Exhibit 4.3


MAGNETEK, INC.


 


AMENDED AND RESTATED DIRECTOR AND OFFICER COMPENSATION

AND DEFERRAL INVESTMENT PLAN


 


Article 1.


1.1     Establishment. 
Magnetek, Inc., a Delaware corporation (the “Company”), established,
effective as of October 21, 1997, an amended and restated director pay and
deferred compensation plan, which shall be known as the “Magnetek, Inc. Amended
and Restated Director and Officer Compensation and Deferral Investment Plan”
(the “Plan”), for members of the Board of Directors who are not employees or
officers of the Company.  The Plan is
hereby amended and restated effective as of January 1, 2005 (the “2005
Restatement”), which amendment and restatement is intended as good faith
compliance with Section 409A of the Code (as defined below) and the regulations
and other Treasury Department guidance promulgated thereunder (“Section 409A”).  The 2005 Restatement shall only apply to (i) “amounts
deferred” (within the meaning of Section 409A) by Directors (as defined below)
in taxable years beginning both before and after December 31, 2004, and any
earnings thereon and (ii) all amounts deferred by Key Executives (as defined
below) under the Plan and any earnings thereon (collectively, “Section 409A
Deferrals”).  The provisions of the Plan
in existence prior to the 2005 Restatement shall continue to govern “amounts
deferred” (within the meaning of Section 409A) by Directors in taxable years
beginning before January 1, 2005, and any earnings thereon (collectively, “Grandfathered
Deferrals”).  In addition, this amendment
and restatement of the Plan extends participation in the Plan, with respect to
compensation earned on or after January 1, 2006, to certain Key Executives of
the Company.  From and after January 1, 2006,
the Plan shall be comprised of two 
separate sub-plans, one for the benefit of Directors (the “Director Plan”)
and one for the benefit of Key Executives (the “Key Executive Plan”).  The Key Executive Plan is a nonqualified
deferred compensation plan which is unfunded and is maintained primarily for
the purpose of providing deferred compensation for a select group of management
or highly compensated employees, within the meaning of Sections 201(2),
301(a)(3) and 401(a)(1) of ERISA, as defined below.  The Director Plan is not subject to ERISA.  This document is also intended to constitute
the Summary Plan Description for the Plan.


1.2     Purpose. 
The primary purposes of the Plan are (i) to provide Directors with the
opportunity to defer voluntarily a portion of their Director’s Fees (as defined
below), subject to the terms of the Plan, (ii) to provide certain Key
Executives with the opportunity to defer voluntarily a portion of their
Compensation (as defined below), subject to the terms of the Plan and (iii) to
encourage ownership of common stock by Directors and Key Executives and thereby
align their interests more closely with the interests of the stockholders of
the Company.  By adopting the Plan, the
Company desires to enhance its ability to attract and retain Directors and Key
Executives of outstanding competence.


 


 

















 


Article 2.       Definitions.


Whenever used herein, the following terms shall have the meanings set
forth below, and, when the defined meaning is intended, the term is
capitalized:


(a)         “Board”
or “Board of Directors” means the Board of Directors of the Company.


(b)        “Board
Meeting” means any meeting of the Board of Directors or of any committee
thereof on which the Director serves and for which the Director is entitled to
receive Meeting Fees.


(c)         “Bonus”
means an incentive award payable by the Company to a Key Executive with respect
to the Key Executive’s services under the Magnetek Incentive Compensation Plan,
or such other bonus or incentive compensation plan or program of the Company,
and, in each case, shall be deemed earned only upon award by the Company.


(d)        “Code”
means the Internal Revenue Code of 1986, as amended from time to time.


(e)         “Committee”
means the Compensation Committee of the Board or such other committee of two
(2) or more Directors appointed by the Committee to administer the Plan
pursuant to Article 3.


(f)         “Company”
means Magnetek, Inc., a Delaware corporation.


(g)        “Compensation”
means an Employee’s gross Salary and Bonus.


(h)        “Director”
means a member of the Board of Directors of the Company who is neither an employee
nor an officer of the Company.


(i)          “Director’s
Fees” means a Director’s Retainer Fees and Meeting Fees, whether payable in
cash or stock or any combination thereof.


(j)          “Disability”
means that a Participant has become “disabled” as such term is defined under
Section 409A.


(k)         “ERISA”
means the Employee Retirement Income Security Act of 1974, as amended from time
to time.


(l)          “Fair
Market Value” means (i) the mean between the highest and lowest sales prices of
a share of the Company’s stock on the principal exchange on which shares of the
Company’s stock are then trading, if any, on such determination date, or, if
shares were not traded on such date, then on the next preceding trading day
during which a sale occurred, as such prices are quoted in The Wall Street
Journal ; or (ii) if such stock is not traded on an exchange but is quoted on
NASDAQ or a successor quotation system, (1) the mean between the highest and
lowest sales prices (if the stock is then listed as a National Market Issue
under the NASD National Market System) or (2) the mean between the closing
representative bid and asked prices (in all other cases) for the stock on such
determination date as reported by NASDAQ or such


 


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successor quotation system; or (iii) if such stock is
not publicly traded on an exchange and not quoted on NASDAQ or a successor
quotation system, the mean between the closing bid and asked prices for the
stock, on such determination date, as determined in good faith by the Board; or
(iv)  if the Company’s stock is not
publicly traded, the fair market value established by the Board in good faith.


