exv10w11



 





Exhibit 10.11




FELCOR LODGING TRUST INCORPORATED




NON-QUALIFIED DEFERRED COMPENSATION PLAN




(as amended and restated effective January 1, 2005)




 









 





	 	 	 	 	 	 	 
	Table
of Contents

	 	Page	 
	 
	SECTION ONE

	 	DEFINITIONS
	 	 	1	 
	SECTION TWO

	 	ADMINISTRATION
	 	 	9	 
	SECTION THREE

	 	PARTICIPANTS
	 	 	11	 
	SECTION FOUR

	 	CONTRIBUTIONS AND ELECTIONS
	 	 	11	 
	SECTION FIVE

	 	ACCOUNTS AND INVESTMENT DIRECTIONS
	 	 	12	 
	SECTION SIX

	 	VESTING
	 	 	13	 
	SECTION SEVEN

	 	PAYMENT
	 	 	14	 
	SECTION EIGHT

	 	SOURCE OF PAYMENT
	 	 	15	 
	SECTION NINE

	 	PROVISIONS RELATING TO DEFERRED SHARES

CREDITED TO THE DEFERRED SHARE ACCOUNT
	 	 	15	 
	SECTION TEN

	 	HARDSHIP WITHDRAWALS
	 	 	16	 
	SECTION ELEVEN

	 	DESIGNATION OF BENEFICIARIES
	 	 	16	 
	SECTION TWELVE

	 	AMENDMENT OR TERMINATION
	 	 	17	 
	SECTION THIRTEEN

	 	GENERAL PROVISIONS
	 	 	18	 







i









 








FELCOR LODGING TRUST INCORPORATED




NON-QUALIFIED DEFERRED COMPENSATION PLAN



This Plan, initially adopted effective December 30, 1998, sets forth the terms of the FelCor
Lodging Trust Incorporated Non-Qualified Deferred Compensation Plan, an unfunded, non-qualified,
deferred compensation plan, designed primarily to provide additional benefits to a select group of
management personnel and Directors in order to retain and motivate such individuals whose efforts
are critical to the success of the Company. The Plan has been amended and restated as of January
1, 2005 to preserve the grandfathered status of the Plan under Section 409A of the Code and to
reflect the partial termination of the Plan on each of November 15, 2006 and March 3, 2007.



Because the Plan is unfunded and is maintained by the Company primarily for the purpose of
providing deferred compensation for a select group of management or highly compensated employees,
the Plan is exempt from the participation, vesting, funding and fiduciary responsibility
requirements of parts 2, 3 and 4 of Title I of ERISA.




SECTION ONE DEFINITIONS 




     “Act” shall mean the Securities Exchange Act of 1934, as amended or any similar or superseding
statute on statutes.



     “Account” shall mean, individually and collectively as the context requires, the Diversified
Account, Deferred Shares Account, and Company Account, which shall be established, as required, for
each Participant pursuant to Section Five. Without limitation, all Accounts established under this
Plan shall be bookkeeping entries only and shall be utilized solely as a device for the measurement
and determination of Participants’ Benefits.



     “Administrator” shall mean the person(s) designated to administer the Plan pursuant to Section
Two.



     “Beneficiary” shall mean the person(s), entity or entities described in Section Eleven.




     “Benefit” shall mean the Value (including, without limitation, the number of Deferred Shares)
of a Participant’s Account as of the Valuation Date of reference.



     “Board of Directors” shall mean the Board of Directors of the Company.



     “Bonus” shall mean the portion of Compensation paid to a Participant which is so designated by
the Company, which may be either regular or special, and which is payable to such Participant in
addition to such Participant’s Regular Pay during a Plan Year.



     “Change in Control” shall mean:



     (a) a dissolution or liquidation of the Company; or



 









 





     (b) a merger or consolidation (other than a merger effecting a re incorporation of the Company
in another state or any other merger or a consolidation in which the shareholders of the surviving
corporation and their proportionate interests therein immediately after the merger or consolidation
are substantially identical to the shareholders of the Company and their proportionate interests
therein immediately prior to the merger or consolidation) in which the Company is not the surviving
corporation (or survives only as a subsidiary of another corporation in a transaction in which the
shareholders of the parent of the Company and their proportionate interests therein immediately
after the transaction are not substantially identical to the shareholders of the Company and their
proportionate interests therein immediately prior to the transaction; provided, however, that the
Board of Directors may at any time prior to such a merger or consolidation provide by resolution
that there has been no Change in Control and that the foregoing provisions of this parenthetical
shall not apply if a majority of the Board of Directors of such parent immediately after the
transaction consists of individuals who constituted a majority of the Board of Directors
immediately prior to the transaction);



     (c) a transaction in which any person (other than a shareholder of the Company on the date of
the Optionee’s Participation Agreement) becomes the owner of fifty percent (50%) or more of the
total combined voting power of all classes of stock of the Company (provided, however, that the
Board of Directors may at any time prior to such transaction provide by resolution that there has
been no Change in Control and that this subparagraph of Section One shall not apply if such
acquiring person is a corporation and a majority of the Board of Directors of the acquiring
corporation immediately after the transaction consists of individuals who constituted a majority of
the Board of Directors immediately prior to the acquisition of such fifty percent (50%) or more
total combined voting power); or



     (d) any other transaction or series of transactions which the Board of Directors determines
has the effect of a Change in Control.



     “Code” shall mean the Internal Revenue Code of 1986, as amended.



     “Company” shall mean FelCor Lodging Trust Incorporated, a Maryland corporation.



     “Company Account” shall mean the Account, established pursuant to Section Five, which shall be
credited with Company Contributions, and related Earnings, and debited with distributions, all as
provided herein.



     “Company Contributions” shall mean the amount, if any, credited each Plan Year to a
Participant by and at the sole discretion of the Board of Directors, including, without limitation,
contributions which match a percentage of his Deferred Compensation.



