ARCH COAL, INC.
1997 STOCK INCENTIVE PLAN
(As Amended and Restated on October 21, 2010)
SECTION 1
Statement of Purpose

1.1.   The Arch Coal, Inc. 1997 Stock Incentive Plan (the “Plan”) has been
established by Arch Coal, Inc. in order to:

  (a)   attract and retain executive, managerial and other salaried employees,
as well as non-employee Directors;     (b)   motivate Participants, by means of
appropriate incentives, to achieve long-range goals;     (c)   provide incentive
compensation opportunities that are competitive with those of other major
corporations; and     (d)   further identify a Participant’s interests with
those of the Company’s other stockholders through compensation based on the
Company’s common stock; thereby promoting the long-term financial interest of
the Company and its Related Companies, including the growth in value of the
Company’s equity and enhancement of long-term stockholder return.

SECTION 2
Definitions

2.1.   Unless the context indicates otherwise, the following terms shall have
the meaning set forth below:

  (a)   Acquiring Corporation. The term “Acquiring Corporation” shall mean the
surviving, continuing successor or purchasing corporation in an acquisition or
merger with the Company in which the Company is not the surviving corporation.  
  (b)   Award. The term “Award” shall mean any award or benefit granted to any
Participant under the Plan, including, without limitation, the grant of Options,
Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance
Stock, Performance Units, Merit Awards, Phantom Stock Awards and Stock acquired
through purchase under Section 12.     (c)   Award Agreement. The term “Award
Agreement” shall mean any written agreement, contract, or other instrument or
document evidencing any Award, which shall not become effective until executed
or acknowledged by a Participant.     (d)   Board. The term “Board” shall mean
the Board of Directors of the Company acting as such but shall not include the
Committee or other committees of the Board acting on behalf of the Board.    
(e)   Cause. The term “Cause” shall mean (a) the continued failure by the
Participant to substantially perform his or her duties with the Company (other
than any such failure resulting from his or her incapacity due to physical or
mental illness), or (b) the engaging by the Participant in conduct which is
demonstrably and materially injurious to the Company, monetarily or otherwise.  
  (f)   Change in Control. A “Change in Control” shall be deemed to have
occurred upon any of the following events: (1) consummation of any consolidation
or merger of the Company in which the Company is not the continuing or surviving
corporation or pursuant to which shares of Stock would be converted into cash,
securities or other property, other than a merger in which the holders of the
Stock immediately prior to the merger will have more than 50% of the ownership
of

 

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      common stock of the surviving corporation immediately after the merger,
(2) any sale, lease, exchange or other transfer (in one transaction or a series
of related transactions) of all or substantially all of the assets of the
Company, (3) adoption of any plan or proposal for the liquidation or dissolution
of the Company, or (4) when any “person” (as defined in Section 13(d) of the
Exchange Act), other than a Significant Stockholder, or any subsidiary of the
Company or employee benefit plan or trust maintained by the Company or any of
its subsidiaries, shall become the “beneficial owner” (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of more than 20% of the Stock
outstanding at the time, without the prior approval of the Board.

  (g)   Code. The term “Code” means the Internal Revenue Code of 1986, as
amended. A reference to any provision of the Code shall include reference to any
successor provision of the Code.     (h)   Committee. The term “Committee” means
the Personnel & Compensation Committee of the Board.     (i)   Company. The term
“Company” means Arch Coal, Inc., a Delaware corporation.     (j)   Date of
Termination. A Participant’s “Date of Termination” shall be the date on which
his or her employment or service with all Employer and Related Companies
terminates for any reason; provided that, for purposes of this Plan only, a
Participant’s employment or service shall not be considered terminated by reason
of the Participant’s leave of absence from an Employer or a Related Company that
is approved in advance by the Participant’s Employer. Notwithstanding the above,
to the extent any Award constitutes nonqualified deferred compensation which is
subject to the limitations and restrictions of Code Section 409A, a
Participant’s “Date of Termination” shall be the date he or she has a separation
from service as determined in accordance with the rules promulgated under Code
Section 409A and the resolutions of the Board regarding such determination.    
(k)   De Minimus Awards. The term “De Minimus Awards” shall mean, collectively,
one or more Awards pursuant to which an aggregate of up to 5.0% of the total
number of shares of Stock available for grants of Awards may be issued.     (l)
  Director. The term “Director” shall mean a member of the Board of Directors of
the Employer.     (m)   Disability. Except as otherwise provided by the
Committee, a Participant shall be considered to have a “Disability” during the
period in which he or she is unable, by reason of a medically determined
physical or mental impairment, to carry out his or her duties with an Employer,
which condition, in the discretion of the Committee, shall generally be an event
which qualifies as a “long term disability” under applicable long term
disability benefit programs of the Company.     (n)   Employee. The term
“Employee” shall mean a person with an employment relationship with an Employer.
    (o)   Employer. The Company and each Subsidiary which, with the consent of
the Company, participates in the Plan for the benefit of its eligible Employees
and Directors are referred to collectively as the “Employers” and individually
as an “Employer”.     (p)   Exchange Act. The term “Exchange Act” means the
Securities Exchange Act of 1934, as amended.     (q)   Exercise Price. The term
“Exercise Price” means (1) with respect to each share of Stock subject to an
Option, the price fixed by the Committee in the applicable Award Agreement at
which such share may be purchased from the Company pursuant to the exercise of
such Option, which price at no time may be less than 100% of the Fair Market
Value of the Stock on the date the Option is granted, except as permitted and
contemplated by Section 21 of the Plan, and (2) with respect to

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      each share of Stock subject to a Stock Appreciation Right, the price as
specified in accordance with Section 7.1(b) of the Plan.

