exv10w4






 





Exhibit 10.4



 




    2007
    Incentive Compensation Plan, as amended



 


		
	
    1.  
	
    Purpose




 



    The purpose of this 2007 Incentive Compensation Plan (the
    “Plan”) is to advance the long-term interests of OM
    Group, Inc. (the “Corporation”) by



 



    (i) motivating key personnel by means of incentive
    compensation,



 



    (ii) furthering the identity of interests of participants
    with those of the stockholders of the Corporation through the
    ownership and performance of the common stock of the
    Corporation, and



 



    (iii) permitting the Corporation to attract and retain key
    personnel and directors whose judgment is important to the
    successful conduct of the business of the Corporation.



 



    Toward this objective, the Committee may grant awards to key
    personnel of the Corporation and its subsidiaries and to
    non-employee directors of the Corporation, on the terms and
    subject to the conditions set forth in this Plan.



 


		
	
    2.  
	
    Definitions




 



    2.1  “Award” means any form of stock option,
    stock appreciation right, restricted stock award, phantom stock
    or restricted stock unit award, or performance bonus granted
    pursuant to the provisions of this Plan.



 



    2.2  “Award Agreement” means a written
    document evidencing an Award granted pursuant to this Plan and
    establishing the terms, conditions, restrictions and limitations
    applicable to such Award. To the extent an Award Agreement is
    inconsistent with the terms of this Plan, this Plan shall govern
    the rights of the Participant.



 



    2.3  “Board” means the Board of Directors of
    the Corporation.



 



    2.4  “Change in Control” means any one or
    more of the following:



 



    (i) The Corporation is merged, consolidated or reorganized
    into or with another corporation or other legal person, and
    immediately after such merger, consolidation or reorganization
    less than fifty percent (50%) of the combined voting power of
    the then-outstanding securities of such corporation or person
    immediately after such transaction are held directly or
    indirectly in the aggregate by the holders of voting shares of
    the Corporation immediately prior to such transaction;



 



    (ii) The Corporation sells all or substantially all of its
    assets to any other corporation or other legal person, and less
    than fifty percent (50%) of the combined voting power of the
    then-outstanding securities of such corporation or person
    immediately after such sale are held directly or indirectly in
    the aggregate by the holders of voting shares of the Corporation
    immediately prior to such sale;



 



    (iii) Any person or group of persons (as the term
    “person” is used in Section 13(d)(3) or
    Section 14(d)(2) of the Exchange Act), becomes the
    beneficial owner (as the term “beneficial owner” is
    defined under
    Rule 13d-3
    or any successor rule or regulation promulgated under the
    Exchange Act) of securities (a) representing 50% or more of
    the issued and outstanding shares of the Corporation or
    (b) possessing the power to elect a majority of the Board
    of the Corporation, except that any acquisition directly from
    the Corporation, any acquisition by the Corporation, or any
    acquisition by any employee benefit plan (or related trust)
    sponsored or maintained by the Corporation or any Subsidiary
    shall not constitute a Change in Control;



 



    (iv) The Corporation files a report or proxy statement with
    the Securities and Exchange Commission pursuant to the Exchange
    Act disclosing in response to an item of
    Form 8-K
    or Schedule 14A (or any successor schedule, form or report
    or item therein) that a Change in Control of the Corporation has
    occurred;




    

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    (v) The stockholders of the Corporation approve the
    liquidation or dissolution of the Corporation; or



 



    (vi) If during any period of two consecutive years,
    individuals who at the beginning of any such period constitute
    the Board cease for any reason to constitute at least a majority
    of the Board, provided that each director who is first elected,
    or first nominated for election by the Corporation’s
    stockholders, by a vote of at least two-thirds of the directors
    of the Corporation (or a committee of the Board) then still in
    office who were directors of the Corporation at the beginning of
    any such period will be deemed to have been a director of the
    Corporation at the beginning of such period.



 



    Notwithstanding anything else in this Plan, a “Change in
    Control” shall not include any change for reasons of
    bankruptcy, insolvency, or otherwise for the benefit of the
    creditors of the Corporation or, if applicable, a Subsidiary of
    the Corporation.



 



    2.5  “Change in Control Price” means the
    higher of (i) the mean of the high and low trading prices
    for the Corporation’s Common Stock on the Stock Exchange on
    the date of the Change in Control or (ii) the highest price
    per share actually paid for the Common Stock in connection with
    the Change in Control of the Corporation.



