Exhibit 10 (i)

TIM HORTONS INC.

U.S. NON-EMPLOYEE DIRECTORS’ DEFERRED COMPENSATION PLAN

AS AMENDED AND RESTATED EFFECTIVE AS OF JANUARY 1, 2008

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TIM HORTONS INC.

U.S. NON-EMPLOYEE DIRECTORS’ DEFERRED COMPENSATION PLAN

AS AMENDED AND RESTATED EFFECTIVE AS OF JANUARY 1, 2008

 

Table of Contents      Page Article 1 - Definitions    1

1.1

  

Account

   1

1.2

  

Administrator

   1

1.3

  

Annual Fee Deferrals

   1

1.4

  

Annual Fees

   1

1.5

  

Change in Control

   1

1.6

  

Code

   1

1.7

  

Deferral Election

   1

1.8

  

Deferrals

   1

1.9

  

DSU

   1

1.10

  

DSU Deferrals

   2

1.11

  

Director

   2

1.12

  

Disability

   2

1.13

  

Distribution Election

   2

1.14

  

Investment Fund

   2

1.15

  

Participant

   2

1.16

  

Plan Year

   2

1.17

  

Separation from Service

   2

1.18

  

Service Recipient

   3 Article 2 - Participation    3

2.1

  

Commencement of Participation

   3

2.2

  

Loss of Director Status

   3 Article 3 - Contributions    3

3.1

  

Deferral Elections

   3

3.2

  

Crediting of Contributions

   4 Article 4 - Accounts    4

4.1

  

Accounts

   4

4.2

  

Vesting

   4

4.3

  

Investments, Gains and Losses Attributable to Deferrals

   4 Article 5 - Distributions    5

5.1

  

Distribution Election

   5

 

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5.2

  

Distributions Other Than in the Event of Death or Disability

   5

5.3

  

Substantially Equal Annual Installments

   5

5.4

  

Distributions upon Disability

   5

5.5

  

Distributions upon Death

   5

5.6

  

Changes to Distribution Elections

   6 Article 6 - Beneficiaries    6

6.1

  

Beneficiaries

   6

6.2

  

Lost Participant and/or Beneficiary

   7 Article 7 - Funding    7

7.1

  

Prohibition Against Funding

   7

7.2

  

Withholding of Annual Fees

   7 Article 8 - Claims Administration    7

8.1

  

General

   7

8.2

  

Claims Procedure

   8

8.3

  

Right of Appeal

   8

8.4

  

Review of Appeal

   8

8.5

  

Designation

   9 Article 9 - General Provisions    9

9.1

  

Administrator

   9

9.2

  

No Assignment

   10

9.3

  

No Service Rights

   10

9.4

  

Incompetence

   10

9.5

  

Other Benefits

   10

9.6

  

Right of Setoff

   11

9.7

  

Expenses

   11

9.8

  

Tax Withholding

   11

9.9

  

Amendment, Modification, Suspension or Termination

   11

9.10

  

Successors

   11

9.11

  

Construction

   12

9.12

  

Governing Law

   12

9.13

  

Severability

   12

9.14

  

Headings

   12

9.15

  

Terms

   12

9.16

  

Code Section 409A Compliance

   12

9.17

  

Payments Upon Income Inclusion Under Code Section 409A

   12

 

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TIM HORTONS INC.

U.S. NON-EMPLOYEE DIRECTORS’ DEFERRED COMPENSATION PLAN

AS AMENDED AND RESTATED EFFECTIVE AS OF JANUARY 1, 2008

Effective December 5, 2006 (the “Effective Date”), Tim Hortons Inc. (the
“Company”) adopted the Tim Hortons Inc. U.S. Non-Employee Directors’ Deferred
Compensation Plan (the “Plan”). Effective as of January 1, 2008, the Company
hereby amends and restates the Plan to satisfy the requirements of Code
Section 409A and the Treasury Regulations promulgated thereunder. This Plan is
an unfunded arrangement and is intended to comply with Code Section 409A. This
Plan is not intended to constitute a plan subject to the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”), and the regulations
promulgated thereunder.