  (r)   Fair Market Value. The “Fair Market Value” of the Stock on any given
date shall be the last sale price, regular way, or, in case no such sale takes
place on such date, the average of the closing bid and asked prices, regular
way, of the Stock, in either case as reported in the principal consolidated
transaction reporting system with respect to securities listed or admitted to
trading on the NYSE or, if the Stock is not listed or admitted to trading on the
NYSE, as reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the Stock is listed or admitted to trading or, if the Stock is not
listed or admitted to trading on any national securities exchange, the last
quoted sale price on such date or, if not so quoted, the average of the high bid
and low asked prices in the over-the-counter market on such date, as reported by
the National Association of Securities Dealers, Inc. Automated Quotations System
or such other system then in use, or, if on any such date the Stock is not
quoted by any such organization, the average of the closing bid and asked prices
on such date as furnished by a professional market maker making a market in the
Stock. If the Stock is not publicly held or so listed or publicly traded, “Fair
Market Value” per share of Stock shall mean the Fair Market Value per share as
reasonably determined by the Committee.     (s)   Full Value Award. The term
“Full Value Award” shall mean any Award the net value of which to the
Participant is equal to the aggregate Fair Market Value of the total number of
shares of Stock subject to the Award.     (t)   Immediate Family. With respect
to a particular Participant, the term “Immediate Family” shall mean, whether
through consanguinity or adoptive relationships, the Participant’s spouse,
children, stepchildren, siblings and grandchildren.     (u)   Incentive Stock
Option. The term “Incentive Stock Option” shall mean any Incentive Stock Option
granted under the Plan.     (v)   Merit Award. The term “Merit Award” shall mean
any performance-based Award granted under Section 10 or Section 11 of the Plan
or any other performance-based Award other than Incentive Stock Options,
Non-Qualified Stock Options, Restricted Stock, Restricted Stock Units, or Stock
Appreciation Rights.     (w)   Non-Employee Director. The term “Non-Employee
Director” shall mean a person who qualifies as such under Rule 16b-3(b)(3) under
the Exchange Act or any successor provision, and who also qualifies as an
“outside director” under Section 162(m) of the Code.     (x)   Non-Qualified
Stock Option. The term “Non-qualified Stock Option” shall mean any Non-Qualified
Stock Option granted under the Plan.     (y)   NYSE. The term “NYSE” refers to
the New York Stock Exchange, Inc.     (z)   Option. The term “Option” shall mean
any Incentive Stock Option or Non-Qualified Stock Option granted under the Plan.
    (aa)   Participant. The term “Participant” means an Employee or Director who
has been granted an award under the Plan.     (bb)   Performance-Based
Compensation. The term “Performance-Based Compensation” shall have the meaning
ascribed to it in Section 162(m)(4)(C) of the Code.     (cc)   Performance
Goals. The term “Performance Goals” means the goals established by the Committee
under an Award which, if met, will entitle the Participant to payment under such

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      Award and will qualify such payment as “Performance-Based Compensation” as
that term is used in Code Section 162(m)(4)(C). Such goals will be based upon
such specified levels of achievement as the Committee may from time to time
determine with respect to one or more of the following: operating income; net
income; debt reduction; earnings per share; cash flow; cost reduction; earnings
before interest, taxes, depreciation and amortization (EBITDA); environmental
compliance; safety performance; production rates; operating cost per ton; total
shareholder return; financial return measures; provided, any one of which may be
measured with respect to the Company or any one or more of its Subsidiaries and
divisions and either in absolute terms or as compared to another company or
companies, or an index established or designed by the Committee.

  (dd)   Performance Period. The term “Performance Period” shall mean the period
over which applicable performance is to be measured.     (ee)   Performance
Stock. The term “Performance Stock” shall have the meaning ascribed to it in
Section 10 of the Plan.     (ff)   Performance Units. The term “Performance
Units” shall have the meaning ascribed to it in Section 11 of the Plan.     (gg)
  Phantom Stock Award. The term “Phantom Stock Award” shall mean any Phantom
Stock Award granted under the Plan.     (hh)   Plan. The term “Plan” shall mean
this Arch Coal, Inc. 1997 Stock Incentive Plan as the same may be from time to
time amended or revised.     (ii)   Related Companies. The term “Related
Companies’ means any Significant Stockholder and their subsidiaries; and any
other company during any period in which it is a Subsidiary or a division of the
Company, including any entity acquired by, or merged with or into, the Company
or a Subsidiary.     (jj)   Restricted Period. The term “Restricted Period”
shall mean the period of time for which shares of Restricted Stock or Restricted
Stock Units are subject to forfeiture pursuant to the Plan or during which
Options and Stock Appreciation Rights are not exercisable.     (kk)   Restricted
Stock. The term “Restricted Stock” shall have the meaning ascribed to it in
Section 8 of the Plan.     (ll)   Restricted Stock Units. The term “Restricted
Stock Units” shall have the meaning ascribed to it in Section 9 of the Plan.    
(mm)   Retirement. “Retirement” of a Participant shall occur when a
Participant’s Date of Termination occurs on or after the date on which the
Participant attains age 55 and such Participant has not been terminated for
Cause.     (nn)   SEC. “SEC” means the Securities and Exchange Commission.    
(oo)   Significant Stockholder. The term “Significant Stockholder” shall mean
any shareholder of the Company who, immediately prior to the Effective Date,
owned more than 5% of the common stock of the Company.     (pp)   Stock. The
term “Stock” shall mean shares of common stock, $.01 par value per share, of the
Company.

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  (qq)   Stock Appreciation Rights. The term “Stock Appreciation Rights” shall
mean any Stock Appreciation Right granted under the Plan.     (rr)   Subsidiary.
The term “Subsidiary” shall mean any present or future subsidiary corporation of
the Company within the meaning of Code Section 424(f).     (ss)   Tax Date. The
term “Tax Date” shall mean the date a withholding tax obligation arises with
respect to an Award.

SECTION 3
Eligibility

3.1.   Subject to the discretion of the Committee and the terms and conditions
of the Plan, the Committee shall determine and designate from time to time, the
Employees, Directors or other persons as contemplated by Section 21 of the Plan
who will be granted one or more Awards under the Plan.

