Exhibit 10.1

H&R BLOCK, INC.

2013 LONG TERM INCENTIVE PLAN

(Amended and Restated effective March 6, 2013)

H&R Block, Inc. (the “Company”), a Missouri corporation, hereby establishes and
adopts the following 2013 Long Term Incentive Plan (the “Plan”).

1. PURPOSE OF THE PLAN

The purpose of the Plan is to assist the Company and its Subsidiaries in
attracting and retaining selected individuals to serve as employees, directors,
consultants and/or advisors who are expected to contribute to the Company’s
success and to achieve long-term objectives that will benefit shareholders of
the Company through the additional incentives inherent in the Awards hereunder.

2. DEFINITIONS

2.1. “Award” shall mean any Option, Stock Appreciation Right, Restricted Share
Award, Restricted Share Unit Award, Other Share-Based Award, Performance Award
or any other right, interest or option relating to Shares or other property
(including cash) granted pursuant to the provisions of the Plan.

2.2. “Award Agreement” shall mean any agreement, contract or other instrument or
document evidencing any Award hereunder, whether in writing or through an
electronic medium.

2.3. “Board” shall mean the board of directors of the Company.

2.4. “Code” shall mean the Internal Revenue Code of 1986, as amended from time
to time.

2.5. “Committee” shall mean the Compensation Committee of the Board or a
subcommittee thereof formed by the Compensation Committee to act as the
Committee hereunder. The Committee shall consist of no fewer than two Directors,
each of whom is (a) a “non-employee director” within the meaning of Rule 16b-3
under the Exchange Act, (b) an “outside director” within the meaning of
Section 162(m) of the Code, and (c) an “independent director” for purpose of the
rules of the principal U.S. national securities exchange on which the Shares are
traded, to the extent required by such rules.

2.6. “Consultant” shall mean any consultant or advisor who is a natural person
and who provides services to the Company or any Subsidiary, so long as such
person (a) renders bona fide services that are not in connection with the offer
and sale of the Company’s securities in a capital-raising transaction, (b) does
not directly or indirectly promote or maintain a market for the Company’s
securities, and (c) otherwise qualifies as a consultant under the applicable
rules of the SEC for registration of shares of stock on a Form S-8 registration
statement.

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2.7. “Covered Employee” shall mean an employee of the Company or its
Subsidiaries who is a “covered employee” within the meaning of Section 162(m) of
the Code.

2.8. “Director” shall mean a member of the Board who is not an employee.

2.9. “Dividend Equivalents” shall have the meaning set forth in Section 12.5.

2.10. “Employee” shall mean any employee of the Company or any Subsidiary and
any prospective employee conditioned upon, and effective not earlier than, such
person becoming an employee of the Company or any Subsidiary.

2.11. “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

2.12. “Fair Market Value” shall mean, with respect to Shares as of any date,
(a) the closing price of the Shares as reported on the principal U.S. national
securities exchange on which the Shares are listed and traded on such date, or,
if there is no closing price on that date, then on the last preceding date on
which such a closing price was reported, (b) if the Shares are not listed on any
U.S. national securities exchange but are quoted in an inter-dealer quotation
system on a last sale basis, the final ask price of the Shares reported on the
inter-dealer quotation system for such date, or, if there is no such sale on
such date, then on the last preceding date on which a sale was reported, or
(c) if the Shares are neither listed on a U.S. national securities exchange nor
quoted on an inter-dealer quotation system on a last sale basis, the amount
determined by the Committee to be the fair market value of the Shares as
determined by the Committee in its sole discretion. The Fair Market Value of any
property other than Shares shall mean the market value of such property
determined by such methods or procedures as shall be established from time to
time by the Committee.

2.13. “Incentive Stock Option” shall mean an Option which when granted is
intended to qualify as an incentive stock option for purposes of Section 422 of
the Code.

2.14. “Option” shall mean any right granted to a Participant under the Plan
allowing such Participant to purchase Shares at such price or prices and during
such period or periods as the Committee shall determine.

2.15. “Other Share-Based Award” shall have the meaning set forth in Section 8.1.

2.16. “Participant” shall mean an Employee, Director or Consultant who is
selected by the Committee to receive an Award under the Plan.

2.17. “Performance Award” shall mean any Award of Performance Cash, Performance
Share Units or Performance Units granted pursuant to Section 9.

2.18. “Performance Cash” shall mean any cash incentives granted pursuant to
Section 9 payable to the Participant upon the achievement of such performance
goals as the Committee shall establish.

2.19. “Performance Period” shall mean the period established by the Committee
during which any performance goals specified by the Committee with respect to a
Performance Award are to be measured.

 

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2.20. “Performance Share Unit” shall mean any grant pursuant to Section 9 of a
unit valued by reference to a designated number of Shares, which value may be
paid to the Participant upon achievement of such performance goals as the
Committee shall establish.

2.21. “Performance Unit” shall mean any grant pursuant to Section 9 of a unit
valued by reference to a designated amount of cash or property other than
Shares, which value may be paid to the Participant upon achievement of such
performance goals during the Performance Period as the Committee shall
establish.

2.22. “Permitted Assignee” shall have the meaning set forth in Section 12.3.

2.23. “Prior Plans” shall mean, collectively, the Company’s 2003 Long-Term
Executive Compensation Plan and 2008 Deferred Stock Unit Plan for Outside
Directors.

2.24. “Restricted Share” shall mean any Share issued with the restriction that
the holder may not sell, transfer, pledge or assign such Share and with such
other restrictions as the Committee, in its sole discretion, may impose, which
restrictions may lapse separately or in combination at such time or times, in
installments or otherwise, as the Committee may deem appropriate.

2.25. “Restricted Share Award” shall have the meaning set forth in Section 7.1.

2.26 “Restricted Share Unit” means an Award that is valued by reference to a
Share, which value may be paid to the Participant in Shares or cash as
determined by the Committee in its sole discretion upon the satisfaction of
vesting restrictions as the Committee may establish, which restrictions may
lapse separately or in combination at such time or times, in installments or
otherwise, as the Committee may deem appropriate.

2.27 “Restricted Share Unit Award” shall have the meaning set forth in
Section 7.1.

2.28. “SEC” means the Securities and Exchange Commission.

2.29. “Shares” shall mean the shares of common stock of the Company, without par
value.

2.30. “Stock Appreciation Right” shall mean the right granted to a Participant
pursuant to Section 6.

2.31. “Subsidiary” shall mean any corporation (other than the Company), limited
liability company, partnership, or other form of business entity in an unbroken
chain of such entities beginning with the Company if, at the relevant time each
of the entities other than the last entity in the unbroken chain owns stock or
other similar ownership interests possessing 50% or more of the total combined
voting power of all classes of stock or other similar ownership interests in one
of the other entities in the chain.

2.32. “Substitute Awards” shall mean Awards granted or Shares issued by the
Company in assumption of, or in substitution or exchange for, awards previously
granted, or the right or obligation to make future awards, in each case by a
company acquired by the Company or any Subsidiary or with which the Company or
any Subsidiary combines.

 

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2.33. “Vesting Period” shall mean the period of time specified by the Committee
or Board during which vesting restrictions for an Award are applicable.

3. SHARES SUBJECT TO THE PLAN

3.1 Number of Shares. (a) Subject to adjustment as provided in Section 12.2, a
total of 12,000,000 Shares shall be authorized for Awards granted under the
Plan. After the effective date of the Plan (as provided in Section 13.13), no
awards may be granted under any Prior Plan.

(b) If (i) any Shares subject to an Award are forfeited, an Award expires or
otherwise terminates without issuance of Shares, or an Award is settled for cash
(in whole or in part) or otherwise does not result in the issuance of all or a
portion of the Shares subject to such Award (including on payment in Shares on
exercise of a Stock Appreciation Right), such Shares shall, to the extent of
such forfeiture, expiration, termination, cash settlement or non-issuance, again
be available for grant under the Plan, or (ii) any Shares subject to an award
under the Prior Plans are forfeited, an award under the Prior Plans expires or
otherwise terminates without issuance of such Shares, or an award under the
Prior Plans is settled for cash (in whole or in part), or otherwise does not
result in the issuance of all or a portion of the Shares subject to such award
(including on payment in Shares on exercise of a stock appreciation right), then
in each such case the Shares subject to the Award or award under the Prior Plans
shall, to the extent of such forfeiture, expiration, termination, cash
settlement or non-issuance, again be available for grant under the Plan on a
one-for-one basis.