(m)        “Key
Executive” means any non-union, full-time, salaried employee of the Company who
is an officer or other key executive of the Company and who qualifies as a “highly
compensated employee or management employee” within the meaning of Title I of
ERISA.


(n)        “Meeting
Fees” means the fees paid to a Director on a per meeting basis for attending a
meeting of the Board of Directors or a committee thereof.


(o)        “Participant”
means a Director or Key Executive who is actively participating in the Plan.


(p)        “Plan”
means this Magnetek, Inc. Amended and Restated Director and Officer
Compensation and Deferral Investment Plan, as it may be amended from time to
time.


(q)        “Retainer
Fees” means annual retainer fees paid to a Director for serving as a member of
the Board of Directors or as a Chairman of a committee thereof for a full year’s
service on the Board or such lesser amount as may be payable to any Director in
respect of services on the Board of less than a full year.


(r)         “Salary”
means all regular, basic wages, before reduction for amounts deferred pursuant
to the Plan or any other plan of the Company, payable in cash to a Key
Executive for services to be rendered during the Year, exclusive of any Bonus,
other special fees, awards, or incentive compensation, allowances, or amounts
designated by the Company as payment toward or reimbursement of expenses.


(s)         “Specified
Employee” means any Participant who is a “specified employee” (as such term is
defined under Section 409A) of the Company. 
The “identification date” (as defined under Section 409A) for purposes
of identifying Specified Employees shall be September 30 of each calendar
year.  Individuals identified on any
identification date shall be Specified Employees as of January 1 of the
calendar year following the year of the identification date.  In determining whether or not an individual
is a Specified Employee as of an identification date, all individuals who are
nonresident aliens during the entire 12-month period ending on such
identification date shall be excluded for purposes of determining which
individuals will be Specified Employees.


(t)         “Stock”
means common stock of the Company, par value $0.01 per share.


(u)        “Value”
means the fair market value of the cash and/or Stock a Director receives (or,
absent deferrals hereunder, is entitled to receive) as Director’s Fees.


(v)        “Year”
means a calendar year.


 


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Article 3.         Administration


3.1     Authority
of the Committee.  The Plan shall be administered by the
Compensation Committee of the Board of Directors of the Company.  In addition, any power of the Committee
hereunder may also be exercised by the full Board, except to the extent that
the grant or exercise of such authority would cause any Stock issued hereunder
or other transaction with respect to the Plan to become subject to (or lose an
exemption under) the short-swing profit recovery provisions of Section 16 of
the Securities Exchange Act of 1934, as amended.  Subject to the terms of this Plan, the Board
may appoint a successor Committee to administer the Plan, provided that such
Committee consists solely of two (2) or more non-employee directors within the
meaning of Section 16(b) of the Securities Exchange Act of 1934.  In addition, subject to the terms of the
Plan, and to the extent permissible under Section 16 of the Securities Exchange
Act of 1934, as amended, the Board or the Committee may delegate ministerial
duties to any executive or executives of the Company.


Subject to the provisions herein, the Committee shall have full power
and discretion to issue Stock to Participants in accordance with the terms of
the Plan; to select Key Executives for participation in the Plan; to determine
the terms and conditions of each Director’s or Key Executive’s participation in
the Plan; to construe and interpret the Plan and any agreement or instrument
entered into under the Plan; to establish, amend, or waive rules and
regulations for the Plan’s administration; to amend (subject to the provisions
of Article 11 herein) the terms and conditions of the Plan and any agreement
entered into under the Plan; and to make other determinations which may be necessary
or advisable for the administration of the Plan.


3.2     Decisions
Binding.  All determinations and decisions of the Board
and/or the Committee as to any disputed question arising under the Plan,
including questions of construction and interpretation, shall be final,
conclusive, and binding on all parties and shall be given the maximum possible
deference allowed by law.


3.3     Claims
Procedure.


(a)      Director
Claims.  Any Director making a claim for benefits
under this Plan may contest the Committee’s decision to deny such claim or
appeal therefrom only by submitting the matter to binding arbitration before a
single arbitrator.  Any arbitration shall
be held in Los Angeles, California, unless otherwise agreed to by the Committee.  The arbitration shall be conducted pursuant
to the Commercial Arbitration Rules of the American Arbitration
Association.  The arbitrator’s authority
shall be limited to the affirmation or reversal of the Committee’s denial of
the claim or appeal, and the arbitrator shall have no power to alter, add to,
or subtract from any provision of this Plan. 
The arbitrator’s decision shall be final and binding on all parties, if
warranted on the record and reasonably based on applicable law and the
provisions of this Plan.  The arbitrator
shall have no power to award any punitive, exemplary, consequential, or special
damages, and under no circumstances shall an award contain any amount that in
any way reflects any of such types of damages. 
Each party shall bear its own attorney’s fees and costs of
arbitration.  Judgment on the award
rendered by the arbitrator may be entered in any court having jurisdiction
thereof.


 


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(b)      Key
Executive Claims.


(1)                          Any Participant who is a Key Executive
has the right to make a written claim for benefits under the Plan.  If such a written claim is made, and the
Committee wholly or partially denies the claim, the Committee shall provide the
claimant with written notice of such denial, setting forth, in a manner
calculated to be understood by the claimant:


(i)       the specific reason or reasons for such
denial;


(ii)      specific reference to pertinent Plan
provisions on which the denial is 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 Plan’s claims review
procedure and time limits applicable to those procedures, including a statement
of the claimant’s right to bring a civil action under ERISA Section 502(a) if
the claim is denied on appeal.


