EXHIBIT 10.D



 











Exhibit 10(d)



Arrow Electronics, Inc.



2004 Omnibus Incentive Plan




Table of Contents



	 	 	 	 	 	 	 
					Page
					

	
    
    Article 1.
    

    	 	
    Establishment, Purpose, and Duration
    	 	 	A-2	 
	
    
    Article 2.
    

    	 	
    Definitions
    	 	 	A-2	 
	
    
    Article 3.
    

    	 	
    Administration
    	 	 	A-5	 
	
    
    Article 4.
    

    	 	
    Shares Subject to the Plan and Maximum Awards
    	 	 	A-6	 
	
    
    Article 5.
    

    	 	
    Eligibility and Participation
    	 	 	A-10	 
	
    
    Article 6.
    

    	 	
    Stock Options
    	 	 	A-10	 
	
    
    Article 7.
    

    	 	
    Stock Appreciation Rights
    	 	 	A-12	 
	
    
    Article 8.
    

    	 	
    Restricted Stock and Restricted Stock Units
    	 	 	A-14	 
	
    
    Article 9.
    

    	 	
    Performance Units/ Performance Shares
    	 	 	A-15	 
	
    
    Article 10.
    

    	 	
    Cash-Based Awards and Other Stock-Based Awards
    	 	 	A-16	 
	
    
    Article 11.
    

    	 	
    Performance Measures
    	 	 	A-17	 
	
    
    Article 12.
    

    	 	
    Covered Employee Annual Incentive Award
    	 	 	A-19	 
	
    
    Article 13.
    

    	 	
    Non-Employee Director Awards
    	 	 	A-19	 
	
    
    Article 14.
    

    	 	
    Dividend Equivalents
    	 	 	A-21	 
	
    
    Article 15.
    

    	 	
    Beneficiary Designation
    	 	 	A-22	 
	
    
    Article 16.
    

    	 	
    Deferrals
    	 	 	A-22	 
	
    
    Article 17.
    

    	 	
    Rights of Participants
    	 	 	A-22	 
	
    
    Article 18.
    

    	 	
    Corporate Events
    	 	 	A-23	 
	
    
    Article 19.
    

    	 	
    Amendment, Modification, Suspension, and
    Termination
    	 	 	A-23	 
	
    
    Article 20.
    

    	 	
    Withholding
    	 	 	A-24	 
	
    
    Article 21.
    

    	 	
    Successors
    	 	 	A-24	 
	
    
    Article 22.
    

    	 	
    General Provisions
    	 	 	A-24	 












 




Arrow Electronics, Inc.



2004 Omnibus Incentive Plan




Article 1.     Establishment,
Purpose, and Duration


     
1.1     Establishment.
Arrow Electronics, Inc., a New York corporation (hereinafter
referred to as the “Company”), establishes an
incentive compensation plan to be known as the 2004 Omnibus
Incentive Plan (hereinafter referred to as the
“Plan”), as set forth in this document.



     
The Plan permits the grant of Cash-Based Awards,
Non-Qualified Stock Options, Incentive Stock Options, Stock
Appreciation Rights, Restricted Stock, Restricted Stock Units,
Performance Shares, Performance Units, Covered Employee Annual
Incentive Awards, and Other Stock-Based Awards.



     
The Plan shall become effective upon shareholder
approval (the “Effective Date”) and shall remain in
effect as provided in Section 1.3 hereof.



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



     
1.3     Duration of
the Plan. Unless sooner terminated as
provided herein, the Plan shall terminate ten years from the
Effective Date. After the Plan is terminated, no Awards may be
granted but Awards previously granted shall remain outstanding
in accordance with their applicable terms and conditions and the
Plan’s terms and conditions. Notwithstanding the foregoing,
no Incentive Stock Options may be granted more than ten years
after the earlier of (a) adoption of the Plan by the Board,
and (b) the Effective Date.




Article 2.     Definitions


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




			
	 	2.1	
    “Affiliate”
    shall have the meaning ascribed to such term in Rule 12b-2
    of the General Rules and Regulations of the Exchange Act.
    
	 
	 	2.2	
    “Annual Award Limit” or “Annual
    Award Limits” have the meaning
    set forth in Section 4.3.
    
	 
	 	2.3	
    “Award”
    means, individually or collectively, a grant under this Plan of
    Cash-Based Awards, Non-Qualified Stock Options, Incentive Stock
    Options, SARs, Restricted Stock, Restricted Stock Units,
    Performance Shares, Performance Units, Covered Employee Annual
    Incentive Awards, or Other Stock-Based Awards, in each case
    subject to the terms of this Plan.
    




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	 	2.4	
    “Award
    Agreement” means either
    (i) a written agreement entered into by the Company and a
    Participant setting forth the terms and provisions applicable to
    an Award granted under this Plan, or (ii) a written
    statement issued by the Company to a Participant describing the
    terms and provisions of such Award.
    
	 
	 	2.5	
    “Beneficial
    Owner” or “Beneficial
    Ownership” shall have the meaning ascribed to such term
    in Rule 13d-3 of the General Rules and Regulations under
    the Exchange Act.
    
	 
	 	2.6	
    “Board” or
    “Board of Directors” means the Board of
    Directors of the Company.
    
	 
	 	2.7	
    “Cash-Based
    Award” means an Award granted to
    a Participant as described in Article 10.
    
	 
	 	2.8	
    “Code”
    means the U.S. Internal Revenue Code of 1986, as amended
    from time to time.
    
	 
	 	2.9	
    “Committee”
    means the compensation committee of the Board or any other
    committee designated by the Board to administer this Plan. The
    members of the Committee shall be appointed from time to time
    and shall serve at the discretion of the Board.
    





			
	 	2.10	
    “Company”
    means Arrow Electronics, Inc., a New York corporation, and any
    successor thereto as provided in Article 21 herein.
    
	 
	 	2.11	
    “Covered
    Employee” means a Participant:
    (a) who is a “covered employee,” as defined in
    Code Section 162(m) and the regulations promulgated under
    Code Section 162(m), or any successor statute or
    (b) who the Committee determines could potentially become a
    covered employee during the lifetime of an Award.
    
	 
	 	2.12	
    “Covered Employee Annual Incentive
    Award” means an Award granted to
    a Covered Employee as described in Article 12.
    
	 
	 	2.13	
    “Director”
    means any individual who is a member of the Board of Directors
    of the Company.
    
	 
	 	2.14	
    “Disability”
    means total and permanent disability as determined by the
    Committee.
    
	 
	 	2.15	
    “Effective
    Date” has the meaning set forth
    in Section 1.1.
    
	 
	 	2.16	
    “Employee”
    means any employee of the Company, its Affiliates, and/or
    Subsidiaries.
    
	 
	 	2.17	
    “Exchange
    Act” means the Securities
    Exchange Act of 1934, as amended from time to time, or any
    successor act thereto.
    
	 
	 	2.18	
    “Fair Market
    Value” or “FMV”
    means a price that is based on the opening, closing, actual,
    high, low, or average selling prices of a Share on the New York
    Stock Exchange (“NYSE”) or other established stock
    exchange (or exchanges) on the applicable date, the preceding
    trading days, the next succeeding trading day, or an average of
    trading days, as determined by the Committee in its discretion.
    Such definition(s) of FMV shall be determined by the Committee
    at its discretion. If, however, the required accounting
    standards used to account for equity Awards granted to
    Participants are substantially modified subsequent to the
    Effective Date of the Plan such that fair value accounting for
    such Awards becomes required, the Committee shall have the
    ability to determine an Award’s FMV based on the relevant
    facts and circumstances. If Shares are not traded on an
    established stock exchange, FMV shall be determined by the
    Committee based on objective criteria.
    




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	 	2.19	
    “Full Value
    Award” means an Award other than
    in the form of an ISO, NQSO, or SAR, and which is settled by the
    issuance of Shares.
    
	 
	 	2.20	
    “Freestanding
    SAR” means a SAR that is granted
    independently of any Options, as described in Article 7.
    
	 
	 	2.21	
    “Grant
    Price” means the price
    established at the time of grant of a SAR pursuant to
    Article 7, used to determine whether there is any payment
    due upon exercise of the SAR.
    