(c) In the event that (i) any Option or other Award granted hereunder is
exercised through the tendering of Shares (either actually or by attestation) or
by the withholding of Shares by the Company, or (ii) withholding tax liabilities
arising from such Option or other Award are satisfied by the tendering of Shares
(either actually or by attestation) or by the withholding of Shares by the
Company, then in each such case the Shares so tendered or withheld shall be
available for grant under the Plan on a one-for-one basis. In the event that
(i) any option or award granted under the Prior Plans is exercised through the
tendering of Shares (either actually or by attestation) or by the withholding of
Shares by the Company, or (ii) withholding tax liabilities arising from such
options or awards are satisfied by the tendering of Shares (either actually or
by attestation) or by the withholding of Shares by the Company, then in each
such case the Shares so tendered or withheld shall be available for grant under
the Plan on a one-for-one basis.

(d) Substitute Awards shall not reduce the Shares authorized for grant under the
Plan or the applicable limitations for grant to a Participant under
Section 10.5, nor shall Shares subject to a Substitute Award again be available
for Awards under the Plan as provided in Sections 3.1(b) and (c) above.
Additionally, in the event that a company acquired by the Company or any
Subsidiary or with which the Company or any Subsidiary combines has shares
available under a pre-existing plan approved by shareholders and not adopted in
contemplation of such acquisition or combination, the shares available for grant
pursuant to the terms of such pre-existing plan (as adjusted, to the extent
appropriate, using the exchange ratio or other adjustment or valuation ratio or
formula used in such acquisition or combination to determine the consideration
payable to the holders of common stock of the entities that are parties to such
acquisition or combination) may be used for Awards under the Plan and shall not
reduce the Shares authorized for grant under the Plan; provided that Awards
using such available shares

 

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shall not be made after the date awards or grants could have been made under the
terms of the pre-existing plan, absent the acquisition or combination, and shall
only be made to individuals who were not Employees or Directors prior to such
acquisition or combination.

3.2. Character of Shares. Any Shares issued hereunder may consist, in whole or
in part, of authorized and unissued shares, treasury shares or shares purchased
in the open market or otherwise.

4. ELIGIBILITY AND ADMINISTRATION

4.1. Eligibility. Any Employee, Director or Consultant shall be eligible to be
selected as a Participant.

4.2. Administration. (a) Except with respect to any authority, duties or
responsibilities that the Committee is permitted and elects to delegate
hereunder, the Plan shall be administered by the Committee. The Committee shall
have full power and authority, subject to the provisions of the Plan and subject
to such orders or resolutions not inconsistent with the provisions of the Plan
as may from time to time be adopted by the Board, to: (i) select the Employees,
Directors and Consultants to whom Awards may from time to time be granted
hereunder; (ii) determine the type or types of Awards to be granted to each
Participant hereunder; (iii) determine the number of Shares (or dollar value) to
be covered by each Award granted hereunder; (iv) determine the terms and
conditions, not inconsistent with the provisions of the Plan, of any Award
granted hereunder; (v) determine whether, to what extent and under what
circumstances Awards may be settled in cash, Shares or other property;
(vi) determine whether, to what extent, and under what circumstances cash,
Shares, other property and other amounts payable with respect to an Award made
under the Plan shall be deferred either automatically or at the election of the
Participant; (vii) determine whether, to what extent and under what
circumstances any Award shall be canceled or suspended; (viii) interpret and
administer the Plan and any instrument or agreement entered into under or in
connection with the Plan, including any Award Agreement; (ix) correct any
defect, supply any omission or reconcile any inconsistency in the Plan or any
Award in the manner and to the extent that the Committee shall deem desirable to
carry it into effect; (x) establish such rules and regulations and appoint such
agents as it shall deem appropriate for the proper administration of the Plan;
(xi) determine whether any Award, other than an Option or Stock Appreciation
Right, will include Dividend Equivalents; and (xii) make any other determination
and take any other action that the Committee deems necessary or desirable for
the administration of the Plan.

(b) Decisions of the Committee shall be final, conclusive and binding on all
persons or entities, including the Company, any Participant, and any Subsidiary.
A majority of the members of the Committee may determine its actions, including
fixing the time and place of its meetings.

(c) To the extent not inconsistent with applicable law (including without
limitation applicable state laws) Section 162(m) of the Code with respect to
Awards intended to comply with the performance-based compensation exception
under Section 162(m), and the rules and regulations of the principal U.S.
national securities exchange on which the Shares are traded, the Committee may
(i) delegate to a committee of one or more Directors of the Company, or such
higher number as may be required under applicable law, any of the authority of
the

 

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Committee under the Plan, including the right to grant, cancel or suspend
Awards, (ii) delegate to one or more executive officers the Committee’s
authority, duties and responsibilities relating to the Company’s right to
prevent, enforce or remedy affirmative or restrictive covenants contained in any
Award, as set forth in Section 13.5(b), including the authority for such
executive officer(s) to further delegate such authority, duties and
responsibilities to any other individual or entity, whether or not such person
or entity is employed by, an officer of, or affiliated with the Company and
(iii) authorize one or more executive officers to do one or more of the
following with respect to Employees who are not directors or executive officers
of the Company to the extent permissible under applicable law: (A) designate
Employees to be recipients of Awards, (B) determine the number of Shares subject
to such Awards to be received by such Employees and (C) cancel or suspend Awards
to such Employees; provided that (x) any resolution of the Committee authorizing
such officer(s) must specify the total number of Shares subject to Awards that
such officer(s) may so award and (y) the Committee may not authorize any officer
to designate himself or herself as the recipient of an Award.

5. OPTIONS

5.1. Grant. Options may be granted hereunder to Participants either alone or in
addition to other Awards granted under the Plan. Any Option shall be subject to
the terms and conditions of this Section 5 and to such additional terms and
conditions, not inconsistent with the provisions of the Plan, as the Committee
shall deem desirable.

5.2. Award Agreements. All Options shall be evidenced by an Award Agreement in
such form and containing such terms and conditions as the Committee or Board
shall determine which are not inconsistent with the provisions of the Plan. The
terms and conditions of Options need not be the same with respect to each
Participant. Granting an Option pursuant to the Plan shall impose no obligation
on the recipient to exercise such Option. Any individual who is granted an
Option pursuant to this Section 5 may hold more than one Option granted pursuant
to the Plan at the same time.

5.3. Option Price. Other than in connection with Substitute Awards, the option
price per each Share purchasable under any Option granted pursuant to this
Section 5 shall not be less than 100% of the Fair Market Value of one Share on
the date of grant of such Option; provided, however, that in the case of an
Incentive Stock Option granted to a Participant who, at the time of the grant,
owns stock representing more than 10% of the voting power of all classes of
stock of the Company or any Subsidiary, the option price per share shall be no
less than 110% of the Fair Market Value of one Share on the date of grant. Other
than pursuant to Section 12.2, the Committee shall not without the approval of
the Company’s shareholders (a) lower the option price per Share of an Option
after it is granted, (b) cancel an Option when the option price per Share
exceeds the Fair Market Value of one Share in exchange for cash, another Award
or other consideration (other than in connection with a Change in Control as
defined in Section 11.3), or (c) take any other action with respect to an Option
that would be treated as a repricing under the rules and regulations of the
principal U.S. national securities exchange on which the Shares are listed.

5.4. Option Term. The term of each Option shall be fixed by the Committee in its
sole discretion; provided that no Option shall be exercisable after the
expiration of ten (10) years from the date the Option is granted, except in the
event of death or disability; provided, however,

 

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that the term of the Option shall not exceed five (5) years from the date the
Option is granted in the case of an Incentive Stock Option granted to a
Participant who, at the time of the grant, owns stock representing more than 10%
of the voting power of all classes of stock of the Company or any Subsidiary.
Notwithstanding the foregoing, in the event that on the last business day of the
term of an Option (a) the exercise of the Option, other than an Incentive Stock
Option, is prohibited by applicable law or (b) Shares may not be purchased or
sold by certain Employees or Directors due to the “black-out period” of a
Company policy or a “lock-up” agreement undertaken in connection with an
issuance of securities by the Company, the term shall be extended for a period
of thirty (30) days following the end of the legal prohibition, black-out period
or lock-up agreement.

5.5. Vesting of Options. The Award Agreement shall specify when Options vest and
become exercisable. Except for Substitute Awards, the death, disability or
retirement of the Participant, or special circumstances determined by the
Committee, Options shall have a Vesting Period of not less than (a) twenty-four
(24) months from date of grant (but permitting pro rata vesting over such time)
if subject only to continued service with the Company or a Subsidiary and
(b) one year from the date of grant if subject to the achievement of performance
objectives, subject in either case to accelerated vesting in the Committee’s
discretion in the event of a Change in Control (as defined in Section 11.3) if
the Options are not assumed, substituted for or continued as provided in
Section 11.2. Notwithstanding the foregoing, the restrictions in the preceding
sentence shall not be applicable to (x) grants to new hires to replace forfeited
awards from a prior employer or (y) grants in payment of Performance Awards and
other earned cash-based incentive compensation. The minimum Vesting Period
requirements of this Section shall not apply to Options granted to Directors or
Consultants.

