ORIENT-EXPRESS HOTELS LTD.
 
 

2009 SHARE AWARD AND INCENTIVE PLAN

 
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ORIENT-EXPRESS HOTELS LTD.

2009 SHARE AWARD AND INCENTIVE PLAN *
 

Page

1.
Purpose
3
           
2.
Definitions
3
           
3.
Administration
5
           
4.
Shares Subject to Plan
5
           
5.
Eligibility; Per-Person Award Limitations
6
           
6.
Specific Terms of Awards
6
           
7.
Performance Awards
10
           
8.
Certain Provisions Applicable to Awards
10
           
9.
Additional Award Forfeiture Provisions
11
           
10.
Change in Control
11
           
11.
General Provisions
12

Appendix A  Participants Subject to U.S. Law

________________________

* As adopted by the Board of Directors on March 13, 2009 and August 6, 2009 and
approved by shareholders on June 5, 2009, amended by the Board of Directors on
March 12, 2010 and May 26, 2010 and approved by shareholders on June 3, 2010,
amended by the Board of Directors on March 9, 2012 and approved by shareholders
on June 7, 2012.
 
 
 
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ORIENT-EXPRESS HOTELS LTD.

2009 SHARE AWARD AND INCENTIVE PLAN
 

 
1.           Purpose.  The purpose of this 2009 Share Award and Incentive Plan
(the "Plan") is to aid Orient-Express Hotels Ltd., a Bermuda company (together
with its successors and assigns, the "Company"), in attracting, retaining,
motivating and rewarding employees, non-employee directors serving on the Board
of Directors of the Company or any of its subsidiaries or affiliates, and other
service providers of the Company or its subsidiaries or affiliates,
strengthening the Company's capability to develop, maintain and direct a
competent management team, to provide for equitable and competitive compensation
opportunities, to recognize individual contributions and reward achievement of
Company goals, and to promote the creation of long-term value for shareholders
by closely aligning the interests of Participants with those of
shareholders.  The Plan authorizes share-based and cash-based incentives for
Participants.
 
2.           Definitions.  In addition to the terms defined in Section 1 above
and elsewhere in the Plan, the following capitalized terms used in the Plan have
the respective meanings set forth in this Section:
 
(a)           "Annual Incentive Award" means a type of Performance Award granted
to a Participant under Section 7 representing a conditional right to receive
cash, Shares or other Awards or payments, as determined by the Committee, based
on performance in a performance period of one fiscal year or a portion thereof.
 
(b)           "Annual Limit" shall have the meaning specified in Section 5(b).
 
(c)           "Award" means any Option, SAR, Restricted Shares, Deferred Shares,
Shares granted as a bonus or in lieu of another award, Dividend Equivalent,
Other Share-Based Award, or Performance Award or Annual Incentive Award,
together with any related right or interest, granted to a Participant under the
Plan.
 
(d)           "Beneficiary" means the legal representatives of the Participant's
estate entitled by will or the laws of descent and distribution to receive the
benefits under a Participant's Award upon a Participant's death, provided that,
if and to the extent authorized by the Committee, a Participant may be permitted
to designate a Beneficiary, in which case the "Beneficiary" instead will be the
person, persons, trust or trusts (if any are then surviving) which have been
designated by the Participant in his or her most recent written and duly filed
beneficiary designation to receive the benefits specified under the
Participant's Award upon such Participant's death.
 
(e)           "Board" means the Company's Board of Directors.
 
(f)           “Change in Control” shall have the meaning specified in Section
10.
 
(g)           "Code" means the United States Internal Revenue Code of 1986, as
amended.  References to any provision of the Code or regulation thereunder shall
include any successor provisions and regulations, and reference to regulations
includes any applicable guidance or pronouncement of the Department of the
Treasury and Internal Revenue Service.
 
(h)           "Committee" means the Compensation Committee of the Board (or a
designated successor to such committee), the composition and governance of which
is established in the Committee's Charter as approved from time to time by the
Board and subject to other corporate governance documents of the Company.  No
action of the Committee shall be void or deemed to be without authority due to
the failure of any member, at the time the action was taken, to meet any
qualification standard set forth in the Committee Charter or this Plan.  The
full Board may perform any function of the Committee hereunder (except to the
extent limited under applicable New York Stock Exchange rules), in which case
the term "Committee" shall refer to the Board.
 
 
 
 
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(i)           "Covered Employee" has the meaning given to such term under Code
Section 162(m)(3) and applicable regulations thereunder.
 
(j)           "Deferred Shares" means a right, granted under this Plan, to
receive Shares or other Awards or a combination thereof at the end of a
specified deferral period.
 
(k)           "Dividend Equivalent" means a right, granted under this Plan, to
receive cash, Shares, other Awards or other property equal in value to all or a
specified portion of the dividends paid with respect to a specified number of
Shares.
 
(l)           "Effective Date" means the effective date specified in Section
11(o).
 
(m)           "Eligible Person" has the meaning specified in Section 5.
 
(n)           "Exchange Act" means the United States Securities Exchange Act of
1934, as amended.  References to any provision of the Exchange Act or rule
(including a proposed rule) thereunder shall include any successor provisions
and rules.
 
(o)           "Fair Market Value" means the fair market value of Shares, Awards
or other property as determined in good faith by the Committee or under
procedures established by the Committee.  Unless otherwise determined by the
Committee, the Fair Market Value of Shares on a given day shall be, as specified
by the Committee, the closing price of the Shares on the date on which it is to
be valued hereunder as reported for New York Stock Exchange -- Composite
Transactions.  Fair Market Value relating to the exercise price or base price of
any Non-409A Option or SAR and relating to the market value of Shares measured
at the time of exercise shall conform to requirements under Code Section 409A.
 
(p)           "409A Awards" means Awards that constitute a deferral of
compensation under Code Section 409A and regulations thereunder.  "Non-409A
Awards" means Awards other than 409A Awards.  Although the Committee retains
authority under the Plan to grant Options, SARs and Restricted Shares on terms
that will qualify those Awards as 409A Awards, Options, SARs, and Restricted
Shares are intended to be Non-409A Awards unless otherwise expressly specified
by the Committee.
 
(q)           "Incentive Stock Option" or "ISO" means any Option designated as
an incentive stock option within the meaning of Code Section 422 and qualifying
thereunder.
 
(r)           "Option" means a right to purchase Shares granted under Section
6(b).
 
(s)           "Other Share-Based Awards" means Awards granted to a Participant
under Section 6(h).
 
(t)           "Participant" means a person who has been granted an Award under
the Plan which remains outstanding, including a person who is no longer an
Eligible Person.
 
(u)           "Performance Award" means a conditional right, granted to a
Participant under Sections 6(i) or 7, to receive cash, Shares or other Awards or
payments.
 
(v)           “Preexisting Plans” means the 2000 Stock Option Plan, 2004 Stock
Option Plan and the 2007 Performance Share Plan, as the same may be amended to
the Effective Date.
 
(w)           "Restricted Shares" means Shares granted under this Plan which is
subject to certain restrictions and to a risk of forfeiture.
 
(x)           "Shares”  means the Company's class A common shares, $0.01 par
value each, and any other equity securities of the Company that may be
substituted or resubstituted for Shares pursuant to Section 11(c).
 
(y)           "Stock Appreciation Rights" or "SAR" means a right granted to a
Participant under Section 6(c).
 
 
 
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3.           Administration.
 
(a)           Authority of the Committee.  The Plan shall be administered by the
Committee, which shall have full and final authority, in each case subject to
and consistent with the provisions of the Plan, to select Eligible Persons to
become Participants; to grant Awards; to determine the type and number of
Awards, the dates on which Awards may be exercised and on which the risk of
forfeiture or deferral period relating to Awards shall lapse or terminate, the
acceleration of any such dates (including upon a Change in Control), the
expiration date of any Award, whether, to what extent, and under what
circumstances an Award may be settled, or the exercise price of an Award may be
paid, in cash, Shares, other Awards, or other property, and other terms and
conditions of, and all other matters relating to, Awards; to prescribe documents
evidencing or setting terms of Awards (such Award documents need not be
identical for each Participant or each Award), amendments thereto, and rules and
regulations for the administration of the Plan and amendments thereto; to
construe and interpret the Plan and Award documents and correct defects, supply
omissions or reconcile inconsistencies therein; and to make all other decisions
and determinations as the Committee may deem necessary or advisable for the
administration of the Plan.  Decisions of the Committee with respect to the
administration and interpretation of the Plan shall be final, conclusive, and
binding upon all persons interested in the Plan, including Participants,
Beneficiaries, transferees under Section 11(b) and other persons claiming rights
from or through a Participant, and shareholders.
 
(b)           Manner of Exercise of Committee Authority.  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 Committee may act through subcommittees, including for purposes
of qualifying Awards under Code Section 162(m) as performance-based
compensation, in which case the subcommittee shall be subject to and have
authority under the charter applicable to the Committee, and the acts of the
subcommittee shall be deemed to be acts of the Committee hereunder.  The
Committee may delegate to officers or managers of the Company or any subsidiary
or affiliate, or committees thereof, the authority, subject to such terms as the
Committee shall determine, to perform such functions, including administrative
functions, as the Committee may determine, to the extent that such delegation
(i) will not cause Awards intended to qualify as "performance-based
compensation" under Code Section 162(m) to fail to so qualify and (ii) is
permitted under applicable provisions of the laws of the Islands of Bermuda.
 