     “Compensation” shall mean with respect to a Participant, the total wages, as defined in
section 3401(a) of the Code, before any deferrals hereunder or under any plan of the Employer;
provided, however, that no Deferred Pay may be deferred from car allowances, relocation payments,
sign-on bonuses, or from any other payments which are determined to be special payments by the
Administrator.



     “Contributions” shall mean, collectively, Deferred Pay, Company Contributions, Deferred
Unrestricted Shares, Deferred Option Shares, and Deferred Restricted Shares.



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     “Declaration of Hardship” shall mean the written request, and sworn declaration, filed by a
Participant with the Administrator setting forth the basis for such Participant’s requested receipt
of a Hardship Distribution.



     “Deemed Dividends” shall mean, with respect to each Participant’s Deferred Shares Account, the
product of (a) each cash dividend declared with respect to a Share, multiplied by (b) the number of
Deferred Shares credited to such Participant’s Deferred Shares Account as of the record date for
such dividends.



     “Default Earnings Rate” shall mean, for each day during a Quarter (which, without limitation,
shall be computed without compounding), a percentage equal to the product of (i), (ii) and (iii),
where (i) is the sum of the one (1) year London Interbank Offered Rate (“LIBOR”) as reported in the
Wall Street Journal as of (x) the first business day, plus (y) the last business day, of such
Quarter, (ii) is fifty percent (50%), and (iii) is a quotient of 1 divided by 360.



     “Deferred Bonus” shall mean the amounts deferred from a Participant’s Bonus(es) from the
Employer as a result of an Election to defer such Bonus.



     “Deferred Distribution” shall mean the distribution of a Participant’s Benefit later than the
date of his Separation.



     “Deferred Option Shares” shall mean the Deferred Shares credited to the Deferred Shares
Account as a result of an Election to defer Shares subject to an Option.



     “Deferred Pay” shall mean, collectively, Deferred Regular Pay and Deferred Bonus.



     “Deferred Regular Pay” shall mean the amounts deferred from a Participant’s Regular Pay as a
result of an Election to defer Regular Pay.



     “Deferred Restricted Shares” shall mean the Deferred Shares credited to a Participant’s
Deferred Shares Account as a result of an Election to defer Shares subject to restrictions which
cause them to be subject to a substantial risk of forfeiture.



     “Deferred Shares” shall mean, collectively, the Participant’s Deferred Unrestricted Shares,
Deferred Restricted Shares, and Deferred Option Shares; provided, further, that where a reference
to only one of the three classes of Deferred Shares is intended, reference shall be made expressly
to such class of Deferred Shares.



     “Deferred Shares Account” shall mean the Account, established pursuant to Section Five, to
which is credited with Deferred Shares as provided herein.



     “Deferred Unrestricted Shares” shall mean the Deferred Shares credited to a Participant’s
Deferred Shares Account as a result of an Election to defer Shares which have not yet been
delivered but which will not be subject to a substantial risk of forfeiture at the time they would
have been delivered except for the Election.



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     “Designated Subsidiaries” shall mean entities affiliated with the Company which have been
designated by the Board of Directors from time to time as eligible to adopt this Plan for the
benefit of their Eligible Persons.



     “Directed Investments” shall mean the notational investments recorded on the books of the
Employer or the Trustee, if any, with respect to the Diversified Account, and Company Account,
respectively, of each Participant.



     “Director” shall mean a non-Employee member of the Board of Directors.



     “Disability” shall mean that an individual is unable to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment which can be
expected to result in death or which has lasted, or can be expected to last, for a continuous
period of not less than twelve (12) months.



     “Diversified Account” shall mean the Account, established pursuant to Section Five, which
shall be credited with Deferred Pay, and related Earnings, and debited with corresponding
distributions, all as provided herein.



     “Earnings” shall mean the amount credited or debited to an Investment Account based upon the
Fair Market Value of the Participant’s Directed Investments (including, without limitation,
unrealized appreciation or depreciation) calculated as though the Participant had actually
purchased, held, or sold, as the case may be, the Investment of reference in accordance with his
Investment Direction; and provided, further, that the closing price of each such Investment,
determined in the same manner as the Fair Market Value of Shares, shall be deemed to be its Value
on the date of reference for all purposes of the Plan. Earnings shall also include any amount
credited to the Deferred Shares Account which is attributable to a Deemed Dividend.



     “Effective Date” shall mean January 1, 2005.



     “Election” shall mean the filing of the form, prepared and distributed by the Administrator,
in which the Participant directs or elects with respect to various matters described herein as
being subject to his or her election or direction; and the applicable provisions of each such
Election shall remain in effect until changed by the timely and effective filing of a subsequent
Election.



     “Eligible Person” shall mean each Qualified Person selected as eligible to participate in the
Plan by the Administrator, and each Director.



     “Employee” shall mean a common law employee of the Employer.



     “Employer” shall mean, collectively, the Company and each Designated Subsidiary.



     “Enrollment Form” shall mean a form prepared by the Administrator in which the Participant:



     (i) agrees to become a Participant and agrees to the terms and provisions of the
Plan;



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     (ii) waives his or her right to assert, perfect, or secure any lien pursuant to any Texas
statute, including, but not limited to, Ann. Tex. Prop. Code § 58.004 or any superseding section of
the Ann. Tex. Prop. Code; and



     (iii) specifies his Planned Early Withdrawal Date.



     “Entry Date” shall mean first day of the Payroll Period designated by the Participant on a
timely filed Election.



     “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended.



