Exhibit 10.4
Horizon Global Corporation
2020 Equity and Incentive Compensation Plan

1.Purpose. The purpose of this Plan is to permit award grants to non-employee
Directors, officers and other employees of the Company and its Subsidiaries, and
certain consultants to the Company and its Subsidiaries, and to provide to such
persons incentives and rewards for performance and/or service.
2.Definitions. As used in this Plan:
(a)“Appreciation Right” means a right granted pursuant to Section 5 of this
Plan.
(b)“Base Price” means the price to be used as the basis for determining the
Spread upon the exercise of an Appreciation Right.
(c)“Board” means the Board of Directors of the Company.
(d)“Cash Incentive Award” means a cash award granted pursuant to Section 8 of
this Plan.
(e)“Change in Control” has the meaning set forth in Section 12 of this Plan.
(f)“Code” means the Internal Revenue Code of 1986, as amended from time to time,
and the regulations thereunder, as such law and regulations may be amended from
time to time.
(g)“Committee” means the Compensation Committee of the Board (or its
successor(s)), or any other committee of the Board designated by the Board to
administer this Plan pursuant to Section 10 of this Plan.
(h)“Common Shares” means the shares of common stock, par value $0.01 per share,
of the Company or any security into which such common stock may be changed by
reason of any transaction or event of the type referred to in Section 11 of this
Plan.
(i)“Company” means Horizon Global Corporation, a Delaware corporation, and its
successors.
(j)“Date of Grant” means the date provided for by the Committee on which a grant
of Option Rights, Appreciation Rights, Performance Shares, Performance Units,
Cash Incentive Awards, or other awards contemplated by Section 9 of this Plan,
or a grant or sale of Restricted Shares, Restricted Stock Units, or other awards
contemplated by Section 9 of this Plan, will become effective (which date will
not be earlier than the date on which the Committee takes action with respect
thereto).
(k)“Director” means a member of the Board.
(l)“Effective Date” means the date this Plan is approved by the Shareholders.
(m)“Evidence of Award” means an agreement, certificate, resolution or other type
or form of writing or other evidence approved by the Committee that sets forth
the terms and conditions of the awards granted under this Plan. An Evidence of
Award may be in an electronic medium, may be limited to notation on the books
and records of the Company and, unless otherwise determined by the Committee,
need not be signed by a representative of the Company or a Participant.
(n)“Exchange Act” means the Securities Exchange Act of 1934, as amended from
time to time, and the rules and regulations thereunder, as such law, rules and
regulations may be amended from time to time.
(o)“Incentive Stock Option” means an Option Right that is intended to qualify as
an “incentive stock option” under Section 422 of the Code or any successor
provision.
(p)“Management Objectives” means the measurable performance objective or
objectives established pursuant to this Plan for Participants who have received
grants of Performance Shares, Performance Units or Cash Incentive Awards or,
when so determined by the Committee, Option Rights, Appreciation Rights,
Restricted Shares, Restricted Stock Units, dividend equivalents or other awards
pursuant to this Plan. The Management Objectives applicable to an award under
this Plan (if any) shall be determined by the Committee, and may be based on one
or more, or a combination, of the following metrics or such other metrics as may
be determined by the Committee (including relative or growth achievement
regarding such metrics):
(i)Profits (e.g., gross profit, EBITDA, operating income, EBIT, EBT, net income,
net sales, cost of sales, earnings per share, residual or economic earnings,
inventory turnover, operating profit, economic profit - these profitability
metrics could be measured before certain specified special items and/or subject
to GAAP definition);
(ii)Cash Flow (e.g., free cash flow, free cash flow with or without specific
capital expenditure target or range, including or excluding divestments and/or
acquisitions, net cash provided by operating activities, net increase (or
decrease) in cash and cash equivalents, total cash flow, cash flow in excess of
cost of capital or residual cash flow or cash flow return on investment);
(iii)Returns (e.g., profits or cash flow returns on: assets, invested capital,
net capital employed, and equity);
(iv)Working Capital (e.g., working capital divided by sales, days’ sales
outstanding, days’ sales inventory, and days’ sales in payables);
(v)Profit Margins (e.g., profits divided by revenues, gross margins and material
margins divided by revenues, and material margin divided by weight or volume);
(vi)Liquidity Measures (e.g., debt-to-capital, debt-to-EBITDA, total debt
ratio);
(vii)Sales Growth, Gross Margin Growth, Cost Initiative and Stock Price Metrics
(e.g., revenues, revenue growth, revenue growth outside the United States, gross
margin and gross margin growth,
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Exhibit 10.4
material margin and material margin growth, stock price appreciation, market
capitalization, total return to shareholders, sales and administrative costs
divided by sales, and sales and administrative costs divided by profits); and
(viii)Strategic Initiative Key Deliverable Metrics consisting of one or more of
the following: product development, strategic partnering, research and
development, vitality index, market penetration, market share, geographic
business expansion goals, cost targets, selling, general and administrative
expenses, customer satisfaction, employee satisfaction, management of employment
practices and employee benefits, supervision of litigation and information
technology, productivity, economic value added (or another measure of
profitability that considers the cost of capital employed), product quality,
sales of new products, and goals relating to acquisitions or divestitures of
subsidiaries, affiliates and joint ventures.
If the Committee determines that a change in the business, operations, corporate
structure or capital structure of the Company, or the manner in which it
conducts its business, or other events or circumstances render the Management
Objectives unsuitable, the Committee may in its discretion modify such
Management Objectives or the goals or actual levels of achievement regarding the
Management Objectives, in whole or in part, as the Committee deems appropriate
and equitable.
(q)“Market Value per Share” means, as of any particular date, the closing price
of a Common Share as reported for that date on the New York Stock Exchange or,
if the Common Shares are not then listed on the New York Stock Exchange, on any
other national securities exchange on which the Common Shares are listed, or if
there are no sales on such date, on the next preceding trading day during which
a sale occurred. If there is no regular public trading market for the Common
Shares, then the Market Value per Share shall be the fair market value as
determined in good faith by the Committee. The Committee is authorized to adopt
another fair market value pricing method provided such method is stated in the
applicable Evidence of Award and is in compliance with the fair market value
pricing rules set forth in Section 409A of the Code.
(r)“Optionee” means the optionee named in an Evidence of Award evidencing an
outstanding Option Right.
(s)“Option Price” means the purchase price payable on exercise of an Option
Right.
(t)“Option Right” means the right to purchase Common Shares upon exercise of an
award granted pursuant to Section 4 of this Plan.
(u)“Participant” means a person who is selected by the Committee to receive
benefits under this Plan and who is at the time (i) a non-employee Director,
(ii) an officer or other employee of the Company or any Subsidiary, including a
person who has agreed to commence serving in such capacity within 90 days of the
Date of Grant, or (iii) a person, including a consultant, who provides services
to the Company or any Subsidiary that are equivalent to those typically provided
by an employee (provided that such person satisfies the Form S-8 definition of
an “employee”).