(2)                          The written  notice of any claim denial pursuant to
Section 3.3(b) shall be given not later than thirty (30) days after receipt of
the claim by the Committee, unless the Committee determines that special
circumstances require an extension of time for processing the claim, in which
event:


(i)       written notice of the extension shall be
given by the Committee to the claimant prior to thirty (30) days after receipt
of the claim;


(ii)      the extension shall not exceed a period of
thirty (30) days from the end of the initial thirty (30) day period for giving
notice of a claim denial; and


(iii)     the extension notice shall indicate (A) the
special circumstances requiring an extension of time and (B) the date by which
the Committee expects to render the benefit determination.


(3)                          The decision of the Committee shall be
final unless the claimant, within sixty (60) days after receipt of notice of
the claims denial from the Committee, submits a written request to the
Committee for an appeal of the denial. 
During that sixty (60) day period, the claimant shall be provided, upon
request and free of charge, reasonable access to, and copies of, all documents,
records and other information relevant 
to the claim for benefits.  The
claimant shall be provided the opportunity to submit written comments,
documents, records, and other information relating to the claim for benefits as
part of the claimant’s appeal.  The
claimant may act in these matters individually, or through his or her
authorized representative.


 


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(4)                          After receiving the written appeal, if
the Committee, or its delegate, shall issue a written decision notifying the
claimant of its decision on review, not later than thirty (30) days after
receipt of the written appeal, unless the Committee determines that special
circumstances require an extension of time for reviewing the appeal, in which
event:


(i)       written notice of the extension shall be
given by the Committee prior to thirty (30) days after receipt of the written
appeal;


(ii)      the extension shall not exceed a period of
thirty (30) days from the end of the initial thirty (30) day review period;


(iii)     the extension notice shall indicate (A) the
special circumstances requiring an extension of time and (B) the date by which
the Committee expects to render the appeal decision.


(5)                          The period of time within which a benefit
determination on review is required to be made shall begin at the time an appeal
is received by the Committee, without regard to whether all the information
necessary to make a benefit determination on review accompanies the filing of
the appeal.  If the period of time for
reviewing the appeal is extended as permitted above, due to a claimant’s
failure to submit information necessary to decide the claim on appeal, then the
period for making the benefit determination on review shall be tolled from the
date on which the notification of the extension is sent to the claimant until
the date on which the claimant responds to the request for additional
information.


(6)         In conducting the review on appeal, the
Committee shall take into account all comments, documents, records, and other
information submitted by the claimant relating to the claim, without regard to
whether such information was submitted or considered in the initial benefit
determination.  If the Committee upholds
the denial, the written notice of decision from the Committee shall set forth,
in a manner calculated to be understood by the claimant:


(i)                     the specific reason or reasons for the denial


(ii)      specific reference to pertinent Plan
provisions on which the denial is based;


(iii)     a statement that the claimant is entitled
to be receive, upon request and free of charge, reasonable access to , and
copies of, all documents, records and other information relevant  to the claim for benefits; and


(iv)     a statement of the claimant’s right to
bring a civil action under ERISA 502(a).


(7)                          If the Plan or any of its representatives
fail to follow any of the above claims procedures, the claimant shall be deemed
to have duly exhausted the


 


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                                        administrative remedies available under
the plan and shall be entitled to pursue any available remedies under ERISA
Section 502(a), including but not limited to the filing of an action for
immediate declaratory relief regarding benefits due under the Plan.


(c)      The
Secretary of the Company is hereby designated as agent of the Plan for the
service of legal process.


3.4     Indemnification. 
Each person who is or shall have been a member of the Board shall be
indemnified and held harmless by the Company against and from any loss, cost,
liability, or expense that may be imposed upon or reasonably incurred by him or
her in connection with or resulting from any claim, action, suit, or proceeding
to which he or she may be a defendant, or in which he or she may be a party by
reason of any act or omission by such Board member in his or her capacity as an
administrator of the Plan, and against and from any and all amounts paid by him
or her in settlement thereof, with the Company’s approval, or paid by him or
her in satisfaction of any judgment in any such action, suit, or proceeding
against him or her, provided he or she shall give the Company an opportunity,
at its own expense, to handle and defend the same before he or she undertakes
to handle and defend it on his or her own behalf.


The foregoing right of indemnification shall not be exclusive of any
other rights of indemnification to which such persons may be entitled under the
Company’s Certificate of Incorporation or Bylaws, as a matter of law, or
otherwise, or any power that the Company may have to indemnify them or hold
them harmless.


Article 4.         Participation


4.1     Participation. 
Those members of the Board of Directors who are not employees or
officers of the Company, and those Key Executives who has been designated as
eligible to participate in the Plan with respect to any Year beginning after
December 31, 2005 by the Committee shall participate in the Plan.  Notwithstanding anything herein to the
contrary, unless the Committee determines otherwise, the Company’s Chief
Executive Officer shall be eligible to participate in the Plan with respect to
any Year beginning after December 31, 2005.


In the event a Participant no longer meets the requirements for
participation in the Plan, such Participant shall become an inactive
Participant, retaining all the rights described under the Plan, except the
right to make any further deferrals or, if applicable, receive payment of
Directors’ Fees in Stock, until such time that the Participant again becomes an
active Participant.