	 
	 	2.22	
    “Incentive Stock
    Option” or “ISO”
    means an Option to purchase Shares granted under Article 6
    to an Employee and that is designated as an Incentive Stock
    Option and that is intended to meet the requirements of Code
    Section 422, or any successor provision.
    
	 
	 	2.23	
    “Insider”
    shall mean an individual who is, on the relevant date, an
    officer, Director, or more than ten percent (10%) Beneficial
    Owner of any class of the Company’s equity securities that
    is registered pursuant to Section 12 of the Exchange Act,
    as determined by the Board in accordance with Section 16 of
    the Exchange Act.
    
	 
	 	2.24	
    “Non-Employee
    Director” means a Director who is
    not an Employee.
    
	 
	 	2.25	
    “Non-Employee Director
    Award” means any NQSO, SAR, or
    Full Value Award granted, whether singly, in combination, or in
    tandem, to a Participant who is a Non-Employee Director pursuant
    to such applicable terms, conditions, and limitations as the
    Board may establish in accordance with this Plan.
    
	 
	 	2.26	
    “Non-Qualified Stock
    Option” or
    “NQSO” means an Option that is not intended to
    meet the requirements of Code Section 422, or that
    otherwise does not meet such requirements.
    
	 
	 	2.27	
    “Option”
    means an Incentive Stock Option or a Non-Qualified Stock Option,
    as described in Article 6.
    
	 
	 	2.28	
    “Option
    Price” means the price at which a
    Share may be purchased by a Participant pursuant to an Option.
    
	 
	 	2.29	
    “Other Stock-Based
    Award” means an equity-based or
    equity-related Award not otherwise described by the terms of
    this Plan, granted pursuant to Article 10.
    
	 
	 	2.30	
    “Participant”
    means any eligible person as set forth in Article 5 to whom
    an Award is granted.
    
	 
	 	2.31	
    “Performance-Based
    Compensation” means compensation
    under an Award that satisfies the requirements of
    Section 162(m) of the Code for deductibility of
    remuneration paid to Covered Employees.
    
	 
	 	2.32	
    “Performance
    Measures” means measures as
    described in Article 11 on which the performance goals are
    based and which are approved by the Company’s shareholders
    pursuant to this Plan in order to qualify Awards as
    Performance-Based Compensation.
    
	 
	 	2.33	
    “Performance
    Period” means the period of time
    during which the performance goals must be met in order to
    determine the degree of payout and/or vesting with respect to an
    Award.
    




A-4








 




			
	 	2.34	
    “Performance
    Share” means an Award granted to
    a Participant, as described in Article 9.
    
	 
	 	2.35	
    “Performance
    Unit” means an Award granted to a
    Participant, as described in Article 9.
    
	 
	 	2.36	
    “Period of
    Restriction” means the period
    when Restricted Stock or Restricted Stock Units are subject to a
    substantial risk of forfeiture (based on the passage of time,
    the achievement of performance goals, or upon the occurrence of
    other events as determined by the Committee, in its discretion),
    as provided in Article 8.
    
	 
	 	2.37	
    “Person”
    shall have the meaning ascribed to such term in
    Section 3(a)(9) of the Exchange Act and used in
    Sections 13(d) and 14(d) thereof, including a
    “group” as defined in Section 13(d) thereof.
    
	 
	 	2.38	
    “Plan”
    means the Arrow Electronics, Inc. 2004 Omnibus Incentive Plan.
    
	 
	 	2.39	
    “Plan
    Year” means the calendar year.
    
	 
	 	2.40	
    “Prior
    Plans” means the Company’s
    Arrow Electronics, Inc. Stock Option Plan, as amended and
    restated effective as of February 27, 2002, the Arrow
    Electronics, Inc. Restricted Stock Plan, as amended and restated
    effective as of February 27, 2002, the Arrow Electronics,
    Inc. 2002 Non-Employee Directors Stock Option Plan, and the
    Non-Employee Directors Deferral Plan.
    
	 
	 	2.41	
    “Restricted
    Stock” means an Award granted to
    a Participant pursuant to Article 8.
    
	 
	 	2.42	
    “Restricted Stock
    Unit” means an Award granted to a
    Participant pursuant to Article 8, except no Shares are
    actually awarded to the Participant on the date of grant.
    
	 
	 	2.43	
    “Share”
    means a Share of common stock of the Company, $1.00 par value
    per Share.
    
	 
	 	2.44	
    “Stock Appreciation
    Right” or “SAR”
    means an Award, designated as a SAR, pursuant to the terms of
    Article 7 herein.
    
	 
	 	2.45	
    “Subsidiary”
    means any corporation or other entity, whether domestic or
    foreign, in which the Company has or obtains, directly or
    indirectly, a proprietary interest of more than fifty percent
    (50%) by reason of stock ownership or otherwise.
    
	 
	 	2.46	
    “Tandem
    SAR” means a SAR that is granted
    in connection with a related Option pursuant to Article 7
    herein, the exercise of which shall require forfeiture of the
    right to purchase a Share under the related Option (and when a
    Share is purchased under the Option, the Tandem SAR shall
    similarly be canceled).
    
	 
	 	2.47	
    “Third Party Service
    Provider” means any consultant,
    agent, advisor, or independent contractor who renders services
    to the Company, a Subsidiary, or an Affiliate that (a) are
    not in connection with the offer and sale of the Company’s
    securities in a capital raising transaction, and (b) do not
    directly or indirectly promote or maintain a market for the
    Company’s securities.
    





Article 3. Administration


     
3.1     General.
The Committee shall be responsible for administering the Plan,
subject to this Article 3 and the other provisions of the
Plan. The Committee may employ attorneys, consultants,



A-5








 




accountants, agents, and other persons, any of
whom may be an Employee, and the Committee, the Company, and its
officers and Directors shall be entitled to rely upon the
advice, opinions, or valuations of any such persons. All actions
taken and all interpretations and determinations made by the
Committee shall be final and binding upon the Participants, the
Company, and all other interested persons. The Committee shall
have the authority to bring an action in the name of the Company
in any court of competent jurisdiction to enforce, define or
defend any action or determination under the Plan.




     
3.2     Authority of
the Committee. Subject to the terms of
the Plan, the Committee shall have full and exclusive
discretionary power to interpret the terms and the intent of the
Plan and any Award Agreement or other agreement or document
ancillary to or in connection with the Plan, to determine
eligibility for Awards and to adopt such rules, regulations,
forms, instruments, and guidelines for administering the Plan as
the Committee may deem necessary or proper. Such authority shall
include, but not be limited to, selecting Award recipients,
establishing all Award terms and conditions, including the terms
and conditions set forth in Award Agreements, and, subject to
Article 19, adopting modifications and amendments to the
Plan or any Award Agreement, including without limitation, any
that are necessary to comply with the laws of the countries and
other jurisdictions in which the Company, its Affiliates, and/or
its Subsidiaries operate.



     
3.3     Delegation.
The Committee may delegate to one or more of its members or to
one or more officers of the Company, and/or its Subsidiaries and
Affiliates or to one or more agents or advisors such
administrative duties or powers as it may deem advisable, and
the Committee or any person to whom it has delegated duties or
powers as aforesaid may employ one or more persons to render
advice with respect to any responsibility the Committee or such
person may have under the Plan. The Committee may, by
resolution, authorize one or more officers of the Company to do
any of the following on the same basis as can the Committee:
(a) designate Employees to be recipients of Awards;
(b) designate Third Party Service Providers to be
recipients of Awards; and (c) determine the size of any
such Awards. The Committee shall not delegate such
responsibilities with respect to Awards granted to an officer
who is considered an Insider or Covered Employee. The resolution
providing for such delegation shall set forth the total number
of Awards such officer(s) may grant; and, the officer(s) shall
report periodically to the Committee regarding the nature and
scope of the Awards granted pursuant to the authority delegated.