5.6. Exercise of Options. (a) Vested Options granted under the Plan shall be
exercised by the Participant or by a Permitted Assignee thereof (or the
Participant’s executors, administrators, guardian or legal representative, to
the extent provided in an Award Agreement) as to all or part of the Shares
covered thereby, by giving notice of exercise to the Company or its designated
agent, specifying the number of Shares to be purchased. The notice of exercise
shall be in such form, made in such manner, and shall comply with such other
requirements consistent with the provisions of the Plan as the Committee, or any
representative authorized by the Committee, may prescribe from time to time.

(b) Unless otherwise provided in an Award Agreement, full payment of such
purchase price shall be made at the time of exercise and shall be made (i) in
cash or cash equivalents (including certified check or bank check or wire
transfer of immediately available funds), (ii) by tendering previously acquired
Shares (either actually or by attestation) valued at their then Fair Market
Value, (iii) with the consent of the Committee, by delivery of other
consideration having a Fair Market Value on the exercise date equal to the total
purchase price, (iv) with the consent of the Committee, by withholding Shares
otherwise issuable in connection with the exercise of the Option, (v) through
any other method specified in an Award Agreement (including same-day sales
through a broker), or (vi) any combination of any of the foregoing. The notice
of exercise, accompanied by such payment, shall be delivered to the Company or
its designated agent at its principal business office or such other office as
the Committee may from time to time direct, and shall be in such form,
containing such further provisions consistent with the provisions of the Plan,
as the Committee may from time to time prescribe. In no event may any Option
granted hereunder be exercised for a fraction of a Share.

 

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(c) Notwithstanding the foregoing, an Award Agreement may provide that if, on
the last day of the term of an Option, the Fair Market Value of one Share
exceeds the option price per Share, the Participant has not exercised the Option
(or a tandem Stock Appreciation Right, if applicable) and the Option has not
expired, the Option shall be deemed to have been exercised by the Participant on
such day with payment made by withholding Shares otherwise issuable in
connection with the exercise of the Option. In such event, the Company shall
deliver to the Participant the number of Shares for which the Option was deemed
exercised, less the number of Shares required to be withheld for the payment of
the total purchase price and required withholding taxes; provided, however, any
fractional Share shall be settled in cash.

5.7. Form of Settlement. In its sole discretion, the Committee may provide that
the Shares to be issued upon an Option’s exercise shall be in the form of
Restricted Shares or other similar securities.

5.8. Incentive Stock Options. The Committee may grant Incentive Stock Options to
any Employee, subject to the requirements of Section 422 of the Code. Solely for
purposes of determining whether Shares are available for the grant of Incentive
Stock Options under the Plan, the maximum aggregate number of Shares that may be
issued pursuant to Incentive Stock Options granted under the Plan shall be
12,000,000 Shares, subject to adjustment as provided in Section 12.2.

6. STOCK APPRECIATION RIGHTS

6.1. Grant and Vesting.

(a) The Committee may grant Stock Appreciation Rights (i) in tandem with all or
part of any Option granted under the Plan or at any subsequent time during the
term of such Option, (ii) in tandem with all or part of any Award (other than an
Option) granted under the Plan or at any subsequent time during the term of such
Award, or (iii) without regard to any Option or other Award in each case upon
such terms and conditions as the Committee may establish in its sole discretion.

(b) The Award Agreement shall specify when Stock Appreciation Rights vest and
become exercisable. Except for Substitute Awards, the death, disability or
retirement of the Participant, or special circumstances determined by the
Committee, Stock Appreciation Rights shall have a Vesting Period of not less
than (i) twenty-four (24) months from date of grant (but permitting pro rata
vesting over such time) if subject only to continued service with the Company or
a Subsidiary and (ii) one year from the date of grant if subject to the
achievement of performance objectives, subject in either case to accelerated
vesting in the Committee’s discretion in the event of a Change in Control (as
defined in Section 11.3) if the Stock Appreciation Rights are not assumed,
substituted for or continued as provided in Section 11.2. Notwithstanding the
foregoing, the restrictions in the preceding sentence shall not be applicable to
(x) grants to new hires to replace forfeited awards from a prior employer or
(y) grants in payment of Performance Awards and other earned cash-based
incentive compensation. The minimum Vesting Period requirements of this Section
shall not apply to Stock Appreciation Rights granted to Directors or
Consultants.

 

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6.2. Terms and Conditions. Stock Appreciation Rights shall be subject to such
terms and conditions, not inconsistent with the provisions of the Plan, as shall
be determined from time to time by the Committee, including the following:

(a) Upon the exercise of a Stock Appreciation Right, the holder shall have the
right to receive the excess of (i) the Fair Market Value of one Share on the
date of exercise (or such amount less than such Fair Market Value as the
Committee shall so determine at any time during a specified period before the
date of exercise) over (ii) the grant price of the Stock Appreciation Right.

(b) The Committee shall determine in its sole discretion whether payment on
exercise of a Stock Appreciation Right shall be made in cash, in whole Shares or
other property, or any combination thereof.

(c) The terms and conditions of Stock Appreciation Rights need not be the same
with respect to each recipient.

(d) The Committee may impose such other terms and conditions on the exercise of
any Stock Appreciation Right, as it shall deem appropriate. A Stock Appreciation
Right shall (i) have a grant price per Share of not less than the Fair Market
Value of one Share on the date of grant or, if applicable, on the date of grant
of an Option with respect to a Stock Appreciation Right granted in exchange for
or in tandem with, but subsequent to, the Option (subject to the requirements of
Section 409A of the Code) except in the case of Substitute Awards or in
connection with an adjustment provided in Section 12.2, and (ii) have a term not
greater than ten (10) years, except in the event of death or disability.
Notwithstanding clause (ii) of the preceding sentence, in the event that on the
last business day of the term of a Stock Appreciation Right (x) the exercise of
the Stock Appreciation Right is prohibited by applicable law or (y) Shares may
not be purchased or sold by certain Employees or Directors due to the “black-out
period” of a Company policy or a “lock-up” agreement undertaken in connection
with an issuance of securities by the Company, the term shall be extended for a
period of thirty (30) days following the end of the legal prohibition, black-out
period or lock-up agreement.

(e) An Award Agreement may provide that if, on the last day of the term of a
Stock Appreciation Right, the Fair Market Value of one Share exceeds the grant
price per Share of the Stock Appreciation Right, the Participant has not
exercised the Stock Appreciation Right or the tandem Option (if applicable), and
the Stock Appreciation Right has not otherwise expired, the Stock Appreciation
Right shall be deemed to have been exercised by the Participant on such day. In
such event, the Company shall make payment to the Participant in accordance with
this Section, reduced by the number of Shares (or cash) required for withholding
taxes; any fractional Share shall be settled in cash.

(f) Without the approval of the Company’s shareholders, other than pursuant to
Section 12.2, the Committee shall not (i) reduce the grant price of any Stock
Appreciation Right after the date of grant, (ii) cancel any Stock Appreciation
Right when the grant price per Share exceeds the Fair Market Value of one Share
in exchange for cash, another Award or other consideration (other than in
connection with a Change in Control as defined in Section 11.3), or (iii) take
any other action with respect to a Stock Appreciation Right that would be
treated as a repricing under the rules and regulations of the principal U.S.
national securities exchange on which the Shares are listed.

 

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7. RESTRICTED SHARES AND RESTRICTED SHARE UNITS

7.1. Grants. Awards of Restricted Shares and of Restricted Share Units may be
granted hereunder to Participants either alone or in addition to other Awards
granted under the Plan (a “Restricted Share Award” or “Restricted Share Unit
Award” respectively), and such Restricted Share Awards and Restricted Share Unit
Awards shall also be available as a form of payment of Performance Awards and
other earned cash-based incentive compensation. The Committee has absolute
discretion to determine whether any consideration (other than services) is to be
received by the Company or any Subsidiary as a condition precedent to the grant
of Restricted Shares or Restricted Share Units, subject to such minimum
consideration as may be required by applicable law.

7.2. Award Agreements. The terms of any Restricted Share Award or Restricted
Share Unit Award granted under the Plan shall be set forth in an Award Agreement
which shall contain provisions determined by the Committee or Board and not
inconsistent with the Plan. The terms of Restricted Share Awards and Restricted
Share Unit Awards need not be the same with respect to each Participant.

