Exhibit 10(b)

 

HUNTINGTON BANCSHARES INCORPORATED

2004 STOCK AND LONG-TERM INCENTIVE PLAN

 

ARTICLE 1. ESTABLISHMENT, EFFECTIVE DATE, AND TERM

 

1.1 ESTABLISHMENT OF THE PLAN. Huntington Bancshares Incorporated, a Maryland
corporation (hereinafter referred to as the “Corporation”), has established a
long-term incentive compensation plan to be known as the “Huntington Bancshares
Incorporated 2004 Stock and Long-Term Incentive Plan” (hereinafter referred to
as the “Plan”), as set forth in this document. The Plan permits the grant of
Nonqualified Stock Options, Incentive Stock Options, Restricted Stock,
Restricted Stock Units, Stock Appreciation Rights, Deferred Stock, and Long-Term
Performance Awards.

 

1.2 EFFECTIVE DATE. The Plan, if approved by the majority of the votes cast by
the Corporation’s stockholders at the annual meeting on April 27, 2004, shall
become effective January 1, 2004 (the “Effective Date”), for Long-Term
Performance Awards with cycles beginning on or after January 1, 2004, and for
grants of Nonqualified Stock Options, Incentive Stock Options, Restricted Stock,
Restricted Stock Units, Stock Appreciation Rights, and Deferred Stock beginning
on or after April 27, 2004. The Plan shall remain in effect as provided in
Article 1.4 herein. No Awards will be made under the Plan unless shareholder
approval is obtained.

 

1.3 OBJECTIVES OF THE PLAN. The objectives of the Plan are to help optimize the
profitability and growth of the Corporation through incentives which are
consistent with the Corporation’s objectives and which link the interests of
Participants to those of the Corporation’s stockholders; to induce Participants
to strive for the highest level of performance; and to promote teamwork among
Participants.

 

The Plan is further intended to provide flexibility to the Corporation in its
ability to motivate, attract, and retain the services of Participants who make
significant contributions to the Corporation’s success and the creation of
shareholder value and to allow Participants to share in the success of the
Corporation.

 

1.4 DURATION OF THE PLAN. The Plan shall commence on the Effective Date, as
described in Article 1.2 herein, and shall remain in effect, subject to the
right of the Board of Directors (“Board”), or a Committee delegated by the
Board, to amend or terminate the Plan at any time pursuant to Article 18 herein.
However, in no event may an Award be granted under the Plan on or after December
31, 2013.

 

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ARTICLE 2. DEFINITIONS OF TERMS

 

As used in the Plan, the following words shall have the meanings stated after
them, unless otherwise specifically provided. In the Plan, words used in the
singular shall include the plural, and words used in the plural shall include
the singular. The gender of words used in this Plan shall include whatever may
be appropriate under any particular circumstances.

 

2.1 “AWARD” means, individually or collectively, a grant under this Plan of
Nonqualified Stock Options, Incentive Stock Options, Restricted Stock,
Restricted Stock Units, Stock Appreciation Rights, Deferred Stock Awards, or a
Long-Term Performance Award.

 

2.2 “AWARD AGREEMENT” means a written statement prepared by the Corporation
setting forth the terms and provisions applicable to Awards granted under this
Plan.

 

2.3 “BENEFICIAL OWNER” shall have the meaning ascribed to such term in Rule
13d-3 of the General Rules and Regulations under the Exchange Act.

 

2.4 “BOARD” OR “BOARD OF DIRECTORS” means the Board of Directors of the
Corporation.

 

2.5 “CHANGE IN CONTROL” means, with respect to the Corporation, the occurrence
of any of the following:

 

(a) Any “person” (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act as in effect as of the date of this Agreement), other than the
Corporation or any “person” who as of the Effective Date is a director or
officer of the Corporation or whose shares of Common Stock of the Corporation
are treated as “beneficially owned” (as such term is used in Rule 13d-3 of the
Exchange Act as in effect as of the Effective Date) by any such director or
officer, becomes the beneficial owner, directly or indirectly, of securities of
the Corporation representing twenty-five percent (25%) or more of the combined
voting power of the Corporation’s then outstanding securities;

 

(b) Individuals who, as of the Effective Date, constitute the Board of Directors
of the Corporation (the “Incumbent Board”) cease for any reason to constitute at
least a majority of the Board, provided, however, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for
election, was approved by a vote of at least a majority of the directors
comprising the Incumbent Board shall be considered as though such individual
were a member of the Incumbent Board, but excluding for this purpose any such
individual whose initial assumption of office occurs as a result of either an
actual or threatened election contest (as such terms are used in Regulation 14A
promulgated under the Exchange Act) or other actual or threatened solicitation
of proxies or consents by or on behalf of a person other than the Board;

 

(c) A merger or consolidation of the Corporation, other than a merger or
consolidation in which the voting securities of the Corporation immediately
prior to the merger or consolidation continue to represent (either by remaining
outstanding or being converted into securities of the surviving entity)
fifty-one percent (51%) or more of the combined voting power of the

 

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Corporation or surviving entity immediately after the merger or consolidation
with another entity;

 

(d) A sale, exchange, lease, mortgage, pledge, transfer, or other disposition
(in a single transaction or a series of related transactions) of all or
substantially all of the assets of the Corporation which shall include, without
limitation, the sale of assets or earning power aggregating more than fifty
percent (50%) of the assets or earning power of the Corporation on a
consolidated basis;

 

(e) A liquidation or dissolution of the Corporation;

 

(f) A reorganization, reverse stock split, or recapitalization of the
Corporation which would result in any of the foregoing; or

 

(g) A transaction or series of related transactions having, directly or
indirectly, the same effect as any of the foregoing.

 

2.6 “CAUSE” means any of the following:

 

(a) The Participant shall have committed a felony or an intentional act of gross
misconduct, moral turpitude, fraud, embezzlement, or theft in connection with
the Participant’s duties or in the course of the Participant’s employment with
the Corporation or any Subsidiary, and the Corporation shall have determined
that such act is materially harmful to the Corporation;

 

(b) The Corporation or any Subsidiary shall have been ordered or directed by any
federal or state regulatory agency with jurisdiction to terminate or suspend the
Participant’s employment and such order or directive has not been vacated or
reversed upon appeal; or

 

(c) After being notified in writing by the Corporation to cease any particular
competitive activity, the Participant shall have continued such competitive
activity and the Corporation shall have determined that such act is materially
harmful to the Corporation.

 

2.7 “CODE” means the Internal Revenue Code of 1986, as amended from time to
time.

 

2.8 “COMMITTEE” means the Compensation Committee of the Board, as specified in
Article 3 herein, or such other committee appointed by the Board to administer
the Plan. For purposes of granting, administering and certifying Awards to
Covered Employees, the Committee or any sub-committee acting on behalf of the
Committee shall be composed of two (2) or more directors each of whom is an
“outside director” within the meaning of Code Section 162(m). Any Committee
member who is not an “outside director” within the meaning of Code Section
162(m) shall abstain from participating in any decision to grant, administer or
certify Awards to Covered Employees.