SECTION 4
Operation and Administration

4.1.   The Plan, as amended and restated herein, has been adopted by the Board
to be effective as of January 1, 2010, subject to approval by the shareholders
of the Company. To the extent required pursuant to Section 162(m) of the Code,
the Plan shall be resubmitted to shareholders for reapproval no later than at
the first shareholders’ meeting that occurs during the fifth year following the
year of the initial approval and thereafter at five year intervals, in each
case, as may be required to qualify any Award hereunder as Performance-Based
Compensation. The Plan shall be unlimited in duration and remain in effect until
termination by the Board; provided however, that no Incentive Stock Option may
be granted under the Plan after January 1, 2020.   4.2.   Plenary authority to
administer, manage and control the operation and administration of the Plan
shall be vested in the Committee, which authority shall include, but shall not
be limited to:

  (a)   Subject to the provisions of the Plan, the authority and discretion to
select Employees and Directors to receive Awards, to determine the time or times
of receipt, to determine the types of Awards and the number of shares covered by
the Awards, to establish the terms, conditions, performance criteria,
restrictions, and other provisions of such Awards. In making such Award
determinations, the Committee may take into account the nature of services
rendered by the respective Employee or Director, his or her present and
potential contribution to the Company’s success and such other factors as the
Committee deems relevant.     (b)   Subject to the provisions of the Plan, the
authority and discretion to determine the extent to which Awards under the Plan
will be structured to conform to the requirements applicable to
Performance-Based Compensation as described in Code Section 162(m), and to take
such action, establish such procedures, and impose such restrictions at the time
such awards are granted as the Committee determines to be necessary or
appropriate to conform to such requirements.     (c)   The authority and
discretion to interpret the Plan and the Awards granted under the Plan, to
establish, amend and rescind any rules and regulations relating to the Plan, to
determine the terms and provisions of any agreements made pursuant to the Plan,
to make all other determinations that it deems necessary or advisable for the
administration of the Plan and to correct any defect or supply any omission or
reconcile any inconsistency in the Plan or in any Award, in each case, in the
manner and to the extent the Committee deems necessary or advisable to carry it
into effect.

4.3.   Any interpretation of the Plan by the Committee and any decision made by
it under the Plan shall be final and binding on all persons. The express grant
in the Plan of any specific power to the Committee shall not be construed as
limiting any power or authority of the Committee. Provided, however, that except
as

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    otherwise permitted under Treasury Regulation 1.162-27(e)(2)(iii)(C), the
Committee may not increase any Award once made if payment under such Award is
intended to constitute Performance-Based Compensation.

4.4.   The Committee may only act at a meeting by unanimous consent if comprised
of two members, and otherwise by a majority of its members. Any determination of
the Committee may be made without a meeting by the unanimous written consent of
its members. In addition, the Committee may authorize one or more of its members
or any officer of an Employer to execute and deliver documents and perform other
administrative acts pursuant to the Plan.   4.5   No member or authorized
delegate of the Committee shall be liable to any person for any action taken or
omitted in connection with the administration of the Plan unless attributable to
his or her own fraud or gross misconduct. The Committee, the individual members
thereof, and persons acting as the authorized delegates of the Committee under
the Plan, shall be indemnified by the Employers against any and all liabilities,
losses, costs and expenses (including legal fees and expenses) of whatsoever
kind and nature which may be imposed on, incurred by, or asserted against, the
Committee or its members or authorized delegates by reason of the performance of
any action pursuant to the Plan if the Committee or its members or authorized
delegates did not act in willful violation of the law or regulation under which
such liability, loss, cost or expense arises. This indemnification shall not
duplicate but may supplement any coverage available under any applicable
insurance policy, contract with the indemnitee or the Company’s By-laws.   4.6.
  Notwithstanding any other provision of the Plan to the contrary, but without
giving effect to Awards made pursuant to Section 21, the maximum number of
shares of Stock with respect to which any Participant may receive any Award of
(i) an Option or a Stock Appreciation Right under the Plan during any calendar
year is 350,000; (ii) the maximum number of shares with respect to which any
Participant may receive Awards of Restricted Stock or Restricted Stock Units
during any calendar year is 100,000; (iii) the maximum number of shares with
respect to which any Participant may receive Merit Awards during any calendar
year is 200,000; and (iv) the maximum number of shares or cash value with
respect to which any Participant may receive other Awards during any calendar
year is 100,000 or $3,000,000, respectively (including the Awards described in
Sections 4.6(i) through 4.6(iii), which may be further granted pursuant to this
Section 4.6(iv)).   4.7.   To the extent that the Committee determines that it
is necessary or desirable to conform any Awards under the Plan with the
requirements applicable to “Performance-Based Compensation”, as that term is
used in Code Section 162(m)(4)(C), it may, at or prior to the time an Award is
granted, establish Performance Goals for a particular Performance Period. If the
Committee establishes Performance Goals for a Performance Period, it may approve
a payment from that particular Performance Period upon attainment of the
Performance Goal.   4.8.   Notwithstanding any other provision of the Plan to
the contrary, subject to the provisions of Section 20, any Full Value Award
issued on or after October 21, 2010 shall have the following minimum vesting
periods: (i) for any Full Value Award that is Performance-Based Compensation,
the Performance Period shall not end, and such Award shall not vest, prior to
one year after the date of grant; and (ii) any other Full Value Award shall have
a minimum vesting period of three years from the date of grant; provided,
however, that, subject to the provisions of Section 16, De Minimus Awards may be
granted without being subject to the minimum vesting periods set forth in this
Section 4.8.

SECTION 5
Shares Available Under the Plan

5.1.   The shares of Stock with respect to which Awards may be made under the
Plan shall be shares of currently authorized but unissued or treasury shares
acquired by the Company, including shares purchased in the open market or in
private transactions. Subject to the provisions of Section 16, the total number
of shares of Stock available for grant of Awards shall not exceed 22,500,000
shares of Stock. Except as otherwise provided herein, if any Award shall expire
or terminate for any reason without having been exercised in full, the unissued
shares of Stock subject thereto (whether or not cash or other consideration is
paid in

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    respect of such Award) shall again be available for the purposes of the
Plan. Any shares of Stock which are used as full or partial payment to the
Company upon exercise of an Award shall be available for purposes of the Plan.