     “Fair Market Value” of a Share on the Valuation Date of reference shall be the closing price
of Stock on such date, which shall mean:




     (i) If Shares of the same class are listed or admitted to unlisted trading privileges
on the New York Stock Exchange at the date of determining the Fair Market Value, the last
reported sale price on such exchange on the last business day prior to the date in question;
or




     (ii) If Shares of the same class shall not be listed or admitted to unlisted trading
privileges on the New York Stock Exchange and sales prices for such shares in the
over-the-counter market shall be reported by the NASDAQ Stock Market (“NASDAQ”) National
Market System at the date of determining the Fair Market Value, the last reported sale price
so reported on the last business day prior to the date in question; or




     (iii) If Shares of the same class shall not be listed or admitted to unlisted trading
privileges on either the New York Stock Exchange or the NASDAQ National Market System, and
bid and asked prices therefor in the over-the-counter market shall be reported by NASDAQ
(or, if not so reported, by the National Quotations Bureau Incorporated or the OTC Bulletin
Board) at the date of determining the Fair Market Value, the average of the closing bid and
asked prices on the last business day prior to the date in question; and




     (iv) If Shares of the same class shall not be listed or admitted to unlisted trading
privileges on the New York Stock Exchange and sales prices or bid and asked prices for such
shares shall not be reported by NASDAQ (or the National Quotations Bureau Incorporated) at
the date of determining the Fair Market Value, the value determined in good faith by the
Administrator in good faith, without limitation, shall be final, binding and conclusive on
all parties.



     “Final Filing Date” shall mean, with respect to all Elections, the later of the 30th day
following designation as an Eligible Employee (so long as it is prior to actual receipt (or Lapse
Date) of the Compensation to be deferred) and, individually and not collectively, the date(s)
described below:



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     (i) Deferred Regular Pay. With respect to Elections of Deferred Regular Pay taking
effect in the first full Payroll Period in the succeeding Plan Year, the last day of the
current Plan Year; and with respect to Elections of Deferred Regular Pay taking effect in
the first full Payroll Period of any Quarter (other than the first), the last day of the
second month in the immediately preceding Quarter.




     (ii) Deferred Bonus(es). The later of (i) the 60th day prior to the date on which the
Bonus is scheduled to be paid, and (ii) the receipt of notice of the amount of Bonus
scheduled to be paid.




     (iii) Restricted Shares. The 180th day prior to the Lapse Date with respect to the
Restricted Share(s) of reference.




     (iv) Option Shares. The 30th day prior to the date on which the Option is exercised.




     (v) Unrestricted Shares. The later of (x) the thirtieth (30th) day prior to the date
the Administrator determines to be the scheduled delivery date of the Unrestricted Shares,
and (y) the date on which the Company completes the action which the Administrator
determines to have legally established a Participant’s unqualified right to receive the
Unrestricted Shares at some future time.




     (vi) Changing Planned Early Withdrawal Date. The 366th day prior to the current
Planned Early Withdrawal Date.




     (vii) Electing Deferred Distribution. The 180th day prior to the date on which the
payment of Benefits is made or commenced (disregarding, for this purpose, any Hardship
Withdrawals.)




     (viii) Requesting Share Distributions. The 5th day prior to the date on which the
payment of Benefits is made or commenced (disregarding, for this purpose, any Hardship
Withdrawals).



     “For Cause” shall mean a Separation which is the result of either (a) a Participant’s material
failure or refusal to perform his duties if the Participant has failed to cure such failure or
refusal to perform within thirty (30) days after the Employer notifies the Participant in writing
of such failure or refusal to perform, or (b) based upon his commission of any of the following:




     (i) an intentional act of fraud, embezzlement or theft in connection with his duties or
in the course of his employment with the Employer;




     (ii) intentional wrongful damage to property of the Employer or any other willful gross
misconduct that causes material economic harm to the Employer or that brings substantial
discredit to the Employer’s reputation;




     (iii) intentional wrongful disclosure of trade secrets or confidential information of
the Employer;



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     (iv) willful violation of any law, rule or regulation (other than traffic violations or
similar offenses) or final cease and desist order, including, but not limited to, a final,
nonappealable conviction of a Participant for commission of a felony involving moral
turpitude; or




     (v) intentional breach of fiduciary duty owed to the Employer involving personal
profit.



     For the purpose of this Plan, no act, or failure to act, on the part of the Participant shall
be deemed “intentional” unless the Board of Directors finds that the act or failure to act was
done, or omitted to be done, by the Participant in other than good faith and without reasonable
belief that his action or omission was in the best interest of the Employer. Any determination
that a Participant has been terminated For Cause shall be made solely by the Board of Directors.



     “Hardship” shall mean an unforeseeable emergency that would result in severe financial
hardship to the Participant, if a Hardship Withdrawal were not permitted, and which results from
(i) the death of family member, (ii) divorce, (iii) a sudden or unexpected illness, accident or
catastrophe to the Participant or a dependent of the Participant, (iv) loss of property (including
casualty loss, foreclosure of primary residence, and eviction from primary residence), or (v) other
extraordinary events beyond the Participant’s control, all as determined by the Administrator.



     “Hardship Withdrawal” shall mean the withdrawal made by reason of a Hardship in accordance
with the provisions of Section Ten.



     “Installment Payments” shall mean payments of a Participant’s Vested Benefit in not less than
Quarterly installments over a period not in excess of ten (10) years.



     “Invested” and similar terms shall mean, for convenience of reference herein, the
Administrator’s notational crediting of amounts to Directed Investments, but shall not require the
Company or the Trust to actually purchase such assets.



     “Investment Account” shall mean, collectively, a Participant’s Diversified Account, and
Company Account.



     “Investment Direction” shall mean the direction of the Investment by the Participant of the
amount in his Investment Account. Such direction may, but need not, result in the notational
crediting of funds in the designated Investment. A Participant shall have no right to be credited
with Directed Investments and shall have no claim against the Administrator, the Trustee or the
Employer for a failure to follow an Investment Direction; provided, however, that should the
Administrator fail or refuse to follow a Participant’s Investment Direction (and so notify
Participant) with respect to some or all funds in such Participant’s Investment Account, then such
Investment Account will be credited with Earnings, with respect to funds for which an Investment
Direction is refused, at the Default Earnings Rate, until an Investment Direction with respect to
such funds is accepted by the Administrator.



