EXHIBIT 10.7
AMENDED AND RESTATED
NEUROCRINE BIOSCIENCES, INC. NONQUALIFIED DEFERRED COMPENSATION PLAN
As Amended and Restated on August 1, 2007

 

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Table of Contents

              PAGE
ARTICLE 1 DEFINITIONS
    1  
 
       
1.1   “Account Balance”
    1  
1.2   “Accounts”
    1  
1.3   “Administrator”
    1  
1.4   “Annual Bonus”
    1  
1.5   “Annual Company Contribution Amount”
    2  
1.6   “Annual Company Matching Amount”
    2  
1.7   “Annual Deferral Amount”
    2  
1.8   “Annual Installment Method”
    2  
1.9   “Base Annual Salary”
    2  
1.10 “Beneficiary”
    2  
1.11 “Beneficiary Designation Form”
    2  
1.12 “Board”
    2  
1.13 “Cause”
    3  
1.14 A “Change in Control”
    3  
1.15 “Change in Control Benefit”
    4  
1.16 “Claimant”
    4  
1.17 “Code”
    4  
1.18 “Committee”
    4  
1.19 “Company”
    4  
1.20 “Company Contribution Account”
    5  
1.21 “Company Matching Account”
    5  
1.22 “Company Stock Measurement Fund”
    5  
1.23 “Deduction Limitation”
    5  
1.24 “Deferral Account”
    5  
1.25 “Director”
    5  
1.26 “Director Fees”
    5  
1.27 “Disability”
    5  
1.28 “Disability Benefit”
    6  
1.29 “Election Form”
    6  
1.30 “Employee”
    6  
1.31 “Employer(s) “
    6  

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Table of Contents
(CONTINUED)

              PAGE
1.32 “ERISA”
    6  
1.33 “Exchange Act”
    6  
1.34 “Excise Tax Limitation”
    6  
1.35 “Fixed Date Payout”
    6  
1.36 “Fixed Date Payout Account Balance”
    7  
1.37 “Key Employee”
    7  
1.38 “Measurement Fund”
    7  
1.39 “Non-Employee Director”
    7  
1.40 “Participant”
    7  
1.41 “Plan”
    7  
1.42 “Plan Year”
    7  
1.43 “Post-December 31, 2004 Deferrals”
    7  
1.44 “Pre-Retirement Survivor Benefit”
    7  
1.45 “Retirement”, “Retire(s)” or “Retired”
    7  
1.46 “Retirement Benefit”
    8  
1.47 “RSU Account”
    8  
1.48 “RSU Award”
    8  
1.49 “RSU Deferral Amount”
    8  
1.50 “Rule 16b-3”
    8  
1.51 “Securities Act”
    8  
1.52 “Stock”
    8  
1.53 “Termination Benefit”
    8  
1.54 “Termination of Employment”
    8  
1.55 “Trust”
    8  
1.56 “Unforeseeable Financial Emergency”
    8  
1.57 “Years of Service”
    9  
 
       
ARTICLE 2 SELECTION, ENROLLMENT, ELIGIBILITY
    9  
 
       
2.1 Selection by Administrator
    9  
2.2 Enrollment Requirements
    9  
2.3 Eligibility; Commencement of Participation
    9  
2.4 Termination of Participation and/or Deferrals
    9  
 
       
ARTICLE 3 DEFERRAL COMMITMENTS/COMPANY CONTRIBUTIONS/CREDITING/TAXES
    9  

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Table of Contents
(CONTINUED)

              PAGE
3.1 Election to Defer; Effect of Election Form
    9  
3.2 Minimum Deferrals for Base Annual Salary, Annual Bonus and/or Director Fees
    10  
3.3 Maximum Deferral
    11  
3.4 Accounts; Crediting of Deferrals
    11  
3.5 Vesting
    12  
3.6 Earnings Credits or Losses
    12  
3.7 Distributions
    14  
 
       
ARTICLE 4 DISTRIBUTIONS
    14  
 
       
4.1 Fixed Date Payout
    14  
4.2 Retirement Benefit
    15  
4.3 Pre-Retirement Survivor Benefit
    15  
4.4 Termination Benefit
    15  
4.5 Disability Benefit
    16  
4.6 Change in Control Benefit
    16  
4.7 Form of Distributions
    17  
 
       
ARTICLE 5 UNFORESEEABLE FINANCIAL EMERGENCIES; WITHDRAWAL ELECTION
    17  
 
       
5.1 Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies
    17  
5.2 Withdrawal Election
    17  
 
       
ARTICLE 6 BENEFICIARY DESIGNATION
    17  
 
       
6.1 Beneficiary
    17  
6.2 Beneficiary Designation; Change
    18  
6.3 No Beneficiary Designation
    18  
6.4 Doubt as to Beneficiary
    18  
6.5 Discharge of Obligations
    18  
 
       
ARTICLE 7 LEAVE OF ABSENCE
    18  
 
       
7.1 Paid Leave of Absence
    18  
7.2 Unpaid Leave of Absence; Disability Leave
    18  
 
       
ARTICLE 8 TERMINATION, AMENDMENT OR MODIFICATION
    19  
 
       
8.1 Termination
    19  
8.2 Amendment
    19  
8.3 Effect of Payment
    20  
 
       
ARTICLE 9 ADMINISTRATION
    20  

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Table of Contents
(CONTINUED)

              PAGE
9.1 Administrator Duties
    20  
9.2 Binding Effect of Decisions
    20  
9.3 Committee
    20  
9.4 Indemnification
    20  
9.5 Employer Information
    21  
 
       
ARTICLE 10 CLAIMS PROCEDURES
    21  
 
       
10.1 Presentation of Claim
    21  
10.2 Notification of Decision
    21  
10.3 Review of a Denied Claim
    21  
10.4 Decision on Review
    22  
10.5 Designation
    22  
10.6 Arbitration
    22  
 
       
ARTICLE 11 TRUST
    23  
 
       
11.1 Establishment of the Trust
    23  
11.2 Interrelationship of the Plan and the Trust
    23  
11.3 Investment of Trust Assets
    23  
11.4 Distributions From the Trust
    23  
 
       
ARTICLE 12 PROVISIONS RELATING TO SECURITIES LAWS
    23  
 
       
12.1 Designation of Participants
    23  
12.2 Action by Committee
    23  
12.3 Compliance with Section 16
    23  
 
       
ARTICLE 13 MISCELLANEOUS
    24  
 
       
13.1 Status of Plan
    24  
13.2 Unsecured General Creditor
    24  
13.3 Employer’s Liability
    24  
13.4 Nonassignability
    24  
13.5 Tax Withholding
    24  
13.6 Coordination with Other Benefits
    25  
13.7 Compliance
    25  
13.8 Not a Contract of Employment
    25  
13.9 Furnishing Information
    25  
13.10 Governing Law
    25  

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Table of Contents
(CONTINUED)

              PAGE
13.11 Notice
    25  
13.12 Successors
    26  
13.13 Spouse’s Interest
    26  
13.14 Validity
    26  
13.15 Incompetent
    26  
13.16 Court Order
    26  
13.17 Distribution in the Event of Taxation
    27  
13.18 Insurance
    27  
13.19 Savings Clause
    27  

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AMENDED AND RESTATED
NEUROCRINE BIOSCIENCES, INC.
NONQUALIFIED DEFERRED COMPENSATION PLAN
As Amended and Restated on August 1, 2007
Purpose
     Neurocrine Biosciences, Inc., a Delaware corporation (the “Company”)
established, originally effective December 1, 1996, the Neurocrine Biosciences,
Inc. Nonqualified Deferred Compensation Plan (the “Plan”), for the benefit of a
select group of management and highly compensated Employees and Directors who
contribute materially to the continued growth, development and future business
success of the Company and its subsidiaries, if any, that sponsor this Plan.
This Plan shall be unfunded for tax purposes and for purposes of Title I of
ERISA. The Company hereby amends and restates the Plan in its entirety effective
August 1, 2007 as set forth herein.
     This Plan shall consist of two plans, one for the benefit of a select group
of management and highly compensated Employees of the Employers as described in
Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA, and one for the benefit of
Non-Employee members of the boards of directors of any Employer. To the extent
required by law, the terms of this Plan applicable to Directors shall also
constitute a separate written plan document with its terms set forth in the
applicable portions of this Plan.
ARTICLE 1
DEFINITIONS
     As used within this document, the following words and phrases have the
meanings described in this Article 1 unless a different meaning is required by
the context. Some of the words and phrases used in the Plan are not defined in
this Article 1, but for convenience, are defined as they are introduced into the
text. Words in the masculine gender shall be deemed to include the feminine
gender. Any headings used are included for ease of reference only and are not to
be construed so as to alter any of the terms of the Plan.
     1.1 “Account Balance” shall mean, with respect to a Participant, a credit
on the records of the Employer equal to the sum of (i) the Deferral Account
balance, (ii) the Company Contribution Account balance, (iii) the Company
Matching Account balance, the RSU Account balance. The Account Balance, and each
other specified account balance, shall be a bookkeeping entry only and shall be
utilized solely as a device for the measurement and determination of the amounts
to be paid to a Participant, or his or her designated Beneficiary, pursuant to
this Plan.
     1.2 “Accounts” of a Participant shall mean, as the context indicates,
either or all of his or her Deferral Account, Company Contribution Account,
Company Matching Account and RSU Account.
     1.3 “Administrator” shall mean the Committee appointed pursuant to
Article 9 to administer the Plan, or such other person or persons to whom the
Committee has delegated its duties pursuant to Article 9.
     1.4 “Annual Bonus” shall mean any cash compensation, in addition to Base
Annual Salary, relating to services performed during any calendar year, whether
or not paid in such calendar year or included on the Federal Income Tax Form W-2
for such calendar year, payable to a Participant as an Employee under any
Employer’s annual bonus and cash incentive plans, excluding stock options,
restricted stock, restricted stock units and other equity awards.

1.