 



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



 



    2.7  “Committee” means the Compensation
    Committee of the Board, or such other committee designated by
    the Board, authorized to administer the Plan, composed of not
    fewer than two directors, each of whom shall be “a
    Non-Employee Director” under
    Rule 16b-3
    of the Exchange Act or any successor rule or statute and shall
    be an “outside director” for purposes of
    Section 162(m) of the Code or any successor rule or statute.



 



    2.8  “Common Stock” means common stock, par
    value $.01, of the Corporation.



 



    2.9  “Exchange Act” means the Securities
    Exchange Act of 1934, as amended.



 



    2.10  “Key Employee” means an employee of
    the Corporation or a Subsidiary who holds a position of
    responsibility in a managerial, administrative or professional
    capacity and whose performance, as determined by the Committee
    in the exercise of its sole and absolute discretion, makes
    appropriate the grant of an Award under this Plan.



 



    2.11  “Non-Employee Director” means any
    director of the Corporation who is not an employee of the
    Corporation.



 



    2.12  “Participant” means any individual to
    whom an Award has been granted by the Committee under this Plan.



 



    2.13  “Stock Exchange” means the New York
    Stock Exchange or, if the Common Stock is no longer traded on
    the New York Stock Exchange, such other market price reporting
    system on which the Common Stock is traded or quoted and is
    designated by the Committee after it determines that such other
    exchange is both reliable and reasonably accessible.



 



    2.14  “Subsidiary” means a corporation or
    other business entity in which the Corporation directly or
    indirectly has an ownership interest of fifty percent or more.



 


		
	
    3.  
	
    Administration




 



    The Plan shall be administered by the Committee except as
    otherwise expressly provided in this Plan. Subject to the
    express provisions of this Plan, the Committee shall have the
    conclusive authority to construe and interpret this Plan and any
    Award Agreement under this Plan and to establish, amend and
    rescind policies and procedures for the administration of this
    Plan and shall have such additional authority as the Board may
    from time to time determine to be necessary or desirable.



 



    In addition, in order to enable employees who are foreign
    nationals or employed outside the United States, or both, to
    receive Awards under this Plan, the Committee may adopt such
    policies and subplans as are necessary or advisable, in the
    opinion of the Committee, to effectuate the purposes of the Plan.




    

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    4.  
	
    Eligibility




 



    Any Key Employee or Non-Employee Director is eligible to become
    a Participant in this Plan.



 


		
	
    5.  
	
    Available
    Shares




 



    5.1  Aggregate Number of Shares.  The
    aggregate number of shares of Common Stock of the Corporation as
    to which Awards may be made under this Plan (including any
    annual stock issuances made to Non-Employee Directors pursuant
    to Section 11) shall be 3,000,000, subject to
    adjustment as provided in this Plan. Such shares may be made
    available from authorized and unissued shares of the Corporation
    or from shares that have been reacquired by the Corporation and
    held as treasury shares.



 



    Notwithstanding the foregoing, subject to adjustment as provided
    in this Plan,



 



    (i) the number of shares subject to Awards made to any one
    person in any calendar year shall not exceed 250,000; and



 



    (ii) the total number of shares subject to Awards that are
    other than stock option and stock appreciation rights Awards
    made under this Plan shall not exceed 1,500,000.



 



    5.2  Shares Covered by
    Awards.  For purposes of calculating the number of
    shares of Common Stock deemed to be granted under this Plan,
    each Award, in whatever form, shall be deemed to be a grant of a
    number of shares of Common Stock equal to the number of shares
    represented by the stock options, stock appreciation rights,
    shares of restricted stock, shares of phantom stock or
    restricted stock units set forth in the Award, except that:



 



    (i) in the case of any Award as to which the exercise of
    one right nullifies the exercisability of another, the number of
    shares deemed to have been granted shall be the maximum number
    of shares (and/or cash equivalents) that could have been
    acquired upon the maximum exercise or settlement of the
    Award; and



 



    (ii) in the case of any performance-based restricted stock
    Award that provides for payments in excess of 100% of the number
    of shares set forth in the Award Agreement, the number of shares
    granted shall be deemed to be the maximum number of shares
    (and/or the cash equivalent) issuable under the Award at the
    highest level of performance.