     “Investment Rules” shall mean, collectively, the procedures regarding the availability of
Investments which are adopted by the Administrator at the time of reference and which, without



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limitation, may be changed in any manner by the Administrator; and provided, further, without
limitation, that unless otherwise expressly provided by the Administrator in promulgating such
procedures, the Administrator, at a minimum, shall have until the 15th day of the month following
the month in which an amount is initially credited to a Participant’s Account, or a change in a
prior Investment Direction is requested by the Participant, to notationally Invest such amount in
an Investment; and provided, further, that prior to the earlier of such actual notational
Investment on the books of the Administrator, or such 15th day, such amount, if a newly credited
amount, shall not be considered Invested, and if previously Invested, shall be considered Invested
in accordance with the prior Investment Direction.



     “Investment” shall mean, individually and collectively as the context requires, the
investment alternatives available under the Investment Rules at the time of reference, and Deferred
Shares.



     “Lapse Date” shall mean, with respect to Restricted Shares, the date on which the restrictions
lapse.



     “Lump Sum” shall mean a single payment, in cash, or Shares, or both, of the Participant’s
entire Vested Benefit.



     “Normal Retirement Date” shall mean the Participant’s 65th birthday.



     “Option” shall mean, individually and collectively as the context requires, all of a
Participant’s Option(s) granted by the Employer to acquire Shares.



     “Participant” shall mean each person who has a Benefit at the time of reference.



     “Payroll Period” shall mean each of the periods during a Plan Year with respect to which
Participants are paid Compensation.



     “Plan” shall mean this FelCor Lodging Trust Incorporated Non-Qualified Deferred Compensation
Plan, as now or hereafter amended.



     “Plan Year” shall mean the calendar year.



     “Planned Early Withdrawal Date” shall mean the date, if any, selected by the Participant for
receipt of his Vested Benefit prior to his Separation; provided, however, that if the Participant
wishes to file a new Planned Early Withdrawal Date Election in order to delay distribution to a
later date, that later date must be at least twelve (12) months after the current Planned Early
Withdrawal Date.



     “Qualified Person” shall mean (i) an Employee who is a Qualifying Investor and a member of
management of the Employer, a highly compensated Employee of the Employer, or an officer of the
Employer, as determined by the Administrator, or (ii) a Director.



     “Qualifying Investor” shall mean an individual who has annual Compensation of at least
$100,000, and who meets other minimum financial requirements as determined by the Administrator.



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     “Quarter” shall mean the calendar quarter.



     “Regular Pay” shall mean all Compensation which is not a Bonus.



     “Rules of General Application” shall mean those rules promulgated by the Administrator, in its
sole discretion, from time to time with respect to the matter of reference, but which will be
applied in a similar manner to Participants similarly situated.



     “Securities Act” shall mean the Securities Act of 1933, as amended, or any similar or
superseding statute or statutes.



     “Separates,” “Separated,” or “Separation” shall mean an Employee’s ceasing to be an Employee
by reason of a termination of employment with the Employer for any reason (including death or
Disability), and a Director’s ceasing to serve on the Board.



     “Shares” shall mean shares of Stock.



     “Stock” shall mean the common stock, $0.01 par value per share, of the Company.



     “Stock Plan” shall mean, collectively, all of the FelCor Lodging Trust Incorporated’s stock
plans, as adopted or amended from time to time.



     “Trust” shall mean a trust which substantially conforms to the model rabbi trust provided in
section 5 of the Internal Revenue Service’s Revenue Procedure 92-64, 1992-2 C.B. 422, that may be
established between the Company and the trustee(s) named in the Trust.



     “Trustee” shall mean the person appointed to serve as Trustee of the Trust, if any, at the
time of reference.



     “Valuation Date” shall mean each date on which the New York Stock Exchange is operating.



     “Value” shall mean the value of Investments, the Fair Market Value of a Share, or the value of
an Account, as the context requires, determined as provided hereunder.



     “Vested” shall mean that the amount, or property, referred to as nonforfeitable and, without
limitation, “nonVested” shall mean that such amount, or property, is forfeitable.



SECTION TWO ADMINISTRATION




     (a) Employer Duties. The Employer shall, upon request or as may be specifically
required under the Plan, furnish or cause to be furnished all of the information or documentation
in its possession or control which is necessary or required by the Administrator to perform its
duties and functions under the Plan.



     (b) Board of Directors’ Duties. The Board of Directors shall, upon request by the
Administrator or as may be specifically required under the Plan, furnish or cause to be furnished



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all of the information or documentation in its possession or control which is necessary or
required by the Administrator to perform its duties and functions under the Plan.



     (c) Appointment of Administrator. The Compensation Committee of the Board of
Directors shall serve as the Administrator, unless the Board of Directors appoints one or more
other persons in writing to serve as Administrator. In the event that the Compensation Committee
of the Board of Directors ceases to exist or in the event the Administrator has not been
effectively appointed hereunder at the time of reference, the Company shall be the administrator.



     Any Administrator appointed hereunder who shall be an Employee shall serve without
compensation; and any such person shall automatically cease to be an Administrator upon his or her
termination of employment with the Employer. An Administrator may resign at any time by giving
thirty (30) days prior written notice to the Board of Directors. The Company may remove an
Administrator at any time by written notice, with or without cause, and may appoint a successor
Administrator.



     If at any time there shall be two (2) or more persons acting as Administrator, such persons
shall conduct the business of the Administrator by meetings, held from time to time at their
discretion, and the actions of the Administrator shall be determined by majority vote, which may be
made by telephone, wire, cable or letter; and the Administrator may designate, in writing, one (l)
or more of its members who shall have authority to sign or certify that any action taken by the
Administrator represents the will of, and is binding on, the Administrator.



     The Administrator shall acknowledge the assumption of his or her duties hereunder in writing,
or shall endorse a copy of this Plan.



