**Exhibit 10.9****VOLCOM, INC.****AMENDED AND RESTATED 2005 INCENTIVE AWARD PLAN****ARTICLE 1****PURPOSE**     The purpose of the Volcom, Inc. 2005 Amended and Restated Incentive Award Plan (the“Plan”) is to promote the success and enhance the value of Volcom, Inc. (the“Company”) by linking the personal interests of the members of the Board, Employees andConsultants to those of Company stockholders and by providing such individuals with an incentivefor outstanding performance to generate superior returns to Company stockholders. The Plan isfurther intended to provide flexibility to the Company in its ability to motivate, attract, andretain the services of members of the Board, Employees and Consultants upon whose judgment,interest, and special effort the successful conduct of the Company’s operation is largelydependent. The Plan amends and restates Section 11.1 of the 2005 Incentive Award Plan (the“Original Plan”).**ARTICLE 2****DEFINITIONS AND CONSTRUCTION**     Wherever the following terms are used in the Plan they shall have the meanings specifiedbelow, unless the context clearly indicates otherwise. The singular pronoun shall include theplural where the context so indicates.     2.1 “Award” means an Option, a Restricted Stock award, a Stock Appreciation Rightaward, a Performance Share award, a Performance Stock Unit award, a Dividend Equivalents award, aStock Payment award, a Deferred Stock award, a Restricted Stock Unit award, an Other Stock-BasedAward, or a Performance Bonus Award granted to a Participant pursuant to the Plan.     2.2 “Award Agreement” means any written agreement, contract, or other instrument ordocument evidencing an Award, including through an electronic medium.     2.3 “Board” means the Board of Directors of the Company.     2.4 “Code” means the Internal Revenue Code of 1986, as amended.     2.5 “Committee” means the committee of the Board described in Article 12.     2.6 “Consultant” means any consultant or adviser if:          (a) The consultant or adviser renders bona fide services to the Company;          (b) The services rendered by the consultant or adviser are not in connection with the offer orsale of securities in a capital-raising transaction and do not directly or indirectly promote ormaintain a market for the Company’s securities; and
 

 
          (c) The consultant or adviser is a natural person who has contracted directly with the Companyto render such services.     2.7 “Covered Employee” means an Employee who is, or could be, a “covered employee”within the meaning of Section 162(m) of the Code.     2.8 “Deferred Stock” means a right to receive a specified number of shares of Stockduring specified time periods pursuant to Article 8.     2.9 “Dividend Equivalents” means a right granted to a Participant pursuant to Article8 to receive the equivalent value (in cash or Stock) of dividends paid on Stock.     2.10 “Effective Date” shall have the meaning set forth in Section 13.1.     2.11 “Eligible Individual” means any person who is a member of the Board, an Employeeor a Consultant, as determined by the Committee.     2.12 “Employee” means any officer or other employee (as defined in accordance withSection 3401(c) of the Code) of the Company or any Subsidiary.     2.13 “Exchange Act” means the Securities Exchange Act of 1934, as amended.     2.14 “Fair Market Value” means, as of any given date, the fair market value of a shareof Stock on such date determined by such methods or procedures as may be established from time totime by the Committee. Unless otherwise determined by the Committee, if the Stock is listed on anyestablished stock exchange or a national market system, including, without limitation, the NasdaqNational Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market Valueshall be the closing selling price for a share of Stock as quoted on such exchange or system forsuch date or, if there is no closing selling price for the Stock on the date in question, theclosing selling price for a share of Stock on the last preceding date for which such quotationexists.     2.15 “Incentive Stock Option” means an Option that is intended to meet therequirements of Section 422 of the Code or any successor provision thereto.     2.16 “Independent Director” means a member of the Board who is not an Employee of theCompany.     2.17 “Non-Qualified Stock Option” means an Option that is not intended to be anIncentive Stock Option.     2.18 “Option” means a right granted to a Participant pursuant to Article 5 of the Planto purchase a specified number of shares of Stock at a specified price during specified timeperiods. An Option may be either an Incentive Stock Option or a Non-Qualified Stock Option.     2.19 “Other Stock-Based Award” means an Award granted or denominated in Stock or unitsof Stock pursuant to Section 8.7 of the Plan.
2

 
     2.20 “Participant” means any Eligible Individual who, as a member of the Board,Consultant or Employee, has been granted an Award pursuant to the Plan.     2.21 “Performance-Based Award” means an Award granted to selected Covered Employeespursuant to Articles 6 and 8, but which is subject to the terms and conditions set forth in Article9. All Performance-Based Awards are intended to qualify as Qualified Performance-BasedCompensation.     2.22 “Performance Bonus Award” has the meaning set forth in Section 8.8.     2.23 “Performance Criteria” means the criteria that the Committee selects for purposesof establishing the Performance Goal or Performance Goals for a Participant for a PerformancePeriod. The Performance Criteria that will be used to establish Performance Goals are limited tothe following: net earnings (either before or after interest, taxes, depreciation andamortization), economic value-added (as determined by the Committee), sales or revenue, net income(either before or after taxes), operating earnings, cash flow (including, but not limited to,operating cash flow and free cash flow), cash flow return on capital, return on net assets, returnon stockholders’ equity, return on assets, return on capital, stockholder returns, return on sales,gross or net profit margin, productivity, expense, margins, operating efficiency, customersatisfaction, working capital, earnings per share, price per share of Stock, and market share, anyof which may be measured either in absolute terms or as compared to any incremental increase or ascompared to results of a peer group. The Committee shall, within the time prescribed by Section162(m) of the Code, define in an objective fashion the manner of calculating the PerformanceCriteria it selects to use for such Performance Period for such Participant.     2.24 “Performance Goals” means, for a Performance Period, the goals established inwriting by the Committee for the Performance Period based upon the Performance Criteria. Dependingon the Performance Criteria used to establish such Performance Goals, the Performance Goals may beexpressed in terms of overall Company performance or the performance of a division, business unit,or an individual. The Committee, in its discretion, may, within the time prescribed by Section162(m) of the Code, adjust or modify the calculation of Performance Goals for such PerformancePeriod in order to prevent the dilution or enlargement of the rights of Participants (a) in theevent of, or in anticipation of, any unusual or extraordinary corporate item, transaction, event,or development, or (b) in recognition of, or in anticipation of, any other unusual or nonrecurringevents affecting the Company, or the financial statements of the Company, or in response to, or inanticipation of, changes in applicable laws, regulations, accounting principles, or businessconditions.     2.25 “Performance Period” means the one or more periods of time, which may be ofvarying and overlapping durations, as the Committee may select, over which the attainment of one ormore Performance Goals will be measured for the purpose of determining a Participant’s right to,and the payment of, a Performance-Based Award.     2.26 “Performance Share” means a right granted to a Participant pursuant to Article 8,to receive Stock, the payment of which is contingent upon achieving certain Performance Goals orother performance-based targets established by the Committee.
3