ARTICLE 1—DEFINITIONS

 

1.1 Account.

The bookkeeping account established for each Participant as provided in
Section 4.1 hereof.

 

1.2 Administrator.

The Company or a committee appointed by the Company to administer the Plan.

 

1.3 Annual Fee Deferrals.

The Annual Fees that a Participant elects to defer in accordance with
Section 3.1 hereof.

 

1.4 Annual Fees.

With respect to each Plan Year, the cash payments and fees (including the annual
retainer and all meeting and committee fees) which, absent a Deferral Election,
would be payable to each Director by the Company in connection with his or her
service as a Director.

 

1.5 Change in Control.

“Change in Control” shall have the meaning set forth in the attached Exhibit A.

 

1.6 Code.

The Internal Revenue Code of 1986, as amended.

 

1.7 Deferral Election.

The separate agreement, submitted to the Administrator, by which a Director
agrees to make an Annual Fee Deferral and/or a DSU Deferral to the Plan.

 

1.8 Deferrals.

Annual Fee Deferrals and DSU Deferrals.

 

1.9 DSU.

A Deferred Stock Unit granted to a Director under the Non-Employee Director
Deferred Stock Unit Plan or any successor thereto.

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1.10 DSU Deferrals.

The amount that otherwise would be taxable to a Participant upon the payment of
a DSU, but which the Participant has elected to defer in accordance with
Section 3.1 hereof.

 

1.11 Director.

An individual who (a) is a member of the Board of Directors of the Company,
(b) is not an employee of the Company or any of the Company’s subsidiaries or
affiliates and (c) is a resident of the United States.

 

1.12 Disability.

A Participant shall be considered disabled if:

(a) the Participant is unable to engage in any substantial gainful activity by
reason of any medically determinable physical or mental impairment that can be
expected to result in death or can be expected to last for a continuous period
of not less than twelve (12) months; or

(b) the Participant is, by reason of any medically determinable physical or
mental impairment that can be expected to result in death or can be expected to
last for a continuous period of not less than twelve (12) months, receiving
income replacement benefits for a period of not less than three (3) months under
an accident and health plan covering employees of the Participant’s employer (as
such term is defined under Code Section 409A); or

(c) the Participant is determined to be totally disabled by the Social Security
Administration or the Railroad Retirement Board.

 

1.13 Distribution Election.

The separate agreement, submitted to the Administrator, pursuant to which the
time and form of distribution of a Participant’s Account may be elected.

 

1.14 Investment Fund.

Each investment which serves as a means to measure increases or decreases with
respect to a Participant’s Account pursuant to Section 4.3.

 

1.15 Participant.

A Director who is a Participant as provided in Article 2.

 

1.16 Plan Year.

January 1 through December 31.

 

1.17 Separation from Service.

A separation from service with the Service Recipient within the meaning of
Treasury Regulation Section 1.409A-1(h).

 

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1.18 Service Recipient.

The Company and all persons with whom the Company would be considered a single
employer under Code Sections 414(b) and (c).

ARTICLE 2—PARTICIPATION

 

2.1 Commencement of Participation.

Each Director shall become a Participant on the later of the Effective Date or
the first day of the month following the date on which the individual becomes a
Director.

 

2.2 Loss of Director Status.

A Participant who is no longer a Director shall not be permitted to submit a
Deferral Election. All Deferrals for such a Participant shall cease immediately
following the date on which such Participant Separates from Service as a
Director. Amounts credited to the Account of a Participant who Separates from
Service as a Director shall continue to be held pursuant to the terms of the
Plan and shall be distributed as provided in Article 5.

ARTICLE 3—CONTRIBUTIONS

 

3.1 Deferral Elections.

(a) General. A Participant’s Deferral Election for a Plan Year is irrevocable
for that applicable Plan Year. Amounts deferred under the Plan shall not be made
available to the Participant, except as provided in Article 5, and shall reduce
the amounts paid to the Participant in the year of the Deferral from the Company
in accordance with the provisions of the applicable Deferral Election; provided,
however, that all such amounts shall be subject to the rights of the general
creditors of the Company as provided in Article 7.