 



    5.3  Use and Re-grant Availability of
    Shares.  For purposes of calculating the number of
    shares of Common Stock available for Awards under this Plan,



 



    (i) any Award or portion of an Award that has been settled
    by the payment of cash shall be deemed to have used the number
    of shares covered by the Award; and



 



    (ii) any shares subject to any Award that is forfeited or
    otherwise terminated without the issuance of shares or payment
    of other consideration shall again be available for issuance
    under this Plan.



 


		
	
    6.  
	
    Participation




 



    The Committee shall select, from time to time, those Key
    Employees and Non-Employee Directors who shall be Participants
    in the Plan and shall determine the type or types of Awards to
    be made to each Participant. The terms, conditions and
    restrictions of each Award shall be set forth in an Award
    Agreement in a form approved by the Committee.



 


		
	
    7.  
	
    Stock
    Options




 



    7.1  Grants.  Awards may be granted
    in the form of stock options. Stock options may be incentive
    stock options within the meaning of Section 422 of the Code
    or non-statutory stock options (i.e., stock options that are not
    incentive stock options), or a combination of both, or any
    particular type of tax-advantaged option authorized by the Code
    from time to time.




    

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    7.2  Terms and Conditions of
    Options.  An option shall be exercisable in whole
    or in such installments and at such times as may be determined
    by the Committee, provided that no stock option shall be
    exercisable more than ten years after the date of grant. The
    exercise price of a stock option shall be established by the
    Committee, but such price shall not be less than the per share
    fair market value of the Common Stock, as determined by the
    Committee, on the date of the grant of the stock option, subject
    to adjustment as provided in Sections 17 and 18.



 



    7.3  Restrictions Relating to Incentive Stock
    Options.  Stock options issued in the form of
    incentive stock options shall, in addition to being subject to
    all applicable terms, conditions, restrictions and limitations
    established by the Committee, comply with Section 422 of
    the Code. Incentive stock options shall be granted only to
    full-time employees of the Corporation and its Subsidiaries
    within the meaning of Section 424 of the Code. The
    aggregate fair market value (determined as of the date the
    option is granted) of shares with respect to which incentive
    stock options are exercisable for the first time by an
    individual during any calendar year (under this Plan or any
    other plan of the Corporation or any Subsidiary that provides
    for the granting of incentive stock options) may not exceed
    $100,000 or such other number as may be applicable under the
    Code from time to time. Any incentive stock option that is
    granted to any employee who is, at the time the option is
    granted, deemed for purposes of Section 422 of the Code or
    any successor provision, to own shares of the Corporation
    possessing more than ten percent of the total combined voting
    power of all classes of shares of the Corporation or of a parent
    or subsidiary of the Corporation, shall have an option exercise
    price that is at least 110% of the fair market value of the
    shares at the date of grant and shall not be exercisable after
    the expiration of five years from the date it is granted.



 



    7.4  Additional Terms and
    Conditions.  The Board may, in the Award Agreement
    or otherwise, establish such other terms, conditions,
    restrictions or limitations on any stock option Award as it
    considers appropriate, provided they are not inconsistent with
    this Plan, including provisions relating to:



 



    (i) the vesting of such option;



 



    (ii) payments to be made by the Participant at the time of
    exercise of such option relating to any taxes associated with
    such exercise;



 



    (iii) any requirement imposed on the Participant to retain
    the Common Stock acquired upon exercise of such option; and



 



    (iv) the exercisability of such options upon the cessation
    of employment or service as a director.



 



    7.5  Payment.  Upon exercise, a
    participant may pay the exercise price of a stock option in cash
    or shares of Common Stock, or a combination of cash and shares
    of Common Stock, or such other consideration as the Committee
    may deem appropriate. The Committee shall establish appropriate
    methods for accepting Common Stock and may impose such
    conditions as it deems appropriate on the use of such Common
    Stock to exercise a stock option.



 


		
	
    8.  
	
    Stock
    Appreciation Rights




 



    8.1  Grants.  Awards may be granted
    in the form of stock appreciation rights (“SARs”).
    SARs shall entitle the recipient to receive a payment equal to
    the appreciation in market value of a stated number of shares of
    Common Stock from the price stated in the Award Agreement (which
    price may not be less than the fair market value of the Common
    Stock on the date of grant of the SAR) to the market value of
    the Common Stock on the date of exercise or surrender. An SAR
    may be granted in tandem with all or a portion of a related
    stock option under the Plan (“Tandem SARs”) or may be
    granted separately (“Freestanding SARs”).



