FARO TECHNOLOGIES, INC.
2004 EQUITY INCENTIVE PLAN
 
AMENDED AND RESTATED
NOVEMBER 20, 2008
 
Section 1. Purpose
 
The purpose of the FARO Technologies, Inc. 2004 Equity Incentive Plan (the
“Plan”) is to promote the best interests of FARO Technologies, Inc. (together
with any successor thereto, the “Company”) and its shareholders by providing
Employees and non-employee directors of the Company and its Affiliates (as
defined below) with an opportunity to acquire a proprietary interest in the
Company. It is intended that the Plan will promote continuity of management and
increased incentive and personal interest in the welfare of the Company by those
Employees who are primarily responsible for shaping and carrying out the
long-range plans of the Company and securing the Company’s continued growth and
financial success. In addition, by encouraging stock ownership by directors who
are not employees of the Company or its Affiliates, the Company seeks to attract
and retain on its Board of Directors persons of exceptional competence and to
provide a further incentive to serve as a director of the Company.
 
Section 2. Definitions
 
As used in the Plan, the following terms shall have the respective meanings set
forth below:
 
(a) “Affiliate” shall mean any entity that, directly or through one or more
intermediaries, is controlled by, controls, or is under common control with, the
Company.
 
(b) “Award” shall mean any Option, Stock Appreciation Right, Restricted Stock,
Restricted Stock Unit, Performance Share or Performance Unit granted under the
Plan.
 
(c) “Award Agreement” shall mean any written agreement, contract, or other
instrument or document evidencing any Award granted under the Plan.
 
(d) “Board” means the Board of Directors of the Company.
 
(e) “Change in Control” means the occurrence of any one of the following events:
 
(i) individuals who, as of November 20, 2008, constitute the Board (the
“Incumbent Directors”) cease for any reason to constitute at least a majority of
the Board or other governing body or entity of the Company, its successor or
survivor, provided that any person becoming a director subsequent to November
20, 2008 but prior to any Change in Control, whose election or nomination for
election was approved or recommended by a vote of a majority of the Incumbent
Directors then on the Board (either by a specific vote or by approval of the
proxy statement of the Company in which such person is named as a nominee for
director, without written objection to such nomination), shall be an Incumbent
Director; provided, however, that no individual initially elected or nominated
as a director of the Company as a result of an actual or threatened election
contest with respect to directors or as a result of any other actual or
threatened solicitation of proxies or consents by or on behalf of any person
other than the Board shall be deemed to be an Incumbent Director;
 
 
 

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(ii) any person is or becomes an owner or beneficial owner, directly or
indirectly, of securities of the Company representing 40% or more of the
combined voting power of the Company’s then outstanding securities eligible to
vote generally in the election of directors (the “Company Voting Securities”);
provided, however, that the event described in this subsection (ii) shall not be
deemed to be a Change in Control by virtue of any of the following acquisitions:
(A) by the Company or any Subsidiary, (B) by any employee benefit plan (or
related trust) sponsored or maintained by the Company or any Subsidiary, (C) by
any underwriter temporarily holding securities pursuant to an offering of such
securities, (D) pursuant to a Non-Qualifying Transaction (as defined in
subsection (iii) below), (E) pursuant to any acquisition by the Participant or
any group of persons including the Participant (or any entity controlled by the
Participant or any group of persons including the Participant), or (F) through a
transaction (other than one described in subsection (iii) below) in which
Company Voting Securities are acquired from the Company, if a majority of the
Incumbent Directors approve a resolution providing expressly that the
acquisition pursuant to this clause (F) does not constitute a Change in Control
under this subsection (ii);
 
(iii) the consummation of a merger, consolidation, statutory share exchange,
reorganization, sale of all or substantially all the Company’s assets or similar
form of corporate transaction involving the Company or any of its Subsidiaries
that requires the approval of the Company’s shareholders, whether for such
transaction or the issuance of securities in the transaction (a “Business
Combination”), unless immediately following such Business Combination: (A) at
least 50% of the total voting power of the corporation or other entity resulting
from, or succeeding to the interests of the Company in, such Business
Combination (or, if applicable, the ultimate parent entity that has the power to
elect a majority of the directors of such corporation or other entity) (the
“Surviving Corporation”) is represented by Company Voting Securities that were
outstanding immediately prior to such Business Combination (or, if applicable,
is represented by shares into which such Company Voting Securities were
converted pursuant to such Business Combination), and such voting power among
the holders thereof is in substantially the same proportion as the voting power
of such Company Voting Securities among the holders thereof immediately prior to
the Business Combination, (B) no person (other than any employee benefit plan
(or related trust) sponsored or maintained by the Surviving Corporation) is or
becomes the owner or beneficial owner, directly or indirectly, of 40% or more of
the total voting power of the outstanding voting securities eligible to elect
directors of the Surviving Corporation, and (C) at least a majority of the
members of the board of directors of the Surviving Corporation following the
consummation of the Business Combination were Incumbent Directors at the time of
the Board’s approval of the execution of the initial agreement providing for
such Business Combination; any Business Combination which satisfies all of the
criteria specified in (A), (B) and (C) above shall be deemed to be a
“Non-Qualifying Transaction”; or
 
(iv) the shareholders of the Company approve a plan of complete liquidation or
dissolution of the Company.
 