     (d) Duties of Administrator. The Administrator shall be responsible for establishing
and carrying out the objectives of the Plan, in accordance with its terms.



     (e) Authority of Administrator. The Administrator shall have the sole authority and
responsibility for administering the Plan.



     (f) Powers of Administrator. The Administrator shall have sole and exclusive
authority and responsibility for administering, construing and interpreting the Plan, and of
appointing the Trustee, and of maintaining a record of Investments. The Administrator shall have
all powers and discretion as may be necessary to discharge its duties and responsibilities under
this Plan, including, but not by way of limitation, the power, in its sole and absolute discretion,
(i) to interpret or construe any and all provisions of the Plan, (ii) to make rules and regulations
for the administration of the Plan, (iii) to develop Rules of General Application, (iv) to
determine all questions of eligibility, status and other rights of Participants, Beneficiaries and
other persons, (v) to determine the amount, manner and time of the payment of any Vested Benefits,
and (vi) to resolve any dispute which may arise under this Plan involving Participants or
Beneficiaries. The Administrator may engage agents to assist it and may engage legal counsel, who
may be counsel for the Company. The Administrator shall not be responsible for any action taken or
not taken on the advice of such counsel.



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     No member of the Administrator shall vote or act upon any discretionary matter involving his
own Benefits and in such case, the remaining member or members of the Administrator shall appoint a
member pro-tem to act in the place of the interested member; provided, however, that if all members
of the Administrator shall be disqualified under this paragraph (f) of Section Two with regard to
one or more matters, the President of the Company shall appoint a qualifying person(s) to be the
Administrator with regard to such matters.



     (g) Bond and Expenses of Administrator. The Administrator shall serve without bond
unless state or federal statutes require otherwise, in which event the Employer shall pay the
premium. The expenses of the Administrator shall be paid by the Employer. Such expenses shall
include all expenses incident to the functioning of the Administrator, including, but not by way of
limitation, fees of accountants, counsel and other specialists and other costs of administering the
Plan.



     (h) Administrator Records and Reports. The Administrator shall maintain, or cause to
be maintained, adequate records of all of its proceedings and acts, and all such books of account,
records, and other data as may be necessary for administration of the Plan, including, but not
limited, to administering the Investment Directions as provided herein. The Administrator shall
make available to each Participant upon his request such of the Plan’s records as pertain to him
for examination at reasonable times during normal business hours.



     (i) Reliance on Tables. In administering the Plan, the Administrator shall be
entitled to the extent permitted by law to rely conclusively on all tables, valuations,
certificates, opinions and reports which are furnished by accountants, legal counsel or other
experts employed or engaged by the Administrator.



SECTION THREE PARTICIPANTS




     (a) Eligibility. Participation in the Plan shall be limited to Eligible Persons, and
the Administrator shall notify each such Eligible Person, in writing, of their status.



     (b) Participation. An Eligible Person shall become a Participant by completing and
executing an Enrollment Form, at least one Election, and such other forms as may be required by the
Administrator. At such time, if ever, as a Participant is determined by the Administrator to no
longer be a Qualified Person, such Participant’s Contributions hereunder shall cease effective for
all periods (including without limitations all Payroll Periods) following the date of such
determination.



     (c) Agreement to Be Bound. By becoming a Participant, each Eligible Person shall for
all purposes be deemed conclusively to have assented to the provisions of this Plan and to all
amendments to this Plan.



SECTION FOUR CONTRIBUTIONS AND ELECTIONS




     (a) Deferred Pay. A Participant will be credited with his Deferred Pay in accordance
with the provisions of the Plan.



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     (b) Deferred Shares. A Participant will be credited with Deferred Shares equal to the
sum of his or her Deferred Unrestricted Shares, Deferred Restricted Shares, and Deferred Option
Shares.



     (c) Company Contributions. The Board of Directors may in its sole discretion (but
shall have no obligation to) credit a specific amount of Company Contributions to any one or more
Participant(s), and may make each Company Contribution with respect to a Participant subject to
such Vesting requirements as, in its sole discretion, are appropriate.



     (d) Elections. Only the last Election delivered to the Administrator on or before the
Final Filing Date of reference will be considered the Election of the Participant with respect to
the matter of reference; provided, however that Elections with respect to Unrestricted Shares,
Restricted Shares, or Option Shares shall be irrevocable on the date they are filed.
Notwithstanding any provision hereof to the contrary, if a Participant is determined to have
suffered a Hardship, and regardless of whether such Participant receives a Hardship Withdrawal, the
Participant will be permitted to file an Election discontinuing Deferred Pay as of the next Payroll
Period.



     Once filed, an Election with respect to Deferred Pay shall remain in effect, including without
limitation, with respect to subsequent Plan Years, until changed by the timely filing of a new
Election with respect to Deferred Pay. A Participant shall be permitted to file no more than three
(3) Elections affecting the rate or amount of Deferred Pay with respect to a Plan Year.



     (e) Furnishing of Elections. The Administrator shall provide any one or more Election
form(s) to each Eligible Person and Participant upon request.



     (f) Administrator Discretion to Reject or Modify Elections. Notwithstanding anything
in this Section Four to contrary, the Administrator may refuse to accept, or may require a
Participant to modify, any Elections made by a Participant under this Section Four.



     (g) Cessation of Deferrals and Contributions Under Plan. Notwithstanding anything
herein to the contrary, no amounts that are deferred or become vested on or after January 1, 2005
shall be governed by this Plan, but instead such amounts shall be governed by the terms of the
FelCor Lodging Trust Incorporated 2005 Nonqualified Deferred Compensation Plan.



SECTION FIVE ACCOUNTS AND INVESTMENT DIRECTIONS 




     (a) Establishment of Accounts. The Employer shall establish and maintain a
Diversified Account, a Deferred Shares Account, and a Company Account in the name of each
Participant.