SECTION 6
Options

6.1.   The grant of an “Option” under this Section 6 entitles the Participant to
purchase shares of Stock at a price fixed at the time the Option is granted, or
at a price determined under a method established at the time the Option is
granted, subject to the terms of this Section 6. Options granted under this
Section 6 may be either Incentive Stock Options or Non-Qualified Stock Options,
and subject to Subsection 6.6 and Sections 15 and 20, shall not be exercisable
for at least six months from the date of grant, as determined in the discretion
of the Committee. An “Incentive Stock Option” is an Option that is intended to
satisfy the requirements applicable to an “incentive stock option” described in
Section 422(b) of the Code. A “Non-Qualified Option” is an Option that is not
intended to be an “incentive stock option” as that term is described in Section
422(b) of the Code.   6.2.   The Committee shall designate the Employees and
Directors to whom Options are to be granted under this Section 6 and shall
determine the number of shares of Stock to be subject to each such Option. To
the extent that the aggregate Fair Market Value of Stock with respect to which
Incentive Stock Options are exercisable for the first time by any individual
during any calendar year (under all plans of the Company and all Related
Companies) exceeds $100,000, such Options shall be treated as Non-Qualified
Stock Options, but only to the extent required by Section 422 of the Code.  
6.3.   The determination and payment of the purchase price of a share of Stock
under each Option granted under this Section shall be subject to the following
terms of this Subsection 6.3:

  (a)   The purchase price shall be established by the Committee or shall be
determined by a method established by the Committee at the time the Option is
granted; provided, however, that in no event shall the price per share be less
than the Fair Market Value per share on the date of the grant except as
otherwise permitted by Section 21 of the Plan;     (b)   The full purchase price
of each share of Stock purchased upon the exercise of any Option shall be paid
at the time of such exercise and, as soon as practicable thereafter, a
certificate representing the shares so purchased shall be delivered to the
person entitled thereto; and     (c)   The purchase price shall be paid either
in cash, in shares of Stock (valued at Fair Market Value as of the day of
exercise), through a combination of cash and Stock (so valued) or through such
cashless exercise arrangement as may be approved by the Committee and
established by the Company.

6.4.   Except as otherwise expressly provided in the Plan, an Option granted
under this Section 6 shall be exercisable in accordance with the following terms
of this Subsection 6.4.

  (a)   The terms and conditions relating to exercise of an Option shall be
established by the Committee and shall be set forth in the applicable Award
Agreement, and may include, without limitation, conditions relating to
completion of a specified period of service, achievement of performance
standards prior to exercise of the Option, or achievement of Stock ownership
objectives by the Participant. No Option may be exercised by a Participant after
the expiration date applicable to that Option.     (b)   The exercise of an
Option will result in the surrender of the corresponding rights under a tandem
Stock Appreciation Right, if any.

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6.5.   The exercise period of any Option shall be determined by the Committee
and shall be set forth in the applicable Award Agreement but the term of any
Option shall not extend more than ten years after the date of grant.

SECTION 7
Stock Appreciation Rights

7.1.   Subject to the terms of this Section 7, a Stock Appreciation Right
granted under the Plan entitles the Participant to receive, in cash or Stock (as
determined in accordance with Subsection 7.4), value equal to all or a portion
of the excess of: (a) the Fair Market Value of a specified number of shares of
Stock at the time of exercise; over (b) a specified price which shall not be
less than 100% of the Fair Market Value of the Stock at the time the Stock
Appreciation Right is granted, or, if granted in tandem with an Option, the
exercise price with respect to shares under the tandem Option.   7.2.   Subject
to the provisions of the Plan, the Committee shall designate the Employees and
Directors to whom Stock Appreciation Rights are to be granted under the Plan,
shall determine the exercise price or a method by which the price shall be
established with respect to each such Stock Appreciation Right, and shall
determine the number of shares of Stock on which each Stock Appreciation Right
is based. A Stock Appreciation Right may be granted in connection with all or
any portion of a previously or contemporaneously granted Option or not in
connection with an Option. If a Stock Appreciation Right is granted in
connection with an Option then, in the discretion of the Committee, the Stock
Appreciation Right may, but need not, be granted in tandem with the Option.  
7.3.   The exercise of Stock Appreciation Rights shall be subject to the
following:

  (a)   If a Stock Appreciation Right is not in tandem with an Option, then the
Stock Appreciation Right shall be exercisable in accordance with the terms
established by the Committee in connection with such rights and as set forth in
the applicable Award Agreement but, subject to Sections 15 and 20, shall not be
exercisable for six months from the date of grant and the term of any Stock
Appreciation Right shall not extend more than ten years from the date of grant;
and may include, without limitation, conditions relating to completion of a
specified period of service, achievement of performance standards prior to
exercise of the Stock Appreciation Rights, or achievement of objectives relating
to Stock ownership by the Participant; and     (b)   If a Stock Appreciation
Right is in tandem with an Option, then the Stock Appreciation Right shall be
exercisable only at the time the tandem Option is exercisable and the exercise
of the Stock Appreciation Right will result in the surrender of the
corresponding rights under the tandem Option.

7.4.   Upon the exercise of a Stock Appreciation Right, the value to be
distributed to the Participant, in accordance with Subsection 7.1, shall be
distributed in shares of Stock (valued at their Fair Market Value at the time of
exercise), in cash, or in a combination of Stock or cash, in the discretion of
the Committee.

SECTION 8
Restricted Stock

8.1.   Subject to the terms of this Section 8, Restricted Stock Awards under the
Plan are grants of Stock to Participants, the vesting of which is subject to
certain conditions established by the Committee and set forth in the applicable
Award Agreement, with some or all of those conditions relating to events (such
as continued service or satisfaction of performance criteria) occurring after
the date of the grant of the Award, provided, however, that to the extent that
vesting of a Restricted Stock Award is contingent on continued service, the
required service period shall generally (unless otherwise determined by the
Committee) not be less than one year following the grant of the Award unless
such grant is in substitution for an Award under this Plan or a predecessor plan
of the Company or a Related Company. To the extent, if any, required by the
General Corporation Law of the State of Delaware, a Participant’s receipt of an
Award of newly issued

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    shares of Restricted Stock shall be made subject to payment by the
Participant of an amount equal to the aggregate par value of such newly issued
shares of Stock.