Notwithstanding the foregoing, (A) a Change in Control shall not be deemed to
occur solely because any person acquires beneficial ownership of more than 40%
of the Company Voting Securities as a result of the acquisition of Company
Voting Securities by the Company or its affiliates which reduces the number of
Company Voting Securities outstanding; provided, that if after the consummation
of such acquisition by the Company such person becomes the beneficial owner of
additional Company Voting Securities that increases the percentage of
outstanding Company Voting Securities beneficially owned by such person, a
Change in Control of the Company shall then occur and (B) with respect to an
Award that is considered deferred compensation subject to Code Section 409A, if
the definition of Change in Control results in the payment of such Award, then
such definition shall be amended to the minimum extent necessary, if at all, so
that the definition satisfies the requirements of a change of control under Code
Section 409A.
 
 
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For purposes of this Change in Control definition, “corporation” shall include
any limited liability company, partnership, association, business trust and
similar organization, and “board of directors” shall refer to the ultimate
governing body of such organization and “director” shall refer to any member of
such governing body.
 
(f) “Code” shall mean the Internal Revenue Code of 1986, as amended from time to
time. Any reference to a specific provision of the Code shall also be deemed a
reference to any successor provision thereto.
 
(g) “Commission” shall mean the United States Securities and Exchange Commission
or any successor agency.
 
(h) “Committee” shall mean a committee of the Board designated by such Board to
administer the Plan and comprised solely of not less than two directors, each of
whom will be a “non-employee director” within the meaning of Rule 16b-3 and each
of whom will be an “outside director” within the meaning of Section 162(m)(4)(C)
of the Code; provided that the mere fact that the Committee shall fail to
qualify under the foregoing requirements shall not invalidate any Award made by
the Committee that is otherwise validly made under the Plan, unless the
Committee is aware at the time of the Award’s grant of the Committee’s failure
to so qualify.
 
(i) “Covered Executive” shall mean each employee of the Company or any
Subsidiary who, on the date a Change in Control occurs, is covered by the
Company’s Change in Control Severance Policy (as identified in the Company’s
Change in Control Severance Policy) or any successor policy thereto.
 
(j) “Dividend Equivalent” shall mean a right, granted to a Participating
Employee or a Non-Employee Director under the Plan, to receive cash equal to the
cash dividends paid with respect to a specified number of Shares. Dividend
Equivalents shall not be deemed to be Awards under the Plan.
 
(k) “Employee” shall mean any employee of the Company or any Subsidiary.
 
(l) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended
from time to time.
 
(m) “Excluded Items” shall mean any items which the Committee determines shall
be excluded in fixing Performance Goals, including, without limitation, any
gains or losses from discontinued operations, any extraordinary gains or losses
and the effects of accounting changes.
 
 
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(n) “Fair Market Value” shall mean, with respect to any property (including,
without limitation, any Shares or other securities), the fair market value of
such property determined by such methods or procedures as shall be established
from time to time by the Committee.
 
(o) “Incentive Stock Option” shall mean an option granted under Section 6(a) of
the Plan that is intended to meet the requirements of Section 422 of the Code.
 
(p) “Non-Employee Director” shall mean a member of the Board of Directors of the
Company who is not an employee of the Company or any Affiliate.
 
(q) “Non-Qualified Stock Option” shall mean an option granted under Section 6(a)
of the Plan that is not intended to be an Incentive Stock Option.
 
(r) “Option” shall mean an Incentive Stock Option or a Non-Qualified Stock
Option.
 
(s) “Participant” shall mean each of the Non-Employee Directors and Covered
Executives designated by the Committee to be granted an Award under the Plan.
 
(t) “Participating Employee” shall mean a Employee designated by the Committee
to be granted an Award under the Plan.
 
(u) “Performance Goals” shall mean each of, or a combination of one or more of,
the following (in all cases after excluding the impact of applicable Excluded
Items):
 
(i) Return on equity;
 
(ii) Return on investment;
 
(iii) Return on net assets;
 
(iv) Return on revenues;
 
(v) Operating income;
 
(vi) Performance value added (as defined by the Committee at the time of
selection);
 
(vii) Pre-tax profits;
 
(viii) Net income;
 
(ix) Net income per Share;
 
(x) Working capital as a percent of net revenues;
 
(xi) Net cash provided by operating activities;
 
(xii) Market price per Share;
 
 
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(xiii) Total shareholder return;
 
(xiv) Key operational measures, which shall be deemed to include new customer
origination, customer penetration, customer satisfaction, employee safety,
market share, plant utilization, cost containment, and cost structure reduction.
 
(xv) Cash flow or cash flow per share;
 
(xvi) Reserve value or reserve value per share;
 
(xvii) Net asset value or net asset value per share;
 
(xviii) Production volumes; and
 
(xix) Product and technology developments and improvements.
 
measured in each case for the Performance Period (aa) for the Company on a
consolidated basis, (bb) for any one or more Affiliates or divisions of the
Company, where appropriate, and/or (cc) for any other business unit or units of
the Company or any Affiliate, where appropriate, as defined by the Committee at
the time of selection; provided that it shall only be appropriate to measure net
earnings per Share and market price per Share on a consolidated basis.
 
(v) “Performance Period” shall mean, in relation to Performance Shares or
Performance Units, any period for which a Performance Goal or Goals have been
established; provided, however, that such period shall not be less than one
year.
 
(w) “Performance Share” shall mean any right granted under Section 6(e) of the
Plan that will be paid out in cash, as a Share (which, in specified
circumstances, may be a Share of Restricted Stock) or as a Restricted Stock
Unit, which right is contingent on the achievement of one or more Performance
Goals during a specified Performance Period.
 