 



    8.2  Terms and Conditions of Tandem
    SARs.  Subject to the limitations contained in the
    preceding paragraph, a Tandem SAR shall be exercisable to the
    extent, and only to the extent, that the related stock option is
    exercisable. Upon exercise of a Tandem SAR as to some or all of
    the shares covered by an Award, the related stock option shall
    be cancelled automatically to the extent of the number of SARs
    exercised, and such shares shall not be eligible for re-grant
    under this Plan.




    

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    8.3  Terms and Conditions of Freestanding
    SARs.  Freestanding SARs shall be exercisable in
    whole or in such installments and at such times as may be
    determined by the Committee, provided that no Freestanding SAR
    shall be exercisable more than ten years after the date of
    grant. The base price of a Freestanding SAR also shall be
    determined by the Committee, provided that such price shall not
    be less that the fair market value of the Common Stock, as
    determined by the Committee, on the date of the grant of the
    Freestanding SAR.



 



    8.4  Deemed Exercise.  The Committee
    may provide that an SAR shall be deemed to be exercised at the
    close of business on the scheduled expiration date of such SAR,
    if at such time the SAR by its terms is otherwise exercisable
    and, if so exercised, would result in a payment to the
    Participant.



 



    8.5  Additional Terms and
    Conditions.  The Committee may, in the Award
    Agreement or otherwise, establish such other terms, conditions,
    restrictions or limitations on any SAR Award as it considers
    appropriate, provided that they are not inconsistent with this
    Plan.



 


		
	
    9.  
	
    Restricted
    Stock Awards




 



    9.1  Grants.  Awards may be granted
    in the form of restricted stock Awards, in such numbers and at
    such times as the Committee shall determine.



 



    9.2  Award Restrictions.  Restricted
    stock Awards shall be subject to such terms, conditions,
    restrictions or limitations as the Committee deems appropriate,
    provided they are not inconsistent with this Plan, including
    restrictions on vesting and transferability, forfeiture
    provisions, requirements of continued employment or service as a
    director, individual performance or the financial performance of
    the Corporation or a segment or identified business of the
    Corporation. Notwithstanding the foregoing, the vesting schedule
    for restricted stock Awards must at a minimum be (i) for
    three years for shares that vest based upon continued employment
    or service as a director, and (ii) for one year for shares
    that vest based upon the financial performance of the
    Corporation or a segment or identified business of the
    Corporation in accordance with performance criteria established
    by the Committee as described in Section 9.5 of this Plan.



 



    9.3  Rights as Shareholders.  During
    the period in which any shares of Common Stock are subject to
    any of the conditions, restrictions or limitations referenced in
    the preceding paragraph, the Committee may, in its discretion,
    grant to the Participant to whom such restricted shares have
    been awarded all or any of the rights of a stockholder with
    respect to such shares, including the right to vote such shares
    and to receive dividends paid on shares of Common Stock.



 



    9.4  Evidence of Award.  Any
    restricted stock Award granted under this Plan may be evidenced
    in such manner as the Committee deems appropriate, including
    book-entry registration or issuance of a stock certificate or
    certificates.



 



    9.5  Performance Criteria.  In the
    event that restricted stock Awards are granted subject to the
    financial performance of the Corporation, such restricted stock
    Awards shall be earned upon the satisfaction of such performance
    targets related to such performance periods as are established
    by the Committee at the time of grant. The Committee may
    establish performance targets in terms of any or all of the
    following:  sales, sales growth, gross margins,
    operating profit, operating profit growth, net income, net
    income growth, earnings per share, growth in earnings per share,
    EBITDA, cash flow per share, total stockholder returns, return
    on equity, return on invested capital, return on net assets
    employed, common stock price or common stock price appreciation.
    Performance targets may utilize various combinations of or
    changes in any of the above measures, or may utilize any one or
    more of the above measures as relates to an identified business
    or segment of the Corporation’s operations or as relates to
    the performance of the Corporation as compared to other
    entities. Performance targets applicable to restricted stock
    Awards may vary from Award to Award and from Participant to
    Participant. When determining whether performance targets have
    been attained, the Committee shall have the discretion to make
    adjustments to take into account extraordinary or nonrecurring
    items or events, or unusual nonrecurring gains or losses
    identified in the Corporation’s financial statements,
    provided such adjustments are made in a manner consistent with
    Section 162(m) of the Code (to the extent applicable). To
    the extent appropriate, restricted stock Awards that are made to
    Participants subject to Section 162(m) of




    

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    the Code are intended to qualify under Section 162(m) and
    the Committee shall interpret the terms of such Awards in a
    manner consistent with that intent.