 

2.9 “CORPORATION” means Huntington Bancshares Incorporated, a Maryland
corporation, together with any and all Subsidiaries, and any successor thereto
as provided in Article 22 herein.

 

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2.10 “COVERED EMPLOYEE” means any Participant who is designated as a Covered
Employee by the Committee because it is anticipated that his or her compensation
may exceed the limit under Code Section 162(m) and for whom any Award is
intended to satisfy the Performance-Based Exception.

 

2.11 “DEFERRAL PERIOD” means the period of time during which Deferred Stock is
subject to deferral limitations under Article 10 herein.

 

2.12 “DEFERRED STOCK” means an Award granted to a Participant pursuant to
Article 10 herein of the right to receive Shares at the end of a specified
Deferral Period.

 

2.13 “DIRECTOR” means any individual who is a member of the Board of Directors
of the Corporation.

 

2.14 “EFFECTIVE DATE” shall have the meaning ascribed to such term in Article
1.1 herein.

 

2.15 “EMPLOYEE” means any employee of the Corporation. Directors who are not
employed by the Corporation shall not be considered Employees under this Plan.

 

2.16 “EXCHANGE ACT” means the Securities Exchange Act of 1934, as amended from
time to time, or any successor act thereto.

 

2.17 “EXTRAORDINARY EVENTS” means, with respect to the Corporation, any of the
following (i) changes in tax law, generally accepted accounting principles or
other such laws or provisions affecting reported financial results, (ii)
accruals for reorganization and restructuring programs, (iii) special gains or
losses in connection with the mergers and acquisitions or on the sales of
branches or significant portions of the Corporation, (iv) any extraordinary
non-recurring items as described in Accounting Principles Board Opinion No. 30
and/or in management’s discussion and analysis of financial condition and
results of operation appearing or incorporated by reference in the annual report
on Form 10-K filed with the Securities and Exchange Commission, (v) gains on
sales of auto loans, (vi) losses on the early repayment of debt, or (vii) any
other events or occurrences of a similar nature as determined by the Committee.

 

2.18 “FAIR MARKET VALUE” shall be, on any given date, (1) the mean between the
highest and lowest selling prices at which the Shares were sold on the NASDAQ
National Market or such other established securities market on which the Shares
are traded, or, if there were no reported sales of Shares on such date, then,
unless otherwise required pursuant to Treasury regulations under Code Section
422, the business day immediately preceding such date; or (2) the price that the
Committee in good faith determines through any reasonable valuation method that
a Share might change hands between a willing buyer and a willing seller, neither
being under compulsion to buy or to sell and both having reasonable knowledge of
the relevant facts. Notwithstanding the above, for purposes of
broker-facilitated cashless exercises of Awards involving Shares under the Plan,
“Fair Market Value” shall mean the real-time selling price of such Shares as
reported by the broker facilitating such exercises.

 

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2.19 “INCENTIVE STOCK OPTION” OR “ISO” means an option to purchase Shares
granted under Article 6 herein and which is designated as an Incentive Stock
Option and which is intended to meet the requirements of Code Section 422.

 

2.20 “IMMEDIATE FAMILY” means, with respect to a particular Participant, such
Participant’s child, stepchild, grandchild, parent, stepparent, grandparent,
spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law,
brother-in-law, or sister-in-law, and shall include adoptive relationships.

 

2.21 “INSIDER” shall mean any person subject to the reporting requirements of
Section 16 of the Exchange Act.

 

2.22 “LONG-TERM PERFORMANCE AWARD” means an Award to a Participant pursuant to
Article 11 herein.

 

2.23 “NONEMPLOYEE DIRECTOR” means an individual who is a member of the Board of
Directors of the Corporation but who is not an Employee of the Corporation.

 

2.24 “NONQUALIFIED STOCK OPTION” OR “NQSO” means an option to purchase Shares
granted under Article 6 herein and which is not intended to meet the
requirements of Code Section 422.

 

2.25 “OPTION” means an Incentive Stock Option, or a Nonqualified Stock Option
granted to a Participant pursuant to Article 6 herein.

 

2.26 “OPTION PRICE” means the price at which a Share may be purchased by a
Participant pursuant to an Option.

 

2.27 “PARTICIPANT” means an Employee or, solely with respect to a Nonqualified
Stock Option Award, Restricted Stock Award, Restricted Stock Unit Award, or a
Deferred Stock Award, a Nonemployee Director who has an outstanding Award
granted under the Plan.

 

2.28 “PERFORMANCE-BASED EXCEPTION” means the performance-based exception from
the tax deductibility limitations of Code Section 162(m).

 

2.29 “PERFORMANCE CYCLE” shall mean the two, three, or four calendar year period
designated by the Committee during which the performance objectives or goals
must be met.

 

2.30 “PERMISSIBLE TRANSFEREE” means any member of the Immediate Family of the
Participant, any trust solely for the benefit of the Participant or members of
the Participant’s Immediate Family, or any partnership whose only partners are
members of the Participant’s Immediate Family.

 

2.31 “PERIOD OF RESTRICTION” means the period during which the transfer of
Shares of Restricted Stock or Restricted Stock Units is limited in some way
(based on the passage of

 

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time, which, unless waived by the Committee, shall not be less than six (6)
months from the date of grant, the achievement of performance objectives, or
upon the occurrence of other events as determined by the Committee, in its
discretion), and the Shares or RSUs are subject to a substantial risk of
forfeiture, as provided in Article 7 and Article 8 herein.

 

2.32 “PERSON” shall have the meaning ascribed to such term in Section 3(a)(9) of
the Exchange Act and used in Sections 13(d) and 14(d) thereof, including a
“group” as described in Section 13(d) thereof.

 

2.33 “QUALIFYING PERFORMANCE CRITERIA” means any one or more of the following
objective performance criteria (either individually, alternatively, or in any
combination, applied to either the Corporation as a whole or to a business unit
or subsidiary, individually, alternatively, or in any combination and measured
over a period of years, on an absolute basis, or relative to a pre-established
target, to previous years’ results, or to a designated comparison group, in each
case as specified by the Committee) upon which the achievement of specific,
pre-established, objective performance goals for each Participant are based as
determined by the Committee in connection with the grant and certification of
Awards: (a) net income, (b) earnings per share, (c) return on equity, (d) return
on average equity, (e) return on assets, (f) return on average assets, (g)
“efficiency ratio” determined as the ratio of total non-interest operating
expenses (less amortization of intangibles) divided by total revenues (less net
security gains), (h) non-interest income to total revenue ratio, (i) net
interest margin, or (j) other strategic milestones based on objective criteria
established by the Committee, provided that, with respect to Covered Employees,
such strategic milestones must be approved by the shareholders of the
Corporation prior to the payment of any Award. Qualifying Performance Criteria
may be different for different Participants, as determined in the discretion of
the Committee. The Committee may include or exclude Extraordinary Events or any
other objective events or occurrences in determining whether a performance goal
based on the Qualifying Performance Criteria has been achieved; provided,
however, that the Committee shall not have the discretion to increase the amount
of an Award that would otherwise be due to a Participant who is a Covered
Employee based on such Covered Employee’s pre-established performance goals for
the applicable Performance Cycle.