 
     2.27 “Performance Stock Unit” means a right granted to a Participant pursuant toArticle 8, to receive Stock, the payment of which is contingent upon achieving certain PerformanceGoals or other performance-based targets established by the Committee.     2.28 “Plan” means this Volcom, Inc. 2005 Incentive Award Plan, as it may be amendedfrom time to time.     2.29 “Public Trading Date” means the first date upon which Stock is listed (orapproved for listing) upon notice of issuance on any securities exchange or designated (or approvedfor designation) upon notice of issuance as a national market security on an interdealer quotationsystem.     2.30 “Qualified Performance-Based Compensation” means any compensation that isintended to qualify as “qualified performance-based compensation” as described in Section162(m)(4)(C) of the Code.     2.31 “Restricted Stock” means Stock awarded to a Participant pursuant to Article 6that is subject to certain restrictions and may be subject to risk of forfeiture.     2.32 “Restricted Stock Unit” means an Award granted pursuant to Section 8.6.     2.33 “Securities Act” shall mean the Securities Act of 1933, as amended.     2.34 “Stock” means the common stock of the Company, par value $0.001 per share, andsuch other securities of the Company that may be substituted for Stock pursuant to Article 11.     2.35 “Stock Appreciation Right” or “SAR” means a right granted pursuant toArticle 7 to receive a payment equal to the excess of the Fair Market Value of a specified numberof shares of Stock on the date the SAR is exercised over the Fair Market Value on the date the SARwas granted as set forth in the applicable Award Agreement.     2.36 “Stock Payment” means (a) a payment in the form of shares of Stock, or (b) anoption or other right to purchase shares of Stock, as part of any bonus, deferred compensation orother arrangement, made in lieu of all or any portion of the Participant’s compensation, grantedpursuant to Article 8.     2.37 “Subsidiary” means any “subsidiary corporation” as defined in Section 424(f) ofthe Code and any applicable regulations promulgated thereunder or any other entity of which amajority of the outstanding voting stock or voting power is beneficially owned directly orindirectly by the Company.
4

 
**ARTICLE 3****SHARES SUBJECT TO THE PLAN**     3.1 Number of Shares.          (a) Subject to Article 11 and Section 3.1(b), the maximum aggregate number of shares of Stockwhich may be issued or transferred pursuant to Awards under the Plan shall be 2,300,000 shares.The maximum aggregate number of shares of Stock which may be issued or transferred pursuant toAwards under the Plan shall automatically increase on the first trading day of January eachcalendar year during the term of the Plan, beginning with calendar year 2006, by an amount equal totwo percent (2%) of the total number of shares of Stock outstanding on the last trading day inDecember of the immediately preceding calendar year, but in no event shall any such annual increaseexceed 750,000 shares.          (b) To the extent that an Award terminates, expires, or lapses for any reason, any shares ofStock subject to the Award shall again be available for the grant of an Award pursuant to the Plan.Additionally, any shares of Stock tendered or withheld to satisfy the grant or exercise price ortax withholding obligation pursuant to any Award shall again be available for the grant of an Awardpursuant to the Plan. To the extent permitted by applicable law or any exchange rule, shares ofStock issued in assumption of, or in substitution for, any outstanding awards of any entityacquired in any form of combination by the Company or any Subsidiary shall not be counted againstshares of Stock available for grant pursuant to this Plan.     3.2 Stock Distributed. Any Stock distributed pursuant to an Award may consist, inwhole or in part, of authorized and unissued Stock, treasury Stock or Stock purchased on the openmarket.     3.3 Limitation on Number of Shares Subject to Awards. Notwithstanding any provisionin the Plan to the contrary, and subject to Article 11, the maximum number of shares of Stock withrespect to one or more Awards that may be granted to any one Participant during a rollingthree-year period (measured from the date of any grant) shall be 500,000.**ARTICLE 4****ELIGIBILITY AND PARTICIPATION**     4.1 Eligibility. Each Eligible Individual shall be eligible to be granted one or moreAwards pursuant to the Plan.     4.2 Participation. Subject to the provisions of the Plan, the Committee may, fromtime to time, select from among all Eligible Individuals, those to whom Awards shall be granted andshall determine the nature and amount of each Award. No Eligible Individual shall have any rightto be granted an Award pursuant to this Plan.     4.3 Foreign Participants. In order to assure the viability of Awards granted toParticipants employed in foreign countries, the Committee may provide for such special terms as itmay consider necessary or appropriate to accommodate differences in local law, tax policy, or
5

 
custom. Moreover, the Committee may approve such supplements to, or amendments, restatements,or alternative versions of, the Plan as it may consider necessary or appropriate for such purposeswithout thereby affecting the terms of the Plan as in effect for any other purpose; *provided,however*, that no such supplements, amendments, restatements, or alternative versions shall increasethe share limitations contained in Sections 3.1 and 3.3 of the Plan.**ARTICLE 5****STOCK OPTIONS**     5.1 General. The Committee is authorized to grant Options to Participants on thefollowing terms and conditions:          (a) Exercise Price. The exercise price per share of Stock subject to an Option shallbe determined by the Committee and set forth in the Award Agreement; *provided*that the exerciseprice for any Option shall not be less than 100% of the Fair Market Value of a share of Stock onthe date of grant.          (b) Time and Conditions of Exercise. The Committee shall determine the time or timesat which an Option may be exercised in whole or in part; *provided*, that the term of any Optiongranted under the Plan shall not exceed ten years. The Committee shall also determine theperformance or other conditions, if any, that must be satisfied before all or part of an Option maybe exercised.          (c) Payment. The Committee shall determine the methods by which the exercise price ofan Option may be paid, the form of payment, including, without limitation: (i) cash, (ii) shares ofStock held for such period of time as may be required by the Committee in order to avoid adverseaccounting consequences and having a Fair Market Value on the date of delivery equal to theaggregate exercise price of the Option or exercised portion thereof, or (iii) other propertyacceptable to the Committee (including through the delivery of a notice that the Participant hasplaced a market sell order with a broker with respect to shares of Stock then issuable uponexercise of the Option, and that the broker has been directed to pay a sufficient portion of thenet proceeds of the sale to the Company in satisfaction of the Option exercise price; *provided*thatpayment of such proceeds is then made to the Company upon settlement of such sale), and the methodsby which shares of Stock shall be delivered or deemed to be delivered to Participants.Notwithstanding any other provision of the Plan to the contrary, no Participant who is a member ofthe Board or an “executive officer” of the Company within the meaning of Section 13(k) of theExchange Act shall be permitted to pay the exercise price of an Option in any method which wouldviolate Section 13(k) of the Exchange Act.          (d) Evidence of Grant. All Options shall be evidenced by a written Award Agreementbetween the Company and the Participant. The Award Agreement shall include such additionalprovisions as may be specified by the Committee.     5.2 Incentive Stock Options. The terms of any Incentive Stock Options grantedpursuant to the Plan must comply with the conditions and limitations contained Section 13.2 andthis Section 5.2.
6