Article 4.     Shares
Subject to the Plan and Maximum Awards



     4.1     Number
of Shares Available for Awards.



			
	 	(a)	
    Subject to adjustment as provided in
    Section 4.4 herein, the maximum number of Shares available
    for issuance to Participants under the Plan (the “Share
    Authorization”) shall be:
    





			
	 	(i)	
    Four million ninety six thousand eight hundred
    sixty nine (4,096,869) Shares; plus
    
	 
	 	(ii)	
    (a) four million two hundred three thousand one
    hundred thirty one (4,203,131) authorized Shares not issued or
    subject to outstanding awards under the Company’s Prior
    Plans as of the Effective Date and (b) any Shares subject
    to the eleven million three hundred sixty two thousand six
    hundred forty five (11,362,645) outstanding awards as of the
    Effective Date under the Prior Plans that on or after the
    Effective Date cease for any reason to be subject to such awards
    (other than by reason of
    




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    exercise or settlement of the awards to the
    extent they are exercised for or settled in vested and
    non-forfeitable Shares).
    





			
	 	(b)	
    To the extent that a Share is issued pursuant to
    the grant or exercise of a Full Value Award, it shall reduce the
    Share Authorization by 1.69 Shares; and, to the extent that a
    Share is issued pursuant to the grant or exercise of an Award
    other than a Full Value Award, it shall reduce the Share
    Authorization by one (1) Share.
    
	 
	 	(c)	
    Subject to adjustment as provided in
    Section 4.4, and subject to the limit set forth in
    Section 4.1(a) on the number of Shares that may be issued
    in the aggregate under the Plan, and in order to comply with the
    requirements of Section 422 of the Code and the regulations
    thereunder, the maximum number of Shares available for issuance
    pursuant to ISOs and NQSOs shall be:
    





			
	 	(i)	
    Eight million three hundred thousand (8,300,000)
    Shares that may be issued pursuant to Awards in the form of
    ISOs, plus a number of shares equal to the number of shares
    subject to outstanding awards under the Prior Plans as of the
    Effective Date that thereafter cease for any reason to be
    subject to such awards (other than by reason of exercise or
    settlement of the awards to the extent they are exercised for or
    settled in vested and non-forfeitable Shares) up to a maximum of
    eleven million three hundred sixty two thousand six hundred
    forty five (11,362,645); and
    
	 
	 	(ii)	
    Eight million three hundred thousand (8,300,000)
    Shares that may be issued pursuant to Awards in the form of
    NQSOs, plus a number of shares equal to the number of shares
    subject to outstanding awards under the Prior Plans as of the
    Effective Date that thereafter cease for any reason to be
    subject to such awards (other than by reason of exercise or
    settlement of the awards to the extent they are exercised for or
    settled in vested and non-forfeitable Shares) up to a maximum of
    eleven million three hundred sixty two thousand six hundred
    forty five (11,362,645).
    





			
	 	(d)	
    Subject to adjustment in Section 4.4 and
    subject to the limit set forth in Section 4.1(a) on the
    number of Shares that may be issued in the aggregate under the
    Plan, the maximum number of shares that may be issued to
    Non-Employee Directors shall be four hundred thousand (400,000)
    Shares, and no Non-Employee Director may be granted an award
    covering more than twenty thousand (20,000) Shares in any Plan
    Year, except that this annual limit on Non-Employee Director
    Awards shall be increased to forty thousand (40,000) Shares for
    any Non-Employee Director serving as Chairman of the Board;
    provided, however, that in the Plan Year in which an individual
    is first appointed or elected to the Board as a Non-Employee
    Director, such individual may be granted an Award covering no
    more than an additional forty thousand (40,000) Shares (a
    “New Non-Employee Director Award”).
    
	 
	 	(e)	
    Except with respect to a maximum of five percent
    (5%) of the Shares authorized in Section 4.1(a), any Full
    Value Awards, which vest on the basis of the Participant’s
    employment with or provision of service to the Company, shall
    not provide for vesting which is any more rapid than annual pro
    rata vesting over a three (3) year period, and any Full
    Value Awards which vest upon the attainment of performance
    goals, shall provide for a performance period of at least twelve
    (12) months.
    




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     4.2     Share
Usage.



			
	 	(a)	
    Shares covered by an Award shall only be counted
    as used to the extent they are actually issued and delivered to
    a Participant, or, if permitted by the Committee, a
    Participant’s designated transferee. Any Shares related to
    Awards which terminate by expiration, forfeiture, cancellation,
    or otherwise without the issuance of such Shares, are settled in
    cash in lieu of Shares, or are exchanged with the
    Committee’s permission, prior to the issuance of Shares,
    for Awards not involving Shares, shall be available again for
    grant under the Plan. Moreover, if the Option Price of any
    Option granted under the Plan or the tax withholding
    requirements with respect to any Award granted under the Plan
    are satisfied by tendering Shares to the Company (by either
    actual delivery or by attestation), or if a SAR is exercised,
    only the number of Shares issued, net of the Shares tendered, if
    any, will be deemed delivered for purposes of determining the
    maximum number of Shares available for delivery under the Plan.
    The maximum number of Shares available for issuance under the
    Plan shall not be reduced to reflect any dividends or dividend
    equivalents that are reinvested into additional Shares or
    credited as additional Restricted Stock, Restricted Stock Units,
    Performance Shares, or Stock-Based Awards. The Shares available
    for issuance under the Plan may be authorized and unissued
    Shares or treasury Shares.
    
	 
	 	(b)	
    The Committee shall have the authority to grant
    Awards as an alternative to or as the form of payment for grants
    or rights earned or due under other compensation plans or
    arrangements of the Company.
    




     
4.3     Annual Award
Limits. The following limits (each an
“Annual Award Limit” and, collectively, “Annual
Award Limits”) shall apply to grants of Awards under the
Plan:




			
	 	(a)	
    Options: The maximum
    aggregate number of Shares that may be granted in the form of
    Options, pursuant to all Awards of such type granted in any one
    Plan Year to any one Participant shall be five hundred thousand
    (500,000), plus the amount of the Participant’s unused
    applicable Annual Award Limit for Options as of the close of the
    previous Plan Year.
    
	 
	 	(b)	
    SARs: The maximum
    number of Shares that may be granted in the form of Stock
    Appreciation Rights, pursuant to all Awards of such type granted
    in any one Plan Year to any one Participant shall be five
    hundred thousand (500,000), plus the amount of the
    Participant’s unused applicable Annual Award Limit for SARs
    as of the close of the previous Plan Year.
    
	 
	 	(c)	
    Restricted Stock or Restricted Stock
    Units: The maximum aggregate grant
    with respect to Awards of Restricted Stock or Restricted Stock
    Units granted in any one Plan Year to any one Participant shall
    be five hundred thousand (500,000), plus the amount of the
    Participant’s unused applicable Annual Award Limit for
    Restricted Stock or Restricted Stock Units as of the close of
    the previous Plan Year.
    
	 
	 	(d)	
    Performance Units or Performance
    Shares: The maximum aggregate Award of
    Performance Units or Performance Shares that a Participant may
    receive in any one Plan Year shall be five hundred thousand
    (500,000) Shares, or equal to the value of five hundred thousand
    (500,000) Shares determined as of the date of vesting or payout,
    as
    




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    applicable, plus the amount of the
    Participant’s unused applicable Annual Award Limit for
    Performance Units or Performance Shares as of the close of the
    previous Plan Year.
    
	 
	 	(e)	
    Cash-Based Awards:
    The maximum aggregate amount awarded or credited with respect to
    Cash-Based Awards to any one Participant in any one Plan Year
    may not exceed the value of five million dollars ($5,000,000)
    determined as of the date of vesting or payout, as applicable,
    plus the amount of the Participant’s unused applicable
    Annual Award Limit for Cash-Based Awards as of the close of the
    previous Plan Year.
    
	 
	 	(f)	
    Covered Employee Annual Incentive
    Award. The maximum aggregate amount
    awarded or credited with respect to Covered Employee Annual
    Incentive Awards to any one Participant in any one Plan year may
    not exceed the value of five million dollars ($5,000,000)
    determined as of the date of vesting or payout, as applicable,
    plus the amount of the Participant’s unused applicable
    Annual Award Limit for Covered Employee Annual Incentive Awards
    as of the close of the previous Plan Year.
    
