company whom the Committee from time to time selects. An Award may also
be granted to any consultant, agent, advisor or independent contractor for bona
fide services rendered to the Company or any Related Company that (a) are not in
connection with the offer and sale of the Company’s securities in a
capital-raising transaction and (b) do not directly or indirectly promote or
maintain a market for the Company’s securities.

SECTION 6. AWARDS

 

6.1 Form, Grant and Settlement of Awards

The Committee shall have the authority, in its sole discretion, to determine the
type or types of Awards to be granted under the Plan. Such Awards may be granted
either alone or in addition to or in tandem with any other type of Award. Any
Award settlement may be subject to such conditions, restrictions and
contingencies as the Committee shall determine.

 

6.2 Evidence of Awards

Awards granted under the Plan shall be evidenced by a written notice or
agreement, which may be electronic or in paper, that shall contain such terms,
conditions, limitations and restrictions as the Committee shall deem advisable
and that are not inconsistent with the Plan.

 

6.3 Deferrals

The Committee may permit or require a Participant to defer receipt of the
payment of any Award. If any such deferral election is permitted or required,
the Committee, in its sole discretion, shall establish rules and procedures for
such payment deferrals, which may include the grant of additional Awards or
provisions for the payment or crediting of interest or dividend equivalents,
including converting such credits to deferred stock unit equivalents.

 

6.4 Dividends and Distributions

Participants may, if the Committee so determines, be credited with dividends
paid with respect to shares of Common Stock underlying an Award in a manner
determined by the Committee in its sole discretion. The Committee may apply any
restrictions to the dividends or dividend equivalents that the Committee deems
appropriate. The Committee, in its sole discretion, may determine the form of
payment of dividends or dividend equivalents, including cash, shares of Common
Stock, Restricted Stock or Stock Units.

SECTION 7. OPTIONS

 

7.1 Grant of Options

 

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The Committee may grant Options designated as Incentive Stock Options or
Nonqualified Stock Options.

 

7.2 Option Exercise Price

The exercise price for shares purchased under an Option shall be as determined
by the Committee, but shall not be less than 100% of the Fair Market Value on
the Grant Date, except in the case of Substitute Awards.

 

7.3 Term of Options

Subject to earlier termination in accordance with the terms of the Plan and the
instrument evidencing the Option, the maximum term of a Nonqualified Stock
Option shall be as established for that Option by the Committee or, if not so
established, shall be ten years from the Grant Date.

 

7.4 Exercise of Options

The Committee shall establish and set forth in each instrument that evidences an
Option the time at which, or the installments in which, the Option shall vest
and become exercisable, any of which provisions may be waived or modified by the
Committee at any time. To the extent an Option has vested and become
exercisable, the Option may be exercised in whole, or from time to time in part,
by delivery to, or as directed or approved by, the Company of a properly
executed stock option exercise agreement or notice, in a form and in accordance
with procedures established by the Committee, setting forth the number of shares
with respect to which the Option is being exercised, the restrictions imposed on
the shares purchased under such exercise agreement, if any, and such
representations and agreements as may be required by the Committee, accompanied
by payment in full as described in Sections 7.5 and 13. An Option may be
exercised only for whole shares and may not be exercised for fewer than a
reasonable number of shares at any one time, as determined by the Committee.

 

7.5 Payment of Exercise Price

The exercise price for shares purchased under an Option shall be paid in full to
the Company by delivery of consideration equal to the product of the Option
exercise price and the number of shares purchased. Such consideration must be
paid before the Company will issue the shares being purchased and must be in a
form or a combination of forms acceptable to the Committee for that purchase,
which forms may include:

(a) cash, check or wire transfer;

(b) tendering (either actually or, so long as the Common Stock is registered
under Section 12(b) or 12(g) of the Exchange Act, by attestation) shares of
Common Stock that on the day prior to the exercise date have an aggregate Fair
Market Value equal to the aggregate exercise price of the shares being purchased
under the Option owned by the Participant for at least six months (or any other
period necessary to avoid adverse accounting consequences to the Company);

(c) so long as the Common Stock is registered under Section 12(b) or 12(g) of
the Exchange Act, and to the extent permitted by law, delivery of a properly
executed exercise notice, together with irrevocable instructions to a brokerage
firm designated or approved by the Company to deliver promptly to the Company
the aggregate amount of proceeds to pay the Option exercise price and any
withholding tax obligations that may arise in connection with the exercise, all
in accordance with the regulations of the Federal Reserve Board; or

(d) such other consideration as the Committee may permit.

 

7.6 Effect of Termination of Service

The Committee shall establish and set forth in each instrument that evidences an
Option whether the Option shall continue to be exercisable, and the terms and
conditions of such exercise, after a Termination of Service, any of which
provisions may be waived or modified by the Committee at any time.

SECTION 8. INCENTIVE STOCK OPTION LIMITATIONS

Notwithstanding any other provisions of the Plan, the terms and conditions of
any Incentive Stock Options shall in addition comply in all respects with
Section 422 of the Code, or any successor provision, and any applicable
regulations thereunder.