4.2     Participation. 
Participation in the Plan by Key Executives shall be determined by
resolution of the Committee annually or at such other time selected by the
Committee.


4.3     Partial
Year Participation.  In the event that a Director or Key Executive
first becomes a Participant during a Year, such Participant shall be notified
by the Company of his or her participation, and the Company shall provide each
such Participant with “Election to Defer Forms,” which must be completed by the
Participant as provided in Sections 6.2 and 6.3 herein and “Election to Receive
Stock Forms,” which must be completed by the Participant as provided


 


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in Sections 5.2 and 5.3 herein; provided, however,
that such Participant may only make an election to defer with respect to that
portion of his or her Director’s Fees or Compensation, as applicable, for such
Year which are to be earned after the filing of the election and such
Participant may only make an election to receive payment of Meeting Fees in
stock with respect to that portion of his or her Meeting Fees for such year
which are to be earned after the filing of the election.


Article 5.         Stock in Lieu of Cash Director’s Fees


5.1     Payment
in Stock.  Subject to Section 5.5 herein, a Director
shall receive Stock in lieu of the annual cash Retainer Fees otherwise payable
to each Director each year for so long as this Plan is in effect, to the extent
and subject to the terms and conditions set forth in this Article 5.  In addition, a Director may elect to receive
Stock in lieu of cash Meeting Fees payable to such Director each year for so
long as this Plan is in effect, to the extent and subject to the terms and
conditions set forth in this Article 5.


5.2     Stock
Payment Procedures.  The number of shares of Stock to be paid in
lieu of cash Retainer Fees or cash Meeting Fees (in the event of an election by
a Director to so receive Stock in lieu of cash Meeting Fees) on each payment
date shall be equal to (i) the amount of the cash Retainer Fees or cash Meeting
Fees, as applicable, payable to each Director at the rates then in effect
divided by (ii) the Fair Market Value of Stock as determined on the most recent
practicable date preceding the payment date. 
No fractional shares of Stock shall be granted; instead, the cash
remainder shall be paid to the Participant. 
The Company shall deliver to each Participant each month as payment of
Retainer Fees one or more certificates representing the Stock, registered in
the name of the Participant (or if directed by the Participant, in the joint
names of the Participant and his or her spouse).  The Company shall deliver to each Participant
who has filed an “Election to Receive Stock Form” as payment of Meeting Fees
one or more certificates representing the Stock, registered in the name of the
Participant (or, if directed by the Participant, in joint names of the
Participant and his or her spouse) at the times such Meeting Fees are
customarily paid by the Company.


5.3     Method
of Electing to Receive Stock in Lieu of Cash Meeting Fees. 
In order to receive Stock in lieu of cash Meeting Fees under the Plan,
the Director must complete and deliver to the Company a written “Election To
Receive Stock Form” on which he or she designates the election to receive
Stock.  Participants shall make their
elections to receive payment in Stock for their Meeting Fees under the Plan no
later than the date immediately prior to the date of the Board Meeting to which
such Meeting Fees relate.  All elections
to receive payment in Stock for Meeting Fees shall be made on an “Election to
Receive Stock Form,” as described herein and shall be delivered by the
Participant to the Committee (or its delegate) as described in Section 12.1
herein.  The election to receive payment
in Stock for Meeting Fees shall automatically remain in effect for all periods
the Participant participates in the Plan until revoked or changed by the
Participant.


The election may be revoked or changed with respect to future Board
Meetings by filing with the Committee (or its delegate) a new election on an “Election
to Receive Stock Form” no


 


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later than the day immediately prior to the date of
the next Board Meeting for which the Participant shall receive Meeting Fees.


5.4     Rights
of the Participant.  Except for the terms and conditions set forth
in this Plan, a Participant paid Stock in lieu of the cash Retainer Fees or
cash Meeting Fees shall have all of the rights of a holder of the Stock,
including the right to receive dividends paid on such Stock and the right to
vote the Stock at meetings of stockholders of the Company.  Upon delivery, such Stock will be
nonforfeitable.


5.5     Special
Circumstances.  The Committee shall have the authority, in
its sole discretion, to permit all of a Director’s Retainer Fees to be paid in
cash, rather than in Stock, in the event that a Director establishes, to the
satisfaction of the Committee, that special circumstances warrant such cash
payment.  The merit of the Director’s
special circumstances plea shall be judged by the Committee.  The Committee’s decision as to whether the
Director’s special circumstances plea justifies the cash payment of the
Director’s Retainer Fees shall be final, conclusive, and not subject to appeal.


Article 6.         Deferral Opportunity


6.1     Amount
Which May Be Deferred.  A Participant who is a Director
may elect to defer up to one hundred percent (100%) of his or her Retainer Fees
for any Year and up to one hundred percent (100%) of his or her Meeting Fees
for each Board Meeting during any Year. 
The amount of Retainer Fees and Meeting Fees to be deferred shall be
expressed as a percentage of the Value of the fees otherwise payable (in cash
or Stock) for the Participant’s service as a Director of the Company.  A Participant who is a Key Executive may
elect to defer up to one hundred percent (100%) of Salary and/or Bonus in any
Year.  The minimum amount of any single
eligible component of Compensation which may be deferred in any Year is the
greater of five percent (5%) of such component or one thousand dollars
($1,000).  In addition, an election to
defer Compensation in any Year shall be expressed by each Participant in
minimum increments of either five percent (5%) of the applicable component of
Compensation or one thousand dollars ($1,000) or such other form acceptable to
the Committee.