	 
	 	(g)	
    Other Stock-Based
    Awards. The maximum aggregate grant
    with respect to other Stock-Based Awards pursuant to
    Section 10.2 granted in any one Plan Year to any one
    Participant shall be five hundred thousand (500,000), plus the
    amount of the Participant’s unused applicable Annual Award
    Limit for Other Stock-Based Awards as of the close of the
    previous Plan Year.
    




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



     
The Committee, in its sole discretion, also may
make appropriate adjustments in the terms of any Awards under
the Plan to reflect or related to such changes or distributions
and to modify any other terms of outstanding Awards, including
modifications of performance goals and changes in the length of
Performance Periods. The determination of the Committee as to
the foregoing adjustments, if any, shall be conclusive and
binding on Participants under the Plan.



     
Subject to the provisions of Article 19,
without affecting the number of Shares reserved or available
hereunder or the number or types of options that may be granted
hereunder, the Committee may authorize the issuance or
assumption of awards under this Plan in connection with any
merger, consolidation, acquisition of property or stock or
reorganization upon such terms and conditions as it may deem
appropriate; provided, however, that, subject to adjustment as
provided above, the maximum amount of Shares with respect to
which ISOs, NQSOs and/or other Awards may be granted under this
paragraph is as set forth in section 4.1 (c) hereof.



A-9








 




Article 5.     Eligibility
and Participation


     
5.1     Eligibility.
Individuals eligible to participate in this Plan include all
Employees, Directors, and Third Party Service Providers.



     
5.2     Actual
Participation. Subject to the
provisions of the Plan, the Committee may, from time to time,
select from all eligible individuals, those to whom Awards shall
be granted and shall determine, in its sole discretion, the
nature of, any and all terms permissible by law, and the amount
of each Award, except that in the case of Non-Employee
Directors, such determinations shall be made by the Board
pursuant to Section 13.1.




Article 6.     Stock
Options


     
6.1     Grant of
Options. Subject to the terms and
provisions of the Plan, Options may be granted to Participants
in such number, and upon such terms, and at any time and from
time to time as shall be determined by the Committee, in its
sole discretion; provided that ISOs may be granted only to
eligible employees of the Company or of any parent or subsidiary
corporation (as permitted by Section 422 of the Code and
the regulations thereunder).



     
6.2     Award
Agreement. Each Option grant shall be
evidenced by an Award Agreement that shall specify the Option
Price, the maximum duration of the Option, the number of Shares
to which the Option pertains, the conditions upon which an
Option shall become vested and exercisable, and such other
provisions as the Committee shall determine which are not
inconsistent with the terms of the Plan. The Award Agreement
also shall specify whether the Option is intended to be an ISO
or a NQSO.



     
6.3     Option
Price. The Option Price for each grant
of an Option under this Plan shall be as determined by the
Committee and shall be specified in the Award Agreement;
provided, however, the Option Price shall not be less than one
hundred percent (100%) of the Fair Market Value of a Share on
the date the Option is granted.



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



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



     
6.6     Payment.
Options granted under this Article 6 shall be exercised by
the delivery of a notice of exercise to the Company or an agent
designated by the Company in a form specified or accepted by the
Committee, or by complying with any alternative procedures which
may be authorized by the Committee, setting forth the number of
Shares with respect to which the Option is to be exercised,
accompanied by full payment for the Shares.



     
A condition of the issuance of the Shares as to
which an Option shall be exercised shall be the payment of the
Option Price. The Option Price of any Option shall be payable to
the Company in full either: (a) in cash or its equivalent;
(b) by tendering (either by actual delivery or attestation)



A-10








 




previously acquired Shares having an aggregate
Fair Market Value at the time of exercise equal to the Option
Price (provided that the Shares that are tendered must have been
held by the Participant for at least six (6) months prior
to their tender to satisfy the Option Price or have been
purchased on the open market); (c) by a combination of (a)
and (b); or (d) any other method approved or accepted by
the Committee in its sole discretion.




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



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



     
6.7     Restrictions
on Share Transferability. The
Committee may impose such restrictions on any Shares acquired
pursuant to the exercise of an Option granted under this
Article 6 as it may deem advisable, including, without
limitation, minimum holding period requirements, restrictions
under applicable federal securities laws, under the requirements
of any stock exchange or market upon which such Shares are then
listed and/or traded, or under any blue sky or state securities
laws applicable to such Shares.



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



     
6.9     Transferability
of Options.




			
	 	(a)	
    Incentive Stock
    Options. No ISO granted under the Plan
    may be sold, transferred, pledged, assigned, or otherwise
    alienated or hypothecated, other than by will or by the laws of
    descent and distribution. Further, all ISOs granted to a
    Participant under this Article 6 shall be exercisable
    during his or her lifetime only by such Participant.
    
	 
	 	(b)	
    Non-Qualified Stock
    Options. Except as otherwise provided
    in a Participant’s Award Agreement or otherwise determined
    at any time by the Committee, no NQSO granted under this
    Article 6 may be sold, assigned, or otherwise
    alienated or hypothecated, other than by will or by the laws of
    descent and distribution; provided that the Board or Committee
    may permit further transferability, on a general or a specific
    basis, and may impose conditions and limitations on any
    permitted transferability. Further, except as otherwise provided
    in a Participant’s Award Agreement or otherwise determined
    at any time by the Committee, or unless the Board or Committee
    decides to permit further transferability, all NQSOs granted to
    a Participant under this Article 6 shall be exercisable
    during his or her lifetime only by such Participant. With
    respect to those NQSOs, if any, that are permitted to be
    transferred to another person, references in the Plan to
    exercise or payment of the Option Price
    




A-11








 


			
	 		
    by the Participant shall be deemed to include, as
    determined by the Committee, the Participant’s permitted
    transferee.
    




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



     
6.11     Substituting
SARs. In the event the Company no
longer uses APB Opinion 25 to account for equity compensation
and is required to or elects to expense the cost of Options
pursuant to FAS 123 (or a successor standard), the Committee
shall have the ability to substitute, without receiving
Participant permission, SARs paid only in Stock (or SARs paid in
Stock or cash at the Committee’s discretion) for
outstanding Options; provided, the terms of the substituted
Stock SARs are substantially equivalent to the terms for the
Options and the excess of the Fair Market Value of the
underlying Shares over the aggregate Grant Price of the SARs is
equivalent to the excess of the Fair Market Value of the
underlying Shares over the aggregate Option Price of the
Options. If this provision creates adverse accounting
consequences for the Company, it shall be considered void by the
Committee.




Article 7.     Stock
Appreciation Rights


     
7.1     Grant of
SARs. Subject to the terms and
conditions of the Plan, SARs may be granted to Participants at
any time and from time to time as shall be determined by the
Committee. The Committee may grant Freestanding SARs, Tandem
SARs, or any combination of these forms of SARs.



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



     
The Grant Price for each grant of a Freestanding
SAR shall be determined by the Committee and shall be specified
in the Award Agreement. The Grant Price may be based on one
hundred percent (100%) of the FMV of the Shares on the date of
grant, set at a premium to the FMV of the Shares on the date of
grant, or indexed to the FMV of the Shares on the date of grant,
with the index determined by the Committee, in its discretion.
The Grant Price of Tandem SARs shall be equal to the Option
Price of the related Option.



     
7.2     SAR
Agreement. Each SAR Award shall be
evidenced by an Award Agreement that shall specify the Grant
Price, the term of the SAR, and such other provisions as the
Committee shall determine.



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



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



A-12








 



     
7.5.     Exercise of
Tandem SARs. Tandem SARs may be
exercised for all or part of the Shares subject to the related
Option upon the surrender of the right to exercise the
equivalent portion of the related Option. A Tandem SAR may be
exercised only with respect to the Shares for which its related
Option is then exercisable.