SECTION 9. STOCK APPRECIATION RIGHTS

 

9.1 Grant of Stock Appreciation Rights

 

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The Committee may grant Stock Appreciation Rights to Participants at any time on
such terms and conditions as the Committee shall determine in its sole
discretion. An SAR may be granted in tandem with an Option or alone
(“freestanding”). The grant price of a tandem SAR shall be equal to the exercise
price of the related Option. The grant price of a freestanding SAR shall be
established in accordance with procedures for Options set forth in Section 7.2.
An SAR may be exercised upon such terms and conditions and for the term as the
Committee determines in its sole discretion; provided, however, that, subject to
earlier termination in accordance with the terms of the Plan and the instrument
evidencing the SAR, the term of a freestanding SAR shall be as established for
that SAR by the Committee or, if not so established, shall be ten years, and in
the case of a tandem SAR, (a) the term shall not exceed the term of the related
Option and (b) the tandem SAR may be exercised for all or part of the shares
subject to the related Option upon the surrender of the right to exercise the
equivalent portion of the related Option, except that the tandem SAR may be
exercised only with respect to the shares for which its related Option is then
exercisable.

 

9.2 Payment of SAR Amount

Upon the exercise of an SAR, a Participant shall be entitled to receive payment
in an amount determined by multiplying (a) the difference between the Fair
Market Value of the Common Stock on the date of exercise over the grant price of
the SAR by (b) the number of shares with respect to which the SAR is exercised.
At the discretion of the Committee as set forth in the instrument evidencing the
Award, the payment upon exercise of an SAR may be in cash, in shares, in some
combination thereof or in any other manner approved by the Committee in its sole
discretion.

SECTION 10. STOCK AWARDS, RESTRICTED STOCK AND STOCK UNITS

 

10.1 Grant of Stock Awards, Restricted Stock and Stock Units

Subject to Section 10.3 hereof, the Committee may grant Stock Awards, Restricted
Stock and Stock Units on such terms and conditions and subject to such
repurchase or forfeiture restrictions, if any, which may be based on continuous
service with the Company or a Related Company or the achievement of any
performance goals, as the Committee shall determine in its sole discretion,
which terms, conditions and restrictions shall be set forth in the instrument
evidencing the Award.

 

10.2 Vesting of Restricted Stock and Stock Units

Subject to Section 10.3 hereof, upon the satisfaction of any terms, conditions
and restrictions prescribed with respect to Restricted Stock or Stock Units, or
upon a Participant’s release from any terms, conditions and restrictions of
Restricted Stock or Stock Units, as determined by the Committee, and subject to
the provisions of Section 13, (a) the shares of Restricted Stock covered by each
Award of Restricted Stock shall become freely transferable by the Participant,
and (b) Stock Units shall be paid in shares of Common Stock or, if set forth in
the instrument evidencing the Awards, in cash or a combination of cash and
shares of Common Stock. Any fractional shares subject to such Awards shall be
paid to the Participant in cash.

 

10.3 Vesting Restrictions

Notwithstanding any other provisions of the Plan to the contrary, any Stock
Award, Restricted Stock, or Stock Unit granted pursuant to this Section 10 shall
be subject to forfeiture restrictions to be determined by the Committee;
provided, however, that such Stock Award, Restricted Stock or Stock Unit shall,
at a minimum, be subject to a forfeiture restriction for the lesser of (i) a
three year period from the Grant Date, over which the forfeiture restriction
lapses periodically based primarily on continuous service to the Company or a
Related Company and (ii) one year from Grant Date for a forfeiture restriction
that lapses based primarily upon the accomplishment of performance goals
determined by the Committee in its discretion. In no event shall the Committee
have the right, without shareholder approval, to cancel, waive or amend the
provisions of this Section 10.3 other than in the event of death, disability,
retirement, or a Company Transaction, sale, merger, consolidation,
reorganization, liquidation, dissolution or change of control of the Company.

SECTION 11. PERFORMANCE AWARDS

 

11.1 Performance Shares

Subject to Section 11.3 hereof, the Committee may grant Awards of Performance
Shares, designate the Participants to whom Performance Shares are to be awarded,
and determine the number of Performance Shares and the terms and conditions of
each such Award. Performance Shares shall consist of a unit valued by reference
to a designated number of shares of Common Stock, the value of which may be paid
to the Participant by delivery of shares of Common Stock or, if set forth in the
instrument evidencing the Award, of such property as the Committee shall
determine, including, without limitation, cash,

 

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shares of Common Stock, other property, or any combination thereof, upon the
attainment of performance goals, as established by the Committee, and other
terms and conditions specified by the Committee. Notwithstanding the foregoing,
the amount to be paid under an Award of Performance Shares may be adjusted on
the basis of such further consideration as the Committee shall determine in its
sole discretion.

 

11.2 Performance Units

Subject to Section 11.3 hereof, the Committee may grant Awards of Performance
Units, designate the Participants to whom Performance Units are to be awarded,
and determine the number of Performance Units and the terms and conditions of
each such Award. Performance Units shall consist of a unit valued by reference
to a designated amount of property other than shares of Common Stock, which
value may be paid to the Participant by delivery of such property as the
Committee shall determine, including, without limitation, cash, shares of Common
Stock, other property, or any combination thereof, upon the attainment of
performance goals, as established by the Committee, and other terms and
conditions specified by the Committee. Notwithstanding the foregoing, the amount
to be paid under an Award of Performance Units may be adjusted on the basis of
such further consideration as the Committee shall determine in its sole
discretion.