7.3. Rights of Holders of Restricted Shares and Restricted Share Units.

(a) Unless otherwise provided in the Award Agreement, beginning on the date of
grant of the Restricted Share Award and subject to execution of the Award
Agreement, the Participant shall become a shareholder of the Company with
respect to all Shares subject to the Award Agreement and shall have all of the
rights of a shareholder, including the right to vote such Shares and the right
to receive distributions made with respect to such Shares, except as otherwise
provided in this Section.

(b) A Participant who holds a Restricted Share Unit Award shall only have those
rights specifically provided for in the Award Agreement; provided, however, in
no event shall the Participant have voting rights with respect to such Award.

(c) Except as otherwise provided in an Award Agreement, any Shares or any other
property distributed as a dividend or otherwise with respect to any Restricted
Share Award or Restricted Share Unit Award as to which the restrictions have not
yet lapsed shall be subject to the same restrictions as such Restricted Share
Award or Restricted Share Unit Award, and the Committee shall have the sole
discretion to determine whether, if at all, any cash-denominated amount that is
subject to such restrictions shall earn interest and at what rate.
Notwithstanding the provisions of this Section, cash dividends, stock and any
other property (other than cash) distributed as a dividend or otherwise with
respect to any Restricted Share Award or Restricted Share Unit Award that vests
based on achievement of performance goals shall either (i) not be paid or
credited or (ii) be accumulated, shall be subject to restrictions and risk of
forfeiture to the same extent as the Restricted Shares or Restricted Share Units
with respect to which such cash, stock or other property has been distributed,
and shall be paid at the time such restrictions and risk of forfeiture lapse.

 

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7.4. Vesting Period. The Award Agreement shall specify the Vesting Period for
Restricted Share Awards or Restricted Share Unit Awards. Except for Substitute
Awards, the death, disability or retirement of the Participant, or special
circumstances determined by the Committee, Restricted Share Awards and
Restricted Share Unit Awards shall have a Vesting Period of not less than
(a) twenty-four (24) months from date of grant (but permitting pro rata vesting
over such time) if subject only to continued service with the Company or a
Subsidiary and (b) one year from the date of grant if subject to the achievement
of performance objectives, subject in either case to accelerated vesting in the
Committee’s discretion in the event of a Change in Control (as defined in
Section 11.3) if the Restricted Share Awards or Restricted Share Unit Awards are
not assumed, substituted for or continued as provided in Section 11.2.
Notwithstanding the foregoing, the restrictions in the preceding sentence shall
not be applicable to (x) grants to new hires to replace forfeited awards from a
prior employer or (y) grants in payment of Performance Awards and other earned
cash-based incentive compensation. The minimum Vesting Period requirements of
this Section shall not apply to Restricted Share Awards or Restricted Share Unit
Awards granted to Directors or Consultants.

7.5 Issuance of Shares. Any Restricted Shares granted under the Plan may be
evidenced in such manner as the Board may deem appropriate, including book-entry
registration or issuance of a stock certificate or certificates, which
certificate or certificates shall be held by the Company. Such book entry
registration, certificate or certificates shall be registered in the name of the
Participant and shall bear an appropriate legend referring to the restrictions
applicable to such Restricted Shares.

8. OTHER SHARE-BASED AWARDS

8.1. Grants. Other Awards of Shares and other Awards that are valued in whole or
in part by reference to, or are otherwise based on, Shares or other property
(“Other Share-Based Awards”), including deferred stock units, may be granted
hereunder to Participants either alone or in addition to other Awards granted
under the Plan. Other Share-Based Awards shall also be available as a form of
payment of other Awards granted under the Plan and other earned cash-based
compensation.

8.2. Award Agreements. The terms of Other Share-Based Awards granted under the
Plan shall be set forth in an Award Agreement which shall contain provisions
determined by the Committee and that are not inconsistent with the Plan. The
terms of such Awards need not be the same with respect to each Participant.
Notwithstanding the provisions of this Section 8, Dividend Equivalents with
respect to the Shares covered by an Other Share-Based Award that vests based on
achievement of performance goals shall be subject to restrictions and risk of
forfeiture to the same extent as the Shares covered by an Other Share-Based
Award with respect to which such cash, stock or other property has been
distributed.

8.3. Vesting Period. The Award Agreement shall specify the Vesting Period for
Other Share-Based Awards. Except for Substitute Awards, the death, disability or
retirement of the Participant, or special circumstances determined by the
Committee, Other Share-Based Awards shall have a Vesting Period of not less than
(a) twenty-four (24) months from date of grant (but permitting pro rata vesting
over such time) if subject only to continued service with the Company or a
Subsidiary and (b) one year from the date of grant if subject to the achievement
of performance objectives, subject in either case to accelerated vesting in the
Committee’s

 

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discretion in the event of a Change in Control (as defined in Section 11.3) if
the Other Share-Based Awards are not assumed, substituted for or continued as
provided in Section 11.2. Notwithstanding the foregoing, the restrictions in the
preceding sentence shall not be applicable to (x) grants to new hires to replace
forfeited awards from a prior employer or (y) grants of Other Share-Based Awards
in payment of Performance Awards and other earned cash-based incentive
compensation. The minimum Vesting Period requirements of this Section shall not
apply to Other Share-Based Awards granted to Directors or Consultants.

8.4. Payment. Except as may be provided in an Award Agreement, Other Share-Based
Awards may be paid in cash, Shares, other property, or any combination thereof,
in the sole discretion of the Committee. Other Share-Based Awards may be paid in
a lump sum or in installments or, in accordance with procedures established by
the Committee, on a deferred basis subject to the requirements of Section 409A
of the Code.

9. PERFORMANCE AWARDS

9.1. Grants. Performance Awards in the form of Performance Cash, Performance
Share Units or Performance Units, as determined by the Committee in its sole
discretion, may be granted hereunder to Participants, for no consideration or
for such minimum consideration as may be required by applicable law, either
alone or in addition to other Awards granted under the Plan. The performance
goals to be achieved for each Performance Period shall be conclusively
determined by the Committee or Board and may be based upon the criteria set
forth in Section 10.2 or such other criteria as determined by the Committee in
its discretion.

9.2. Award Agreements. The terms of any Performance Award granted under the Plan
shall be set forth in an Award Agreement (or, if applicable, in a resolution
duly adopted by the Committee) which shall contain provisions determined by the
Committee or Board and that are not inconsistent with the Plan, including
whether such Awards shall have Dividend Equivalents. The terms of Performance
Awards need not be the same with respect to each Participant.

9.3. Terms and Conditions. The performance criteria to be achieved during any
Performance Period and the length of the Performance Period shall be determined
by the Committee or Board upon the grant of each Performance Award; provided,
however, that a Performance Period shall not be shorter than one year unless the
Award is not payable in Shares. The amount of the Award to be distributed shall
be conclusively determined by the Committee or Board.

9.4. Payment. Except as provided in Section 11, as provided by the Committee or
Board or as may be provided in an Award Agreement, Performance Awards will be
distributed only after the end of the relevant Performance Period. Performance
Awards may be paid in cash, Shares, other property, or any combination thereof,
in the sole discretion of the Committee or Board. Performance Awards may be paid
in a lump sum or in installments following the close of the Performance Period
or, in accordance with procedures established by the Committee or Board, on a
deferred basis subject to the requirements of Section 409A of the Code.

 

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10. CODE SECTION 162(m) PROVISIONS

10.1. Covered Employees. Notwithstanding any other provision of the Plan, if the
Committee determines at the time a Restricted Share Award, a Restricted Share
Unit Award, a Performance Award or an Other Share-Based Award is granted to a
Participant who is, or may be, as of the end of the tax year in which the
Company would claim a tax deduction in connection with such Award, a Covered
Employee, then the Committee may provide that this Section 10 is applicable to
such Award.