6.2     Deferral
Election for Retainer Fees.  Participants
shall make their elections under the Plan to defer their Retainer Fees no later
than December 20 prior to the beginning of each Year, or not later than thirty
(30) calendar days following notification of initial eligibility to participate
herein (with respect to Retainer Fees not yet earned or paid).  All elections to defer Retainer Fees shall be
made on an “Election to Defer Form,” as described herein and shall be delivered
by the Participant to the Committee (or its delegate) as described in Section
12.1 herein.  The deferral election with
respect to Retainer Fees shall automatically remain in effect for the Year in
question (for which it shall be irrevocable) and for all subsequent periods the
Participant participates in the Plan until revoked or changed by the
Participant.  The deferral may be revoked
or changed with respect to future Years only by delivering a new election on an
“Election to Defer Form” no later than December 20 prior to the beginning of
the Year.


Participants who are Directors shall make the following elections on an
“Election to Defer Form”:


 


 


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(a)           The amount to be
deferred with respect to his or her Retainer Fees for the Year, pursuant to the
terms of Section 6.1 herein; and


(b)           The form of payment
to be made to the Participant at the end of the deferral period, pursuant to
the terms of Section 6.6 herein.


6.3          Deferral
Election for Meeting Fees.  Participants
shall make their elections to defer their Meeting Fees under the Plan no later
than December 20 prior to the beginning of each Year or no later than thirty
(30) calendar days following notification of initial eligibility to participate
in the Plan (with respect to Meeting Fees not yet earned or paid).  All elections to defer Meeting Fees shall be
made on an “Election to Defer Form,” as described in Section 6.2 herein and
shall be delivered by the Participant to the Committee (or its delegate) as
described in Section 12.1 herein.  On the
“Election to Defer Form” described in Section 6.2, the Participant shall elect
(in addition to any other relevant elections described in Section 6.2 herein) the
amount to be deferred with respect to his or her Meeting Fees for each Board
Meeting, pursuant to the terms of Section 6.1 herein.  The deferral election with respect to Meeting
Fees shall automatically remain in effect for the Year in question (for which
it shall be irrevocable) and for all subsequent periods the Participant
participates in the Plan until revoked or changed by the Participant.  The deferral may be revoked or changed with
respect to future Board Meetings by filing with the Committee (or its delegate)
a new election on an “Election to Defer Form” no later than December 20 prior
to the beginning of the Year.


6.4          Deferral
Election for Compensation.  Participants
shall make their elections under the Plan to defer their Compensation no later
than December 20 prior to the beginning of each Year, or not later than thirty
(30) calendar days following notification of initial eligibility to participate
herein (with respect to Compensation not yet earned or paid).  All elections to defer Compensation shall be
made on an “Election to Defer Form,” as described herein and shall be delivered
by the Participant to the Committee (or its delegate) as described in Section
12.1 herein.  The deferral election with
respect to Compensation shall automatically remain in effect for the Year in
question (for which it shall be irrevocable) and for all subsequent periods the
Participant participates in the Plan until revoked or changed by the
Participant.  The deferral may be revoked
or changed with respect to future Years only by delivering a new election on an
“Election to Defer Form” no later than December 20 prior to the beginning of
the Year.


Participants who are Key Executives shall make the following elections
on an “Election to Defer Form”:


(a)  The amount to be deferred
with respect to his or her Salary and/or Bonus for the Year, pursuant to the
terms of Section 6.1 herein; and


(b)  The form of payment to be
made to the Participant at the end of the deferral period, pursuant to the
terms of Section 6.6 herein.


6.5          Length
of Deferral.  Except as otherwise provided in Section 6.8,
the amounts deferred by each Participant and the accumulated earnings thereon
shall be paid (or commence to be paid) to the Participant as provided in
Sections 6.6 and 6.7 herein in January following the


 


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Year in which the termination of the Participant’s
service as a Director or Key Executive of the Company occurs for any reason
other than death.  Notwithstanding
anything herein to the contrary, a Participant who is a Director and
subsequently ceases to qualify as a Director as a result of his or her becoming
a Key Executive shall not be deemed to have terminated service for purposes of
the Plan until such time as the Participant terminates service as both a Key
Executive and a member of the Board.  In
the event of the Participant’s death, the payment of the amounts deferred and
the accumulated earnings thereon (or, in the event of death following
commencement of installment payments, the remaining unpaid balance thereof)
shall be made in a single lump sum payment in the form provided in Section 6.7
herein as soon as administratively practical after the Participant’s death.


Notwithstanding anything herein to the contrary: no distributions to a
Specified Employee that are to be made as a result of the Specified Employee’s
termination from service for any reason other than death or Disability shall be
made or commence prior to the date that is six months after the date of
termination from service, or such shorter period that, in the opinion of
counsel, is sufficient to avoid the imposition of the additional tax under
Section 409A(a)(1)(B) of the Code or any other taxes or penalties imposed under
Section 409A (the “Section 409A Taxes”); provided that any distributions that
otherwise would have been payable during such six-month (or shorter) period
shall continue to accrue earnings under Section 7.2 and shall be distributed
(together with any earnings thereon) in lump sum on the first day following the
expiration of such six-month (or shorter) period.