 

11.3 Vesting Restrictions

Notwithstanding any other provisions of the Plan to the contrary, any
Performance Shares or Performance Units granted pursuant to this Section 11
shall be subject to forfeiture restrictions to be determined by the Committee;
provided, however, that such Performance Shares or Performance Units shall, at a
minimum, be subject to a forfeiture restriction for the lesser of (i) a three
year period from the Grant Date, over which the forfeiture restriction lapses
periodically based primarily on continuous service to the Company or a Related
Company and (ii) one year from Grant Date for a forfeiture restriction that
lapses based primarily upon the accomplishment of performance goals determined
by the Committee in its discretion. In no event shall the Committee have the
right, without shareholder approval, to cancel, waive or amend the provisions of
this Section 11.3 other than in the event of death, disability, retirement, or a
Company Transaction, sale, merger, consolidation, reorganization, liquidation,
dissolution or change of control of the Company.

SECTION 12. OTHER STOCK OR CASH-BASED AWARDS

Subject to the terms of the Plan and such other terms and conditions as the
Committee deems appropriate, the Committee may grant other incentives payable in
cash or in shares of Common Stock under the Plan. Notwithstanding any other
provisions of the Plan to the contrary, any other incentives payable in shares
of Common Stock granted pursuant to this Section 12 shall be subject to
forfeiture restrictions to be determined by the Committee; provided, however,
that such incentives shall, at a minimum, be subject to a forfeiture restriction
for the lesser of (i) a three year period from the Grant Date, over which the
forfeiture restriction lapses periodically based primarily on continuous service
to the Company or a Related Company and (ii) one year from Grant Date for a
forfeiture restriction that lapses based primarily upon the accomplishment of
performance goals determined by the Committee in its discretion. In no event
shall the Committee have the right, without shareholder approval, to cancel,
waive or amend the forfeiture provisions of this Section 12 other than in the
event of death, disability, retirement, or a Company Transaction, sale, merger,
consolidation, reorganization, liquidation, dissolution or change of control of
the Company.

SECTION 13. WITHHOLDING

The Company may require the Participant to pay to the Company the amount of
(a) any taxes that the Company is required by applicable federal, state, local
or foreign law to withhold with respect to the grant, vesting or exercise of an
Award (“tax withholding obligations”) and (b) any amounts due from the
Participant to the Company or to any Related Company (“other obligations”). The
Company shall not be required to issue any shares of Common Stock or otherwise
settle an Award under the Plan until such tax withholding obligations and other
obligations are satisfied.

The Committee may permit or require a Participant to satisfy all or part of the
Participant’s tax withholding obligations and other obligations by (a) paying
cash to the Company, (b) having the Company withhold an amount from any cash
amounts otherwise due or to become due from the Company to the Participant,
(c) having the Company withhold a number of shares of Common Stock that would
otherwise be issued to the Participant (or become vested, in the case of
Restricted Stock) having a Fair Market Value equal to the tax withholding
obligations and other obligations, or (d) surrendering a number of shares of
Common Stock the Participant already owns having a value equal to the tax
withholding obligations and other obligations. The value of the shares so
withheld may not exceed the employer’s minimum required tax withholding rate,
and the value of the shares so tendered may not exceed such rate to the extent
the Participant has owned the tendered shares for fewer than six months, if such
limitations are necessary to avoid adverse accounting consequences to the
Company.

 

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SECTION 14. ASSIGNABILITY

No Award or interest in an Award may be sold, assigned, pledged (as collateral
for a loan or as security for the performance of an obligation or for any other
purpose) or transferred by a Participant or made subject to attachment or
similar proceedings otherwise than by will or by the applicable laws of descent
and distribution, except to the extent the Participant designates one or more
beneficiaries on a Company-approved form who may exercise the Award or receive
payment under the Award after the Participant’s death. During a Participant’s
lifetime, an Award may be exercised only by the Participant. Notwithstanding the
foregoing and to the extent permitted by Section 422 of the Code, the Committee,
in its sole discretion, may permit a Participant to assign or transfer an Award
subject to such terms and conditions as the Committee shall specify.

SECTION 15. ADJUSTMENTS

 

15.1 Adjustment of Shares

In the event, at any time or from time to time, a stock dividend, stock split,
spin-off, combination or exchange of shares, recapitalization, merger,
consolidation, distribution to shareholders other than a normal cash dividend,
or other change in the Company’s corporate or capital structure results in
(a) the outstanding shares of Common Stock, or any securities exchanged therefor
or received in their place, being exchanged for a different number or kind of
securities of the Company or (b) new, different or additional securities of the
Company or any other company being received by the holders of shares of Common
Stock, then the Committee shall make proportional adjustments in (i) the maximum
number and kind of securities available for issuance under the Plan; (ii) the
maximum number and kind of securities issuable as Incentive Stock Options as set
forth in Section 4.2; and (iii) the number and kind of securities that are
subject to any outstanding Award and the per share price of such securities,
without any change in the aggregate price to be paid therefor. The determination
by the Committee as to the terms of any of the foregoing adjustments shall be
conclusive and binding.

Notwithstanding the foregoing, the issuance by the Company of shares of stock of
any class, or securities convertible into shares of stock of any class, for cash
or property, or for labor or services rendered, either upon direct sale or upon
the exercise of rights or warrants to subscribe therefor, or upon conversion of
shares or obligations of the Company convertible into such shares or other
securities, shall not affect, and no adjustment by reason thereof shall be made
with respect to, outstanding Awards. Also notwithstanding the foregoing, a
dissolution or liquidation of the Company or a Company Transaction shall not be
governed by this Section 15.1 but shall be governed by Sections 15.2 and 15.3,
respectively.