 

2.34 “RESTRICTED STOCK” means an Award granted to a Participant pursuant to
Article 7 herein.

 

2.35 “RESTRICTED STOCK UNIT” OR “RSU” means an Award granted to a Participant
pursuant to Article 8 herein and which is settled (i) by the delivery of one (1)
Share for each RSU, (ii) in cash in an amount equal to the Fair Market Value of
one (1) Share for each RSU, or (iii) in a combination of cash and Shares, as
determined by the Committee. The Award of an RSU represents the promise of the
Corporation to deliver Shares, cash, or a combination thereof, as applicable, at
the end of the Period of Restriction (or such later date as determined by the
Committee) in accordance with and subject to the terms and conditions of the
applicable Award Agreement, and is not intended to constitute a transfer of
property within the meaning of Code Section 83(b).

 

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2.36 “RETIREMENT” shall mean, in the case of an Employee, the retirement from
the employ of the Corporation under one or more of the retirement plans of the
Corporation, or as otherwise specified by the Committee and, in the case of a
Nonemployee Director, shall mean the retirement from the Board at any time after
the Nonemployee Director attains age fifty-five (55) and has served at least
five (5) years as a Director.

 

2.37 “SHARES” means the shares of common stock of the Corporation.

 

2.38 “STOCK APPRECIATION RIGHT” OR “SAR” means an Award, granted alone or in
connection with a related Option, designated as a SAR, pursuant to Article 9
herein.

 

2.39 “SUBSIDIARY or “SUBSIDIARIES” means any corporation or other entity whose
financial statements are consolidated with the Corporation.

 

ARTICLE 3. ADMINISTRATION

 

3.1 AUTHORITY OF THE COMMITTEE. The Plan shall be administered by the Committee,
except as limited by law or by the Charter or Bylaws of the Corporation, and
subject to the provisions herein, the Committee shall have full power to select
the Participants who shall participate in the Plan; determine the sizes and
types of Awards; determine the terms and conditions of Awards in a manner
consistent with the Plan; construe and interpret the Plan and any agreement or
instrument entered into under the Plan as they apply to Participants; establish,
amend, or waive rules and regulations for the Plan’s administration as they
apply to Participants; and (subject to the provisions of Article 18 herein)
amend the terms and conditions of any outstanding Award to the extent such terms
and conditions are within the discretion of the Committee as provided in the
Plan. The Committee may correct any defect, supply any omission or reconcile any
inconsistency in the Plan or any Award in the manner and to the extent it shall
deem desirable to carry the Plan into effect. Further, the Committee shall make
all other determinations which may be necessary or advisable for the
administration of the Plan. As permitted by law, the Committee may delegate its
authority as identified herein, except that to the extent such delegation is not
permitted under Code Section 162(m) and the regulations thereunder.

 

3.2 DECISIONS BINDING. All determinations and decisions made by the Committee
pursuant to the provisions of the Plan and all related orders and resolutions of
the Board (provided, however, that only the Committee, or any subcommittee
thereof, made up solely of 2 or more “outside directors” within the meaning of
Code Section 162(m) shall participate in any decision, order or resolution to
grant, administer, or certify Awards to Covered Employees) shall be final,
conclusive, and binding on all persons, including the Corporation, its
stockholders, Employees, Participants, and their estates and beneficiaries.

 

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ARTICLE 4. SHARES SUBJECT TO THE PLAN AND MAXIMUM AWARDS

 

4.1 NUMBER OF SHARES AVAILABLE FOR GRANTS AND MAXIMUM AWARDS. Subject to
adjustment as provided in this Article 4 herein, the maximum aggregate number of
Shares hereby reserved for issuance to Participants under the Plan shall be
twelve million (12,000,000) Shares. The Shares issued under the Plan may be
authorized and unissued Shares, Shares purchased on the open market, or Shares
held as treasury stock.

 

The following rules shall apply to grants of Awards under the Plan:

 

(a) The maximum aggregate number of Shares which may be subject to (1) option by
one or more Option Awards pursuant to Article 6, (2) one or more SAR Awards
(whether settled in cash, Shares) pursuant to Article 9, or (3) any combination
of Option Awards or SAR Awards to a Participant shall be four million
(4,000,000) Shares over any five (5) year period.

 

(b) The maximum aggregate cash Award or cash equivalent value of an Award of
Shares that may be paid with respect to any specified Performance Cycle to a
Participant pursuant to any Long-Term Performance Award pursuant to Article 11
shall be four million dollars ($4,000,000).

 

(c) The maximum aggregate cash equivalent value of (1) Awards of Restricted
Stock pursuant to Article 7, (2) Awards of RSUs pursuant to Article 8 (whether
settled in cash, Shares, or a combination thereof), (3) Awards of Deferred Stock
pursuant Article 10, or (4) any combination thereof that may be awarded to a
Participant for any calendar year shall be four million dollars ($4,000,000).

 

(d) The maximum aggregate number of (1) Shares of Restricted Stock awarded
pursuant to Article 7, (2) Shares subject to an Award of RSUs pursuant to
Article 8, (3) Shares of Deferred Stock awarded pursuant to Article 10, and (4)
Long-Term Performance Award Shares awarded pursuant to Article 11 shall not
exceed two million four hundred thousand (2,400,000) Shares authorized for
issuance pursuant to this Article 4.1, subject to adjustment under Article 4.3,
over the term of the Plan; provided, however, that the limitation of this
subparagraph (d) shall not apply to any Restricted Stock Awards, RSU Awards,
Deferred Stock Awards, or Long-Term Performance Awards to the extent earned on
the basis of specific performance goals established by the Committee.

 

4.2 LAPSED AWARDS. If any Award granted under this Plan terminates, expires, or
lapses for any reason, any Shares subject to such Award shall again be available
for a grant of an Award under the Plan.

 

4.3 ADJUSTMENTS IN AUTHORIZED SHARES. In the event of any change in the number
of outstanding Shares through the declaration and payment of a stock dividend or
stock split, spin off, merger, or other reorganization, or through any
recapitalization resulting in the combination or exchange of Shares in which the
Corporation does not receive any consideration, a corresponding adjustment shall
be made in the number of Shares which may be delivered under Article 4.1 and in
the number and/or price of Shares subject to outstanding Awards granted under
the Plan; provided, however, that the number of Shares subject to any Award
shall always be a

 

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whole number (by rounding down); provided, further, that the Committee shall, in
its sole discretion, make any further adjustments as are necessary to prevent
dilution or enlargement of rights.

 

Further, unless otherwise required by applicable law or regulation, Shares
granted through the assumption of or in substitution for outstanding awards
granted by a company that is merged or consolidated with, or acquired by, the
Company shall not be subject to the Share limitations of Article 4.1.

 

ARTICLE 5. ELIGIBILITY AND PARTICIPATION

 

5.1 ELIGIBILITY. Persons eligible to participate in this Plan include any
Employee and Nonemployee Director of the Corporation, including any Employee who
is a member of the Board.