10.2. Performance Criteria.

(a) If the Committee determines that a Restricted Share Award, a Restricted
Share Unit, a Performance Award, an Other Share-Based Award or any other Award
is intended to be subject to this Section 10, the lapsing of restrictions
thereon and the distribution of cash, Shares or other property pursuant thereto,
as applicable, shall be subject to the achievement of one or more objective
performance goals established by the Committee, which shall be based on the
attainment of specified levels of one or any combination of the following: sales
(including comparable sales); net sales; return on sales; revenue, net revenue,
product revenue or system-wide revenue (including growth of such revenue
measures); operating income (before or after taxes); pre- or after-tax income or
loss (before or after allocation of corporate overhead and bonus); earnings or
loss per share; net income or loss (before or after taxes); return on equity
(including average return on equity); total shareholder return (or any element
of shareholder return); return on assets or net assets; the price of the Shares
or any other publicly-traded securities of the Company; total number of clients;
number of new clients; client retention; total tax returns prepared; market
share; gross profits; gross or net profit margin; gross profit growth; net
operating profit (before or after taxes); operating earnings; earnings or losses
or net earnings or losses (including earnings or losses before taxes, before
interest and taxes, or before interest, taxes, depreciation and amortization);
earnings or losses margin percentage or net earnings or losses margin
percentage; economic value-added models or equivalent metrics; comparisons with
various stock market indices; reductions in costs; cash flow (including
operating cash flow and free cash flow) or cash flow per share (before or after
dividends); return on capital (including return on total capital or return on
invested capital); cash flow return on investment; cash flow return on capital;
improvement in or attainment of expense levels or working capital levels,
including cash, inventory and accounts receivable; general and administrative
expense savings; inventory control; operating margin; gross margin; year-end
cash; cash margin; debt reduction; shareholders equity; operating efficiencies;
cost reductions or savings; market share; customer satisfaction; customer
growth; customer retention; employee satisfaction; productivity or productivity
ratios; regulatory achievements (including submitting or filing applications or
other documents with regulatory authorities or receiving approval of any such
applications or other documents); strategic partnerships or transactions
(including in-licensing and out-licensing of intellectual property; establishing
relationships with commercial entities with respect to the marketing,
distribution and sale of the Company’s products (including with group purchasing
organizations, distributors and other vendors); co-development, co-marketing,
profit sharing, joint venture or other similar arrangements); financial ratios,
including those measuring liquidity, activity, profitability or leverage; cost
of capital or assets under management; financing and other capital raising
transactions (including sales of the Company’s equity or debt securities; debt
level; year-end cash position; book value; factoring transactions; competitive
market metrics; timely completion of new product roll-outs; timely launch of new
facilities (such as new store

 

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openings, gross or net); sales or licenses of the Company’s assets, including
its intellectual property, whether in a particular jurisdiction or territory or
globally; or through partnering transactions); royalty income; implementation,
completion or attainment of measurable objectives with respect to research,
development, manufacturing, commercialization, products or projects, production
volume levels, acquisitions and divestitures, succession and hiring projects,
reorganization and other corporate transactions, expansions of specific business
operations and meeting divisional or project budgets; factoring transactions;
and recruiting and maintaining personnel.

(b) The performance goals specified in Section 10.2(a) also may be based solely
by reference to the Company’s consolidated performance, performance of the
Company’s continuing operations, or the performance of a Subsidiary, division,
business segment or business unit of the Company, or based upon the performance
of the Company relative to performance of other companies or upon comparisons of
any of the indicators of Company performance relative to performance of other
companies.

(c) When determining the specific metrics applicable to the performance goals
specified in Section 10.2(a), and calculating the actual results related
thereto, the Committee may exclude the impact of an event or occurrence which
the Committee determines should appropriately be excluded, including without
limitation (i) restructurings, performance attributable to discontinued
operations, extraordinary items, and other unusual or non-recurring charges,
(ii) any event either not directly related to the operations of the Company,
Subsidiary, division, business segment or business unit or not within the
reasonable control of management, or (iii) the cumulative effects of tax or
accounting changes in accordance with U.S. generally accepted accounting
principles.

(d) Such performance goals shall be set by the Committee within the time period
prescribed by, and shall otherwise comply with the requirements of,
Section 162(m) of the Code, and the regulations thereunder.

10.3. Adjustments. Notwithstanding any provision of the Plan (other than
Section 11), with respect to any Restricted Share Award, Restricted Share Unit
Award, Performance Award or Other Share-Based Award that is subject to this
Section 10, the Committee may adjust downwards, but not upwards, the amount
payable pursuant to such Award, and the Committee may not waive the achievement
of the applicable performance goals except to the extent permitted by
Section 162(m) of the Code and the regulations thereunder without causing the
Award to cease to be performance-based.

10.4. Restrictions. The Committee shall have the power to impose such other
restrictions on Awards subject to this Section 10 as it may deem necessary or
appropriate to ensure that such Awards satisfy all requirements for
“performance-based compensation” within the meaning of Section 162(m) of the
Code.

10.5. Limitations on Grants to Individual Participants. Subject to adjustment as
provided in Section 12.2, no Participant may be granted (a) Options or Stock
Appreciation Rights during any 36-month period with respect to more than
5,000,000 Shares or (b) Restricted Share Awards, Restricted Share Unit Awards,
Performance Awards and/or Other Share-Based Awards during any calendar year that
are intended to comply with the performance-based

 

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exception under Code Section 162(m) and are denominated in Shares under which
more than 1,000,000 Shares may be earned for each twelve (12) months in the
Vesting Period or Performance Period. During any calendar year, no Participant
may be granted Performance Awards that are intended to comply with the
performance-based exception under Code Section 162(m) and are denominated in
cash under which more than $3,000,000 may be earned for each twelve (12) months
in the Performance Period. Each of the limitations in this section shall be
multiplied by two (2) with respect to Awards granted to a Participant during the
first calendar year in which the Participant commences employment with the
Company and its Subsidiaries. If an Award is cancelled, the cancelled Award
shall continue to be counted toward the applicable limitation in this section.

11. CHANGE IN CONTROL PROVISIONS

11.1. Impact on Certain Awards. The Committee may, in Award Agreements or
otherwise, provide that in the event of a Change in Control of the Company (as
defined in Section 11.3) (a) Options and Stock Appreciation Rights outstanding
as of the date of the Change in Control shall be cancelled and terminated
without payment if the Fair Market Value of one Share as of the date of the
Change in Control is less than the per Share Option exercise price or Stock
Appreciation Right grant price, and (b) all Performance Awards shall be
(i) considered to be earned and payable based on achievement of performance
goals or based on target performance (either in full or pro rata based on the
portion of Performance Period completed as of the date of the Change in
Control), and any limitations or other restrictions shall lapse and such
Performance Awards shall be immediately settled or distributed or (ii) converted
into Restricted Share or Restricted Share Unit Awards based on achievement of
performance goals or based on target performance (either in full or pro rata
based on the portion of Performance Period completed as of the date of the
Change in Control) that are subject to Section 11.2.

11.2. Assumption or Substitution of Certain Awards. (a) Unless otherwise
provided in an Award Agreement, in the event of a Change in Control of the
Company in which the successor company assumes or substitutes for an Option,
Stock Appreciation Right, Restricted Share Award, Restricted Share Unit Award or
Other Share-Based Award (or in which the Company is the ultimate parent
corporation and continues the Award), if a Participant’s employment with such
successor company (or the Company) or a subsidiary thereof terminates within 24
months following such Change in Control (or such other period set forth in the
Award Agreement, including prior to the Change in Control if applicable) and
under the circumstances specified in the Award Agreement (i) Options and Stock
Appreciation Rights outstanding as of the date of such termination of employment
will immediately vest, become fully exercisable, and may thereafter be exercised
for 24 months (or the period of time set forth in the Award Agreement), (ii) the
restrictions, limitations and other conditions applicable to Restricted Shares
and Restricted Share Units outstanding as of the date of such termination of
employment shall lapse and the Restricted Shares and Restricted Share Units
shall become free of all restrictions, limitations and conditions and become
fully vested, and (iii) the restrictions, limitations and other conditions
applicable to any Other Share-Based Awards or any other Awards shall lapse, and
such Other Share-Based Awards or such other Awards shall become free of all
restrictions, limitations and conditions and become fully vested and
transferable to the full extent of the original grant. For the purposes of this
Section 11.2, an Option, Stock Appreciation Right, Restricted Share Award,
Restricted Share Unit Award or Other Share-Based Award shall be considered
assumed or substituted for if following the Change in Control the Award confers
the

 

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right to purchase or receive, for each Share subject to the Option, Stock
Appreciation Right, Restricted Share Award, Restricted Share Unit Award or Other
Share-Based Award immediately prior to the Change in Control, the consideration
(whether stock, cash or other securities or property) received in the
transaction constituting a Change in Control by holders of Shares for each Share
held on the effective date of such transaction (and if holders were offered a
choice of consideration, the type of consideration chosen by the holders of a
majority of the outstanding Shares); provided, however, that if such
consideration received in the transaction constituting a Change in Control is
not solely common stock of the successor company, the Committee may, with the
consent of the successor company, provide that the consideration to be received
upon the exercise or vesting of an Option, Stock Appreciation Right, Restricted
Share Award, Restricted Share Unit Award or Other Share-Based Award, for each
Share subject thereto, will be solely common stock of the successor company with
a fair market value substantially equal to the per Share consideration received
by holders of Shares in the transaction constituting a Change in Control. The
determination of whether fair market value is substantially equal shall be made
by the Committee in its sole discretion and its determination shall be
conclusive and binding.