(c)           Limitation of Liability.  The Committee and each member thereof,
and any person acting pursuant to authority delegated by the Committee, shall be
entitled, in good faith, to rely or act upon any report or other information
furnished by any executive officer, other officer or employee of the Company or
a subsidiary or affiliate, the Company's independent auditors, consultants or
any other agents assisting in the administration of the Plan.  Members of the
Committee, any person acting pursuant to authority delegated by the Committee,
and any officer or employee of the Company or a subsidiary or affiliate acting
at the direction or on behalf of the Committee or a delegee shall not be
personally liable for any action or determination taken or made in good faith
with respect to the Plan, and shall, to the extent permitted by law, be fully
indemnified and protected by the Company with respect to any such action or
determination.
 
4.           Shares Subject To Plan.
 
(a)           Overall Number of Shares Available for Delivery.  The total number
of Shares  reserved and available for delivery in connection with Awards under
the Plan shall be (i) 10,000,000 Shares, plus (ii) the number of shares that,
immediately prior to the Effective Date, remain available for new awards under
the Preexisting Plans plus (iii) the number of shares subject to awards under
the Preexisting Plans which become available in accordance with Section 4(b)
after the Effective Date; provided, however, that the total number of Shares
with respect to which ISOs may be granted shall not exceed the number specified
under clause (i) above.  Any Shares delivered under the Plan shall consist of
authorized and unissued shares or treasury shares.  
 
 
 
 
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(b)           Share Counting Rules.  The Committee may adopt reasonable counting
procedures to ensure appropriate counting, avoid double counting (as, for
example, in the case of tandem or substitute Awards) and make adjustments in
accordance with this Section 4(b).  Shares shall be counted against those
reserved to the extent such Shares have been delivered and are no longer subject
to a risk of forfeiture.  Accordingly, (i) to the extent that an Award under the
Plan or an award under the Preexisting Plans, in whole or in part, is canceled,
expired, forfeited, settled in cash, settled by delivery of fewer Shares than
the number underlying the Award or award, or otherwise terminated without
delivery of Shares to the participant, the Shares retained by or returned to the
Company will not be deemed to have been delivered under the Plan; and (ii)
Shares that are withheld from such an Award or award or separately surrendered
by the participant in payment of the exercise price or taxes relating to such an
Award or award shall be deemed to constitute Shares not delivered and will be
available under the Plan.  The Committee may determine that Awards may be
outstanding that relate to more Shares than the aggregate remaining available
under the Plan so long as Awards will not in fact result in delivery and vesting
of Shares in excess of the number then available under the Plan.  In addition,
in the case of any Award granted in assumption of or in substitution for an
award of a company or business acquired by the Company or a subsidiary or
affiliate or with which the Company or a subsidiary or affiliate combines,
Shares delivered or deliverable in connection with such assumed or substitute
Award shall not be counted against the number of Shares reserved under the Plan.
 
5.            Eligibility; Per-Person Award Limitations.
 
(a)           Eligibility.  Awards may be granted under the Plan only to
Eligible Persons.  For purposes of the Plan, an "Eligible Person" means (i) an
employee of the Company or any sub­sid­iary or affiliate, including any
executive officer or employee director of the Company or a sub­sidiar­y or
affiliate, (ii) any person who has been offered employment by the Company or a
subsidiary or affiliate, provided that such prospective employee may not receive
any payment or exercise any right relating to an Award until such person has
commenced employment with the Company or a subsidiary or affiliate, (iii) any
non-employee director of the Company or any subsidiary or affiliate, and (iv)
any person who provides substantial services to the Company or a subsidiary or
affiliate.  An employee on leave of absence may be considered as still in the
employ of the Company or a subsidiary or affiliate for purposes of eligibility
for participation in the Plan.  For purposes of the Plan, a joint venture in
which the Company or a subsidiary has a substantial direct or indirect equity
investment shall be deemed an affiliate, if so determined by the
Committee.  Holders of awards granted by a company or business acquired by the
Company or a subsidiary or affiliate, or with which the Company or a subsidiary
or affiliate combines, are eligible for grants of substitute Awards granted in
connection with such acquisition or combination transaction in assumption of or
in substitution for such outstanding awards previously granted.
 
(b)           Per-Person Award Limitations.  Except as otherwise provided in an
Appendix hereto, the Committee may establish a maximum Annual Limit of shares
that any Eligible Person may be awarded in any calendar year.
 
6.            Specific Terms Of Awards.
 
(a)           General.  Awards may be granted on the terms and conditions set
forth in this Section 6.  In addition, the Committee may impose on any Award or
the exercise thereof, at the date of grant or thereafter (subject to Sections
11(e) and Appendix A), such additional terms and conditions, not inconsistent
with the provisions of the Plan, as the Committee shall determine, including
terms requiring forfeiture of Awards in the event of termination of employment
or service by the Participant and terms permitting a Participant to make
elections relating to his or her Award.  The Committee shall retain full power
and discretion with respect to any term or condition of an Award that is not
mandatory under the Plan, subject to Appendix A and the terms of the  Award
agreement.  The Committee may require payment of consideration for an Award
except as limited by the Plan.
 
 
 
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(b)           Options.  The Committee is authorized to grant Options to
Participants on the following terms and conditions:
 
 
(i)
Exercise Price.  The exercise price per Share purchasable under an Option
(including both ISOs and non-qualified Options) shall be determined by the
Committee, provided that such exercise price shall be not less than the Fair
Market Value of a Share on the date of grant of such Option, subject to Section
8(a).  Notwithstanding the foregoing, any substitute Award granted in assumption
of or in substitution for an outstanding award granted by a company or business
acquired by the Company or a subsidiary or affiliate, or with which the Company
or a subsidiary or affiliate combines may be granted with an exercise price per
Share other than as required above.  No adjustment will be made for a dividend
or other right for which the record date is prior to the date on which the
Shares are issued, except as provided in Section 11(c) of the Plan.

 
 
(ii)
Option Term; Time and Method of Exercise.  The Committee shall determine the
term of each Option, provided that in no event shall the term of any Option
exceed a period of ten years from the date of grant.  The Committee shall
determine the time or times at which or the circumstances under which an Option
may be exercised in whole or in part (including based on achievement of
performance goals and/or future service requirements), the methods by which such
exercise price may be paid or deemed to be paid and the form of such payment
(subject to Appendix A), including, without limitation, cash, Shares (including
by withholding Shares deliverable upon exercise), other Awards or awards granted
under other plans of the Company or any subsidiary or affiliate, or other
property (including through broker-assisted "cashless exercise" arrangements, to
the extent permitted by applicable law), and the methods by or forms in which
Shares will be delivered or deemed to be delivered in satisfaction of exercised
Options to Participants (including, in the case of 409A Awards, deferred
delivery of Shares subject to the Option, as mandated by the Committee, with
such deferred Shares subject to any vesting, forfeiture or other terms as the
Committee may specify).

 
 
(iii)
ISOs.  The terms of any ISO granted under the Plan shall comply in all respects
with the provisions of Code Section 422.

 
(c)           Stock Appreciation Rights.  The Committee is authorized to grant
SARs to Participants on the following terms and conditions:
 
 
(i)
Right to Payment.  An SAR shall confer on the Participant to whom it is granted
a right to receive, upon exercise thereof, the excess of (A) the Fair Market
Value of one Share on the date of exercise over (B) the grant price of the SAR
as determined by the Committee but which in any event shall be not less than the
Fair Market Value of a Share on the date of grant of the SAR, subject to Section
8(a).

 
 
(ii)
Other Terms.  The Committee shall determine the term of each SAR, provided that
in no event shall the term of an SAR exceed a period of ten years from the date
of grant.  The Committee shall determine at the date of grant or thereafter, 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 method of exercise, method of settlement, form
of consideration payable in settlement, method by or forms in which Shares will
be delivered or deemed to be delivered to Participants, whether or not an SAR
shall be free-standing or in tandem or combination with any other Award, and
whether or not the SAR will be a 409A Award or Non-409A Award.  Limited SARs
that may only be exercised in connection with a Change in

 
 
 
 
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Control or termination of service following a Change in Control as specified by
the Committee may be granted on such terms, not inconsistent with this Section
6(c), as the Committee may determine.  The Committee may require that an
outstanding Option be exchanged for an SAR exercisable for Shares having
vesting, expiration, and other terms substantially the same as the Option, so
long as such exchange will not result in additional accounting expense to the
Company.

 
 
(iii)
Purchase Price.  The Participants must pay to the Company a purchase price of
$.01 per SAR received at the time of exercise of an SAR, representing the par
value of each Share.  

 
(d)           Restricted Shares.  The Committee is authorized to grant
Restricted Shares to Participants on the following terms and conditions:
 
 
(i)
Grant and Restrictions.  Restricted Shares shall be subject to such restrictions
on transferability, risk of forfeiture and other restrictions, if any, as the
Committee may impose, which restrictions may lapse separately or in combination
at such times, under such circumstances (including based on achievement of
performance goals and/or future service requirements), in such installments or
otherwise and under such other circumstances as the Committee may determine at
the date of grant or thereafter.  Except to the extent restricted under the
terms of the Plan and any Award document relating to the Restricted Shares, a
Participant granted Restricted Shares shall have all of the rights of a
shareholder, including the right to vote the Restricted Shares and the right to
receive dividends thereon (subject to any mandatory reinvestment or other
requirement imposed by the Committee).

