Exhibit 10.5

Amended and Restated Global Stock and Incentive Compensation Plan

Hewitt Associates, Inc.

Effective June 17, 2002

Amended October 31, 2006

Amended and Restated November 7, 2007

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Contents

 

Article 1.    Establishment, Purpose, and Duration    Article 2.    Definitions
   Article 3.    Administration    Article 4.    Shares Subject to the Plan and
Maximum Awards    Article 5.    Eligibility and Participation    Article 6.   
Stock Options    Article 7.    Stock Appreciation Rights    Article 8.   
Restricted Stock and Restricted Stock Units    Article 9.    Performance
Units/Performance Shares    Article 10.    Cash-Based Awards    Article 11.   
Performance Measures    Article 12.    Annual Management Incentive Awards   
Article 13.    Beneficiary Designation    Article 14.    Deferrals    Article
15.    Rights of Employees/Directors    Article 16.    Change in Control   
Article 17.    Amendment, Modification, Suspension, and Termination    Article
18.    Withholding    Article 19.    Indemnification    Article 20.   
Successors    Article 21.    General Provisions   

 

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Hewitt Associates, Inc. Amended and Restated Global Stock and Incentive
Compensation Plan

Article 1. Establishment, Purpose, and Duration

1.1 Establishment. Hewitt Associates, Inc., a Delaware corporation (hereinafter
referred to as the “Company”), establishes an amended and restated incentive
compensation plan to be known as the Amended and Restated Global Stock and
Incentive Compensation Plan (hereinafter referred to as the “Plan”), as set
forth in this document.

The Plan permits the grant of Annual Management Incentive Awards, Nonqualified
Stock Options, Incentive Stock Options, Stock Appreciation Rights (“SARs”),
Restricted Stock, Restricted Stock Units, Performance Shares, Performance Units,
and Cash-Based Awards.

The Plan became effective as of June 17, 2002 (the “Effective Date”), was
amended as of October 31, 2006 and, subject to stockholder approval, amended and
restated as of November 7, 2008, and shall remain in effect as provided in
Section 1.3 hereof.

1.2 Purpose of the Plan. The purpose of the Plan is to promote the long-term
interests of the Company and its stockholders by strengthening the Company’s
ability to attract, motivate, and retain Employees and Directors of the Company
upon whose judgment, initiative, and efforts the financial success and growth of
the business of the Company largely depend, and to provide an additional
incentive for such individuals through stock ownership and other rights that
promote and recognize the financial success and growth of the Company and create
value for stockholders.

1.3 Duration of the Plan. The Plan commenced as of the Effective Date, as
described in Section 1.1 hereof, and shall remain in effect, subject to the
right of the Board of Directors to amend or terminate the Plan at any time
pursuant to Article 17 hereof, until all Shares subject to it shall have been
purchased or acquired according to the Plan’s provisions.

Article 2. Definitions

Whenever used in the Plan, the following terms shall have the meanings set forth
below, and when the meaning is intended, the initial letter of the word shall be
capitalized.

 

  2.1 “Affiliate” shall have the meaning ascribed to such term in Rule 12b-2 of
the General Rules and Regulations of the Exchange Act.

 

  2.2 “Annual Management Incentive Award” means an Award granted to a
Participant as described in Article 12 herein.

 

  2.3 “Award” means, individually or collectively, a grant under this Plan of
Annual Management Incentive Awards, Nonqualified Stock Options, Incentive Stock
Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units,
Performance Shares, Performance Units, or Cash-Based Awards.

 

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  2.4 “Award Agreement” means either (i) an agreement entered into by the
Company and each Participant setting forth the terms and provisions applicable
to Awards granted under this Plan, or (ii) a statement issued by the Company to
a Participant describing the terms and provisions of such Award.

 

  2.5 “Beneficial Owner” or “Beneficial Ownership” shall have the meaning
ascribed to such term in Rule 13d-3 of the General Rules and Regulations under
the Exchange Act.

 

  2.6 “Board” or “Board of Directors” means the Board of Directors of
the Company.

 

  2.7 “Cash-Based Award” means an Award granted to a Participant as described in
Article 10 herein.

 

  2.8 “Change in Control” shall occur if any of the following events occur:

 

  (a) The acquisition by any individual, entity, or group of Beneficial
Ownership of thirty percent (30%) or more of the combined voting power of the
Company’s then outstanding securities with respect to the election of Directors
of the Company;

 

  (b) The consummation of a reorganization, merger, or consolidation of the
Company or sale or other disposition of all or substantially all of the assets
of the Company (a “Corporate Transaction”); excluding, however, a Corporate
Transaction pursuant to which all or substantially all of the individuals or
entities who are the Beneficial Owners of the Company immediately prior to the
Corporate Transaction will beneficially own, directly or indirectly, more than
sixty percent (60%) of the outstanding shares of common stock of the resulting
entity and of the combined voting power of the outstanding securities entitled
to vote for the election of directors of such entity; or

 

  (c) Individuals who, as of the Effective Date, constitute the Board (the
“Incumbent Board”) cease for any reason to constitute at least a majority of
such Board; provided, that any individual who becomes a Director of the Company
subsequent to the Effective Date, whose election, or nomination for election by
the Company’s stockholders, was approved by the vote of at least a majority of
the Directors then comprising the Incumbent Board shall be deemed a member of
the Incumbent Board; and provided further, that any individual who was initially
elected as a Director of the Company as a result of an actual or threatened
election contest, as such terms are used in Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act, or any other actual or threatened
solicitation of proxies or consents by or on behalf of any Person other than the
Board shall not be deemed a member of the Incumbent Board.

 

  2.9 “Code” means the U.S. Internal Revenue Code of 1986, as amended from time
to time.

 

  2.10 “Committee” means any Committee appointed by the Board to administer
Awards to Participants, as specified in Article 3 herein.

 

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  2.11 “Company” means Hewitt Associates, Inc., a Delaware corporation, and any
successor thereto as provided in Article 20 herein.

 

  2.12 “Covered Employee” means a Participant who is a “covered employee,” as
defined in Code Section 162(m) and the regulations promulgated under Code
Section 162(m), or any successor statute.

 

  2.13 “Director” means any individual who is a member of the Board of Directors
of the Company; provided, however, that such Director is not an Employee of the
Company.

 

  2.14 “Employee” means any Employee of the Company, its Affiliates and/or
Subsidiaries.

 

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

 

  2.16 “Fair Market Value” means a price to be determined by the Committee, that
is at or within the range of the high and low selling prices of a Share on the
New York Stock Exchange on the date in question or, if no sales of Shares were
made on said exchange on such date, on the next preceding day on which sales
were made on such exchange; provided, that for purposes of determining the
Option Price with respect to a grant on the date of the Company’s initial public
offering of Shares, “Fair Market Value” shall mean the initial public offering
price per Share negotiated between the Company and its underwriter(s).