8.2.   The Committee shall designate the Employees and Directors to whom
Restricted Stock is to be granted, and the number of shares of Stock that are
subject to each such Award. The Award of shares under this Section 8 may, but
need not, be made in conjunction with a cash-based incentive compensation
program maintained by the Company, and may, but need not, be in lieu of cash
otherwise awardable under such program.   8.3.   Shares of Restricted Stock
granted to Participants under the Plan shall be subject to the following terms
and conditions:

  (a)   Restricted Stock granted to Participants may not be sold, assigned,
transferred, pledged or otherwise encumbered during the Restricted Period;    
(b)   The Participant as owner of such shares shall have all the rights of a
stockholder, including but not limited to the right to vote such shares and,
except as otherwise provided in the Award Agreement or as provided by the Plan,
the right to receive all dividends and other distributions paid on such shares.
    (c)   Each certificate issued in respect of shares of Restricted Stock
granted under the Plan shall be registered in the name of the Participant but,
at the discretion of the Committee, each such certificate may be deposited with
the Company with a stock power endorsed in blank or in a bank designated by the
Committee;     (d)   The Committee may award Restricted Stock as
Performance-Based Compensation, which shall be Restricted Stock that will be
earned (or for which earning is accelerated) upon the achievement of Performance
Goals established by the Committee and the Committee may specify the number of
shares that will be earned upon achievement of different levels of performance;
except as otherwise provided by the Committee, achievement of maximum targets
during the Performance Period shall result in the Participant’s earning of the
full amount of Restricted Stock comprising such Performance-Based Compensation
and, in the discretion of the Committee, achievement of the minimum target but
less than the maximum target, the Committee may result in the Participant’s
earning of a portion of the Award; and     (e)   Except as otherwise provided by
the Committee and set forth in the applicable Award Agreement, any Restricted
Stock which is not earned by the end of a Restricted Period or Performance
Period, as the case may be, shall be forfeited. If a Participant’s Date of
Termination occurs prior to the end of a Restricted Period or Performance
Period, as the case may be, the Committee may determine, in its sole discretion,
that the Participant will be entitled to settlement of all or any portion of the
Restricted Stock as to which he or she would otherwise be eligible, and may
accelerate the determination of the value and settlement of such Restricted
Stock or make such other adjustments as the Committee, in its sole discretion,
deems desirable. Subject to the limitations of the Plan and the Award of
Restricted Stock, upon the vesting of Restricted Stock, such Restricted Stock
will be transferred free of all restrictions to the Participant (or his or her
legal representative, beneficiary or heir).

SECTION 9
Restricted Stock Units

9.1.   Subject to the terms of this Section 9, a Restricted Stock Unit entitles
a Participant to receive shares for the units at the end of a Restricted Period,
or at a later date if distribution has been deferred, to the extent provided by
the Award with the vesting of such units to be contingent upon such conditions
as may be established by the Committee and set forth in the Award Agreement
(such as continued service or satisfaction of performance criteria) occurring
after the date of grant of the Award, provided, however, that to the extent that
the vesting of a Restricted Stock Unit is contingent on continued service, the
required

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    employment period shall generally not be less than one year following the
date of grant of the Award unless such grant is in substitution for an Award
under this Plan or a predecessor plan of the Company or a Related Company.
Notwithstanding the foregoing, Restricted Stock Units may be settled in the form
of Stock, or cash or a combination of both, as the Committee may determine. The
amount of any cash to be paid in lieu of shares of Stock shall be determined on
the basis of the Fair Market Value of the Stock on the date any such payment is
processed. The Award of Restricted Stock Units under this Section 9 may, but
need not, be made in conjunction with a cash-based incentive compensation
program maintained by the Company, and may, but need not, be in lieu of cash
otherwise awardable under such program.

9.2.   The Committee shall designate the Employees and Directors to whom
Restricted Stock Units shall be granted and the number of units that are subject
to each such Award. During any period in which Restricted Stock Units are
outstanding and have not been settled in Stock, the Participant shall not have
the rights of a stockholder, but, in the discretion of the Committee, may be
granted the right to receive a payment from the Company in lieu of a dividend in
an amount equal to any cash dividends that might be paid during the Restricted
Period.   9.3   Except as otherwise provided by the Committee, any Restricted
Stock Unit which is not earned by the end of a Restricted Period shall be
forfeited. If a Participant’s Date of Termination occurs prior to the end of a
Restricted Period, the Committee, in its sole discretion, may determine that the
Participant will be entitled to settlement of all, any portion, or none of the
Restricted Stock Units as to which he or she would otherwise be eligible, and
may accelerate the determination of the value and settlement of such Restricted
Stock Units or make such other adjustments as the Committee, in its sole
discretion, deems desirable.   9.4   Notwithstanding anything to the contrary in
this Section 9, an election to defer receipt of shares at the end of a
Restricted Period may be made by a Participant only in accordance with the terms
of a separate written nonqualified deferred compensation plan sponsored by the
Company and only to the extent made in accordance with the election timing rules
under Code Section 409A. Unless otherwise subject to such a deferral election,
Restricted Stock Units shall be settled on or after the last day of the
Restricted Period set forth in the Award Agreement, but in no event later than
the March 15th of the calendar year following the calendar year in which the
Restricted Period ends. Any acceleration of the settlement of a Restrict Stock
Unit Award described in Section 9.3 shall be made only to the extent permissible
under Code Section 409A.

SECTION 10
Performance Stock

10.1.   Subject to the terms of this Section 10, an Award of Performance Stock
provides for the distribution of Stock to a Participant upon the achievement of
performance objectives, which may include Performance Goals, established by the
Committee and set forth in the applicable Award Agreement.   10.2.   The
Committee shall designate the Employees and Directors to whom Awards of
Performance Stock are to be granted, and the number of shares of Stock that are
subject to each such Award. The Award of shares of Performance Stock under this
Section 10 may, but need not, be made in conjunction with a cash-based incentive
compensation program maintained by the Company, and may, but need not, be in
lieu of cash otherwise awardable under such program.   10.3.   Except as
otherwise provided by the Committee and set forth in the applicable Award
Agreement, any Award of Performance Stock which is not earned by the end of the
Performance Period shall be forfeited. If a Participant’s Date of Termination
occurs prior to the end of a Performance Period, the Committee, in its sole
discretion, may determine that the Participant will be entitled to settlement of
all, any portion, or none of the Performance Stock as to which he or she would
otherwise be eligible, and may accelerate the determination of the value and
settlement of such Performance Stock or make such other adjustments as the
Committee, in its sole discretion, deems desirable.   10.4   Except as otherwise
provided by the Committee under Section 10.3 or in an Award Agreement,
settlement of any earned Performance Stock shall occur on or after the last day
of the Performance Period, but in no

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    event later than the March 15th of the calendar year following the calendar
year in which the Performance Period ends. Any acceleration of the settlement of
a Performance Share described in Section 10.3 shall be made only to the extent
permissible under Code Section 409A.