 
 
(ii)
Forfeiture.  Except as otherwise determined by the Committee, upon termination
of employment or service during the applicable restriction period, Restricted
Shares that are at that time subject to restrictions shall be forfeited and
reacquired by the Company; provided that the Committee may provide, by rule or
regulation or in any Award document, or may determine in any individual case,
that restrictions or forfeiture conditions relating to Restricted Shares will
lapse in whole or in part, including in the event of terminations resulting from
specified causes.

 
 
(iii)
Certificates for Shares.  Restricted Shares granted under the Plan may be
evidenced in such manner as the Committee shall determine.  If certificates
representing Restricted Shares are registered in the name of the Participant,
the Committee may require that such certificates bear an appropriate legend
referring to the terms, conditions and restrictions applicable to such
Restricted Shares, that the Company retain physical possession of the
certificates, and that the Participant deliver a stock power to the Company,
endorsed in blank, relating to the Restricted Shares.

 
 
(iv)
Dividends and Splits.  As a condition to the grant of an Award of Restricted
Shares, the Committee may require that any dividends paid on a Restricted Shares
shall be either (A) paid with respect to such Restricted Shares at the dividend
payment date in cash, in kind, or in a number of unrestricted Shares having a
Fair Market Value equal to the amount of such dividends, or (B) automatically
reinvested in additional Restricted Shares or held in kind, which shall be
subject to the same terms as applied to the original Restricted Shares to which
it relates, or (C) deferred as to payment, either as a cash deferral or with the
amount or value thereof automatically deemed reinvested in Deferred Shares,
other Awards or other investment vehicles, subject to such terms as the

 
 
 
 
 
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Committee shall determine or permit a Participant to elect.  Unless otherwise
determined by the Committee, Shares distributed in connection with a Share split
or Share dividend, and other property distributed as a dividend, shall be
subject to restrictions and a risk of forfeiture to the same extent as the
Restricted Shares with respect to which such Shares or other property has been
distributed.

 

 
(v)
Purchase Price.  The Participants must pay to the Company a purchase price of
$.01 per Restricted Share at the time of the granting of the Award, representing
the par value of each Restricted Share.

(e)           Deferred Shares.  The Committee is authorized to grant Deferred
Shares to Participants, subject to the following terms and conditions:
 
 
(i)
Award and Restrictions.  Issuance of Shares will occur upon expiration of the
deferral period specified for an Award of Deferred Shares by the Committee (or,
if permitted by the Committee, as elected by the Participant).  In addition,
Deferred Shares shall be subject to such restrictions on transferability, risk
of forfeiture and other restrictions, if any, as the Committee may impose, which
restrictions may lapse at the expiration of the deferral period or at earlier
specified times (including based on achievement of performance goals and/or
future service requirements), separately or in combination, in installments or
otherwise, and under such other circumstances as the Committee may determine at
the date of grant or thereafter.  Deferred Shares may be satisfied by delivery
of Shares, other Awards, or a combination thereof (subject to Appendix A), as
determined by the Committee at the date of grant or thereafter.

 
 
(ii)
Forfeiture.  Except as otherwise determined by the Committee, upon termination
of employment or service during the applicable deferral period or portion
thereof to which forfeiture conditions apply (as provided in the Award document
evidencing the Deferred Shares), all Deferred Shares that are at that time
subject to such forfeiture conditions shall be forfeited; provided that the
Committee may provide, by rule or regulation or in any Award document, or may
determine in any individual case, that restrictions or forfeiture conditions
relating to Deferred Shares will lapse in whole or in part, including in the
event of terminations resulting from specified causes.  Deferred Shares subject
to a risk of forfeiture may be called "restricted share units" or otherwise
designated by the Committee.

 
 
(iii)
Dividend Equivalents.  Unless otherwise determined by the Committee, Dividend
Equivalents on the specified number of Shares covered by an Award of Deferred
Shares shall be either (A) paid with respect to such Deferred Shares at the
dividend payment date in cash or in unrestricted Shares having a Fair Market
Value equal to the amount of such dividends, or (B) deferred with respect to
such Deferred Shares, either as a cash deferral or with the amount or value
thereof automatically deemed reinvested in additional Deferred Shares, other
Awards or other investment vehicles having a Fair Market Value equal to the
amount of such dividends, as the Committee shall determine or permit a
Participant to elect.

 
 
(iv)
Purchase Price.  The Participants must pay to the Company a purchase price of
$.01 per Deferred Share at the time of the granting of the Award, representing
the par value of each Deferred Share.

 
(f)           Bonus Shares and Awards in Lieu of Obligations.  The Committee is
authorized to grant to Participants Shares as a bonus, or to grant Shares or
other Awards in lieu of obligations of the Company or a subsidiary or affiliate
to pay cash or deliver other property under the Plan or under other plans or
compensatory arrangements, subject to such terms as shall be determined by the
Committee.  The Participants must pay to the Company a purchase price of $.01
per Share at the time of the granting of the Award, representing the par value
of each Share.
 
 
 
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(g)          Dividend Equivalents.  The Committee is authorized to grant
Dividend Equivalents to a Participant, which may be awarded on a free-standing
basis or in connection with another Award.  The Committee may provide that
Dividend Equivalents shall be paid or distributed when accrued or shall be
deemed to have been reinvested in additional Shares, Awards, or other investment
vehicles, and subject to restrictions on transferability, risks of forfeiture
and such other terms as the Committee may specify.
 
(h)          Other Share-Based Awards.  The Committee is authorized, subject to
limitations under applicable law, to grant to Participants such other Awards
that may be denominated or payable in, valued in whole or in part by reference
to, or otherwise based on, or related to, Shares or factors that may influence
the value of Shares, including, without limitation, convertible or exchangeable
debt securities, other rights convertible or exchangeable into Shares, purchase
rights for Shares, Awards with value and payment contingent upon performance of
the Company or business units thereof or any other factors designated by the
Committee, and Awards valued by reference to the book value of Shares or the
value of securities of or the performance of specified subsidiaries or
affiliates or other business units.  The Committee shall determine the terms and
conditions of such Awards.  Shares delivered pursuant to an Award in the nature
of a purchase right granted under this Section 6(h) shall be purchased for such
consideration, paid for at such times, by such methods, and in such forms,
including, without limitation, cash, Shares, other Awards, notes, or other
property, as the Committee shall determine.  Cash awards, as an element of or
supplement to any other Award under the Plan, may also be granted pursuant to
this Section 6(h).
 
(i)           Performance Awards.  Performance Awards, denominated in cash or in
Shares or other Awards, may be granted by the Committee in accordance with
Section 7.  A Performance Award denominated in Shares shall constitute an Award
authorized under Sections 6(b) - 6(h) to which performance conditions have been
attached under Section 7.
 
7.           Performance Awards.  Performance Awards may be denominated as a
cash amount, number of Shares, or specified number of other Awards (or a
combination) which may be earned upon achievement or satisfaction of performance
conditions specified by the Committee.  In addition, the Committee may specify
that any other Award shall constitute a Performance Award by conditioning the
right of a Participant to exercise the Award or have it settled, and the timing
thereof, upon achievement or satisfaction of such performance conditions as may
be specified by the Committee.  The Committee may use such business criteria and
other measures of performance as it may deem appropriate in establishing any
performance conditions, and may exercise its discretion to reduce or increase
the amounts payable under any Award subject to performance conditions, except as
limited under Appendix A in the case of a Performance Award intended to qualify
as "performance-based compensation" under Code Section 162(m).
 
8.           Certain Provisions Applicable To Awards.
 
(a)          Stand-Alone, Additional, Tandem, and Substitute Awards.  Awards
granted under the Plan may, in the discretion of the Committee, be granted
either alone or in addition to, in tandem with, or in substitution or exchange
for, any other Award or any award granted under another plan of the Company, any
subsidiary or affiliate, or any business entity to be acquired by the Company or
a subsidiary or affiliate, or any other right of a Participant to receive
payment from the Company or any subsidiary or affiliate; provided, however, that
a 409A Award may not be granted in tandem with a Non-409A Award.  Awards granted
in addition to or in tandem with other Awards or awards may be granted either as
of the same time as or a different time from the grant of such other Awards or
awards.  The Committee may determine that, in granting a new Award, the
in-the-money value or fair value of any surrendered Award or award or the value
of any other right to payment surrendered by the Participant may be applied to
the purchase of any other Award.  This Section 8(a) shall be subject to Section
11(e) (including the limitation on repricing) and subject to Appendix A.
 
 
 
 
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(b)           Term of Awards.  The term of each Award shall be for such period
as may be determined by the Committee, subject to the express limitations set
forth in Sections 6(b)(ii), 6(c)(ii) and 8 or elsewhere in the Plan.
 