 

15.2 Dissolution or Liquidation

To the extent not previously exercised or settled, and unless otherwise
determined by the Committee in its sole discretion, Awards shall terminate
immediately prior to the dissolution or liquidation of the Company. To the
extent a vesting condition, forfeiture provision or repurchase right applicable
to an Award has not been waived by the Committee, the Award shall be forfeited
immediately prior to the consummation of the dissolution or liquidation.

 

15.3 Company Transaction

Notwithstanding any other provision of the Plan to the contrary, unless the
Committee shall determine otherwise at the time of grant with respect to a
particular Award, in the event of a Company Transaction that is not a Related
Party Transaction:

(i) All outstanding Awards, other than Performance Shares and Performance Units,
shall be converted, assumed or replaced by the Successor Company or shall become
fully and immediately exercisable, and all applicable deferral and restriction
limitations or forfeiture provisions shall lapse, immediately prior to the
Company Transaction and shall terminate effective at the effective time of the
Company Transaction, if and to the extent such Awards are not converted, assumed
or replaced by the Successor Company.

For the purposes of this Section 15.3.1, an Award shall be considered converted,
assumed or replaced by the Successor Company if following the Company
Transaction the option or right confers the right to purchase or receive, for
each share of Common Stock subject to the Award immediately prior to the Company
Transaction, the consideration (whether stock, cash or other securities or
property) received in the Company Transaction by holders of Common Stock for
each share held on the effective date of the transaction (and if holders were
offered a choice of consideration, the type of consideration chosen by the
holders of a majority of the outstanding shares); provided, however, that if
such consideration received in the Company Transaction is not solely common
stock of the Successor Company, the Committee may, with the consent of the
Successor Company, provide for the consideration to be received upon the
exercise of the Option, for each share of Common Stock subject thereto, to be
solely common stock of the Successor Company substantially equal in fair market
value to the per share

 

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consideration received by holders of Common Stock in the Company Transaction.
The determination of such substantial equality of value of consideration shall
be made by the Committee, and its determination shall be conclusive and binding.

(ii) All Performance Shares or Performance Units earned and outstanding as of
the date the Company Transaction is determined to have occurred shall be payable
in full at the target level in accordance with the payout schedule pursuant to
the Award agreement. Any remaining Performance Shares or Performance Units
(including any applicable performance period) for which the payout level has not
been determined shall be prorated at the target payout level up to and including
the date of such Company Transaction and shall be payable in full at the target
level in accordance with the payout schedule pursuant to the Award agreement.
Any existing deferrals or other restrictions not waived by the Committee in its
sole discretion shall remain in effect.

(iii) Notwithstanding the foregoing, the Committee, in its sole discretion, may
instead provide that a Participant’s outstanding Awards shall terminate upon or
immediately prior to such Company Transaction and that such Participant shall
receive, in exchange therefor, a cash payment equal to the amount (if any) by
which (x) the value of the per share consideration received by holders of Common
Stock in the Company Transaction, or, in the event the Company Transaction is
one of the transactions listed under subsection (c) in the definition of Company
Transaction or otherwise does not result in direct receipt of consideration by
holders of Common Stock, the value of the deemed per share consideration
received, in each case as determined by the Committee in its sole discretion,
multiplied by the number of shares of Common Stock subject to such outstanding
Awards (to the extent then vested and exercisable or whether or not then vested
and exercisable, as determined by the Committee in its sole discretion) exceeds
(y) if applicable, the respective aggregate exercise price or grant price for
such Award.

 

15.4 Further Adjustment of Awards

Subject to Sections 15.2 and 15.3, the Committee shall have the discretion,
exercisable at any time before a sale, merger, consolidation, reorganization,
liquidation, dissolution or change in control of the Company, as defined by the
Committee, to take such further action as it determines necessary or advisable
with respect to Awards. Such authorized action may include (but shall not be
limited to) establishing, amending or waiving the type, terms, conditions or
duration of, or restrictions on, Awards so as to provide for earlier, later,
extended or additional time for exercise, lifting restrictions and other
modifications, and the Committee may take such actions with respect to all
Participants, to certain categories of Participants or only to individual
Participants. The Committee may take such action before or after granting Awards
to which the action relates and before or after any public announcement with
respect to such sale, merger, consolidation, reorganization, liquidation,
dissolution or change in control that is the reason for such action.

 

15.5 No Limitations

The grant of Awards shall in no way affect the Company’s right to adjust,
reclassify, reorganize or otherwise change its capital or business structure or
to merge, consolidate, dissolve, liquidate or sell or transfer all or any part
of its business or assets.

 

15.6 Fractional Shares

In the event of any adjustment in the number of shares covered by any Award,
each such Award shall cover only the number of full shares resulting from such
adjustment.