SECTION 11
Performance Units

11.1.   Subject to the terms of this Section 11, the Award of Performance Units
under the Plan entitles the Participant to receive value for the units at the
end of a Performance Period to the extent provided under the Award. The number
of Performance Units earned, and value received from them, will be contingent on
the degree to which the performance measures set forth in the Award Agreement
are met.   11.2.   The Committee shall designate the Employees and Directors to
whom Performance Units are to be granted, and the number of Performance Units to
be subject to each such Award.   11.3.   For each Participant, the Committee
will determine the value of Performance Units, which may be stated either in
cash or in units representing shares of Stock; the performance measures used for
determining whether the Performance Units are earned; the Performance Period
during which the performance measures will apply; the relationship between the
level of achievement of the performance measures and the degree to which
Performance Units are earned; whether, during or after the Performance Period,
any revision to the performance measures or Performance Period should be made to
reflect significant events or changes that occur during the Performance Period;
and the number of earned Performance Units that will be settled in cash and/or
shares of Stock.   11.4.   Settlement of Performance Units shall be subject to
the following:

  (a)   The Committee will compare the actual performance to the performance
measures established for the Performance Period and determine the number of
Performance Units as to which settlement is to be made;     (b)   Settlement of
Performance Units earned shall be wholly in cash, wholly in Stock or in a
combination of the two, as determined by the Committee, and shall be distributed
in the form set forth in the Award Agreement. If the Award Agreement does not
provide for a form of payment, payment shall be made in a single lump sum
payment. Except as otherwise provided by the Committee under Section 11.5 or in
an Award Agreement, settlement of any earned Performance Units shall occur on or
after the last day of the Performance Period, but in no event later than the
March 15th of the calendar year following the calendar year in which the
Performance Period ends. Any acceleration of the settlement of a Performance
Unit described in Section 11.5 shall be made only to the extent permissible
under Code Section 409A; and     (c)   Shares of Stock distributed in settlement
of Performance Units shall be subject to such vesting requirements and other
conditions, if any, as the Committee shall determine, including, without
limitation, restrictions of the type that may be imposed with respect to
Restricted Stock under Section 8.

11.5.   Except as otherwise provided by the Committee and set forth in the
applicable Award Agreement, any Award of Performance Units which is not earned
by the end of the Performance Period shall be forfeited. If a Participant’s Date
of Termination occurs prior to the end of a Performance Period, the Committee,
in its sole discretion, may determine that the Participant will be entitled to
settlement of all, any portion, or none of the Performance Units as to which he
or she would otherwise be eligible, and may accelerate the determination of the
value and settlement of such Performance Units or make such other adjustments as
the Committee, in its sole discretion, deems desirable.

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SECTION 12
Stock Purchase Program

12.1.   The Committee may, from time to time, establish one or more programs
under which Employees and Directors will be permitted to purchase shares of
Stock under the Plan, and shall designate the Employees and Directors eligible
to participate under such Stock purchase programs. The purchase price for shares
of Stock available under such programs, and other terms and conditions of such
programs, shall be established by the Committee. The purchase price may not be
less than 75% of the Fair Market Value of the Stock at the time of purchase (or,
in the Committee’s discretion, the average Stock value over a period determined
by the Committee), and further provided that if newly issued shares of Stock are
sold, the purchase price may not be less than the aggregate par value of such
newly issued shares of Stock.   12.2.   The Committee may impose such
restrictions with respect to shares purchased under this Section 12, as the
Committee, in its sole discretion, determines to be appropriate. Such
restrictions may include, without limitation, restrictions of the type that may
be imposed with respect to Restricted Stock under Section 8.

SECTION 13
Stock Awards

13.1.   The Committee may from time to time make an Award of Stock under the
Plan to selected Employees or Directors for such reasons and in such amounts as
the Committee, in its sole discretion, may determine. The consideration to be
paid by an Employee or Director for any such Award, if any, shall be fixed by
the Committee from time to time, but, if required by the General Corporation Law
of the State of Delaware, it shall not be less than the aggregate par value of
the shares of Stock awarded to him or her.

SECTION 14
Phantom Stock Awards

14.1.   The Committee may make Phantom Stock Awards to selected Employees and
Directors which may be based solely on the value of the underlying shares of
Stock, solely on any earnings or appreciation thereon, or both. Subject to the
provisions of the Plan, the Committee shall have the sole and complete authority
to determine the number of hypothetical or target shares as to which each such
Phantom Stock Award is subject and to determine the terms and conditions of each
such Phantom Stock Award. There may be more than one Phantom Stock Award in
existence at any one time with respect to a selected Employee or Director, and
the terms and conditions of each such Phantom Stock Award may differ from each
other.   14.2.   The Committee shall establish and shall set forth in the
applicable Award Agreement the vesting or performance measures for each Phantom
Stock Award on the basis of such criteria and to accomplish such objectives as
the Committee may from time to time, in its sole discretion, determine. Such
measures may be based on years of service or periods of employment, or the
achievement of individual or corporate performance objectives, but shall, in
each instance, be based upon one or more of the business criteria as determined
pursuant to Section 4.7. The vesting and performance measures determined by the
Committee shall be established at the time a Phantom Stock Award is made.
Phantom Stock Awards may not be sold, assigned, transferred, pledged, or
otherwise encumbered, except as provided in Section 17, during the Performance
Period.   14.3.   Settlement of Phantom Stock earned shall be wholly in cash,
wholly in Stock or in a combination of the two, as determined by the Committee,
and shall be distributed in the form set forth in the Award Agreement. If the
Award Agreement does not provide for a form of payment, payment shall be made in
a single lump sum payment. Except as otherwise provided by the Committee under
Section 14.4 or in an Award Agreement, settlement of any earned Phantom Stock
shall occur on or after the last day of the Performance Period, but in no event
later than the March 15th of the calendar year following the calendar year in
which the Performance Period ends. Any acceleration of the settlement of Phantom
Stock described in Section 14.4 shall be made only to the extent permissible
under Code Section 409A.

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14.4.   Except as otherwise provided by the Committee and set forth in the
applicable Award Agreement, any Award of Phantom Stock which is not earned by
the end of the Performance Period shall be forfeited. If a Participant’s Date of
Termination occurs prior to the end of a Performance Period, the Committee, in
its sole discretion, may determine that the Participant will be entitled to
settlement of all or a portion of the Phantom Stock for which he or she would
otherwise be eligible, and may accelerate the determination of the value and
settlement of Phantom Stock or make such other adjustment as the Committee, in
its sole discretion, deems desirable.