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     1.5 “Annual Company Contribution Amount” shall mean, for any one Plan Year,
the amount determined in accordance with Section 3.4(b).
     1.6 “Annual Company Matching Amount” for any one Plan Year shall be the
amount determined in accordance with Section 3.4(c).
     1.7 “Annual Deferral Amount” shall mean that portion of a Participant’s
Base Annual Salary, Annual Bonus and Director Fees that a Participant elects to
defer, and is deferred, in accordance with Article 3, for any one Plan Year. In
the event of a Participant’s Retirement, Termination of Employment as a result
of his or her Disability or death or a Termination of Employment prior to the
end of a Plan Year, such year’s Annual Deferral Amount shall be the actual
amount withheld prior to such event.
     1.8 “Annual Installment Method” shall be an annual installment payment over
the number of years selected by the Participant in accordance with this Plan,
which shall in no event exceed fifteen (15) years, calculated as follows: The
applicable portion of the Account Balance of the Participant (or the applicable
portion of the Fixed Date Payout Account Balance, in the event of a Fixed Date
Payout) shall be calculated as of the close of business three (3) business days
prior to the last business day of the year or the date of the Fixed Date Payout.
The annual installment shall be calculated by multiplying this balance by a
fraction, the numerator of which is one, and the denominator of which is the
remaining number of annual payments due the Participant. By way of example, if
the Participant elects a ten (10) year Annual Installment Method, the first
payment shall be 1/10 of the applicable portion of the Account Balance (or the
Fixed Date Payout Account Balance, in the event of a Fixed Date Payout),
calculated as described in this definition. The following year, the payment
shall be 1/9 of the applicable portion of the Account Balance (or the applicable
portion of the Fixed Date Payout Account Balance, in the event of a Fixed Date
Payout), calculated as described in this definition. Each annual installment
shall be paid within sixty (60) days following each anniversary of the day the
distributions are scheduled to commence.
     1.9 “Base Annual Salary” shall mean the annual cash compensation relating
to services performed during any calendar year, whether or not paid in such
calendar year or included on the Federal Income Tax Form W-2 for such calendar
year, excluding bonuses, commissions, overtime, fringe benefits, stock options,
relocation expenses, incentive payments, non-monetary awards, Director Fees and
other fees, automobile and other allowances paid to a Participant for employment
services rendered (whether or not such allowances are included in the Employee’s
gross income). Base Annual Salary shall be calculated before reduction for
compensation voluntarily deferred or contributed by the Participant pursuant to
all qualified or non qualified plans of any Employer and shall be calculated to
include amounts not otherwise included in the Participant’s gross income under
Code Sections 125, 132(f), 402(e)(3), 402(h), or 403(b) pursuant to plans
established by any Employer; provided, however, that all such amounts will be
included in compensation only to the extent that, had there been no such plan,
the amount would have been payable in cash to the Employee.
     1.10 “Beneficiary” shall mean one or more persons, trusts, estates or other
entities, designated in accordance with Article 6, that are entitled to receive
benefits under this Plan upon the death of a Participant.
     1.11 “Beneficiary Designation Form” shall mean the form established from
time to time by the Administrator that a Participant completes, signs and
returns to the Administrator to designate one or more Beneficiaries.
     1.12 “Board” shall mean the board of directors of the Company.

2.

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     1.13 “Cause” shall mean, with respect to a Participant, the occurrence of
any of the following (in each case determined by the Participant’s Employer (or
the Employer’s Board of Directors, if the Participant is the Employer’s Chief
Executive Officer)):
     (a) any intentional action or intentional failure to act by a Participant
which was performed in bad faith and to the material detriment of the
Participant’s Employer;
     (b) Participant’s intentional refusal or intentional failure to act in
accordance with any lawful and proper direction or order of the Chief Executive
Officer (or the Employer’s Board of Directors, if the Participant is the
Employer’s Chief Executive Officer);
     (c) Participant’s willful and habitual neglect of the duties of employment;
or
     (d) Participant’s conviction of a felony crime involving moral turpitude;
          provided, that in the event any of the foregoing events is capable of
being cured, the Employer (or the Employer’s Board of Directors, if the
Participant is the Employer’s Chief Executive Officer) shall provide written
notice to Participant describing the nature of such event and Participant shall
thereafter have ten (10) business days to cure such event.
     1.14 A “Change in Control” shall be deemed to occur if any of the following
events shall occur:
     (a) the Company is merged or consolidated or reorganized into or with
another corporation or other legal person, and as a result of such merger,
consolidation or reorganization less than fifty percent (50%) of the combined
voting power of the then-outstanding securities of such surviving corporation or
person immediately after such transaction are held in the aggregate by the
holders of voting securities of the Company immediately prior to such
transaction;
     (b) the Company sells all or substantially all of its assets or any other
corporation or other legal person and thereafter less than fifty percent (50%)
of the combined voting securities of the acquiring or consolidated entity are
held in the aggregate by the holders of voting securities of the Company
immediately prior to such sale;
     (c) there is a report filed on Schedule 13D or Schedule 14D-1 (or any
successor schedule, form or report), each as promulgated pursuant to the
Exchange Act, disclosing that any “person” (as such term is used in
Sections 13(d)(3) and 14(d)(2) of the Exchange Act) has become the “beneficial
owner” (as defined in Rule 13d-3 or any successor rule or regulation promulgated
under the Exchange Act), directly or indirectly, of securities of the Company
representing fifty percent (50%) or more of the combined voting power of the
then-outstanding voting securities of the Company;
     (d) the Company shall file a report or proxy statement with the Securities
and Exchange Commission pursuant to the Exchange Act disclosing in response to
Item 1 of Form 8-X thereunder or Item 5(f) of Schedule 14A thereunder (or any
successor schedule, form or report or item therein) that the change in control
of the Company has or may have occurred or will or may occur in the future
pursuant to any then-existing contract or transaction; or
     (e) during any period of two (2) consecutive years, individuals who at the
beginning of any such period constitute the Directors of the Company cease for
any reason to constitute at least a majority thereof unless the election or the
nomination for election by the Company’s

3.

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shareholders of each Director of the Company first elected during such period
was approved by a vote of at least two-thirds (2/3) of the Directors of the
Company then still in office who were Directors of the Company at the beginning
of such period;
          provided, that for purposes of distribution of Post-December 31, 2004
Deferrals under Section 4.6, “Change in Control” shall be limited to:
     (f) the acquisition by any one person, or more than one person acting as a
group (within the meaning of Q&A-12(b) of Internal Revenue Service Notice
2005-1, of ownership of stock of the Company that, together with stock held by
such person or group constitutes more than fifty percent (50%) of the total fair
market value or total voting power of the stock of the Company; provided,
however, that if any one person or more than one person acting as a group, is
considered to own more than fifty percent (50%) of the total fair market value
or total voting power of the stock of the Company, the acquisition of additional
stock by the same person or persons is not considered to be a Change in Control.
Such foregoing definition of Change in Control shall be deemed amended to the
extent necessary to comply with the provisions of Code Section 409A and any
regulations promulgated thereunder.
     (g) Either (i) the acquisition by one person or more than one person acting
as a group during the twelve (12) month period ending on the date of the most
recent acquisition by such person or persons of ownership of stock of the
Company possessing thirty-five percent (35%) or more of the total voting power
of the stock of the Company or (ii) the replacement of a majority of the members
of the Board during any twelve (12) month period by directors whose appointment
or election is not endorsed by a majority of the members of the Company’s Board
prior to the date of the appointment or election; or
     (h) The acquisition by one person or more than one person acting as a group
during the twelve (12) month period ending on the date of the most recent
acquisition, assets from the Company that have a total gross fair market value
equal to or more than forty percent (40%) of the total gross fair market value
of all assets of the Company immediately before such acquisition or
acquisitions. For this purpose, gross fair market value means the value of the
assets of the Company, or the value of the assets being disposed of, determined
without regard to any liabilities associated with such assets.
          Notwithstanding the foregoing, whether a Change in Control has
occurred for purposes of distributions of Post-December 31, 2004 Deferrals shall
be determined in accordance with Code Section 409A, Internal Revenue Service
Notice 2005-1 and any similar authority.
     1.15 “Change in Control Benefit” shall mean the benefit set forth in
Section 4.6.
     1.16 “Claimant” shall have the meaning set forth in Section 10.1.
     1.17 “Code” shall mean the Internal Revenue Code of 1986, as it may be
amended from time to time. Reference to a section of the Code shall include that
section and any comparable section or sections of any future legislation that
amends, supplements or supersedes such section.
     1.18 “Committee” shall mean the Compensation Committee of the Board or
another committee or subcommittee of the Board appointed to administer the Plan
pursuant to Article 9.
     1.19 “Company” shall mean Neurocrine Biosciences, Inc, a Delaware
corporation, and any successor to all or substantially all of the Company’s
assets or business.

4.

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     1.20 “Company Contribution Account” shall mean (i) the sum of all of a
Participant’s Annual Company Contribution Amounts, plus (ii) the hypothetical
deemed investment earnings and losses credited or charged in accordance with all
the applicable provisions of this Plan that relate to the Participant’s Company
Contribution Account, less (iii) all distributions made to the Participant or
his or her Beneficiary pursuant to this Plan that relate to the Participant’s
Company Contribution Account.
     1.21 “Company Matching Account” shall mean (i) the sum of all of a
Participant’s Annual Company Matching Amounts, plus (ii) the hypothetical deemed
investment earnings and losses credited or charged in accordance with all the
applicable provisions of this Plan that relate to the Participant’s Company
Matching Account, less (iii) all distributions made to the Participant or his or
her Beneficiary pursuant to this Plan that relate to the Participant’s Company
Matching Account.
     1.22 “Company Stock Measurement Fund” shall mean the Measurement Fund which
shall be deemed invested in the Company’s Stock. Participants will have no
rights as stockholders of the Company with respect to allocations made to their
RSU Accounts which are deemed invested in the Company Stock Measurement Fund.
     1.23 “Deduction Limitation” shall mean the following described limitation
on a benefit that may otherwise be distributable pursuant to the provisions of
this Plan. Except as otherwise provided, this limitation shall be applied to all
distributions, other than distributions of Post-December 31, 2004 Deferrals,
that are “subject to the Deduction Limitation” under this Plan. If an Employer
determines in good faith that there is a reasonable likelihood that any
compensation paid to a Participant for a taxable year of the Employer would not
be deductible by the Employer solely by reason of the limitation under Code
Section 162(m), then to the extent deemed necessary by the Employer to ensure
that the entire amount of any distribution to the Participant pursuant to this
Plan is deductible, the Employer may defer all or any portion of a distribution
under this Plan, other than a distribution of Post-December 31, 2004 Deferrals.
Any amounts deferred pursuant to this limitation shall continue to be
credited/debited with additional amounts in accordance with Section 3.6 below.
The amounts so deferred and amounts credited thereon shall be distributed to the
Participant or his or her Beneficiary (in the event of the Participant’s death)
at the earliest possible date, as determined by the Employer in good faith, on
which the deductibility of compensation paid or payable to the Participant for
the taxable year of the Employer during which the distribution is made will not
be limited by Section 162(m), or if earlier, the date that is twenty-four
(24) months following the date on which the distribution was first distributable
to the Participant pursuant to the provisions of this Plan.
     1.24 “Deferral Account” shall mean (i) the sum of all of a Participant’s
Annual Deferral Amounts, plus (ii) the hypothetical deemed investment earnings
and losses credited or charged in accordance with all the applicable provisions
of this Plan that relate to the Participant’s Deferral Account, less (iii) all
distributions made to the Participant or his or her Beneficiary pursuant to this
Plan that relate to his or her Deferral Account.
     1.25 “Director” shall mean any member of the board of directors of any
Employer.
     1.26 “Director Fees” shall mean the annual fees paid by any Employer,
including retainer fees and meetings fees, as compensation for serving on the
board of directors.
     1.27 “Disability” shall mean a mental or physical disability as determined
by the Administrator in accordance with standards and procedures similar to
those under the Company’s broad-based regular long-term disability plan, if any.
At any time that the Company does not maintain such a long-term disability plan,
“Disability” shall mean the inability of a Participant, as determined by the
Administrator, substantially to perform such Participant’s regular duties and
responsibilities due to a

5.