 

  2.17 “Fiscal Year” means the year commencing on October 1 and ending
September 30, or other time period as approved by the Board.

 

  2.18 “Freestanding SAR” means an SAR that is granted independently of any
Options, as described in Article 7 herein.

 

  2.19 “Incentive Stock Option” or “ISO” means an Option to purchase Shares
granted under Article 6 herein and that is designated as an Incentive Stock
Option and that is intended to meet the requirements of Code Section 422, or any
successor provision.

 

  2.20 “Insider” shall mean an individual who is, on the relevant date, an
officer, Director, or more than ten percent (10%) Beneficial Owner of any class
of the Company’s equity securities that is registered pursuant to Section 12 of
the Exchange Act, as determined by the Board in accordance with Section 16 of
the Exchange Act.

 

  2.21 “Nonqualified Stock Option” or “NQSO” means an Option that is not
intended to meet the requirements of Code Section 422, or that otherwise does
not meet such requirements.

 

  2.22 “Option” means an Incentive Stock Option or a Nonqualified Stock Option,
as described in Article 6 herein.

 

  2.23 “Option Price” means the price at which a Share may be purchased by a
Participant pursuant to an Option.

 

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  2.24 “Participant” means an Employee or Director who has been selected to
receive an Award or who has an outstanding Award granted under the Plan.

 

  2.25 “Performance-Based Compensation” means the Award is qualified as
Performance-Based Compensation under Code Section 162(m).

 

  2.26 “Performance Measures” means measures as described in Article 11, the
attainment of which may determine the degree of payout and/or vesting with
respect to Awards to Covered Employees that are designated to qualify as
Performance-Based Compensation.

 

  2.27 “Performance Period” means the period of time during which the
performance goals must be met in order to determine the degree of payout and/or
vesting with respect to an Award.

 

  2.28 “Performance Share” means an Award granted to a Participant, as described
in Article 9.

 

  2.29 “Performance Unit” means an Award granted to a Participant, as described
in Article 9.

 

  2.30 “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 defined in Section 13(d) thereof.

 

  2.32 “Restricted Stock” means an Award granted to a Participant pursuant to
Article 8 herein.

 

  2.33 “Restricted Stock Unit” means an Award granted to a Participant pursuant
to Article 8 herein.

 

  2.34 “Shares” means the Class A common stock of the Company, $.01 par value
per share.

 

  2.35 “Stock Appreciation Right” or “SAR” means an Award, designated as an SAR,
pursuant to the terms of Article 7 herein.

 

  2.36 “Subsidiary” means any corporation, partnership, joint venture, limited
liability company, or other entity (other than the Company) in an unbroken chain
of entities beginning with the Company if, at the time of the granting of an
Award, each of the entities other than the last entity in the unbroken chain
owns at least twenty percent (20%) of the total combined voting power in one of
the other entities in such chain.

 

  2.37 “Vesting Period” means the period when Awards are subject to forfeiture
based on the passage of time, the achievement of performance goals, or upon the
occurrence of other events as determined by the Board, at its discretion.

Article 3. Administration

3.1 General. The Board shall be responsible for administering the Plan. The
Board may employ attorneys, consultants, accountants, and other persons, and the
Board, the Company, and its officers and Directors shall be entitled to rely
upon the advice, opinions, or valuations of any such persons. All actions taken
and all interpretations and determinations made by the Board in good faith shall
be final and binding upon the Participants, the Company, and all other
interested persons.

 

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3.2 Authority of the Board. The Board shall have full and exclusive
discretionary power to interpret the Plan and to determine eligibility for
Awards and to adopt such rules, regulations, and guidelines for administering
the Plan as the Board may deem necessary or proper. Such authority shall
include, but not be limited to, selecting Award recipients, establishing all
Award terms and conditions and, subject to Article 17, adopting modifications
and amendments to the Plan or any Award Agreement, including without limitation,
any that are necessary to comply with the laws of the countries in which the
Company, its Affiliates, and/or its Subsidiaries operate.

3.3 Delegation. The Board may delegate to a Committee any or all of the
administration of the Plan. The members of the Committee shall be appointed from
time to time by, and shall serve at the discretion of, the Board. To the extent
that the Board has delegated to the Committee any authority and responsibility
under the Plan, all applicable references to the Board in the Plan shall be to
the Committee. The Board may delegate to one or more of its members or to one or
more agents or advisors such nondiscretionary administrative duties as it may
deem advisable, and the Board or any person to whom it has delegated duties as
aforesaid may employ one or more persons to render advice with respect to any
responsibility the Board or such person may have under the Plan. The Board may,
by resolution, authorize one or more officers of the Company to do one or both
of the following: (a) designate officers and Employees of the Company, its
Affiliates, and/or its Subsidiaries to be recipients of Awards; and
(b) determine the size of the Award; provided, however, that the resolution
providing such authorization sets forth the total number of Awards such officer
or officers may grant.

Article 4. Shares Subject to the Plan and Maximum Awards

4.1 Number of Shares Available for Awards. Subject to adjustment as provided in
Section 4.2 herein, the number of Shares hereby reserved for issuance to
Participants under the Plan shall be thirty-two million (32,000,000). All of the
reserved Shares may be used as ISOs. Any Shares of common stock related to
Awards which terminate by expiration, forfeiture, cancellation, or otherwise
without the issuance of such Shares, are settled in cash in lieu of common
stock, or are exchanged with the Board’s permission for Awards not involving
common stock, shall be available again for grant under the Plan. Moreover, if
the Option Price of any Option granted under the Plan or the tax withholding
requirements with respect to any Award granted under the Plan are satisfied by
tendering Shares of common stock to the Company (by either actual delivery or by
attestation), only the number of Shares of common stock issued net of the Shares
of common stock tendered will be deemed delivered for purposes of determining
the maximum number of Shares of common stock available for delivery under the
Plan. The maximum number of Shares available for issuance under the Plan shall
not be reduced to reflect any dividends or dividend equivalents that are
reinvested into additional Shares of common stock or credited as additional
Restricted Stock, Restricted Stock Units, or Performance Shares. In addition,
the Board, in its discretion, may establish any other appropriate methodology
for calculating the number of Shares issued pursuant to the Plan. The Shares of
common stock available for issuance under the Plan may be authorized and
unissued Shares or treasury Shares.