(c)           Form and Timing of Payment under Awards; Deferrals.  Subject to
the terms of the Plan (including Appendix A) and any applicable Award document,
payments to be made by the Company or a subsidiary or affiliate upon the
exercise of an Option or other Award or settlement of an Award may be made in
such forms as the Committee shall determine, including, without limitation,
cash, Shares, other Awards or other property, and may be made in a single
payment or transfer, in installments, or on a deferred basis.  The settlement of
any Award may be accelerated, and cash paid in lieu of Shares in connection with
such settlement, in the discretion of the Committee or upon occurrence of one or
more specified events, subject to Appendix A.  Subject to Appendix A,
installment or deferred payments may be required by the Committee (subject to
Section 11(e)) or permitted at the election of the Participant on terms and
conditions established by the Committee.  Payments may include, without
limitation, provisions for the payment or crediting of reasonable interest on
installment or deferred payments or the grant or crediting of Dividend
Equivalents or other amounts in respect of installment or deferred payments
denominated in Shares.

9.           Additional Award Forfeiture Provisions.  The Committee may
condition a Participant’s right to receive a grant of an Award, to exercise the
Award, to retain cash, Shares, other Awards or other property acquired in
connection with an Award, or to retain the profit or gain realized by a
Participant in connection with an Award, including cash or other proceeds
received upon sale of Shares acquired in connection with an Award, upon
compliance by the Participant with specified conditions relating to
non-competition, confidentiality of information relating to or possessed by the
Company, non-solicitation of customers, suppliers, and employees of the Company,
cooperation in litigation, non-disparagement of the Company and its subsidiaries
and affiliates and the officers, directors and affiliates of the Company and its
subsidiaries and affiliates, and other restrictions upon or covenants of the
Participant, including during specified periods following termination of
employment or service to the Company.   Pursuant to this authorization, unless
otherwise determined by the Committee, the following policy will apply to each
Award:
 
In the event that the Company is required to restate its financial statements
due to material noncompliance of the Company with any applicable financial
reporting requirement, if such restatement results directly or indirectly from
willful misconduct or gross negligence of the Participant the Participant shall
reimburse the Company for the difference between (i) the amount of any bonus,
incentive or equity compensation paid as a result of the erroneous financial
statement and (ii) the amount that would have been paid, if any, under the
restated financial statements. The Committee may specify additional forfeitures
applicable in the event such a restatement or similar circumstances, subject to
Section 11(e).

10.             Change in Control.
 
For purposes of this Section 10, “Change in Control” means any of the following
events:

(a)           any “person” (as that term is defined for the purposes of Section
13(d) or 14(d) of the U.S. Securities Exchange Act of 1934, as amended), other
than any subsidiary of the Company, shall directly or indirectly acquire more
than 40% of the voting shares of the Company then outstanding and then entitled
to vote generally in the election of directors of the Company; or

(b)           individuals who, on the Effective Date, constitute the Company’s
Board of Directors (or the successors of such individuals nominated by such
Board of Directors or a committee thereof on which such individuals or their
successors constitute a majority) shall cease to constitute a majority of the
Company’s Board of Directors; or
 
 
 
 
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(c)           the Company amalgamates, merges or consolidates with or into any
other corporation, other than a corporation which directly, or indirectly
through one or more intermediaries, is controlled by any subsidiary of the
Company, without the approval of its Board of Directors constituted as provided
in clause (b) above; or

(d)           the Company sells, leases, exchanges or otherwise disposes of all
or substantially all of its assets and business without the approval of its
Board of Directors constituted as provided in clause (b) above.
 
In the event of a Change in Control, any outstanding Option or SAR granted under
the Plan which a Participant shall not then have been entitled to exercise shall
become exercisable and vested immediately prior to or concurrently with the
occurrence of the Change in Control and the Participant will have the right to
exercise all such Options or SARs, except to the extent this right is limited as
an explicit term of the Award established by the Committee at the time of
grant.  With respect to other types of Awards, the effect of a Change in Control
on vesting and other Award terms will be specified by the Committee.
 
Notwithstanding anything in the Plan to the contrary, in the event of exercise
of an Option or SAR following a Change in Control, the Participant may elect, by
written notice to the Committee, (i) with respect to Options only, to pay or
cause to be paid to the Company the full exercise price of the Shares as to
which the Option is exercised and thereupon receive delivery of such Shares, or
(ii) to surrender to the Company all or any part of an Option or SAR and receive
from the Company upon such surrender an amount in cash equal to the excess, if
any, of the Fair Market Value at the surrender date of the Shares subject to the
Option or SAR or portion thereof so surrendered over the aggregate exercise
price of such Shares as set forth in the applicable Option or SAR grant letter,
multiplied by the number of Shares subject to the Option or SAR or portion
thereof so surrendered.
 
The obligations of the Company under the Plan with respect to any Awards shall
be binding upon any successor company, corporation or other organization
resulting from any amalgamation, merger, consolidation or other reorganization
of the Company, or upon any successor company, corporation or organization
succeeding to all or substantially all of the assets and business of the
Company, in any such case which would constitute a Change in Control. The
Company agrees that it will make appropriate provisions for the preservation of
all Participants’ rights under the Plan in any agreement or plan that it may
enter into or adopt to effect any such amalgamation, merger, consolidation,
reorganization or transfer of assets constituting a Change in Control.
 
11.            General Provisions.
 
(a)          Compliance with Legal and Other Requirements.  The Company may, to
the extent deemed necessary or advisable by the Committee and subject to
Appendix A, postpone the issuance or delivery of Shares or payment of other
benefits under any Award until completion of such registration or qualification
of such Shares or other required action under any federal,  state or foreign
law, rule or regulation, listing or other required action with respect to any
stock exchange or automated quotation system upon which the Shares or other
securities of the Company are listed or quoted, or compliance with any other
obligation of the Company, as the Committee may consider appropriate, and may
require any Participant to make such representations, furnish such information
and comply with or be subject to such other conditions as it may consider
appropriate in connection with the issuance or delivery of Shares or payment of
other benefits in compliance with applicable laws, rules, and regulations,
listing requirements, or other obligations.  The foregoing notwithstanding, in
connection with a Change in Control, the Company shall take or cause to be taken
no action, and shall undertake or permit to arise no legal or contractual
obligation, that results or would result in any postponement of the issuance or
delivery of Shares or payment of benefits under any Award or the imposition of
any other conditions on such issuance, delivery or payment, to the extent that
such postponement or other condition would represent a greater burden on a
Participant than existed on the 90th day preceding the Change in Control.
 
 
 
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(b)          Limits on Transferability; Beneficiaries.  No Award or other right
or interest of a Participant under the Plan shall be pledged, hypothecated or
otherwise encumbered or subject to any lien, obligation or liability of such
Participant to any party (other than the Company or a subsidiary or affiliate
thereof), or assigned or transferred by such Participant otherwise than by will
or the laws of descent and distribution or to a Beneficiary upon the death of a
Participant, and such Awards or rights that may be exercisable shall be
exercised during the lifetime of the Participant only by the Participant or his
or her guardian or legal representative, except that Awards and other rights
(other than ISOs and SARs in tandem therewith) may be transferred to one or more
transferees during the lifetime of the Participant but not otherwise to a third
party for value, and may be exercised by such transferees in accordance with the
terms of such Award, but only if and to the extent such transfers are permitted
by the Committee and the Committee has determined that there will be no transfer
of the Award to a third party for value, and subject to any terms and conditions
which the Committee may impose thereon (which may include limitations the
Committee may deem appropriate in order that offers and sales under the Plan
will meet applicable requirements of registration forms under the U.S.
Securities Act of 1933, as amended,  specified by the Securities and Exchange
Commission).  A Beneficiary, transferee, or other person claiming any rights
under the Plan from or through any Participant shall be subject to all terms and
conditions of the Plan and any Award document applicable to such Participant,
except as otherwise determined by the Committee, and to any additional terms and
conditions deemed necessary or appropriate by the Committee.
 
(c)          Adjustments.  In the event that any large, non-recurring dividend
or other distribution (whether in the form of cash or property other than
Shares), recapitalization, forward or reverse split, Share dividend,
reorganization, merger, consolidation, spinoff, combination, repurchase, share
exchange, liquidation, dissolution, equity restructuring as defined under
generally accepted accounting principles, or other similar corporate transaction
or event affects the Shares such that an adjustment is determined by the
Committee to be appropriate or, in the case of any outstanding Award, which is
necessary in order to prevent dilution or enlargement of the rights of the
Participant, then the Committee shall, in an equitable manner as determined by
the Committee, adjust any or all of (i) the number and kind of Shares which may
be delivered in connection with Awards granted thereafter, including the number
of Shares available under Section 4, (ii) the number and kind of Shares by which
annual per-person Award limitations are measured under Section 5, (iii) the
number and kind of Shares subject to or deliverable in respect of outstanding
Awards, (iv) the exercise price, grant price or purchase price relating to any
Award or, if deemed appropriate, the Committee may make provision for a payment
of cash or property to the holder of an outstanding Option (subject to Appendix
A), and (v) the performance goals or conditions of outstanding Awards that are
based on share prices.  In addition, the Committee is authorized to make
adjustments in the terms and conditions of, and the criteria included in, Awards
(including Performance Awards and perfor­mance goals and any hypothetical
funding pool relating thereto) in recognition of unusual or nonrecurring events
(including, without limitation, events described in the preceding sentence, as
well as acquisitions and dispositions of businesses and assets) affecting the
Company, any sub­sid­iary or affiliate or other business unit, or the financial
statements of the Company or any subsidiary or affiliate, or in response to
changes in applicable laws, regulations, accounting principles, tax rates and
regulations or business conditions or in view of the Committee's assessment of
the business strategy of the Company, any subsidiary or affiliate or business
unit thereof, performance of comparable organizations, economic and business
conditions, personal performance of a Participant, and any other circumstances
deemed relevant; provided that no such adjustment shall be authorized or made if
and to the extent that the existence of such authority (i) would cause Options,
SARs, or Performance Awards granted under the Plan to Participants designated by
the Committee as Covered Employees and intended to qualify as "performance-based
compensation" under Code Section 162(m) and regulations thereunder to otherwise
fail to qualify as "performance-based compensation" under Code Section 162(m)
and regulations thereunder, or (ii) would cause the Committee to be deemed to
have authority to change the targets, within the meaning of Treasury Regulation
1.162-27(e)(4)(vi), under the performance goals relating to Options or SARs
granted
 
 
 
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to Covered Employees and intended to qualify as "performance-based compensation"
under Code Section 162(m) and regulations thereunder.
 