(b) Unless otherwise provided in an Award Agreement, in the event of a Change in
Control of the Company to the extent the successor company does not assume or
substitute for an Option, Stock Appreciation Right, Restricted Share Award,
Restricted Share Unit Award or Other Share-Based Award (or in which the Company
is the ultimate parent corporation and does not continue the Award), then
immediately prior to the Change in Control: (i) those Options and Stock
Appreciation Rights outstanding as of the date of the Change in Control that are
not assumed or substituted for (or continued) shall immediately vest and become
fully exercisable, (ii) restrictions, limitations and other conditions
applicable to Restricted Share and Restricted Share Units that are not assumed
or substituted for (or continued) shall lapse and the Restricted Share and
Restricted Share Units shall become free of all restrictions, limitations and
conditions and become fully vested, and (iii) the restrictions, other
limitations and other conditions applicable to any Other Share-Based Awards or
any other Awards that are not assumed or substituted for (or continued) shall
lapse, and such Other Share-Based Awards or such other Awards shall become free
of all restrictions, limitations and conditions and become fully vested and
transferable to the full extent of the original grant.

(c) The Committee, in its discretion, may determine that, upon the occurrence of
a Change in Control of the Company, each Option and Stock Appreciation Right
outstanding shall terminate within a specified number of days after notice to
the Participant, and/or that each Participant shall receive, with respect to
each Share subject to such Option or Stock Appreciation Right, an amount equal
to the excess of the Fair Market Value of such Share immediately prior to the
occurrence of such Change in Control over the exercise price per Share of such
Option and/or Stock Appreciation Right; such amount to be payable in cash, in
one or more kinds of stock or property (including the stock or property, if any,
payable in the transaction) or in a combination thereof, as the Committee, in
its discretion, shall determine.

11.3. Change in Control. For purposes of the Plan, unless otherwise provided in
an Award Agreement, Change in Control means the occurrence of any one of the
following events:

(a) During any twenty-four (24) month period, individuals who, as of the
beginning of such period, constitute the Board (the “Incumbent Directors”) cease
for any reason

 

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to constitute at least a majority of the Board, provided that any person
becoming a director subsequent to the beginning of such period whose election or
nomination for election was approved by a vote of at least 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 by or on behalf of any person other than the
Board shall be deemed to be an Incumbent Director;

(b) Any “person” (as such term is defined in the Exchange Act and as used in
Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a “beneficial
owner” (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing 35% or more of the
combined voting power of the Company’s then outstanding securities eligible to
vote for the election of the Board (the “Company Voting Securities”); provided,
however, that the event described in this Section 11.3(b) shall not be deemed to
be a Change in Control by virtue of any of the following acquisitions: (i) by
the Company or any Subsidiary; (ii) by any employee benefit plan (or related
trust) sponsored or maintained by the Company or any Subsidiary; (iii) by any
underwriter temporarily holding securities pursuant to an offering of such
securities; or (iv) pursuant to a Non-Qualifying Transaction, as defined in
Section 11.3(c);

(c) The consummation of a merger, consolidation, statutory share exchange 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:
(i) more than 50% of the total voting power of (A) the corporation resulting
from such Business Combination (the “Surviving Corporation”), or (B) if
applicable, the ultimate parent corporation that directly or indirectly has
beneficial ownership of 100% of the voting securities eligible to elect
directors of the Surviving Corporation (the “Parent 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; (ii) no person (other than any employee benefit plan (or related
trust) sponsored or maintained by the Surviving Corporation or the Parent
Corporation), is or becomes the beneficial owner, directly or indirectly, of 35%
or more of the total voting power of the outstanding voting securities eligible
to elect directors of the Parent Corporation (or, if there is no Parent
Corporation, the Surviving Corporation); and (iii) at least a majority of the
members of the board of directors of the Parent Corporation (or, if there is no
Parent Corporation, 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 (i), (ii) and (iii) above shall be deemed to be a “Non-Qualifying
Transaction”); or

 

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(d) The consummation of a sale of 50% or more of the total gross fair market
value of the Company’s assets, other than to an entity (or, if applicable, the
ultimate parent corporation that directly or indirectly has beneficial ownership
of 100% of the voting securities eligible to elect directors of such entity)
(i) in which 50% or more of the Voting Securities is represented by Company
Voting Securities that were outstanding immediately prior to such sale or
(ii) of which the Company directly or indirectly owns 50% or more of the Voting
Securities.

Notwithstanding anything contained in this Section 11.3, a Change in Control
shall not be deemed to occur solely because any person acquires beneficial
ownership of more than 35% of the Company Voting Securities as a result of the
acquisition of Company Voting Securities by the Company which reduces the number
of Company Voting Securities outstanding; provided, that if after 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 be deemed to have occurred.

12. GENERALLY APPLICABLE PROVISIONS

12.1. Amendment and Termination of the Plan. The Board may, from time to time,
alter, amend, suspend or terminate the Plan as it shall deem advisable, subject
to any requirement for shareholder approval imposed by applicable law, including
the rules and regulations of the principal U.S. national securities exchange on
which the Shares are traded; provided that the Board may not amend the Plan in
any manner that would result in noncompliance with Rule 16b-3 under the Exchange
Act; and further provided that the Board may not, without the approval of the
Company’s shareholders, amend the Plan to (a) increase the number of Shares that
may be the subject of Awards under the Plan (except for adjustments pursuant to
Section 12.2), (b) expand the types of awards available under the Plan,
(c) materially expand the class of persons eligible to participate in the Plan,
(d) amend Section 5.3 or Section 6.2(f) to eliminate the requirements relating
to minimum exercise price, minimum grant price and shareholder approval,
(e) increase the maximum permissible term of any Option specified by Section 5.4
or the maximum permissible term of a Stock Appreciation Right specified by
Section 6.2(d), or (f) increase any of the limitations in Section 10.5. The
Board may not (except pursuant to Section 12.2 or in connection with a Change in
Control), without the approval of the Company’s shareholders, take any action
with respect to an Option or Stock Appreciation Right that would, if such action
were taken by the Committee, violate section 5.3 or 6.2(f). In addition, no
amendments to, or termination of, the Plan shall impair the rights of a
Participant in any material respect under any Award previously granted without
such Participant’s consent.

12.2. Adjustments. In the event of any merger, reorganization, consolidation,
recapitalization, dividend or distribution (whether in cash, shares or other
property, other than a regular cash dividend), stock split, reverse stock split,
spin-off or similar transaction or other change in corporate structure affecting
the Shares or the value thereof, such adjustments and other substitutions shall
be made to the Plan and to Awards in a manner the Committee deems equitable or
appropriate taking into consideration the accounting and tax consequences,
including such adjustments in the aggregate number, class and kind of securities
that may be delivered under the Plan, the limitations in Section 10.5 (other
than to Awards denominated in cash), the maximum number of Shares that may be
issued pursuant to Incentive Stock Options and, in the aggregate or to any
Participant, in the number, class, kind and option or exercise price

 

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of securities subject to outstanding Awards granted under the Plan (including,
if the Committee deems appropriate, the substitution of similar options to
purchase the shares of, or other awards denominated in the shares of, another
company) as the Committee may determine to be appropriate; provided, however,
that the number of Shares subject to any Award shall always be a whole number,
unless the Committee determines otherwise.

12.3. Transferability of Awards. Except as provided below, no Award and no
Shares that have not been issued or as to which any applicable restriction,
performance or deferral period has not lapsed, may be sold, assigned,
transferred, pledged or otherwise encumbered, other than by will or the laws of
descent and distribution, and such Award may be exercised during the life of the
Participant only by the Participant or the Participant’s guardian or legal
representative. To the extent and under such terms and conditions as determined
by the Committee, a Participant may assign or transfer an Award without
consideration (each transferee thereof, a “Permitted Assignee”) (a) to the
Participant’s spouse, children or grandchildren (including any adopted and step
children or grandchildren), parents, grandparents or siblings, (b) to a trust
for the benefit of one or more of the Participant or the persons referred to in
clause (a), (c) to a partnership, limited liability company or corporation in
which the Participant or the persons referred to in clause (a) are the only
partners, members or shareholders, or (d) for charitable donations; provided
however, that such Permitted Assignee shall be bound by and subject to all of
the terms and conditions of the Plan and the Award Agreement relating to the
transferred Award and shall execute an agreement satisfactory to the Company
evidencing such obligations; and provided further that such Participant shall
remain bound by the terms and conditions of the Plan. The Company shall
cooperate with any Permitted Assignee and the Company’s transfer agent in
effectuating any transfer permitted under this Section.