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medically determinable physical or mental illness which has lasted, or can
reasonably be expected to last, for a period of six (6) consecutive months, but
only to the extent that such definition does not violate the Americans with
Disabilities Act. Notwithstanding the foregoing, for purposes of distributions
of Post-December 31, 2004 Deferrals under Section 4.5, Disability shall be
limited to any medically determinable mental or physical impairment, which can
be expected to result in death or to last for a continuous period of not less
than twelve (12) months, rendering a Participant (i) unable to engage in any
substantial gainful activity, or (ii) eligible to receive income replacement
benefits for a period of not less than three (3) months under the Company’s
accident and health plan, if any.
     1.28 “Disability Benefit” shall mean the benefit set forth in Section 4.5.
     1.29 “Election Form” shall mean the form established from time to time by
the Administrator that a Participant completes, signs and returns to the
Administrator to make an election under the Plan.
     1.30 “Employee” shall mean a person who is an employee of any Employer.
     1.31 “Employer(s)” shall mean the Company and/or any of its subsidiaries
(now in existence or hereafter formed or acquired) that have been selected by
the Board to participate in the Plan and have adopted the Plan as a sponsor.
     1.32 “Equity Plan” shall mean the Company’s 2003 Incentive Stock Plan and
any successor equity incentive plan adopted by the Company.
     1.33 “ERISA” shall mean the Employee Retirement Income Security Act of
1974, as it may be amended from time to time. Reference to a section of ERISA
shall include that section and any comparable section or sections of any future
legislation that amends, supplements or supersedes such section.
     1.34 “Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended. Reference to a section of the Exchange Act shall include that section
and any comparable section or sections of any future legislation that amends,
supplements or supersedes such section.
     1.35 “Excise Tax Limitation” shall mean the following described limitation
on a benefit that may otherwise be distributable pursuant to the provisions of
this Plan. Except as otherwise provided, this limitation shall be applied to all
distributions that are “subject to the Excise Tax Limitation” under this Plan,
other than Post-December 31, 2004 Deferrals. If an Employer determines in good
faith that there is a reasonable likelihood that any distribution to be paid to
a Participant pursuant to this Plan (other than a distribution of
Post-December 31, 2004 Deferrals) would not be deductible by the Employer solely
because all or a portion of the distribution would constitute an “excess
parachute payment” within the meaning of Code Section 280G, as determined
consistent with the proposed regulations issued by the Internal Revenue Service
under Code Section 280G, then to the extent deemed necessary by the Employer to
ensure that the entire amount of any distribution to the Participant pursuant to
this Plan is deductible, the Employer may defer all or any portion of a
distribution under this Plan. Any amounts deferred pursuant to this limitation
shall continue to be credited/debited with additional amounts in accordance with
Section 3.6 below. The amounts so deferred and amounts credited thereon shall be
distributed to the Participant or his or her Beneficiary (in the event of the
Participant’s death) at the earliest possible date, as determined by the
Employer in good faith, on which the deductibility of compensation paid or
payable to the Participant for the taxable year of the Employer during which the
distribution is made will not be limited or, if earlier, the date that is
twenty-four (24) months following the date on which the distribution was first
distributable to the Participant pursuant to the provisions of this Plan.

6.

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     1.36 “Fixed Date Payout” shall mean the payout set forth in Section 4.1.
     1.37 “Fixed Date Payout Account Balance” shall mean, with respect to a
Participant, a credit on the records of the Employer equal to the sum of (i) the
amount deferred by the Participant and/or Employer contributions made on his or
her behalf and with respect to which a Fixed Date Payout was elected, plus
(ii) amounts credited or debited in the manner provided in Section 3.6 on such
amount. The Fixed Date Payout Account Balance shall be a bookkeeping entry only
and shall be utilized solely as a device for the measurement and determination
of the amounts to be paid to a Participant, or his or her designated
Beneficiary, pursuant to this Plan.
     1.38 “Key Employee” shall mean any Employee who would qualify as a “key
employee” within the meaning of Code Section 416(i), without regard to
Paragraph 5 thereof.
     1.39 “Measurement Fund” shall mean the investment fund or funds selected by
the Administrator from time to time.
     1.40 “Non-Employee Director” shall mean a Director who is not an Employee
of the Company.
     1.41 “Participant” shall mean any Employee or Director (i) who is selected
to participate in the Plan, (ii) who elects to participate in the Plan,
(iii) who signs an Election Form and a Beneficiary Designation Form, (iv) whose
signed Election Form and Beneficiary Designation Form are accepted by the
Administrator, and (v) who commences participation in the Plan. A spouse or
former spouse of a Participant shall not be treated as a Participant in the Plan
or have an account balance under the Plan, even if he or she has an interest in
the Participant’s benefits under the Plan as a result of applicable law or
property settlements resulting from legal separation or divorce.
     1.42 “Plan” shall mean this Amended and Restated Neurocrine Biosciences,
Inc. Nonqualified Deferred Compensation Plan, which shall be evidenced by this
instrument, as amended from time to time.
     1.43 “Plan Year” shall mean a period beginning on January 1 of each
calendar year and continuing through December 31 of such calendar year.
     1.44 “Post-December 31, 2004 Deferrals” means any portion of a
Participant’s Accounts which as of December 31, 2004 were not earned and vested
within the meaning of Internal Revenue Service Notice 2005-1. Post-December 31,
2004 Deferrals shall be subject to Code Section 409A and any regulations
promulgated thereunder. Portions of a Participant’s Account that were earned and
vested as of December 31, 2004 within the meaning of Internal Revenue Service
Notice 2005-1, together with any earnings on such amounts, shall not be
Post-December 31, 2004 Deferrals and shall not be subject to Code Section 409A
and any regulations promulgated thereunder.
     1.45 “Pre-Retirement Survivor Benefit” shall mean the benefit set forth in
Section 4.3.
     1.46 “Retirement”, “Retire(s)” or “Retired” shall mean, with respect to an
Employee, severance from employment from all Employers, and with respect to a
Director who is not an Employee, severance of his or her directorships with all
Employers, for any reason other than a leave of absence, death or Disability on
or after the earlier of the attainment of (a) age sixty-five (65) or (b) age
fifty-five (55) with a minimum of ten (10) Years of Service. For purposes of
deferrals pursuant to deferral elections made after January 12, 2006,
“Retirement” shall mean, with respect to an Employee, severance from employment
from all Employers, and with respect to a Director who is not an Employee,
severance

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of his or her directorships with all Employers, for any reason other than a
leave of absence, death or Disability on or after the earlier of the attainment
of (a) age sixty-five (65) or (b) age fifty-five (55) with a minimum of five
(5) Years of Service. If a Participant is both an Employee and a Director,
Retirement shall not occur until he or she Retires as both an Employee and a
Director. Notwithstanding the foregoing, for purposes of distributions of
Post-December 31, 2004 Deferrals, “Retirement” shall be deemed to mean such
severance from employment and/or directorship as would otherwise constitute a
“separation from service” within the meaning of Code Section 409A(a)(2)(A)(i)
and any regulations promulgated thereunder.
     1.47 “Retirement Benefit” shall mean the benefit set forth in Section 4.2.
     1.48 “RSU Account” shall mean (i) the sum of all of a Participant’s RSU
Deferral Amounts, plus (ii) the hypothetical deemed investment earnings and
losses credited or charged in accordance with all the applicable provisions of
this Plan that relate to the Participant’s RSU Deferral Account, less (iii) all
distributions made to the Participant or his or her Beneficiary pursuant to this
Plan that relate to the Participant’s RSU Account.
     1.49 “RSU Award” shall mean any restricted stock unit award or other
deferred issuance stock award granted by the Company to a Participant that is
eligible to be deferred under the Plan in accordance with the terms of such
award.
     1.50 “RSU Deferral Amount” shall be the amount determined in accordance
with Section 3.4(d).
     1.51 “Rule 16b-3” shall mean that certain Rule 16b-3 under the Exchange
Act, as such Rule may be amended from time to time.
     1.52 “Securities Act” shall mean the Securities Act of 1933, as amended.
     1.53 “Stock” shall mean Neurocrine Biosciences, Inc. common stock.
     1.54 “Termination Benefit” shall mean the benefit set forth in Section 4.4.
     1.55 “Termination of Employment” shall mean the severing of employment with
all Employers, or service as a Director of all Employers, voluntarily or
involuntarily, for any reason other than Retirement, Disability, death or an
authorized leave of absence. If a Participant is both an Employee and a
Director, a Termination of Employment shall occur only upon the termination of
the last position held. Notwithstanding the foregoing, with respect to
distributions of Post-December 31, 2004 Deferrals “Termination of Employment”
shall be deemed to mean such terminations of employment and/or directorship as
would otherwise constitute a “separation from service” within the meaning of
Code Section 409A(a)(2)(A)(i) and any regulations promulgated thereunder.
     1.56 “Trust” shall mean one or more trusts established pursuant to that
certain Trust Agreement, dated as of January 1, 2004, between the Company and
Reliance Trust Company, as amended from time to time, or any successor trust
agreement.
     1.57 “Unforeseeable Financial Emergency” shall mean an unanticipated
emergency that is caused by an event beyond the control of the Participant that
would result in severe financial hardship to the Participant not covered by
insurance, liquidation of other assets (to the extent the liquidation itself
will not cause severe financial hardship or cessation of deferrals under this
Plan, resulting from (i) a sudden and unexpected illness or accident of the
Participant or a dependent (as defined in Section 152(a) of the

8.

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Code) of the Participant, (ii) a loss of the Participant’s property due to
casualty, or (iii) such other extraordinary and unforeseeable circumstances
arising as a result of events beyond the control of the Participant, all as
determined in the sole discretion of the Administrator.
     1.58 “Years of Service” shall mean each twelve (12) month period during
which a Participant is employed by an Employer, whether or not continuous, and
including periods commencing prior to the effective date of this Plan; provided,
however, that in the case of a Participant whose employment with an Employer has
been interrupted by a period of twelve (12) consecutive months or more (a “Break
in Service”), his or her Years of Service prior to such Break in Service shall
be disregarded for any purpose under the Plan.
ARTICLE 2
SELECTION, ENROLLMENT, ELIGIBILITY
     2.1 Selection by Administrator. Participation in the Plan shall be limited
to a select group of management and highly compensated Employees and
Non-Employee Directors of the Employers, as determined by the Administrator in
its sole discretion. Subject to the requirements of Article 11, from that group,
the Administrator shall select, in its sole discretion, Employees and
Non-Employee Directors to participate in the Plan.
     2.2 Enrollment Requirements. As a condition to participation, each selected
Employee or Non-Employee Director shall complete, execute and return to the
Administrator an Election Form and a Beneficiary Designation Form. In addition,
the Administrator shall establish from time to time such other enrollment
requirements as it determines in its sole discretion are necessary.
     2.3 Eligibility; Commencement of Participation. Provided an Employee or
Non-Employee Director selected to participate in the Plan has met all enrollment
requirements set forth in this Plan and required by the Administrator, including
returning all required documents to the Administrator within the specified time
period, that Employee or Non-Employee Director shall commence participation in
the Plan on the day on which his or her Election Form first becomes effective or
the date on which a contribution is first credited to his or her Company
Contribution Account or Company Matching Account, whichever occurs first.
     2.4 Termination of Participation and/or Deferrals. If the Administrator
determines in good faith that a Participant no longer qualifies as a member of a
select group of management or highly compensated Employees, as membership in
such group is determined in accordance with Sections 201(2), 301(a)(3) and
401(a)(1) of ERISA, or as a Non-Employee Director, the Administrator shall have
the right, in its sole discretion, to (a) terminate any deferral election the
Participant has made for the remainder of the Plan Year in which the
Participant’s membership status changes, (b) prevent the Participant from making
future deferral elections and/or (c) other than with respect to
Post-December 31, 2004 Deferrals, immediately distribute the Participant’s then
Account Balance as a Termination Benefit and terminate the Participant’s
participation in the Plan.
ARTICLE 3
DEFERRAL COMMITMENTS/COMPANY CONTRIBUTIONS/CREDITING/TAXES
     3.1 Election to Defer; Effect of Election Form. Subject to the terms and
conditions set forth herein and such terms and conditions as the Administrator
may determine, Participants may elect to defer Base Annual Salary, Annual Bonus
and/or Director Fees by timely completing and delivering to the Administrator an
Election Form prior to the beginning of each Plan Year during such period as may
be established by the Administrator in its discretion for such elections. After
a Plan Year commences, such