 

15.7 Section 409A of the Code

Notwithstanding anything in this Plan to the contrary, (a) any adjustments made
pursuant to this Section 15 to Awards that are considered “deferred
compensation” within the meaning of Section 409A of the Code shall be made in
compliance with the requirements of Section 409A of the Code; (b) any
adjustments made pursuant to Section 15 to Awards that are not considered
“deferred compensation” subject to Section 409A of the Code shall be made in
such a manner as to ensure that after such adjustment the Awards either
(i) continue not to be subject to Section 409A of the Code or (ii) comply with
the requirements of Section 409A of the Code; and (c) in any event, the
Committee shall not have the authority to make any adjustments pursuant to
Section 15 to the extent the existence of such authority would cause an Award
that is not intended to be subject to Section 409A of the Code at the time of
grant to be subject thereto.

SECTION 16. CODE SECTION 162(m) PROVISIONS

Notwithstanding any other provision of the Plan, if the Committee determines, at
the time Awards are granted to a Participant who is, or is likely to be as of
the end of the tax year in which the Company would claim a tax deduction in

 

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connection with such Award, a Covered Employee, then the Committee may provide
that this Section 16 is applicable to such Award.

 

16.1 Performance Criteria

If an Award is subject to this Section 16, then the lapsing of restrictions
thereon and the distribution of cash, shares of Common Stock or other property
pursuant thereto, as applicable, shall be subject to the achievement of one or
more objective performance goals established by the Committee, which shall be
based on the attainment of specified levels of one of or any combination of the
following “performance criteria” for the Company as a whole or any business unit
of the Company, as reported or calculated by the Company: cash flows (including,
but not limited to, operating cash flow, free cash flow or cash flow return on
capital); working capital; earnings before income taxes, depreciation and
amortization; earnings per share; book value per share; operating income
(including or excluding depreciation, amortization, extraordinary items,
restructuring charges or other expenses); revenues; operating margins; return on
assets; return on equity; debt; debt plus equity; market or economic value
added; stock price appreciation; total shareholder return; cost control;
strategic initiatives; market share; net income; return on invested capital;
improvements in capital structure; customer satisfaction, employee satisfaction,
services performance, cash management or asset management metrics (together, the
“Performance Criteria”). Such performance goals also may be based on the
achievement of specified levels of Company performance (or performance of an
applicable affiliate or business unit of the Company) under one or more of the
Performance Criteria described above relative to the performance of other
corporations. Such performance goals shall be set by the Committee within the
time period prescribed by, and shall otherwise comply with the requirements of,
Section 162(m) of the Code, or any successor provision thereto, and the
regulations thereunder.

 

16.2 Adjustment of Awards

Notwithstanding any provision of the Plan other than Section 15, with respect to
any Award that is subject to this Section 16, the Committee may adjust
downwards, but not upwards, the amount payable pursuant to such Award, and the
Committee may not waive the achievement of the applicable performance goals
except in the case of the death or disability of the Covered Employee.

 

16.3 Limitations

Subject to adjustment from time to time as provided in Section 15.1, no Covered
Employee may be granted Awards other than Performance Units subject to this
Section 16 in any calendar year period with respect to more than 300,000 shares
of Common Stock for such Award, except that the Company may make additional
one-time grants of such Awards for up to 300,000 shares to newly hired
individuals, and the maximum dollar value payable with respect to Performance
Units subject to this Section 16 granted to any Covered Employee in any one
calendar year is $500,000.

The Committee shall have the power to impose such other restrictions on Awards
subject to this Section 16 as it may deem necessary or appropriate to ensure
that such Awards satisfy all requirements for “performance-based compensation”
within the meaning of Section 162(m)(4)(C) of the Code, or any successor
provision thereto.

SECTION 17. AMENDMENT AND TERMINATION

 

17.1 Amendment, Suspension or Termination

The Board or the Human Resources and Compensation Committee may amend, suspend
or terminate the Plan or any portion of the Plan at any time and in such
respects as it shall deem advisable; provided, however, that, to the extent
required by applicable law, regulation or stock exchange rule, shareholder
approval shall be required for any amendment to the Plan; and provided, further,
that any amendment that requires shareholder approval may be made only by the
Board. Subject to Section 17.3, the Committee may amend the terms of any
outstanding Award, prospectively or retroactively.

 

17.2 Term of the Plan

Unless sooner terminated as provided herein, the Plan shall terminate ten years
from the Effective Date. After the Plan is terminated, no future Awards may be
granted, but Awards previously granted shall remain outstanding in accordance
with their applicable terms and conditions and the Plan’s terms and conditions.
Notwithstanding the foregoing, no Incentive Stock Options may be granted more
than ten years after the later of (a) the Effective Date and (b) the approval by
the shareholders of any amendment to the Plan that constitutes the adoption of a
new plan for purposes of Section 422 of the Code.

 

17.3 Consent of Participant

 

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The amendment, suspension or termination of the Plan or a portion thereof or the
amendment of an outstanding Award shall not, without the Participant’s consent,
materially adversely affect any rights under any Award theretofore granted to
the Participant under the Plan. Any change or adjustment to an outstanding
Incentive Stock Option shall not, without the consent of the Participant, be
made in a manner so as to constitute a “modification” that would cause such
Incentive Stock Option to fail to continue to qualify as an Incentive Stock
Option. Notwithstanding the foregoing, any adjustments made pursuant to
Section 15 shall not be subject to these restrictions.

SECTION 18. GENERAL

 

18.1 No Individual Rights

No individual or Participant shall have any claim to be granted any Award under
the Plan, and the Company has no obligation for uniformity of treatment of
Participants under the Plan.