 

5.2 ACTUAL PARTICIPATION. Subject to the provisions of the Plan, the Committee
may, from time to time, select from all eligible Employees and Nonemployee
Directors, those to whom Awards shall be granted and shall determine the nature
and amount of each Award.

 

ARTICLE 6. STOCK OPTIONS

 

6.1 GRANT OF OPTIONS. Subject to the terms and provisions of the Plan, Options
may be granted to Participants in such number, and upon such terms, and at any
time and from time to time as shall be determined by the Committee.

 

No Option shall be granted to any Employee or Nonemployee Director if, upon the
granting of such Option, the number of Shares then subject to all Options to
purchase held by the Employee or Nonemployee Director, as the case may be, plus
the Shares then owned by such Employee or Nonemployee Director, would constitute
more than ten (10%) of the total combined voting power of all classes of stock
of the Corporation. For the purpose of the preceding sentence, an Employee or a
Nonemployee Director shall be deemed to own all Shares which are attributable to
him or her under Section 424(d) of the Code, including, without limiting the
generality of the foregoing, shares owned by his or her brothers, sisters,
spouse, ancestors, and lineal descendants.

 

The Committee may not grant ISOs under the Plan to any Employee which would
permit the aggregate Fair Market Value (determined on the date of grant) of
Shares with respect to which ISOs (under this and any other Plan of the
Corporation) are exercisable for the first time by such Employee during any
calendar year to exceed one hundred thousand dollars ($100,000). Any excess
shall be deemed a NQSO. No ISO shall be granted to a Nonemployee Director.

 

If Shares acquired upon exercise of an Incentive Stock Option are disposed of by
a Participant prior to the expiration of either two (2) years from the date of
grant of such Incentive Stock Option or one year from the transfer of Shares to
such Participant pursuant to the exercise of such Incentive Stock Option, or in
any other disqualifying disposition within the meaning of

 

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Section 422 of the Code, such Participant shall notify the Corporation in
writing of the date and terms of such disposition and shall cooperate with the
Corporation with respect to any tax withholding required or resulting from such
disqualifying dispositions. A disqualifying disposition by a Participant shall
not affect the status of any other Incentive Stock Option granted under the Plan
as an Incentive Stock Option.

 

6.2 AWARD AGREEMENT. Each Option grant shall be evidenced by an Award Agreement
that shall specify the Option Price, the duration of the Option, the number of
Shares to which the Option pertains, the date of grant, vesting restrictions, if
any, and such other provisions as the Committee shall determine. The Award
Agreement also shall specify whether the Option is intended to be an ISO or an
NQSO.

 

6.3 OPTION PRICE. The Option Price for each grant of an Option under this Plan
shall be determined by the Committee but shall be at least equal to one hundred
percent (100%) of the Fair Market Value of a Share on the date the Option is
granted; provided, however, that for Options granted through the assumption of
or in substitution for outstanding awards granted by a company that is merged or
consolidated with, or acquired by, the Company, the Option Price shall be
determined by the Committee in its sole discretion and, if applicable,
consistent with Code Section 424(a).

 

6.4 DURATION OF OPTIONS. Each Option granted to an Employee or Nonemployee
Director shall expire at such time as the Committee shall determine at the time
of grant; provided, however, that no Option shall be exercisable on or later
than the tenth (10th) anniversary date of its grant.

 

6.5 EXERCISE OF OPTIONS. Except as otherwise provided in this Plan, Options
granted under this Article 6 shall be exercisable at such times and be subject
to such restrictions and conditions as the Committee shall in each instance
determine, which need not be the same for each grant or for each Participant.
Options granted under this Article 6 shall be exercised by the delivery to the
Corporation of written or other notice acceptable to the Corporation setting
forth the number of Shares with respect to which the Option is to be exercised.

 

The Option Price upon exercise of any Option shall be payable to the Corporation
in full either: (a) in cash or its equivalent; (b) by tendering previously
acquired Shares, including by attestation, having an aggregate Fair Market Value
equal to the total Option Price (provided that the Shares which are tendered
must have been held by the Participant for at least six (6) months prior to
their tender); (c) by a combination of (a) and (b); (d) subject to applicable
securities laws and restrictions, through a broker-facilitated cashless exercise
procedure acceptable to the Committee, or (e) by any other means which the
Committee determines to be consistent with the Plan’s purpose and applicable
law.

 

6.6 RESTRICTIONS ON SHARE TRANSFERABILITY. In addition to the foregoing, the
Committee may impose such restrictions on any Shares acquired pursuant to the
exercise of an Option granted under this Article 6 as it may deem advisable,
including, without limitation, restrictions under applicable Federal securities
laws, under the requirements of any stock

 

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exchange or market upon which such Shares are then listed and/or traded, and
under any blue sky or state securities laws applicable to such Shares.

 

6.7 EXERCISE UPON TERMINATION OF EMPLOYMENT. Except as otherwise provided in
this Plan or as otherwise provided in the Award Agreement or by the Committee,
in the event that the employment of a Participant is terminated for any reason
other than death or Retirement, the rights under each then outstanding Option
granted to the Participant pursuant to the Plan shall terminate upon the earlier
of (1) the expiration of such Option, or (2) sixty (60) days after the
Participant’s termination of employment, unless such termination of employment
was for Cause. If a Participant’s employment is terminated for Cause, the rights
under each then outstanding Option granted to the Participant pursuant to the
Plan shall immediately terminate.

 

In the event that the employment of a Participant is terminated by reason of
Retirement, each then outstanding Option of such Participant shall continue to
be exercisable at such times and be subject to such restrictions and conditions,
including expiration, as set forth in the applicable Award Agreement.
Notwithstanding any other provision in the Plan to the contrary, in the event of
the Retirement of a Participant, each then outstanding ISO not exercised within
three (3) months of termination of employment shall automatically convert to an
NQSO.

 

In the event that the employment of a Participant is terminated by reason of
death or a Participant dies after Retirement, all such Participant’s then
outstanding Options shall become exercisable in full, and the executor or
administrator of such Participant’s estate or a person or persons who have
acquired the Options directly from such Participant by bequest, inheritance, or
by reason of written designation as a beneficiary on a form proscribed by the
Corporation, shall have until the expiration dates of such Options or thirteen
(13) months after the Participant’s date of death, whichever first occurs, to
exercise such Options.

 

In addition to the foregoing, the Committee may include such provisions in the
Award Agreement entered into with each Participant as it deems advisable (which
may be more restrictive than described above), which provisions need not be
uniform among all Options issued pursuant to this Article 6, and which may
reflect distinctions based on the reasons for termination of employment.

 

6.8 EXERCISE UPON TERMINATION OF DIRECTORSHIP. Except as otherwise provided in
this Plan, if a Participant’s status as a Nonemployee Director ceases for any
reason other than Retirement or death, any NQSO granted to such Participant
under the Plan shall terminate thirteen (13) months after the termination of
such Participant’s status as a Nonemployee Director; provided, however, that no
Option shall be exercisable after its expiration date.