SECTION 15
Termination of Service

15.1.   If a Participant’s service is terminated by the Participant’s Employer
for Cause, all of the Participant’s unvested Awards, including any unexercised
Options, shall be forfeited.   15.2.   Except as may be set forth in the
applicable Award Agreement, with respect to Awards made prior to July 22, 2004,
if a Participant’s Date of Termination occurs by reason of death, Disability or
Retirement, all Options and Stock Appreciation Rights outstanding immediately
prior to the Participant’s Date of Termination shall immediately become
exercisable and shall be exercisable until one year from the Participant’s Date
of Termination and thereafter shall be forfeited if not exercised, and all
restrictions on any Awards outstanding immediately prior to the Participant’s
Date of Termination shall immediately lapse. Except as may be set forth in the
applicable Award Agreement, for Awards made after July 22, 2004, if a
Participant’s Date of Termination occurs by reason of death or Disability,
(i) all unvested Awards outstanding immediately prior to the Participant’s Date
of Termination shall continue to vest as if such Participant had remained in the
service of the Company and (ii) all vested Options and Stock Appreciation Rights
shall remain exercisable and, in each case, such Awards shall be exercisable
until one year from the later of the (i) Participant’s Date of Termination or
(ii) the vesting date of such Award and thereafter shall be forfeited. Except as
may be set forth in the applicable Award Agreement, for Awards made after
July 22, 2004, if a Participant’s Date of Termination occurs by reason of
Retirement, (i) all unvested Awards outstanding immediately prior to the
Participant’s Date of Termination shall be forfeited and (ii) all vested Options
and Stock Appreciation Rights shall remain exercisable and shall be exercisable
until one year from the Participant’s Date of Termination and thereafter shall
be forfeited. Options and Stock Appreciation Rights which are or become
exercisable at the time of a Participant’s death may be exercised by the
Participant’s designated beneficiary or, in the absence of such designation, by
the person to whom the Participant’s rights will pass by will or the laws of
descent and distribution.   15.3.   Except as may be set forth in the applicable
Award Agreement, for Awards made prior to July 22, 2004, if a Participant’s Date
of Termination occurs by reason of Participant’s employment being terminated by
the Participant’s Employer for any reason other than Cause, or by the
Participant with the written consent and approval of the Participant’s Employer,
the Restricted Period shall lapse on a proportion of any Awards outstanding
immediately prior to the Participant’s Date of Termination (except that, to the
extent that an Award of Restricted Stock, Restricted Stock Units, Performance
Units, Performance Stock and Phantom Stock is subject to a Performance Period),
such proportion of the Award shall remain subject to the same terms and
conditions for vesting as were in effect prior to the Date of Termination and
shall be determined at the end of the Performance Period. The proportion of an
Award upon which the Restricted Period shall lapse shall be a fraction, the
denominator of which is the total number of months of any Restricted Period
applicable to an Award and the numerator of which is the number of months of
such Restricted Period which elapsed prior to the Date of Termination. Except as
may be set forth in the applicable Award Agreement, for Awards made after
July 22, 2004, if a Participant’s Date of Termination occurs by reason of
Participant’s service being terminated by the Participant’s Employer for any
reason other than Cause, or by the Participant with the written consent and
approval of the Participant’s Employer, (i) all unvested Awards outstanding
immediately prior to the Participant’s Date of Termination shall be forfeited
and (ii) all vested Options and Stock Appreciate Rights shall remain exercisable
as provided in Section 15.4.   15.4.   Options and Stock Appreciation Rights
which are or become exercisable by reason of the Participant’s service being
terminated by the Participant’s Employer for reasons other than Cause or by the
Participant

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    with the consent and approval of the Participant’s Employer, shall be
exercisable until 60 days from the Participant’s Termination Date and shall
thereafter be forfeited if not exercised.

15.5.   Except to the extent the Company shall otherwise determine, if, as a
result of a sale or other transaction (other than a Change in Control), a
Participant’s Employer ceases to be a Related Company (and the Participant’s
Employer is or becomes an entity that is separate from the Company), the
occurrence of such transaction shall be treated as the Participant’s Date of
Termination caused by the Participant’s service being terminated by the
Participant’s Employer for a reason other than Cause.   15.6.   Notwithstanding
the foregoing provisions of this Section 15, the Committee may, with respect to
any Awards of a Participant (or portion thereof) that are outstanding
immediately prior to the Participant’s Date of Termination, determine that a
Participant’s Date of Termination will not result in forfeiture or other
termination of the Award, or may extend the period during which any Options or
Stock Appreciation Rights may be exercised, but shall not extend such period
beyond the expiration date set forth in the Award. In no event may an Option or
Stock Appreciation Right be extended to a date which is more than ten years from
the date of grant.

SECTION 16
Adjustments to Shares

16.1.   If the Company shall effect a reorganization, merger, or consolidation,
or similar event or effect any subdivision or consolidation of shares of Stock
or other capital readjustment, payment of stock dividend, stock split, spin-off,
combination of shares or recapitalization or other increase or reduction of the
number of shares of Stock outstanding without receiving compensation therefor in
money, services or property, then the Committee shall appropriately adjust
(i) the number of shares of Stock available under the Plan, (ii) the number of
shares of Stock available under any individual or other limitations under the
Plan, (iii) the number of shares of Stock subject to outstanding Awards and
(iv) the per-share price under any outstanding Award to the extent that the
Participant is required to pay a purchase price per share with respect to the
Award.   16.2.   If the Committee determines that an adjustment in accordance
with the provisions of Subsection 16.1 would not be fully consistent with the
purposes of the Plan or the purposes of the outstanding Awards under the Plan,
the Committee may make such other adjustments, if any, that the Committee
reasonably determines are consistent with the purposes of the Plan and/or the
affected Awards.   16.3.   To the extent that any reorganization, merger,
consolidation, or similar event or any subdivision or consolidation of shares of
Stock or other capital readjustment, payment of stock dividend, stock split,
spin-off, combination of shares or recapitalization or other increase or
reduction of the number of shares of Stock hereunder is also accompanied by or
related to a Change in Control, the adjustment hereunder shall be made prior to
the acceleration contemplated by Section 20.