(x) “Performance Unit” shall mean any right granted under Section 6(e) of the
Plan to receive a designated dollar value amount in cash, Shares (which, in
specified circumstances, may be a designated dollar value amount of Shares of
Restricted Stock) or Restricted Stock Units, which right is contingent on the
achievement of one or more Performance Goals during a specified Performance
Period.
 
(y) “Person” shall mean any individual, corporation, partnership, association,
joint-stock company, trust, unincorporated organization, or government or
political subdivision thereof.
 
(z) “Released Securities” shall mean Shares of Restricted Stock with respect to
which all applicable restrictions have expired, lapsed, or been waived.
 
(aa) “Restricted Securities” shall mean Awards of Restricted Stock or other
Awards under which issued and outstanding Shares are held subject to certain
restrictions.
 
(bb) “Restricted Stock” shall mean any Share granted under Section 6(c) of the
Plan or, in specified circumstances, a Share paid in connection with another
Award, with such Share subject to risk of forfeiture and restrictions on
transfer or other restrictions that will lapse upon the achievement of one or
more goals relating to completion of service by the Employee or Non-Employee
Director or the achievement of performance or other objectives, as determined by
the Committee.
 
 
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(cc) “Restricted Stock Unit” shall mean any right to receive Shares in the
future granted under Section 6(d) of the Plan or paid in connection with another
Award, with such right subject to risk of forfeiture and restrictions on
transfer or other restrictions that will lapse upon the achievement of one or
more goals relating to completion of service by the Employee or Non-Employee
Director or the achievement of performance or other objectives, as determined by
the Committee.
 
(dd) “Rule 16b-3” shall mean Rule 16b-3 as promulgated by the Commission under
the Exchange Act, or any successor rule or regulation thereto.
 
(ee) “Shares” shall mean shares of common stock of the Company, $.001 par value,
and such other securities or property as may become subject to Awards pursuant
to an adjustment made under Section 4(b) of the Plan.
 
(ff) “Stock Appreciation Right” shall mean any right granted under Section 6(b)
of the Plan.
 
(gg) “Subsidiary” shall mean any corporation or other entity in which the
Company has a direct or indirect ownership interest of 50% or more of the total
combined voting power of the then-outstanding securities or interests of such
corporation or other entity entitled to vote generally in the election of
directors (or members of any similar governing body) or in which the Company has
the right to receive 50% or more of the distribution of profits or 50% of the
assets or liquidation or dissolution.
 
Section 3. Administration
 
The Plan shall be administered by the Committee; provided, however, that if at
any time the Committee shall not be in existence, the functions of the Committee
as specified in the Plan shall be exercised by a committee consisting of those
members of the Board who qualify as “non-employee directors” under Rule 16b-3
and as “outside directors” under Section 162(m)(4)(C) of the Code. To the extent
permitted by applicable law, the Committee may delegate to one or more executive
officers of the Company any or all of the authority and responsibility of the
Committee with respect to the Plan, other than with respect to Persons who are
subject to Section 16 of the Exchange Act. To the extent the Committee has so
delegated to one or more executive officers the authority and responsibility of
the Committee, all references to the Committee herein shall include such officer
or officers.
 
 
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Subject to the terms of the Plan and without limitation by reason of
enumeration, the Committee shall have full discretionary power and authority to:
(i) designate Participating Employees and select Non-Employee Directors to be
participants under the Plan; (ii) determine the type or types of Awards to be
granted to each Participating Employee and Non-Employee Director under the Plan;
(iii) determine the number of Shares to be covered by (or with respect to which
payments, rights, or other matters are to be calculated in connection with)
Awards granted to Participating Employees or Non-Employee Directors;
(iv) determine the terms and conditions of any Award granted to a Participating
Employee or Non-Employee Director (provided, however, that the exercise price of
any Option shall not be less than 100% of the Fair Market Value of a Share on
the date of grant of such Option); (v) determine whether, to what extent, and
under what circumstances Awards granted to Participating Employees or
Non-Employee Directors may be settled or exercised in cash, Shares, other
securities, other Awards, or other property, and the method or methods by which
Awards may be settled, exercised, cancelled, forfeited, or suspended;
(vi) determine whether, to what extent, and under what circumstances cash,
Shares, other Awards, and other amounts payable with respect to an Award granted
to Participating Employees of Non-Employee Directors under the Plan shall be
deferred either automatically or at the election of the holder thereof or of the
Committee; (vii) interpret and administer the Plan and any instrument or
agreement relating to, or Award made under, the Plan (including, without
limitation, any Award Agreement); (viii) establish, amend, suspend, or waive
such rules and regulations and appoint such agents as it shall deem appropriate
for the proper administration of the Plan; and (ix) make any other determination
and take any other action that the Committee deems necessary or desirable for
the administration of the Plan. Unless otherwise expressly provided in the Plan,
all designations, determinations, interpretations, and other decisions under or
with respect to the Plan or any Award shall be within the sole discretion of the
Committee, may be made at any time, and shall be final, conclusive, and binding
upon all Persons, including the Company, any Affiliate, any Participating
Employee, any Non-Employee Director, any holder or beneficiary of any Award, any
shareholder, and any employee of the Company or of any Affiliate.
 
Section 4. Shares Available for Award
 
(a) Shares Available. Subject to adjustment as provided in Section 4(b):
 
(i) Number of Shares Available. The number of Shares with respect to which
Awards may be granted under the Plan shall be 1,750,000 Shares. If, after the
effective date of the Plan, any Shares covered by an Award granted under the
Plan, or to which any Award relates, are forfeited or if an Award otherwise
terminates, expires or is cancelled prior to the delivery of all of the Shares
or of other consideration issuable or payable pursuant to such Award, then the
number of Shares counted against the number of Shares available under the Plan
in connection with the grant of such Award, to the extent of any such
forfeiture, termination, expiration or cancellation, shall again be available
for granting of additional Awards under the Plan.
 