     
Notwithstanding any other provision of this Plan
to the contrary, with respect to a Tandem SAR granted in
connection with an ISO: (a) the Tandem SAR will expire no
later than the expiration of the underlying ISO; (b) the
value of the payout with respect to the Tandem SAR may be for no
more than one hundred percent (100%) of the excess of the Fair
Market Value of the Shares subject to the underlying ISO over
the aggregate Option Price of the Shares subject to the
underlying ISO at the time the Tandem SAR is exercised; and
(c) the Tandem SAR may be exercised only when the Fair
Market Value of the Shares subject to the ISO exceeds the
aggregate Option Price of the ISO.



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




			
	 	(a)	
    The excess of the Fair Market Value of a Share on
    the date of exercise over the Grant Price; by
    
	 
	 	(b)	
    The number of Shares with respect to which the
    SAR is exercised.
    





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



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



     
7.8     Non-Transferability
of SARs. Except as otherwise provided
in a Participant’s Award Agreement or otherwise at any time
by the Committee, no SAR granted under the Plan may be sold,
transferred, pledged, assigned, or otherwise alienated or
hypothecated, other than by will or by the laws of descent and
distribution. Further, except as otherwise provided in a
Participant’s Award Agreement or otherwise at any time by
the Committee, all SARs granted to a Participant under the Plan
shall be exercisable during his or her lifetime only by such
Participant. With respect to those SARs, if any, that are
permitted to be transferred to another person, references in the
Plan to exercise of the SAR by the Participant or payment of any
amount to the Participant shall be deemed to include, as
determined by the Committee, the Participant’s permitted
transferee.



     
7.9     Other
Restrictions. The Committee shall
impose such other conditions and/or restrictions on any Shares
received upon exercise of a SAR granted pursuant to the Plan as
it may deem advisable or desirable. These restrictions may
include, but shall not be limited to, a requirement that the
Participant hold the Shares received upon exercise of a SAR for
a specified period of time.



A-13








 




Article 8.     Restricted
Stock and Restricted Stock Units


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



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



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



     
8.4     Other
Restrictions. The Committee shall
impose such other conditions and/or restrictions on any Shares
of Restricted Stock or Restricted Stock Units granted pursuant
to the Plan as it may deem advisable including, without
limitation, a requirement that Participants pay a stipulated
purchase price for each Share of Restricted Stock or each
Restricted Stock Unit, restrictions based upon the achievement
of specific performance goals, time-based restrictions on
vesting following the attainment of the performance goals,
time-based restrictions, and/or restrictions under applicable
laws or under the requirements of any stock exchange or market
upon which such Shares are listed or traded, or holding
requirements or sale restrictions placed on the Shares by the
Company upon vesting of such Restricted Stock or Restricted
Stock Units. In the case of Restricted Stock and/or Restricted
Stock Units granted to Covered Employees which awards are
intended to constitute Performance Based Compensation the
applicable performance goal(s) for such Awards shall be selected
from those listed in Article 11.



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



     
Except as otherwise provided in this
Article 8 or under applicable law, Shares of Restricted
Stock covered by each Restricted Stock Award shall become freely
transferable by the Participant after all conditions and
restrictions applicable to such Shares have been satisfied or
lapse (including satisfaction of any applicable tax withholding
obligations), and Restricted Stock Units shall be paid in cash,
Shares, or a combination of cash and Shares as the Committee, in
its sole discretion shall determine.



A-14








 



     
8.5     Certificate
Legend. In addition to any legends
placed on certificates pursuant to Section 8.4, each
certificate representing Shares of Restricted Stock granted
pursuant to the Plan may bear a legend such as the following or
as otherwise determined by the Committee in its sole discretion:



     
The sale or transfer of Shares of stock
represented by this certificate, whether voluntary, involuntary,
or by operation of law, is subject to certain restrictions on
transfer as set forth in the Arrow Electronics, Inc. 2004
Omnibus Incentive Plan, and in the associated Award Agreement. A
copy of the Plan and such Award Agreement may be obtained from
Arrow Electronics, Inc.



     
8.6     Voting
Rights. Unless otherwise determined by
the Committee and set forth in a Participant’s Award
Agreement, to the extent permitted or required by law, as
determined by the Committee, Participants holding Shares of
Restricted Stock granted hereunder may be granted the right to
exercise full voting rights with respect to those Shares during
the Period of Restriction. There shall be no voting rights with
respect to any Restricted Stock Units granted hereunder.



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



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




Article 9.     Performance
Units/ Performance Shares


     
9.1     Grant of
Performance Units/ Performance Shares.
Subject to the terms and provisions of the Plan, the Committee,
at any time and from time to time, may grant Performance Units
and/or Performance Shares to Participants in such amounts and
upon such terms as the Committee shall determine.



     
9.2     Value of
Performance Units/ Performance Shares.
Each Performance Unit shall have an initial value that is
established by the Committee at the time of grant. Each
Performance Share shall have an initial value equal to the Fair
Market Value of a Share on the date of grant. The Committee
shall set performance goals in its discretion which, depending
on the extent to which they are met, will determine the value
and/or number of Performance Units/ Performance Shares that will
be paid out to the Participant. In the case of Performance Units
and or Performance Shares granted to Covered Employees which
awards are intended to constitute Performance Based Compensation
the applicable performance goal(s) for such Awards shall be
selected from those listed in Article 11.



     
9.3     Earning of
Performance Units/ Performance Shares.
Subject to the terms of this Plan, after the applicable
Performance Period has ended, the holder of Performance Units/
Performance Shares shall be entitled to receive payout on the
value and number of Performance Units/



A-15








 




Performance Shares earned by the Participant over
the Performance Period, to be determined as a function of the
extent to which the corresponding performance goals have been
achieved.




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



     
9.5     Dividends and
Other Distributions. At the discretion
of the Committee, Participants holding Performance Shares may be
entitled to receive dividend equivalents with respect to
dividends declared with respect to the Shares. Such dividend
equivalents may be in the form of cash, Shares, Restricted
Stock, or Restricted Stock Units and may be subject to such
accrual, forfeiture, or payout restrictions as determined by the
Committee in its sole discretion and as evidenced in the Award
Agreement.



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



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




Article 10.     Cash-Based
Awards and Other Stock-Based Awards


     
10.1     Grant of
Cash-Based Awards. Subject to the
terms and provisions of the Plan, the Committee, at any time and
from time to time, may grant Cash-Based Awards to Participants
in such amounts and upon such terms as the Committee may
determine.



     
10.2     Other
Stock-Based Awards. The Committee may
grant other types of equity-based or equity-related Awards not
otherwise described by the terms of this Plan (including the
grant or offer for sale of unrestricted Shares) in such amounts
and subject to such terms and conditions, as the Committee shall
determine. Such Awards may involve the transfer of actual Shares
to Participants, or payment in cash or otherwise of amounts
based on the value of Shares and may include, without
limitation, Awards designed to comply with or take advantage of
the applicable local laws of jurisdictions other than the United
States.



A-16








 



     
10.3     Value of
Cash-Based and Other Stock-Based
Awards. Each Cash-Based Award shall
specify a payment amount or payment range as determined by the
Committee. Each Other Stock-Based Award shall be expressed in
terms of Shares or units based on Shares, as determined by the
Committee. The Committee may establish performance goals in its
discretion. If the Committee exercises its discretion to
establish performance goals, the number and/or value of
Cash-Based Awards or Other Stock-Based Awards that will be paid
out to the Participant will depend on the extent to which the
performance goals are met. In the case of Cash-Based Awards
and/or Other Stock-Based Awards granted to Covered Employees
which Awards are intended to constitute Performance Based
Compensation the applicable performance goals for such Awards
shall be selected from those listed in Article 11.



     
10.4     Payment of
Cash-Based Awards and Other Stock-Based
Awards. Payment, if any, with respect
to a Cash-Based Award or an Other Stock-Based Award shall be
made in accordance with the terms of the Award, in cash or
Shares as the Committee determines.



     
10.5     Termination
of Employment. The Committee shall
determine the extent to which the Participant shall have the
right to receive Cash-Based Awards and Other Stock-Based Awards
following termination of the Participant’s employment with
or provision of services to the Company, its Affiliates, and/or
its Subsidiaries, as the case may be. Such provisions shall be
determined in the sole discretion of the Committee, such
provisions may be included in an agreement entered into with
each Participant, but need not be uniform among all Awards of
Cash-Based Awards and Other Stock-Based Awards issued pursuant
to the Plan, and may reflect distinctions based on the reasons
for termination.