 
          (a) Eligibility. Incentive Stock Options may be granted only to employees of theCompany or any “subsidiary corporation” thereof (within the meaning of Section 424(f) of the Codeand the applicable regulations promulgated thereunder).          (b) Exercise Price. The exercise price per share of Stock shall be set by theCommittee; *provided*that subject to Section 5.2(d) the exercise price for any Incentive StockOption shall not be less than 100% of the Fair Market Value on the date of grant.          (c) Individual Dollar Limitation. The aggregate Fair Market Value (determined as ofthe time the Option is granted) of all shares of Stock with respect to which Incentive StockOptions are first exercisable by a Participant in any calendar year may not exceed $100,000 or suchother limitation as imposed by Section 422(d) of the Code, or any successor provision. To theextent that Incentive Stock Options are first exercisable by a Participant in excess of suchlimitation, the excess shall be considered Non-Qualified Stock Options.          (d) Ten Percent Owners. An Incentive Stock Option shall be granted to any individualwho, at the date of grant, owns stock possessing more than ten percent of the total combined votingpower of all classes of Stock of the Company only if such Option is granted at a price that is notless than 110% of Fair Market Value on the date of grant and the Option is exercisable for no morethan five years from the date of grant.          (e) Notice of Disposition. In the event that a Participant acquires shares of Stockby exercise of an Incentive Stock Option, such Participant shall give the Company prompt notice ofany disposition of such shares of Stock within (i) two years from the date of grant of suchIncentive Stock Option or (ii) one year after the transfer of such shares of Stock to theParticipant.          (f) Right to Exercise. During a Participant’s lifetime, an Incentive Stock Option maybe exercised only by the Participant.     5.3 Substitution of Stock Appreciation Rights. The Committee may provide in the AwardAgreement evidencing the grant of an Option that the Committee, in its sole discretion, shall haveto right to substitute a Stock Appreciation Right for such Option at any time prior to or uponexercise of such Option, subject to the provisions of Section 7.2 hereof; provided that such StockAppreciation Right shall be exercisable with respect to the same number of shares of Stock forwhich such substituted Option would have been exercisable.     5.4 Paperless Exercise. In the event that the Company establishes, for itself orusing the services of a third party, an automated system for the exercise of Options, such as asystem using an internet website or interactive voice response, then the paperless exercise ofoptions by a Participant may be permitted through the use of such an automated system.
7

 
     5.5 Granting of Options to Independent Directors. The Board may from time to time, inits sole discretion, and subject to the limitations of the Plan:          (a) Select from among the Independent Directors (including Independent Directors who havepreviously been granted Options under the Plan) such of them as in its opinion should be grantedOptions;          (b) Subject to Section 3.3, determine the number of shares of Stock that may be purchased uponexercise of the Options granted to such selected Independent Directors; and          (c) Subject to the provisions of this Article 5, determine the terms and conditions of suchOptions, consistent with the Plan.Options granted to Independent Directors shall be Non-Qualified Stock Options.**ARTICLE 6****RESTRICTED STOCK AWARDS**     6.1 Grant of Restricted Stock. The Committee is authorized to make Awards ofRestricted Stock to any Participant selected by the Committee in such amounts and subject to suchterms and conditions as determined by the Committee. All Awards of Restricted Stock shall beevidenced by a written Restricted Stock Award Agreement.     6.2 Issuance and Restrictions. Restricted Stock shall be subject to such restrictionson transferability and other restrictions as the Committee may impose (including, withoutlimitation, limitations on the right to vote Restricted Stock or the right to receive dividends onthe Restricted Stock). These restrictions may lapse separately or in combination at such times,pursuant to such circumstances, in such installments, or otherwise, as the Committee determines atthe time of the grant of the Award or thereafter.     6.3 Forfeiture. Except as otherwise determined by the Committee at the time of thegrant of the Award or thereafter, upon termination of employment or service during the applicablerestriction period, Restricted Stock that is at that time subject to restrictions shall beforfeited; *provided, however*, that the Committee may (a) provide in any Restricted Stock AwardAgreement that restrictions or forfeiture conditions relating to Restricted Stock will be waived inwhole or in part in the event of terminations resulting from specified causes, and (b) in othercases waive in whole or in part restrictions or forfeiture conditions relating to Restricted Stock.     6.4 Certificates for Restricted Stock. Restricted Stock granted pursuant to the Planmay be evidenced in such manner as the Committee shall determine. If certificates representingshares of Restricted Stock are registered in the name of the Participant, certificates must bear anappropriate legend referring to the terms, conditions, and restrictions applicable to suchRestricted Stock, and the Company may, at its discretion, retain physical possession of thecertificate until such time as all applicable restrictions lapse.
8

 
**ARTICLE 7****STOCK APPRECIATION RIGHTS**     7.1 Grant of Stock Appreciation Rights. A Stock Appreciation Right may be granted toany Participant selected by the Committee. A Stock Appreciation Right may be granted (a) inconnection and simultaneously with the grant of an Option, (b) with respect to a previously grantedOption, or (c) independent of an Option. A Stock Appreciation Right shall be subject to such termsand conditions not inconsistent with the Plan as the Committee shall impose and shall be evidencedby an Award Agreement.     7.2 Coupled Stock Appreciation Rights.          (a) A Coupled Stock Appreciation Right (“CSAR”) shall be related to a particularOption and shall be exercisable only when and to the extent the related Option is exercisable.          (b) A CSAR may be granted to a Participant for no more than the number of shares subject tothe simultaneously granted Option to which it is coupled.          (c) A CSAR shall entitle the Participant (or other person entitled to exercise the Optionpursuant to the Plan) to surrender to the Company the unexercised portion of the Option to whichthe CSAR relates (to the extent then exercisable pursuant to its terms) and to receive from theCompany in exchange therefor an amount determined by multiplying the difference obtained bysubtracting the Option exercise price from the Fair Market Value of a share of Stock on the date ofexercise of the CSAR by the number of shares of Stock with respect to which the CSAR shall havebeen exercised, subject to any limitations the Committee may impose.     7.3 Independent Stock Appreciation Rights.          (a) An Independent Stock Appreciation Right (“ISAR”) shall be unrelated to any Optionand shall have a term set by the Committee. An ISAR shall be exercisable in such installments asthe Committee may determine. An ISAR shall cover such number of shares of Stock as the Committeemay determine. The exercise price per share of Stock subject to each ISAR shall be set by theCommittee; *provided, however,*that the exercise price for any ISAR shall not be less than 100% ofthe Fair Market Value on the date of grant; and *provided, further*, that the Committee in its soleand absolute discretion may provide that the ISAR may be exercised subsequent to a termination ofemployment or service, as applicable, or following a merger, consolidation or other similartransaction involving the Company, or because of the Participant’s retirement, death or disability,or otherwise.          (b) An ISAR shall entitle the Participant (or other person entitled to exercise the ISARpursuant to the Plan) to exercise all or a specified portion of the ISAR (to the extent thenexercisable pursuant to its terms) and to receive from the Company an amount determined bymultiplying the difference obtained by subtracting the exercise price per share of the ISAR fromthe Fair Market Value of a share of Stock on the date of exercise of the ISAR by the
9