(v)“Performance Period” means, in respect of a Cash Incentive Award, Performance
Share or Performance Unit, a period of time established pursuant to Section 8 of
this Plan within which the Management Objectives relating to such Cash Incentive
Award, Performance Share or Performance Unit are to be achieved.
(w)“Performance Share” means a bookkeeping entry that records the equivalent of
one Common Share awarded pursuant to Section 8 of this Plan.
(x)“Performance Unit” means a bookkeeping entry awarded pursuant to Section 8 of
this Plan that records a unit equivalent to $1.00 or such other value as is
determined by the Committee.
(y)“Plan” means this Horizon Global Corporation 2020 Equity and Incentive
Compensation Plan, as may be amended or amended and restated from time to time.
(z)“Predecessor Plan” means the Horizon Global Corporation 2015 Equity and
Incentive Compensation Plan, including as amended or amended and restated from
time to time.
(aa)“Restricted Shares” means Common Shares granted or sold pursuant to
Section 6 of this Plan as to which neither the substantial risk of forfeiture
nor the prohibition on transfers has expired.
(bb)“Restricted Stock Units” means an award made pursuant to Section 7 of this
Plan of the right to receive Common Shares, cash or a combination thereof at the
end of the applicable Restriction Period.
(cc)“Restriction Period” means the period of time during which Restricted Stock
Units are subject to restrictions, as provided in Section 7 of this Plan.
(dd)“Shareholder” means an individual or entity that owns one or more Common
Shares.
(ee)“Spread” means the excess of the Market Value per Share on the date when an
Appreciation Right is exercised over the Base Price provided for with respect to
the Appreciation Right.
(ff)“Subsidiary” means a corporation, company or other entity (i) more than 50%
of whose outstanding shares or securities (representing the right to vote for
the election of directors or other managing authority) are, or (ii) which does
not have outstanding shares or securities (as may be the case in a partnership,
joint venture, limited liability company, unincorporated association or other
similar entity), but more than 50% of whose ownership interest representing the
right generally to make decisions for such other entity is, now or hereafter,
owned or controlled, directly or indirectly, by the Company; provided, however,
that for purposes of determining whether any person may be a Participant for
purposes of any grant of Incentive Stock Options, “Subsidiary”
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Exhibit 10.4
means any corporation in which the Company at the time owns or controls,
directly or indirectly, more than 50% of the total combined Voting Power
represented by all classes of stock issued by such corporation.
(gg)“Voting Power” means, at any time, the combined voting power of the
then-outstanding securities entitled to vote generally in the election of
Directors in the case of the Company, or members of the board of directors or
similar body in the case of another entity.
3.Shares Available Under this Plan.
(a)Maximum Shares Available Under this Plan.
(i)Subject to adjustment as provided in Section 11 of this Plan and the share
counting rules set forth in Section 3(b) of this Plan, the number of Common
Shares available under this Plan for awards of (A) Option Rights or Appreciation
Rights, (B) Restricted Shares, (C) Restricted Stock Units, (D) Performance
Shares or Performance Units, (E) awards contemplated by Section 9 of this Plan,
or (F) dividend equivalents paid with respect to awards made under this Plan
will not exceed in the aggregate (x) 3,800,752 Common Shares, plus (y) the total
number of Common Shares remaining available for awards under the Predecessor
Plan as of the Effective Date, plus (z) the Common Shares that are subject to
awards granted under this Plan or the Predecessor Plan that are added (or added
back, as applicable) to the aggregate number of Common Shares available under
this Section 3(a)(i) pursuant to the share counting rules of this Plan. Such
shares may be shares of original issuance or treasury shares or a combination of
the foregoing.
(ii)Subject to the share counting rules set forth in Section 3(b) of this Plan,
the aggregate number of Common Shares available under Section 3(a)(i) of this
Plan will be reduced by one Common Share for every one Common Share subject to
an award granted under this Plan.
(b)Share Counting Rules.
(i)Except as provided in Section 22 of this Plan, if any award granted under
this Plan (in whole or in part) is cancelled or forfeited, expires, is settled
for cash, or is unearned, the Common Shares subject to such award will, to the
extent of such cancellation, forfeiture, expiration, cash settlement, or
unearned amount, again be available under Section 3(a)(i) above.
(ii)If, after the Effective Date, any Common Shares subject to an award granted
under the Predecessor Plan are forfeited, or an award granted under the
Predecessor Plan (in whole or in part) is cancelled or forfeited, expires, is
settled for cash, or is unearned, the Common Shares subject to such award will,
to the extent of such cancellation, forfeiture, expiration, cash settlement, or
unearned amount, be available for awards under this Plan.
(iii)Notwithstanding anything to the contrary contained in this Plan: (A) Common
Shares withheld by the Company, tendered or otherwise used in payment of the
Option Price of an Option Right (or the option price of an option granted under
the Predecessor Plan) will not be added (or added back, as applicable) to the
aggregate number of Common Shares available under Section 3(a)(i) of this Plan;
(B) Common Shares withheld by the Company, tendered or otherwise used to satisfy
tax withholding with respect to awards (other than as described in clause (C))
will not be added (or added back, as applicable) to the aggregate number of
Common Shares available under Section 3(a)(i) of this Plan; (C) Common Shares
withheld by the Company, tendered or otherwise used to satisfy tax withholding
with respect to awards other than Option Rights or Appreciation Rights (or
options or stock appreciation rights granted under the Predecessor Plan) will be
added back to the aggregate number of Common Shares available under
Section 3(a)(i) of this Plan (provided, however, that such recycling of Common
Shares for tax withholding purposes will be limited to 10 years from the date of
Shareholder approval of the Plan if such recycling involves Common Shares that
have actually been issued by the Company); (D) Common Shares subject to a
share-settled Appreciation Right that are not actually issued in connection with
the settlement of such Appreciation Right on the exercise thereof will not be
added (or added back, as applicable) to the aggregate number of Common Shares
available under Section 3(a)(i) of this Plan; and (E) Common Shares reacquired
by the Company on the open market or otherwise using cash proceeds from the
exercise of Option Rights will not be added (or added back, as applicable) to
the aggregate number of Common Shares available under Section 3(a)(i) of this
Plan.
(iv)If, under this Plan, a Participant has elected to give up the right to
receive compensation in exchange for Common Shares based on fair market value,
such Common Shares will not count against the aggregate limit under Section
3(a)(i) of this Plan.
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Exhibit 10.4
(c)Limit on Incentive Stock Options. Notwithstanding anything to the contrary
contained in this Plan, and subject to adjustment as provided in Section 11 of
this Plan, the aggregate number of Common Shares actually issued or transferred
by the Company upon the exercise of Incentive Stock Options will not exceed
3,800,752 Common Shares.