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deferral election shall be irrevocable and shall continue for the entire Plan
Year and subsequent years unless otherwise provided in this Plan; provided,
however, that a deferral election shall terminate upon the execution and timely
submission of a newly completed Election Form during a subsequent election
period or Termination of Employment. Additionally, subject to the terms and
conditions set forth herein and such additional terms and conditions as the
Administrator may determine, Participants may elect to defer RSU Awards by
timely completing and delivering to the Administrator an Election Form in
accordance with procedures established by the Administrator.
     (a) Base Annual Salary, Annual Bonus and/or Director Fees. Subject to any
terms and conditions imposed by the Administrator, Participants may elect to
defer, under the Plan, Base Annual Salary, Annual Bonus and/or Director Fees.
For these elections to be valid with respect to deferrals of Base Annual Salary,
Annual Bonus and/or Director Fees, the Election Form must be completed and
signed by the Participant, timely delivered to the Administrator no later than
December 31 of the year immediately preceding the Plan Year for which the
deferral election is to be effective and accepted by the Administrator. If no
such Election Form is timely delivered for a Plan Year, the Annual Deferral
Amount shall be zero for that Plan Year.
     (b) Performance-based Compensation. Notwithstanding the foregoing and
subject to any terms and conditions imposed by the Administrator, in the case of
any performance-based compensation within the meaning of Code
Section 409A(a)(4)(B)(iii) that is a Post-December 31, 2004 Deferral and
deferrable under this Plan, which compensation is based on services performed
for a period of at least twelve (12) months, Participants may elect to defer
such compensation by timely completing and delivering to the Administrator an
Election Form no later than six (6) months before the end of such service period
during such period as may be established by the Administrator in its discretion
for such elections.
     (c) First Plan Year. Notwithstanding the foregoing, in the case of the
first Plan Year in which a Participant becomes eligible to participate in this
Plan, elections may be made with respect to services to be performed subsequent
to such election within thirty (30) days after the date the Participant becomes
eligible to participate in this Plan.
     (d) RSU Awards. Subject to any terms and conditions imposed by the
Administrator, Participants may elect to defer RSU Awards under the Plan. For
these elections to be valid, the Election Form must be completed and signed by
the Participant, timely delivered to and accepted by the Administrator either
(i) no later than thirty (30) days following the grant date of the RSU Award
(which may not vest any earlier than thirteen (13) months following its grant
date), or (ii) such deferral election must otherwise be in compliance with the
requirements of Section 409A of the Code and the regulations and other guidance
thereunder.
     (e) Redeferral. The provisions of this Section 3.1(e) shall not apply to
Post-December 31, 2004 Deferrals, which are governed by the redeferral
provisions in Section 4.1(b). A Participant may annually change his or her
election to an allowable alternative payout method by submitting a new Election
Form to the Administrator during such period as may be established by the
Administrator in its discretion for such elections, provided, however, that such
change shall not be given any effect until at least twelve (12) months after the
date on which the new election is made and only if such new Election Form is
submitted to and accepted by the Administrator in its sole discretion at least
thirteen (13) months prior to the scheduled payout date of the distribution to
be modified. The Election Form most recently accepted by the Administrator shall
govern the payout of the Participant’s benefits under the Plan.
     3.2 Minimum Deferrals for Base Annual Salary, Annual Bonus and/or Director
Fees.

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     (a) Annual Minimum. For each Plan Year, with respect to deferrals of Base
Annual Salary, Annual Bonus and/or Director Fees, the annual aggregate minimum
deferral amount for each Participant is $5,000. If an election is made for less
than such minimum amount, or if no election is made, the amount deferred shall
be zero.
     (b) Short Plan Year. Notwithstanding the foregoing, if a Participant first
becomes a Participant after the first day of a Plan Year the minimum Base Annual
Salary deferral shall be an amount equal to the minimum set forth above,
multiplied by a fraction, the numerator of which is the number of complete
months remaining in the Plan Year and the denominator of which is twelve (12).
     3.3 Maximum Deferral. For each Plan Year, a Participant may elect to defer,
as his or her Annual Deferral Amount, up to one hundred percent (100%) of his or
her Base Annual Salary, Annual Bonus and/or Director Fees. A Participant’s
Annual Deferral Amount may be automatically reduced if the Administrator
determines that such action is necessary to meet federal or state tax
withholding obligations. A Participant may elect to defer up to one hundred
percent (100%) of his or her RSU Awards.
     3.4 Accounts; Crediting of Deferrals. Solely for record keeping purposes,
the Administrator shall establish a Deferral Account, a Company Contribution
Account, a Company Matching Account and a RSU Account for each Participant. A
Participant’s Accounts shall be credited with the deferrals made by him or her
or on his or her behalf by his or her Employer under this Article 3 and shall be
credited (or charged, as the case may be) with the hypothetical or deemed
investment earnings and losses determined pursuant to Section 3.6, and charged
with distributions made to or with respect to him or her.
     (a) Annual Deferral Amounts. For each Plan Year, the Base Annual Salary
portion of the Annual Deferral Amount shall be withheld and credited to the
Participant’s Deferral Account at the time of each regularly scheduled Base
Annual Salary payroll in either the percentages or dollar amounts specified by
the Participant in the Election Form, as adjusted from time to time for
increases and decreases in Base Annual Salary. The Annual Bonus and/or Director
Fees portion of the Annual Deferral Amount shall be withheld and credited to the
Participant’s Deferral Account at the time the Annual Bonus and/or Director Fees
are or otherwise would be paid to the Participant, whether or not this occurs
during the Plan Year itself.
     (b) Annual Company Contribution Amount. For each Plan Year, an Employer, in
its sole discretion, may, but is not required to, credit any amount it desires
to any Participant’s Company Contribution Account under this Plan, which amount
shall be for that Participant the Annual Company Contribution Amount for that
Plan Year. The amount so credited to a Participant may be smaller or larger than
the amount credited to any other Participant, and the amount credited to any
Participant for a Plan Year may be zero, even though one or more other
Participants receive an Annual Company Contribution Amount for that Plan Year.
The Annual Company Contribution Amount, if any, shall be credited to
Participants’ Company Contribution Accounts on the date declared by the
Employer.
     (c) Annual Company Matching Amount. For each Plan Year, an Employer, in its
sole discretion, may, but is not required to, credit any amount it desires to
any Participant’s Company Matching Account under this Plan, which amount shall
be for that Participant the Annual Company Matching Amount for that Plan Year.
The amount so credited to a Participant may be smaller or larger than the amount
credited to any other Participant, and the amount credited to any Participant
for a Plan Year may be zero, even though one or more other Participants receive
an Annual Company Contribution Amount for that Plan Year. The Annual

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Company Contribution Amount, if any, shall be credited to Participants’ Company
Matching Accounts on the date declared by the Employer.
     (d) RSU Deferral Amount. Each time a Participant timely elects to defer a
RSU Award in accordance with Section 3.1(d), an equivalent number of shares of
Company common stock subject to such RSU Award shall be credited to the
Participant’s RSU Account.
     3.5 Vesting.
     (a) A Participant shall at all times be one hundred percent (100%) vested
in his or her Deferral Account.
     (b) A Participant shall vest in his or her RSU Account in accordance with
the vesting schedule applicable to the particular RSU Award, which may vary
among Participants and among RSU Awards. In the event of a Participant’s
Termination of Employment, other than by reason of his or her death or
Disability, prior to the date on which all RSU Awards have vested, the unvested
portion of such RSU Award shall be forfeited and no Employer or the Plan shall
be liable for the distribution of such shares under the Plan to such
Participant. Any shares credited to a Participant’s RSU Account by his or her
Employer that are forfeited by such Participant pursuant to the preceding
sentence shall cease to be liabilities of the Employer or the Plan and such
shares shall be immediately debited from the Participant’s RSU Account.
     (c) Employer contributions credited to a Participant’s Company Contribution
Account under Section 3.4(b) of the Plan or to a Participant’s Company Matching
Account under Section 3.4(c) of the Plan and any hypothetical or deemed
investment earnings and losses attributable to these contributions shall become
vested or nonforfeitable as determined by the Administrator from time to time.
The vesting schedule may vary among Participants.
     (d) In addition, a Participant shall be one hundred percent (100%) vested
in his or her Company Contribution Account and Company Matching Account,
including any deemed investment earnings and losses attributable to these
accounts, immediately prior to the effective date of a Change in Control,
immediately upon his or her death and immediately upon his or her Termination of
Employment as a result of Disability. In the event of a Participant’s
Termination of Employment, other than by reason of his or her death or
Disability, prior to the date on which all Employer contributions in such
Participant’s Company Contribution Account and Company Matching Account have
vested pursuant to this Section 3.5, the unvested portion of such Employer
contributions shall be forfeited and no Employer or the Plan shall be liable for
the payment of such unvested amounts under the Plan to such Participant. Any
amounts credited to a Participant’s Company Contribution Account and Company
Matching Account by his or her Employer on his or her behalf which are forfeited
by such Participant pursuant to the preceding sentence shall cease to be
liabilities of the Employer or the Plan and such amounts shall be immediately
debited from the Participant’s Company Contribution Account and Company Matching
Account and credited to such Employer.
     3.6 Earnings Credits or Losses. In accordance with, and subject to, the
rules and procedures that are established from time to time by the
Administrator, in its sole discretion, amounts shall be credited or debited to a
Participant’s Account Balance in accordance with the following rules:
     (a) Election of Measurement Funds. A Participant, in connection with his or
her initial deferral election in accordance with Section 3.1 above, shall elect,
on the Election Form, one or more Measurement Fund(s) (as described in
Section 3.6(c) below) to be used to determine