6.6          Form
of Payment of Deferred Amounts.  Subject to
Section 6.8, Participants shall be entitled to elect to receive payment of
amounts deferred in any Year, together with earnings accrued thereon, at the
end of the deferral period in a single lump sum payment or by means of
installments, pursuant to the form elected by the Participant at the time the
Participant elected to defer such amounts. 
If no election is made with respect to amounts deferred in one or more
Years (and earnings accrued thereon), the Participant will be paid such amounts
in a single lump sum.  Notwithstanding
anything herein to the contrary, all of a Participant’s Grandfathered Deferrals
shall be paid in the same form.


(a)           Lump Sum
Payment.  Such payment of deferred
amounts and earnings accrued thereon shall be made to the Participant in
January following the Year in which he ceases to serve as a Director and/or Key
Executive, or at such later date, in each case, as set forth in Section 6.5
herein.


(b)           Installment
Payments.  Participants may elect to
receive the payout of deferred amounts and earnings accrued thereon in annual
installments, with a minimum number of installments of two (2), and a maximum
number of installments of ten (10).  The
initial payment shall be made in January following the Year in which he ceases
to serve as a Director and/or Key Executive, or at such later date, in each
case, as set forth in described in Section 6.5 herein.  The remaining installment payments shall be
made in January of each Year thereafter, until the Participant’s entire
deferred account has been paid in full. 
Earnings shall continue to accrue on the deferred amounts in the
Participant’s deferred account, as provided in Section 7.2 of this Plan.  The amount of each installment payment shall
be equal to the balance remaining in the Participant’s deferred account
immediately prior to each such payment, multiplied by a fraction,


 


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the numerator of which is one (1), and the denominator
of which is the number of installment payments remaining.


Subject to the following rules, with respect to Grandfathered Deferrals
a Participant may elect to change a form of benefit elected pursuant to this
Section 6.6 by filing a revised election form on an “Election to Defer Form,”
as described in Section 6.2 herein, specifying the new form of distribution:


(1)                                  An election to change the form of
distribution must be made no later than December 31 at least one (1) full Year
prior to the payout commencement date as described in Section 6.5 herein.  If a new election is submitted after this
date, the election shall be null and void, and the form of distribution shall
be determined under the Participant’s original election.


(2)                                  Any election to change the form of
distribution from installments to a lump sum is subject in all cases to the
approval of the Board.


(3)                                  No further election to change a form of
distribution shall be permitted with respect to amounts already subject to a
revised election submitted pursuant to this Section 6.6.


Participants shall not be permitted to change the form of their
distributions with respect to Section 409A Deferrals.


Notwithstanding anything to the contrary herein, if the deferred amounts
and accumulated earnings thereon to be paid to a Participant in the form of
installments is less than $50,000, the Committee may elect at or before the
time such installments are schedules to commence, in its sole and absolute
discretion, to make payment of such amounts to the Participant in a single lump
sum, notwithstanding the Participant’s election to receive such amounts in the
form of installments.


6.7          Type
of Payment of Deferred Amounts.  All payment of
deferred amounts hereunder shall be made in shares of Stock, provided that cash
in lieu of fractional shares of Stock may be distributed.


6.8          Financial
Hardship.  The Committee shall have the authority to
alter the timing or manner of payment of deferred amounts in the event that the
Participant establishes, to the satisfaction of the Committee, severe financial
hardship.  In such event, the Committee
may, in its sole discretion:


(a)           Authorize the
cessation of deferrals by such Participant under the Plan; or


(b)           Provide that all, or
a portion, of the amount previously deferred by the Participant shall
immediately be paid in a lump sum payment; or


(c)           Provide that all, or
a portion, of the installments payable over a period of time shall immediately
be paid in a lump sum payment.


 


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For purposes of this Section 6.8, with respect to Grandfathered
Deferrals, “severe financial hardship” shall mean any financial hardship
resulting from extraordinary and unforeseeable circumstances arising as a
result of one or more recent events beyond the control of the Participant.  For purposes of this Section 6.8, with
respect to Section 409A Deferrals, “severe financial hardship” shall mean shall
mean an unforeseeable emergency which constitutes a severe financial hardship
of the Participant or beneficiary resulting from an illness or accident of the
Participant or beneficiary, the Participant’s or beneficiary’s spouse, or the
Participant’s or beneficiary’s “dependent” (as defined in Section 152(a) of the
Code); loss of the Participant’s or beneficiary’s property due to casualty
(including the need to rebuild a home following damage to a home not otherwise
covered by insurance, for example, not as a result of a natural disaster); or
other similar extraordinary and unforeseeable circumstances arising as a result
of events beyond the control of the Participant or beneficiary.  In any event, payment may not be made to the
extent such emergency is or may be relieved: (i) through reimbursement or
compensation by insurance or otherwise; (ii) by liquidation of the Participant’s
assets, to the extent the liquidation of such assets would not itself cause
severe financial hardship; and (iii) by cessation of deferrals under the
Plan.  Withdrawals of amounts because of
a severe financial hardship may only be permitted to the extent reasonably
necessary to satisfy the hardship, plus to pay taxes on the withdrawal.  Examples of what are not considered to be
severe financial hardships include the need to send a Participant’s child to
college or the desire to purchase a home. 
The Participant’s account will be credited with earnings in accordance
with the Plan up to the date of distribution.