 


		
	
    10.  
	
    Phantom
    Stock and Restricted Stock Units




 



    10.1  Grants.  Awards may be granted
    in the form of phantom stock or restricted stock unit Awards.
    Such Awards shall entitle the Participant to receive the market
    value or the appreciation in value of an equivalent number of
    shares of Common Stock on a settlement date determined by the
    Committee.



 



    10.2  Additional Terms and
    Conditions.  The Committee may, in the Award
    Agreement or otherwise, establish such other terms, conditions,
    restrictions or limitations on any Award of phantom stock or
    restricted stock units as it considers appropriate, provided
    they are not inconsistent with this Plan, including restrictions
    on vesting and transferability, forfeiture provisions,
    requirements of continued employment or service as a director,
    individual performance or the financial performance of the
    Corporation or a segment or identified business of the
    Corporation. Notwithstanding the foregoing, the minimum vesting
    schedule requirements set forth in Section 9.2 of this Plan
    shall apply to any time-based or performance-based phantom stock
    or restricted stock unit Awards. The provisions of
    Section 9.5 of this Plan shall be applicable to phantom
    stock or restricted stock unit Awards that are subject to the
    financial performance of the Corporation or a segment or
    identified business of the Corporation.



 


		
	
    11.  
	
    Annual
    Stock Issuance to Non-Employee Directors




 



    Each Non-Employee Director may receive all or any portion of his
    or her annual compensation as a Non-Employee Director in the
    form of Common Stock, as determined annually by the Board. The
    Board shall have the absolute discretion to determine the
    amount, if any, of Non-Employee Director annual compensation
    that shall be paid in the form of Common Stock in any year,
    which may vary from year to year. Any shares of Common Stock
    that are determined by the Board to be issuable pursuant to this
    Section shall be issued to Non-Employee Directors as promptly as
    practicable following the measurement date for any
    installment(s) of such annual compensation being paid in whole
    or in part in Common Stock, as determined by the Board. The
    measurement date should be the last business day of the relevant
    quarter for which compensation is being paid in Common Stock,
    and for purposes of determining the number of shares of Common
    Stock to be issued, shares shall be valued at the average of the
    high and low sale price of Common Stock on the New York Stock
    Exchange on the applicable measurement date for such installment
    or installments. No fractional shares of Common Stock shall be
    issued, and any fractional shares so calculated shall be paid in
    cash. No Award Agreement need be executed with respect to any
    stock issuances to Non-Employee Directors pursuant to this
    Section.



 


		
	
    12.  
	
    Annual
    Incentive Awards




 



    The Committee is responsible for administering the annual
    incentive program of the Corporation, which provides annual
    bonus opportunities to certain employees of the Corporation and
    its Subsidiaries. The Committee shall select, from time to time,
    those employees of the Corporation and its Subsidiaries who
    shall participate in the annual incentive program for a
    particular year and shall determine the annual bonus opportunity
    available for each employee so selected. Annual bonus
    opportunities shall be based upon such factors and subject to
    such terms and conditions as shall be provided in the annual
    incentive program for a particular year, which may include
    satisfaction of corporate performance goals, segment or
    identified business performance goals and individual objectives.
    To the extent that annual bonus opportunities are determined for
    any employee to be subject to the financial performance of the
    Corporation or a segment or identified business of the
    Corporation (a “performance bonus”), such performance
    bonus shall be earned upon the satisfaction of such performance
    targets as are established by the Committee in its
    administration of the annual incentive program, which
    performance targets shall be one or more of the performance
    targets set forth in Section 9.5 of this Plan. The
    provisions of Section 9.5 of this Plan shall be applicable
    to annual bonus opportunities that are subject to the financial
    performance of the Corporation or a segment or identified
    business of the Corporation, such that performance bonus awards
    made to employees subject to Section 162(m) of the Code are
    intended to qualify under Section 162(m) to the extent
    appropriate. The Committee shall interpret the terms of such




    

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    awards in a manner consistent with that intent to the extent
    appropriate. The maximum dollar amount of any performance bonus
    payable to an employee in any calendar year is $10,000,000.



 


		
	
    13.  
	