 
number of shares of Stock with respect to which the ISAR shall have been exercised, subject toany limitations the Committee may impose.     7.4 Payment and Limitations on Exercise.          (a) Payment of the amounts determined under Sections 7.2(c) and 7.3(b) above shall be in cash,in Stock (based on its Fair Market Value as of the date the Stock Appreciation Right is exercised)or a combination of both, as determined by the Committee.          (b) To the extent payment for a Stock Appreciation Right is to be made in cash, the AwardAgreement shall, to the extent necessary to comply with the requirements to Section 409A of theCode, specify the date of payment which may be different than the date of exercise of the StockAppreciation Right. If the date of payment for a Stock Appreciation Right is later than the dateof exercise, the Award Agreement may specify that the Participant be entitled to earnings on suchamount until paid.          (c) To the extent any payment under Section 7.2(c) or 7.3(b) is effected in Stock it shall bemade subject to satisfaction of all provisions of Article 5 above pertaining to Options.**ARTICLE 8****OTHER TYPES OF AWARDS**     8.1 Performance Share Awards. Any Participant selected by the Committee may begranted one or more Performance Share awards which shall be denominated in a number of shares ofStock and which may be linked to any one or more of the Performance Criteria or other specificperformance criteria determined appropriate by the Committee, in each case on a specified date ordates or over any period or periods determined by the Committee. In making such determinations,the Committee shall consider (among such other factors as it deems relevant in light of thespecific type of award) the contributions, responsibilities and other compensation of theparticular Participant.     8.2 Performance Stock Units. Any Participant selected by the Committee may be grantedone or more Performance Stock Unit awards which shall be denominated in units of value includingdollar value of shares of Stock and which may be linked to any one or more of the PerformanceCriteria or other specific performance criteria determined appropriate by the Committee, in eachcase on a specified date or dates or over any period or periods determined by the Committee. Inmaking such determinations, the Committee shall consider (among such other factors as it deemsrelevant in light of the specific type of award) the contributions, responsibilities and othercompensation of the particular Participant.     8.3 Dividend Equivalents.          (a) Any Participant selected by the Committee may be granted Dividend Equivalents based on thedividends declared on the shares of Stock that are subject to any Award, to be credited as ofdividend payment dates, during the period between the date the Award is granted and the date theAward is exercised, vests or expires, as determined by the
10

 
Committee. Such Dividend Equivalents shall be converted to cash or additional shares of Stockby such formula and at such time and subject to such limitations as may be determined by theCommittee.          (b) Dividend Equivalents granted with respect to Options or SARs that are intended to beQualified Performance-Based Compensation shall be payable, with respect to pre-exercise periods,regardless of whether such Option or SAR is subsequently exercised.     8.4 Stock Payments. Any Participant selected by the Committee may receive StockPayments in the manner determined from time to time by the Committee. The number of shares shallbe determined by the Committee and may be based upon the Performance Criteria or other specificperformance criteria determined appropriate by the Committee, determined on the date such StockPayment is made or on any date thereafter.     8.5 Deferred Stock. Any Participant selected by the Committee may be granted an awardof Deferred Stock in the manner determined from time to time by the Committee. The number ofshares of Deferred Stock shall be determined by the Committee and may be linked to the PerformanceCriteria or other specific performance criteria determined to be appropriate by the Committee, ineach case on a specified date or dates or over any period or periods determined by the Committee.Stock underlying a Deferred Stock award will not be issued until the Deferred Stock award hasvested, pursuant to a vesting schedule or performance criteria set by the Committee. Unlessotherwise provided by the Committee, a Participant awarded Deferred Stock shall have no rights as aCompany stockholder with respect to such Deferred Stock until such time as the Deferred Stock Awardhas vested and the Stock underlying the Deferred Stock Award has been issued.     8.6 Restricted Stock Units. The Committee is authorized to make Awards of RestrictedStock Units to any Participant selected by the Committee in such amounts and subject to such termsand conditions as determined by the Committee. At the time of grant, the Committee shall specifythe date or dates on which the Restricted Stock Units shall become fully vested and nonforfeitable,and may specify such conditions to vesting as it deems appropriate. At the time of grant, theCommittee shall specify the maturity date applicable to each grant of Restricted Stock Units whichshall be no earlier than the vesting date or dates of the Award and, subject to compliance with therequirements of Section 409A of the Code, may be determined at the election of the grantee. On thematurity date, the Company shall, subject to Section 10.5(b), transfer to the Participant oneunrestricted, fully transferable share of Stock for each Restricted Stock Unit scheduled to be paidout on such date and not previously forfeited. The Committee shall specify the purchase price, ifany, to be paid by the grantee to the Company for such shares of Stock.     8.7 Other Stock-Based Awards. Any Participant selected by the Committee may begranted one or more Awards that provide Participants with shares of Stock or the right to purchaseshares of Stock or that have a value derived from the value of, or an exercise or conversionprivilege at a price related to, or that are otherwise payable in shares of Stock and which may belinked to any one or more of the Performance Criteria or other specific performance criteriadetermined appropriate by the Committee, in each case on a specified date or dates or over anyperiod or periods determined by the Committee. In making such
11