     (b) Amounts Credited to Diversified Account. A Participant’s Deferred Pay shall be
credited to the Participant’s Diversified Account as of the Valuation Date next following the date
of deferral.



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     (c) Amounts Credited to the Company Account. Company Contributions, if any, shall be
credited to the Company Account as of the Valuation Date next following the date designated in
writing by the Company as the date of contribution.



     (d) Earnings Credited to Investment Account. The Administrator shall credit each
Participant’s Diversified Account and Company Account as of each Valuation Date with its Earnings
since the next preceding Valuation Date; except the Administrator will credit the amount
attributable to any Default Earnings Rate to such Account as of the last Valuation Date of each
Quarter.



     (e) Amounts Credited to Deferred Shares Account. All Deferred Shares of a Participant
shall be credited to his Deferred Shares Account.



     (f) Investment Direction. On such form, in the manner and at such times as the
Administrator prescribes, and subject to the Investment Rules, each Participant may select among
the different Investments with respect to the Investment of the amounts credited to his Diversified
Account and Company Account. Any direction by the Participant shall be recorded on the books of
the Company in accordance with the Investment Rules; provided however, without limitation, (i) the
Administrator is not required to accept the Investment Directions given by the Participant, but in
order to reject an Investment Direction in whole or in part, the Administrator must notify the
Participant of such rejection, in writing, within five days following receipt of the Investment
Direction of reference; provided further that, in the absence of such notice, such Investment
Direction shall be binding on the Administrator and the Participant; and (ii) the Company and/or
the Trustee may, but shall not be required to, make actual corresponding investments.



     (g) Valuation of Accounts. As of each Valuation Date, a Participant’s Account shall
consist of the Value of the Participant’s Account as of the next preceding Valuation Date, adjusted
by (i) crediting Contributions, (ii) crediting or debiting Earnings, and (iii) debiting
distributions, which have been credited, made, earned, or distributed since the immediately
preceding Valuation Date.



     (h) Statements. Within sixty (60) days after the end of each Plan Year and at such
other times during the Plan Year as shall be determined by the Administrator, the Administrator
shall furnish each Participant with a statement showing the Value of such Participant’s Benefit as
of the last Valuation Date in the preceding Quarter.



SECTION SIX VESTING




     (a) Vesting. A Participant is always 100% Vested in the amount in his Diversified
Account and Deferred Share Account. Except as provided in (b), a Participant shall be 100% Vested
in the amount in his Company Account unless, prior to the date on which a Company Contribution is
credited to a Participant’s Company Account, the Company notifies the Administrator, in writing,
that the Company Contribution of reference will be subject to the Vesting schedule set forth in
such written notice. The Administrator shall establish a one or more separate sub-account(s) under
the Company Account to hold nonVested Company Contributions, and shall credit each such
sub-account only with Company Contributions which,



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under every circumstance, Vest on exactly the same date and in the same percentage. Each such
sub-account shall operate in all respects as if it were a separate Company Account of such
Participant, i.e. except for Vesting, all references hereunder to Company Account shall be deemed a
reference to each sub-account, individually and collectively, as the context requires.



     (b) Separation for Cause. Notwithstanding any provision hereof to the contrary,
including (a) above, if a Participant is Separated For Cause, such Participant shall permanently
forfeit one hundred percent (100%) of the amount in his Company Account on the date of his
Separation for Cause.



     (c) Disposition of Forfeitures. Forfeitures may be used for any corporate purpose,
including, without limitation, allocation as Company Contributions.



SECTION SEVEN PAYMENT 




     (a) Separation Prior to Age 55. Notwithstanding any provision hereof to the contrary,
each Participant who Separates prior to age 55 for any reason shall receive a Lump Sum distribution
as soon as administratively practicable after the date of Separation.



     (b) Separation After Age 55 — Deferred Distribution. Each Participant who Separates
after age 55 for any reason shall receive a distribution as provided in (a) unless he has properly
elected a Deferred Distribution.



     (c) Distribution on Planned Early Withdrawal Date. Unless an earlier distribution has
been made in accordance with the provisions of paragraph (a), a Participant may elect to receive
distribution(s) commencing on his Planned Early Withdrawal Date in a Lump Sum or in Installment
Payments.



     (d) Lump Sum Required For Small Amounts.  Notwithstanding any provision hereof to the
contrary, if the Value of a Participant’s Account shall be less than $10,000 on the date of his
Separation, such Participant shall receive his or her distribution in a Lump Sum distribution as
provided in paragraph (a).



     (e) Form of Payment. Any payment of Vested Benefits attributable to amounts in the
Participant’s Investment Account shall be made in cash or, at the request of the Participant and
subject to approval by the Administrator, in whole or in part in Shares; and any Benefits
attributable to Deferred Shares credited under the Deferred Shares Account shall be distributed in
the form of an equal number of Shares.



     (f) Calculation of Installment Payment. If Participant has elected distribution in
the form of Installment Payments, he shall receive on each payment date an amount equal to the
product of (a) his Vested Benefit, calculated separately with respect to (i) his Investment
Account, and (ii) his Deferred Shares Account, multiplied by (b) a fraction the numerator of which
is one (1), and the denominator of which is the total number of installments originally elected
less the number of installments already paid. A Participant’s Account will continue to be subject
to all provisions of the Plan including, without limitation, the crediting of Earnings, during the
period of any Installment Payment. No distribution of fractional Shares shall be made. Any
fraction shall accumulate until at least a whole Share may be distributed.