    Payment
    of Awards




 



    Except as otherwise provided in this Plan, Award Agreements may
    provide that, at the discretion of the Committee, payment of
    Awards may be made in cash, Common Stock, a combination of cash
    and Common Stock, or any other form of property as the Committee
    shall determine. Further, the terms of Award Agreements may
    provide for payment of Awards in the form of a lump sum or
    installments, as determined by the Committee. All payments of
    Awards shall be made in a manner consistent with the
    requirements of Section 409A of the Code.



 


		
	
    14.  
	
    Dividends
    and Dividend Equivalents




 



    If an Award is granted in the form of a restricted stock Award
    or a phantom stock or restricted stock unit Award, the Committee
    may choose, at the time of the grant of the Award, to include as
    part of such Award an entitlement to receive dividends or
    dividend equivalents, subject to such terms, conditions,
    restrictions or limitations as the Committee may establish.
    Dividends and dividend equivalents shall be paid in such form
    and manner and at such times as the Committee shall determine.
    All dividends or dividend equivalents that are not paid
    currently may, at the Committee’s discretion, accrue
    interest or be reinvested into additional shares of Common Stock.



 


		
	
    15.  
	
    Termination
    of Employment or Service as Director




 



    The Committee may adopt administrative policies and procedures
    and/or
    provide in Award Agreements with respect to the rights under an
    Award of a Participant who ceases to be employed by either the
    Corporation or a Subsidiary or ceases to be a director of the
    Corporation, whether because of death, disability, resignation,
    termination or retirement pursuant to an established retirement
    plan or policy of the Corporation or of the applicable
    Subsidiary. All such administrative policies and procedures
    shall comply with the requirements of Section 409A of the
    Code.



 


		
	
    16.  
	
    Assignment
    and Transfer




 



    The rights and interests of a Participant under the Plan or an
    Award may not be assigned, encumbered or transferred other than,
    in the event of the death of a Participant, by will or the laws
    of descent and distribution, or other than in accordance with a domestic relations order or comparable order that is issued and is applicable to the Participant.



 


		
	
    17.  
	
    Adjustments
    Upon Changes in Capitalization




 



    In the event of any change in the outstanding shares of Common
    Stock by reason of any reorganization, recapitalization, stock
    split, stock dividend, combination or exchange of shares,
    merger, consolidation or any change in the corporate structure
    or shares of the Corporation, the maximum aggregate number and
    class of shares as to which Awards may be granted under the Plan
    (as well as the limitations upon the number of shares that may
    be the subject of Awards to any individual in a calendar year
    and the aggregate number of shares subject to Awards other than
    stock options and SARs) and the number and class of shares
    issuable pursuant to then-outstanding Awards (together with the
    exercise price of any outstanding stock option or SAR) shall be
    appropriately adjusted by the Committee, whose determination
    shall be final.



 


		
	
    18.  
	
    Extraordinary
    Distributions and Pro Rata Repurchases




 



    In the event the Corporation shall at any time when an Award is
    outstanding make an Extraordinary Distribution (as defined
    below) in respect of Common Stock or effect a Pro Rata
    Repurchase of Common Stock (as defined below), the Committee
    shall consider the economic impact of the Extraordinary
    Distribution or Pro Rata Repurchase on Participants and make
    such adjustments as it deems equitable under the circumstances.
    The determination of the Committee shall, subject to revision by
    the Board, be final and binding upon all Participants.




    

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    As used in this Plan, the term “Extraordinary
    Distribution” means any dividend or other distribution of



 



    (i) cash, where the aggregate amount of such cash dividend
    or distribution together with the amount of all cash dividends
    and distributions made during the preceding twelve months, when
    combined with the aggregate amount of all Pro Rata Repurchases
    (for this purpose, including only that portion of the aggregate
    purchase price of such Pro Rata Repurchases that is in excess of
    the fair market value of the Common Stock repurchased during
    such twelve-month period), exceeds ten percent of the aggregate
    fair market value of all shares of Common Stock outstanding on
    the record date for determining the stockholders entitled to
    receive such Extraordinary Distribution, or



 



    (ii) any shares of capital stock of the Corporation (other
    than shares of Common Stock), other securities of the
    Corporation, evidences of indebtedness of the Corporation or any
    other person or any other property (including shares of any
    Subsidiary of the Corporation), or any combination of such items.