(ii) Limitations on Awards to Individual Participants. No Participating Employee
shall be granted, during any calendar year, Options for more than 150,000
Shares, Stock Appreciation Rights with respect to more than 150,000 Shares, more
than 105,000 Shares of Restricted Stock, more than 105,000 Restricted Stock
Units, more than 105,000 Performance Shares nor more than 105,000 Performance
Units under the Plan. In all cases, determinations under this Section 4(a)(ii)
shall be made in a manner that is consistent with the exemption for
performance-based compensation provided by Section 162(m) of the Code and any
regulations promulgated thereunder.
 
(iii) Accounting for Awards. The number of Shares covered by an Award under the
Plan, or to which such Award relates, shall be counted on the date of grant of
such Award against the number of Shares available for granting Awards under the
Plan.
 
 
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(iv) Sources of Shares Deliverable Under Awards. Any Shares delivered pursuant
to an Award may consist, in whole or in part, of authorized and unissued Shares
or of treasury Shares.
 
(b) Adjustments. In the event that the Committee shall determine that any
dividend or other distribution (whether in the form of cash, Shares, other
securities, or other property), recapitalization, stock split, reverse stock
split, reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase, or exchange of Shares or other securities of the Company, issuance
of warrants or other rights to purchase Shares or other securities of the
Company, or other similar corporate transaction or event affects the Shares such
that an adjustment is determined by the Committee to be appropriate, then the
Committee may, in such manner as it may deem equitable, adjust any or all of (i)
the number and type of Shares subject to the Plan and which thereafter may be
made the subject of Awards under the Plan, (ii) the number and type of Shares
subject to the individual participant limits of Section 4(a)(ii), (iii) the
number and type of Shares subject to outstanding Awards, and (iv) the grant,
purchase, or exercise price with respect to any Award to reflect such
transaction or event; or, if deemed appropriate, make provision for a cash
payment to the holder of an outstanding Award in exchange for cancellation of
such Award or in lieu of any or all of the foregoing adjustments; provided,
however, in each case, that with respect to Awards of Incentive Stock Options no
such adjustment shall be authorized to the extent that such authority would
cause the Plan to violate Section 422(b) of the Code; and provided further that
the number of Shares subject to any Award payable or denominated in Shares shall
always be a whole number.
 
Section 5. Eligibility
 
The Committee may designate any Employee as a Participating Employee. All
Non-Employee Directors shall be eligible to receive, at the discretion of the
Committee, Awards of Non-Qualified Stock Options pursuant to Section 6(a),
Restricted Stock pursuant to Section 6(c) and Restricted Stock Units pursuant to
Section 6(d).
 
Section 6. Awards
 
(a) Option Awards. The Committee may grant Options to Employees and Non-Employee
Directors with the terms and conditions as set forth below and with such
additional terms and conditions, in either case not inconsistent with the
provisions of the Plan, as the Committee shall determine.
 
(i) Type of Option. The Committee shall determine whether an Option granted to a
Participating Employee is to be an Incentive Stock Option or Non-Qualified Stock
Option; provided, however, that Incentive Stock Options may be granted only to
Employees of the Company, a parent corporation (within the meaning of Code
Section 424(e)) or a subsidiary corporation (within the meaning of Code Section
424(f)). All Options granted to Non-Employee Directors shall be Non-Qualified
Stock Options.
 
(ii) Exercise Price. The exercise price per Share of an Option granted pursuant
to this Section 6(a) shall be determined by the Committee; provided, however,
that such exercise price shall not be less than 100% of the Fair Market Value of
a Share on the date of grant of such Option.
 
 
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(iii) Option Term. The term of each Option shall be fixed by the Committee;
provided, however, that in no event shall the term of any Option exceed a period
of ten years from the date of its grant.
 
(iv) Exercisability and Method of Exercise. An Option shall become exercisable
in such manner and within such period or periods and in such installments or
otherwise as shall be determined by the Committee; provided, however, that
except as provided in Section 6(f) below, no Option may vest and become
exercisable within a period that is less than one year from the date of grant of
such Option. The Committee also shall determine the method or methods by which,
and the form or forms, including, without limitation, cash, Shares, other
securities, other Awards, or other property, or any combination thereof, having
a Fair Market Value on the exercise date equal to the relevant exercise price,
in which payment of the exercise price with respect to any Option may be made or
deemed to have been made.
 
(v) Incentive Stock Options. The terms of any Incentive Stock Option granted to
a Employee under the Plan shall comply in all respects with the provisions of
Section 422 of the Code and any regulations promulgated thereunder.
Notwithstanding any provision in the Plan to the contrary, no Incentive Stock
Option may be granted hereunder after the tenth anniversary of the adoption of
the Plan by the Board.
 
(b) Stock Appreciation Rights. The Committee may grant Stock Appreciation Rights
to Employees. Non-Employee Directors are not eligible to be granted Stock
Appreciation Rights under the Plan. Subject to the terms of the Plan and any
applicable Award Agreement, a Stock Appreciation Right granted under the Plan
shall confer on the holder thereof a right to receive, upon exercise thereof,
the excess of (i) the Fair Market Value of one Share on the date of exercise
over (ii) the grant price of the Stock Appreciation Right as specified by the
Committee, which shall not be less than 100% of the Fair Market Value of one
Share on the date of grant of the Stock Appreciation Right. Subject to the terms
of the Plan, the grant price, term, methods of exercise, methods of settlement
(including whether the Participating Employee will be paid in cash, Shares,
other securities, other Awards, or other property, or any combination thereof),
and any other terms and conditions of any Stock Appreciation Right shall be
determined by the Committee. The Committee may impose such conditions or
restrictions on the exercise of any Stock Appreciation Right as it may deem
appropriate.
 