(d)Non-Employee Director Compensation Limit. Notwithstanding anything to the
contrary contained in this Plan, in no event will any non-employee Director in
any one calendar year be granted compensation for such service having an
aggregate maximum value (measured at the Date of Grant as applicable, and
calculating the value of any awards based on the grant date fair value for
financial reporting purposes) in excess of $500,000. The independent members of
the Board may make exceptions to this limit up to an additional $200,000 for a
non-executive chair of the Board, provided that the non-employee Director
receiving such additional compensation may not participate in the decision to
award such compensation.
(e)Minimum Vesting Requirement. Notwithstanding any other provision of this Plan
(outside of this Section 3(e)) to the contrary, awards granted under this Plan
(other than cash-based awards) shall vest no earlier than the first anniversary
of the applicable Date of Grant; provided, that the following awards shall not
be subject to the foregoing minimum vesting requirement: any (i) awards granted
in connection with awards that are assumed, converted or substituted pursuant to
Section 22(a) of this Plan; (ii) Common Shares delivered in lieu of fully vested
cash obligations; (iii) awards to non-employee Directors that vest on the
earlier of the one-year anniversary of the applicable Date of Grant and the next
annual meeting of Shareholders which is at least 50 weeks after the immediately
preceding year’s annual meeting of Shareholders; and (iv) any additional awards
the Committee may grant, up to a maximum of five percent (5%) of the available
share reserve authorized for issuance under the Plan pursuant to Section 3(a)(i)
(subject to adjustment under Section 11). Nothing in this Section 3(e) or
otherwise in this Plan, however, shall preclude the Committee, in is sole
discretion, from (x) providing for continued vesting or accelerated vesting for
any award under this Plan upon certain events, including in connection with or
following a Participant’s death, disability, or termination of service or a
Change in Control, or (y) exercising its authority under Section 18(c) at any
time following the grant of an award.
4.Option Rights. The Committee may, from time to time and upon such terms and
conditions as it may determine, authorize the granting to Participants of Option
Rights. Each such grant may utilize any or all of the authorizations, and will
be subject to all of the requirements, contained in the following provisions:
(a)Each grant will specify the number of Common Shares to which it pertains
subject to the limitations set forth in Section 3 of this Plan.
(b)Each grant will specify an Option Price per Common Share, which Option Price
(except with respect to awards under Section 22 of this Plan) may not be less
than the Market Value per Share on the Date of Grant.
(c)Each grant will specify whether the Option Price will be payable (i) in cash,
by check acceptable to the Company or by wire transfer of immediately available
funds, (ii) by the actual or constructive transfer to the Company of Common
Shares owned by the Optionee having a value at the time of exercise equal to the
total Option Price, (iii) subject to any conditions or limitations established
by the Committee, by the withholding of Common Shares otherwise issuable upon
exercise of an Option Right pursuant to a “net exercise” arrangement (it being
understood that, solely for purposes of determining the number of treasury
shares held by the Company, the Common Shares so withheld will not be treated as
issued and acquired by the Company upon such exercise), (iv) by a combination of
such methods of payment, or (v) by such other methods as may be approved by the
Committee.
(d)To the extent permitted by law, any grant may provide for deferred payment of
the Option Price from the proceeds of sale through a bank or broker on a date
satisfactory to the Company of some or all of the Common Shares to which such
exercise relates.
(e)Each grant will specify the period or periods of continuous service by the
Optionee with the Company or any Subsidiary, if any, that is necessary before
any Option Rights or installments thereof will vest. Option Rights may provide
for continued vesting or the earlier vesting of such Option Rights, including in
the event of the retirement, death, disability or termination of employment or
service of a Participant or in the event of a Change in Control.
(f)Any grant of Option Rights may specify Management Objectives regarding the
vesting of such rights.
(g)Option Rights granted under this Plan may be (i) options, including Incentive
Stock Options, that are intended to qualify under particular provisions of the
Code, (ii) options that are not intended to so qualify, or (iii) combinations of
the foregoing. Incentive Stock Options may only be granted to Participants who
meet the definition of “employees” under Section 3401(c) of the Code.
(h)No Option Right will be exercisable more than 10 years from the Date of
Grant. The Committee may provide in any Evidence of Award for the automatic
exercise of an Option Right upon such terms and conditions as established by the
Committee.
(i)Option Rights granted under this Plan may not provide for any dividends or
dividend equivalents thereon.
(j)Each grant of Option Rights will be evidenced by an Evidence of Award. Each
Evidence of Award will be subject to this Plan and will contain such terms and
provisions, consistent with this Plan, as the Committee may approve.
5.Appreciation Rights.
(a)The Committee may, from time to time and upon such terms and conditions as it
may determine, authorize the granting to any Participant of Appreciation Rights.
An Appreciation Right will be the right of the Participant to receive from the
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Exhibit 10.4
Company an amount determined by the Committee, which will be expressed as a
percentage of the Spread (not exceeding 100%) at the time of exercise.
(b)Each grant of Appreciation Rights may utilize any or all of the
authorizations, and will be subject to all of the requirements, contained in the
following provisions:
(i)Each grant may specify that the amount payable on exercise of an Appreciation
Right will be paid by the Company in cash, Common Shares or any combination
thereof.
(ii)Each grant will specify the period or periods of continuous service by the
Participant with the Company or any Subsidiary, if any, that is necessary before
the Appreciation Rights or installments thereof will vest. Appreciation Rights
may provide for continued vesting or the earlier vesting of such Appreciation
Rights, including in the event of the retirement, death, disability or
termination of employment or service of a Participant or in the event of a
Change in Control.
(iii)Any grant of Appreciation Rights may specify Management Objectives
regarding the vesting of such Appreciation Rights.
(iv)Appreciation Rights granted under this Plan may not provide for any
dividends or dividend equivalents thereon.
(v)Each grant of Appreciation Rights will be evidenced by an Evidence of Award.
Each Evidence of Award will be subject to this Plan and will contain such terms
and provisions, consistent with this Plan, as the Committee may approve.
(c)Also, regarding Appreciation Rights:
(i)Each grant will specify in respect of each Appreciation Right a Base Price,
which (except with respect to awards under Section 22 of this Plan) may not be
less than the Market Value per Share on the Date of Grant; and
(ii)No Appreciation Right granted under this Plan may be exercised more than 10
years from the Date of Grant. The Committee may provide in any Evidence of Award
for the automatic exercise of an Appreciation Right upon such terms and
conditions as established by the Committee.