 

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Unless and until the Board determines that an Award to a Covered Employee shall
not be designed to qualify as Performance-Based Compensation, the following
limits (“Award Limits”) shall apply to grants of such Awards under the Plan:

 

  (a) Options: The maximum aggregate number of Shares that may be granted in the
form of Options, pursuant to any Award granted in any one Fiscal Year to any one
Participant shall be one million (1,000,000).

 

  (b) SARs: The maximum number of Shares that may be granted in the form of
Stock Appreciation Rights, pursuant to any Award granted in any one Fiscal Year
to any one Participant shall be five hundred thousand (500,000).

 

  (c) Restricted Stock/Restricted Stock Units: The maximum aggregate grant with
respect to Awards of Restricted Stock/Restricted Stock Units granted in any one
Fiscal Year to any one Participant shall be five hundred thousand (500,000).

 

  (d) Performance Units/Performance Shares: The maximum aggregate Award of
Performance Units or Performance Shares that a Participant may receive in any
one Fiscal Year shall be five hundred thousand (500,000) Shares, or equal to the
value of five hundred thousand (500,000) Shares determined as of the date of
vesting or payout, as applicable.

 

  (e) Cash-Based Awards: The maximum aggregate amount awarded or credited with
respect to Cash-Based Awards to any one Participant in any one Fiscal Year may
not exceed three million dollars ($3,000,000) determined as of the date of
vesting or payout, as applicable.

 

  (f) Annual Management Incentive Award. The maximum aggregate amount awarded or
credited in any one Fiscal Year with respect to an Annual Management Incentive
Award to a Participant who is a Covered Employee shall be determined in
accordance with Article 12. The maximum aggregate amount awarded or credited in
any one Fiscal Year with respect to an Annual Management Incentive Award to a
Participant who is not a Covered Employee shall be determined by the Board in
its discretion.

4.2 Adjustments in Authorized Shares. In the event of any corporate event or
transaction (including, but not limited to, a change in the Shares of the
Company or the capitalization of the Company) such as a merger, consolidation,
reorganization, recapitalization, separation, stock dividend, stock split,
reverse stock split, split up, spin-off, or other distribution of stock or
property of the Company, combination of shares, exchange of shares, dividend in
kind, or other like change in capital structure or distribution (other than
normal cash dividends) to stockholders of the Company, or any similar corporate
event or transaction, the Board, in order to prevent dilution or enlargement of
Participants’ rights under the Plan, shall substitute or adjust, in an equitable
manner, as applicable, the number and kind of Shares that may be issued under
the Plan, the number and kind of Shares subject to outstanding Awards, the
Option Price applicable to outstanding Awards, the Award Limits, and other value
determinations applicable to outstanding Awards.

 

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Appropriate adjustments may also be made by the Board in the terms of any Awards
under the Plan to reflect such changes or distributions and to modify any other
terms of outstanding Awards on an equitable basis, including modifications of
performance goals and changes in the length of Performance Periods. The
determination of the Board as to the foregoing adjustments, if any, shall be
conclusive and binding on Participants under the Plan.

Subject to the provisions of Article 16, without affecting the number of Shares
reserved or available hereunder the Board may authorize the issuance or
assumption of benefits under this Plan in connection with any merger,
consolidation, acquisition of property or stock, or reorganization upon such
terms and conditions as it may deem appropriate.

It is intended that any adjustment made by the Committee under this Section 4.2
will not result in the additional tax imposed under Code Section 409A.

Article 5. Eligibility and Participation

5.1 Eligibility. Persons eligible to participate in this Plan include all
Employees and Directors.

5.2 Actual Participation. Subject to the provisions of the Plan, the Board may,
from time to time, select from all eligible Employees and 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 Board, provided that
ISOs shall not be granted to Directors. In addition, ISOs may not be granted
following the ten-year anniversary of shareholder approval of the Plan, as
amended, on January 30, 2008.

It is intended that Options will not be granted if doing so would result in the
additional tax imposed under Code Section 409A.

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 conditions upon which an Option shall
become vested and exercisable, and such other provisions as the Board shall
determine which are not inconsistent with the terms of the Plan. 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 as determined by the Board; provided, however, the Option Price shall
not be less than one hundred percent (100%) of the Fair Market Value of the
Shares on the date the Option is granted. Notwithstanding the foregoing, for
Options granted to Participants outside the United States who are non-U.S.
taxpayers, the Board has the authority to grant Options at a price that is less
than the Fair Market Value of the Shares on the date of grant.

 

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6.4 Duration of Options. Each Option granted to a Participant shall expire at
such time as the Board shall determine at the time of grant; provided, however,
no Option shall be exercisable later than the tenth (10th) anniversary date of
its grant. Notwithstanding the foregoing, for Options granted to Participants
outside the United States, the Board has the authority to grant Options that
have a term greater than ten years.

6.5 Exercise of Options. Options granted under this Article 6 shall be
exercisable at such times and be subject to such restrictions and conditions as
the Board shall in each instance approve, which need not be the same for each
grant or for each Participant.

6.6 Payment. Options granted under this Article 6 shall be exercised by the
delivery of a written notice of exercise to the Company, setting forth the
number of Shares with respect to which the Option is to be exercised,
accompanied by full payment for the Shares.

The Option Price upon exercise of any Option shall be payable to the Company in
full either: (a) in cash or its equivalent, (b) by tendering (either by actual
delivery or attestation) previously acquired Shares having an aggregate Fair
Market Value at the time of exercise equal to the total Option Price (provided
that the Shares that are tendered must have been held by the Participant for at
least six (6) months prior to their tender to satisfy the Option Price or have
been purchased on the open market), (c) by a combination of (a) and (b), or
(d) any other method approved by the Board in its sole discretion at the time of
grant and as set forth in the Award Agreement.

The Board also may allow cashless exercise as permitted under the Federal
Reserve Board’s Regulation T, subject to applicable securities law restrictions,
or by any other means which the Board determines to be consistent with the
Plan’s purpose and applicable law.

Subject to any governing rules or regulations, as soon as practicable after
receipt of a written notification of exercise and full payment, the Company
shall deliver to the Participant, Share certificates or evidence of book entry
Shares, in an appropriate amount based upon the number of Shares purchased under
the Option(s).

Unless otherwise determined by the Board, all payments under all of the methods
indicated above shall be paid in United States dollars.

6.7 Restrictions on Share Transferability. The Board 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 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.

6.8 Termination of Employment/Directorship. Each Participant’s Award Agreement
shall set forth the extent to which the Participant shall have the right to
exercise the Option following termination of the Participant’s employment or
directorship with the Company, its Affiliates, and/or its Subsidiaries, as the
case may be. Such provisions shall be determined in the sole discretion of the
Board, shall be included in the Award Agreement entered into with each
Participant, need not be uniform among all Options issued pursuant to this
Article 6, and may reflect distinctions based on the reasons for termination.