(c) Restricted Stock Awards.
 
(i) Issuance. The Committee may grant Awards of Restricted Stock to Employees
and Non-Employee Directors.
 
(ii) Restrictions. Shares of Restricted Stock granted to Participating Employees
and Non-Employee Directors shall be subject to such restrictions as the
Committee may impose (including, without limitation, any limitation on the right
to vote a Share of Restricted Stock or the right to receive any dividend or
other right or property), which restrictions may lapse separately or in
combination at such time or times, in such installments or otherwise, as the
Committee may deem appropriate.
 
 
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(iii) Registration. Any Restricted Stock granted under the Plan to a
Participating Employee or Non-Employee Director may be evidenced in such manner
as the Committee may deem appropriate, including, without limitation, book-entry
registration or issuance of a stock certificate or certificates. In the event
any stock certificate is issued in respect of Shares of Restricted Stock granted
under the Plan to a Participating Employee or Non-Employee Director, such
certificate shall be registered in the name of the Participating Employee or
Non-Employee Director and shall bear an appropriate legend (as determined by the
Committee) referring to the terms, conditions, and restrictions applicable to
such Restricted Stock.
 
(iv) Payment of Restricted Stock. At the end of the applicable restriction
period relating to Restricted Stock granted to a Participating Employee or
Non-Employee Director, one or more stock certificates for the appropriate number
of Shares, free of restrictions imposed under the Plan, shall be delivered to
the Participating Employee or Non-Employee Director, or, if the Participating
Employee or Non-Employee Director received stock certificates representing the
Restricted Stock at the time of grant, the legends placed on such certificates
shall be removed.
 
(v) Forfeiture. Except as otherwise determined by the Committee, upon
termination of employment of a Participating Employee or service as a director
of a Non-Employee Director (as determined under criteria established by the
Committee) for any reason during the applicable restriction period, all Shares
of Restricted Stock still subject to restriction shall be forfeited by the
Participating Employee or Non-Employee Director; provided, however, that the
Committee may, when it finds that a waiver would be in the best interests of the
Company, waive in whole or in part any or all remaining restrictions with
respect to Shares of Restricted Stock held by a Participating Employee or
Non-Employee Director.
 
(vi) Minimum Period of Service. If the right to become vested in a Restricted
Stock Award granted under this Section 6(c) is conditioned on the completion of
a specified period of service with the Company or its Affiliates, without
achievement of Performance Goals or other performance objectives being required
as a condition of vesting, and without it being granted in lieu of other
compensation, then the required period of service for vesting shall be not less
than three years (subject to acceleration of vesting, to the extent permitted by
the Committee, in the event of the Participating Employee’s or Non-Employee
Director’s death, disability, retirement or involuntary termination or in the
event of a change in control (as defined by the Committee or a Change in Control
as defined herein).
 
(d) Restricted Stock Units.
 
(i) Issuance. The Committee may grant Awards of Restricted Stock Units to
Employees or Non-Employee Directors.
 
(ii) Restrictions. Restricted Stock Units granted to Participating Employees or
Non-Employee Directors shall be subject to such restrictions as the Committee
may impose, which restrictions may lapse separately or in combination at such
time or times, in such installments or otherwise, as the Committee may deem
appropriate.
 
(iii) Payment of Shares. At the end of the applicable restriction period
relating to Restricted Stock Units granted to a Participating Employee or
Non-Employee Director, one or more stock certificates for the number of Shares
equal to the corresponding number of Restricted Stock Units, free of
restrictions imposed under the Plan, shall be delivered to the Participating
Employee or Non-Employee Director.
 
 
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(iv) Forfeiture. Except as otherwise determined by the Committee, upon
termination of employment of a Participating Employee or service as a director
of a Non-Employee Director (as determined under criteria established by the
Committee) for any reason during the applicable restriction period, all unvested
Restricted Stock Units shall be forfeited by the Participating Employee or
Non-Employee Director; provided, however, that the Committee may, when it finds
that a waiver would be in the best interests of the Company, waive in whole or
in part any or all remaining restrictions with respect to Restricted Stock Units
held by a Participating Employee or Non-Employee Director.
 
(v) Minimum Period of Service. If the right to become vested in a Restricted
Stock Unit Award granted under this Section 6(d) is conditioned on the
completion of a specified period of service with the Company or its Affiliates,
without achievement of Performance Goals or other performance objectives being
required as a condition of vesting, and without it being granted in lieu of
other compensation, then the required period of service for vesting shall be not
less than three years (subject to acceleration of vesting, to the extent
permitted by the Committee, in the event of the Participating Employee’s or
Non-Employee Director’s death, disability, retirement or involuntary termination
or in the event of a change in control (as defined by the Committee or a Change
in Control as defined herein).
 
(e) Performance Shares and Performance Units.
 
(i) Issuance. The Committee may grant Awards of Performance Shares and/or
Performance Units to Employees. Non-Employee Directors are not eligible to be
granted Performance Shares or Performance Units under the Plan.
 