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the additional amounts to be credited (or charged, as the case may be) to his or
her Account Balance, unless changed in accordance with the next sentence. The
Participant may (but is not required to) elect, by submitting an Election Form
to the Administrator that is accepted by the Administrator, to add or delete one
or more Measurement Fund(s) to be used to determine the additional amounts to be
credited (or charged, as the case may be) to his or her Account Balance, or to
change the portion of his or her Account Balance allocated to each previously or
newly elected Measurement Fund. If an election is made in accordance with the
previous sentence, it shall become effective as soon as administratively
practicable and shall continue thereafter until changed in accordance with the
previous sentence. Changes may be made to allocations at any time during the
Plan Year.
     (b) Proportionate Allocation. In making any election described in Section
3.6(a) above, the Participant shall specify on the Election Form, in increments
of whole percentage points (1%), the percentage of his or her Account Balance to
be allocated to a Measurement Fund (as if the Participant was making an
investment in that Measurement Fund with that portion of his or her Account
Balance).
     (c) Measurement Funds. The Administrator shall from time to time select
types of Measurement Funds and specific Measurement Funds for deemed investment
designation by Participants for the purpose of crediting or charging
hypothetical or deemed investment earnings and losses to his or her Account
Balance. As necessary, the Administrator may, in its sole discretion,
discontinue, substitute or add a Measurement Fund. The Administrator shall
notify the Participants of the types of Measurement Funds and the specific
Measurement Funds selected from time to time. Notwithstanding anything to the
contrary set forth herein, the Company Stock Measurement Fund is not available
for elective investment designations by Participants.
     (d) Crediting or Debiting Method. The performance of each elected
Measurement Fund (either positive or negative) will be determined by the
Administrator, in its sole discretion, based on the performance of the
Measurement Funds themselves. A Participant’s Account Balance shall be credited
or debited as frequently as is administratively feasible, but no less often than
monthly, based on the performance of each Measurement Fund selected by the
Participant, as determined by the Administrator in its sole discretion.
     (e) No Actual Investment. Notwithstanding any other provision of this Plan
that may be interpreted to the contrary, the Measurement Funds are to be used
for measurement purposes only, and a Participant’s election of any such
Measurement Fund, the allocation to his or her Account Balance thereto, the
calculation of additional amounts and the crediting or debiting of such amounts
to a Participant’s Account Balance shall not be considered or construed in any
manner as an actual investment of his or her Account Balance in any such
Measurement Fund. In the event that the Company or the Trustee (as that term is
defined in the Trust), in its own discretion, decides to invest funds in any or
all of the Measurement Funds, no Participant shall have any rights in or to such
investments themselves. Without limiting the foregoing, a Participant’s Account
Balance shall at all times be a bookkeeping entry only and shall not represent
any investment made on his or her behalf by the Employer or the Trust; the
Participant shall at all times remain an unsecured creditor of the Employers.
Any liability of an Employer to any Participant, former Participant, or
Beneficiary with respect to a right to payment shall be based solely upon
contractual obligations created by the Plan. The Company, the Board, the
Administrator, any Employer and any individual or entity shall not be deemed to
be a trustee of any amounts to be paid 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 an Employer and a Participant, former Participant,

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Beneficiary or any other individual or entity. Neither the Company nor any
Employer in any way guarantees any Participant’s Account Balance against loss or
depreciation, whether caused by poor investment performance, insolvency of a
deemed investment or by any other event or occurrence. In no event shall any
Employee, officer, Director or stockholder of the Company or any Employer be
liable to any individual or entity on account of any claim arising by reason of
the Plan provisions or any instrument or instruments implementing its
provisions, or for the failure of any Participant, Beneficiary or other
individual or entity to be entitled to any particular tax consequences with
respect to the Plan or any credit or payment hereunder.
     (f) Company Contribution Accounts. Notwithstanding any other provision of
this Plan to the contrary, Company Contribution Amounts may only be allocated to
the Measurement Funds designated by the Administrator from time to time, in its
sole discretion.
     (g) RSU Account. Notwithstanding any other provision of this Plan to the
contrary, RSU Deferral Amounts shall be automatically allocated to the Company
Stock Measurement Fund and may not be allocated to any other Measurement Fund.
     3.7 Distributions. Any distribution with respect to a Participant’s Account
Balance shall be charged to the appropriate account as of the date such payment
is made by the Employer or the trustee of the Trust which may be established for
the Plan.
ARTICLE 4
DISTRIBUTIONS
     4.1 Fixed Date Payout.
     (a) Election of Fixed Date Payout. In connection with each Election Form, a
Participant may irrevocably elect to receive a future “Fixed Date Payout” from
the Plan of his or her vested Fixed Date Payout Account Balance. Subject to the
Deduction Limitation and the other terms and conditions of this Plan, each Fixed
Date Payout elected shall be paid out no earlier than five (5) years from
January 1 of the Plan Year following the Plan Year in which the Annual Deferral
Amount is actually deferred or the Employer contribution is actually credited to
the Participant’s account, but in no event later than the date on which the
Participant reaches age seventy (70) (the “Earliest Fixed Date Payout Date”). By
way of example, if a five (5) year Fixed Date Payout is elected for Annual
Deferral Amounts that are deferred in the Plan Year commencing January 1, 2003,
the five (5) year Fixed Date Payout would become payable no earlier than
January 1, 2009. A Participant shall elect on each Election Form on which a
Fixed Date Payout is elected to receive the Fixed Date Payout Account Balance
applicable to such election in a lump sum or pursuant to an Annual Installment
Method over a period of up to fifteen (15) years. If a Participant does not
elect to have his or her Fixed Date Payout Account Balance paid in accordance
with the Annual Installment Method, then such benefit shall be payable in a lump
sum. The lump sum payment shall be made no later than sixty (60) days after the
last day of any Plan Year designated by the Participant that is after the
Earliest Fixed Date Payout Date. Any payment made shall be subject to the
Deduction Limitation. Notwithstanding anything to the contrary set forth herein,
Fixed Date Payout Account Balances that are less than $50,000 at any time on or
after the date that distributions are scheduled to commence shall be immediately
paid in a lump sum notwithstanding any Annual Installment Method payment
election provided, however, that no payment acceleration shall occur prior to
January 1, 2008 pursuant to this provision.

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     (b) Redeferrals. For Post-December 31, 2004 Deferrals, a Participant may
modify the date on which any such Fixed Date Payout is to be paid or revoke a
previous election with respect thereto by submitting a new Election Form;
provided that any such modification or revocation shall not be given any effect
until at least twelve (12) months after the date on which the new election is
made and only if (i) such new Election Form is submitted to and accepted by the
Administrator in its sole discretion at least thirteen (13) months prior to the
scheduled payout date of the distribution to be modified or revoked and (ii) any
new payout date designated in such form is at least five (5) years following the
scheduled payout date of the distribution to be deferred.
     (c) Other Benefits Take Precedence Over Fixed Date. Should an event occur
that triggers a benefit under Section 4.2, 4.3, 4.4, 4.5 or 4.6, any Fixed Date
Payout Account Balance that is subject to a Fixed Date Payout election under
Section 4.1 shall not be paid in accordance with Section 4.1 but shall be paid
in accordance with the other applicable Section.
     4.2 Retirement Benefit.
     (a) Retirement Benefit. A Participant who Retires shall receive, as a
Retirement Benefit, his or her Account Balance. A Participant, in connection
with his or her commencement of participation in the Plan, shall elect on an
Election Form to receive the Retirement Benefit in a lump sum or pursuant to an
Annual Installment Method over a period of up to fifteen (15) years. If a
Participant does not make any election with respect to the payment of the
Retirement Benefit, then such benefit shall be payable in a lump sum. The lump
sum payment shall be made, or installment payments shall commence, no later than
sixty (60) days after the date the Participant Retires. Any payment made (other
than payment of a Post-December 31, 2004 Deferral) shall be subject to the
Deduction Limitation. Notwithstanding anything to the contrary set forth herein,
Account Balances that are less than $50,000 at any time on or after the date
that distributions are scheduled to commence shall be immediately paid in a lump
sum notwithstanding any Annual Installment Method payment election; provided,
however, that no payment acceleration shall occur prior to January 1, 2008
pursuant to this provision.
     (b) Death Prior to Completion of Retirement Benefit. If a Participant dies
after Retirement but before the Retirement Benefit is paid in full, the
Participant’s unpaid Retirement Benefit payments shall be paid to the
Participant’s Beneficiary in a lump sum that is equal to the Participant’s
unpaid remaining vested Account Balance as of the date of the Participant’s
death; provided that payment of amounts that are Post-December 31, 2004
Deferrals shall continue to be made in the same manner and in the same form as
they were made to the Participant prior to his or her death. Any lump sum
payment shall be made no later than sixty (60) days after the date of the
Participant’s death. Any payment made (other than payment of a Post-December 31,
2004 Deferral) shall be subject to the Deduction Limitation
     (c) Key Employees. Notwithstanding any provision in Section 4.2(a) above,
if a Participant is a Key Employee as of the date of his or her Retirement,
solely with regard to Post-December 31, 2004 Deferrals, if any, the lump sum
payment shall be made, or installment payments shall commence, no earlier than
six (6) months after the date of the Participant’s Retirement.
     4.3 Pre-Retirement Survivor Benefit. If a Participant dies before he or she
receives complete payment of benefits pursuant to this Article 4, such
Participant’s Beneficiary shall receive a Pre-Retirement Survivor Benefit equal
to the Participant’s vested Account Balance as of the date of the Participant’s
death (after giving effect to any accelerated vesting as a result of the
Participant’s death

15.

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pursuant to Section 3.5). The Pre-Retirement Survivor Benefit shall be paid to
the Participant’s Beneficiary in a lump sum; provided that payment of amounts
that are Post-December 31, 2004 Deferrals shall continue to be made in the same
manner and in the same form as they were made to the Participant prior to his or
her death. Any lump sum payment shall be made no later than sixty (60) days
after the date of the Participant’s death. Any payment made (other than payment
of a Post-December 31, 2004 Deferral) shall be subject to the Deduction
Limitation.
     4.4 Termination Benefit.
     (a) Termination Other Than For Cause. If a Participant experiences a
Termination of Employment for any reason other than as a result of a termination
by the Company for Cause prior to his or her becoming entitled to receive
benefits by reason of any other sections of this Article 4, such Participant
shall receive a Termination Benefit, which shall be equal to the Participant’s
vested Account Balance as of the date on which he or she experiences a
Termination of Employment. A Participant, in connection with his or her
commencement of participation in the Plan, shall elect on an Election Form to
receive the Termination Benefit pursuant to this Section 4.4(a) in a lump sum or
pursuant to an Annual Installment Method over a period of up to fifteen
(15) years. If a Participant does not make any election with respect to the
payment of the Termination Benefit pursuant to this Section 4.4(a), then such
benefit shall be payable in a lump sum. The lump sum payment shall be made, or
installment payments shall commence, no later than sixty (60) days after the
date of the Participant experiences a Termination of Employment. Any payment
made (other than payment of a Post-December 31, 2004 Deferral) shall be subject
to the Deduction Limitation. Notwithstanding anything to the contrary set forth
herein, Account Balances that are less than $50,000 at any time on or after the
date that distributions are scheduled to commence shall be immediately paid in a
lump sum notwithstanding any Annual Installment Method payment election
provided, however, that no payment acceleration shall occur prior to January 1,
2008 pursuant to this provision.
     (b) Termination For Cause. If a Participant experiences a Termination of
Employment as a result of a termination by the Company for Cause prior to his or
her becoming entitled to receive benefits by reason of any other sections of
this Article 4, such Participant shall receive a Termination Benefit, which
shall be equal to the Participant’s vested Account Balance as of the date on
which he or she experiences a Termination of Employment. The Termination Benefit
pursuant to this Section 4.4(b) shall be paid in a lump sum. The lump sum
payment shall be made no later than sixty (60) days after the date of the
Participant’s Termination of Employment. Any payment made (other than payment of
a Post-December 31, 2004 Deferral) shall be subject to the Deduction Limitation.
     (c) Key Employees. Notwithstanding any other provision in this Section 4.4,
if Participant is a Key Employee as of the date of his or her Termination of
Employment, solely with regard to Post-December 31, 2004 Deferrals, if any, the
lump sum payment shall be made, or installment payments shall commence, no
earlier than six (6) months after the date of the Participant’s Termination of
Employment.
     4.5 Disability Benefit. In the event of the Participant’s Termination of
Employment as a result of his or her Disability, as determined by the
Administrator, the Participant shall receive a Disability Benefit, which shall
be equal to the Participant’s vested Account Balance as of the date on which he
or she experiences a Termination of Employment (after giving effect to any
accelerated vesting as a result of the Participant’s Disability pursuant to
Section 3.5). A Participant, in connection with his or her commencement of
participation in the Plan, shall elect on an Election Form to receive the
Disability Benefit in a lump sum or pursuant to an Annual Installment Method
over a period of up to fifteen (15)

16.