 



    As used in this Plan, “Pro Rata Repurchase” means any
    purchase of shares of Common Stock by the Corporation or any
    Subsidiary pursuant to any tender offer or exchange offer,
    whether or not subject to Section 13(e) of the Exchange Act
    or any successor provision of law, or pursuant to any other
    offer available to substantially all holders of Common Stock,
    provided that no purchase of shares of Common Stock made by the
    Corporation or any Subsidiary in open market transactions shall
    be deemed to be a Pro Rata Repurchase.



 


		
	
    19.  
	
    Withholding
    Taxes




 



    The Corporation or the applicable Subsidiary shall be entitled
    to deduct from any payment under this Plan, regardless of the
    form of such payment, the amount of all applicable income and
    employment taxes required by law to be withheld with respect to
    such payment or may require the Participant to pay to it such
    taxes prior to and as a condition of the making of such payment.
    The Committee may allow a Participant to pay the amount of taxes
    required by law to be withheld from an Award by withholding from
    any payment of Common Stock due as a result of such Award, or by
    permitting the Participant to deliver to the Corporation, shares
    of Common Stock having a fair market value, as determined by the
    Committee, equal to the amount of such required withholding
    taxes.



 


		
	
    20.  
	
    Noncompetition
    Provision




 



    Unless the Award Agreement specifies otherwise, a Participant
    shall forfeit all unexercised, unearned or unvested Awards if



 



    (i) in the opinion of the Committee, the Participant,
    without the written consent of the Corporation, engages directly
    or indirectly in any manner or capacity as principal, agent,
    partner, officer, director, employee or otherwise in any
    business or activity competitive with the business conducted by
    the Corporation or any Subsidiary; or



 



    (ii) the Participant performs any act or engages in any
    activity that in the opinion of the Committee is detrimental to
    the best interests of the Corporation.



 


		
	
    21.  
	
    Regulatory
    Approvals and Listings




 



    Notwithstanding anything contained in this Plan to the contrary,
    the Corporation shall have no obligation to issue or deliver
    certificates of Common Stock evidencing restricted stock Awards
    or any other Award payable in Common Stock prior to



 



    (i) the obtaining of any approval from any governmental
    agency that the Corporation shall, in its sole discretion,
    determine to be necessary or advisable,



 



    (ii) the admission of such shares to listing on the Stock
    Exchange, and



 



    (iii) the completion of any registration or other
    qualification of such shares under any state or federal law or
    ruling of any governmental body that the Corporation shall, in
    its sole discretion, determine to be necessary or advisable.




    

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    22.  
	
    No Right
    to Continued Employment or Grants




 



    Participation in this Plan shall not give any Key Employee any
    right to remain in the employ of the Corporation or any
    Subsidiary. The Corporation or, in the case of employment with a
    Subsidiary, the Subsidiary, reserves the right to terminate the
    employment of any Key Employee at any time. The adoption of this
    Plan shall not be deemed to give any Key Employee or any other
    individual any right to be selected as a Participant, to be
    granted any Awards under this Plan or if granted an Award in any
    year, to receive Awards in any subsequent year.



 


		
	
    23.  
	
    Amendment




 



    The Board reserves the right to amend, suspend or terminate this
    Plan at any time, subject to any applicable requirements for
    stockholder approval imposed by the Stock Exchange or any law or
    regulation. The Committee may amend the terms of any outstanding
    Award, but no such amendment may impair the rights of any
    Participant without his or her consent or amend the terms of any
    Award that is intended to qualify as performance-based
    compensation under Section 162(m) of the Code so as to
    increase the amount otherwise payable under the Award.



 


		
	
    24.  
	
    Governing
    Law




 



    The Plan shall be governed by and construed in accordance with
    the laws of the State of Ohio.



 


		
	
    25.  
	
    Change in
    Control




 



    25.1  Stock Options.  In the event of
    a Change in Control, stock options not otherwise exercisable at
    the time of the Change in Control shall become fully exercisable
    upon such Change in Control.



 



    25.2  Stock Appreciation Rights.  In
    the event of a Change in Control, Tandem SARs not otherwise
    exercisable at the time of the Change in Control shall become
    exercisable to the extent that the related Stock Option is
    exercisable. Freestanding SARs not otherwise exercisable at the
    time of a Change in Control also shall become fully exercisable
    upon such Change in Control. In the event of a Change in Control:



 



    (i) the Corporation shall make payment to Participants with
    respect to SARs in cash in an amount equal to the appreciation
    in the value of the SAR from the base price specified in the
    Award Agreement to the Change in Control Price;



 



    (ii) such cash payments to Participants shall be due and
    payable, and shall be paid by the Corporation, immediately upon
    the occurrence of such Change in Control; and



 



    (iii) after the payment provided for in (ii) above,
    Participants shall have no further rights under SARs outstanding
    at the time of such Change in Control.