 
determinations, the Committee shall consider (among such other factors as it deems relevant inlight of the specific type of Award) the contributions, responsibilities and other compensation ofthe particular Participant.     8.8 Performance Bonus Awards. Any Participant selected by the Committee may begranted one or more Awards in the form of a cash bonus (a “Performance Bonus Award”)payable with respect to any period of employment and based upon any performance criteria andsubject to any terms and conditions that the Committee may determine, in its sole discretion. Thepayment of bonuses pursuant to this Section 8.8 shall be made on any date or dates determined bythe Committee and subject to any terms and conditions determined by the Committee, in its solediscretion.     8.9 Term. Except as otherwise provided herein, the term of any Award of PerformanceShares, Performance Stock Units, Dividend Equivalents, Stock Payments, Deferred Stock, RestrictedStock Units or Other Stock-Based Award shall be set by the Committee in its discretion.     8.10 Exercise or Purchase Price. The Committee may establish the exercise or purchaseprice, if any, of any Award of Performance Shares, Performance Stock Units, Deferred Stock, StockPayments, Restricted Stock Units or Other Stock-Based Award; *provided, however*, that such priceshall not be less than the par value of a share of Stock on the date of grant, unless otherwisepermitted by applicable state law.     8.11 Exercise Upon Termination of Employment or Service. An Award of PerformanceShares, Performance Stock Units, Dividend Equivalents, Deferred Stock, Stock Payments, RestrictedStock Units and Other Stock-Based Award shall only be exercisable or payable while the Participantis an Employee, Consultant or a member of the Board, as applicable; *provided, however*, that theCommittee in its sole and absolute discretion may provide that an Award of Performance Shares,Performance Stock Units, Dividend Equivalents, Stock Payments, Deferred Stock, Restricted StockUnits or Other Stock-Based Award may be exercised or paid subsequent to a termination of employmentor service, as applicable, or following a merger, consolidation or other similar transactioninvolving the Company, or because of the Participant’s retirement, death or disability, orotherwise; *provided, however*, that any such provision with respect to Performance Shares orPerformance Stock Units shall be subject to the requirements of Section 162(m) of the Code thatapply to Qualified Performance-Based Compensation.     8.12 Form of Payment. Payments with respect to any Awards granted under this Article8 shall be made in cash, in Stock or a combination of both, as determined by the Committee.     8.13 Award Agreement. All Awards under this Article 8 shall be subject to suchadditional terms and conditions as determined by the Committee and shall be evidenced by a writtenAward Agreement.
12

 
**ARTICLE 9****PERFORMANCE-BASED AWARDS**     9.1 Purpose. The purpose of this Article 9 is to provide the Committee the ability toqualify Awards other than Options and SARs and that are granted pursuant to Articles 6 and 8 asQualified Performance-Based Compensation. If the Committee, in its discretion, decides to grant aPerformance-Based Award to a Covered Employee, the provisions of this Article 9 shall control overany contrary provision contained in Articles 6 or 8; *provided, however*, that the Committee may inits discretion grant Awards to Covered Employees that are based on Performance Criteria orPerformance Goals but that do not satisfy the requirements of this Article 9.     9.2 Applicability. This Article 9 shall apply only to those Covered Employeesselected by the Committee to receive Performance-Based Awards. The designation of a CoveredEmployee as a Participant for a Performance Period shall not in any manner entitle the Participantto receive an Award for the period. Moreover, designation of a Covered Employee as a Participantfor a particular Performance Period shall not require designation of such Covered Employee as aParticipant in any subsequent Performance Period and designation of one Covered Employee as aParticipant shall not require designation of any other Covered Employees as a Participant in suchperiod or in any other period.     9.3 Procedures with Respect to Performance-Based Awards. To the extent necessary tocomply with the Qualified Performance-Based Compensation requirements of Section 162(m)(4)(C) ofthe Code, with respect to any Award granted under Articles 6 and 8 which may be granted to one ormore Covered Employees, no later than ninety (90) days following the commencement of any fiscalyear in question or any other designated fiscal period or period of service (or such other time asmay be required or permitted by Section 162(m) of the Code), the Committee shall, in writing, (a)designate one or more Covered Employees, (b) select the Performance Criteria applicable to thePerformance Period, (c) establish the Performance Goals, and amounts of such Awards, as applicable,which may be earned for such Performance Period, and (d) specify the relationship betweenPerformance Criteria and the Performance Goals and the amounts of such Awards, as applicable, to beearned by each Covered Employee for such Performance Period. Following the completion of eachPerformance Period, the Committee shall certify in writing whether the applicable Performance Goalshave been achieved for such Performance Period. In determining the amount earned by a CoveredEmployee, the Committee shall have the right to reduce or eliminate (but not to increase) theamount payable at a given level of performance to take into account additional factors that theCommittee may deem relevant to the assessment of individual or corporate performance for thePerformance Period.     9.4 Payment of Performance-Based Awards. Unless otherwise provided in the applicableAward Agreement, a Participant must be employed by the Company or a Subsidiary on the day aPerformance-Based Award for such Performance Period is paid to the Participant. Furthermore, aParticipant shall be eligible to receive payment pursuant to a Performance-Based Award for aPerformance Period only if the Performance Goals for such period are achieved.
13

 
     9.5 Additional Limitations. Notwithstanding any other provision of the Plan, anyAward which is granted to a Covered Employee and is intended to constitute QualifiedPerformance-Based Compensation shall be subject to any additional limitations set forth in Section162(m) of the Code (including any amendment to Section 162(m) of the Code) or any regulations orrulings issued thereunder that are requirements for qualification as qualified performance-basedcompensation as described in Section 162(m)(4)(C) of the Code, and the Plan shall be deemed amendedto the extent necessary to conform to such requirements.**ARTICLE 10****PROVISIONS APPLICABLE TO AWARDS**     10.1 Stand-Alone and Tandem Awards. Awards granted pursuant to the Plan may, in thediscretion of the Committee, be granted either alone, in addition to, or in tandem with, any otherAward granted pursuant to the Plan. Awards granted in addition to or in tandem with other Awardsmust be granted at the same time as the grant of such other Awards.     10.2 Award Agreement. Awards under the Plan shall be evidenced by Award Agreementsthat set forth the terms, conditions and limitations for each Award which may include the term ofan Award, the provisions applicable in the event the Participant’s employment or serviceterminates, and the Company’s authority to unilaterally or bilaterally amend, modify, suspend,cancel or rescind an Award.     10.3 Limits on Transfer. No right or interest of a Participant in any Award may bepledged, encumbered, or hypothecated to or in favor of any party other than the Company or aSubsidiary, or shall be subject to any lien, obligation, or liability of such Participant to anyother party other than the Company or a Subsidiary. Except as otherwise provided by the Committee,no Award shall be assigned, transferred, or otherwise disposed of by a Participant other than bywill or the laws of descent and distribution. The Committee by express provision in the Award oran amendment thereto may permit an Award (other than an Incentive Stock Option) to be transferredto, exercised by and paid to certain persons or entities related to the Participant, including butnot limited to members of the Participant’s family, charitable institutions, or trusts or otherentities whose beneficiaries or beneficial owners are members of the Participant’s family and/orcharitable institutions, or to such other persons or entities as may be expressly approved by theCommittee, pursuant to such conditions and procedures as the Committee may establish. Anypermitted transfer shall be subject to the condition that the Committee receive evidencesatisfactory to it that the transfer is being made for estate and/or tax planning purposes (or to a“blind trust” in connection with the Participant’s termination of employment or service with theCompany or a Subsidiary to assume a position with a governmental, charitable, educational orsimilar non-profit institution) and on a basis consistent with the Company’s lawful issue ofsecurities.     10.4 Beneficiaries. Notwithstanding Section 10.3, a Participant may, in the mannerdetermined by the Committee, designate a beneficiary to exercise the rights of the Participant andto receive any distribution with respect to any Award upon the Participant’s death. A beneficiary,legal guardian, legal representative, or other person claiming any rights pursuant to
14