12.4. Termination of Employment or Services. The Committee shall determine and
set forth in each Award Agreement whether any Awards granted in such Award
Agreement will continue to be exercisable, continue to vest or be earned and the
terms of such exercise, vesting or earning, on and after the date that a
Participant ceases to be employed by or to provide services to the Company or
any Subsidiary (including as a Director), whether by reason of death,
disability, voluntary or involuntary termination of employment or services, or
otherwise. The date of termination of a Participant’s employment or services
will be determined by the Committee, which determination will be final.

12.5. Deferral; Dividend Equivalents. The Committee shall be authorized to
establish procedures pursuant to which the payment of any Award may be deferred.
Subject to the provisions of the Plan and to the extent expressly provided in
the applicable Award Agreement, the recipient of an Award other than an Option
or Stock Appreciation Right may, if so determined by the Committee, be entitled
to receive, currently or on a deferred basis, amounts equivalent to cash, stock
or other property, dividends on Shares (“Dividend Equivalents”) with respect to
the number of Shares covered by the Award, as determined by the Committee in its
sole discretion. The Committee may provide that the Dividend Equivalents (if
any) shall be deemed to have been reinvested in additional Shares or otherwise
reinvested and may provide that the Dividend Equivalents are subject to the same
vesting or performance conditions as the underlying Award. Notwithstanding the
foregoing, Dividend Equivalents credited in connection with an Award that vests
based on the achievement of performance goals shall be subject to restrictions
and risk of forfeiture to the same extent as the Award with respect to which
such Dividend Equivalents have been credited.

 

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13. MISCELLANEOUS

13.1. Award Agreements. Each Award Agreement shall either be (a) in writing in a
form approved by the Committee or Board and executed by the Company by an
officer duly authorized to act on its behalf, or (b) an electronic notice in a
form approved by the Committee or Board and recorded by the Company (or its
designee) in an electronic recordkeeping system used for the purpose of tracking
one or more types of Awards as the Committee may provide; in each case and if
required by the Committee, the Award Agreement shall be executed or otherwise
electronically accepted by the recipient of the Award in such form and manner as
the Committee may require. The Committee may authorize any officer of the
Company to execute any or all Award Agreements on behalf of the Company. The
Award Agreement shall set forth the material terms and conditions of the Award
as established by the Committee or Board consistent with the provisions of the
Plan. The Award Agreement may be amended by agreement of the Company and the
recipient, to the extent approved by the Committee or Board.

13.2. Tax Withholding. The Company shall have the right to make all payments or
distributions pursuant to the Plan to a Participant (or a Permitted Assignee
thereof) net of any applicable federal, state and local taxes required to be
paid or withheld as a result of (a) the grant of any Award, (b) the exercise of
an Option or Stock Appreciation Right, (c) the delivery of Shares or cash,
(d) the lapse of any restrictions in connection with any Award or (e) any other
event occurring pursuant to the Plan. The Company or any Subsidiary shall have
the right to withhold from wages or other amounts otherwise payable to a
Participant (or Permitted Assignee) such withholding taxes as may be required by
law, or to otherwise require the Participant (or Permitted Assignee) to pay such
withholding taxes. If the Participant (or Permitted Assignee) shall fail to make
such tax payments as are required, the Company or its Subsidiaries shall, to the
extent permitted by law, have the right to deduct any such taxes from any
payment of any kind otherwise due to such Participant (or Permitted Assignee) or
to take such other action as may be necessary to satisfy such withholding
obligations. The Committee shall be authorized to establish procedures for
election by Participants (or Permitted Assignees) to satisfy such obligation for
the payment of such taxes by tendering previously acquired Shares (either
actually or by attestation, valued at their then Fair Market Value), or by
directing the Company to retain Shares (up to the minimum required tax
withholding rate for the Participant (or Permitted Assignee) or such other rate
that will not cause an adverse accounting consequence or cost) otherwise
deliverable in connection with the Award.

13.3. Right of Discharge Reserved; Claims to Awards. Nothing in the Plan nor the
grant of an Award hereunder shall confer upon any Employee, Director or
Consultant the right to continue in the employment or service of the Company or
any Subsidiary or affect any right that the Company or any Subsidiary may have
to terminate the employment or service of (or to demote or to exclude from
future Awards under the Plan) any such Employee, Director or Consultant at any
time for any reason. The Company shall not be liable for the loss of existing or
potential profit from an Award granted in the event of termination of an
employment or other relationship. No Employee, Director or Consultant shall have
any claim to be granted any Award under the Plan, and there is no obligation for
uniformity of treatment of Employees, Directors or Consultants under the Plan.

13.4. Substitute Awards. Notwithstanding any other provision of the Plan, the
terms of Substitute Awards may vary from the terms set forth in the Plan to the
extent the Committee deems appropriate to conform, in whole or in part, to the
provisions of the awards in substitution for which they are granted.

 

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13.5. Cancellation of Award; Forfeiture of Gain. Notwithstanding anything to the
contrary contained herein, an Award Agreement may provide that

(a) In the event of an accounting restatement due to material noncompliance by
the Company with any financial reporting requirement under the securities laws,
the Committee shall have the right to review any Award, the amount, payment or
vesting of which was directly or indirectly based on an entry in the financial
statements that are the subject of the restatement. If the Committee determines
that (i) based on the results of the restatement or (ii) due to inaccurate
financial data used to determine the payment or vesting of an Award, that a
lesser amount or portion of an Award should have been paid, vested or realized
(including as a result of the impact of the restatement or inaccurate data on
the Fair Market Value of Shares as determined by the Committee in its
discretion), it may (x) cancel all or any portion of any outstanding Awards and
(y) require the Participant or other person to whom any payment has been made or
shares or other property have been transferred in connection with the Award to
forfeit and pay over to the Company, on demand, all or any portion of the gain
(whether or not taxable) realized upon the exercise of any Option or Stock
Appreciation Right and the value realized (whether or not taxable) on the
vesting or payment of any other Award during the period beginning twelve months
preceding the date of the restatement and ending with the date of Committee
action pursuant to this section of the Plan. In applying this section, the
Committee is not required to treat all Participants in the same manner.

(b) If the Participant, without the consent of the Company, while employed by or
providing services to the Company or any Subsidiary or after termination of such
employment or service, violates a non-competition, non-solicitation or
non-disclosure covenant or agreement, as determined by the Committee in its sole
discretion, then (i) any outstanding, vested or unvested, earned or unearned
portion of the Award may, at the Committee’s discretion, be canceled and
(ii) the Committee, in its discretion, may require the Participant or other
person to whom any payment has been made, or Shares or other property have been
transferred in connection with the Award, to forfeit and pay over to the
Company, on demand, all or any portion of the gain (whether or not taxable)
realized upon the exercise of any Option or Stock Appreciation Right and the
value realized (whether or not taxable) on the vesting or payment of any other
Award during the time period specified in the Award Agreement. Except with
respect to officers who are designated as executive officers by the Company’s
Board of Directors under Section 16 of the Securities Act of 1934, the Committee
shall have the power to delegate all or a portion of the Committee’s authority,
duties and responsibilities under this Section 13.5(b) to one or more executive
officers of the Company, including the authority for such executive officer(s)
to further delegate such authority, duties and responsibilities to any other
individual or entity, whether or not such person or entity is employed by, an
officer of, or affiliated with the Company. Any delegation, including any
delegation made by an executive officer, may be rescinded by the Committee at
any time.

13.6. Stop Transfer Orders. All Shares delivered under the Plan pursuant to any
Award shall be subject to such stop transfer orders and other restrictions as
the Committee may deem advisable under the rules, regulations and other
requirements of the SEC, any stock exchange upon which the Shares are then
listed, and any applicable federal or state securities law, and the Committee
may cause a legend or notation to be put on any certificates or book entries to
make appropriate reference to such restrictions.

 

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13.7. Nature of Payments. All Awards made pursuant to the Plan are in
consideration of services performed or to be performed for the Company or any
Subsidiary, division or business unit of the Company or a Subsidiary. Any income
or gain realized pursuant to Awards under the Plan constitutes a special
incentive payment to the Participant and shall not be taken into account, to the
extent permissible under applicable law, as compensation for purposes of any of
the employee benefit plans of the Company or any Subsidiary except as may be
required by the terms of such plan or determined by the Committee or by the
Board or board of directors of the applicable Subsidiary.

13.8. Other Plans. Nothing contained in the Plan shall prevent the Board from
adopting other or additional compensation arrangements, subject to shareholder
approval if such approval is required; and such arrangements may be either
generally applicable or applicable only in specific cases.