6.Restricted Shares. The Committee may, from time to time and upon such terms
and conditions as it may determine, authorize the grant or sale of Restricted
Shares to Participants. Each such grant or sale may utilize any or all of the
authorizations, and will be subject to all of the requirements, contained in the
following provisions:
(a)Each such grant or sale will constitute an immediate transfer of the
ownership of Common Shares to the Participant in consideration of the
performance of services, entitling such Participant to voting, dividend and
other ownership rights (subject in particular to Section 6(g) of this Plan), but
subject to the substantial risk of forfeiture and restrictions on transfer
hereinafter described.
(b)Each such grant or sale may be made without additional consideration or in
consideration of a payment by such Participant that is less than the Market
Value per Share on the Date of Grant.
(c)Each such grant or sale will provide that the Restricted Shares covered by
such grant or sale will be subject to a “substantial risk of forfeiture” within
the meaning of Section 83 of the Code for a period to be determined by the
Committee on the Date of Grant or until achievement of Management Objectives
referred to in Section 6(e) of this Plan.
(d)Each such grant or sale will provide that during or after the period for
which such substantial risk of forfeiture is to continue, the transferability of
the Restricted Shares will be prohibited or restricted in the manner and to the
extent prescribed by the Committee on the Date of Grant (which restrictions may
include rights of repurchase or first refusal of the Company or provisions
subjecting the Restricted Shares to a continuing substantial risk of forfeiture
while held by any transferee).
(e)Any grant of Restricted Shares may specify Management Objectives regarding
the vesting of such Restricted Stock.
(f)Notwithstanding anything to the contrary contained in this Plan, Restricted
Shares may provide for continued vesting or the earlier vesting of such
Restricted Shares, including in the event of the retirement, death, disability
or termination of employment or service of a Participant or in the event of a
Change in Control.
(g)Any such grant or sale of Restricted Shares may require that any and all
dividends or other distributions paid thereon during the period of such
restrictions be automatically deferred and/or reinvested in additional
Restricted Shares, which will be subject to the same restrictions as the
underlying award. For the avoidance of doubt, any such dividends or other
distributions on Restricted Shares will be deferred until, and paid contingent
upon, the vesting of such Restricted Shares.
(h)Each grant or sale of Restricted Shares will be evidenced by an Evidence of
Award. Each Evidence of Award will be subject to this Plan and will contain such
terms and provisions, consistent with this Plan, as the Committee may approve.
Unless otherwise directed by the Committee, (i) all certificates representing
Restricted Shares will be held in custody by the Company until all restrictions
thereon will have lapsed, together with a stock power or powers executed by the
Participant in whose name such
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Exhibit 10.4
certificates are registered, endorsed in blank and covering such shares or
(ii) all Restricted Shares will be held at the Company’s transfer agent in book
entry form with appropriate restrictions relating to the transfer of such
Restricted Shares.
7.Restricted Stock Units. The Committee may, from time to time and upon such
terms and conditions as it may determine, authorize the granting or sale of
Restricted Stock Units to Participants. Each such grant or sale may utilize any
or all of the authorizations, and will be subject to all of the requirements,
contained in the following provisions:
(a)Each such grant or sale will constitute the agreement by the Company to
deliver Common Shares or cash, or a combination thereof, to the Participant in
the future in consideration of the performance of services, but subject to the
fulfillment of such conditions (which may include achievement regarding
Management Objectives) during the Restriction Period as the Committee may
specify.
(b)Each such grant or sale may be made without additional consideration or in
consideration of a payment by such Participant that is less than the Market
Value per Share on the Date of Grant.
(c)Notwithstanding anything to the contrary contained in this Plan, Restricted
Stock Units may provide for continued vesting or the earlier lapse or other
modification of the Restriction Period, including in the event of the
retirement, death, disability or termination of employment or service of a
Participant or in the event of a Change in Control.
(d)During the Restriction Period, the Participant will have no right to transfer
any rights under his or her award and will have no rights of ownership in the
Common Shares deliverable upon payment of the Restricted Stock Units and will
have no right to vote them, but the Committee may, at or after the Date of
Grant, authorize the payment of dividend equivalents on such Restricted Stock
Units on a deferred and contingent basis, either in cash or in additional Common
Shares; provided, however, that dividend equivalents or other distributions on
Common Shares underlying Restricted Stock Units shall be deferred until, and
paid contingent upon, the vesting of such Restricted Stock Units.
(e)Each grant or sale of Restricted Stock Units will specify the time and manner
of payment of the Restricted Stock Units that have been earned. Each grant or
sale will specify that the amount payable with respect thereto will be paid by
the Company in Common Shares or cash, or a combination thereof.
(f)Each grant or sale of Restricted Stock Units will be evidenced by an Evidence
of Award. Each Evidence of Award will be subject to this Plan and will contain
such terms and provisions, consistent with this Plan, as the Committee may
approve.
8.Cash Incentive Awards, Performance Shares and Performance Units. The Committee
may, from time to time and upon such terms and conditions as it may determine,
authorize the granting of Cash Incentive Awards, Performance Shares and
Performance Units. Each such grant may utilize any or all of the authorizations,
and will be subject to all of the requirements, contained in the following
provisions:
(a)Each grant will specify the number or amount of Performance Shares or
Performance Units, or amount payable with respect to a Cash Incentive Award, to
which it pertains, which number or amount may be subject to adjustment to
reflect changes in compensation or other factors.
(b)The Performance Period with respect to each Cash Incentive Award or grant of
Performance Shares or Performance Units will be such period of time as will be
determined by the Committee, which may be subject to continued vesting or
earlier lapse or other modification, including in the event of the retirement,
death, disability or termination of employment or service of a Participant or in
the event of a Change in Control.
(c)Each grant of a Cash Incentive Award, Performance Shares or Performance Units
will specify Management Objectives regarding the earning of the award.
(d)Each grant will specify the time and manner of payment of a Cash Incentive
Award, Performance Shares or Performance Units that have been earned.
(e)The Committee may, on the Date of Grant of Performance Shares or Performance
Units, provide for the payment of dividend equivalents to the holder thereof
either in cash or in additional Common Shares, which dividend equivalents will
be subject to deferral and payment on a contingent basis based on the
Participant’s earning and vesting of the Performance Shares or Performance
Units, as applicable, with respect to which such dividend equivalents are paid.
(f)Each grant of a Cash Incentive Award, Performance Shares or Performance Units
will be evidenced by an Evidence of Award. Each Evidence of Award will be
subject to this Plan and will contain such terms and provisions, consistent with
this Plan, as the Committee may approve.
9.Other Awards.