 
the Plan is subject to all terms and conditions of the Plan and any Award Agreement applicableto the Participant, except to the extent the Plan and Award Agreement otherwise provide, and to anyadditional restrictions deemed necessary or appropriate by the Committee. If the Participant ismarried and resides in a community property state, a designation of a person other than theParticipant’s spouse as his or her beneficiary with respect to more than 50% of the Participant’sinterest in the Award shall not be effective without the prior written consent of the Participant’sspouse. If no beneficiary has been designated or survives the Participant, payment shall be madeto the person entitled thereto pursuant to the Participant’s will or the laws of descent anddistribution. Subject to the foregoing, a beneficiary designation may be changed or revoked by aParticipant at any time provided the change or revocation is filed with the Committee.     10.5 Stock Certificates; Book Entry Procedures.          (a) Notwithstanding anything herein to the contrary, the Company shall not be required toissue or deliver any certificates evidencing shares of Stock pursuant to the exercise of any Award,unless and until the Board has determined, with advice of counsel, that the issuance and deliveryof such certificates is in compliance with all applicable laws, regulations of governmentalauthorities and, if applicable, the requirements of any exchange on which the shares of Stock arelisted or traded. All Stock certificates delivered pursuant to the Plan are subject to anystop-transfer orders and other restrictions as the Committee deems necessary or advisable to complywith federal, state, or foreign jurisdiction, securities or other laws, rules and regulations andthe rules of any national securities exchange or automated quotation system on which the Stock islisted, quoted, or traded. The Committee may place legends on any Stock certificate to referencerestrictions applicable to the Stock. In addition to the terms and conditions provided herein, theBoard may require that a Participant make such reasonable covenants, agreements, andrepresentations as the Board, in its discretion, deems advisable in order to comply with any suchlaws, regulations, or requirements. The Committee shall have the right to require any Participantto comply with any timing or other restrictions with respect to the settlement or exercise of anyAward, including a window-period limitation, as may be imposed in the discretion of the Committee.          (b) Notwithstanding any other provision of the Plan, unless otherwise determined by theCommittee or required by any applicable law, rule or regulation, the Company shall not deliver toany Participant certificates evidencing shares of Stock issued in connection with any Award andinstead such shares of Stock shall be recorded in the books of the Company (or, as applicable, itstransfer agent or stock plan administrator).**ARTICLE 11****CHANGES IN CAPITAL STRUCTURE**     11.1 Adjustments.          (a) In the event of any stock dividend, stock split, combination or exchange of shares,merger, consolidation, spin-off, recapitalization, distribution of Company assets to stockholders(other than normal cash dividends), or any other corporate event affecting the number ofoutstanding shares of Stock or the share price of the Stock, the Committee must make
15

 
such proportionate adjustments, as required, to reflect such changes with respect to (i) theaggregate number and type of shares that may be issued under the Plan (including, but not limitedto, adjustments of the limitations in Sections 3.1 and 3.3); (ii) the terms and conditions of anyoutstanding Awards (including, without limitation, any applicable performance targets or criteriawith respect thereto); and (iii) the grant or exercise price per share for any outstanding Awardsunder the Plan. Any adjustment affecting an Award intended as Qualified Performance-BasedCompensation shall be made consistent with the requirements of Section 162(m) of the Code.          (b) In the event of any transaction or event described in Section 11.1(a) or any unusual ornonrecurring transactions or events affecting the Company, any affiliate of the Company, or thefinancial statements of the Company or any affiliate, or of changes in applicable laws, regulationsor accounting principles, and in order to prevent the dilution or enlargement of the benefits orpotential benefits intended to be made available under the Plan or with respect to any Award underthe Plan, to facilitate such transactions or events or to give effect to such changes in laws,regulations or principles, the Committee either by amendment of the terms of any outstanding Awardsor by action taken prior to the occurrence of such transaction or event and either automatically orupon the Participant’s request, shall, as required, take any one or more of the following actions:                    (i) To provide for either (A) termination of any such Award in exchange for an amount of cashand/or other property, if any, equal to the amount that would have been attained upon the exerciseof such Award or realization of the Participant’s rights (and, for the avoidance of doubt, if as ofthe date of the occurrence of the transaction or event described in this Section 11.1(b) theCommittee determines in good faith that no amount would have been attained upon the exercise ofsuch Award or realization of the Participant’s rights, then such Award may be terminated by theCompany without payment) or (B) the replacement of such Award with other rights or propertyselected by the Committee in its sole discretion;                    (ii) To provide that such Award be assumed by the successor or survivor corporation, or aparent or subsidiary thereof, or shall be substituted for by similar options, rights or awardscovering the stock of the successor or survivor corporation, or a parent or subsidiary thereof,with appropriate adjustments as to the number and kind of shares and prices;                    (iii) To make adjustments in the number and type of shares of Stock (or other securities orproperty) subject to outstanding Awards, and in the number and kind of outstanding Restricted Stockor Deferred Stock and/or in the terms and conditions of (including the grant or exercise price),and the criteria included in, outstanding options, rights and awards and options, rights and awardswhich may be granted in the future;                    (iv) To provide that such Award shall be exercisable or payable or fully vested with respectto all shares covered thereby, notwithstanding anything to the contrary in the Plan or theapplicable Award Agreement; and                    (v) To provide that the Award cannot vest, be exercised or become payable after such event.
16