 

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6.9 Transferability 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 by will or by the laws of descent and distribution. Further, all ISOs
granted to a Participant under this Article 6 shall be exercisable during his or
her lifetime only by such Participant.

 

  (b) Nonqualified Stock Options. Except as otherwise provided in a
Participant’s Award Agreement, no NQSO granted under this Article 6 may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other
than by will or by the laws of descent and distribution. Further, except as
otherwise provided in a Participant’s Award Agreement, all NQSOs granted to a
Participant under this Article 6 shall be exercisable during his or her lifetime
only by such Participant.

6.10 Notification of Disqualifying Disposition. If any Participant shall make
any disposition of Shares issued pursuant to the exercise of an Incentive Stock
Option under the circumstances described in Section 421(b) of the Code (relating
to certain disqualifying dispositions), such Participant shall notify the
Company of such disposition within ten (10) days thereof.

Article 7. Stock Appreciation Rights

7.1 Grant of SARs. Subject to the terms and conditions of the Plan, Freestanding
SARs may be granted to Participants at any time and from time to time as shall
be determined by the Board.

It is intended that SARs will not be granted if doing so would result in the
additional tax imposed under Code Section 409A.

Subject to the terms and conditions of the Plan, the Board shall have complete
discretion in determining the number of SARs granted to each Participant and,
consistent with the provisions of the Plan, in determining the terms and
conditions pertaining to such SARs.

The grant price of a Freestanding SAR shall be no less than the Fair Market
Value of a Share on the date of grant of the SAR. Notwithstanding the foregoing,
for SARs granted to Participants outside the United States who are non-U.S.
taxpayers, the Board has the authority to grant SARs at a price that is less
than the Fair Market Value of a Share on the date of grant.

7.2 SAR Agreement. Each SAR Award shall be evidenced by an Award Agreement that
shall specify the grant price, the term of the SAR, and such other provisions as
the Board shall determine.

7.3 Term of SARs. The term of an SAR granted under the Plan shall be determined
by the Board, in its sole discretion, and except as determined otherwise by the
Board and specified in the SAR Award Agreement, no SAR shall be exercisable
later than the tenth (10th) anniversary date of its grant. Notwithstanding the
foregoing, for SARs granted to Participants outside the United States, the Board
has the authority to grant SARs that have a term greater than ten years.

 

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7.4 Exercise of Freestanding SARs. Freestanding SARs may be exercised upon
whatever terms and conditions the Board, in its sole discretion, imposes upon
them.

7.5 Payment of SAR Amount. Upon the exercise of an SAR, a Participant shall be
entitled to receive payment from the Company in an amount determined by
multiplying:

 

  (a) The difference between the Fair Market Value of a Share on the date of
exercise over the grant price; by

 

  (b) The number of Shares with respect to which the SAR is exercised.

At the discretion of the Board, the payment upon SAR exercise may be in cash, in
Shares of equivalent value, in some combination thereof, or in any other manner
approved by the Board at its sole discretion. The Board’s determination
regarding the form of SAR payout shall be set forth in the Award Agreement
pertaining to the grant of the SAR.

7.6 Termination of Employment/Directorship. Each Award Agreement shall set forth
the extent to which the Participant shall have the right to exercise the SAR
following termination of the Participant’s employment or directorship with the
Company, its Affiliates, and/or its Subsidiaries, as the case may be. Such
provisions shall be determined in the sole discretion of the Board, shall be
included in the Award Agreement entered into with Participants, need not be
uniform among all SARs issued pursuant to the Plan, and may reflect distinctions
based on the reasons for termination.

7.7 Nontransferability of SARs. Except as otherwise provided in a Participant’s
Award Agreement, no SAR granted under the 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, except as otherwise provided
in a Participant’s Award Agreement, all SARs granted to a Participant under the
Plan shall be exercisable during his or her lifetime only by such Participant.

Article 8. Restricted Stock and Restricted Stock Units

8.1 Grant of Restricted Stock/Units. Subject to the terms and provisions of the
Plan, the Board, at any time and from time to time, may grant Shares of
Restricted Stock and/or Restricted Stock Units to Participants in such amounts
as the Board shall determine. Restricted Stock Units shall be similar to
Restricted Stock except that no Shares are actually awarded to the Participant
on the date of grant.

8.2 Restricted Stock/Unit Agreement. Each Restricted Stock and/or Restricted
Stock Unit grant shall be evidenced by an Award Agreement that shall specify the
Period(s) of Restriction, the number of Shares of Restricted Stock or the number
of Restricted Stock Units granted, the time and form of settlement, and such
other provisions as the Board shall determine.

8.3 Transferability. Except as provided in this Article 8, the Shares of
Restricted Stock and/or Restricted Stock Units granted herein may not be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated until the
end of the applicable Vesting Period established by the Board and specified in
the Award Agreement (and in the case of Restricted Stock Units until the date of
delivery or other payment), or upon earlier satisfaction of any other
conditions, as specified by the Board in its sole discretion and set forth in
the Award Agreement. All rights with respect to the Restricted Stock and/or
Restricted Stock Units granted to a Participant under the Plan shall be
available during his or her lifetime only to such Participant.

 

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8.4 Other Restrictions. The Board shall impose such other conditions and/or
restrictions on any Shares of Restricted Stock or Restricted Stock Units 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 or each Restricted Stock Unit, restrictions based upon the
achievement of specific performance goals, time-based restrictions on vesting
following the attainment of the performance goals, time-based restrictions,
and/or restrictions under applicable federal or state securities laws.

To the extent deemed appropriate by the Board, the Company may retain the
certificates representing Shares of Restricted Stock in the Company’s possession
until such time as all conditions and/or restrictions applicable to such Shares
have been satisfied or lapse.

Except as otherwise provided in this Article 8, Shares of Restricted Stock
covered by each Restricted Stock Award shall become freely transferable by the
Participant after all conditions and restrictions applicable to such Shares have
been satisfied or lapse, and Restricted Stock Units shall be paid in cash,
Shares, or a combination of cash and Shares as the Board, in its sole discretion
shall determine.

8.5 Voting Rights. To the extent permitted or required by law, as determined by
the Board, Participants holding Shares of Restricted Stock granted hereunder may
be granted the right to exercise full voting rights with respect to those Shares
during the Vesting Period. A Participant shall have no voting rights with
respect to any Restricted Stock Units granted hereunder.