(ii) Performance Goals and Other Terms. The Committee shall determine the
Performance Period, the Performance Goal or Goals (and the performance level or
levels related thereto) to be achieved during any Performance Period, the
proportion of payments, if any, to be made for performance between the minimum
and full performance levels for any Performance Goal and, if applicable, the
relative percentage weighting given to each of the selected Performance Goals.
The Committee shall also determine the restrictions applicable to Shares of
Restricted Stock or Restricted Stock Units received upon payment of Performance
Shares or Performance Units if Performance Shares or Performance Units are paid
in such manner, and any other terms, conditions and rights relating to a grant
of Performance Shares or Performance Units. The Committee shall have sole
discretion to choose among the selected Performance Goals set forth in
Section 2(u). Subject to shareholder approval to the extent required to qualify
the Award for the performance-based exemption provided by Section 162(m) of the
Code, the Committee shall have sole discretion to choose Performance Goals in
addition to those set forth in Section 2(u), or alter such Performance Goals.
Notwithstanding the foregoing, in the event the Committee determines it is
advisable to grant Performance Shares or Performance Units which do not qualify
for the performance-based exemption under Section 162(m) of the Code, the
Committee may make such grants without satisfying the requirements thereof.
 
 
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(iii) No Voting Rights. Participating Employees shall have no voting rights with
respect to Performance Shares or Shares underlying Performance Units held by
them during the applicable Performance Period.
 
(iv) Payment. As soon as is reasonably practicable following the end of the
applicable Performance Period, and subject to the Committee certifying in
writing as to the satisfaction of the requisite Performance Goal or Goals if
such certification is required in order to qualify the Award for the
performance-based exemption provided by Section 162(m) of the Code, payment of
earned Performance Shares and/or Performance Units shall be made. The Committee,
in its sole discretion, may pay earned Performance Shares and Performance Units
in the form of cash, Shares (which may be Shares of Restricted Stock),
Restricted Stock Units or a combination of cash, Shares (which may be Shares of
Restricted Stock) and/or Restricted Stock Units, which have an aggregate Fair
Market Value equal to the value of the earned Performance Shares and Shares
underlying earned Performance Units at the close of the applicable Performance
Period. Any Shares of Restricted Stock payable in connection with Performance
Shares or Performance Units shall, pending the expiration, lapse, or waiver of
the applicable restrictions, be evidenced in the manner as set forth in
Section 6(c)(iii) hereof.
 
(f) Accelerated Vesting of Awards.  
 
(i) Upon a Change in Control, all unvested Options, unvested Restricted Stock,
unvested Restricted Stock Units, and other unvested Awards held by any
Participant shall vest and, with respect to Options and other Awards that are to
be exercised, become immediately exercisable and shall be exercisable for a
period ending on the later of (A) the fifth anniversary of the date the Change
in Control occurs or (B) the last date that such Option or other Award would
otherwise be exercisable under the terms of the applicable Award Agreement or
the Plan; provided, that in no event shall any Option or other Award be
exercisable after the expiration of the original term of the Option or other
Award;
 
(ii) Upon the retirement from the Board of a Non-Employee Director following at
least five years of continuous service on the Board, all unvested Options,
unvested Restricted Stock, unvested Restricted Stock Units, and other unvested
Awards held by such Non-Employee Director shall vest and, with respect to
Options and other Awards that are to be exercised, become immediately
exercisable and shall be exercisable for a period ending on the last date that
such Option or other Award would be exercisable under the terms of the
applicable Award Agreement or the Plan; and
 
(iii) The Committee and the Board shall have the authority to provide that any
Award will become fully vested and exercisable automatically upon the
Participating Employee’s or Non-Employee Director’s death, disability,
retirement or involuntary termination or in the event of a change in control (as
defined by the Committee or a Change in Control as defined herein), and the
acceleration of vesting an exercisability of such Award shall be governed by the
terms of the applicable Award Agreement or, if applicable, any employment
agreement or other agreement with such Participating Employee or Non-Employee
Director.
 
 
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(g) General.
 
(i) No Consideration for Awards. Awards shall be granted to Participating
Employees and Non-Employee Directors for no cash consideration unless otherwise
determined by the Committee.
 
(ii) Award Agreements. Each Award granted under the Plan shall be evidenced by
an Award Agreement in such form (consistent with the terms of the Plan) as shall
have been approved by the Committee.
 
(iii) Awards May Be Granted Separately or Together. Awards to Participating
Employees under the Plan may be granted either alone or in addition to, in
tandem with, or in substitution for any other Award or any award granted under
any other plan of the Company or any Affiliate. Awards granted in addition to or
in tandem with other Awards, or in addition to or in tandem with awards granted
under any other plan of the Company or any Affiliate, may be granted either at
the same time as or at a different time from the grant of such other Awards or
awards.
 
(iv) Forms of Payment Under Awards. Subject to the terms of the Plan and of any
applicable Award Agreement, payments or transfers to be made by the Company or
an Affiliate upon the grant, exercise, or payment of an Award to a Participating
Employee or Non-Employee Director may be made in such form or forms as the
Committee shall determine, and may be made in a single payment or transfer, in
installments, or on a deferred basis, in each case in accordance with rules and
procedures established by the Committee. Such rules and procedures may include,
without limitation, provisions for the payment or crediting of interest on
installment or deferred payments.
 