(b) Time of Deferral Election. A Deferral Election shall be void if it is not
made in a timely manner as follows:

(i) With respect to compensation for services performed during a Plan Year, a
Deferral Election must be submitted to the Administrator no later than the close
of the Plan Year immediately preceding the Plan Year during which the services
are to be performed and the amount to be deferred will be earned and/or the
applicable DSU(s) will be granted, as the case may be. Such Deferral Election
shall be irrevocable as of the date described in this Section 3.1(b).

(ii) Notwithstanding the foregoing and in the discretion of the Company, a
Deferral Election may be submitted within thirty (30) days after the date on
which the Participant is first eligible to participate in this Plan, with
respect to Annual Fees to be paid and/or DSUs to be granted for services
performed after such Deferral Election is made. For purposes of this
Section 3.1(b)(ii), a Participant is first eligible to participate in this Plan
only if the Participant is not a participant in any other agreement, method,
program or arrangement that, along with this Plan, would be treated as a single
nonqualified deferred compensation plan under Treasury Regulation
Section 1.409A-1(c)(2).

 

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(c) Subject to the limitations set forth in Sections 3.1(a) and (b) hereof,
Annual Fee Deferrals must be made in whole percentages with such limitations as
may be determined by the Administrator from time to time in its sole discretion.

 

3.2 Crediting of Contributions.

Deferrals shall be credited to a Participant’s Account as soon as
administratively feasible following the date on which the Annual Fees would have
been paid to the Participant or the DSUs would have been paid, as applicable,
absent the Participant’s Deferral.

ARTICLE 4—ACCOUNTS

 

4.1 Accounts.

The Administrator shall establish and maintain a bookkeeping account in the name
of each Participant. Each Participant’s Account shall be credited with any
Deferrals and the Participant’s allocable share of any deemed earnings or losses
on such Deferrals. Each Participant’s Account shall be reduced by any
distributions made from such Account.

 

4.2 Vesting.

A Participant shall be one hundred percent (100%) vested in his or her Account
and any deemed earnings or losses on the investment of his or her Deferrals.

 

4.3 Investments, Gains and Losses Attributable to Deferrals.

(a) A Participant may direct that his or her Account be valued as if the
Deferrals were invested in multiples of one percent (1%) in one or more
Investment Funds as selected by the Company. The Company may from time to time,
at the discretion of the Administrator, change the Investment Funds for purposes
of this Plan.

(b) The Administrator shall adjust the amounts credited to each Participant’s
Account to reflect Deferrals, investment experience, distributions and any other
appropriate adjustments. Interest shall accrue daily and shall be credited to a
Participant’s Account quarterly.

(c) A Participant may change his or her selection of Investment Funds no more
than six (6) times each Plan Year with respect to his or her Account by filing a
new election in accordance with procedures established by the Administrator. An
election shall be effective as soon as administratively feasible following the
date of the change as indicated by the Participant in a form prescribed by the
Administrator.

(d) Notwithstanding the Participant’s ability to designate the Investment Funds
in which his or her Account shall be deemed invested, the Company shall have no
obligation to invest any funds in accordance with the Participant’s election.
Participants’ Accounts shall merely be bookkeeping entries on the Company’s
books, and no Participant shall obtain any property right or interest in any
Investment Fund.

 

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ARTICLE 5—DISTRIBUTIONS

 

5.1 Distribution Election.

Each Participant may make a Distribution Election with respect to the form and
timing of the distribution of the Participant’s Account and designate the manner
in which payments shall be made from the choices available under Section 5.2.
Such Distribution Election must be made with the Participant’s first Deferral
Election. A Participant’s Distribution Election shall continue to be effective
until changed as provided in Section 5.6. Notwithstanding anything to the
contrary contained herein, no acceleration of the time or schedule of payments
under the Plan shall occur except as permitted under this Plan and Code
Section 409A(a)(3) and the Treasury Regulations promulgated thereunder.