8.6 Dividends and Other Distributions. During the Vesting Period, Participants
holding Shares of Restricted Stock or Restricted Stock Units granted hereunder
may, if the Board so determines, be credited with dividends paid with respect to
the underlying Shares or dividend equivalents while they are so held in a manner
determined by the Board in its sole discretion. The Board may apply any
restrictions to the dividends or dividend equivalents that the Board deems
appropriate. The Board, in its sole discretion, may determine the form of
payment of dividends or dividend equivalents, including cash, Shares, Restricted
Stock, or Restricted Stock Units.

8.7 Termination of Employment/Directorship. Each Award Agreement shall set forth
the extent to which the Participant shall have the right to retain Restricted
Stock and/or Restricted Stock Units following termination of the Participant’s
employment or directorship with the Company, its Affiliates, and/or its
Subsidiaries, as the case may be. Such provisions shall be determined in the
sole discretion of the Board, shall be included in the Award Agreement entered
into with each Participant, need not be uniform among all Shares of Restricted
Stock or Restricted Stock Units issued pursuant to the Plan, and may reflect
distinctions based on the reasons for termination.

8.8 Section 83(b) Election. The Board may provide in an Award Agreement that the
Award of Restricted Stock is conditioned upon the Participant making or
refraining from making an election with respect to the Award under Section 83(b)
of the Code. If a Participant makes an election pursuant to Section 83(b) of the
Code concerning a Restricted Stock Award, the Participant shall be required to
promptly file a copy of such election with the Company.

 

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Article 9. Performance Units/Performance Shares

9.1 Grant of Performance Units/Performance Shares. Subject to the terms of
the Plan, Performance Units and/or Performance Shares may be granted to
Participants in such amounts and upon such terms, and at any time and from time
to time, as shall be determined by the Board.

9.2 Value of Performance Units/Performance Shares. Each Performance Unit shall
have an initial value that is established by the Board at the time of grant.
Each Performance Share shall have an initial value equal to the Fair Market
Value of a Share on the date of grant. The Board shall set performance goals in
its discretion which, depending on the extent to which they are met, will
determine the value and/or number of Performance Units/Performance Shares that
will be paid out to the Participant.

9.3 Earning of Performance Units/Performance Shares. Subject to the terms of
this Plan, after the applicable Performance Period has ended, the holder of
Performance Units/Performance Shares shall be entitled to receive payout on the
value and number of Performance Units/Performance Shares earned by the
Participant over the Performance Period, to be determined as a function of the
extent to which the corresponding performance goals have been achieved.

9.4 Form and Timing of Payment of Performance Units/Performance Shares. Payment
of earned Performance Units/Performance Shares shall be as determined by the
Board and as evidenced in the Award Agreement. Subject to the terms of the Plan,
the Board, in its sole discretion, may pay earned Performance Units/Performance
Shares in the form of cash or in Shares (or in a combination thereof) equal to
the value of the earned Performance Units/Performance Shares at the close of the
applicable Performance Period. Any Shares may be granted subject to any
restrictions deemed appropriate by the Board. The determination of the Board
with respect to the time and form of payout of such Awards shall be set forth in
the Award Agreement pertaining to the grant of the Award.

9.5 Dividends and Other Distributions. At the discretion of the Board,
Participants holding Performance Shares may be entitled to receive dividend
equivalents with respect to dividends declared with respect to the Shares. Such
dividends may be subject to the accrual, forfeiture, or payout restrictions as
determined by the Board in its sole discretion.

9.6 Termination of Employment/Directorship. Each Award Agreement shall set forth
the extent to which the Participant shall have the right to retain Performance
Units and/or Performance Shares following termination of the Participant’s
employment or directorship with the Company, its Affiliates, and/or its
Subsidiaries, as the case may be. Such provisions shall be determined in the
sole discretion of the Board, shall be included in the Award Agreement entered
into with each Participant, need not be uniform among all Awards of Performance
Units or Performance Shares issued pursuant to the Plan, and may reflect
distinctions based on the reasons for termination.

9.7 Nontransferability. Except as otherwise provided in a Participant’s Award
Agreement, Performance Units/Performance Shares may not be sold, transferred,
pledged, assigned, or otherwise alienated or hypothecated, other than by will or
by the laws of descent and distribution. Further, except as otherwise provided
in a Participant’s Award Agreement, a Participant’s rights under the Plan shall
be exercisable during the Participant’s lifetime only by the Participant.

 

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Article 10. Cash-Based Awards

10.1 Grant of Cash-Based Awards. Subject to the terms of the Plan, Cash-Based
Awards may be granted to Participants in such amounts and upon such terms, and
at any time and from time to time, as shall be determined by the Board.

10.2 Value of Cash-Based Awards. Each Cash-Based Award shall have a value as may
be determined by the Board. The Board may establish performance goals in its
discretion. If the Board exercises its discretion to establish performance
goals, the number and/or value of Cash-Based Awards that will be paid out to the
Participant will depend on the extent to which the performance goals are met.

10.3 Earning of Cash-Based Awards. Subject to the terms of this Plan, the holder
of Cash-Based Awards shall be entitled to receive payout on the number and value
of Cash-Based Awards earned by the Participant, to be determined as a function
of the extent to which applicable performance goals, if any, have been achieved.

10.4 Form and Timing of Payment of Cash-Based Awards. Payment of earned
Cash-Based Awards shall be as determined by the Board and as evidenced in the
Award Agreement. Subject to the terms of the Plan, the Board, in its sole
discretion, may pay earned Cash-Based Awards in the form of cash or in Shares
(or in a combination thereof) that have an aggregate Fair Market Value equal to
the value of the earned Cash-Based Awards. Such Shares may be granted subject to
any restrictions deemed appropriate by the Board. The determination of the Board
with respect to the time and form of payout of such Awards shall be set forth in
the Award Agreement pertaining to the grant of the Award.

10.5 Termination of Employment/Directorship. Each Award Agreement shall set
forth the extent to which the Participant shall have the right to receive
Cash-Based Awards following termination of the Participant’s employment or
directorship with the Company, its Affiliates, and/or its Subsidiaries, as the
case may be. Such provisions shall be determined in the sole discretion of the
Board, shall be included in the Award Agreement entered into with each
Participant, need not be uniform among all Awards of Cash-Based Awards issued
pursuant to the Plan, and may reflect distinctions based on the reasons for
termination.

10.6 Nontransferability. Except as otherwise provided in a Participant’s Award
Agreement, Cash-Based Awards may not be sold, transferred, pledged, assigned, or
otherwise alienated or hypothecated, other than by will or by the laws of
descent and distribution. Further, except as otherwise provided in a
Participant’s Award Agreement, a Participant’s rights under the Plan shall be
exercisable during the Participant’s lifetime only by the Participant.