(d)          Tax Withholding.  The Company and any subsidiary or affiliate is
authorized to withhold from any Award granted, any payment relating to an Award
under the Plan, including from a distribution of Shares, or any payroll or other
payment to a Participant, amounts of withholding and other taxes due or
potentially payable in connection with any transaction involving an Award, and
to take such other action as the Committee may deem advisable to enable the
Company and Participants to satisfy obligations for the payment of withholding
taxes and other tax obligations relating to any Award.  This authority shall
include authority to withhold or receive Shares or other property and to make
cash payments in respect thereof in satisfaction of a Participant's withholding
obligations, either on a mandatory or elective basis in the discretion of the
Committee, or in satisfaction of other tax obligations.  Other provisions of the
Plan notwithstanding, only the minimum amount of Shares deliverable in
connection with an Award necessary to satisfy statutory withholding requirements
will be withheld, unless withholding of any additional amount of Shares will not
result in additional accounting expense to the Company.
 
(e)          Changes to the Plan.  The Board may amend, suspend or terminate the
Plan or the Committee's authority to grant Awards under the Plan without the
consent of shareholders or Participants; provided, however, that any amendment
to the Plan shall be submitted to the Company's shareholders for approval not
later than the earliest annual general meeting for which the record date is at
or after the date of such Board action if such shareholder approval is required
by any federal or state law or regulation or the rules of the New York Stock
Exchange, or if such amendment would materially increase the number of Shares
reserved for issuance and delivery under the Plan, and the Board may otherwise,
in its discretion, determine to submit other amendments to the Plan to
shareholders for approval.  The Committee is authorized to amend outstanding
Awards, except as limited by the Plan.  The Board and Committee may not amend
outstanding Awards (including by means of an amendment to the Plan) without the
consent of an affected Participant if such an amendment would materially and
adversely affect the rights of such Participant with respect to the outstanding
Award (for this purpose, actions that alter the timing of federal income
taxation of a Participant will not be deemed material unless such action results
in an income tax penalty on the Participant, and any discretion that is reserved
by the Board or Committee with respect to an Award is unaffected by this
provision).  Without the approval of shareholders (unless shareholder approval
is not required by any applicable law or regulation or the rules of the New York
Stock Exchange), the Committee will not amend or replace previously granted
Options or SARs in a transaction that constitutes a "repricing," which for this
purpose means any of the following or any other action that has the same effect:
 
(i)      Lowering the exercise price of an Option or SAR after it is granted;
 
 
(ii)
Any other action that is treated as a repricing under generally accepted
accounting principles;

 
 
(iii)
Canceling an Option or SAR at a time when its exercise price exceeds the fair
market value of the underlying Shares, in exchange for another Option or SAR,
Restricted Shares, other equity or cash;

 
provided, however, that the foregoing transactions shall not be deemed a
repricing if pursuant to an adjustment authorized under Section 11(c).  With
regard to other terms of Awards, the Committee shall have no authority to waive
or modify any such Award term after the Award has been granted to the extent the
waived or modified term would be mandatory under the Plan for any Award newly
granted at the date of the waiver or modification.  A cancellation and exchange
described in clause (iii) above will be considered a repricing regardless of
whether the Option, Restricted Shares or other equity is delivered
simultaneously with the cancellation, regardless of whether it is treated as a
repricing under generally accepted accounting principles, and regardless of
whether it is voluntary on the part of the Participant.
 
 
 
 
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(f)           Right of Setoff.  The Company or any subsidiary or affiliate may,
to the extent permitted by applicable law, deduct from and set off against any
amounts the Company or a subsidiary or affiliate may owe to the Participant from
time to time, including amounts payable in connection with any Award, owed as
wages, fringe benefits, or other compensation owed to the Participant, such
amounts as may be owed by the Participant to the Company, including but not
limited to amounts owed under Section 9, although the Participant shall remain
liable for any part of the Participant's payment obligation not satisfied
through such deduction and setoff.  By accepting any Award granted hereunder,
the Participant agrees to any deduction or setoff under this Section
11(f).  With respect to any amount that constitutes a deferral of compensation,
the Company may implement a setoff under this provision only at such time as the
deferred compensation otherwise would be distributable to the Participant (i.e.,
the settlement date for such deferred compensation).
 
(g)          Unfunded Status of Awards; Creation of Trusts.  The Plan is
intended to constitute an "unfunded" plan for incentive and deferred
compensation.  With respect to any payments not yet made to a Participant or
obligation to deliver Shares pursuant to an Award, nothing contained in the Plan
or any Award shall give any such Participant any rights that are greater than
those of a general creditor of the Company; provided that the Committee may
authorize the creation of trusts and deposit therein cash, Shares, other Awards
or other property, or make other arrangements to meet the Company's obligations
under the Plan.  Such trusts or other arrangements shall be consistent with the
"unfunded" status of the Plan unless the Committee otherwise determines with the
consent of each affected Participant.
 
(h)          Nonexclusivity of the Plan.  Neither the adoption of the Plan by
the Board nor its submission to the shareholders of the Company for approval
shall be construed as creating any limitations on the power of the Board or a
committee thereof to adopt such other incentive arrangements, apart from the
Plan, as it may deem desirable, including incentive arrangements and awards
which do not qualify under Code Section 162(m), and such other arrangements may
be either applicable generally or only in specific cases.
 
(i)           Payments in the Event of Forfeitures; Fractional Shares.  Unless
otherwise determined by the Committee, in the event of a forfeiture of an Award
with respect to which a Participant paid cash consideration, the Participant
shall be repaid the amount of such cash consideration.  No fractional Shares
shall be issued or delivered pursuant to the Plan or any Award.  The Committee
shall determine whether cash, other Awards or other property shall be issued or
paid in lieu of such fractional shares or whether such fractional shares or any
rights thereto shall be forfeited or otherwise eliminated.
 
(j)           Certain Limitations on Awards to Ensure Compliance with Local
Laws.  The Appendices to this Plan are incorporated by reference herein and
shall apply to Awards and deferrals by Participants who are subject to the
national laws that are addressed under each such Appendix.

(k)          Governing Law.  The validity, construction, and effect of the Plan,
any rules and regulations relating to the Plan and any Award document shall be
determined in accordance with the laws of the Islands of Bermuda and, in the
case of Appendices, laws specified therein.
 
(l)           Awards to Participants of Various Jurisdictions.  The Committee
may modify the terms of any Award under the Plan made to or held by a
Participant who is then resident or primarily employed outside of the United
States, or establish one or more Appendices or sub-plans, in any manner deemed
by the Committee to be necessary or appropriate in order that the Award shall
conform to laws, regulations, and customs of the country in which the recipient
thereof is then resident or primarily employed.  An Award may be modified under
this Section 11(l) in a manner that is inconsistent with the express terms of
the Plan, so long as such modifications will not contravene any applicable law
or regulation or result in actual liability for the Participant whose Award is
modified.
 
 
 
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(m)         Limitation on Rights Conferred under Plan.  Neither the Plan nor any
action taken hereunder shall be construed as (i) giving any Eligible Person or
Participant the right to continue as an Eligible Person or Participant or in the
employ or service of the Company or a subsidiary or affiliate, (ii) interfering
in any way with the right of the Company or a subsidiary or affiliate to
terminate any Eligible Person's or Participant's employment or service at any
time (subject to the terms and provisions of any separate written agreements),
(iii) giving an Eligible Person or Participant any claim to be granted any Award
under the Plan or to be treated uniformly with other Participants and employees,
or (iv) conferring on a Participant any of the rights of a shareholder of the
Company unless and until the Participant is duly issued or transferred Shares in
accordance with the terms of an Award or an Option is duly exercised.  Except as
expressly provided in the Plan and an Award document, neither the Plan nor any
Award document shall confer on any person other than the Company and the
Participant any rights or remedies thereunder.  Any Award shall not be deemed
compensation for purposes of computing benefits under any retirement plan of the
Company or any subsidiary or affiliate and shall not affect any benefits under
any other benefit plan at any time in effect under which the availability or
amount of benefits is related to the level of compensation (unless required by
any such other plan or arrangement with specific reference to Awards under this
Plan).
 