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years; provided, however, that notwithstanding a Participant’s election, other
than with respect to Post-December 31, 2004 Deferrals the Administrator may
decide, in its sole discretion, the manner in which such Disability Benefit
shall be paid. If a Participant does not make any election with respect to the
payment of the Disability Benefit, then the Participant shall be deemed to have
elected to have the Disability Benefit paid in a lump sum. The lump sum payment
shall be made, or installment payments shall commence, no later than sixty
(60) days after the date of the Participant’s Termination of Employment. Any
payment made (other than payment of a Post-December 31, 2004 Deferral) shall be
subject to the Deduction Limitation. Notwithstanding anything to the contrary
set forth herein, Account Balances that are less than $50,000 at any time on or
after the date that distributions are scheduled to commence shall be immediately
paid in a lump sum notwithstanding any Annual Installment Method payment
election provided, however, that no payment acceleration shall occur prior to
January 1, 2008 pursuant to this provision.
     4.6 Change in Control Benefit.
     (a) Change in Control Benefit. The Committee may, in its sole discretion,
determine that a Participant shall receive a Change in Control Benefit, which
shall be equal to the Participant’s vested Account Balance in the event of a
Change in Control (after giving effect to any accelerated vesting as a result of
the Participant’s Disability pursuant to Section 3.5). A Participant’s Change in
Control Benefit shall be paid in a lump sum. The lump sum payment shall be made
immediately prior to the Change in Control. Any payment made shall be subject to
the Deduction Limitation and the Excise Tax Limitation. With respect to
Post-December 31, 2004 Deferrals, any Change in Control Benefit that the
Committee determines to pay must be made within twelve (12) months after a
Change in Control and shall result in a termination of the Plan.
     (b) Change in Control Benefit to Take Precedence Over Other Benefits.
Should the Committee decide to pay a Change in Control Benefit, any Annual
Deferral Amount other than a Post-December 31, 2004 Deferral, plus amounts
credited or debited thereon, that is subject to an existing payout under
Section 4.1, 4.2, 4.3, 4.4 or 4.5 shall not be paid in accordance with such
Section but shall be paid in accordance with this Section 4.6. Payments of
Post-December 31, 2004 Deferrals shall not be accelerated as a result of this
Section 4.6 except as provided in Section 4.6(a) in connection with a
termination of the Plan.
     4.7 Form of Distributions. Distributions of the Account Balance not
including the portion of the Account Balance allocated to the Company Stock
Measurement Fund shall be paid to Participants in cash. The portion of the
Account Balance allocated to the Company Stock Measurement Fund shall be paid to
Participant’s in an equivalent number of shares of the Company’s common stock
credited to the Participant’s Account. The source of shares of Company common
stock distributed pursuant to this Plan shall be the Equity Plan. Any portion of
the Account Balance designated to be distributed in shares of Company common
stock, but which is not equal to the value of one whole share of Company common
stock shall instead be paid to the Participant in cash.
     4.8 Change In Company Shares. If any capitalization adjustment is made to
outstanding awards granted under the Company’s Equity Plan pursuant to Section
15(a) of the Company’s 2003 Incentive Stock Plan or any other similar provision
in a successor equity incentive plan, then such adjustments shall automatically
apply to the number of shares credited to the RSU Account attributable to such
awards as appropriate in order to prevent dilution or enlargement of the
benefits intended to be made available under the Plan.

17.

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ARTICLE 5
UNFORESEEABLE FINANCIAL EMERGENCIES; WITHDRAWAL ELECTION
     5.1 Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies.
If a Participant experiences an Unforeseeable Financial Emergency, the
Participant may petition the Administrator to (i) suspend any deferrals required
to be made by a Participant and/or (ii) receive a partial or full payout from
the Plan. The payout shall not exceed the lesser of the Participant’s vested
Account Balance, calculated as if such Participant were receiving a Termination
Benefit, or the amount reasonably needed to satisfy the Unforeseeable Financial
Emergency. If, subject to the sole discretion of the Administrator, the petition
for a suspension and/or payout is approved, suspension shall take effect upon
the date of approval and any payout shall be made within sixty (60) days of the
date of approval. The payment of any amount under this Section 5.1 (other than
payment of Post-December 31, 2004 Deferrals) shall be subject to the Deduction
Limitation. Once the payout is paid, the Participant shall not be eligible to
participate in the Plan for the remainder of the Plan Year during which the
payout is paid and the subsequent Plan Year.
     5.2 Withdrawal Election. A Participant (or, after a Participant’s death,
his or her Beneficiary) may elect, at any time, to withdraw all or a portion of
his or her vested Account Balance (other than any Post-December 31, 2004
Deferrals), calculated as if there had occurred a Termination of Employment as
of the day of the election, less a withdrawal penalty equal to ten percent (10%)
of such amount (the net amount shall be referred to as the “Withdrawal Amount”).
This election can be made at any time. The Participant (or his or her
Beneficiary) shall make this election by giving the Administrator advance
written notice of the election in a form determined from time to time by the
Administrator. The Participant (or his or her Beneficiary) shall be paid the
Withdrawal Amount within sixty (60) days of his or her election. Once the
Withdrawal Amount is paid, the Participant’s participation in the Plan shall
terminate and the Participant shall not be eligible to participate in the Plan
for the remainder of the Plan Year during which the Withdrawal Amount is paid
and the subsequent Plan Year. The payment of this Withdrawal Amount shall be
subject to the Deduction Limitation.
ARTICLE 6
BENEFICIARY DESIGNATION
     6.1 Beneficiary. Each Participant shall have the right, at any time, to
designate his or her Beneficiary(ies) (both primary as well as contingent) to
receive any benefits payable under the Plan to a beneficiary upon the death of a
Participant. The Beneficiary designated under this Plan may be the same as or
different from the Beneficiary designation under any other plan of an Employer
in which the Participant participates.
     6.2 Beneficiary Designation; Change. A Participant shall designate his or
her Beneficiary by completing and signing the Beneficiary Designation Form, and
returning it to the Administrator or its designated agent. A Participant shall
have the right to change a Beneficiary by completing, signing and otherwise
complying with the terms of the Beneficiary Designation Form and the
Administrator’s rules and procedures, as in effect from time to time. Upon the
acceptance by the Administrator of a new Beneficiary Designation Form, all
Beneficiary designations previously filed shall be canceled. The Administrator
shall be entitled to rely on the last Beneficiary Designation Form filed by the
Participant and accepted by the Administrator prior to his or her death.
     6.3 No Beneficiary Designation. If a Participant fails to designate a
Beneficiary as provided in Sections 6.1 and 6.2 above or, if all designated
Beneficiaries predecease the Participant or die prior to complete distribution
of the Participant’s benefits, then the Participant’s designated Beneficiary
shall be deemed to be his or her surviving spouse. If the Participant has no
surviving spouse, the benefits

18.

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remaining under the Plan to be paid to a Beneficiary shall be payable to the
executor or personal representative of the Participant’s estate.
     6.4 Doubt as to Beneficiary. If the Administrator has any doubt as to the
proper Beneficiary to receive payments pursuant to this Plan, the Administrator
shall have the right, exercisable in its discretion, to cause the Participant’s
Employer to withhold such payments until this matter is resolved to the
Administrator’s satisfaction.
     6.5 Discharge of Obligations. The payment of benefits under the Plan to a
Beneficiary shall fully and completely discharge all Employers and the
Administrator from all further obligations under this Plan with respect to the
Participant, and that Participant’s Election Form shall terminate upon such full
payment of benefits.
ARTICLE 7
LEAVE OF ABSENCE
     7.1 Paid Leave of Absence. If a Participant is authorized by the
Participant’s Employer for any reason to take a paid leave of absence from the
employment of the Employer, the Participant shall continue to be considered
employed by the Employer and the Annual Deferral Amount shall continue to be
withheld during such paid leave of absence in accordance with Section 3.4;
provided however, that this Section 7.1 shall not be effective with respect to
Post-December 31, 2004 Deferrals to the extent that such leave of absence
constitutes a “separation from service” within the meaning of Code
Section 409A(a)(2)(A)(i) and any regulations promulgated thereunder.
     7.2 Unpaid Leave of Absence; Disability Leave. If a Participant is
authorized by the Participant’s Employer for any reason to take an unpaid leave
of absence from the employment of the Employer, or if a Participant is on leave
of absence as a result of his or her Disability, the Participant shall continue
to be considered employed by the Employer and the Participant shall be excused
from making deferrals until the earlier of the date the leave of absence expires
or the Participant returns to a paid employment status. Upon such expiration or
return, deferrals shall resume for the remaining portion of the Plan Year in
which the expiration or return occurs, based on the deferral election, if any,
made for that Plan Year. If no election was made for that Plan Year, no deferral
shall be withheld. Notwithstanding the foregoing, this Section 7.2 shall not be
effective with respect to Post-December 31, 2004 Deferrals to the extent that
such leave of absence constitutes a “separation from service” within the meaning
of Code Section 409A(a)(2)(A)(i) and any regulations promulgated thereunder
ARTICLE 8
TERMINATION, AMENDMENT OR MODIFICATION
     8.1 Termination. Although each Employer anticipates that it will continue
the Plan for an indefinite period of time, there is no guarantee that any
Employer will continue the Plan or will not terminate the Plan at any time in
the future. Accordingly, each Employer reserves the right to discontinue its
sponsorship of the Plan and/or to terminate the Plan at any time with respect to
any or all of its participating Employees and Non-Employee Directors, by action
of its board of directors or similar governing body. Upon the termination of the
Plan with respect to any Employer, the participation of the affected
Participants who are employed by that Employer, or in the service of that
Employer as Directors, shall terminate and their Account Balances other than
Post-December 31, Deferrals determined as if they had experienced a Termination
of Employment on the date of Plan termination or, if Plan termination occurs
after the date upon which a Participant was eligible to Retire, then with
respect to that Participant as if he or she had Retired on the date of Plan
termination, shall, other than with respect to Post-December 31, 2004 Deferrals
be paid to the Participants in a lump sum within sixty (60) days following the
plan

19.