Furthermore, nothing in the Plan or any Award granted under the Plan shall be
deemed to constitute an employment contract or confer or be deemed to confer on
any Participant any right to continue in the employ of, or to continue any other
relationship with, the Company or any Related Company or limit in any way the
right of the Company or any Related Company to terminate a Participant’s
employment or other relationship at any time, with or without cause.

 

18.2 Issuance of Shares

Notwithstanding any other provision of the Plan, the Company shall have no
obligation to issue or deliver any shares of Common Stock under the Plan or make
any other distribution of benefits under the Plan unless, in the opinion of the
Company’s counsel, such issuance, delivery or distribution would comply with all
applicable laws (including, without limitation, the requirements of the
Securities Act or the laws of any state or foreign jurisdiction) and the
applicable requirements of any securities exchange or similar entity.

The Company shall be under no obligation to any Participant to register for
offering or resale or to qualify for exemption under the Securities Act, or to
register or qualify under the laws of any state or foreign jurisdiction, any
shares of Common Stock, security or interest in a security paid or issued under,
or created by, the Plan, or to continue in effect any such registrations or
qualifications if made.

As a condition to the exercise of an Option or any other receipt of Common Stock
pursuant to an Award under the Plan, the Company may require (a) the Participant
to represent and warrant at the time of any such exercise or receipt that such
shares are being purchased or received only for the Participant’s own account
and without any present intention to sell or distribute such shares and (b) such
other action or agreement by the Participant as may from time to time be
necessary to comply with federal, state and foreign securities laws. At the
option of the Company, a stop-transfer order against any such shares may be
placed on the official stock books and records of the Company, and a legend
indicating that such shares may not be pledged, sold or otherwise transferred,
unless an opinion of counsel is provided (concurred in by counsel for the
Company) stating that such transfer is not in violation of any applicable law or
regulation, may be stamped on stock certificates to ensure exemption from
registration. The Committee may also require the Participant to execute and
deliver to the Company a purchase agreement or such other agreement as may be in
use by the Company at such time that describes certain terms and conditions
applicable to the shares.

To the extent the Plan or any instrument evidencing an Award provides for
issuance of stock certificates to reflect the issuance of shares of Common
Stock, the issuance may be effected on a noncertificated basis, to the extent
not prohibited by applicable law or the applicable rules of any stock exchange.

 

18.3 Indemnification

Each person who is or shall have been a member of the Board, or a committee
appointed by the Board, or an officer of the Company to whom authority was
delegated in accordance with Section 3, shall be indemnified and held harmless
by the Company against and from any loss, cost, liability or expense that may be
imposed upon or reasonably incurred by such person in connection with or
resulting from any claim, action, suit or proceeding to which such person may be
a party or in which such person may be involved by reason of any action taken or
failure to act under the Plan and against and from any and all amounts paid by
such person in settlement thereof, with the Company’s approval, or paid by such
person in satisfaction of any judgment in any such claim, action, suit or
proceeding against such person; provided, however, that such person shall give
the Company an opportunity, at its own expense, to handle and defend the same
before such person undertakes to handle and defend it on such person’s own
behalf, unless such loss, cost, liability or expense is a result of such
person’s own willful misconduct or except as expressly provided by statute.

 

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The foregoing right of indemnification shall not be exclusive of any other
rights of indemnification to which such person may be entitled under the
Company’s certificate of incorporation or bylaws, as a matter of law, or
otherwise, or of any power that the Company may have to indemnify or hold
harmless.

 

18.4 No Rights as a Stockholder

Unless otherwise provided by the Committee or in the instrument evidencing the
Award or in a written employment, services or other agreement, no Award, other
than a Stock Award, shall entitle the Participant to any cash dividend, voting
or other right of a shareholder unless and until the date of issuance under the
Plan of the shares that are the subject of such Award.

 

18.5 Compliance With Laws and Regulations

In interpreting and applying the provisions of the Plan, any Option granted as
an Incentive Stock Option pursuant to the Plan shall, to the extent permitted by
law, be construed as an “incentive stock option” within the meaning of
Section 422 of the Code.

 

18.6 Participants in Other Countries or Jurisdictions

Without amending the Plan, the Committee may grant Awards to Eligible Persons
who are foreign nationals on such terms and conditions different from those
specified in this Plan as may, in the judgment of the Committee, be necessary or
desirable to foster and promote achievement of the purposes of the Plan, and
shall have the authority to adopt such modifications, procedures, subplans and
the like as may be necessary or desirable to comply with provisions of the laws
or regulations of other countries or jurisdictions in which the Company or any
Related Company may operate or have employees to ensure the viability of the
benefits from Awards granted to Participants employed in such countries or
jurisdictions, meet the requirements that permit the Plan to operate in a
qualified or tax-efficient manner, comply with applicable foreign laws or
regulations, and meet the objectives of the Plan.

 

18.7 No Trust or Fund

The Plan is intended to constitute an “unfunded” plan. Nothing contained herein
shall require the Company to segregate any monies or other property, or shares
of Common Stock, or to create any trusts, or to make any special deposits for
any immediate or deferred amounts payable to any Participant, and no Participant
shall have any rights that are greater than those of a general unsecured
creditor of the Company.

 

18.8 Successors

All obligations of the Company under the Plan with respect to Awards shall be
binding on any successor to the Company, whether the existence of such successor
is the result of a direct or indirect purchase, merger, consolidation, or
otherwise, of all or substantially all the business and/or assets of the
Company.