Article 11. Performance Measures

Unless and until the Board proposes for stockholder vote and the stockholders
approve a change in the general Performance Measures set forth in this Article
11, the performance goals upon which the payment or vesting of an Award to a
Covered Employee (other than an Annual Management Incentive Award awarded or
credited pursuant to Article 12) that is intended to qualify as
Performance-Based Compensation shall be limited to the following Performance
Measures:

 

  (a) Net earnings;

 

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  (b) Earnings per share;

 

  (c) Net sales growth;

 

  (d) Net income (before or after taxes);

 

  (e) Net operating profit;

 

  (f) Return measures (including, but not limited to, return on assets, capital,
equity, or sales);

 

  (g) Cash flow (including, but not limited to, operating cash flow and free
cash flow);

 

  (h) Cash flow return on capital;

 

  (i) Earnings before or after taxes, interest, depreciation, and/or
amortization;

 

  (j) Gross or operating margins;

 

  (k) Productivity ratios;

 

  (l) Share price (including, but not limited to, growth measures and total
stockholder return);

 

  (m) Expense targets; and

 

  (n) Working capital targets.

Any Performance Measure(s) may be used to measure the performance of the Company
as a whole or any business unit of the Company or any combination thereof, as
the Board may deem appropriate, or any of the above Performance Measures as
compared to the performance of a group of comparator companies, or published or
special index that the Board, in its sole discretion, deems appropriate, or the
Company may select Performance Measure (l) above as compared to various stock
market indices. The Board also has the authority to provide for accelerated
vesting of any Award based on the achievement of performance goals pursuant to
the Performance Measures specified in this Article 11.

The Board may provide in any such Award that any evaluation of performance may
include or exclude any of the following events that occurs during a Performance
Period: (a) asset write-downs, (b) litigation or claim judgments or settlements,
(c) the effect of changes in tax laws, accounting principles, or other laws or
provisions affecting reported results, (d) accruals for reorganization and
restructuring programs, (e) extraordinary nonrecurring items as described in
Accounting Principles Board Opinion No. 30 and/or in management’s discussion and
analysis of financial condition and results of operations appearing in the
Company’s annual report to stockholders for the applicable year,
(f) acquisitions or divestitures, and (g) foreign exchange gains and losses. To
the extent such inclusions or exclusions affect Awards to Covered Employees,
they shall be prescribed in a form that meets the requirements of Code
Section 162(m) for deductibility.

Awards that are designed to qualify as Performance-Based Compensation, and that
are held by Covered Employees, may not be adjusted upward (the Board shall
retain the discretion to adjust such Awards downward).

In the event that applicable tax and/or securities laws change to permit Board
discretion to alter the governing Performance Measures without obtaining
stockholder approval of such changes, the Board shall have sole discretion to
make such changes without obtaining stockholder approval, provided the exercise
of such discretion does not violate Code Section 409A. In addition, in the event
that the Board determines that it is advisable to grant Awards that shall not
qualify as Performance-Based Compensation, the Board may make such grants
without satisfying the requirements of Code Section 162(m).

 

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Article 12. Annual Management Incentive Awards

The Board may designate Company executive officers who are eligible to receive a
monetary payment in any Fiscal Year based on a percentage of an incentive pool
equal to five percent (5%) of the Company’s consolidated operating earnings for
the Fiscal Year. The Board shall allocate an incentive pool percentage to each
designated Participant for each Fiscal Year. In no event may the incentive pool
percentage for any one Participant exceed thirty percent (30%) of the total
pool. Consolidated operating earnings shall mean the consolidated earnings
before income taxes of the Company, computed in accordance with generally
accepted accounting principles, but shall exclude the effects of Extraordinary
Items.

For purposes of this Article 12, “Extraordinary Items” shall mean
(i) extraordinary, unusual, and/or nonrecurring items of gain or loss;
(ii) gains or losses on the disposition of a business; (iii) changes in tax or
accounting regulations or laws; or (iv) the effect of a merger or acquisition,
all of which must be identified in the audited financial statements, including
footnotes, or Management Discussion and Analysis section of the Company’s annual
report.

As soon as possible after the determination of the incentive pool for a Fiscal
Year, the Board shall calculate the Participant’s allocated portion of the
incentive pool based upon the percentage established at the beginning of the
Fiscal Year. The Participant’s Annual Management Incentive Award then shall be
determined by the Board based on the Participant’s allocated portion of the
incentive pool subject to adjustment in the sole discretion of the Board. In no
event may the portion of the incentive pool allocated to a Participant who is a
Covered Employee be increased in any way, including as a result of the reduction
of any other Participant’s allocated portion.

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
Company, and will be effective only when filed by the Participant in writing
with the Company 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 Board 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 exercise of an Option or SAR, the lapse
or waiver of restrictions with respect to Restricted Stock or Restricted Stock
Units, or the satisfaction of any requirements or performance goals with respect
to Annual Management Incentive Awards, Performance Shares, Performance Units,
and Cash-Based Awards, provided any deferral does not violate Section 409A. If
any such deferral election is required or permitted, the Board shall, in its
sole discretion, establish rules and procedures for such payment deferrals.

Article 15. Rights of Employees/Directors

15.1 Employment/Directorship. Nothing in the Plan or an Award Agreement shall
interfere with or limit in any way the right of the Company to terminate any
Participant’s employment or other service relationship at any time, nor confer
upon any Participant any right to continue in the capacity in which he or she is
employed or otherwise serves the Company.

 

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Neither an Award nor any benefits arising under this Plan shall constitute part
of an employment contract with the Company, its Affiliates, and/or Subsidiaries
and, accordingly, subject to Article 3 and Section 17.1, this Plan and the
benefits hereunder may be terminated at any time in the sole and exclusive
discretion of the Board without giving rise to liability on the part of the
Company, its Affiliates, and/or its Subsidiaries for severance payments.

15.2 Participation. No Employee or Director 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.

15.3 Rights as a Stockholder. A Participant shall have none of the rights of a
stockholder with respect to Shares covered by any Award until the Participant
becomes the record holder of such Shares.

Article 16. Change in Control

16.1 Change in Control of the Company. 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, or unless the Board shall determine otherwise in the Award
Agreement:

 

  (a) Any and all Options and SARs granted hereunder shall become immediately
exercisable; additionally, if a Participant’s employment or directorship is
terminated for any other reason except cause within twelve (12) months of such
Change in Control, the Participant shall have until the earlier of: (i) twelve
(12) months following such termination date, or (ii) the expiration of the
Option or SAR Term, to exercise any such Option or SAR;

 

  (b) Any Vesting Period imposed on Restricted Stock or Restricted Stock Units
shall lapse;

 

  (c) Annual Management Incentive Awards shall be paid out based on the
consolidated operating earnings of the Fiscal Year immediately preceding the
year of the Change in Control or such other method of payment as may be
determined by the Board at the time of the Award or thereafter but prior to the
Change in Control; and

 

  (d) The target payout opportunities attainable under all outstanding Awards of
performance-based Restricted Stock, performance-based Restricted Stock Units,
Performance Units, Performance Shares, and performance-based Cash-Based Awards
shall be deemed to have been fully earned as of the effective date of the Change
in Control.