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     (g) Payments Upon Other Events Determined by the Administrator. The Administrator
may, subject to Participant approval, accelerate in whole or in part (but not in an amount less
than Five Thousand Dollars ($5,000)) the payment of Vested Benefits to such Participant to any date
selected by the Participant, subject to a reduction (and permanent forfeiture) of the amount of the
Participant’s Vested Benefit at the date of distribution equal to ten percent (10%) of the amount
of the distribution, which amount shall be deducted from the Participant’s undistributed Vested
Benefit, or, to the extent it exceeds the amount of such undistributed Vested Benefit, then from
the amount of the distribution. In addition, and without limitation, the Administrator may
accelerate the distribution of all (but not less than all) of a Participant’s Vested Benefits
following the date, prior to his Separation, on which he no longer is a Qualified Person; provided,
further, that such acceleration shall not result in the deduction of any amount from such
Participant’s Benefit.



     (h) Elections After Planned Early Withdrawal Date and After Separation. A Participant
who receives a distribution on his Planned Early Withdrawal Date may continue to elect
Contributions under the Plan so long as he remains an Eligible Person.



SECTION EIGHT SOURCE OF PAYMENT




     All cash payments will be made from the assets of the Trust, except, if such assets are
exhausted, such payments shall be made from the general assets of the Employer; provided, without
limitation, that the creation and funding of the Trust does not create a special or separate fund
or segregation of either cash, assets or Shares which will assure such payments in such a way as to
make this Plan a “funded” plan for purposes of ERISA or the Code. Notwithstanding anything in the
Plan to the contrary, upon the occurrence of a Change in Control, the Employer agrees, and is
hereby required, to appoint a bank or similar professional corporate fiduciary to be the Trustee of
the Trust.



     Nothing contained in the Plan, nor any action taken pursuant to the provisions of the Plan,
shall create or be construed to create a fiduciary relationship between the Employer and a
Participant, Beneficiary, employee or other person. To the extent that any person acquires a right
to receive payments from the Employer under the Plan, such right shall be no greater than the right
of any unsecured general creditor of the Employer.



     For purposes of the Code, the Employer intends this Plan to be an unfunded, unsecured promise
on the part of the Employer to pay in the future. For purposes of ERISA, the Employer intends the
Plan to be an unfunded plan primarily for the benefit of a select group of management or highly
compensated employees of the Employer for the purpose of qualifying the Plan for the “top hat” plan
exception under sections 201(2), 301(a)(3) and 401(a)(1) of ERISA.




			
	SECTION NINE	 	PROVISIONS RELATING TO DEFERRED SHARES CREDITED TO THE DEFERRED SHARE
ACCOUNT





     (a) Adjustments Upon Changes in Capitalization. If a stock dividend, stock split,
spinoff, recapitalization, merger, consolidation, exchange of shares or the like, occurs, as a
result of which shares of any class shall be issued with respect to Shares, or such Shares shall be
changed into a different number of the same or another class or classes, the number of Deferred



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Shares credited to the Deferred Share Accounts or of Participants and the calculation of the
Fair Market Value of such Deferred Shares shall be appropriately adjusted (effective as of the date
of such event) by the Administrator in a manner that will make the Deferred Shares have a Fair
Market Value as of the date of such event which is equal to the Fair Market Value of the Shares,
plus the consideration received by shareholders with respect to Shares, as a result of such event.



     (b) Conditions upon Issuance of Shares. Notwithstanding any provision hereof to the
contrary, Shares shall not be issued unless such issuance and delivery shall comply with all
applicable provisions of law, domestic or foreign, including, but not limited to the Securities
Act, and the requirements of any stock exchange upon which the Shares may then be listed,
including, in each case the rules and regulations promulgated thereunder, and shall be further
subject to the approval of counsel for the Company with respect to such compliance, which may
include a representation and warranty from the Participant that the Shares are being acquired only
for Investment for his own account and without any present intention to publicly sell or distribute
such Shares without an exemption from or compliance with applicable securities laws. Any Shares so
issued may bear such restrictive legend as counsel for the Company may deem necessary or advisable
to assure compliance with such laws.



     (c) Deemed Dividends. The Deemed Dividends shall be credited to a Participant’s
Diversified Account.



     (d) Voting and Registration. A Participant will have no beneficial or record interest
or voting right in or other privileges relating to Shares as a result of the crediting of Deferred
Shares to his Deferred Shares Account, and will obtain such rights and privileges only upon the
issuance of a certificate representing the equivalent Shares.



     (e) Execution of Receipts and Releases. Any payment or any issuance or transfer of
Shares to any person shall be in full satisfaction of all claims hereunder against the Plan, and
the Administrator may require such person, as a condition precedent to receiving delivery of
Shares, to execute a receipt and release therefor in such form as it shall determine.



SECTION TEN HARDSHIP WITHDRAWALS




     (a) Amount of Hardship Withdrawal. A Participant who is determined to have suffered a
Hardship may be paid a Hardship Withdrawal of the amount which the Administrator determines is
necessary to reasonably alleviate such Hardship.



     (b) Penalty Limitation on Deferred Pay Contributions. In the event of a Hardship
Withdrawal, the withdrawing Participant’s Election with respect to Deferred Pay Contributions
automatically will be discontinued effective with the Payroll Period immediately following the
filing of the Declaration of Hardship, and such Participant shall not be entitled to recommence
Deferred Pay Contributions until the first Payroll Period following the first anniversary of the
filing of the Declaration of Hardship.



SECTION ELEVEN DESIGNATION OF BENEFICIARIES




     (a) Designation by Participant. A Participant’s written designation of one or more
persons or entities as his Beneficiary shall operate to designate the Participant’s Beneficiary



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under this Plan. The Participant shall be entitled to file with the Administrator a copy of
his Beneficiary designation under the Plan on a form supplied to the Participant by the
Administrator. The last such designation received by the Administrator shall be controlling, and
no designation, or change or revocation of a designation shall be effective unless received by the
Administrator prior to the Participant’s death. If the Participant is married on the date of
filing his Beneficiary Designation, he must obtain the written consent of his spouse unless such
spouse is designated to receive at least fifty percent (50%) of his Benefit.