The severity of the financial hardship shall be judged by the
Committee.  The Committee’s decision with
respect to the severity of financial hardship and the manner in which, if at
all, the Participant’s future deferral opportunities shall be ceased, and/or
the manner in which, if at all, the payment of deferred amounts to the
Participant shall be altered or modified, shall be final and conclusive.


Article 7.               Deferred
Compensation Accounts


7.1          Participants’
Accounts.  The Company shall establish and maintain an
individual bookkeeping account for deferrals made by each Participant under
Article 6 herein.  Each account shall be
credited as of the date the amount deferred otherwise would have become due and
payable to the Participant and as provided in Section 7.2.  Each Participant’s account shall be one
hundred percent (100%) vested at all times.


7.2          Gains
and Losses on Deferred Amounts.  Each
Participant’s account for deferrals will be deemed to be invested in Stock,
including any dividends paid thereon (which will be deemed to be reinvested in
such Stock).  Each Participant’s account
will thus be adjusted and increased or decreased by the results of such deemed
investment from the time Plan deferrals are credited under Section 7.1 until
distributed pursuant to Article 6 hereof.


7.3          Charges
Against Accounts.  There shall be charged against each
Participant’s deferred account any payments made to the Participant or to his
or her beneficiary.


7.4          Designation
of Beneficiary.  Each Participant shall designate a
beneficiary or beneficiaries who, upon the Participant’s death, will receive
the deferred amounts that otherwise


 


13

















 


would have been paid to the Participant under the
Plan.  All designations shall be signed
by the Participant, and shall be in such form as prescribed by the
Committee.  Each designation shall be effective
as of the date delivered to the Chief Human Resources Officer of the Company by
the Participant.


Participants may change their designations of beneficiary on such form
as prescribed by the Committee.  The
payment of amounts deferred under the Plan shall be in accordance with the last
unrevoked written designation of beneficiary that has been signed by the
Participant and delivered by the Participant to the Chief Human Resources
Officer of the Company prior to the Participant’s death.


In the event that all the beneficiaries named by a Participant pursuant
to this Section 7.4 predecease the Participant, the deferred amounts that would
have been paid to the Participant or the Participant’s beneficiaries shall be
paid to the Participant’s estate.


In the event a Participant does not designate a beneficiary, or for any
reason such designation is ineffective, in whole or in part, the amounts that
otherwise would have been paid to the Participant or the Participant’s
beneficiaries under the Plan shall be paid to the Participant’s estate.


Article 8.               Rights
of Participants


8.1          Contractual
Obligation.  The Plan shall create a contractual
obligation on the part of the Company to make payments from the Participants’
accounts when due.  Payment of account
balances shall be made out of the general funds of the Company.


8.2          Unsecured
Interest.  No Participant or party claiming an interest
in deferred amounts of a Participant shall have any interest whatsoever in any
specific asset of the Company.  To the
extent that any party acquires a right to receive payments under the Plan, such
right shall be equivalent to that of an unsecured general creditor of the
Company.  The Company shall have no duty
to set aside or invest any amounts credited to Participants’ accounts under
this Plan.


Nothing contained in this Plan shall create a trust of any kind or a
fiduciary relationship between the Company and any Participant.  Nevertheless, the Company may establish one
or more trusts, with such trustee as the Committee may approve, for the purpose
of providing for the payment of deferred amounts and earnings thereon.  Such trust or trusts may be irrevocable, but
the assets thereof shall be subject to the claims of the Company’s general
creditors in the event of the Company’s bankruptcy or insolvency.  To the extent any deferred amounts and
earnings thereon under the Plan are actually paid from any such trust, the
Company shall have no further obligation with respect thereto, but to the
extent not so paid, such deferred amounts and earnings thereon shall remain the
obligation of, and shall be paid by, the Company.


8.3          No
Guarantee of Principal or Earnings.  Nothing
contained in the Plan shall constitute a guarantee by the Company or any other
person or entity that the amounts deferred hereunder will increase or shall not
decrease in value due to the deemed investment of such amounts in Stock.  The Stock may be a volatile investment and
decreases in the value thereof


 


14

















 


may result in a loss of some or all of the principal
amounts deferred hereunder.  Thus, it is
possible for the value of a Participant’s account to decrease as a result of
its deemed investment in Stock, if the value of the Stock decreases.


Article 9.               Number
and Source of Shares Available Under the Plan


Subject to adjustments as provided in this Article 9, the shares of
Stock that may be issued under the Plan shall not exceed an aggregate of
1,100,000 shares of Stock.  The Company
shall reserve a sufficient number of shares of Stock for purposes of the Plan,
as determined by the Committee.  Such
shares may be previously issued and outstanding shares of Stock reacquired by
the Company and held in its treasury, or may be authorized but unissued shares
of Stock, or may consist partly of each. 
If the Company shall at any time increase or decrease the number of
outstanding shares of Stock or change in any way the rights and privileges of
such shares by means of the payment of a stock dividend or any other
distribution upon such shares payable in Stock, or through a stock split,
subdivision, consolidation, combination, reclassification, or recapitalization
involving the Stock, then the Committee may increase, decrease, or change in
like manner the number, rights and privileges of the shares issuable under the
Plan as if such shares had been issued and outstanding, fully paid, and
nonassessable at the time of such occurrence in order to prevent dilution or
enlargement of Participants’ rights under the Plan.