     
10.7     Non-Transferability.
Except as otherwise determined by the Committee, neither
Cash-Based Awards nor Other Stock-Based Awards may be sold,
transferred, pledged, assigned, or otherwise alienated or
hypothecated, other than by will or by the laws of descent and
distribution. Further, except as otherwise provided by the
Committee, a Participant’s rights under the Plan, if
exercisable, shall be exercisable during his or her lifetime
only by such Participant. With respect to those Cash-Based
Awards or Other Stock-Based Awards, if any, that are permitted
to be transferred to another person, references in the Plan to
exercise or payment of such Awards by or to the Participant
shall be deemed to include, as determined by the Committee, the
Participant’s permitted transferee.




Article 11.     Performance
Measures


     
11.1     Performance
Measures. Unless and until the
Committee proposes for shareholder vote and the shareholders
approve a change in the general Performance Measures set forth
in this Article 11, the performance goals upon which the
payment or vesting of an Award to a Covered Employee that is
intended to qualify as Performance-Based Compensation shall be
limited to the following Performance Measures:




			
	 	(a)	
    net income;
    
	 
	 	(b)	
    earnings per share;
    
	 
	 	(c)	
    sales growth;
    
	 
	 	(d)	
    income before taxes;
    




A-17








 




			
	 	(e)	
    net operating profit;
    
	 
	 	(f)	
    return measures (including, but not limited to,
    return on assets, capital, equity, or sales);
    
	 
	 	(g)	
    cash flow (including, but not limited to,
    operating cash flow and free cash flow);
    
	 
	 	(h)	
    earnings before, interest, taxes, depreciation,
    and/or amortization;
    
	 
	 	(i)	
    operating margins including gross profit,
    operating expenses and operating income as a percentage of sales;
    
	 
	 	(j)	
    productivity ratios;
    
	 
	 	(k)	
    share price (including, but not limited to,
    growth measures and total shareholder return);
    
	 
	 	(l)	
    expense targets;
    
	 
	 	(m)	
    operating efficiency;
    
	 
	 	(n)	
    customer satisfaction;
    
	 
	 	(o)	
    working capital targets; and
    
	 
	 	(p)	
    economic value-added.
    




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



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



     
11.3     Adjustment
of Performance-Based Compensation.
Awards that are designed to qualify as Performance-Based
Compensation, and that are held by Covered Employees, may not be
adjusted upward. The Committee shall retain the discretion to
adjust such Awards downward, either on a formula or
discretionary basis or any combination, as the Committee
determines.



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11.4     Committee
Discretion. In the event that
applicable tax and/or securities laws change to permit Committee
discretion to alter the governing Performance Measures without
obtaining shareholder approval of such changes, the Committee
shall have sole discretion to make such changes without
obtaining shareholder approval. In addition, in the event that
the Committee determines that it is advisable to grant Awards
that shall not qualify as Performance-Based Compensation, the
Committee may make such grants without satisfying the
requirements of Code Section 162(m) and may base vesting on
Performance Measures in addition to or other than those set
forth in Section 11.1.




Article 12.     Covered
Employee Annual Incentive Award


     
Notwithstanding any other provision of this Plan
to the contrary, for each Plan Year a Covered Employee Annual
Incentive Award shall be paid to any Participant who is an
executive officer of the Company and, in the Committee’s
determination, is likely to be a “covered employee”
within the meaning of Section 162(m) of the Code only in
accordance with the provisions of this Article. Within the first
ninety (90) days of each Plan Year, the Committee shall
establish (i) the performance goals, selected from the list
of Performance Measures in Section 11.1, that must be
achieved in order for a Covered Employee Annual Incentive Award
to be paid to any Covered Employee for the Plan Year, and
(ii) the amount of each Covered Employee’s Covered
Employee Annual Incentive Award that could be paid based on
attainment of such performance goals for the Plan Year. As soon
as practicable following the end of each Plan Year, the
Committee shall certify whether each Covered Employee otherwise
satisfied the requirements of this Plan to receive a Covered
Employee Annual Incentive Award. Upon the Committee’s
certification thereof, the Covered Employee Annual Incentive
Awards shall be paid to the Covered Employees or such lesser
amounts as the Committee in its discretion shall prescribe
taking into account the otherwise applicable provisions of this
Plan and the performance of the Company and the Covered
Employees during the Plan Year, provided that such action does
not preclude the Covered Employee Annual Incentive Award to any
Covered Employee from qualifying as performance based
compensation under Section 162(m) of the Code. The
Committee shall not exercise any discretion in its
administration of the Plan that would be inconsistent with the
purposes of Section 162(m) of the Code.




Article 13.     Non-Employee
Director Awards


     
13.1     Non-Employee
Director Awards. Non-Employee
Directors may only be granted Awards under the Plan in
accordance with this Article 13 and which shall not be
subject to management’s discretion. From time to time, the
Board shall set the amount(s) and type(s) of equity awards that
shall be granted to all Non-employee Directors on a periodic,
nondiscriminatory basis pursuant to the Plan, as well as any
additional amount(s), if any, to be awarded, also on a periodic,
nondiscriminatory basis, based on each of the following: the
number of committees of the Board on which a Non-Employee
Director serves, service of a Non-Employee Director as the chair
of a Committee of the Board, service of a Non-Employee Director
as Chairman of the Board, or the first selection or appointment
of an individual to the Board as a Non-Employee Director.
Subject to the limits set forth in Section 4.1(d) and the
foregoing, the Board shall grant such Awards to Non-



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Employee Directors and the Non-Employee Chairman
of the Board, and grant New Non-Employee Director Awards, as it
shall from time to time determine.




     
13.2     Non-Employee
Director Deferrals.



			
	 	(a)	
    Mandatory Deferral:
    Fifty percent (50%) of each payment comprising any annual
    retainer fees payable by the Company to each Non-Employee
    Director shall automatically be withheld by the Company and
    deferred hereunder, except to the extent that the Non-Employee
    Director has made an Optional Deferral Election in accordance
    with Section 13.2(b).
    
	 
	 	(b)	
    Optional Deferral
    Elections: A Non-Employee Director may
    submit a written election to the Secretary of the Company not to
    have the deferral provisions of Section 13.2(a) apply to
    the Non- Employee Director’s retainer fees or to have a
    deferral of a percentage other than fifty percent (50%) apply
    (an “Optional Deferral Election”) as follows:
    





			
	 	(i)	
    Prior to the Effective Date of the Plan, each
    Non-Employee Director may submit an Optional Deferral Election,
    which may specify that no portion of the Non-Employee
    Director’s retainer fees will be deferred under
    Section 13.2 or that a selected percentage other than fifty
    percent (50%) of the Non-Employee Director’s retainer fees
    will be deferred under Section 13.2. Such Optional Deferral
    Election will be effective unless and until it is revoked in
    writing.
    
	 
	 	(ii)	
    Each Non-Employee Director initially elected
    after the Effective Date of the Plan may submit an Optional
    Deferral Election prior to the Non-Employee Director’s
    receipt of any portion of any retainer fee which may specify
    that no portion of the Non-Employee Director’s retainer
    fees will be deferred under Section 13.2 or that a selected
    percentage other than fifty percent (50%) of the Non-Employee
    Director’s retainer fees will be deferred under
    Section 13.2, such Optional Deferral Election will be
    effective unless and until it is revoked in writing.
    
	 
	 	(iii)	
    On an ongoing basis, each Non-Employee Director
    who has not made a standing Optional Deferral Election may make
    an Optional Deferral Election requesting the cessation of
    deferrals from his or her future payments of annual retainer
    fees or specifying that a selected percentage other than fifty
    percent (50%) of the Non-Employee Director’s retainer fees
    will be deferred under Section 13.2. In addition, any
    Non-Employee Director who has previously made a standing
    Optional Deferral Election may submit a new Optional Deferral
    Election, which will supersede the prior Optional Deferral
    Election. Any such election will take effect as of the
    commencement of the calendar year following the year in which
    the election is made and will be honored unless and until it is
    revoked in writing prior to the commencement of the calendar
    year in which such revocation is to become effective. However,
    any amounts deferred prior to the effective date of the new
    Optional Deferral Election will continue to be deferred under
    Section 13.2.
    