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termination. Upon the Plan’s termination, Post-December 31, 2004 Deferrals shall
be paid to Participants in accordance with the terms hereof in effect
immediately before such termination. The termination of the Plan shall not
adversely affect any Participant or Beneficiary who has become entitled to the
payment of any benefits under the Plan as of the date of termination; provided,
however, that other than with respect to Post-December 31, 2004 Deferrals the
Employer shall have the right to accelerate installment payments without a
premium or prepayment penalty by paying the Account Balance in a lump sum or
pursuant to an Annual Installment Method using fewer years (provided that the
present value of all payments that will have been received by a Participant at
any given point of time under the different payment schedule shall equal or
exceed the present value of all payments that would have been received at that
point in time under the original payment schedule).
     8.2 Amendment. An Employer may, at any time, amend or modify the Plan in
whole or in part with respect to that Employer by the action of its board of
directors or similar governing body; provided, however, that no amendment or
modification shall be effective to decrease or restrict the value of a
Participant’s Account Balance in existence at the time the amendment or
modification is made, calculated as if the Participant had experienced a
Termination of Employment as of the effective date of the amendment or
modification or, if the amendment or modification occurs after the date upon
which the Participant was eligible to Retire, the Participant had Retired as of
the effective date of the amendment or modification. The amendment or
modification of the Plan shall not affect any Participant or Beneficiary who has
become entitled to the payment of benefits under the Plan as of the date of the
amendment or modification; provided, however, that other than with respect to
Post-December 31, 2004 Deferrals the Employer shall have the right to accelerate
installment payments by paying the Account Balance in a lump sum or pursuant to
an Annual Installment Method using fewer years (provided that the present value
of all payments that will have been received by a Participant at any given point
of time under the different payment schedule shall equal or exceed the present
value of all payments that would have been received at that point in time under
the original payment schedule). Notwithstanding any provisions of this
Section 8.2 to the contrary, the Committee may amend the Plan at any time, in
any manner, if the Committee determines any such amendment is required to ensure
that the Plan is characterized as providing deferred compensation for a select
group of management or highly compensated employees and as described in ERISA
Sections 201(2), 301(a)(3) and 401(a)(1) or to otherwise conform the Plan to the
provisions of any applicable law, including ERISA and the Code.
     8.3 Effect of Payment. The full payment of the applicable benefit under
Article 4 of the Plan shall completely discharge all obligations to a
Participant and his or her designated Beneficiaries under this Plan.
ARTICLE 9
ADMINISTRATION
     9.1 Administrator Duties. The Committee appointed pursuant to Section 9.3
shall be the Administrator and shall conduct the general administration of the
Plan in accordance with the Plan and shall have all the necessary power and
authority to carry out that function. Members of the Administrator may be
Participants under this Plan. Any individual serving on the Administrator who is
a Participant shall not vote or act on any matter relating solely to himself or
herself. Among the Committee’s necessary powers and duties are the following:
     (a) Except to the extent provided otherwise by Article 12, to delegate all
or part of its function as Administrator to others and to revoke any such
delegation.
     (b) To determine questions of eligibility of Participants and their
entitlement to benefits, subject to the provisions of Articles 10 and 12.

20.

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     (c) To select and engage attorneys, accountants, actuaries, trustees,
appraisers, brokers, consultants, administrators, physicians or other persons to
render service or advice with regard to any responsibility the Administrator has
under the Plan, or otherwise, to designate such persons to carry out fiduciary
responsibilities (other than trustee responsibilities) under the Plan, and (with
the Committee, the Employers and their officers, Directors, trustees and
Employees) to rely upon the advice, opinions or valuations of any such persons,
to the extent permitted by law, being fully protected in acting or relying
thereon in good faith.
     (d) To interpret the Plan for purpose of the administration and application
of the Plan, in a manner not inconsistent with the Plan or applicable law and to
amend or revoke any such interpretation.
     (e) To conduct claims procedures as provided in Article 10.
     9.2 Binding Effect of Decisions. The decision or action of the
Administrator with respect to any question arising out of or in connection with
the administration, interpretation and application of the Plan and the rules and
regulations promulgated hereunder shall be final and conclusive and binding upon
all persons having any interest in the Plan.
     9.3 Committee. The Committee shall consist solely of two or more
Non-Employee Directors appointed by and holding office at the pleasure of the
Board, each of whom is both a “non-employee director” as defined by Rule 16b-3
and an “outside director” for purposes of Section 162(m) of the Code.
Appointment of Committee members shall be effective upon acceptance of
appointment. Committee members may resign at any time by delivering written
notice to the Board. Vacancies in the Committee may be filled by the Board.
     9.4 Indemnification. All Employers shall indemnify and hold harmless any of
their officers, Directors, Committee members or Employees who are involved in
the administration of the Plan against any and all claims, losses, damages,
expenses or liabilities arising out of the good faith performance of their
administrative functions.
     9.5 Employer Information. To enable the Administrator to perform its
functions, each Employer shall supply full and timely information to the
Administrator on all matters relating to the compensation of its Participants,
the date and circumstances of the Retirement, Disability, death or Termination
of Employment of its Participants, and such other pertinent information as the
Administrator may reasonably require.
ARTICLE 10
CLAIMS PROCEDURES
     10.1 Presentation of Claim. Any Participant or Beneficiary of a deceased
Participant (such Participant or Beneficiary being referred to below as a
“Claimant”) may deliver to the Administrator a written claim for a determination
with respect to the amounts distributable to such Claimant from the Plan. The
claim must state with particularity the determination desired by the Claimant.
     10.2 Notification of Decision. The Administrator shall consider a
Claimant’s claim within a reasonable time, and shall notify the Claimant in
writing:
     (a) that the Claimant’s requested determination has been made, and that the
claim has been allowed in full; or

21.

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     (b) that the Administrator has reached a conclusion contrary, in whole or
in part, to the Claimant’s requested determination, and such notice must set
forth in a manner calculated to be understood by the Claimant:

  (i)   the specific reason(s) for the denial of the claim, or any part of it;  
  (ii)   specific reference(s) to pertinent provisions of the Plan upon which
such denial was based;     (iii)   a description of any additional material or
information necessary for the Claimant to perfect the claim, and an explanation
of why such material or information is necessary; and     (iv)   an explanation
of the claim review procedure set forth in Section 9.3 below, including a
statement of the Claimant’s right to bring a civil action under Section 502(a)
of ERISA following an adverse decision on review.

          The notice of denial shall be given within a reasonable time period
but no later than ninety (90) days after the claim is filed, unless special
circumstances require an extension of time for processing the claim. If such
extension is required, written notice shall be furnished to the Claimant within
ninety (90) days of the date the claim was filed stating the special
circumstances requiring an extension of time and the date by which a decision on
the claim can be expected, which shall be no more than one hundred eighty
(180) days from the date the claim was filed.
     10.3 Review of a Denied Claim. Within sixty (60) days after receiving a
notice from the Administrator that a claim has been denied, in whole or in part,
a Claimant (or the Claimant’s duly authorized representative) may file with the
Administrator a written request for a review of the denial of the claim.
Thereafter, but not later than thirty (30) days after the review procedure
began, the Claimant (or the Claimant’s duly authorized representative):
     (a) may review and/or copy, free of charge, pertinent documents, records
and other information relevant to the Claimant’s claim;
     (b) may submit issues, written comments or other documents, records and
information relating to the claim; and/or
     (c) may request a hearing, which the Administrator, in its sole discretion,
may grant.
     10.4 Decision on Review. The Administrator shall render its decision on
review promptly, and not later than sixty (60) days after the filing of a
written request for review of the denial, unless a hearing is held or other
special circumstances require additional time, in which case the Administrator’s
decision must be rendered within one hundred twenty (120) days after such date.
Such decision must be written in a manner calculated to be understood by the
Claimant, and it must contain:
     (a) specific reasons for the decision;
     (b) specific reference(s) to the pertinent Plan provisions upon which the
decision was based;

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     (c) a statement that the Claimant is entitled to receive upon request and
free of charge reasonable access to and copies of all documents, records and
other information relevant to the Claimant’s claim for benefits;
     (d) a statement of the Claimant’s right to bring a civil action under
Section 502(a) of ERISA following an adverse decision on review; and
     (e) such other matters as the Administrator deems relevant.
     10.5 Designation. The Administrator may designate any other person of its
choosing to make any determination otherwise required under this Article 10.
     10.6 Arbitration.
     (a) A Claimant whose appeal has been denied under Section 10.4 shall have
the right to submit said claim to final and binding arbitration before a single
arbitrator in San Diego, California, pursuant to the rules of the American
Arbitration Association. Any such requests for arbitration must be filed by
written demand to the American Arbitration Association within sixty (60) days
after receipt of the decision regarding the appeal. The arbitrator’s decision
shall be final and binding upon the parties, and may be entered and enforced in
any court of competent jurisdiction by either of the parties; provided, however,
that the arbitrator shall not have any power to alter, amend, modify or change
any of the terms of this Plan nor to grant any remedy which is either prohibited
by the terms of this Plan or not available in a court of law. The arbitrator
shall have the power to grant temporary, preliminary and permanent relief,
including without limitation, injunctive relief and specific performance.
     (b) The Company will pay the direct costs and expenses of the arbitration.
The Claimant and the Company are responsible for their respective attorneys’
fees incurred in connection with the arbitration; however, to the extent
permitted by law, the arbitrator may, in his or her discretion, award reasonable
attorneys’ fees to the prevailing party.
ARTICLE 11
TRUST
     11.1 Establishment of the Trust. The Company shall establish the Trust. All
benefits payable under this Plan to a Participant shall be paid directly by the
Employer(s) from the Trust. To the extent that such benefits are not paid from
the Trust, the benefits shall be paid from the general assets of the
Employer(s). The Trust, if any, shall be an irrevocable grantor trust which
conforms to the terms of the model trust as described in IRS Revenue Procedure
92 64, I.R.B. 1992 33. The assets of the Trust are subject to the claims of each
Employer’s creditors in the event of its insolvency. Except as provided under
the Trust agreement, neither the Company nor an Employer shall be obligated to
set aside, earmark or escrow any funds or other assets to satisfy its
obligations under this Plan, and the Participant and/or his or her designated
Beneficiaries shall not have any property interest in any specific assets of the
Company or an Employer other than the unsecured right to receive payments from
the Employer, as provided in this Plan.
     11.2 Interrelationship of the Plan and the Trust. The provisions of the
Plan shall govern the rights of a Participant to receive distributions pursuant
to the Plan. The provisions of the Trust shall govern the rights of the
Employers, Participants and the creditors of the Employers to the assets
transferred to the Trust. Each Employer shall at all times remain liable to
carry out its obligations under the Plan.

23.

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     11.3 Investment of Trust Assets. The Trustee of the Trust shall be
authorized, upon written instructions received from the Administrator or
investment manager appointed by the Administrator, to invest and reinvest the
assets of the Trust in accordance with the applicable Trust Agreement, including
the disposition of Stock and reinvestment of the proceeds in one or more
investment vehicles designated by the Administrator.
     11.4 Distributions From the Trust. Each Employer’s obligations under the
Plan may be satisfied with Trust assets distributed pursuant to the terms of the
Trust, and any such distribution shall reduce the Employer’s obligations under
this Plan.
ARTICLE 12
PROVISIONS RELATING TO SECURITIES LAWS
     12.1 Designation of Participants. With respect to any Employee or
Non-Employee Director who is then subject to Section 16 of the Exchange Act,
only the Committee may designate such Employee or Non-Employee Director as a
Participant in the Plan.
     12.2 Action by Committee. With respect to any Participant who is then
subject to Section 16 of the Exchange Act, any function of the Administrator
under the Plan relating to such Participant shall be performed solely by the
Committee, if and to the extent required to ensure the availability of an
exemption under Section 16 of the Exchange Act for any transaction relating to
such Participant under the Plan.
     12.3 Compliance with Section 16. Notwithstanding any other provision of the
Plan or any rule, instruction, election form or other form, the Plan and any
such rule, instruction or form shall be subject to any additional conditions or
limitations set forth in any applicable exemptive rule under Section 16 of the
Exchange Act (including any amendment to Rule 16b 3) that are requirements for
the application of such exemptive rule. To the extent permitted by applicable
law, such provision, rule, instruction or form shall be deemed amended to the
extent necessary to conform to such applicable exemptive rule.
ARTICLE 13
MISCELLANEOUS
     13.1 Status of Plan. The Plan is intended to be a plan that is not
qualified within the meaning of Code Section 401(a) and that “is unfunded and is
maintained by an employer primarily for the purpose of providing deferred
compensation for a select group of management or highly compensated employees”
within the meaning of ERISA Sections 201(2), 301(a)(3) and 401(a)(1). The Plan
shall be administered and interpreted to the extent possible in a manner
consistent with that intent.
     13.2 Unsecured General Creditor. Participants and their Beneficiaries,
heirs, successors and assigns shall have no legal or equitable rights, interests
or claims in any property or assets of any Employer. For purposes of the payment
of benefits under this Plan, any and all of an Employer’s assets shall be, and
remain, the general, unpledged unrestricted assets of the Employer. An
Employer’s obligation under the Plan shall be merely that of an unfunded and
unsecured promise to pay money in the future.
     13.3 Employer’s Liability. An Employer’s liability for the payment of
benefits shall be defined only by the Plan and the Election Form(s), as entered
into between the Employer and a Participant. An Employer shall have no
obligation to a Participant under the Plan except as expressly provided in the
Plan and his or her Election Form(s).