(a)Subject to applicable law and the applicable limits set forth in Section 3 of
this Plan, the Committee may authorize the grant to any Participant of Common
Shares or 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, Common
Shares or factors that may influence the value of such shares, including,
without limitation, convertible or exchangeable debt securities, other rights
convertible or exchangeable into Common Shares, purchase rights for Common
Shares, awards with value and payment contingent upon performance of the Company
or specified Subsidiaries, affiliates or other business units thereof or any
other factors designated by the Committee, and awards valued by reference to the
book value of the Common Shares or the value of securities of, or the
performance of specified Subsidiaries or affiliates or other
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Exhibit 10.4
business units of the Company. The Committee will determine the terms and
conditions of such awards. Common Shares delivered pursuant to an award in the
nature of a purchase right granted under this Section 9 will be purchased for
such consideration, paid for at such time, by such methods, and in such forms,
including, without limitation, Common Shares, other awards, notes or other
property, as the Committee determines.
(b)Cash awards, as an element of or supplement to any other award granted under
this Plan, may also be granted pursuant to this Section 9.
(c)The Committee may authorize the grant of Common Shares as a bonus, or may
authorize the grant of other awards in lieu of obligations of the Company or a
Subsidiary to pay cash or deliver other property under this Plan or under other
plans or compensatory arrangements, subject to such terms as will be determined
by the Committee in a manner that complies with Section 409A of the Code.
(d)The Committee may, at or after the Date of Grant, authorize the payment of
dividends or dividend equivalents on awards granted under this Section 9 on a
deferred and contingent basis, either in cash or in additional Common Shares,
based upon the earning and vesting of such awards.
(e)Each grant of an award under this Section 9 will be evidenced by an Evidence
of Award. Each such Evidence of Award will be subject to this Plan and will
contain such terms and provisions, consistent with this Plan, as the Committee
may approve, and will specify the time and terms of delivery of the applicable
award.
(f)Notwithstanding anything to the contrary contained in this Plan, awards under
this Section 9 may provide for the earning or vesting of, or earlier elimination
of restrictions applicable to, such award, including in the event of the
retirement, death, disability or termination of employment or service of a
Participant or in the event of a Change in Control.
10.Administration of this Plan.
(a)This Plan will be administered by the Committee; provided, however, that
notwithstanding anything in this Plan to the contrary, the Board may grant
awards under this Plan to non-employee Directors and administer this Plan with
respect to such awards. The Committee may from time to time delegate all or any
part of its authority under this Plan to a subcommittee thereof. To the extent
of any such delegation, references in this Plan to the Committee will be deemed
to be references to such subcommittee.
(b)The interpretation and construction by the Committee of any provision of this
Plan or of any Evidence of Award (or related documents) and any determination by
the Committee pursuant to any provision of this Plan or of any such agreement,
notification or document will be final and conclusive. No member of the
Committee shall be liable for any such action or determination made in good
faith. In addition, the Committee is authorized to take any action it determines
in its sole discretion to be appropriate subject only to the express limitations
contained in this Plan, and no authorization in any Plan section or other
provision of this Plan is intended or may be deemed to constitute a limitation
on the authority of the Committee.
(c)To the extent permitted by law, the Committee may delegate to one or more of
its members, to one or more officers of the Company, or to one or more agents or
advisors, such administrative duties or powers as it may deem advisable, and the
Committee, the subcommittee, or any person to whom duties or powers have been
delegated as aforesaid, may employ one or more persons to render advice with
respect to any responsibility the Committee, the subcommittee or such person may
have under this Plan. The Committee may, by resolution, authorize one or more
officers of the Company to do one or both of the following on the same basis as
the Committee: (i) designate employees to be recipients of awards under this
Plan; and (ii) determine the size of any such awards; provided, however, that
(A) the Committee will not delegate such responsibilities to any such officer
for awards granted to an employee who is an officer (for purposes of Section 16
of the Exchange Act), Director, or more than 10% “beneficial owner” (as such
term is defined in Rule 13d-3 promulgated under the Exchange Act) of any class
of the Company’s equity securities that is registered pursuant to Section 12 of
the Exchange Act, as determined by the Committee in accordance with Section 16
of the Exchange Act; (B) the resolution providing for such authorization shall
set forth the total number of Common Shares such officer(s) may grant; and (C)
the officer(s) will report periodically to the Committee regarding the nature
and scope of the awards granted pursuant to the authority delegated.
11.Adjustments. The Committee shall make or provide for such adjustments in the
number of and kind of Common Shares covered by outstanding Option Rights,
Appreciation Rights, Restricted Shares, Restricted Stock Units, Performance
Shares and Performance Units granted hereunder and, if applicable, in the number
of and kind of Common Shares covered by other awards granted pursuant to Section
9 of this Plan, in the Option Price and Base Price provided in outstanding
Option Rights and Appreciation Rights, respectively, in Cash Incentive Awards,
and in other award terms, as the Committee, in its sole discretion, exercised in
good faith, determines is equitably required to prevent dilution or enlargement
of the rights of Participants that otherwise would result from (a) any
extraordinary cash dividend, stock dividend, stock split, combination of shares,
recapitalization or other change in the capital structure of the Company,
(b) any merger, consolidation, spin-off, split-off, spin-out, split-up,
reorganization, partial or complete liquidation or other distribution of assets,
issuance of rights or warrants to purchase securities, or (c) any other
corporate transaction or event having an effect similar to any of the foregoing.
Moreover, in the event of any such transaction or event or in the event of a
Change in Control, the Committee may provide in substitution for any or all
outstanding awards under this Plan such alternative consideration (including
cash), if any, as it, in good faith, may determine to be equitable in the
circumstances and shall require in connection therewith the surrender of all
awards so replaced in a manner that complies with Section 409A of the Code. In
addition, for each Option Right or Appreciation
7

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Exhibit 10.4
Right with an Option Price or Base Price, respectively, greater than the
consideration offered in connection with any such transaction or event or Change
in Control, the Committee may in its discretion elect to cancel such Option
Right or Appreciation Right without any payment to the person holding such
Option Right or Appreciation Right. The Committee shall also make or provide for
such adjustments in the number of Common Shares specified in Section 3 of this
Plan as the Committee in its sole discretion, exercised in good faith,
determines is appropriate to reflect any transaction or event described in this
Section 11; provided, however, that any such adjustment to the number specified
in Section 3(c) of this Plan will be made only if and to the extent that such
adjustment would not cause any Option Right intended to qualify as an Incentive
Stock Option to fail to so qualify.