			
	 	(c)	
    Maintenance of Deferred
    Accounts: A recordkeeping account
    shall be established and maintained in the name of each
    Non-Employee Director. Amounts which are deferred hereunder
    shall be converted into units (“Units”) based on the
    Fair Market Value of the Company’s common stock, and such
    Units (including any fractional Units) shall be
    




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    credited to the Non-Employee Director’s
    account. The conversion and crediting of deferrals shall occur
    as of the date that such deferred amounts would otherwise have
    been payable to the Non- Employee Director. Dividend equivalents
    earned on the basis of whole Units previously credited to a
    Non-Employee Director’s account shall be credited to the
    Non-Employee Director’s account as Units, including
    fractional Units, on the date any such dividend has been
    declared to be payable on Shares. Units, excluding fractional
    Units, shall earn dividend equivalents from the date such Units
    are credited to a Non-Employee Director’s account until the
    date such Units are converted into Shares and distributed.
    Dividend equivalents shall be computed by multiplying the
    dividend paid per Share during the period Units are credited to
    a Non-Employee Director’s account times the number of whole
    Units so credited, but Units shall earn such dividend
    equivalents only as, if, and when dividends are declared and
    paid on Shares.
    
	 
	 	(d)	
    Method of Distribution of
    Deferrals: No distribution of
    deferrals may be made except as provided in this
    Section 13.2(d) or in a deferral agreement between the
    Company and a Non-employee Director. As of the last business day
    of the calendar month in which a Non-Employee Director’s
    service as a director of the Company ceases, each whole Unit
    then credited to the Non-Employee Director’s deferral
    account shall be converted into one Share and any fractional
    Unit shall be converted into cash by multiplying such fraction
    by the Fair Market Value of a Share as of such date. Such Shares
    and cash shall be distributed to the Non-Employee Director in a
    single lump sum, as soon as practicable following such date. At
    the written request of a Non-Employee Director, the Board of
    Directors, in its sole discretion, may accelerate payment of
    amounts deferred hereunder, upon a showing of unforeseeable
    emergency by such Non-Employee Director. For purposes of this
    paragraph, “unforeseeable emergency” is defined as
    severe financial hardship resulting from extraordinary and
    unanticipated circumstances arising as a result of one or more
    recent events beyond the control of the Non-Employee Director.
    In any event, payment may not be made to the extent such
    emergency is or may be relieved: (1) through reimbursement
    or compensation by insurance or otherwise; (2) by
    liquidation of the Non-Employee Director’s assets, to the
    extent the liquidation of such assets would not, itself, cause
    severe financial hardship; and (3) by cessation of
    deferrals under the Plan. Examples of events that are not
    considered to be unforeseeable emergencies include the need to
    send a Non-Employee Director’s child to college or the
    desire to purchase a home.
    





Article 14.     Dividend
Equivalents


     
Any Participant selected by the Committee may be
granted dividend equivalents based on the dividends declared on
Shares that are subject to any Award, to be credited as of
dividend payment dates, during the period between the date the
Award is granted and the date the Award is exercised, vests or
expires, as determined by the Committee. Such dividend
equivalents shall be converted to cash or additional Shares by
such formula and at such time and subject to such limitations as
may be determined by the Committee.



     
Dividend equivalents granted with respect to
Options or SARs that are intended to be Performance-Based
Compensation shall be payable, with respect to pre-exercise
periods, regardless of whether such Option or SAR is
subsequently exercised.



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Article 15.     Beneficiary
Designation


     
Each Participant under the Plan may, from time to
time, name any beneficiary or beneficiaries (who may be named
contingently or successively) to whom any benefit under the Plan
is to be paid in case of his or her death before he or she
receives any or all of such benefit. Each such designation shall
revoke all prior designations by the same Participant, shall be
in a form prescribed by the Committee, and will be effective
only when filed by the Participant in writing with the Company
during the Participant’s lifetime. In the absence of any
such designation, benefits remaining unpaid at the
Participant’s death shall be paid to the Participant’s
estate.




Article 16.     Deferrals


     
The Committee may permit or, in an Award
Agreement, require officers or Non-Employee Directors to defer
receipt of the payment of cash or the delivery of Shares that
would otherwise be due to such officers or Non-Employee
Directors by virtue of the exercise of an Option or SAR, the
lapse or waiver of restrictions with respect to Restricted Stock
or Restricted Stock Units, or the satisfaction of any
requirements or performance goals with respect to Performance
Shares, Performance Units, Cash-Based Awards, Covered Employee
Annual Incentive Awards, Other Stock-Based Awards, or Cash-Based
Awards. If any such deferral election is required or permitted,
the Committee shall, in its sole discretion, establish rules and
procedures for such payment deferrals.




Article 17.     Rights
of Participants


     
17.1     Employment.
Nothing in the Plan or an Award Agreement shall interfere with
or limit in any way the right of the Company, its Affiliates,
and/or its Subsidiaries, to terminate any Participant’s
employment or service on the Board or to the Company at any time
or for any reason not prohibited by law, nor confer upon any
Participant any right to continue his or her employment or
service as a Director or Third Party Service Provider for any
specified period of time.



     
Neither an Award nor any benefits arising under
this Plan shall constitute an employment contract with the
Company, its Affiliates, and/or its Subsidiaries and,
accordingly, subject to Articles 3 and 19, this Plan
and the benefits hereunder may be terminated at any time in the
sole and exclusive discretion of the Committee without giving
rise to any liability on the part of the Company, its
Affiliates, and/or its Subsidiaries.



     
17.2     Participation.
No individual shall have the right to be selected to receive an
Award under this Plan, or, having been so selected, to be
selected to receive a future Award.



     
17.3     Rights as a
Shareholder. Except as otherwise
provided herein, a Participant shall have none of the rights of
a shareholder with respect to Shares covered by any Award until
the Participant becomes the record holder of such Shares.



     
17.4     No Third
Party Beneficiaries. This Plan does
not confer any right or remedy other than to Participants, the
Company, and their respective permitted successors and assigns,
and no action may be brought against the Company, the Board, the
Committee, or any of the Committee’s delegates by any third
party claiming as a third party beneficiary to the Plan or any
Award Agreement.



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Article 18.     Corporate
Events


     
Unless otherwise set forth in the Award
Agreement, upon a dissolution or liquidation of the Company, or
a sale of substantially all of the assets of the Company, its
Subsidiaries, and its Affiliates and the acquiring entity does
not substitute new and equivalent Awards for the outstanding
Awards hereunder, or a merger or consolidation in which the
surviving corporation does not substitute new and equivalent
Awards for the outstanding Awards hereunder, (each a
“Corporate Event”) each Participant shall be given at
least ten days prior written notice of the occurrence of such
Corporate Event, every Award outstanding hereunder shall become
fully vested and exercisable, all restrictions on such Awards
shall lapse and each Participant may exercise any Award that is
in the form of an Option or SAR, in whole or in part, prior to
or simultaneously with such Corporate Event. Unless otherwise
set froth in the Award Agreement, upon the occurrence of any
such Corporate Event, any Option or SAR not exercised pursuant
hereto shall terminate. Unless otherwise set forth in the Award
Agreement, furthermore, upon the occurrence of a Corporate
Event, the Company shall have the option to cancel every
outstanding Award hereunder (other than Options and SARs
outstanding the cancellation which would be handled by the
preceding sentence) and to pay the holder of such Awards the
value of those Awards as determined by the Board or Committee in
their sole discretion.