 

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  (i) The vesting of all Awards denominated in Shares shall be accelerated as of
the effective date of the Change in Control, and there shall be paid out to
Participants within thirty (30) days following the effective date of the Change
in Control, a pro rata number of Shares based upon an assumed achievement of all
relevant targeted performance goals and upon the length of time within the
Performance Period that has elapsed prior to the Change in Control. The Board
has the authority to pay all or any portion of the value of the Shares in cash.

 

  (ii) Awards denominated in cash shall be paid pro rata to Participants in cash
within thirty (30) days following the effective date of the Change in Control,
with the proration determined as a function of the length of time within the
Performance Period that has elapsed prior to the Change in Control, and based on
an assumed achievement of all relevant targeted performance goals.

16.2 Sale of a Division of the Company. Notwithstanding any other provisions of
this Plan, if there is a sale of a division of the Company, unless otherwise
specifically prohibited under applicable laws, or by the rules and regulations
of any governing governmental agencies or national securities exchanges, or
unless the Board shall determine otherwise in the Award Agreement with respect
to any Employee of such division, the following shall apply with respect to any
Employee of such division whose employment by the Company is terminated as a
result of the sale of said division or any Employee of such division who remains
employed by the Company after the sale of the division but who is terminated by
the Company (other than a termination for cause as defined in the applicable
Award Agreement) within twenty-four (24) months of the sale of said division:

 

  (a) Any and all Options and SARs granted hereunder shall become immediately
vested and exercisable, and shall remain exercisable until the earlier of:
(i) twelve (12) months following the effective date of the Employee’s
termination of employment with the Company, or (ii) the expiration of the Option
or SAR Term;

 

  (b) Any Vesting Period imposed on Restricted Stock or Restricted Stock Units
shall lapse;

 

  (c) Annual Management Incentive Awards shall be paid out based on the
consolidated operating earnings of the Fiscal Year immediately preceding the
year of an Employee’s termination of employment with the Company, or such other
method of payment as may be determined by the Board at the time of the Award or
thereafter but prior to the sale of the division; and

 

  (d) The target payout opportunities attainable under all outstanding Awards of
performance-based Restricted Stock, performance-based Restricted Stock Units,
Performance Units, Performance Shares, and performance-based Cash-Based Awards
shall be deemed to have been fully earned for the entire Performance Period(s)
as of the date of the Employee’s termination of employment due to the sale of
the division.

 

  (i) The vesting of all Awards denominated in Shares shall be accelerated as of
the effective date of the Employee’s termination of employment, and there shall
be paid out to Participants within thirty (30) days following the effective date
of the Employee’s termination of employment a pro rata number of Shares based
upon an assumed achievement of all relevant targeted performance goals and upon
the length of time within the Performance Period that has elapsed prior to the
termination of employment. The Board has the authority to pay all or any portion
of the value of the Shares in cash.

 

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  (ii) Awards denominated in cash shall be paid pro rata to Participants in cash
within thirty (30) days following the effective date of the termination of
employment, with the proration determined as a function of the length of time
within the Performance Period that has elapsed prior to the termination of
employment, and based on an assumed achievement of all relevant targeted
performance goals.

For purposes of this Section 16.2, sale of a division means a sale of any
segment of the Company and its subsidiaries if the gross revenue of the segment
exceeds twenty percent (20%) of the consolidated gross revenues of the Company
and its subsidiaries for the immediately prior fiscal year. A cessation of
operation of a division shall not constitute a sale. For the purpose of this
Section 16.2, subsidiaries means ownership, directly or indirectly, by the
Company, of more than fifty percent (50%) of the outstanding voting shares or
the total combined voting power of any corporation, partnership, joint venture,
limited liability company, or other entity (other than the Company) in an
unbroken chain of entities beginning with the Company.

16.3 Section 409A. Notwithstanding anything to the contrary under Section 16.1
or Section 16.2, if a Change in Control or sale of a division of the Company
does not meet the definition of a Change in Control under Section 409A, and if a
payment under either of these sections would result in the imposition of the
additional tax under Section 409A, then such payment will occur at the time
otherwise specified under the related Award Agreement.

Article 17. Amendment, Modification, Suspension, and Termination

17.1 Amendment, Modification, Suspension, and Termination. The Board may, at
any time and from time to time, alter, amend, modify, suspend, or terminate the
Plan in whole or in part. The Board may also require that payments of
nonqualified deferred compensation (as defined under Code Section 409A) be
delayed in accordance with Section 1.409A-2(b)(7). Notwithstanding anything
herein to the contrary, without the prior approval of the Company’s
stockholders, Options issued under the Plan will not be repriced, replaced, or
regranted through cancellation, or by lowering the exercise price of a
previously granted Option. No amendment of the Plan shall be made without
stockholder approval if stockholder approval is required by law, regulation, or
stock exchange rule.

17.2 Adjustment of Awards Upon the Occurrence of Certain Unusual or Nonrecurring
Events. The Board may make adjustments in the terms and conditions of, and the
criteria included in, Awards in recognition of unusual or nonrecurring events
(including, without limitation, the events described in Section 4.2 hereof)
affecting the Company or the financial statements of the Company or of changes
in applicable laws, regulations, or accounting principles, whenever the Board
determines that such adjustments are appropriate in order to prevent unintended
dilution or enlargement of the benefits or potential benefits intended to be
made available under the Plan. The determination of the Board as to the
foregoing adjustments, if any, shall be conclusive and binding on Participants
under the Plan.

 

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It is intended that any adjustment made by the Committee under this Section 17.2
will not result in the additional tax imposed under Code Section 409A.

17.3 Awards Previously Granted. Notwithstanding any other provision of the Plan
to the contrary, no termination, amendment, suspension, or modification of the
Plan shall adversely affect in any material way any Award previously granted
under the Plan, without the written consent of the Participant holding such
Award.

Article 18. Withholding

18.1 Tax Withholding. The Company shall have the power and the right to deduct
or withhold, or require a Participant to remit to the Company, the minimum
statutory amount 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.