12.Change in Control. For purposes of this Plan, except as may be otherwise
prescribed by the Committee in an Evidence of Award made under this Plan, a
“Change in Control” will be deemed to have occurred upon the occurrence (after
the Effective Date) of any of the following events:
(a)any individual, entity or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Exchange Act) (a “Person”) becomes the beneficial owner (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) of 35% or more of
either (i) the then-outstanding Common Shares (the “Outstanding Company Common
Stock”) or (ii) the combined voting power of the then-outstanding voting
securities of the Company entitled to vote generally in the election of
directors (the “Outstanding Company Voting Securities”); provided, however,
that, for purposes of this definition, the following acquisitions shall not
constitute a Change in Control: (A) any acquisition directly from the Company,
(B) any acquisition by the Company, (C) any acquisition by any employee benefit
plan (or related trust) sponsored or maintained by the Company or any affiliate
or (D) any acquisition pursuant to a transaction that complies with Sections
12(c)(i), (c)(ii) and (c)(iii) below;
(b)individuals who, as of the Effective Date, constitute the Board (the
“Incumbent Board”) cease for any reason to constitute at least a majority of the
Board; provided, however, that any individual becoming a director subsequent to
the Effective Date whose election, or nomination for election by the
Shareholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board (either by specific vote or by approval of
the proxy statement of the Company in which such individual is named as a
nominee for director, without objection to such nomination) shall be considered
as though such individual was a member of the Incumbent Board, but excluding,
for this purpose, any such individual whose initial assumption of office occurs
as a result of an actual or threatened election contest with respect to the
election or removal of directors or other actual or threatened solicitation of
proxies or consents by or on behalf of a Person other than the Board;
(c)consummation of a reorganization, merger, statutory share exchange or
consolidation or similar transaction involving the Company or any of its
subsidiaries, a sale or other disposition of all or substantially all of the
assets of the Company, or the acquisition of assets or securities of another
entity by the Company or any of its subsidiaries (each, a “Business
Combination”), in each case unless, following such Business Combination, (i) all
or substantially all of the individuals and entities that were the beneficial
owners of the Outstanding Company Common Stock and the Outstanding Company
Voting Securities immediately prior to such Business Combination beneficially
own, directly or indirectly, more than 50% of the then-outstanding shares of
common stock (or, for a non-corporate entity, equivalent securities) and the
combined voting power of the then-outstanding voting securities entitled to vote
generally in the election of directors (or, for a non-corporate entity,
equivalent governing body), as the case may be, of the entity resulting from
such Business Combination (including, without limitation, an entity that, as a
result of such transaction, owns the Company or all or substantially all of the
Company’s assets either directly or through one or more subsidiaries) in
substantially the same proportions as their ownership immediately prior to such
Business Combination of the Outstanding Company Common Stock and the Outstanding
Company Voting Securities, as the case may be, (ii) no Person (excluding any
entity resulting from such Business Combination or any employee benefit plan (or
related trust) of the Company or such entity resulting from such Business
Combination) beneficially owns, directly or indirectly, 35% or more of,
respectively, the then-outstanding shares of common stock (or, for a
non-corporate entity, equivalent securities) of the entity resulting from such
Business Combination or the combined voting power of the then-outstanding voting
securities of such entity, except to the extent that such ownership existed
prior to the Business Combination, and (iii) at least a majority of the members
of the board of directors (or, for a non-corporate entity, equivalent governing
body) of the entity resulting from such Business Combination were members of the
Incumbent Board at the time of the execution of the initial agreement or of the
action of the Board providing for such Business Combination; or
(d)approval by the Shareholders of a complete liquidation or dissolution of the
Company.
13.Detrimental Activity and Recapture Provisions. Any Evidence of Award may
reference a clawback policy of the Company or provide for the cancellation or
forfeiture of an award or the forfeiture and repayment to the Company of any
gain related to an award, or other provisions intended to have a similar effect,
upon such terms and conditions as may be determined by the Committee from time
to time, if a Participant, either (a) during employment or other service with
the Company or a Subsidiary or (b) within a specified period after termination
of such employment or service, engages in any detrimental activity, as described
in the applicable Evidence of Award or such clawback policy. In addition,
notwithstanding anything in this Plan to the contrary, any Evidence of Award or
such clawback policy may also provide for the cancellation or forfeiture of an
award or the forfeiture and repayment to the Company of any Common Stock issued
under and/or any other benefit related to an award, or other provisions intended
to have a similar effect, including upon such terms and conditions as may be
required by the Committee or under Section 10D of the Exchange Act and any
8

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Exhibit 10.4
applicable rules or regulations promulgated by the Securities and Exchange
Commission or any national securities exchange or national securities
association on which the Common Shares may be traded.
14.Non U.S. Participants. In order to facilitate the making of any grant or
combination of grants under this Plan, the Committee may provide for such
special terms for awards to Participants who are foreign nationals or who are
employed by the Company or any Subsidiary outside of the United States of
America or who provide services to the Company under an agreement with a foreign
nation or agency, as the Committee may consider necessary or appropriate to
accommodate differences in local law, tax policy or custom. Moreover, the
Committee may approve such supplements to or amendments, restatements or
alternative versions of this Plan (including sub-plans) (to be considered part
of this Plan) as it may consider necessary or appropriate for such purposes,
without thereby affecting the terms of this Plan as in effect for any other
purpose, and the Secretary or other appropriate officer of the Company may
certify any such document as having been approved and adopted in the same manner
as this Plan. No such special terms, supplements, amendments or restatements,
however, will include any provisions that are inconsistent with the terms of
this Plan as then in effect unless this Plan could have been amended to
eliminate such inconsistency without further approval by the Shareholders.
15.Transferability.
(a)Except as otherwise determined by the Committee, and subject to compliance
with Section 17(b) of this Plan and Section 409A of the Code, no Option Right,
Appreciation Right, Restricted Shares, Restricted Stock Unit, Performance Share,
Performance Unit, Cash Incentive Award, award contemplated by Section 9 of this
Plan or dividend equivalents paid with respect to awards made under this Plan
will be transferable by the Participant except by will or the laws of descent
and distribution. In no event will any such award granted under this Plan be
transferred for value. Where transfer is permitted, references to “Participant”
shall be construed, as the Committee deems appropriate, to include any permitted
transferee to whom such award is transferred. Except as otherwise determined by
the Committee, Option Rights and Appreciation Rights will be exercisable during
the Participant’s lifetime only by him or her or, in the event of the
Participant’s legal incapacity to do so, by his or her guardian or legal
representative acting on behalf of the Participant in a fiduciary capacity under
state law or court supervision.
(b)The Committee may specify on the Date of Grant that part or all of the Common
Shares that are (i) to be issued or transferred by the Company upon the exercise
of Option Rights or Appreciation Rights, upon the termination of the Restriction
Period applicable to Restricted Stock Units or upon payment under any grant of
Performance Shares or Performance Units or (ii) no longer subject to the
substantial risk of forfeiture and restrictions on transfer referred to in
Section 6 of this Plan, will be subject to further restrictions on transfer,
including minimum holding periods.