 

If a Participant’s status as a Nonemployee Director ceases by reason of
Retirement, then all such Participant’s Options shall become exercisable in
full, and such Participant may exercise such Options until their expiration
date.

 

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If a Participant’s status as a Nonemployee Director ceases by reason of death,
or a Participant who was a Nonemployee Director dies after Retirement, all such
Participant’s then outstanding Options shall become exercisable in full, and the
executor or administrator of such Participant’s estate or a person or persons
who have acquired the Options directly from such Participant by bequest,
inheritance, or by reason of written designation as a beneficiary on a form
proscribed by the Corporation, shall have until the expiration dates of such
Options or thirteen (13) months after the Participant’s date of death, whichever
first occurs, to exercise such Options.

 

6.9 NONTRANSFERABILITY OF OPTIONS.

 

(a) INCENTIVE STOCK OPTIONS. No ISO granted under the Plan may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other
than (1) by will or by the laws of descent and distribution, or (2) if permitted
under Code Section 422, by transfer to a trust, the beneficial owner of which,
pursuant to Code Section 671 and applicable state law, is the Participant to
whom the ISO was granted (“Grantor Beneficial Trust”). Further, all ISOs granted
to a Participant under the Plan shall be exercisable during his or her lifetime
only by such Participant or the trustee of the Grantor Beneficial Trust if
permitted under Code Section 422.

 

(b) NONQUALIFIED STOCK OPTIONS. No NQSO granted under the Plan may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated by a
Participant, other than by will or by the laws of descent and distribution,
except that any NQSO (i) may be transferred by a Participant without
consideration to Permissible Transferees, but such transferees may not transfer
such NQSO’s to third parties except by will or the laws of descent and
distribution and then only to a Permissible Transferee, and (ii) shall be
subject to all other conditions and restrictions applicable to Options granted
under the Plan prior to such transfer. Any transfer to a Permissible Transferee
shall consist of Options covering a minimum of five thousand (5,000) Option
Shares.

 

ARTICLE 7. RESTRICTED STOCK

 

7.1 GRANT OF RESTRICTED STOCK. Subject to the terms and provisions of the Plan,
the Committee, at any time and from time to time, may grant Shares of Restricted
Stock to Participants in such amounts as the Committee shall determine.

 

7.2 RESTRICTED STOCK AGREEMENT. Each Restricted Stock grant shall be evidenced
by a Restricted Stock Award Agreement that shall specify the Period(s) of
Restriction, the number of Shares of Restricted Stock granted, and such other
provisions as the Committee shall determine.

 

7.3 OTHER RESTRICTIONS. The Committee shall impose such other conditions and/or
restrictions on any Shares of Restricted Stock granted pursuant to the Plan as
it may deem advisable including, without limitation, a requirement that
Participants pay a stipulated purchase price for each Share of Restricted Stock,
restrictions based upon the achievement of specific

 

12

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performance objectives (Corporation-wide, business unit, and/or individual),
Qualifying Performance Criteria, a Performance Cycle, time-based restrictions,
and/or restrictions under applicable Federal or state securities laws.

 

The Corporation shall retain the certificates representing Shares of Restricted
Stock in the Corporation’s possession until such time as all conditions and/or
restrictions applicable to such Shares have been satisfied.

 

Except as otherwise provided in this Article 7, Shares of Restricted Stock
covered by each Restricted Stock grant made under the Plan shall become freely
transferable by the Participant after the last day of the applicable Period of
Restriction.

 

7.4 VOTING RIGHTS. During the Period of Restriction, Participants holding Shares
of Restricted Stock granted hereunder may, at the discretion of the Committee,
exercise full voting rights with respect to those Shares.

 

7.5 DIVIDENDS AND OTHER DISTRIBUTIONS. During the Period of Restriction,
Participants holding Shares of Restricted Stock granted hereunder may, at the
discretion of the Committee, be credited with regular cash dividends paid with
respect to the underlying Shares while they are so held. Such dividends may be
paid currently, accrued as contingent cash obligations, or converted into
additional Shares of Restricted Stock, upon such terms as the Committee
establishes.

 

The Committee may apply any restrictions to the dividends that the Committee
deems appropriate. Without limiting the generality of the preceding sentence, if
the grant or vesting of Shares of Restricted Stock granted to a Covered Employee
is designed to comply with the requirements of the Performance-Based Exception,
the Committee may apply any restrictions it deems appropriate to the payment of
dividends declared with respect to such Shares of Restricted Stock, such that
the dividends and/or the Shares of Restricted Stock maintain eligibility for the
Performance-Based Exception. Shares of Restricted Stock shall be subject to
adjustment as provided in Article 4.3.

 

7.6. NONTRANSFERABILITY. During any Period(s) of Restriction, the Participant
shall have no right to transfer any rights with respect to its Award of Shares
of Restricted Stock.

 

ARTICLE 8. RESTRICTED STOCK UNITS

 

8.1 GRANT OF RSUs. Subject to the terms and provisions of the Plan, the
Committee, at any time and from time to time, may grant RSUs to Participants in
such amounts as the Committee shall determine.

 

8.2 AWARD AGREEMENT. Each RSU shall be evidenced by an Award Agreement that
shall specify the Period(s) of Restriction, the number of RSUs granted, and such
other provisions as the Committee shall determine.

 

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8.3 OTHER RESTRICTIONS. The Committee shall impose such other conditions and/or
restrictions on any RSUs granted pursuant to the Plan as it may deem advisable
including, without limitation, a requirement that Participants pay a stipulated
purchase price for each RSU, restrictions based upon the achievement of specific
performance objectives (Corporation-wide, business unit, and/or individual),
Qualifying Performance Criteria, a Performance Cycle, time-based restrictions,
and/or restrictions under applicable Federal or state securities laws.

 

8.4 VOTING RIGHTS. During the Period of Restriction, unless otherwise determined
by the Committee in its discretion, Participants holding RSUs may not exercise
any voting rights with respect to such RSUs.

 

8.5 DIVIDENDS AND OTHER DISTRIBUTIONS. During the Period of Restriction, unless
otherwise determined by the Committee in its discretion, Participants holding
RSUs shall not be entitled to any dividends or dividend equivalents with respect
to such RSUs.

 

8.6. NONTRANSFERABILITY. During any Period(s) of Restriction, the Participant
shall have no right to transfer any rights with respect to its Award of RSUs.

 

ARTICLE 9. STOCK APPRECIATION RIGHTS

 

9.1 GRANT OF SARs. Subject to the terms and provisions of the Plan, the
Committee, at any time and from time to time, may grant SARs to Participants in
such amounts as the Committee shall determine. A SAR shall represent a right to
receive a payment in cash, Shares, or a combination thereof, equal to the excess
of the Fair Market Value of a specified number of Shares on the date the SAR is
exercised over an amount (the “SAR exercise price”) which shall be no less than
the Fair Market Value on the date the SAR was granted (or the Option Price for
SARs granted in tandem with an Option), as set forth in the applicable Award
Agreement.