(n)          Severability.  If any of the provisions of this Plan or any Award
document is finally held to be invalid, illegal or unenforceable (whether in
whole or in part), such provision shall be deemed modified to the extent, but
only to the extent, of such invalidity, illegality or unenforceability, and the
remaining provisions shall not be affected thereby; provided, that, if any of
such provisions is finally held to be invalid, illegal, or unenforceable because
it exceeds the maximum scope determined to be acceptable to permit such
provision to be enforceable, such provision shall be deemed to be modified to
the minimum extent necessary to modify such scope in order to make such
provision enforceable hereunder.  The Plan and any Award documents contain the
entire agreement of the parties with respect to the subject matter thereof and
supersede all prior agreements, promises, covenants, arrangements,
communications, representations and warranties between them, whether written or
oral with respect to the subject matter thereof.  No rule of strict construction
shall be applied against the Company, the Committee, or any other person in the
interpretation of any terms of the Plan, Award, or agreement or other document
relating thereto.
 
(o)          Plan Effective Date and Termination.  The Plan shall become
effective if, and at such time as, the shareholders of the Company have approved
it at a general meeting of the Company.  The date of such shareholder approval
shall be the Effective Date.  Upon such approval of the Plan by the shareholders
of the Company, no further awards shall be granted under the Preexisting Plans,
but any outstanding awards under the Preexisting Plans shall continue in
accordance with their terms.  Unless earlier terminated by action of the Board
of Directors, the authority to make new grants under the Plan shall terminate on
the date that is ten years after the Effective Date, and the Plan will remain in
effect until such time as no Shares remain available for delivery under the Plan
and the Company has no further rights or obligations under the Plan with respect
to outstanding Awards under the Plan.
 
 
 
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APPENDIX A
 
Participants Subject to U.S. Law
 
 
 
Capitalized terms used in this Appendix have the same meaning given to them in
the Plan.
 
1.           Code Section 162(m) Considerations.
 
It is the intent of the Company that Options and SARs granted to Covered
Employees and other Awards designated as Awards to Covered Employees subject to
Appendix A shall constitute qualified "performance-based compensation" within
the meaning of Code Section 162(m) and regulations thereunder, unless otherwise
determined by the Committee at the time of allocation of an Award.  Accordingly,
the terms of this Section 1, including the definitions of Covered Employee and
other terms used herein, shall be interpreted in a manner consistent with Code
Section 162(m) and regulations thereunder.  The foregoing notwithstanding,
because the Committee cannot determine with certainty whether a given
Participant will be a Covered Employee with respect to a fiscal year that has
not yet been completed, the term Covered Employee as used herein shall mean only
a person designated by the Committee as likely to be a Covered Employee with
respect to a specified Award.  If any provision of the Plan or any Award
document relating to a Performance Award that is designated as intended to
comply with Code Section 162(m) does not comply or is inconsistent with the
requirements of Code Section 162(m) or regulations thereunder, such provision
shall be construed or deemed amended to the extent necessary to conform to such
requirements, and no provision shall be deemed to confer upon the Committee or
any other person discretion to increase the amount of compensation otherwise
payable in connection with any such Award upon attainment of the applicable
performance objectives.
 
(a)           Per-Person Award Limitations.  In each calendar year during any
part of which the Plan is in effect, an Eligible Person may be granted Awards
intended to qualify as "performance-based compensation" under Code Section
162(m) under the Plan relating to up to his or her Annual Limit.  A
Participant's Annual Limit, in any year during any part of which the Participant
is then eligible under the Plan, shall equal 250,000 Shares plus the amount of
the Participant's unused Annual Limit relating to the same type of Award as of
the close of the previous year, subject to adjustment as provided in Section
11(c) of the Plan.  In the case of an Award which is not valued in a way in
which the limitation set forth in the preceding sentence would operate as an
effective limitation satisfying applicable law (including Treasury Regulation
1.162-27(e)(3)), an Eligible Person may not be granted Awards authorizing the
earning during any calendar year of an amount that exceeds the Eligible Person's
Annual Limit, which for this purpose shall equal $2,500,000 plus the amount of
the Eligible Person's unused cash Annual Limit as of the close of the previous
year (this limitation is separate and not affected by the number of Awards
granted during such calendar year subject to the limitation in the preceding
sentence).  For this purpose, (i) "earning" means satisfying performance
conditions so that an amount becomes payable, without regard to whether it is to
be paid currently or on a deferred basis or continues to be subject to any
service requirement or other non-performance condition, (ii) a Participant's
Annual Limit is used to the extent an amount or number of Shares may be
potentially earned or paid under an Award (at the maximum designated amount for
such Awards), regardless of whether such amount or Shares are in fact earned or
paid, and (iii) the Annual Limit applies to Dividend Equivalents under Section
6(g) of the Plan only if such Dividend Equivalents are granted separately from
and not as a feature of another Award.
 
 (b)          Performance-Awards Granted to Covered Employees.  If the Committee
determines that a Performance Award to be granted to an Eligible Person who is
designated by the Committee as likely to be a Covered Employee should qualify as
"performance-based compensation" for purposes of Code Section 162(m), the grant,
exercise and/or settlement of
 
 
 
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such Performance Award shall be contingent upon achievement of a preestablished
performance goal and other terms set forth in this Section 1(b).
 
(i)           Performance Goals Generally.  The performance goal for such
Performance Awards shall consist of one or more business criteria and a targeted
level or levels of performance with respect to each of such criteria, as
specified by the Committee consistent with this Appendix A.  The performance
goal shall be objective and shall otherwise meet the requirements of Code
Section 162(m) and regulations thereunder, including the requirement that the
level or levels of performance targeted by the Committee result in the
achievement of performance goals being "substantially uncertain" at the time
such goals are established.  The Committee may determine that such Performance
Awards shall be granted, exercised and/or settled upon achievement of any one
performance goal or that two or more of the performance goals must be achieved
as a condition to grant, exercise and/or settlement of such Performance
Awards.  Performance goals may differ for Performance Awards granted to any one
Participant or to different Participants.

(ii)           Business Criteria.  One or more of the following business
criteria for the Company, on a consolidated basis, and/or for any specified
subsidiary or affiliate or other business unit of the Company (alone or in
combination), shall be used by the Committee in establishing performance goals
for such Performance Awards:
 
 
(A)
net income;

 
 
(B)
earnings, before or after income taxes;

 
 
(C)
earnings per share;

 
 
(D)
pre-tax operating income;

 
 
(E)
expense management;

 
 
(F)
profitability, including profitability of an identifiable business unit or
product;

 
 
(G)
revenue;

 
 
(H)
shareholder value creation measures, including but not limited to share price or
total shareholder return;

 
 
(I)
return measures, including return on assets (gross or net), return on
investment, return on capital, or return on equity;

 
 
(J)
cash flow, free cash flow, cash flow return on investment (discounted or
otherwise), net cash provided by operations, or cash flow in excess of cost of
capital;

 
 
(K)
net economic profit (operating earnings minus a charge for capital) or economic
value created;

 
 
(L)
strategic innovation;

 
 
(M)
dividend levels;

 
 
(N)
significant business criteria, consisting of one or more objectives based on
meeting specified market penetration, geographic business expansion goals, cost
targets, completion of capital and debt transactions, customer satisfaction,
employee satisfaction, management of employment practices and employee benefits,

 
 
 
 
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supervision of litigation and information technology, and goals relating to
acquisitions or divestitures of subsidiaries, affiliates or joint ventures; or

 
 
(O)
any combination of the foregoing. 

 
The targeted level or levels of performance with respect to such business
criteria may be established at such levels and in such terms as the Committee
may determine, in its discretion, including in absolute terms, as a goal
relative to performance in prior periods, or as a goal compared to the
performance of one or more comparable companies or an index covering multiple
companies.  Performance goals based upon these business criteria may be based
upon generally accepted accounting principles (“GAAP”) or may be non-GAAP
measures, and in either case may be adjusted for purchase accounting impacts
related to acquisitions and other extraordinary, non-recurring or unusual events
or accounting treatments (subject to applicable requirements of Code Section
162(m)).  Performance Goals may be particular to a Participant, the Company or a
division, subsidiary or other business segment of the Company, or may be based
on the performance of the Company as a whole.

(iii)           Performance Period; Timing for Establishing Performance
Goals.  Achievement of performance goals in respect of such Performance Awards
shall be measured over a performance period of up to one year or more than one
year, as specified by the Committee.  A performance goal shall be established
not later than the earlier of (A) 90 days after the beginning of any performance
period applicable to such Performance Award or (B) the time 25% of such
performance period has elapsed.

(iv)           Performance Award Pool.  The Committee may establish a
Performance Award pool, which shall be an unfunded pool, for purposes of
measuring performance of the Company in connection with Performance Awards.  The
amount of such Performance Award pool shall be based upon the achievement of a
performance goal or goals based on one or more of the business criteria set
forth in Section 1(b)(ii) hereof during the given performance period, as
specified by the Committee in accordance with Section 1(b)(iii) hereof.  The
Committee may specify the amount of the Performance Award pool as a percentage
of any of such business criteria, a percentage thereof in excess of a threshold
amount, or as another amount which need not bear a strictly mathematical
relationship to such business criteria.  The Committee may specify Performance
Awards for any one Participant as a percentage of the Performance Award pool,
subject to such terms and conditions as the Committee may specify, provided that
the aggregate percentage of the Performance Award pool allocated to Participants
may not exceed 100% of the Performance Award pool.