Article 19.     Amendment,
Modification, Suspension, and Termination


     
19.1     Amendment,
Modification, Suspension, and
Termination. Subject to
Section 19.3, the Committee may, at any time and from time
to time, alter, amend, modify, suspend, or terminate the Plan
and any Award Agreement in whole or in part; provided, however,
that, without the prior approval of the Company’s
shareholders and except as provided in Sections 4.4 and
6.11 hereof, Options issued under the Plan will not be repriced,
replaced, or regranted through cancellation, or by lowering the
Option Price of a previously granted Option, and no amendment of
the Plan shall be made without shareholder approval if
shareholder approval is required by law, regulation, or stock
exchange rule, including, but not limited to, the Securities
Exchange Act of 1934, as amended, the Internal Revenue Code of
1986, as amended, and, if applicable, the New York Stock
Exchange Listed Company Manual.



     
19.2     Adjustment
of Awards Upon the Occurrence of Certain Unusual or
Non-recurring Events. The Committee
may make adjustments in the terms and conditions of, and the
criteria included in, Awards in recognition of unusual or
nonrecurring events (including, without limitation, the events
described in Section 4.4 hereof) affecting the Company or
the financial statements of the Company or of changes in
applicable laws, regulations, or accounting principles, whenever
the Committee determines that such adjustments are appropriate
in order to prevent unintended dilution or enlargement of the
benefits or potential benefits intended to be made available
under the Plan. The determination of the Committee as to the
foregoing adjustments, if any, shall be conclusive and binding
on Participants under the Plan.



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



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Article 20.     Withholding


     
20.1     Tax
Withholding. The Company shall have
the power and the right to deduct or withhold, or require a
Participant to remit to the Company, the minimum statutory
amount to satisfy federal, state, and local taxes, domestic or
foreign, required by law or regulation to be withheld with
respect to any taxable event arising as a result of this Plan.



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




Article 21.     Successors


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




Article 22.     General
Provisions


     
22.1     Forfeiture
Events.




			
	 	(a)	
    The Committee may specify in an Award Agreement
    that the Participant’s rights, payments, and benefits with
    respect to an Award shall be subject to reduction, cancellation,
    forfeiture, or recoupment upon the occurrence of certain
    specified events, in addition to any otherwise applicable
    vesting or performance conditions of an Award. Such events may
    include, but shall not be limited to, termination of employment
    for cause, termination of the Participant’s provision of
    services to the Company, Affiliate, and/or Subsidiary, violation
    of material Company, Affiliate, and/or Subsidiary policies,
    breach of noncompetition, confidentiality, or other restrictive
    covenants that may apply to the Participant, or other conduct by
    the Participant that is detrimental to the business or
    reputation of the Company, its Affiliates, and/or its
    Subsidiaries.
    
	 
	 	(b)	
    If Section 304 of the Sarbanes-Oxley Act of
    2002 applies to any Award or payment in settlement of any Award,
    the Participant shall and hereby agrees to reimburse the Company
    for any such amounts or Awards as provided by Section 304
    of the Sarbanes-Oxley Act of 2002.
    




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



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



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



     
22.5     Requirements
of Law. The granting of Awards and the
issuance of Shares under the Plan shall be subject to all
applicable laws, rules, and regulations, and to such approvals
by any governmental agencies or national securities exchanges as
may be required.



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




			
	 	(a)	
    Obtaining any approvals from governmental
    agencies that the Company determines are necessary or advisable;
    and
    
	 
	 	(b)	
    Completion of any registration or other
    qualification of the Shares under any applicable national or
    foreign law or ruling of any governmental body that the Company
    determines to be necessary or advisable.
    




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



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



     
22.9     Employees,
Directors, Third Party Service Providers, and Participants Based
Outside of the United States.
Notwithstanding any provision of the Plan to the contrary, in
order to comply with the laws in other countries in which the
Company, its Affiliates, and/or its Subsidiaries operate or have
Employees, Directors, Third Party Service Providers, or
Participants, the Committee, in its sole discretion, shall have
the power and authority to:




			
	 	(a)	
    Determine which Affiliates and Subsidiaries shall
    be covered by the Plan;
    
	 
	 	(b)	
    Determine which Employees, Directors, Third Party
    Service Providers, or Participants outside the United States are
    eligible to participate in the Plan;
    
	 
	 	(c)	
    Modify the terms and conditions of any Award
    granted to Employees, Directors, Third Party Service Providers,
    or Participants outside the United States to comply with
    applicable foreign laws;
    
	 
	 	(d)	
    Establish subplans and modify exercise procedures
    and other terms and procedures, to the extent such actions may
    be necessary or advisable. Any subplans and modifications to
    Plan terms and procedures established under this
    Section 22.9 by the Committee shall be attached to this
    Plan document as appendices; and
    




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




     
Notwithstanding the above, the Committee may not
take any actions hereunder, and no Awards shall be granted, that
would violate applicable law.



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



     
22.11     Unfunded
Plan. Participants shall have no
right, title, or interest whatsoever in or to any investments
that the Company, and/or its Subsidiaries, and/or Affiliates may
make to aid it in meeting its obligations under the Plan.
Nothing contained in the Plan, and no action taken pursuant to
its provisions, shall create or be construed to create a trust
of any kind, or a fiduciary relationship between the Company and
any Participant, beneficiary, legal representative, or any other
person. To the extent that any person acquires a right to
receive payments from the Company, and/or its Subsidiaries,
and/or Affiliates under the Plan, such right shall be no greater
than the right of an unsecured general creditor of the Company,
a Subsidiary, or an Affiliate, as the case may be. All payments
to be made hereunder shall be paid from the general funds of the
Company, a Subsidiary, or an Affiliate, as the case may be and
no special or separate fund shall be established and no
segregation of assets shall be made to assure payment of such
amounts except as expressly set forth in the Plan. The Plan is
not subject to ERISA.



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



     
22.13     Retirement
and Welfare Plans. Neither Awards made
under the Plan nor Shares or cash paid pursuant to such Awards,
except pursuant to Covered Employee Annual Incentive Awards,
will be included as “compensation” for purposes of
computing the benefits payable to any Participant under the
Company’s or any Subsidiary’s or Affiliate’s
retirement plans (both qualified and non-qualified) or welfare
benefit plans unless such other plan expressly provides that
such compensation shall be taken into account in computing a
participant’s benefit.



     
22.14     Nonexclusivity
of the Plan. The adoption of this Plan
shall not be construed as creating any limitations on the power
of the Board or Committee to adopt such other compensation
arrangements as it may deem desirable for any Participant.



     
22.15     No
Constraint on Corporate Action.
Nothing in this Plan shall be construed to: (i) limit,
impair, or otherwise affect the Company’s or a
Subsidiary’s or an Affiliate’s right or power to make
adjustments, reclassifications, reorganizations, or changes of
its capital or business structure, or to merge or consolidate,
or dissolve, liquidate, sell, or transfer all or any part of its
business or assets; or, (ii) limit the right or power of
the Company or a Subsidiary or an Affiliate to take any action
which such entity deems to be necessary or appropriate.



     
22.16     Right of
First Refusal. Unless otherwise set
forth in the Award Agreement, shares acquired under the Plan by
a Participant may not be sold or otherwise disposed of in any
way (including a transfer or gift or by reason of the death of
the Participant) until the Participant (or his



A-26








 




legal representative, legatee or distributee of
his or her estate) first offers to sell the Shares to the
Company as herein provided. The price per Share at which the
Shares shall be offered to the Company shall be the closing
price per Share reported on the Consolidated Tape (as such price
is reported in the Wall Street Journal or if such
publication is unavailable then Reuters) on the date the
Participant’s offer is received by the Secretary of the
Company. If the Company fails to accept the offer to purchase
such Shares within seven days after such date, the Shares shall
thereafter be free of all restrictions under the Plan.




     
22.17     Ratification
of Actions. By accepting any Award or
other benefit under the Plan, each Participant and each person
claiming under or through each Participant shall be conclusively
deemed to have indicated his or her acceptance and ratification
of, and consent to, any action taken under the Plan by the
Company, the Board or the Committee.



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



     
22.19     Jury
Waiver. Every Participant, every
person claiming under or through a Participant, and the Company
hereby waives to the fullest extent permitted by applicable law
any right to a trial by jury with respect to any litigation
directly or indirectly arising out of, under, or in connection
with the Plan or any Award Agreement issued pursuant to the Plan.



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