 

9.2 AWARD AGREEMENT. Each SAR grant shall be evidenced by an Award Agreement
that shall specify the SAR exercise price, the duration of the SAR, the number
of Shares to which the SAR pertains, whether the SAR is granted in tandem with
the grant of an Option or is freestanding, and such other provisions as the
Committee shall determine. SARs granted under this Article 9 shall be
exercisable at such times and be subject to such restrictions and conditions as
the Committee shall in each instance approve and which shall be set forth in the
applicable Award Agreement, which need not be the same for each grant or for
each Participant.

 

9.3 EXERCISE. SARs shall be exercised by the delivery to the Corporation of
written or other notice of exercise acceptable to the Corporation, setting forth
the number of Shares with respect to which the SAR is to be exercised. The date
of exercise of the SAR shall be the date on which the Corporation shall have
received notice from the Participant of the exercise of such SAR. SARs granted
in tandem with the grant of an Option may be exercised for all or part of the
Shares subject to the related Option upon the surrender of the right to exercise
the equivalent portion of the related Option. SARs granted in tandem with the
grant of an Option may be exercised only with respect to the shares for which
its related Option is then exercisable.

 

14

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With respect to SARs granted in tandem with an ISO, (a) such SAR will expire no
later than the expiration of the underlying ISO, (b) the value of the payout
with respect to such SAR may be for no more than 100% of the difference between
the Option Price of the underlying ISO and the Fair Market Value of the Shares
subject to the underlying ISO at the time such SAR is exercised, and (c) such
SAR may be exercised only when the Fair Market Value of the Shares subject to
the underlying ISO exceeds the Option Price of the ISO.

 

SARs granted independently from the grant of an Option may be exercised upon the
terms and conditions contained in the applicable Award Agreement. In the event
the SAR shall be payable in Shares, a certificate for the Shares acquired upon
exercise of an SAR shall be issued in the name of the Participant as soon as
practicable following receipt of notice of exercise. No fractional Shares will
be issuable upon exercise of the SAR and, unless provided in the applicable
Award Agreement or otherwise determined by the Committee, the Participant will
receive cash in lieu of fractional Shares.

 

9.4 EXERCISE UPON TERMINATION OF EMPLOYMENT. Each Participant’s Award Agreement
shall set forth the extent to which the Participant shall have the right to
exercise a SAR following termination of the Participant’s employment with the
Corporation. Such provisions shall be determined in the sole discretion of the
Committee, shall be included in the Award Agreement entered into the
Participants, need not be uniform among all SARs issued pursuant to this Article
9, and may reflect distinctions based on the reasons for termination of
employment.

 

9.5 NONTRANSFERABILITY. Unless otherwise determined by the Committee in its
discretion, no SAR granted under this Plan may be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated, other than by will or by the
laws of descent and distribution. Further, SARs granted in tandem with an ISO
granted to a Participant under the Plan shall be exercisable during the
Participant’s lifetime only by such Participant.

 

ARTICLE 10. DEFERRED STOCK AWARDS

 

10.1 GRANT OF DEFERRED STOCK. Subject to the terms and provisions of the Plan,
the Committee may authorize the grant or sale of Deferred Stock to Participants
in such amounts the Committee shall determine. Each such grant or sale shall
constitute the agreement by the Corporation to deliver Shares to the Participant
in the future in consideration of the performance of services, but subject to
the fulfillment of such conditions during the Deferral Period as the Committee
may specify. Each such grant or sale may be made without additional
consideration or in consideration of a payment by such Participant that is less
than the Fair Market Value of the Shares at the date of grant.

 

10.2 AWARD AGREEMENT. Each grant or sale of Deferred Stock shall be evidenced by
an Award Agreement, which shall contain such terms and provisions, consistent
with this Plan, as the Committee may approve.

 

15

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10.3 DEFERRAL PERIOD. Each such grant or sale shall be subject, except (if the
Committee shall so determine) in the event of a Change in Control or other
similar transaction or event, to a Deferral Period of not less than one (1)
year, as determined by the Committee at the date of grant.

 

10.4 VOTING RIGHTS. During the Deferral Period, unless otherwise determined by
the Committee in its discretion, the Participant shall have no rights of
ownership in the Shares of Deferred Stock and shall have no right to vote them.

 

10.5 DIVIDENDS. During the Deferral Period, the Committee may, at or after the
date of grant, authorize payment of dividend equivalents on any Shares of
Deferred Stock on either a current, deferred, or contingent basis, either in
cash or in additional Shares.

 

10.6 NONTRANSFERABILITY. During the Deferral Period, the Participant shall have
no right to transfer any rights with respect to its Award of Shares of Deferred
Stock.

 

ARTICLE 11. LONG-TERM PERFORMANCE AWARDS

 

11.1 LONG-TERM PERFORMANCE AWARDS. Subject to the terms and provisions of the
Plan, a Participant shall have the opportunity to receive an Award of cash,
Shares, or a combination thereof, in such amounts and upon such terms and at
such times as determined by the Committee in its sole discretion.

 

11.2 TERMS OF LONG-TERM PERFORMANCE AWARDS. The Committee shall set performance
objectives in its discretion which, depending on the extent to which they are
met, will determine the number of Shares and/or value of Long-Term Performance
Awards that will be paid to the Participant. The Committee shall establish the
Performance Cycle for each Long-Term Performance Award and shall impose such
other conditions and/or restrictions on any Long-Term Performance Awards as it
may deem advisable including, without limitation, restrictions based upon the
achievement of specific performance objectives (Corporation-wide, business unit,
and/or individual), Qualifying Performance Criteria, time-based restrictions,
and/or restrictions under applicable Federal or state securities laws.

 

11.3 EARNING OF LONG-TERM PERFORMANCE AWARDS. Subject to the terms of this Plan
and Article 11, after the applicable Performance Cycle has ended, the
Participant shall be entitled to receive a payment of the number of Shares
and/or cash earned by the Participant over the applicable Performance Cycle.
Notwithstanding the attainment of specific performance objectives, the Committee
has the discretion to reduce or eliminate an Award that would otherwise be
payable based on its evaluation of Extraordinary Events and other factors.

 

11.4 FORM AND TIMING OF PAYMENT OF LONG-TERM PERFORMANCE AWARDS. Payment of
Long-Term Performance Awards shall be made as soon as practical following the
close of the applicable Performance Cycle in a manner designated by the
Committee, in its sole discretion. Subject to the terms of this Plan, the
Committee, in its sole discretion, may pay Long-Term Performance Awards in the
form of cash or in Shares (or in a

 

16

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combination thereof) which have an aggregate Fair Market Value equal to the
value of the Long-Term Performance Awards at the close of the applicable
Performance Cycle. Such Shares may be granted subject to any restrictions deemed
appropriate by the Committee.

 

11.5 REQUIREMENT OF EMPLOYMENT. Except as otherwise provided in this Plan and as
specified in Article 16, a Participant must remain in the employment of the
Corporation until the payment of a Long-Term Performance Award in order to be
entitled to payment; provided, however, that the Committee may, in its sole
discretion, provide for a partial or full payment in the event the Participant
is not so employed.

 

11.6 NONTRANSFERABILITY. A Long-Term Performance Award may not be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other
than by will or by the laws of descent and distribution.