 

5.2 Distributions Other Than in the Event of Death or Disability.

Except in the event of a Participant’s death or Disability, if a Participant has
a Separation from Service, the Participant’s Account shall be (or shall begin to
be) distributed within thirty (30) days after the first anniversary of the
Participant’s Separation from Service. Such distribution of the Participant’s
Account shall be made either in a lump-sum payment or in substantially equal
annual installments, as defined in Section 5.3 below, over a period of up to ten
(10) years as elected by the Participant pursuant to his or her Distribution
Election. For purposes of this Section 5.2, if a Participant fails properly to
designate the form and timing of the distribution, the Participant’s Account
shall be paid in a lump-sum payment within thirty (30) days after the first
anniversary of the Participant’s Separation from Service.

 

5.3 Substantially Equal Annual Installments.

The amount of the substantially equal payments shall be determined by
multiplying the Participant’s Account by a fraction, the denominator of which in
the first year of payment equals the number of years (not to exceed ten
(10)) over which the Participant has elected benefits to be paid, and the
numerator of which is one (1). The amount of the payments for each succeeding
year shall be determined by multiplying the Participant’s Account as of the
applicable anniversary of the payout by a fraction, the denominator of which
equals the number of remaining years over which benefits are to be paid, and the
numerator of which is one (1). The annual installments shall be paid each year
within thirty (30) days after the applicable anniversary of the Participant’s
Separation from Service.

 

5.4 Distributions upon Disability.

Notwithstanding a Participant’s Distribution Election, upon the Participant’s
Disability, all amounts credited to his or her Account shall be paid to the
Participant in a lump-sum, as soon as administratively feasible but no later
than ninety (90) days following the date of Disability.

 

5.5 Distributions upon Death.

Notwithstanding a Participant’s Distribution Election, upon the Participant’s
death (whether before or after any distribution of the Participant’s Account has
begun), all amounts

 

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credited to his or her Account that remain undistributed shall be paid to the
Participant’s beneficiary or beneficiaries (as determined under Article 6) in a
lump-sum, as soon as administratively feasible but no later than ninety
(90) days following his or her date of death.

 

5.6 Changes to Distribution Elections.

(a) To the extent permitted by the Administrator in its sole discretion, on or
before December 31, 2008, a Participant may change the form or timing of the
distribution of the Participant’s Account (based on the choices available under
Section 5.2) by filing a new Distribution Election with the Administrator on or
before December 31, 2008; provided, however, that a Distribution Election under
this Section 5.6(a) (i) may not apply to any amount otherwise payable in 2008
and (ii) may not cause an amount to be paid in 2008 that would not otherwise be
payable in 2008. After December 31, 2008, this Distribution Election may be
changed only as provided in Section 5.6(b).

(b) A Participant may change the form or timing of the distribution of the
Participant’s Account (based on the choices available under Section 5.2) by
filing a new Distribution Election with the Administrator; provided that such
change meets the requirements of Code Section 409A(a)(4)(C) and the Treasury
Regulations promulgated thereunder, including the following requirements:
(i) the subsequent Distribution Election may not take effect until at least
twelve (12) months after the date on which such election is made, (ii) the
payment with respect to which such Distribution Election is made must be
deferred (other than a distribution upon death or Disability) for a period of
not less than five (5) years from the date the first amount was scheduled to be
paid, and (iii) any subsequent Distribution Election affecting a distribution at
a specified time (or pursuant to a fixed schedule) may not be made less than
twelve (12) months before the date the first amount was scheduled to be paid. A
subsequent Distribution Election may be changed at any time before the last
permissible date for making such election, as described in this Section 5.6(b).

(c) Once distributions to a Participant begin, no changes to the Participant’s
Distribution Election shall be permitted.

(d) For purposes of this Section 5.6, a series of installment payments paid from
an Account shall be treated as a single payment.