 



    25.3  Restricted Stock Awards.  In
    the event of a Change in Control, all restrictions and
    conditions (including performance targets, at the target level)
    previously established with respect to restricted stock Awards
    shall conclusively be deemed to have been satisfied.
    Participants shall be entitled to have issued to them the shares
    of Common Stock described in the applicable Award Agreements,
    free and clear of any restriction or restrictive legend, except
    that if upon the advice of counsel to the Corporation, shares of
    Common Stock cannot lawfully be issued without restriction, then
    the Corporation shall make payment to Participants in cash in an
    amount equal to the Change in Control Price of the Common Stock
    that otherwise would have been issued. In such event:



 



    (i) such cash payments to Participants shall be due and
    payable, and shall be paid by the Corporation, immediately upon
    the occurrence of such Change in Control; and



 



    (ii) after the payment provided for in (i) above,
    Participants shall have no further rights under restricted stock
    Awards outstanding at the time of such Change in Control.




    

    A-9








 





 



    25.4  Phantom Stock or Restricted Stock
    Units.  In the event of a Change in Control:



 



    (i) all restrictions and conditions (including any
    performance targets, at the target level) previously established
    with respect to phantom stock or restricted stock unit Awards
    shall conclusively be deemed to have been satisfied and
    Participants shall be entitled to receive cash in satisfaction
    of their rights under phantom stock or restricted stock unit
    Awards in accordance with the amounts otherwise payable by the
    Corporation pursuant to the Award Agreement;



 



    (ii) such cash payments to Participants shall be due and
    payable, and shall be paid by the Corporation, immediately upon
    the occurrence of such Change in Control; and



 



    (iii) after the payment provided for in (ii) above,
    Participants shall have no further rights under phantom stock or
    restricted stock unit Awards outstanding at the time of such
    Change in Control.



 



    25.5  Annual Incentive Awards.  To
    the extent that the Committee has determined bonus opportunities
    for employees under the annual incentive program of the
    Corporation based upon the financial performance of the
    Corporation or a segment or identified business of the
    Corporation, in the event of a Change in Control, all
    performance targets shall conclusively be deemed to have been
    satisfied at the target level. In addition, all individual
    objectives related to bonus opportunities shall conclusively be
    deemed to have been satisfied. In the event of a Change in
    Control:



 



    (i) employees participating in the annual incentive program
    shall be entitled to receive payment of bonuses on the basis
    described above, and such bonuses shall be paid by the
    Corporation immediately upon the occurrence of such Change in
    Control; and



 



    (ii) after the payment provided for in (i) above, such
    employees shall have no further rights to bonus payments under
    such annual incentive plan.



 



    25.6  Miscellaneous.  Upon a Change
    in Control, no action shall be taken that would adversely affect
    the rights of any Participant or the operation of this Plan with
    respect to any Award to which the Participant may have become
    entitled under this Plan on or prior to the date of the Change
    in Control or to which the Participant may become entitled as a
    result of such Change in Control.



 


		
	
    26.  
	
    No Rights
    as Stockholder or Interest in Corporation Assets




 



    No Participant shall have any rights as a stockholder as a
    result of participation in this Plan except as provided in this
    Plan. To the extent any person acquires a right to receive
    payments from the Corporation under this Plan, such rights shall
    be no greater than the rights of an unsecured creditor of the
    Corporation.



 


		
	
    27.  
	
    Payment
    by Subsidiaries




 



    Settlement of Awards to employees of Subsidiaries shall be made
    by and at the expense of such Subsidiary. Except as prohibited
    by law, if any portion of an Award is to be settled in shares of
    Common Stock, the Corporation shall sell and transfer to the
    Subsidiary, and the Subsidiary shall purchase, the number of
    shares necessary to settle that portion of the Award.



 


		
	
    28.  
	
    Term of
    Plan




 



    This Plan shall become effective upon adoption of the Plan by
    the Board, provided that such effectiveness shall be subject to
    the approval of the stockholders of the Corporation. Awards may
    be granted under this Plan at any time prior to ten years from
    the adoption of the Plan by the Board, at which time the Plan
    shall expire but without affecting any Awards then outstanding.




    

    A-10