 
     11.2 Corporate Transactions. Notwithstanding Section 11.1, and except as mayotherwise be provided in any applicable Award Agreement or other written agreement entered intobetween the Company and a Participant, in the event of any merger, consolidation or other similartransaction involving the Company in which a Participant’s Awards are not converted, assumed, orreplaced by a successor entity, then such Awards shall become fully exercisable immediately priorto the consummation of such transaction and all forfeiture restrictions on such Awards shall lapse.Upon, or in anticipation of, a merger, consolidation or other similar transaction involving theCompany, the Committee may cause any and all Awards outstanding hereunder to terminate at aspecific time in the future, including but not limited to the date of such transaction, and shallgive each Participant the right to exercise such Awards during a period of time as the Committee,in its sole and absolute discretion, shall determine. In the event that the terms of any agreementbetween the Company or any Company subsidiary or affiliate and a Participant contains provisionsthat conflict with and are more restrictive than the provisions of this Section 11.2, this Section11.2 shall prevail and control and the more restrictive terms of such agreement (and only suchterms) shall be of no force or effect.     11.3 No Other Rights. Except as expressly provided in the Plan, no Participant shallhave any rights by reason of any subdivision or consolidation of shares of stock of any class, thepayment of any dividend, any increase or decrease in the number of shares of stock of any class orany dissolution, liquidation, merger, or consolidation of the Company or any other corporation.Except as expressly provided in the Plan or pursuant to action of the Committee under the Plan, noissuance by the Company of shares of stock of any class, or securities convertible into shares ofstock of any class, shall affect, and no adjustment by reason thereof shall be made with respectto, the number of shares of Stock subject to an Award or the grant or exercise price of any Award.**ARTICLE 12****ADMINISTRATION**     12.1 Committee. Unless and until the Board delegates administration of the Plan to aCommittee as set forth below, the Plan shall be administered by the full Board, and for suchpurposes the term “Committee” as used in this Plan shall be deemed to refer to the Board. TheBoard, at its discretion or as otherwise necessary to comply with the requirements of Section162(m) of the Code, Rule 16b-3 promulgated under the Exchange Act or to the extent required by anyother applicable rule or regulation, shall delegate administration of the Plan to a Committee. TheCommittee shall consist solely of two or more members of the Board each of whom is both an “outsidedirector,” within the meaning of Section 162(m) of the Code, and a “non-employee director,” asdefined in Rule 16b-3(b)(3) of the Exchange Act, or any successor definition adopted by the Board.Notwithstanding the foregoing: (a) the full Board, acting by a majority of its members in office,shall conduct the general administration of the Plan with respect to all Awards granted toIndependent Directors and for purposes of such Awards the term “Committee” as used in this Planshall be deemed to refer to the Board and (b) the Committee may delegate its authority hereunder tothe extent permitted by Section 12.5. Appointment of Committee members shall be effective uponacceptance of appointment. The Board may abolish the Committee at any time and revest in the Boardthe administration of the Plan. Committee members may resign at any time by delivering writtennotice to the Board. Vacancies in the
17

 
Committee may only be filled by the Board.     12.2 Action by the Committee. A majority of the Committee shall constitute a quorum.The acts of a majority of the members present at any meeting at which a quorum is present, and actsapproved in writing by a majority of the Committee in lieu of a meeting, shall be deemed the actsof the Committee. Each member of the Committee is entitled to, in good faith, rely or act upon anyreport or other information furnished to that member by any officer or other employee of theCompany or any Subsidiary, the Company’s independent certified public accountants, or any executivecompensation consultant or other professional retained by the Company to assist in theadministration of the Plan.     12.3 Authority of Committee. Subject to any specific designation in the Plan, theCommittee has the exclusive power, authority and discretion to:          (a) Designate Participants to receive Awards;          (b) Determine the type or types of Awards to be granted to each Participant;          (c) Determine the number of Awards to be granted and the number of shares of Stock to which anAward will relate;          (d) Determine the terms and conditions of any Award granted pursuant to the Plan, including,but not limited to, the exercise price, grant price, or purchase price, any reload provision, anyrestrictions or limitations on the Award, any schedule for lapse of forfeiture restrictions orrestrictions on the exercisability of an Award, and accelerations or waivers thereof, anyprovisions related to non-competition and recapture of gain on an Award, based in each case on suchconsiderations as the Committee in its sole discretion determines; *provided, however*, that theCommittee shall not have the authority to accelerate the vesting or waive the forfeiture of anyPerformance-Based Awards;          (e) Determine whether, to what extent, and pursuant to what circumstances an Award may besettled in, or the exercise price of an Award may be paid in, cash, Stock, other Awards, or otherproperty, or an Award may be canceled, forfeited, or surrendered;          (f) Prescribe the form of each Award Agreement, which need not be identical for eachParticipant;          (g) Decide all other matters that must be determined in connection with an Award;          (h) Establish, adopt, or revise any rules and regulations as it may deem necessary oradvisable to administer the Plan;          (i) Interpret the terms of, and any matter arising pursuant to, the Plan or any AwardAgreement; and          (j) Make all other decisions and determinations that may be required pursuant to the Plan oras the Committee deems necessary or advisable to administer the Plan.
18

 
     12.4 Decisions Binding. The Committee’s interpretation of the Plan, any Awardsgranted pursuant to the Plan, any Award Agreement and all decisions and determinations by theCommittee with respect to the Plan are final, binding, and conclusive on all parties.     12.5 Delegation of Authority. To the extent permitted by applicable law, theCommittee may from time to time delegate to a committee of one or more members of the Board or oneor more officers of the Company the authority to grant or amend Awards to Participants other than(a) senior executives of the Company who are subject to Section 16 of the Exchange Act, (b) CoveredEmployees, or (c) officers of the Company (or members of the Board) to whom authority to grant oramend Awards has been delegated hereunder. Any delegation hereunder shall be subject to therestrictions and limits that the Committee specifies at the time of such delegation, and theCommittee may at any time rescind the authority so delegated or appoint a new delegatee. At alltimes, the delegatee appointed under this Section 12.5 shall serve in such capacity at the pleasureof the Committee.**ARTICLE 13****EFFECTIVE AND EXPIRATION DATE**     13.1 Effective Date. The Plan is effective as of the date the Plan is approved by theCompany’s stockholders (the “Effective Date”). The Plan will be deemed to be approved bythe stockholders if it receives the affirmative vote of the holders of a majority of the shares ofstock of the Company present or represented and entitled to vote at a meeting duly held inaccordance with the applicable provisions of the Company’s Bylaws.     13.2 Expiration Date. The Plan will expire on, and no Incentive Stock Option or otherAward may be granted pursuant to the Plan after, the earlier of the tenth anniversary of (i) theEffective Date or (ii) the date this Plan is approved by the Board. Any Awards that areoutstanding on the tenth anniversary of the Effective Date shall remain in force according to theterms of the Plan and the applicable Award Agreement.**ARTICLE 14****AMENDMENT, MODIFICATION, AND TERMINATION**     14.1 Amendment, Modification, And Termination. With the approval of the Board, at anytime and from time to time, the Committee may terminate, amend or modify the Plan; *provided,however*, that (a) to the extent necessary and desirable to comply with any applicable law,regulation, or stock exchange rule, the Company shall obtain stockholder approval of any Planamendment in such a manner and to such a degree as required, and (b) stockholder approval isrequired for any amendment to the Plan that (i) increases the number of shares available under thePlan (other than any adjustment as provided by Article 11), (ii) permits the Committee to grantOptions with an exercise price that is below Fair Market Value on the date of grant, or (iii)permits the Committee to extend the exercise period for an Option beyond ten years from the date ofgrant. Notwithstanding any provision in this Plan to the contrary, absent approval of thestockholders of the Company, no Option may be amended to reduce the per share exercise price of theshares subject to such Option below the per share exercise price as of the date the Option
19