SECTION 17
Transferability and Deferral of Awards

17.1.   Awards under the Plan are not transferable except by will or by the laws
of descent and distribution. To the extent that a Participant who receives an
Award under the Plan has the right to exercise such Award, the Award may be
exercised during the lifetime of the Participant only by the Participant.
Notwithstanding the foregoing provisions of this Section 17, the Committee may,
subject to any restrictions under applicable securities laws, permit Awards
under the Plan (other than an Incentive Stock Option) to be transferred by a
Participant for no consideration to or for the benefit of the Participant’s
Immediate Family (including, without limitation, to a trust for the benefit of a
Participant’s Immediate Family or to a Partnership comprised solely of members
of the Participant’s Immediate Family), subject to such limits as the Committee
may establish, provided the transferee shall remain subject to all of the terms
and conditions applicable to such Award prior to such transfer.

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17.2.   The Committee may permit a Participant to elect to defer payment under
an Award under such terms and conditions as the Committee, in its sole
discretion, may determine; provided that, any such deferral election must be
made in accordance with the terms of a separate written nonqualified deferred
compensation plan sponsored by the Company and only to the extent made in
accordance with the election timing rules under Code Section 409A.

SECTION 18
Award Agreement

18.1.   Each Participant granted an Award pursuant to the Plan shall sign an
Award Agreement which signifies the offer of the Award by the Company and the
acceptance of the Award by the Participant in accordance with the terms of the
Award and the provisions of the Plan. Each Award Agreement shall reflect the
terms and conditions of the Award. Participation in the Plan shall confer no
rights to continued service with an Employer nor shall it restrict the right of
an Employer to terminate a Participant’s service at any time for any reason, not
withstanding the fact that the Participant’s rights under this Plan may be
negatively affected by such action.

SECTION 19
Tax Withholding

19.1   All Awards and other payments under the Plan are subject to withholding
of all applicable taxes, which withholding obligations shall be satisfied
(without regard to whether the Participant has transferred an Award under the
Plan) by a cash remittance, or with the consent of the Committee, through the
surrender of shares of Stock which the Participant owns or to which the
Participant is otherwise entitled under the Plan pursuant to an irrevocable
election submitted by the Participant to the Company at the office designated
for such purpose. The number of shares of Stock needed to be submitted in
payment of the taxes shall be determined using the Fair Market Value as of the
applicable tax date rounding down to the nearest whole share.

SECTION 20
Change in Control

20.1.   After giving effect to the provisions of Section 16 (relating to the
adjustment of shares of Stock), and except as otherwise provided in the Plan or
the Agreement reflecting the applicable Award, upon the occurrence of a Change
in Control:

  (a)   All outstanding Options (regardless of whether in tandem with Stock
Appreciation Rights) shall become fully exercisable and may be exercised at any
time during the original term of the Option;     (b)   All outstanding Stock
Appreciation Rights (regardless of whether in tandem with Options) shall become
fully exercisable and may be exercised at any time during the original term of
the Option;     (c)   All shares of Stock subject to Awards shall become fully
vested and be distributed to the Participant; and     (d)   Performance Units
may be paid out in such manner and amounts as may be reasonably determined by
the Committee.

    The accelerated payment of any Award upon a Change in Control as described
in this Section 20.1 shall occur only to the extent such payment would not
result in an adverse tax consequence to the Participant under Code Section 409A.
In addition, Performance Units shall be paid in accordance with the terms of the
Award Agreement.

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SECTION 21
MERGERS / ACQUISITIONS

21.1   In the event of any merger or acquisition involving the Company and/or a
Subsidiary of the Company and another entity which results in the Company being
the survivor or the surviving direct or indirect parent corporation of the
merged or acquired entity, the Committee may grant Awards under the provisions
of the Plan in substitution for awards held by employees or former employees of
such other entity under any plan of such entity immediately prior to such merger
or acquisition upon such terms and conditions as the Committee, in its
discretion, shall determine and as otherwise may be required by the Code to
ensure such substitution is not treated as the grant of a new Award for tax or
accounting purposes.   21.2   In the event of a merger or acquisition involving
the Company in which the Company is not the surviving corporation, the Acquiring
Corporation shall either assume the Company’s rights and obligations under
outstanding Awards or substitute awards under the Acquiring Corporation’s plans,
or if none, securities for such outstanding Awards. In the event the Acquiring
Corporation elects not to assume or substitute for such outstanding Awards, and
without limiting Section 20, the Board shall provide that any unexercisable
and/or unvested portion of the outstanding Awards shall be immediately
exercisable and vested as of a date prior to such merger or consolidation, as
the Board so determines. The exercise and/or vesting of any Award that was
permissible solely by reason of this Section 21.2 shall be conditioned upon the
consummation of the merger or consolidation. Unless otherwise provided in the
Plan or the Award, any Awards which are neither assumed by the Acquiring
Corporation nor exercised on or prior to the date of the transaction shall
terminate effective as of the effective date of the transaction.

SECTION 22
Termination and Amendment

22.1   The Board may suspend, terminate, modify or amend the Plan, provided that
any amendment that would (a) increase the aggregate number of shares of Stock
which may be issued under the Plan, (b) change the method of determining the
exercise price of Options, other than to change the method of determining Fair
Market Value of Stock as set forth in Section 2.1(r) of the Plan, or
(c) materially modify the requirements as to eligibility for participation in
the Plan, shall be subject to the approval of the Company’s stockholders, except
that any such increase or modification that may result from adjustments
authorized by Section 16 does not require such approval. No suspension,
termination, modification or amendment of the Plan may terminate a Participant’s
existing Award or materially and adversely affect a Participant’s rights under
such Award without the Participant’s consent. Notwithstanding any provision
herein to the contrary, the Board may amend or revise this Plan to comply with
applicable laws or governmental regulations.   22.2   Notwithstanding any
provision herein to the contrary, the repricing of Options or Stock Appreciation
Rights is prohibited without prior approval of the Company’s stockholders. For
this purpose, a “repricing” means any of the following (or any other action that
has the same effect as any of the following): (a) changing the terms of an
Option or Stock Appreciation Right to lower its Exercise Price; (b) any other
action that is treated as a “repricing” under generally accepted accounting
principles; and (c) repurchasing for cash or canceling an Option or Stock
Appreciation Right at a time when its Exercise Price is greater than the Fair
Market Value of the underlying Stock in exchange for another Award, unless the
cancellation and exchange occurs in connection with a change in capitalization
or similar change under Section 21 above. Such cancellation and exchange as
described in clause (c) of the preceding sentence would be considered a
“repricing” 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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