 

ARTICLE 12. CODE SECTION 162(m) DEDUCTION QUALIFICATIONS

 

12.1 AWARDS FOR COVERED EMPLOYEES. At all times when Code Section 162(m) is
applicable, all Awards granted to a Covered Employee under this Plan shall
comply with the Performance-Based Exception requirements of Code Section 162(m).
In addition, in the event that changes are made to Code Section 162(m) to permit
greater flexibility with respect to any Award available under the Plan, the
Committee may, subject to this Article 12, make any adjustments it deems
appropriate. Notwithstanding the above, the Committee may, in its sole
discretion, with respect to any Award under the Plan, determine that compliance
with Code Section 162(m) is not desired after consideration of the goals of the
Corporation’s executive compensation philosophy and whether it is in the best
interests of the Corporation to have such Award so qualified.

 

12.2 DESIGNATION OF COVERED EMPLOYEES. For each Performance Cycle, the Committee
will designate which Participants are Covered Employees within ninety (90) days
of the beginning of the Performance Cycle (or such earlier or later date as is
permitted or required by Code Section 162(m)).

 

12.3 ESTABLISHMENT OF QUALIFYING PERFORMANCE CRITERIA AND AWARDS FOR COVERED
EMPLOYEES. Within ninety (90) days of the beginning of a Performance Cycle (or
such earlier or later date as is permitted or required by Code Section 162(m)),
the Committee shall, in its sole discretion, for each such Performance Cycle,
determine and establish in writing one or more performance goals based on one or
more Qualifying Performance Criteria applicable to the Performance Cycle for
each Covered Employee. The Committee may establish any number of differing
Performance Cycles, performance goals, Qualifying Performance Criteria, and
Awards for Covered Employees running concurrently, in whole or in part.

 

12.4 CERTIFICATION OF ACHIEVEMENT OF QUALIFYING PERFORMANCE CRITERIA AND AMOUNT
OF AWARDS. After the end of each Performance Cycle, or such earlier date if the
Qualifying Performance Criteria are achieved (and such date otherwise

 

17

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complies with Code Section 162(m)), the Committee shall certify in writing,
prior to the payment of any Award to a Covered Employee, that the performance
goal based on the Qualifying Performance Criteria for the Performance Cycle and
all other material terms of the Plan were satisfied. The Committee may not,
under any circumstances, increase an Award to a Covered Employee above the
amount payable pursuant to the pre-established performance goal based on the
Qualifying Performance Criteria for the Performance Cycle.

 

12.5 MAXIMUM AWARD TO PARTICIPANTS. Notwithstanding any other provision of this
Plan to the contrary, the maximum aggregate number of Shares which may be
subject to option by one or more Option Awards or SAR Awards (whether settled in
cash, Shares, or a combination thereof) to a Participant shall be four million
(4,000,000) Shares over any five (5) year period. Notwithstanding any of
provision of this Plan to the contrary, the maximum amount of compensation
(whether represented by Shares, cash, or a combination thereof) that may be
payable to a Participant with respect to any specified Performance Cycle,
pursuant to the attainment of a performance goal associated with a Long-Term
Performance Award, Restricted Stock Award, RSU Award, or Deferred Stock Award
shall be four million dollars ($4,000,000) for each type of Award.

 

12.6 TAX AND SECURITY LAWS. In the event that applicable tax and/or securities
laws change to permit the Committee discretion to alter the governing
performance measures without obtaining shareholder approval of such changes, the
Committee shall have the sole discretion to make such changes without obtaining
shareholder approval.

 

ARTICLE 13. BENEFICIARY DESIGNATION

 

Each Participant under the Plan may, from time to time, name any beneficiary or
beneficiaries (who may be named contingently or successively) to whom any
benefit under the Plan is to be paid in case of his or her death before he or
she receives any or all of such benefit. Each such designation shall revoke all
prior designations by the same Participant, shall be in a form prescribed by the
Corporation, and will be effective only when filed by the Participant in writing
with the Corporation during the Participant’s lifetime. In the absence of any
such designation, benefits remaining unpaid at the Participant’s death shall be
paid to the Participant’s estate.

 

ARTICLE 14. DEFERRALS

 

The Committee may permit or require a Participant to defer such Participant’s
receipt of the payment of cash or the delivery of Shares that would otherwise be
due to such Participant by virtue of the (1) exercise of an Option, (2) the
lapse or waiver of restrictions with respect to Restricted Stock, RSUs, SARs,
Deferred Stock, or (3) the satisfaction of any requirements or objectives with
respect to Long-Term Performance Awards. If any such deferral election is
required or permitted, the Committee shall, in its sole discretion, establish
rules and procedures for such payment of deferrals including the crediting of
interest or dividend equivalents.

 

18

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ARTICLE 15. DISCRETION TO REDUCE AWARDS

 

Notwithstanding any provision to the contrary, except in the event of a Change
in Control, the Committee has the discretion to reduce or eliminate an Award
that would otherwise be paid to any Participant, including any Covered Employee,
based on the Committee’s evaluation of Extraordinary Events or other factors.

 

ARTICLE 16. RIGHTS OF EMPLOYEES

 

16.1 EMPLOYMENT. Nothing in the Plan shall interfere with or limit in any way
the right of the Corporation to terminate any Participant’s employment at any
time, with or without Cause, nor confer upon any Participant any right to
continue in the employ of the Corporation.

 

16.2 PARTICIPATION. No Employee shall have the right to be selected to receive
an Award under this Plan, or, having been so selected, to be selected to receive
a future Award.

 

ARTICLE 17. CHANGE IN CONTROL

 

17.1 TREATMENT OF AWARDS. Notwithstanding any provision in this Plan to the
contrary, upon the occurrence of a Change in Control, unless otherwise
specifically prohibited under applicable laws, or by the rules and regulations
of any governing governmental agencies or national securities exchanges:

 

(a) Any and all Options or SARs granted hereunder shall become immediately
exercisable in full, and all such Options or SARs shall remain exercisable
throughout their entire term notwithstanding the death, Retirement or
termination of employment or directorship of the Participant;

 

(b) Any nonperformance-based restriction periods or restrictions imposed on
Shares of Restricted Stock, RSUs, or Shares of Deferred Stock shall lapse; and

 

(c) All Long-Term Performance Awards and performance-based Awards of Shares of
Restricted Stock, RSUs, and Shares of Deferred Stock shall be measured as of the
effective date of the Change in Control, and shall be paid out to Participants
within thirty (30) days following the effective date of the Change in Control,
in a pro rata amount based upon (i) the actual results measured as of the
effective date of the Change in Control, and (ii) the length of time within the
Performance Cycle which has elapsed prior to the Change in Control.

 

17.2 TERMINATION, AMENDMENT, AND MODIFICATIONS OF CHANGE-IN-CONTROL PROVISIONS.
Notwithstanding any other provision of this Plan or any Award Agreement
provision, the provisions of this Article 17 may not be terminated, amended, or
modified on or after the date of a Change in Control to affect adversely any
Award theretofore granted under the Plan without the prior written consent of
the Participant with respect to said Participant’s outstanding Awards.