ARTICLE 6—BENEFICIARIES

 

6.1 Beneficiaries.

Each Participant may from time to time designate one or more persons (who may be
any one or more members of such person’s family or other persons,
administrators, trusts, foundations or other entities) as his or her beneficiary
under the Plan. Such designation shall be made in a form prescribed by the
Administrator. Each Participant may at any time and from time to time, change
any previous beneficiary designation, without notice to or consent of any
previously designated beneficiary, by amending his or her previous designation
in a form prescribed by the Administrator. If the beneficiary does not survive
the Participant (or is

 

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otherwise unavailable to receive payment) or if no beneficiary is validly
designated, then the amounts payable under this Plan shall be paid to the
Participant’s surviving spouse or, if there is no surviving spouse, the
Participant’s estate. If more than one person is the beneficiary of a deceased
Participant, each such person shall receive a pro rata share of any death
benefit payable unless otherwise designated in the applicable form. If a
beneficiary who is receiving benefits dies, all benefits that were payable to
such beneficiary shall then be payable to the estate of that beneficiary.

 

6.2 Lost Participant and/or Beneficiary.

All Participants and beneficiaries shall have the obligation to keep the
Administrator informed of their current address until such time as all benefits
due have been paid. Under no circumstances shall any amount under this Plan
escheat to any governmental authority.

ARTICLE 7—FUNDING

 

7.1 Prohibition Against Funding.

Should any investment be acquired by the Company in connection with the
liabilities assumed under this Plan, it is expressly understood and agreed that
the Participants and beneficiaries shall not have any right with respect to, or
claim against, such assets nor shall any such purchase be construed to create a
trust of any kind or a fiduciary relationship between the Company and the
Participants, their beneficiaries or any other person. Any such assets shall be
and remain a part of the general, unpledged, unrestricted assets of the Company,
subject to the claims of their general creditors. It is the express intention of
the parties hereto that this arrangement shall be unfunded for tax purposes.
Each Participant and beneficiary shall be required to look to the provisions of
this Plan and to the Company itself for enforcement of any and all benefits due
under this Plan, and to the extent any such person acquires a right to receive
payment under this Plan, such right shall be no greater than the right of any
unsecured general creditor of the Company. The Company shall be designated the
owner and beneficiary of any investment acquired in connection with its
obligations under this Plan.

 

7.2 Withholding of Annual Fees.

The Administrator is authorized to make any and all necessary arrangements with
the Company in order to withhold the Participant’s Deferrals under Section 3.1
hereof from his or her Annual Fees. The Administrator shall determine the amount
and timing of such withholding.

ARTICLE 8—CLAIMS ADMINISTRATION

 

8.1 General.

If a Participant, beneficiary or his or her representative (the “claimant”) is
denied all or a portion of an expected Plan benefit for any reason and the
claimant desires to dispute the decision of the Administrator, he or she must
file a written notification of his or her claim with the Administrator.

 

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8.2 Claims Procedure.

Upon receipt of any written claim for benefits, the Administrator shall be
notified and shall give due consideration to the claim presented. If any
claimant claims to be entitled to benefits under the Plan and the Administrator
determines that the claim should be denied in whole or in part, the
Administrator shall, in writing, notify such claimant within ninety (90) days of
receipt of the claim, or for a claim on account of Disability, within forty-five
(45) days of the receipt of such claim, that the claim has been denied. The
Administrator may extend the period of time for making a determination with
respect to any claim for a period of up to ninety (90) days, or if the claim is
on account of Disability, for a period of not more than two additional thirty
(30) day periods, provided that the Administrator determines that such an
extension is necessary because of special circumstances and notifies the
claimant, prior to the expiration of the initial forty-five (45) day or ninety
(90) day period, of the circumstances requiring the extension of time and the
date by which the Plan expects to render a decision. If the claim is denied to
any extent by the Administrator, the Administrator shall furnish the claimant
with a written notice setting forth:

(a) the specific reason or reasons for denial of the claim;

(b) a specific reference to the Plan provisions on which the denial is based;

(c) a description of any additional material or information necessary for the
claimant to perfect the claim and an explanation of why such material or
information is necessary;

(d) An explanation of the Plan’s claims review procedure and the time limits
applicable to such procedure; and a statement of the claimant’s right to bring a
civil action under ERISA Section 502(a) following an adverse determination upon
review; and

(e) In the case of an adverse determination of a claim on account of Disability,
the information to the claimant shall include, to the extent necessary, the
information set forth in Department of Labor Regulation 2560.503-1(g)(1)(v).