(v) Limits on Transfer of Awards. Except as otherwise provided by the Committee,
no Award (other than Released Securities), and no right under any such Award,
shall be assignable, alienable, saleable, or transferable by a Participating
Employee or Non-Employee Director otherwise than by will or by the laws of
descent and distribution (or, in the case of an Award of Restricted Securities,
to the Company); provided, however, that a Participating Employee or
Non-Employee Director at the discretion of the Committee may be entitled, in the
manner established by the Committee, to designate a beneficiary or beneficiaries
to exercise his or her rights, and to receive any property distributable, with
respect to any Award upon the death of the Participating Employee or
Non-Employee Director, as the case may be. Each Award, and each right under any
Award, shall be exercisable, during the lifetime of the Participating Employee
or Non-Employee Director, only by such individual or, if permissible under
applicable law, by such individual’s guardian or legal representative. Except as
otherwise provided by the Committee, no Award (other than Released Securities),
and no right under any such Award, may be pledged, alienated, attached, or
otherwise encumbered, and any purported pledge, alienation, attachment, or
encumbrance thereof shall be void and unenforceable against the Company or any
Affiliate.
 
(vi) Term of Awards. Except as otherwise provided in the Plan, the term of each
Award shall be for such period as may be determined by the Committee.
 
(vii) Share Certificates; Representation. In addition to the restrictions
imposed pursuant to Section 6(c) and Section 6(e) hereof, all certificates for
Shares delivered under the Plan pursuant to any Award or the exercise thereof
shall be subject to such stop transfer orders and other restrictions as the
Committee may deem advisable under the Plan or the rules, regulations, and other
requirements of the Commission, any stock exchange or other market upon which
such Shares are then listed or traded, and any applicable federal or state
securities laws, and the Committee may cause a legend or legends to be put on
any such certificates to make appropriate reference to such restrictions. The
Committee may require each Participating Employee, Non-Employee Director or
other Person who acquires Shares under the Plan by means of an Award originally
made to a Participating Employee or Non-Employee Director to represent to the
Company in writing that such Participating Employee, Non-Employee Director or
other Person is acquiring the Shares without a view to the distribution thereof.
 
 
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(h) Dividend Equivalents. In addition to Awards granted under the Plan, the
Committee may grant Dividend Equivalents to Participating Employees and
Non-Employee Directors, entitling the Participating Employees and Non-Employee
Directors to receive cash equal to cash dividends paid with respect to a
specified number of Shares. Dividend Equivalents may only be granted in
connection with an Award granted to the Participating Employee or Non-Employee
Director under the Plan. The Committee may provide that Dividend Equivalents
shall be paid or distributed when accrued or shall be deemed to have been
reinvested in such investment vehicles as determined by the Committee, subject
to such restrictions and risks of forfeiture as the Committee may impose.
 
(i) No Repricing of Options. Except adjustments made pursuant to Section 4(b) or
adjustments made with prior approval of the Company’s shareholders, the
Committee shall not have the authority to effect (i) the repricing of any
outstanding Options under the Plan or (ii) the modification of an Option or
entering into a transaction or series of transactions which modification or
transaction(s) would be deemed to constitute a repricing of an Option pursuant
to Financial Accounting Standards Board Interpretation No. 44, Accounting for
Certain Transactions Involving Stock Compensation, March 2000, as amended or
supplemented from time to time. The provisions of this Section 6(i) cannot be
amended unless the amendment is approved by the Company’s shareholders.
 
Section 7. Amendment and Termination of the Plan; Correction of Defects and
Omissions
 
(a) Amendments to and Termination of the Plan. Except as otherwise provided
herein, the Board may at any time amend, alter, suspend, discontinue, or
terminate the Plan; provided, however, that shareholder approval of any
amendment of the Plan shall also be obtained (i) if such amendment (A) increases
the number of Shares with respect to which Awards may be granted under the Plan
(other than increases related to adjustments made as provided in Section 4(b)
hereof), (B) expands the class of persons eligible to participate under the Plan
or (C) otherwise increases in any material respect the benefits payable under
the Plan; or (ii) if otherwise required by (A) the Code or any rules promulgated
thereunder (in order to allow for Incentive Stock Options to be granted under
the Plan), or (B) the listing requirements of the NASDAQ Global Select Market or
any principal securities exchange or market on which the Shares are then traded
(in order to maintain the listing of the Shares thereon). Termination of the
Plan shall not affect the rights of Participating Employees or Non-Employee
Directors with respect to Awards previously granted to them, and all unexpired
Awards shall continue in force and effect after termination of the Plan except
as they may lapse or be terminated by their own terms and conditions.
 
 
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(b) Amendment or Substitution of Awards under the Plan. Subject to Section 6(i),
the terms of any outstanding Award under the Plan may be amended from time to
time by the Committee in its discretion in any manner that it deems appropriate,
including, but not limited to, acceleration of the date of exercise of any award
and/or payments thereunder or of the date of lapse of restrictions on Shares
(but only to the extent permitted by regulations issued under Section 409A(a)(3)
of the Code); provided that, except as otherwise provided in Section 4(b), no
such amendment shall adversely affect in a material manner any right of a
participant under the award without his or her consent, and provided further
that in the event of any reduction in the exercise price of any options awarded
under the Plan, the reduced price may not be less than the Fair Market Value of
a Share on the effective date of the price reduction as required by Code Section
409A. The Committee may, in its discretion, permit holders of awards under the
Plan to surrender outstanding Awards in order to exercise or realize rights
under other Awards, or in exchange for the grant of new Awards, or require
holders of Awards to surrender outstanding awards as a condition precedent to
the grant of new awards under the Plan, but only if such surrender, exercise,
realization, exchange, or grant (a) would not constitute a distribution of
deferred compensation for purposes of Section 409A(a)(3) of the Code or (b)
constitutes a distribution of deferred compensation that is permitted under
regulations issued pursuant to Section 409A(a)(3) of the Code.
 