18.2 Share Withholding. With respect to withholding required upon the exercise
of Options or SARs, upon the lapse of restrictions on Restricted Stock and
Restricted Stock Units, or upon the achievement of performance goals related to
Performance Shares, or any other taxable event arising as a result of Awards
granted hereunder, Participants may elect, subject to the approval of the Board,
to satisfy the withholding requirement, in whole or in part, by having the
Company withhold Shares having a Fair Market Value on the date the tax is to be
determined equal to the minimum statutory total tax that could be imposed on the
transaction. All such elections shall be irrevocable, made in writing, and
signed by the Participant, and shall be subject to any restrictions or
limitations that the Board, in its sole discretion, deems appropriate.

Article 19. Indemnification

Each person who is or shall have been a member of the Board, or a Committee
appointed by the Board, or an officer of the Company to whom authority was
delegated in accordance with Article 3 shall be indemnified and held harmless by
the Company 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 Company’s approval, or paid by him or
her in satisfaction of any judgment in any such action, suit, or proceeding
against him or her, provided he or she shall give 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, unless such loss, cost,
liability, or expense is a result of his or her own willful misconduct or except
as expressly provided by statute.

The foregoing right of indemnification shall not be exclusive of any other
rights of indemnification to which such persons may be entitled under 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.

Article 20. Successors

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

 

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Article 21. General Provisions

21.1 Forfeiture Events. The Board may specify in an Award Agreement that the
Participant’s rights, payments, and benefits with respect to an Award shall be
subject to reduction, cancellation, forfeiture, or recoupment upon the
occurrence of certain specified events, in addition to any otherwise applicable
vesting or performance conditions of an Award. Such events shall include, but
shall not be limited to, termination of employment for cause, violation of
material Company, Affiliate, and/or Subsidiary policies, breach of
noncompetition, confidentiality, or other restrictive covenants that may apply
to the Participant, or other conduct by the Participant that is detrimental to
the business or reputation of the Company, its Affiliates, or its Subsidiaries.

21.2 Legend. The certificates for Shares may include any legend which the Board
deems appropriate to reflect any restrictions on transfer of such Shares.

21.3 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.

21.4 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.

21.5 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. The Company shall receive the consideration
required by law for the issuance of Awards under the Plan.

21.6 Securities Law Compliance. With respect to Insiders, transactions under
this Plan are intended to comply with all applicable conditions of Rule 16b-3 or
its successor under the Exchange Act. To the extent any provision of the Plan or
action by the Board fails to so comply, it shall be deemed null and void, to the
extent permitted by law and deemed advisable by the Board.

21.7 Listing. The Company may use reasonable endeavors to register Shares
allotted pursuant to the exercise of an Award with the United States Securities
and Exchange Commission or to effect compliance with the registration,
qualification, and listing requirements of any national securities laws, stock
exchange, or automated quotation system.

21.8 Delivery of Title. The Company shall have no obligation to issue or deliver
evidence of title for Shares issued under the Plan prior to:

 

  (a) Obtaining any approvals from governmental agencies that the Company
determines are necessary or advisable; and

 

  (b) Completion of any registration or other qualification of the Shares under
any applicable national or foreign law or ruling of any governmental body that
the Company determines to be necessary or advisable.

 

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21.9 Inability to Obtain Authority. The inability of the Company to obtain
authority from any regulatory body having jurisdiction, which authority is
deemed by the Company’s counsel to be necessary to the lawful issuance and sale
of any Shares hereunder, shall relieve the Company of any liability in respect
of the failure to issue or sell such Shares as to which such requisite authority
shall not have been obtained.

21.10 Investment Representations. The Board may require each person receiving
Shares pursuant to an Award under this Plan to represent and warrant in writing
that the Participant is acquiring the Shares for investment and without any
present intention to sell or distribute such Shares.

21.11 Employees Based Outside of the United States. Notwithstanding any
provision of the Plan to the contrary, in order to comply with the laws in other
countries in which the Company, its Affiliates, and its Subsidiaries operate or
have Employees or Directors, the Board, in their sole discretion, shall have the
power and authority to:

 

  (a) Determine which Affiliates and Subsidiaries shall be covered by the Plan;

 

  (b) Determine which Employees or Directors outside the United States are
eligible to participate in the Plan;

 

  (c) Modify the terms and conditions of any Award granted to Employees or
Directors outside the United States to comply with applicable foreign laws;

 

  (d) Establish subplans and modify exercise procedures and other terms and
procedures, to the extent such actions may be necessary or advisable. Any
subplans and modifications to Plan terms and procedures established under this
Section 21.11 by the Board shall be attached to this Plan document as
appendices; and

 

  (e) Take any action, before or after an Award is made, that it deems advisable
to obtain approval or comply with any necessary local government regulatory
exemptions or approvals.

Notwithstanding the above, the Board may not take any actions hereunder, and no
Awards shall be granted, that would violate the Exchange Act, the Code, any
securities law, or governing statute or any other applicable law.

21.12 Uncertificated Shares. To the extent that the Plan provides for issuance
of certificates to reflect the transfer of Shares, the transfer of such Shares
may be effected on a noncertificated basis, to the extent not prohibited by
applicable law or the rules of any stock exchange.

 

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21.13 Unfunded Plan. Participants shall have no right, title, or interest
whatsoever in or to any investments that the Company may make to aid it in
meeting its obligations under the Plan. Nothing contained in the Plan, and no
action taken pursuant to its provisions, shall create or be construed to create
a trust of any kind, or a fiduciary relationship between the Company and any
Participant, beneficiary, legal representative, or any other person. To the
extent that any person acquires a right to receive payments from the Company
under the Plan, such right shall be no greater than the right of an unsecured
general creditor of the Company. All payments to be made hereunder shall be paid
from the general funds of the Company and no special or separate fund shall be
established and no segregation of assets shall be made to assure payment of such
amounts except as expressly set forth in the Plan.

The Plan is not intended to be subject to ERISA.

21.14 No Fractional Shares. No fractional Shares shall be issued or delivered
pursuant to the Plan or any Award. The Board shall determine whether cash,
Awards, or other property shall be issued or paid in lieu of fractional Shares
or whether such fractional Shares or any rights thereto shall be forfeited or
otherwise eliminated.

21.15 Governing Law. The Plan and each Award Agreement shall be governed by the
laws of the State of Illinois, excluding any conflicts or choice of law rule or
principle that might otherwise refer construction or interpretation of the Plan
to the substantive law of another jurisdiction. Unless otherwise provided in the
Award Agreement, recipients of an Award under the Plan are deemed to submit to
the exclusive jurisdiction and venue of the federal or state courts of Illinois,
to resolve any and all issues that may arise out of or relate to the Plan or any
related Award Agreement.

21.16 Deferred Compensation. It is intended that any Award made under this Plan
that results in the deferral of compensation (as defined under Code
Section 409A) complies with the requirements of Code Section 409A.

 

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