16.Withholding Taxes. To the extent that the Company is required to withhold
federal, state, local or foreign taxes or other amounts in connection with any
payment made or benefit realized by a Participant or other person under this
Plan, and the amounts available to the Company for such withholding are
insufficient, it will be a condition to the receipt of such payment or the
realization of such benefit that the Participant or such other person make
arrangements satisfactory to the Company for payment of the balance of such
taxes or other amounts required to be withheld, which arrangements (in the
discretion of the Committee) may include relinquishment of a portion of such
benefit. If a Participant’s benefit is to be received in the form of Common
Shares, and such Participant fails to make arrangements for the payment of taxes
or other amounts, then, unless otherwise determined by the Committee, the
Company will withhold Common Shares having a value equal to the amount required
to be withheld. Notwithstanding the foregoing, when a Participant is required to
pay the Company an amount required to be withheld under applicable income,
employment, tax or other laws, the Participant may elect, unless otherwise
determined by the Committee, to satisfy the obligation, in whole or in part, by
having withheld, from the Common Shares required to be delivered to the
Participant, Common Shares having a value equal to the amount required to be
withheld or by delivering to the Company other Common Shares held by such
Participant. The Common Shares used for tax or other withholding will be valued
at an amount equal to the fair market value of such Common Shares on the date
the benefit is to be included in Participant’s income. In no event will the fair
market value of the Common Shares to be withheld and delivered pursuant to this
Section 16 exceed the minimum amount required to be withheld, unless (i) an
additional amount can be withheld and not result in adverse accounting
consequences, and (ii) such additional withholding amount is authorized by the
Committee. Participants will also make such arrangements as the Company may
require for the payment of any withholding tax or other obligation that may
arise in connection with the disposition of Common Shares acquired upon the
exercise of Option Rights.
17.Compliance with Section 409A of the Code.
(a)To the extent applicable, it is intended that this Plan and any grants made
hereunder comply with the provisions of Section 409A of the Code, so that the
income inclusion provisions of Section 409A(a)(1) of the Code do not apply to
the Participants. This Plan and any grants made hereunder will be administered
in a manner consistent with this intent. Any reference in this Plan to
Section 409A of the Code will also include any regulations or any other formal
guidance promulgated with respect to such section by the U.S. Department of the
Treasury or the Internal Revenue Service.
(b)Neither a Participant nor any of a Participant’s creditors or beneficiaries
will have the right to subject any deferred compensation (within the meaning of
Section 409A of the Code) payable under this Plan and grants hereunder to any
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment or garnishment. Except as permitted under Section 409A of the Code,
any deferred compensation (within the meaning of Section 409A of the Code)
payable to a Participant or for a
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Exhibit 10.4
Participant’s benefit under this Plan and grants hereunder may not be reduced
by, or offset against, any amount owed by a Participant to the Company or any of
its Subsidiaries.
(c)If, at the time of a Participant’s separation from service (within the
meaning of Section 409A of the Code), (i) the Participant will be a specified
employee (within the meaning of Section 409A of the Code and using the
identification methodology selected by the Company from time to time) and
(ii) the Company makes a good faith determination that an amount payable
hereunder constitutes deferred compensation (within the meaning of Section 409A
of the Code) the payment of which is required to be delayed pursuant to the
six-month delay rule set forth in Section 409A of the Code in order to avoid
taxes or penalties under Section 409A of the Code, then the Company will not pay
such amount on the otherwise scheduled payment date but will instead pay it,
without interest, on the fifth business day of the seventh month after such
separation from service.
(d)Solely with respect to any award that constitutes nonqualified deferred
compensation subject to Section 409A of the Code and that is payable on account
of a Change in Control (including any installments or stream of payments that
are accelerated on account of a Change in Control), a Change in Control shall
occur only if such event also constitutes a “change in the ownership,” “change
in effective control,” and/or a “change in the ownership of a substantial
portion of assets” of the Company as those terms are defined under Treasury
Regulation §1.409A-3(i)(5), but only to the extent necessary to establish a time
and form of payment that complies with Section 409A of the Code, without
altering the definition of Change in Control for any purpose in respect of such
award.
(e)Notwithstanding any provision of this Plan and grants hereunder to the
contrary, in light of the uncertainty with respect to the proper application of
Section 409A of the Code, the Company reserves the right to make amendments to
this Plan and grants hereunder as the Company deems necessary or desirable to
avoid the imposition of taxes or penalties under Section 409A of the Code. In
any case, a Participant will be solely responsible and liable for the
satisfaction of all taxes and penalties that may be imposed on a Participant or
for a Participant’s account in connection with this Plan and grants hereunder
(including any taxes and penalties under Section 409A of the Code), and neither
the Company nor any of its affiliates will have any obligation to indemnify or
otherwise hold a Participant harmless from any or all of such taxes or
penalties.
18.Amendments.
(a)The Board may at any time and from time to time amend this Plan in whole or
in part; provided, however, that if an amendment to this Plan, for purposes of
applicable stock exchange rules and except as permitted under Section 11 of this
Plan, (i) would materially increase the benefits accruing to Participants under
this Plan, (ii) would materially increase the number of securities which may be
issued under this Plan, (iii) would materially modify the requirements for
participation in this Plan, or (iv) must otherwise be approved by the
Shareholders in order to comply with applicable law or the rules of the New York
Stock Exchange or, if the Common Shares are not traded on the New York Stock
Exchange, the principal national securities exchange upon which the Common
Shares are traded or quoted, all as determined by the Board, then, such
amendment will be subject to Shareholder approval and will not be effective
unless and until such approval has been obtained.
(b)Except in connection with a corporate transaction or event described in
Section 11 of this Plan or in connection with a Change in Control, the terms of
outstanding awards may not be amended to reduce the Option Price of outstanding
Option Rights or the Base Price of outstanding Appreciation Rights, or cancel
outstanding “underwater” Option Rights or Appreciation Rights (including
following a Participant’s voluntary surrender of “underwater” Option Rights or
Appreciation Rights) in exchange for cash, other awards or Option Rights or
Appreciation Rights with an Option Price or Base Price, as applicable, that is
less than the Option Price of the original Option Rights or Base Price of the
original Appreciation Rights, as applicable, without Shareholder approval. This
Section 18(b) is intended to prohibit the repricing of “underwater” Option
Rights and Appreciation Rights and will not be construed to prohibit the
adjustments provided for in Section 11 of this Plan. Notwithstanding any
provision of this Plan to the contrary, this Section 18(b) may not be amended
without approval by the Shareholders.
(c)If permitted by Section 409A of the Code, but subject to the paragraph that
follows, including in the case of termination of employment or service, or in
the case of unforeseeable emergency or other circumstances or in the event of a
Change in Control, to the extent a Participant holds an Option Right or
Appreciation Right not immediately exercisable in full, or any Restricted Shares
as to which the substantial risk of forfeiture or the prohibition or restriction
on transfer has not lapsed, or any Restricted Stock Units as to which the
Restriction Period has not been completed, or any Cash Incentive Awards,
Performance Shares or Performance Units which have not been fully earned, or any
dividend equivalents or other awards made pursuant to Section 9 of this Plan
subject to any vesting schedule or transfer restriction, or who holds Common
Shares subject to any transfer restriction imposed pursuant to Section 15(b) of
this Plan, the Committee may, in its sole discretion, provide for continued
vesting or accelerate the time at which such Option Right, Appreciation Right or
other award may vest or be exercised or the time at which such substantial risk
of forfeiture or prohibition or restriction on transfer will lapse or the time
when such Restriction Period will end or the time at which such Cash Incentive
Awards, Performance Shares or Performance Units will be deemed to have been
earned or the time when such transfer restriction will terminate or may waive
any other limitation or requirement under any such award.