 

19

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ARTICLE 18. AMENDMENT, MODIFICATION, AND TERMINATION

 

Subject to Article 17.2 herein, the Board or Committee may at any time and from
time to time, alter, amend, suspend, or terminate the Plan in whole or in part;
provided, however, that the Committee shall not have the authority to, without
shareholder approval, (1) change the limits set forth in Article 4.1, (2) change
the minimum Option Price, (3) change eligible Participants to receive Awards, or
(4) reprice or alter the Option Price of any Option.

 

ARTICLE 19. WITHHOLDING

 

19.1 TAX WITHHOLDING. The Corporation shall have the power and the right to
deduct or withhold, or require a Participant to remit to the Corporation, an
amount sufficient to satisfy Federal, state, and local taxes, domestic or
foreign, required by law or regulation to be withheld with respect to any
taxable event arising as a result of this Plan.

 

19.2 SHARE WITHHOLDING. With respect to withholding required upon the exercise
of Options, upon the lapse of restrictions on Restricted Stock, RSUs, SARS, or
Deferred Stock, or upon any other taxable event arising as a result of Awards
granted hereunder, Participants may elect to satisfy the tax withholding
requirement, in whole or in part, by (i) having the Corporation withhold Shares
having a Fair Market Value on the date the tax is to be determined equal to the
minimum statutory tax withholding rates which could be withheld on the
transaction or (ii) the delivery of Shares that have been held for a minimum of
six (6) months to the Corporation (including attestation) having a Fair Market
Value equal to the amount of the tax withholding obligations related to the
transaction. All such elections shall be irrevocable and shall be subject to any
restrictions or limitations that the Committee, in its sole discretion, deems
appropriate. Delivery or withholding of fractional Shares shall not be
permitted.

 

ARTICLE 20. FORFEITURE

 

Except on or after a Change in Control or as otherwise provided in the
applicable Award Agreement, and notwithstanding any other provisions in the
Plan, in the event of (1) a serious breach of conduct by a Participant or former
Participant (including, without limitation, any conduct prejudicial to or in
conflict with the Corporation or any securities laws violations including any
violations under the Sarbanes-Oxley Act of 2002) or (2) any activity of a
Participant or former Participant in which the Participant or former Participant
solicits or takes away customers or potential customers with whom the
Participant or former Participant had contact with or responsibility for during
the Participant’s or former Participant’s employment with the Corporation
(individually and collectively referred to as “Misconduct”), the Committee may
(a) terminate any outstanding Award granted to the Participant, in whole or in
part, whether or not vested, and/or (b) if such Misconduct occurs within three
(3) years of the exercise or payment of an Award, require the Participant or
former Participant to repay the Corporation any gain realized or payment
received upon the exercise or payment of such Award (with such gain

 

20

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or repayment valued as of the date of exercise or payment), without regard to
when such Misconduct is actually discovered by the Corporation. Such termination
or repayment obligation shall be effective as of the date specified by the
Committee. Any repayment obligation may be satisfied in Shares or cash or a
combination thereof (based upon the Fair Market Value of the Shares on the day
prior to the repayment) and the Committee may provide for an offset of any
future payments owed by the Corporation to such person if necessary to satisfy
the repayment obligation. The determination of whether any Participant or former
Participant has engaged in a serious breach of conduct or any prohibited
solicitation shall be determined by the Committee in good faith and in its sole
discretion.

 

ARTICLE 21. INDEMNIFICATION

 

Each person who is or shall have been a member of the Committee, or of the
Board, shall be indemnified and held harmless by the Corporation against and
from any loss, cost, liability, or expense that may be imposed upon or
reasonably incurred by him or her 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 taken or failure to act under
the Plan and against and from any and all amounts paid by him or her in
settlement thereof, with the Corporation’s approval, or paid by him or her in
satisfaction of any judgement in any such action, suit, or proceeding against
him or her, provided he or she shall give the Corporation 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 under the Corporation’s Charter or Bylaws, as a matter
of law, or otherwise, or any power that the Corporation may have to indemnify
them or hold them harmless.

 

ARTICLE 22. SUCCESSORS

 

All obligations of the Corporation under the Plan with respect to Awards granted
hereunder shall be binding on any successor to the Corporation, whether the
existence of such successor is the result of a direct or indirect purchase of
all or substantially all of the business and/or assets of the Corporation, or a
merger, consolidation, or otherwise.

 

ARTICLE 23. UNFUNDED PLAN

 

The Plan shall be unfunded and the Corporation shall not be required to
segregate any assets that may at any time be represented by Awards under the
Plan. Any liability of the Company to any person with respect to any Awards
under the Plan shall be based solely upon any contractual obligations that may
be effected pursuant to the Plan. Except as provided herein, no such obligation
of the Corporation shall be deemed to be secured by any pledge of, or other
encumbrance on, any property of the Corporation.

 

21

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ARTICLE 24. NOTIFICATION UNDER CODE SECTION 83(b)

 

If the Participant, in connection with the exercise of any Option, or the grant
of Shares from an Award of SARs, Restricted Stock, or RSUs, desires to make the
election permitted under Code Section 83(b) to include in such Participant’s
gross income in the year of transfer the amounts specified in Code Section
83(b), then such Participant shall notify the Corporation of the desired
election within ten (10) days before the filing of the notice of the election
with the Internal Revenue Service in addition to any filing and notification
required under regulations issued under Code Section 83(b). The Committee may,
in connection with the grant of an Award or at any time thereafter before such
an election being made, prohibit a Participant from making the election
described above.

 

ARTICLE 25. OTHER PLANS

 

Nothing in this Plan shall be construed as limiting the authority of the
Committee, the Board of Directors, the Corporation or any Subsidiary to
establish any other compensation plan, or as in any way limiting its or their
authority to pay bonuses or supplemental compensation to any persons employed by
the Company or a Subsidiary, whether or not such person is a Participant in this
Plan and regardless of how the amount of such compensation or bonus is
determined. However, no such plan will be established or operated in a way that
entitles or allows a Covered Employee to receive an award under such plan as a
substitution or supplement for not achieving goals under this Plan.

 

ARTICLE 26. LEGAL CONSTRUCTION

 

25.1 GENDER AND NUMBER. Except where otherwise indicated by the context, any
masculine term used herein also shall include the feminine; the plural shall
include the singular and the singular shall include the plural.

 

25.2 SEVERABILITY. In the event any provision of the Plan shall be held illegal
or invalid for any reason, the illegality or invalidity shall not affect the
remaining parts of the Plan, and the Plan shall be construed and enforced as if
the illegal or invalid provision had not been included.

 

25.3 REQUIREMENTS OF LAW. The granting of Awards and the issuance of Shares
under the Plan shall be subject to all applicable laws, rules, and regulations,
and to such approvals by any governmental agencies or national securities
exchanges as may be required.

 

25.4 GOVERNING LAW. To the extent not preempted by Federal law, the Plan, and
all agreements hereunder, shall be construed in accordance with and governed by
the laws of the state of Ohio, without reference to its choice of law rules.

 

22