(c) Correction of Defects, Omissions and Inconsistencies. The Committee may
correct any defect, supply any omission, or reconcile any inconsistency in the
Plan, any Award or any Award Agreement in the manner and to the extent it shall
deem desirable to carry the Plan into effect.
 
Section 8. General Provisions
 
(a) No Rights to Awards. No Employee, Participating Employee, Non-Employee
Director or other Person shall have any claim to be granted any Award under the
Plan, and there is no obligation for uniformity of treatment of Employees,
Participating Employees, Non-Employee Directors or holders or beneficiaries of
Awards under the Plan. The terms and conditions of Awards need not be the same
with respect to each Participating Employee or Non-Employee Director.
 
(b) Withholding. No later than the date as of which tax withholding is first
required with respect to any Award under the Plan, the Participating Employee
shall pay to the Company, or make arrangements satisfactory to the Company
regarding the payment of, any federal, state, local or foreign taxes of any kind
required by law to be withheld with respect to such amount. Unless otherwise
determined by the Committee, withholding obligations arising with respect to
Awards to Participating Employees under the Plan may be settled with Shares
(other than Restricted Securities), including Shares that are part of, or are
received upon exercise of, the Award that gives rise to the withholding
requirement. The obligations of the Company under the Plan shall be conditional
on such payment or arrangements, and the Company and any Affiliate shall, to the
extent permitted by law, have the right to deduct any such taxes from any
payment otherwise due to the Participating Employee. The Committee may establish
such procedures as it deems appropriate for the settling of withholding
obligations with Shares, including, without limitation, the establishment of
such procedures as may be necessary to satisfy the requirements of Rule 16b-3.
 
(c) No Limit on Other Compensation Arrangements. Nothing contained in the Plan
shall prevent the Company or any Affiliate from adopting or continuing in effect
other or additional compensation arrangements, and such arrangements may be
either generally applicable or applicable only in specific cases.
 
 
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(d) Rights and Status of Recipients of Awards. The grant of an Award shall not
be construed as giving a Participating Employee the right to be retained in the
employ of the Company or any Affiliate. Further, the Company or any Affiliate
may at any time dismiss a Participating Employee from employment, free from any
liability, or any claim under the Plan, unless otherwise expressly provided in
the Plan or in any Award Agreement. The grant of an Award to a Non-Employee
Director pursuant to Section 6(a) of the Plan shall confer no right on such
Non-Employee Director to continue as a director of the Company or any Affiliate.
Except for rights accorded under the Plan and under any applicable Award
Agreement, Participating Employees and Non-Employee Directors shall have no
rights as holders of Shares as a result of the granting of Awards hereunder.
 
(e) No Compensation for Benefit Plans. No Award payable under this Plan shall be
deemed salary or compensation for the purpose of computing benefits under any
benefit plan or other arrangement of the Company or any Affiliate for the
benefit of its employees or directors unless the Company or appropriate
Affiliate shall determine otherwise.
 
(f) Approval of Material Terms of Performance Goals. Notwithstanding anything
herein to the contrary, if so determined by the Board, the Plan provisions
specifying the material terms of the Plan’s performance goals (within the
meaning of Code Section 162(m)) shall be submitted to the shareholders of the
Company for re-approval no later than the first shareholder meeting that occurs
in the fifth year following the year in which shareholders previously approved
such Plan provisions.
 
(g) Unfunded Status of the Plan. Unless otherwise determined by the Committee,
the Plan shall be unfunded and shall not create (or be construed to create) a
trust or a separate fund or funds. The Plan shall not establish any fiduciary
relationship between the Company and any Participating Employee, Non-Employee
Director or other Person. To the extent any Person holds any right by virtue of
a grant under the Plan, such right (unless otherwise determined by the
Committee) shall be no greater than the right of a general unsecured creditor of
the Company.
 
(h) Governing Law. The validity, construction, and effect of the Plan and any
rules and regulations relating to the Plan shall be determined in accordance
with the internal laws of the State of Florida, without reference to conflict of
law principles thereof, and applicable federal law.
 
(i) Severability. If any provision of the Plan or any Award Agreement or any
Award is or becomes or is deemed to be invalid, illegal, or unenforceable in any
jurisdiction, or as to any Person or Award, or would disqualify the Plan, any
Award Agreement or any Award under any law deemed applicable by the Committee,
such provision shall be construed or deemed amended to conform to applicable
laws, or if it cannot be so construed or deemed amended without, in the
determination of the Committee, materially altering the intent of the Plan, any
Award Agreement or the Award, such provision shall be stricken as to such
jurisdiction, Person, or Award, and the remainder of the Plan, any such Award
Agreement and any such Award shall remain in full force and effect.
 
 
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(j) No Fractional Shares. No fractional Shares or other securities shall be
issued or delivered pursuant to the Plan, any Award Agreement or any Award, and
the Committee shall determine (except as otherwise provided in the Plan) whether
cash, other securities, or other property shall be paid or transferred in lieu
of any fractional Shares or other securities, or whether such fractional Shares
or other securities or any rights thereto shall be canceled, terminated, or
otherwise eliminated.
 
(k) Headings. Headings are given to the Sections and subsections of the Plan
solely as a convenience to facilitate reference. Such headings shall not be
deemed in any way material or relevant to the construction or interpretation of
the Plan or any provision thereof.
 
Section 9. Effective Date of the Plan
 
The effective date of the Plan is March 8, 2004, and the shareholders of the
Company approved the Plan within twelve months following the effective date. The
Plan was amended and restated by the Board of Directors as of November 20, 2008.
 
 
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