13.9. Severability. The provisions of the Plan shall be deemed severable. If any
provision of the Plan shall be held unlawful or otherwise invalid or
unenforceable in whole or in part by a court of competent jurisdiction or by
reason of change in a law or regulation, such provision shall (a) be deemed
limited to the extent that such court of competent jurisdiction deems it lawful,
valid and/or enforceable and as so limited shall remain in full force and
effect, and (b) not affect any other provision of the Plan or part thereof, each
of which shall remain in full force and effect. If the making of any payment or
the provision of any other benefit required under the Plan shall be held
unlawful or otherwise invalid or unenforceable by a court of competent
jurisdiction or any governmental regulatory agency, or impermissible under the
rules of any securities exchange on which the Shares are listed, such
unlawfulness, invalidity, unenforceability or impermissibility shall not prevent
any other payment or benefit from being made or provided under the Plan, and if
the making of any payment in full or the provision of any other benefit required
under the Plan in full would be unlawful or otherwise invalid or impermissible,
then such unlawfulness, invalidity, unenforceability or impermissibility shall
not prevent such payment or benefit from being made or provided in part, to the
extent that it would not be unlawful, invalid, unenforceable or impermissible,
and the maximum payment or benefit that would not be unlawful, invalid,
unenforceable or impermissible shall be made or provided under the Plan.

13.10. Construction. As used in the Plan, the words “include” and “including,”
and variations thereof, shall not be deemed to be terms of limitation, but
rather shall be deemed to be followed by the words “without limitation.”

13.11. Unfunded Status of the Plan. The Plan is intended to constitute an
“unfunded” plan for incentive compensation. With respect to any payments not yet
made to a Participant by the Company, nothing contained herein shall give any
such Participant any rights that are greater than those of a general creditor of
the Company. In its sole discretion, the Committee may authorize the creation of
trusts or other arrangements to meet the obligations created under the Plan to
deliver the Shares or payments in lieu of or with respect to Awards hereunder;
provided, however, that the existence of such trusts or other arrangements is
consistent with the unfunded status of the Plan.

 

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13.12. Governing Law. The Plan and all determinations made and actions taken
thereunder, to the extent not otherwise governed by the Code or the laws of the
United States, shall be governed by the laws of the State of Missouri, without
reference to principles of conflict of laws, and construed accordingly.

13.13. Effective Date of Plan; Termination of Plan. The Plan shall be effective
on the later of January 1, 2013 or the date of the approval of the Plan by the
holders of the shares entitled to vote at a duly constituted meeting of the
shareholders of the Company. The Plan shall be null and void and of no effect if
the foregoing condition is not fulfilled and in such event each Award shall,
notwithstanding any of the preceding provisions of the Plan, be null and void
and of no effect. Awards may be granted under the Plan at any time and from time
to time on or prior to the tenth anniversary of the effective date of the Plan,
on which date the Plan will expire except as to Awards then outstanding under
the Plan; provided, however, in no event may an Incentive Stock Option be
granted more than ten (10) years after the earlier of (a) the date of the
adoption of the Plan by the Board or (b) the effective date of the Plan as
provided in the first sentence of this Section. Such outstanding Awards shall
remain in effect until they have been exercised or terminated, or have expired.

13.14. Foreign Employees and Consultants. Awards may be granted to Participants
who are foreign nationals or employed or providing services outside the United
States, or both, on such terms and conditions different from those applicable to
Awards to Employees or Consultants providing services in the United States as
may, in the judgment of the Committee, be necessary or desirable in order to
recognize differences in local law or tax policy. The Committee also may impose
conditions on the exercise or vesting of Awards in order to minimize the
Company’s obligation with respect to tax equalization for Employees or
Consultants on assignments outside their home country.

13.15. Compliance with Section 409A of the Code. It is intended that Awards
shall not result in, and that this Plan and Awards shall be administered in a
manner that does not result in, the imposition of any taxes, interest or
penalties as a result of Section 409A of the Code and regulations and other
guidance issued with respect thereto (any such taxes, interest or penalties
shall be a “409A Penalty”) and this Plan and Awards shall be construed and
interpreted in accordance with such intent. To the extent that an Award or the
payment, settlement or deferral thereof is subject to Section 409A of the Code,
the Award shall be granted, paid, settled or deferred in a manner that will not
result in a 409A Penalty, except as otherwise determined by the Committee. Any
provision of this Plan that would cause the grant of an Award or the payment,
settlement or deferral thereof to result in a 409A Penalty shall be amended so
as not to result in or to minimize a 409A Penalty on a timely basis, which may
be made on a retroactive basis, in accordance with regulations and other
guidance issued under Section 409A of the Code. Notwithstanding the requirements
of this Section, in no event will the Company or any affiliate thereof
(including the Committee) have any liability to any Participant with respect to
any 409A Penalty even if there is a failure on the part of the Company or
Committee to avoid or minimize a 409A Penalty.

13.16. No Registration Rights; No Right to Settle in Cash. The Company has no
obligation to register with any governmental body or organization (including,
without limitation, the SEC) any of (a) the offer or issuance of any Award,
(b) any Shares issuable upon the exercise of any Award, or (c) the sale of any
Shares issued upon exercise of any Award, regardless of

 

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whether the Company in fact undertakes to register any of the foregoing. In
particular, in the event that any of (x) any offer or issuance of any Award,
(y) any Shares issuable upon exercise of any Award, or (z) the sale of any
Shares issued upon exercise of any Award are not registered with any
governmental body or organization (including, without limitation, the SEC), the
Company will not under any circumstance be required to settle its obligations,
if any, under this Plan in cash.

13.17. Data Privacy. As a condition of acceptance of an Award, the Participant
explicitly and unambiguously consents to the collection, use and transfer, in
electronic or other form, of personal data as described in this Section by and
among, as applicable, the Company and its Subsidiaries for the exclusive purpose
of implementing, administering and managing the Participant’s participation in
the Plan. The Participant understands that the Company and its Subsidiaries hold
certain personal information about the Participant, including the Participant’s
name, home address and telephone number, date of birth, social insurance number
or other identification number, salary, nationality, job title, any shares of
stock or directorships held in the Company or any Subsidiary, details of all
Awards or any other entitlement to Shares awarded, canceled, exercised, vested,
unvested or outstanding in the Participant’s favor, for the purpose of
implementing, managing and administering the Plan (the “Data”). The Participant
further understands that the Company and its Subsidiaries may transfer the Data
amongst themselves as necessary for the purpose of implementation, management
and administration of the Participant’s participation in the Plan, and that the
Company and its Subsidiaries may each further transfer the Data to any third
parties assisting the Company in the implementation, management, and
administration of the Plan. The Participant understands that these recipients
may be located in the Participant’s country, or elsewhere, and that the
recipient’s country may have different data privacy laws and protections than
the Participant’s country. The Participant understands that he or she may
request a list with the names and addresses of any potential recipients of the
Data by contacting his or her local human resources representative. The
Participant, through participation in the Plan and acceptance of an Award under
the Plan, authorizes such recipients to receive, possess, use, retain and
transfer the Data, in electronic or other form, for the purposes of
implementing, administering and managing the Participant’s participation in the
Plan, including any requisite transfer of such Data as may be required to a
broker or other third party with whom the Participant may elect to deposit any
Shares. The Participant understands that the Data will be held only as long as
is necessary to implement, manage, and administer the Participant’s
participation in the Plan. The Participant understands that he or she may, at
any time, view the Data, request additional information about the storage and
processing of the Data, require any necessary amendments to the Data, or refuse
or withdraw the consents herein in writing, in any case without cost, by
contacting his or her local human resources representative. The Participant
understands that refusal or withdrawal of consent may affect the Participant’s
ability to participate in the Plan. For more information on the consequences of
refusal to consent or withdrawal of consent, the Participant understands that he
or she may contact his or her local human resources representative.

13.18. Indemnity. To the extent allowable pursuant to applicable law, each
member of the Committee or of the Board and any person to whom the Committee has
delegated any of its authority under the Plan shall be indemnified and held
harmless by the Company from any loss, cost, liability, or expense that may be
imposed upon or reasonably incurred by such person in connection with or
resulting from any claim, action, suit, or proceeding to which he or she may be
a party or in which he or she may be involved by reason of any action or failure
to act

 

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pursuant to the Plan and against and from any and all amounts paid by him or her
in satisfaction of judgment in such action, suit, or proceeding against him or
her; provided he or she gives the Company an opportunity, at its own expense, to
handle and defend the same before he or she undertakes to handle and defend it
on his or her own behalf. The foregoing right of indemnification shall not be
exclusive of any other rights of indemnification to which such persons may be
entitled pursuant to the Company’s Certificate of Incorporation or Bylaws, as a
matter of law, or otherwise, or any power that the Company may have to indemnify
them or hold them harmless.

13.19. Captions. The captions in the Plan are for convenience of reference only,
and are not intended to narrow, limit or affect the substance or interpretation
of the provisions contained herein.

 

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