Under no circumstances shall any failure by the Administrator to comply with the
provisions of this Section 8.2 be considered to constitute an allowance of the
claimant’s claim.

 

8.3 Right of Appeal.

A claimant who has a claim denied wholly or partially under Section 8.2 may
appeal to the Administrator for reconsideration of that claim. A request for
reconsideration under this Section must be filed by written notice within sixty
(60) days after receipt by the claimant of the notice of denial under
Section 8.2 (or one hundred eighty (180) days in the case of a denial of a claim
on account of Disability).

 

8.4 Review of Appeal.

Upon receipt of an appeal, the Administrator shall promptly take action to give
due consideration to the appeal. Such consideration may include a hearing of the
parties involved, if the Administrator feels such a hearing is necessary. In
preparing for this appeal, the claimant

 

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shall be given the right to review pertinent documents and the right to submit
in writing a statement of issues and comments. After consideration of the merits
of the appeal, the Administrator shall issue a written decision which shall be
binding on all parties. The decision shall specifically state its reasons and
pertinent Plan provisions on which it relies. The Administrator’s decision shall
be issued within sixty (60) days (forty-five (45) days in the case of a claim on
account of Disability) after the appeal is filed, except that the Administrator
may extend the period of time for making a determination with respect to any
claim for a period of up to sixty (60) additional days (or for a period up to
forty-five (45) additional days in the case of a claim on account of
Disability), provided that the Administrator determines that such an extension
is necessary because of special circumstances and notifies the claimant, prior
to the expiration of the initial forty-five (45) day or sixty (60) day period,
of the circumstances requiring the extension of time and the date by which the
Plan expects to render a decision. Under no circumstances shall any failure by
the Administrator to comply with the provisions of this Section 8.4 be
considered to constitute an allowance of the claimant’s appeal.

In the case of a claim on account of Disability: (a) the review of the denied
claim shall be conducted by a named fiduciary who is neither the individual who
made the benefit determination nor a subordinate of such person; and (b) no
deference shall be given to the initial benefit determination. For issues
involving medical judgment, the named fiduciary must consult with an independent
health care professional who may not be the health care professional who decided
the initial claim.

To the extent permitted by law, the decision of the claims official (if no
review is properly requested) or the decision of the review official on review,
as the case may be, will be final and binding on all parties. No legal action
for benefits under the Plan will be brought unless and until the claimant has
exhausted his or her remedies under this section.

 

8.5 Designation.

To the extent permitted by this Article, the Administrator may designate any
other person of its choosing to make any determination otherwise required under
this Article. Any person so designated shall have the same authority and
discretion granted to the Administrator hereunder.

ARTICLE 9—GENERAL PROVISIONS

 

9.1 Administrator.

(a) The Administrator is expressly empowered to limit the amount of the
Deferrals permitted under the Plan; to interpret the Plan, and to determine all
questions arising in the administration, interpretation and application of the
Plan; to employ actuaries, accountants, counsel, and other persons it deems
necessary in connection with the administration of the Plan; to request any
information from the Company it deems necessary to determine whether the Company
would be considered insolvent or subject to a proceeding in bankruptcy; and to
take all other necessary and proper actions to fulfill its duties as
Administrator.

(b) The Administrator shall not be liable for any actions by it hereunder,
unless due to its own gross negligence, willful misconduct or lack of good
faith.

 

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(c) The Administrator shall be indemnified and saved harmless by the Company
from and against all personal liability to which it may be subject by reason of
any act done or omitted to be done in its official capacity as Administrator in
good faith in the administration of the Plan, including all expenses reasonably
incurred in its defense in the event the Company fails to provide such defense
upon the request of the Administrator. The Administrator is relieved of all
responsibility in connection with its duties hereunder to the fullest extent
permitted by law.