(d)Subject to Section 18(b) of this Plan, the Committee may amend the terms of
any award theretofore granted under this Plan prospectively or retroactively.
Except for adjustments made pursuant to Section 11 of this Plan, no such
amendment will materially impair the rights of any Participant without his or
her consent. The Board may, in its discretion, terminate
10

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Exhibit 10.4
this Plan at any time. Termination of this Plan will not affect the rights of
Participants or their successors under any awards outstanding hereunder and not
exercised in full on the date of termination.
19.Governing Law. This Plan and all grants and awards and actions taken
hereunder will be governed by and construed in accordance with the internal
substantive laws of the State of Delaware.
20.Effective Date/Termination. This Plan will be effective as of the Effective
Date. No grants will be made on or after the Effective Date under the
Predecessor Plan, provided that outstanding awards granted under the Predecessor
Plan will continue unaffected following the Effective Date. No grant will be
made under this Plan on or after the tenth anniversary of the Effective Date,
but all grants made prior to such date will continue in effect thereafter
subject to the terms thereof and of this Plan. For clarification purposes, the
terms and conditions of this Plan shall not apply to or otherwise impact
previously granted and outstanding awards under the Predecessor Plans, as
applicable.
21.Miscellaneous Provisions.
(a)The Company will not be required to issue any fractional Common Shares
pursuant to this Plan. The Committee may provide for the elimination of
fractions or for the settlement of fractions in cash.
(b)This Plan will not confer upon any Participant any right with respect to
continuance of employment or other service with the Company or any Subsidiary,
nor will it interfere in any way with any right the Company or any Subsidiary
would otherwise have to terminate such Participant’s employment or other service
at any time.
(c)Except with respect to Section 21(e) of this Plan, to the extent that any
provision of this Plan would prevent any Option Right that was intended to
qualify as an Incentive Stock Option from qualifying as such, that provision
will be null and void with respect to such Option Right. Such provision,
however, will remain in effect for other Option Rights and there will be no
further effect on any provision of this Plan.
(d)No award under this Plan may be exercised by the holder thereof if such
exercise, and the receipt of cash or shares thereunder, would be, in the opinion
of counsel selected by the Company, contrary to law or the regulations of any
duly constituted authority having jurisdiction over this Plan.
(e)Absence on leave approved by a duly constituted officer of the Company or any
of its Subsidiaries will not be considered interruption or termination of
service of any employee for any purposes of this Plan or awards granted
hereunder.
(f)No Participant will have any rights as a Shareholder with respect to any
Common Shares subject to awards granted to him or her under this Plan prior to
the date as of which he or she is actually recorded as the holder of such Common
Shares upon the share records of the Company.
(g)The Committee may condition the grant of any award or combination of awards
authorized under this Plan on the surrender or deferral by the Participant of
his or her right to receive a cash bonus or other compensation otherwise payable
by the Company or a Subsidiary to the Participant.
(h)Except with respect to Option Rights and Appreciation Rights, the Committee
may permit Participants to elect to defer the issuance of Common Shares under
this Plan pursuant to such rules, procedures or programs as it may establish for
purposes of this Plan and which are intended to comply with the requirements of
Section 409A of the Code. The Committee also may provide that deferred issuances
and settlements include the crediting of dividend equivalents or interest on the
deferral amounts.
(i)If any provision of this Plan is or becomes invalid or unenforceable in any
jurisdiction, or would disqualify this Plan or any award under any law deemed
applicable by the Committee, such provision will be construed or deemed amended
or limited in scope to conform to applicable laws or, in the discretion of the
Committee, it will be stricken and the remainder of this Plan will remain in
full force and effect. Notwithstanding anything in this Plan or an Evidence of
Award to the contrary, nothing in this Plan or in an Evidence of Award prevents
a Participant from providing, without prior notice to the Company, information
to governmental authorities regarding possible legal violations or otherwise
testifying or participating in any investigation or proceeding by any
governmental authorities regarding possible legal violations, and for purpose of
clarity a Participant is not prohibited from providing information voluntarily
to the Securities and Exchange Commission pursuant to Section 21F of the
Exchange Act.
22.Share-Based Awards in Substitution for Awards Granted by Another Company.
Notwithstanding anything in this Plan to the contrary:
(a)Awards may be granted under this Plan in substitution for or in conversion
of, or in connection with an assumption of, stock options, stock appreciation
rights, restricted stock, restricted stock units or other share or share-based
awards held by awardees of an entity engaging in a corporate acquisition or
merger transaction with the Company or any Subsidiary. Any conversion,
substitution or assumption will be effective as of the close of the merger or
acquisition, and, to the extent applicable, will be conducted in a manner that
complies with Section 409A of the Code. The awards so granted may reflect the
original terms of the awards being assumed or substituted or converted for and
need not comply with other specific terms of this Plan, and may account for
Common Shares substituted for the securities covered by the original awards and
the number of shares subject to the original awards, as well as any exercise or
purchase prices applicable to the original awards, adjusted to account for
differences in stock prices in connection with the transaction.
(b)In the event that a company acquired by the Company or any Subsidiary or with
which the Company or any Subsidiary merges has shares available under a
pre-existing plan previously approved by stockholders and not adopted in
11

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Exhibit 10.4
contemplation of such acquisition or merger, the shares available for grant
pursuant to the terms of such plan (as adjusted, to the extent appropriate, to
reflect such acquisition or merger) may be used for awards made after such
acquisition or merger under this Plan; provided, however, that awards using such
available shares may not be made after the date awards or grants could have been
made under the terms of the pre-existing plan absent the acquisition or merger,
and may only be made to individuals who were not employees or directors of the
Company or any Subsidiary prior to such acquisition or merger.
(c)Any Common Shares that are issued or transferred by, or that are subject to
any awards that are granted by, or become obligations of, the Company under
Sections 22(a) or 22(b) of this Plan will not reduce the Common Shares available
for issuance or transfer under this Plan or otherwise count against the limits
contained in Section 3 of this Plan. In addition, no Common Shares subject to an
award that is granted by, or becomes an obligation of, the Company under
Sections 22(a) or 22(b) of this Plan, will be added to the aggregate limit
contained in Section 3(a)(i) of this Plan.
12