Article 10.            Withholding
of Taxes


The Company shall have the right to require Participants to remit to
the Company an amount sufficient to satisfy any Federal, state, and local
withholding tax requirements, or to deduct from all payments made pursuant to
the Plan amounts sufficient to satisfy any withholding tax requirements.


Article 11.            Amendment
and Termination


The Company hereby reserves the right to amend, modify, or terminate
the Plan at any time by action of the Board, with or without prior notice.  No such amendment or termination shall in any
material manner adversely affect any Participant’s rights to amounts already
deferred or earned or earnings thereon up to the point of amendment or
termination or any rights of such Participant under any Stock theretofore paid
to him or her hereunder, without the consent of the Participant.  Notwithstanding anything herein to the
contrary, to the extent permissible under Section 409A without the imposition
of the Section 409A Taxes, in the event of any termination, the Board, in its
sole and absolute discretion may elect to liquidate the Plan and distribute to
each Participant all amounts deferred under the Plan (and earnings thereon) in
a lump sum or in installments; provided that all such distributions (i)
commence no earlier than the date that is twelve (12) months following the date
of such termination (or such earlier date permitted under Section 409A without
the imposition of the Section 409A Taxes) and (ii) are completed by the date
that is twenty-four (24) months following the date of such termination (or such
later date permitted under Section 409A without the imposition of the Section
409A Taxes).


 


15

















 


Article 12.            Miscellaneous


12.1        Notice. 
Unless otherwise prescribed by the Committee, any notice or filing
required or permitted to be given to the Company under the Plan shall be
sufficient if in writing and hand delivered, or sent by registered or certified
mail to the Chief Human Resources Officer of the Company.  Notice to the Chief Human Resources Officer
of the Company, if mailed, shall be addressed to the principal executive
offices of the Company.  Notice mailed to
a Participant shall be at such address as is given in the records of the
Company.  Notices 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.


12.2        Consideration
for Stock Issued.  Stock will be paid under the Plan in
consideration of the services of Participants as directors, employees and/or
officers of the Company.


12.3        Compliance
with Securities Laws, Listing Requirements, and Other Laws and Obligations. 
The Company shall not be obligated to deliver any shares of Stock under
this Plan, (a) until, in the opinion of the Company’s counsel, all applicable
federal and state laws and regulations have been complied with, (b) if the
outstanding Stock is at the time listed on any stock exchange, or quoted on any
automated quotation system, until the shares to be delivered have been listed
or authorized to be listed or quoted on such exchange or system upon official
notice of issuance, and (c) until all other legal matters in connection with
the issuance and delivery of such shares have been approved by the Company’s counsel.  If the sale of Stock has not been registered
under the Securities Act of 1933, as amended, the Company may require, as a
condition to the payment of Stock, such representations or agreements as
counsel for the Company may consider appropriate to avoid violation of such Act
and may require that the certificates evidencing such Stock bear an appropriate
legend restricting transfer.


12.4        No
Shareholder Rights Conferred.  Nothing
contained in the Plan or any agreement hereunder will confer upon any Participant
any rights of a shareholder of the Company unless and until shares of Stock are
issued to such Participant upon the payment of Stock.


12.5        No
Right to Stock.  Nothing in the Plan shall be construed to
give any Director or Key Executive any right to a grant of common stock under
the Plan unless all conditions described within the Plan are met as determined
in the sole discretion of the Committee.


12.6        Granted
Shares Have Same Status as Issued Shares.  Any shares of
common stock of the Company issued as a stock dividend, or as a result of stock
splits, combinations, exchanges of shares, reorganizations, mergers,
consolidations or otherwise with respect to shares of common stock granted
pursuant to the Plan shall have the same status and be subject to the same
restrictions as the shares granted.


12.7        Nontransferability. 
Except as provided below, Participants’ rights to deferred amounts,
contributions, and earnings accrued thereon under the Plan may not be sold,
transferred, assigned, or otherwise alienated or hypothecated, other than by
will or by the laws of descent and


 


16

















 


distribution, nor shall the Company make any payment
under the Plan to any assignee or creditor of a Participant.


Notwithstanding the foregoing, the Committee shall provide for
distributions from a Participant’s deferred compensation account to the extent
required by a court order that the Committee determines to satisfy the
requirements of a qualified domestic relations order within the meaning of
Section 206(d)(3) of ERISA.  The amounts
assigned to an alternate payee under such an order shall be paid in a lump sum
distribution as soon as administratively practical after the Committee
determines that the order meets the requirements of a qualified domestic
relations order.  All payments made
pursuant to any such order shall be charged against the Participant’s deferred
compensation account.


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


12.9        Gender
and Number.  Except where otherwise indicated by the
context, any masculine term used herein also shall include the feminine; the
plural shall include the singular, and the singular shall include the plural.


12.10      Costs
of the Plan.  All costs of implementing and administering
the Plan shall be borne by the Company.


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


12.12      Applicable
Law.  Except to the extent preempted by applicable
federal law, the Plan shall be governed by and construed in accordance with the
laws of the state of Tennessee.


12.13      Effective Date. 
This amendment and restatement of the Plan shall become effective at the
time that it is approved by the Board, subject to approval by the stockholders
of the Company by a majority of the votes cast by the holders of the common
stock, present in person or represented by proxy, and entitled to vote.


 


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