 
is granted and, except as permitted by Article 11, no Option may be granted in exchange for,or in connection with, the cancellation or surrender of an Option having a higher per shareexercise price.     14.2 Awards Previously Granted. Except as otherwise provided in Section 15.13 below,no termination, amendment, or modification of the Plan shall adversely affect in any material wayany Award previously granted pursuant to the Plan without the prior written consent of theParticipant.**ARTICLE 15****GENERAL PROVISIONS**     15.1 No Rights to Awards. No Eligible Individual or other person shall have any claimto be granted any Award pursuant to the Plan, and neither the Company nor the Committee isobligated to treat Eligible Individuals, Participants or any other persons uniformly.     15.2 No Stockholders Rights. Except as otherwise provided herein, a Participant shallhave none of the rights of a stockholder with respect to shares of Stock covered by any Award untilthe Participant becomes the record owner of such shares of Stock.     15.3 Withholding. The Company or any Subsidiary shall have the authority and theright to deduct or withhold, or require a Participant to remit to the Company, an amount sufficientto satisfy federal, state, local and foreign taxes (including the Participant’s FICA obligation)required by law to be withheld with respect to any taxable event concerning a Participant arisingas a result of this Plan. The Committee may in its discretion and in satisfaction of the foregoingrequirement allow a Participant to elect to have the Company withhold shares of Stock otherwiseissuable under an Award (or allow the return of shares of Stock) having a Fair Market Value equalto the sums required to be withheld. Notwithstanding any other provision of the Plan, the numberof shares of Stock which may be withheld with respect to the issuance, vesting, exercise or paymentof any Award (or which may be repurchased from the Participant of such Award within six months (orsuch other period as may be determined by the Committee) after such shares of Stock were acquiredby the Participant from the Company) in order to satisfy the Participant’s federal, state, localand foreign income and payroll tax liabilities with respect to the issuance, vesting, exercise orpayment of the Award shall be limited to the number of shares which have a Fair Market Value on thedate of withholding or repurchase equal to the aggregate amount of such liabilities based on theminimum statutory withholding rates for federal, state, local and foreign income tax and payrolltax purposes that are applicable to such supplemental taxable income.     15.4 No Right to Employment or Services. Nothing in the Plan or any Award Agreementshall interfere with or limit in any way the right of the Company or any Subsidiary to terminateany Participant’s employment or services at any time, nor confer upon any Participant any right tocontinue in the employ or service of the Company or any Subsidiary.     15.5 Unfunded Status of Awards. The Plan is intended to be an “unfunded” plan forincentive compensation. With respect to any payments not yet made to a Participant pursuant to
20

 
an Award, nothing contained in the Plan or any Award Agreement shall give the Participant anyrights that are greater than those of a general creditor of the Company or any Subsidiary.     15.6 Indemnification. To the extent allowable pursuant to applicable law, each memberof the Committee or of the Board shall be indemnified and held harmless by the Company from anyloss, cost, liability, or expense that may be imposed upon or reasonably incurred by such member inconnection with or resulting from any claim, action, suit, or proceeding to which he or she may bea party or in which he or she may be involved by reason of any action or failure to act pursuant tothe Plan and against and from any and all amounts paid by him or her in satisfaction of judgment insuch action, suit, or proceeding against him or her; *provided*he or she gives the Company anopportunity, at its own expense, to handle and defend the same before he or she undertakes tohandle and defend it on his or her own behalf. The foregoing right of indemnification shall not beexclusive of any other rights of indemnification to which such persons may be entitled pursuant tothe Company’s Certificate of Incorporation or Bylaws, as a matter of law, or otherwise, or anypower that the Company may have to indemnify them or hold them harmless.     15.7 Relationship to other Benefits. No payment pursuant to the Plan shall be takeninto account in determining any benefits pursuant to any pension, retirement, savings, profitsharing, group insurance, welfare or other benefit plan of the Company or any Subsidiary except tothe extent otherwise expressly provided in writing in such other plan or an agreement thereunder.     15.8 Expenses. The expenses of administering the Plan shall be borne by the Companyand its Subsidiaries.     15.9 Titles and Headings. The titles and headings of the Sections in the Plan are forconvenience of reference only and, in the event of any conflict, the text of the Plan, rather thansuch titles or headings, shall control.     15.10 Fractional Shares. No fractional shares of Stock shall be issued and theCommittee shall determine, in its discretion, whether cash shall be given in lieu of fractionalshares or whether such fractional shares shall be eliminated by rounding up or down as appropriate.     15.11 Limitations Applicable to Section 16 Persons. Notwithstanding any otherprovision of the Plan, the Plan, and any Award granted or awarded to any Participant who is thensubject to Section 16 of the Exchange Act, shall be subject to any additional limitations set forthin any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment toRule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule.To the extent permitted by applicable law, the Plan and Awards granted or awarded hereunder shallbe deemed amended to the extent necessary to conform to such applicable exemptive rule.     15.12 Government and Other Regulations. The obligation of the Company to make paymentof awards in Stock or otherwise shall be subject to all applicable laws, rules, and regulations,and to such approvals by government agencies as may be required. The Company
21

 
shall be under no obligation to register pursuant to the Securities Act of 1933, as amended,any of the shares of Stock paid pursuant to the Plan. If the shares paid pursuant to the Plan mayin certain circumstances be exempt from registration pursuant to the Securities Act of 1933, asamended, the Company may restrict the transfer of such shares in such manner as it deems advisableto ensure the availability of any such exemption.     15.13 Section 409A. To the extent that the Committee determines that any Awardgranted under the Plan is subject to Section 409A of the Code, the Award Agreement evidencing suchAward shall incorporate the terms and conditions required by Section 409A of the Code. To theextent applicable, the Plan and Award Agreements shall be interpreted in accordance with Section409A of the Code and Department of Treasury regulations and other interpretive guidance issuedthereunder, including without limitation any such regulations or other guidance that may be issuedafter the Effective Date. Notwithstanding anything to the contrary in Section 14.2 or any otherprovision of the Plan, in the event that following the Effective Date the Committee determines thatany Award may be subject to Section 409A of the Code and related Department of Treasury guidance(including such Department of Treasury guidance as may be issued after the Effective Date), theCommittee may adopt such amendments to the Plan and the applicable Award Agreement or adopt otherpolicies and procedures (including amendments, policies and procedures with retroactive effect), ortake any other actions, that the Committee determines are necessary or appropriate to (a) exemptthe Award from Section 409A of the Code and/or preserve the intended tax treatment of the benefitsprovided with respect to the Award, or (b) comply with the requirements of Section 409A of the Codeand related Department of Treasury guidance.     15.14 Governing Law. The Plan and all Award Agreements shall be construed inaccordance with and governed by the laws of the State of Delaware.* * * * *     I hereby certify that the foregoing Plan was duly adopted by the Board of Directors of Volcom,Inc. on February 6, 2007.* * * * *     I hereby certify that the Original Plan was approved by the stockholders of Volcom, Inc. onJune 14, 2005.     Executed on this 6th day of February, 2007.                                            /s/ S. Hoby Darling   Assistant Corporate Secretary      
22