(v)           Settlement of Performance Awards; Other Terms.  Settlement of
Performance Awards shall be in cash, Shares, other Awards or other property, in
the discretion of the Committee.  The Committee may, in its discretion, increase
or reduce the amount of a settlement otherwise to be made in connection with
such Performance Awards, but may not exercise discretion to increase any such
amount payable to a Covered Employee in respect of a Performance Award subject
to this Appendix A beyond the level of payment authorized for achievement of the
performance goal specified under this Appendix A based on the actual level of
achievement of such goal in excess of the amount earned through performance with
respect to the performance goal established under this Appendix A.  Any
settlement which changes the form of payment from that originally specified
shall be implemented in a manner such that the Performance Award and other
related Awards do not, solely for that reason, fail to qualify as
"performance-based compensation" for purposes of Code Section 162(m).  The
Committee shall specify the circumstances in which such Performance Awards shall
be paid or forfeited in the event of termination of employment by the
Participant or other event (including a
 
 
 
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Change in Control) prior to the end of a performance period or settlement of
such Performance Awards.
 
(c)           Annual Incentive Awards Granted to Covered Employees.  The
Committee may grant an Annual Incentive Award to an Eligible Person who is
designated by the Committee as likely to be a Covered Employee.  Such Annual
Incentive Award will be intended to qualify as "performance-based compensation"
for purposes of Code Section 162(m), and its grant, exercise and/or settlement
shall be contingent upon achievement of preestablished performance goals and
other terms set forth in this Section 1(c).
 
(i)           Grant of Annual Incentive Awards.  Not later than the earlier of
90 days after the beginning of any performance period applicable to such Annual
Incentive Award or the time 25% of such performance period has elapsed, the
Committee shall determine the Covered Employees who will potentially receive
Annual Incentive Awards, and the amount(s) potentially payable thereunder, for
that performance period.  The amount(s) potentially payable shall be based upon
the achievement of a performance goal or goals based on one or more of the
business criteria set forth in Section 1(b)(ii) hereof in the given performance
period, as specified by the Committee.  The Committee may designate an annual
incentive award pool as the means by which Annual Incentive Awards will be
measured, which pool shall conform to the provisions of Section 1(b)(iv)
hereof.  In such case, the portion of the Annual Incentive Award pool
potentially payable to each Covered Employee shall be preestablished by the
Committee.  In all cases, the maximum Annual Incentive Award of any Participant
shall be subject to the limitation set forth in Section 1(a) hereof.

(ii)           Payout of Annual Incentive Awards.  After the end of each
performance period, the Committee shall determine the amount, if any, of the
Annual Incentive Award for that performance period payable to each
Participant.  The Committee may, in its discretion, determine that the amount
payable to any Participant as a final Annual Incentive Award shall be reduced
from the amount of his or her potential Annual Incentive Award, including a
determination to make no final Award whatsoever, but may not exercise discretion
to increase any such amount.  The Committee shall specify the circumstances in
which an Annual Incentive Award shall be paid or forfeited in the event of
termination of employment by the Participant or other event prior to the end of
a performance period or settlement of such Annual Incentive Award.
 
(d)           Written Determinations.  Determinations by the Committee as to the
establishment of performance goals, the amount potentially payable in respect of
Performance Awards and Annual Incentive Awards, the level of actual achievement
of the specified performance goals relating to Performance Awards and Annual
Incentive Awards, and the amount of any final Performance Award and Annual
Incentive Awards shall be recorded in writing in the case of Awards intended to
qualify under Section 162(m).  Specifically, the Committee shall certify in
writing, in a manner conforming to applicable regulations under Section 162(m),
prior to settlement of each such Award granted to a Covered Employee, that the
performance objective relating to the Performance Award or Annual Incentive
Award and other material terms of the Award upon which settlement of the Award
was conditioned have been satisfied.
 
2.           Code Section 409A Considerations.
 
(a)           409A Awards and Deferrals.  Other provisions of the Plan
notwithstanding, the terms of any 409A Award, including any authority of the
Company and rights of the Participant with respect to the 409A Award, shall be
limited to those terms permitted under Code Section 409A, and any terms not
permitted under Code Section 409A shall be modified and limited to the extent
necessary to conform with Code Section 409A but only to the extent that such
modification or limitation is permitted under Code Section 409A and the
regulations and guidance issued thereunder.  The following rules will apply to
409A Awards:
 
 
 
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(i)           Elections. If a Participant is permitted to elect to defer an
Award or any payment under an Award, such election will be permitted in
accordance with the provisions specified in Exhibit A hereto;

(ii)           Exercise and Distribution.  Except as provided in Section
2(a)(iii) hereof, no 409A Award shall be exercisable (if the exercise would
result in a distribution) or otherwise distributable to a Participant (or his or
her beneficiary) except upon the occurrence of one of the following (or a date
related to the occurrence of one of the following), which must be specified in a
written document governing such 409A Award and otherwise meet the requirements
of Treasury Regulation § 1.409A-3:
 
 
(A)
Specified Time.  A specified time or a fixed schedule.

 
 
(B)
Separation from Service.  The Participant’s separation from service (within the
meaning of Treasury Regulation § 1.409A-1(h) and other applicable rules under
Code Section 409A); provided, however, that if the Participant is a “key
employee” (as defined in Code Section 416(i) without regard to paragraph (5)
thereof) and any of the Company’s equity is publicly traded on an established
securities market or otherwise, settlement under this Section 2(a)(ii)(B) may
not be made before the date that is six months after the date of separation from
service.

 
 
(C)
Death.  The death of the Participant.

 
 
(D)
Disability.  The date the Participant has experienced a 409A Disability (as
defined below).

 
 
(E)
409A Ownership/Control Change.  The occurrence of a 409A Ownership/Control
Change (as defined below).

 
(iii)           No Acceleration.  The exercise or distribution of a 409A Award
may not be accelerated prior to the time specified in Section 2(a)(ii) hereof,
except in the case of one of the following events:
 
 
(A)
Domestic Relations Order.  The 409A Award may permit the acceleration of the
exercise or distribution time or schedule to an individual other than the
Participant as may be necessary to comply with the terms of a domestic relations
order (as defined in Section 414(p)(1)(B) of the Code).

 
 
(B)
Conflicts of Interest.  Such 409A Award may permit the accelera­tion of the
settlement time or schedule as may be necessary to comply with an ethics
agreement with the Federal government or if reasonably necessary to comply with
a Federal, state, local or foreign ethics law or conflict of interest law in
compliance with Treasury Regulation § 1.409A-3(j)(4)(iii).

 
 
(C)
Change.  The Committee may exercise the discretionary right to accelerate the
vesting of any unvested compensation deemed to be a 409A Award upon a 409A
Ownership/Control Change or to terminate the Plan upon or within 12 months after
a 409A Ownership/Control Change, or otherwise to the extent permitted under
Treasury Regulation § 1.409A-3(j)(4)(ix), or accelerate settlement of such 409A
Award in any other circum­stance permitted under Treasury Regulation
§ 1.409A-3(j)(4).

 
(iv)           Definitions.  For purposes of this Appendix A, the following
terms shall be defined as set forth below:
 
 
 
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(A)
“409A Ownership/Control Change” shall be deemed to have occurred if a Change in
Control occurs in connection with which there occurs a change in the ownership
of the Company, a change in effective control of the Company, or a change in the
ownership of a substantial portion of the assets of the Company, within the
meaning of Treasury Regulation § 1.409A-3(i)(5).

 
 
(B)
“409A Disability” means an event which results in the Participant (i) being
unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment that can be expected to result in
death or can be expected to last for a continuous period of not less than 12
months, or (ii), by reason of any medically determinable physical or mental
impairment that can be expected to result in death or can be expected to last
for a continuous period of not less than 12 months, receiving income replacement
benefits for a period of not less than three months under an accident and health
plan covering employees of the Company or its subsidiaries.

 
(v)           Determination of “Key Employee.”  For purposes of a settlement
under Section 2(a)(ii), status of a Participant as a “key employee” shall be
determined annually under the Company’s administrative procedure for such
determination for purposes of all plans subject to Code Section 409A.

(vi)           Non-Transferability.  The provisions of Section 11(b) of the Plan
notwithstanding, no 409A Award or right relating thereto shall be subject to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment, or garnishment by creditors of the Participant or the Participant's
Beneficiary.

(vii)           Limitation on Setoffs.  If the Company has a right of setoff
that could apply to a 409A Award, such right may only be exercised at the time
the 409A Award would have been distributed to the Participant or his or her
Beneficiary, and may be exercised only as a setoff against an obligation that
arose not more than 30 days before and within the same year as the distribution
date if application of such setoff right against an earlier obligation would not
be permitted under Code Section 409A.

(viii)          409A Rules Do Not Constitute Waiver of Other Restrictions.  The
rules applicable to 409A Awards under this Appendix A constitute further
restrictions on terms of Awards set forth elsewhere in this Plan.  Thus, for
example, an Option or SAR that is a 409A Award shall be subject to restrictions,
including restrictions on rights otherwise specified in Section 6(b) or 6(c) of
the Plan, in order that such Award shall not result in constructive receipt of
income before exercise or tax penalties under Code Section 409A.
 