 

9.2 No Assignment.

Benefits or payments under this Plan shall not be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment, or garnishment by creditors of the Participant or the Participant’s
beneficiary, whether voluntary or involuntary, and any attempt to so anticipate,
alienate, sell, transfer, assign, pledge, encumber, attach or garnish the same
shall not be valid, nor shall any such benefit or payment be in any way liable
for or subject to the debts, contracts, liabilities, engagement or torts of any
Participant or beneficiary, or any other person entitled to such benefit or
payment pursuant to the terms of this Plan, except to such extent as may be
required by law. If any Participant or beneficiary or any other person entitled
to a benefit or payment pursuant to the terms of this Plan attempts to
anticipate, alienate, sell, transfer, assign, pledge, encumber, attach or
garnish any benefit or payment under this Plan, in whole or in part, or if any
attempt is made to subject any such benefit or payment, in whole or in part, to
the debts, contracts, liabilities, engagements or torts of the Participant or
beneficiary or any other person entitled to any such benefit or payment pursuant
to the terms of this Plan, then such attempt shall be invalid.

 

9.3 No Service Rights.

Participation in this Plan shall not be construed to confer upon any Participant
the legal right to be retained in the service of the Company, or give a
Participant or beneficiary, or any other person, any right to any payment
whatsoever, except to the extent of the benefits provided for hereunder. Each
Participant shall remain subject to discharge to the same extent as if this Plan
had never been adopted.

 

9.4 Incompetence.

If the Administrator determines that any person to whom a benefit is payable
under this Plan is incompetent by reason of physical or mental disability, the
Administrator shall have the power to cause the payments becoming due to such
person to be made to another for his or her benefit without responsibility of
the Administrator or the Company to see to the application of such payments. Any
payment made pursuant to such power shall, as to such payment, operate as a
complete discharge of the Company and the Administrator.

 

9.5 Other Benefits.

The benefits of each Participant or beneficiary hereunder shall be in addition
to any benefits paid or payable to or on account of the Participant or
beneficiary under any other pension, disability, annuity or retirement plan or
policy whatsoever.

 

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9.6 Right of Setoff.

The Company may, to the extent permitted by applicable law, deduct from and
setoff against any amounts payable to a Participant or a beneficiary from this
Plan such amounts as may be owed by the Participant to the Company, although the
Participant shall remain liable for any part of the Participant’s payment
obligation not satisfied through such deduction and setoff; provided, however,
that this setoff may occur only at the date on which the amount would otherwise
be distributed to the Participant or beneficiary under Article 5. By
participating in the Plan and deferring compensation hereunder, the Participant
agrees to any deduction or setoff under this Section 9.6.

 

9.7 Expenses.

All expenses incurred in the administration of the Plan, whether incurred by the
Company or the Plan, shall be paid by the Company.

 

9.8 Tax Withholding.

Each Participant is responsible for payment of any federal, state and local
income, employment and wage taxes associated with his or her participation in
the Plan and the Company will not withhold any amounts in advance payment of
these taxes.

 

9.9 Amendment, Modification, Suspension or Termination.

(a) The Company may, at any time, in its sole discretion, amend, modify, suspend
or terminate the Plan in whole or in part, except that no such amendment,
modification, suspension or termination shall have any retroactive effect to
reduce any amounts allocated to a Participant’s Account. Except as otherwise
provided in Section 9.9(b) or 9.9(c), in the event that this Plan is terminated,
the distribution of the amounts credited to a Participant’s Account shall not be
accelerated but shall be paid at such time and in such manner as determined
under the terms of the Plan immediately prior to termination as if the Plan had
not been terminated.

(b) Notwithstanding anything to the contrary contained herein, the Company, in
its sole discretion, may distribute all Participants’ Accounts in connection
with a termination of the Plan in accordance with Treasury Regulation Sections
1.409A-3(j)(4)(ix)(A), (C) and (D).

(c) The Company may decide in its discretion to terminate the Plan within the
thirty (30) days preceding or the twelve (12) months following a Change in
Control; provided that (i) all Accounts under the Plan are distributed within
twelve (12) months of the termination date of the Plan, and (ii) all other
requirements under Treasury Regulation Section 1.409A-3(j)(4)(ix)(B) are met.