 

18.9 Severability

If any provision of the Plan or any Award is determined to be invalid, illegal
or unenforceable in any jurisdiction, or as to any person, or would disqualify
the Plan or any Award under any law deemed applicable by the Committee, such
provision shall be construed or deemed amended to conform to applicable laws,
or, if it cannot be so construed or deemed amended without, in the Committee’s
determination, materially altering the intent of the Plan or the Award, such
provision shall be stricken as to such jurisdiction, person or Award, and the
remainder of the Plan and any such Award shall remain in full force and effect.

 

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18.10  Choice of Law

The Plan, all Awards granted thereunder and all determinations made and actions
taken pursuant hereto, to the extent not otherwise governed by the laws of the
United States, shall be governed by the laws of the State of Oregon without
giving effect to principles of conflicts of law.

 

18.11  Legal Requirements

The granting of Awards and the issuance of shares of Common Stock under the Plan
are subject to all applicable laws, rules and regulations, and to such approvals
by any governmental agencies or national securities exchanges as may be
required.

SECTION 19. EFFECTIVE DATE

The effective date (the “Effective Date”) is the date on which the Plan is
approved by the shareholders of the Company.

 

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APPENDIX A

DEFINITIONS

As used in the Plan,

“Acquired Entity” means any entity acquired by the Company or a Related Company
or with which the Company or a Related Company merges or combines.

“Award” means any Option, Stock Appreciation Right, Stock Award, Restricted
Stock, Stock Unit, Performance Share, Performance Unit, cash-based award or
other incentive payable in cash or in shares of Common Stock as may be
designated by the Committee from time to time.

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

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

“Committee” has the meaning set forth in Section 3.1.

“Common Stock” means the common stock, no par value, of the Company.

“Company” means Merix Corporation, an Oregon corporation.

“Company Transaction,” unless otherwise defined in the instrument evidencing the
Award or in a written employment, services or other agreement between the
Participant and the Company or a Related Company, means consummation of:

(a) a merger or consolidation of the Company with or into any other company or
other entity;

(b) a statutory share exchange pursuant to which the Company’s outstanding
shares are acquired or a sale in one transaction or a series of transactions
undertaken with a common purpose of all of the Company’s outstanding voting
securities;

(c) a sale, lease, exchange or other transfer in one transaction or a series of
related transactions undertaken with a common purpose of all or substantially
all of the Company’s assets.

(d) an acquisition by any Entity of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) of 30% or more of either (1) the
then outstanding shares of common stock of the Company (the “Outstanding Company
Common Stock”) or (2) the combined voting power of the then outstanding voting
securities of the Company entitled to vote generally in the election of
directors (the “Outstanding Company Voting Securities”), excluding, however, the
following: (i) any acquisition directly from the Company, other than an
acquisition by virtue of the exercise of a conversion privilege where the
security being so converted was not acquired directly from the Company by the
party exercising the conversion privilege, (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 Related Company, or (iv) a Related Party
Transaction; or

(e) a change in the composition of the Board during any two-year period such
that the individuals who, as of the beginning of such two-year period,
constitute the Board (the “Incumbent Board”) cease for any reason to constitute
at least a majority of the Board; provided, however, that for purposes of this
definition, any individual who becomes a member of the Board subsequent to the
beginning of the two-year period, whose election, or nomination for election by
the Company’s shareholders, was approved by a vote of at least half of those
individuals who are members of the Board and who were also members of the
Incumbent Board (or deemed to be such pursuant to this proviso) shall be
considered as though such individual were a member of the Incumbent Board; and
provided further, however, that any such individual whose initial assumption of
office occurs as a result of or in connection with an actual or threatened
solicitation of proxies or consents by or on behalf of an Entity other than the
Board shall not be considered a member of the Incumbent Board.

Where a series of transactions undertaken with a common purpose is deemed to be
a Company Transaction, the date of such Company Transaction shall be the date on
which the last of such transactions is consummated.

“Human Resources and Compensation Committee” means the Human Resources and
Compensation Committee of the Board.

 

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“Covered Employee” means a “covered employee” as that term is defined for
purposes of Section 162(m)(3) of the Code or any successor provision.

“Disability,” unless otherwise defined by the Committee or in the instrument
evidencing the Award or in a written employment, services or other agreement
between the Participant and the Company or a Related Company, means a mental or
physical impairment of the Participant that is expected to result in death or
that has lasted or is expected to last for a continuous period of 12 months or
more and that causes the Participant to be unable to perform his or her material
duties for the Company or a Related Company and to be engaged in any substantial
gainful activity, in each case as determined by the Company’s chief human
resources officer or other person performing that function or, in the case of
directors and executive officers, the Human Resources and Compensation
Committee, whose determination shall be conclusive and binding.

“Effective Date” has the meaning set forth in Section 19.

“Eligible Person” means any person eligible to receive an Award as set forth in
Section 5.

“Entity” means any individual, entity or group (within the meaning of
Section 13(d)(3) of the Exchange Act).

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time.

“Fair Market Value” means the average of the high and low trading prices for the
Common Stock on any given date during regular trading or, if not trading on that
date, such price on the last preceding date on which the Common Stock was
traded, unless determined otherwise by the Committee using such methods or
procedures as it may establish.