(b)           Rules Applicable to Certain Participants Transferred to
Affiliates.  For purposes of determining a separation from service (where the
use of the following modified definition is based upon legitimate business
criteria), in applying Code Sections 1563(a)(1), (2) and (3) for purposes of
determining a controlled group of corporations under Code Section 414(b), the
language “at least 20 percent” shall be used instead of “at least 80 percent” at
each place it appears in Sections 1563(a)(1), (2) and (3), and in applying
Treasury Regulation § 1.414(c)-2 (or any successor provision) for purposes of
determining trades or businesses (whether or not incorporated) that are under
common control for purposes of Code Section 414(c), the language “at least 20
percent” shall be used instead of “at least 80 percent” at each place it appears
in Treasury Regulation § 1.414(c)-2.
 
(c)           Distributions Upon Vesting.  In the case of any Award providing
for a distribution upon the lapse of a substantial risk of forfeiture, if the
timing of such distribution is not otherwise specified in the Plan or an Award
agreement or other governing document, the distribution shall
 
 
 
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be made not later than March 15 of the year following the year in which the
substantial risk of forfeiture lapsed, provided that the Participant shall have
no influence on any determination as to the tax year in which the distribution
will be made.
 
(d)           Release or Other Termination Agreement.  If the Company requires a
Participant to execute a release, non-competition, or other agreement as a
condition to receipt of a payment or retention of an Award upon or following a
termination of employment, the Company will supply to the Participant a form of
such release or other document not later than the date of the Participant's
termination of employment, which must be returned within the minimum time period
required by law (but not more than 45 days) and must not be revoked by the
Participant within the applicable time period for revocation in order for the
Participant to satisfy any such condition.  If any amount payable during a fixed
period following termination of employment is subject to such a requirement and
the fixed period would begin in one tax year and end in the next tax year, the
Company, in determining the time of payment of any such amount, will not be
influenced by the timing of any action of the Participant including execution of
such a release or other document and expiration of any revocation period.  In
particular, the Company will be entitled in its discretion to deposit any such
payment in escrow during either year comprising such fixed period, so that such
deposited amount is constructively received and taxable income to the
Participant upon deposit but with distribution from such escrow remaining
subject to the Participant's execution and non-revocation of such release or
other document.
 
(e)           Scope and Application of this Provision.  For purposes of this
Appendix A, references to a term or event (including any authority or right of
the Company or a Participant) being “permitted” under Code Section 409A mean
that the term or event will not cause the Participant to be deemed to be in
constructive receipt of compensation relating to the 409A Award prior to the
distribution of cash, shares or other property or to be liable for payment of
interest or a tax penalty under Code Section 409A.
 
3.           Required Consent to and Notification of Code Section 83(b)
Election.  No election under Section 83(b) of the Code (to include in gross
income in the year of transfer the amounts specified in Code Section 83(b)) or
under a similar provision of the laws of a jurisdiction outside the United
States may be made unless expressly permitted by the terms of the Award document
or by action of the Committee in writing prior to the making of such
election.  In any case in which a Participant is permitted to make such an
election in connection with an Award, the Participant shall notify the Company
of such election within ten days of filing notice of the election with the
Internal Revenue Service or other governmental authority, in addition to any
filing and notification required pursuant to regulations issued under Code
Section 83(b) or other applicable provision.
 
4.           Additional ISO Considerations.
 
(a)           Ten Percent Shareholders.  A person who owns (or is deemed to own
pursuant to Code Section 424(d)) shares possessing more than 10% of the total
combined voting power of all classes of shares of the Company or any subsidiary
of the Company shall not be granted an ISO unless the exercise price of such ISO
is at least 110% of the Fair Market Value of the underlying Share on the date of
grant and the ISO is not exercisable after the expiration of five (5) years from
the date of grant.
 
(b)           ISO Limitation.  To the extent that the aggregate Fair Market
Value (determined at the time of grant) of Shares with respect to which ISOs are
exercisable for the first time by any individual during any calendar year (under
all plans of the Company and its subsidiaries) exceeds $100,000, the Options or
portions thereof that exceed such limit (according to the order in which they
were granted) shall be treated as non-qualified Options, notwithstanding any
contrary provisions of the applicable Option Award.
 
(c)           Requirement of Notification Upon Disqualifying Disposition Under
Code Section 421(b).  If any Participant shall make any disposition of Shares
delivered pursuant to the exercise
 
 
 
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of an ISO under the circumstances described in Code Section 421(b) (i.e., a
disqualifying disposition), such Participant shall notify the Company of such
disposition within ten days thereof.
 
5.           [Reserved].
 
6.           Governing Law.  The construction and effect of this Appendix A, any
rules and regulations relating to any 409A Award document shall be determined in
accordance with applicable provisions of the Code.
 
 

 
 
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Exhibit A to Appendix A

Deferral Election Rules

If a participant in a plan, program or other compensatory arrangement (a "plan")
of Orient-Express Hotels Ltd. (the "Company") is permitted to elect to defer
awards or other compensation, any such election relating to compensation
deferred under the applicable plan must be received by the Company prior to the
date specified by or at the direction of the administrator of such plan (the
"Administrator," which in most instances will be the Human Resources
Department).  For purposes of compliance with Section 409A of the Internal
Revenue Code (the "Code"), any such election to defer shall be subject to the
rules set forth below, subject to any additional restrictions as may be
specified by the Administrator.  Under no circumstances may a participant elect
to defer compensation to which he or she has attained, at the time of deferral,
a legally enforceable right to current receipt of such compensation.

 
(1)
Initial Deferral Elections.  Any initial election to defer compensation
(including the election as to the type and amount of compensation to be deferred
and the time and manner of settlement of the deferral) must be made (and shall
be irrevocable) no later than December 31 of the year before the participant’s
services are performed which will result in the earning of the compensation,
except as follows:

 
•
Initial deferral elections with respect to compensation that, absent the
election, constitutes a short-term deferral may be made in accordance with
Treasury Regulation § 1.409A-2(a)(4) and (b);

 
•
Initial deferral elections with respect to compensation that remains subject to
a requirement that the participant provide services for at least 12 months (a
“forfeitable right” under Treasury Regulation § 1.409A-2(a)(5)) may be made on
or before the 30th day after the participant obtains the legally binding right
to the compensation, provided that the election is made at least 12 months
before the earliest date at which the forfeiture condition could lapse and
otherwise in compliance with Treasury Regulation § 1.409A-2(a)(5);

 
•
Initial deferral elections by a participant in his or her first year of
eligibility may be made within 30 days after the date the participant becomes
eligible to participate in the applicable plan, with respect to compensation
paid for services to be performed after the election and in compliance with
Treasury Regulation § 1.409A-2(a)(7);

 
•
Initial deferral elections by a participant with respect to performance-based
compensation (as defined under Treasury Regulation § 1.409A-1(e)) may be made on
or before the date that is six months before the end of the performance period,
provided that (i) the participant was employed continuously from either the
beginning of the performance period or the later date on which the performance
goal was established, (ii) the election to defer is made before such
compensation has become readily ascertainable (i.e., substantially certain to be
paid), (iii) the performance period is at least 12 months in length and the
performance goal was established no later than 90 days after the commencement of
the service period to which the performance goal relates, (iv) the
performance-based compensation is not payable in the absence of  performance
except due to death, disability, a 409A Ownership/Control Change (as defined in
Section 2(a)(iv)(A) of Appendix A of the 2009 Share Award and Incentive Plan) or
as otherwise permitted under Treasury Regulation § 1.409A-1(e), and (v) this
initial deferral election must in any event comply with Treasury Regulation
§ 1.409A-2(a)(8);

 
 
 
 
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•
Initial deferral elections resulting in Company matching contributions may be
made in compliance with Treasury Regulation § 1.409A-2(a)(9);

 
•
Initial deferral elections may be made to the fullest permitted under other
applicable provisions of Treasury Regulation § 1.409A-2(a); and

 
(2)
Further Deferral Elections.  The foregoing notwithstanding, for any election to
further defer an amount that is deemed to be a deferral of compensation subject
to Code Section 409A (to the extent permitted under Company plans, programs and
arrangements), any further deferral election made under the plan shall be
subject to the following:

 
•
The further deferral election will not take effect until at least 12 months
after the date on which the election is made;

 
•
If the election relates to a distribution event other than a Disability (as
defined in Treasury Regulation § 1.409A-3(i)(4)), or death, the payment with
respect to which such election is made must be deferred for a period of not less
than five years from the date such payment would otherwise have been paid (or in
the case of a life annuity or installment payments treated as a single payment,
five years from the date the first amount was scheduled to be paid), to the
extent required under Treasury Regulation § 1.409A-2(b);

 
•
The requirement that the further deferral election be made at least 12 months
before the original deferral amount would be first payable may not be waived by
the Administrator, and shall apply to a payment at a specified time or pursuant
to a fixed schedule (and in the case of a life annuity or installment payments
treated as a single payment, 12 months before the date that the first amount was
scheduled to be paid);

 
•
The further deferral election shall be irrevocable when filed with the Company;
and

 
•
The further deferral election otherwise shall comply with the applicable
requirements of Treasury Regulation § 1.409A-2(b).

 
(3)
Transition Rules.  Initial deferral elections and elections to change any
existing deferred date for distribution of compensation in any transition period
designated under Department of the Treasury and IRS regulations may be permitted
by the Company to the fullest extent authorized under transition rules and other
applicable guidance under Code Section 409A.

 

 
 

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