 

9.10 Successors.

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

 

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9.11 Construction.

All questions of interpretation, construction or application arising under or
concerning the terms of this Plan shall be decided by the Administrator, in its
sole and final discretion, whose decision shall be final, binding and conclusive
upon all persons.

 

9.12 Governing Law.

This Plan shall be governed by, construed and administered in accordance with
the applicable provisions of the Code and any other applicable federal law,
provided, however, that to the extent not preempted by federal law this Plan
shall be governed by, construed and administered under the laws of the State of
Delaware, other than its laws respecting choice of law.

 

9.13 Severability.

If any provision of this Plan is held invalid or unenforceable, its invalidity
or unenforceability shall not affect any other provision of this Plan and this
Plan shall be construed and enforced as if such provision had not been included
therein. If the inclusion of any Director (or Directors) as a Participant under
this Plan would cause the Plan to fail to comply with Code Section 409A, then
the Plan shall be severed with respect to such Director or Directors, who shall
be considered to be participating in a separate arrangement.

 

9.14 Headings.

The Article headings contained herein are inserted only as a matter of
convenience and for reference and in no way define, limit, enlarge or describe
the scope or intent of this Plan nor in any way shall they affect this Plan or
the construction of any provision thereof.

 

9.15 Terms.

Capitalized terms shall have meanings as defined herein. Singular nouns shall be
read as plural, masculine pronouns shall be read as feminine, and vice versa, as
appropriate.

 

9.16 Code Section 409A Compliance.

It is intended that this Plan comply with Code Section 409A and the Treasury
Regulations promulgated thereunder (and any subsequent IRS notices or guidance),
and this Plan will be interpreted, administered and operated accordingly.
Nothing herein shall be construed as an entitlement to or guarantee of any
particular tax treatment to a Participant.

 

9.17 Payments Upon Income Inclusion Under Code Section 409A.

The Company may accelerate the time or schedule of a payment to a Participant to
pay an amount the Participant includes in income as a result of the Plan failing
to meet the requirements of Code Section 409A and the Treasury Regulations
promulgated thereunder. Such payment may not exceed the amount required to be
included in income as a result of the failure to comply with Code Section 409A
and the Treasury Regulations promulgated thereunder.

 

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IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its
duly authorized officer, effective as of this      day of         , 20    .

 

TIM HORTONS INC. By:  

 

Title:  

 

By:  

 

Title:  

 

 

ATTEST:

By:

 

 

Title:

 

 

 

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TIM HORTONS INC.

U.S. NON-EMPLOYEE DIRECTORS’ DEFERRED COMPENSATION PLAN

AS AMENDED AND RESTATED EFFECTIVE AS OF JANUARY 1, 2008

EXHIBIT A

DEFINITION OF CHANGE IN CONTROL

Provided that such definition shall be interpreted in a manner that is
consistent with the definition of “change in control event” under Code
Section 409A and Treasury Regulation Section 1.409A-3(i)(5), a “Change in
Control” shall mean the first to occur of any of the following:

(a) the date that any one person, or more than one person acting as a group,
acquires ownership of stock of the Company that, together with stock held by
such person or group, constitutes more than fifty percent (50%) of the total
fair market value or total voting power of the stock of the Company;

(b) the date that any one person, or more than one person acting as a group,
acquires (or has acquired during the twelve (12) month period ending on the date
of the most recent acquisition by such person or persons) ownership of stock of
the Company possessing thirty percent (30%) or more of the total voting power of
the stock of the Company;

(c) the date that any one person, or more than one person acting as a group,
acquires (or has acquired during the twelve (12) month period ending on the date
of the most recent acquisition by such person or persons) assets from the
Company that have a total gross fair market value equal to or more than forty
percent (40%) of the total gross fair market value of all of the assets of the
Company immediately before such acquisition or acquisitions; or

(d) the date that a majority of the members of the Board of Directors of the
Company is replaced during any twelve (12) month period by directors whose
appointment or election is not endorsed by a majority of the members of the
Board of Directors of the Company before the date of the appointment or
election.