“Grant Date” means the later of (a) the date on which the Committee completes
the corporate action authorizing the grant of an Award or such later date
specified by the Committee or (b) the date on which all conditions precedent to
an Award have been satisfied, provided that conditions to the exercisability or
vesting of Awards shall not defer the Grant Date.

“Incentive Stock Option” means an Option granted with the intention that it
qualify as an “incentive stock option” as that term is defined for purposes of
Section 422 of the Code or any successor provision.

“Nonqualified Stock Option” means an Option other than an Incentive Stock
Option.

“Option” means a right to purchase Common Stock granted under Section 7.

“Parent Company” means a company or other entity which as a result of a Company
Transaction owns the Company or all or substantially all of the Company’s assets
either directly or through one or more subsidiaries.

“Participant” means any Eligible Person to whom an Award is granted.

“Performance Award” means an Award of Performance Shares or Performance Units
granted under Section 11.

“Performance Criteria” has the meaning set forth in Section 16.1.

“Performance Share” means an Award of units denominated in shares of Common
Stock granted under Section 11.1.

“Performance Unit” means an Award of units denominated in cash or property other
than shares of Common Stock granted under Section 11.2.

“Plan” means the Merix Corporation 2006 Equity Incentive Plan.

“Related Company” means any entity that is directly or indirectly controlled by,
in control of or under common control with the Company.

“Related Party Transaction” means a Company Transaction pursuant to which:

(a) the Entities who are the beneficial owners of the Outstanding Company Common
Stock and Outstanding Company Voting Securities immediately prior to such
Company Transaction will beneficially own, directly or indirectly, at least 50%
of the 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 of the Successor Company in substantially the same proportions as
their ownership, immediately prior to such Company Transaction, of the
Outstanding Company Common Stock and Outstanding Company Voting Securities;

 

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(b) no Entity (other than the Company, any employee benefit plan (or related
trust) of the Company or a Related Company, the Successor Company or, if
reference was made to equity ownership of any Parent Company for purposes of
determining whether clause (a) above is satisfied in connection with the
applicable Company Transaction, such Parent Company) will beneficially own,
directly or indirectly, 30% or more of, respectively, the outstanding shares of
common stock of the Successor Company or the combined voting power of the
outstanding voting securities of the Successor Company entitled to vote
generally in the election of directors unless such ownership resulted solely
from ownership of securities of the Company prior to the Company Transaction;
and

(c) individuals who were members of the Incumbent Board will immediately after
the consummation of the Company Transaction constitute at least a majority of
the members of the board of directors of the Successor Company (or, if reference
was made to equity ownership of any Parent Company for purposes of determining
whether clause (a) above is satisfied in connection with the applicable Company
Transaction, of the Parent Company).

“Restricted Stock” means an Award of shares of Common Stock granted under
Section 10 (and subject to the provisions of Section 10.3), the rights of
ownership of which are subject to restrictions prescribed by the Committee.

“Retirement,” unless otherwise defined in the instrument evidencing the Award or
in a written employment, services or other agreement between the Participant and
the Company or a Related Company, means “Retirement” as defined for purposes of
the Plan by the Committee or the Company’s chief human resources officer or
other person performing that function or, if not so defined, means Termination
of Service on or after the date the Participant reaches “normal retirement age,”
as that term is defined in Section 411(a)(8) of the Code.

“Securities Act” means the Securities Act of 1933, as amended from time to time.

“Stock Appreciation Right” or “SAR” means a right granted under Section 9.1 to
receive the excess of the Fair Market Value of a specified number of shares of
Common Stock over the grant price.

“Stock Award” means an Award of shares of Common Stock granted under Section 10
(and subject to the provisions of Section 10.3), the rights of ownership of
which are not subject to restrictions prescribed by the Committee.

“Stock Unit” means an Award denominated in units of Common Stock granted under
Section 10 (and subject to the provisions of Section 10.3).

“Substitute Awards” means Awards granted or shares of Common Stock issued by the
Company in substitution or exchange for awards previously granted by an Acquired
Entity.

“Successor Company” means the surviving company, the successor company or Parent
Company, as applicable, in connection with a Company Transaction.

“Termination of Service” means a termination of employment or service
relationship with the Company or a Related Company for any reason, whether
voluntary or involuntary, including by reason of death, Disability or
Retirement. Any question as to whether and when there has been a Termination of
Service for the purposes of an Award and the cause of such Termination of
Service shall be determined by the Company’s chief human resources officer or
other person performing that function or, with respect to directors and
executive officers, by the Human Resources and Compensation Committee, whose
determination shall be conclusive and binding. Transfer of a Participant’s
employment or service relationship between the Company and any Related Company
shall not be considered a Termination of Service for purposes of an Award.
Unless the Human Resources and Compensation Committee determines otherwise, a
Termination of Service shall be deemed to occur if the Participant’s employment
or service relationship is with an entity that has ceased to be a Related
Company.

“Vesting Commencement Date” means the Grant Date or such other date selected by
the Committee as the date from which an Award begins to vest.

 

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PLAN ADOPTION AND AMENDMENTS/ADJUSTMENTS

SUMMARY PAGE

 

Date of Board

Action

   Action   

Section/Effect
of Amendment

   Date of Shareholder
Approval August 9, 2006    Initial Plan Adoption       October 5, 2006

 

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