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     13.4 Nonassignability. Neither a Participant nor any other person shall
have any right to commute, sell, assign, transfer, pledge, anticipate, mortgage
or otherwise encumber, transfer, hypothecate, alienate or convey in advance of
actual receipt, the amounts, if any, payable hereunder, or any part thereof,
which are, and all rights to which are expressly declared to be, unassignable
and non-transferable. No part of the amounts payable shall, prior to actual
payment, be subject to seizure, attachment, garnishment or sequestration for the
payment of any debts, judgments, alimony or separate maintenance owed by a
Participant or any other person, be transferable by operation of law in the
event of a Participant’s or any other person’s bankruptcy or insolvency or be
transferable to a spouse as a result of a property settlement or otherwise. The
benefits which a Participant may accrue under this Plan are not subject to the
terms of any Qualified Domestic Relations Order (as that term is defined in
Section 414(p) of the Code) with respect to any Participant, and the
Administrator, the Board, the Committee, the Company and any Employer shall not
be required to comply with the terms of such order in connection with this Plan.
Notwithstanding the foregoing, the withholding of taxes from Plan payments, the
recovery of Plan overpayments of benefits made to a Participant or Beneficiary,
the transfer of Plan benefit rights from the Plan to another plan, or the direct
deposit of Plan payments to an account in a financial institution (if not
actually a part of an arrangement constituting an assignment or alienation)
shall not be construed as an assignment or alienation under this Section 13.4
and shall be permitted under the Plan.
     13.5 Tax Withholding.
     (a) Annual Deferral Amounts. For each Plan Year in which an Annual Deferral
Amount is being withheld from a Participant, the Participant’s Employer(s) shall
be entitled to require payment by the Participant of any sums required by
federal, state or local tax law to be withheld with respect to the deferral, in
amounts and in a manner to be determined in the sole discretion of the
Employer(s).
     (b) RSU Deferral Amounts. When an Employee Participant becomes vested in a
portion of his or her RSU Award, the Participant’s Employer(s) shall be entitled
to require payment by the Participant of the Participant’s share of FICA and
other employment taxes, and any other sums required by federal, state or local
tax law to be withheld with respect to such vesting, in amounts and in a manner
to be determined in the sole discretion of the Employer(s).
     (c) Company Matching Amounts and Company Contribution Amounts. When a
Participant becomes vested in a portion of his or her Company Matching Account
and/or Company Contribution Account, the Participant’s Employer(s) shall be
entitled to require payment by the Participant of any sums required by federal,
state or local tax law to be withheld with respect to such vesting, in amounts
and in a manner to be determined in the sole discretion of the Employer(s).
     (d) Distributions. The Participant’s Employer(s), or the trustee of the
Trust, shall withhold from any payments made to a Participant under this Plan
all federal, state and local income, employment and other taxes required to be
withheld by the Employer(s), or the trustee of the Trust, in connection with
such payments, in amounts and in a manner to be determined in the sole
discretion of the Employer(s) and the trustee of the Trust.
     (e) Satisfaction of Tax Obligations. The Administrator, in its sole
discretion, may allow a Participant to pay to his or her Employer(s) any amounts
required to be withheld by the Employer(s) in connection with the Plan in cash,
by deduction of such amounts from other compensation payable to the Participant,
or to have such amounts withheld from his or her deferrals, vested Account
Balance or distributions.

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     13.6 Coordination with Other Benefits. The benefits provided for a
Participant and Participant’s Beneficiary under the Plan are in addition to any
other benefits available to such Participant under any other plan or program for
Employees of the Participant’s Employer(s). The Plan shall supplement and shall
not supersede, modify or amend any other such plan or program except as may
otherwise be expressly provided.
     13.7 Compliance. A Participant shall have no right to receive payment with
respect to the Participant’s Account Balance until all legal and contractual
obligations of the Employer(s) relating to establishment of the Plan and the
making of such payments shall have been complied with in full.
     13.8 Not a Contract of Employment. The terms and conditions of this Plan
shall not be deemed to constitute a contract of employment between any Employer
and the Participant. Such employment is hereby acknowledged to be an “at will”
employment relationship that can be terminated at any time for any reason, or no
reason, with or without cause, and with or without notice, unless expressly
provided in a written employment agreement. Nothing in this Plan shall be deemed
to give a Participant the right to be retained in the service of any Employer,
either as an Employee or a Director, or to interfere with the right of any
Employer to discipline or discharge the Participant at any time.
     13.9 Furnishing Information. A Participant or his or her Beneficiary will
cooperate with the Administrator by furnishing any and all information requested
by the Administrator and take such other actions as may be requested in order to
facilitate the administration of the Plan and the payments of benefits
hereunder, including but not limited to taking such physical examinations as the
Administrator may deem necessary.
     13.10 Governing Law. Subject to ERISA, the provisions of this Plan shall be
construed and interpreted according to the internal laws of the State of
California without regard to its conflicts of laws principles.
     13.11 Notice. Any notice or filing required or permitted to be given to the
Administrator under this Plan shall be sufficient if in writing and
hand-delivered, or sent by registered or certified mail, to the address below:
Chief Financial Officer
Neurocrine Biosciences, Inc.
12790 El Camino Real
San Diego, CA 92130
with a copy to:
Secretary
Neurocrine Biosciences, Inc.
12790 El Camino Real
San Diego, CA 92130
          Such notice shall be deemed given as of the date of delivery or, if
delivery is made by mail, as of the date shown on the postmark on the receipt
for registration or certification.
          Any notice or filing required or permitted to be given to a
Participant under this Plan shall be sufficient if in writing and
hand-delivered, or sent by mail, to the last known address of the Participant.

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     13.12 Successors. The provisions of this Plan shall bind and inure to the
benefit of the Participant’s Employer and its successors and assigns and the
Participant and the Participant’s designated Beneficiaries.
     13.13 Spouse’s Interest. The interest in the benefits hereunder of a spouse
of a Participant who has predeceased the Participant shall automatically pass to
the Participant and shall not be transferable by such spouse in any manner,
including but not limited to such spouse’s will, nor shall such interest pass
under the laws of intestate succession.
     13.14 Validity. In case any provision of this Plan shall be illegal or
invalid for any reason, said illegality or invalidity shall not affect the
remaining parts hereof, but this Plan shall be construed and enforced as if such
illegal or invalid provision had never been inserted herein.
     13.15 Incompetent. If the Administrator determines in its discretion that a
benefit under this Plan is to be paid to a minor, a person declared incompetent
or to a person incapable of handling the disposition of that person’s property,
the Administrator may direct payment of such benefit to the guardian, legal
representative or person having the care and custody of such minor, incompetent
or incapable person. The Administrator may require proof of minority,
incompetence, incapacity or guardianship, as it may deem appropriate prior to
distribution of the benefit. Any payment of a benefit shall be a payment for the
account of the Participant and the Participant’s Beneficiary, as the case may
be, and shall be a complete discharge of any liability under the Plan for such
payment amount.
     13.16 Court Order. The Administrator is authorized to make any payments
directed by court order in any action in which the Plan or the Administrator has
been named as a party. In addition, if a court determines that a spouse or
former spouse of a Participant has an interest in the Participant’s benefits
under the Plan in connection with a property settlement or otherwise, the
Administrator, in its sole discretion, shall have the right, notwithstanding any
election made by a Participant, to immediately distribute the spouse’s or former
spouse’s interest in the Participant’s benefits under the Plan to that spouse or
former spouse.
     13.17 Distribution in the Event of Taxation.
     (a) In General. If, for any reason, all or any portion of a Participant’s
benefits under this Plan becomes taxable to the Participant prior to receipt, a
Participant may petition the Administrator for a distribution of that portion of
his or her benefit that has become taxable. Upon the grant of such a petition,
which grant shall not be unreasonably withheld, a Participant’s Employer shall
distribute to the Participant immediately available funds in an amount equal to
the Federal Insurance Contributions Act (“FICA”) tax imposed under Code
Sections 3101 and 3121(v)(2) on amounts deferred under the Plan (the “FICA
Amount”) as well as income tax at source on wages imposed under Code
Section 3041 with respect to his or her benefit, as well as the additional
income tax at source on wages attributable to the pyramiding Code Section 3401
wages and taxes (which aggregate amounts shall not exceed the lesser of a
Participant’s unpaid Account Balance under the Plan or the aggregate amount of
the FICA Amount and the income tax withholding related to such FICA Amount). If
the petition is granted, the tax liability distribution shall be made within
ninety (90) days of the date when the Participant’s petition is granted. Such a
distribution shall affect and reduce the benefits to be paid under this Plan.
     (b) Trust. If the Trust terminates in accordance with the provisions of the
Trust and benefits are distributed from the Trust to a Participant in accordance
with such provisions, the Participant’s benefits under this Plan shall be
reduced to the extent of such distributions

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     13.18 Insurance. The Employers, on their own behalf or on behalf of the
trustee of the Trust, and, in their sole discretion, may apply for and procure
insurance on the life of the Participant, in such amounts and in such forms as
the Trust may choose. The Employers or the trustee of the Trust, as the case may
be, shall be the sole owner and beneficiary of any such insurance. The
Participant shall have no interest whatsoever in any such policy or policies,
and at the request of the Employers shall submit to medical examinations and
supply such information and execute such documents as may be required by the
insurance company or companies to whom the Employers have applied for insurance.
     13.19 409A Compliance. In the event any provision of this Plan, or the
application thereof, is or becomes inconsistent with Code Section 409A and any
regulations promulgated thereunder, such provision shall be void or
unenforceable or in the sole discretion of the Committee shall be deemed amended
to comply with Code Section 409A and any regulations promulgated thereunder. The
other provisions of this Plan shall remain in full force and effect.

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     IN WITNESS WHEREOF, the Company has signed this amended and restated Plan
document as of August 1, 2007.

                  Neurocrine Biosciences, Inc., a Delaware corporation    
 
           
 
  By:   /s/ Timothy P. Coughlin    
 
                Title: Vice President and Chief Financial Officer    

29.