     (b) Lack of Designation. If no Beneficiary designation is filed and in effect at the
time of a Participant’s death, if no designated Beneficiary survives the Participant, or if the
otherwise applicable Beneficiary designation conflicts with applicable law, the Participant’s
estate shall be the Beneficiary. The Administrator may direct the Employer to retain any unpaid
Vested Benefit, without liability for any interest, until all rights to the unpaid Vested Benefit
are determined. Alternatively, the Administrator may direct the Employer to pay such Vested
Benefit into any court of appropriate jurisdiction. Any such payment shall completely discharge
the Employer of any liability under the Plan.



SECTION TWELVE AMENDMENT OR TERMINATION




     (a) Amendment or Termination. Except as to the last sentence in the first paragraph
of Section Eight, and this Section Twelve, the Plan may be amended, suspended or terminated, in
whole or in part, by the Board of Directors, but no such action shall retroactively impair the
rights of any person to payment of such person’s Vested Benefit (provided, without limitation, that
the date of payment may be accelerated); provided, further, that the Plan may be amended by the
Administrator with respect to any matters which the Administrator determines to involve primarily
clarification of one or more provisions the Plan, or relate primarily to Plan administration.



     (b) Partial Termination of Plan. In accordance with paragraph (a) of this Section
Twelve, (i) as of November 15, 2006, the Plan shall be terminated with respect to each Deferred
Shares Account maintained on behalf of each Employee or former Employee and (ii) as of March 3,
2007, the Plan shall be terminated with respect to each Deferred Shares Account maintained on
behalf of each Director or former Director. Subject to paragraph (h) of Section Thirteen, each
Deferred Shares Account terminated pursuant to this paragraph shall be distributed to the affected
Participant, or his or her Beneficiary, as of the applicable termination date, in accordance with
paragraph (e) of Section Seven. After such termination dates, no Account under this Plan shall be
credited with units representing Shares of Stock.



     (c) Substantial Reduction in Benefits. Without limiting the generality of any other
provision hereof, if the Administrator, in its sole discretion, determines that a proposed
amendment to the Plan would result in a substantial reduction in either the rights or benefits of
Participants under the Plan, the Administrator must give each Participant notice of the amendment
not less than 60 days prior to the earlier of its adoption or its effective date, and must allow
each Participant to waive the right to elect an immediate distribution as described below. In the
absence of such timely waiver, each Participant shall have the right, for a period of 90 days
commencing on the later of the adoption, or the effective date, of such amendment, to elect,



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in a writing filed with the Administrator, to have all (but not less than all) of his Vested
Benefit distributed to him as soon as reasonably possible.



SECTION THIRTEEN GENERAL PROVISIONS




     (a) No Assignment. The right of any Participant or other person to the payment of a
Benefit shall not be assigned, transferred, pledged or encumbered, either voluntarily or by
operation of law, except as provided in Section Eleven with respect to designations of
Beneficiaries. If any person shall attempt to assign, transfer, pledge or encumber any portion of
such Benefit, or if by reason of bankruptcy or other event happening at any time any such payment
would be made subject to debts or liabilities or would otherwise devolve upon anyone else and not
be enjoyed by such person, the Administrator may terminate such person’s interest in any such
payment and direct that the same be held and applied to or for the benefit of such person, his
spouse, children or other dependents, or any other persons deemed to be the natural objects of his
bounty, or any of them, in such manner as the Administrator may deem proper.



     (b) Incapacity. If the Administrator shall find that any person is unable to care for
his affairs because of illness or accident or is a minor, any payment due (unless a prior claim for
such payment shall have been made by a duly appointed guardian, committee or other legal
representative) may be paid to his spouse, a child, a parent, or a brother or sister, or any other
person deemed by the Administrator to have incurred expenses for such person otherwise entitled to
payment, in such manner and proportions as the Administrator may determine. Any such payment shall
be a complete discharge of the liabilities of the Employer under the Plan as to the amount paid.



     (c) No Guarantee of Deferral. While the Company intends that this Plan will result
in the deferral of the imposition of a federal income tax on the funds credited hereunder until
such time as they actually shall be paid to a Participant, nothing herein shall be construed as a
promise, guarantee or other representation by the Company of such tax effect nor, without
limitation, shall the Company be liable for any taxes, penalties or other amounts incurred by
Participants in the event it is determined by applicable authorities that such deferral was not
accomplished, and each Eligible Person electing to become a Participant should consult his or her
own tax advisor(s) to determine the tax consequences in his or her specific case, and their
suitability for participation in this Plan.



     (d) Resolution of Disputes Relating to Plan. If you make a written request for
Benefits and your request is partially or wholly denied, the Administrator will explain, in
writing, the basis for the denial. This will ordinarily be done in 90 days; but, in unusual
circumstances, this period may be extended by up to 90 additional days if you are given notice of
the extension during the additional 90-day period. The written notification from the Administrator
will tell you if any information is needed to complete the processing of your claim to Benefits and
explain why the information is needed. In addition, the notification will tell you how and when an
appeal should be made.



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     The appeal process is as follows:




	 	(i)	 	After you receive notice of denial of Benefits, you may appeal to the
Administrator, in writing, within 60 days. If you do not make your written appeal
within 60 days, the original decision of the Administrator will become final.
	 
	 	(ii)	 	You may include in your written appeal any reasons for appeal and any
information to support your rights to benefits. You may use legal assistance and you
may examine any related Plan documents.
	 
	 	(iii)	 	The Administrator will then reexamine all of the facts and come to a final
decision. You will be notified of this decision within 60 days of the time you submit
your written appeal unless there are special circumstances, such as a hearing. You
will be notified if an extension is required. However, in no case will you receive the
Administrator’s decision later than 120 days after your appeal is received. The notice
of final decision will include specific reasons for the decision and identify the Plan
provisions relied upon in making the decision.





     If, after the exhaustion of the claims procedure set forth above, one or more disputes remain
with regard the rights under the Plan of any Employee, Participant, Beneficiary or person claiming
under them, such person(s) and the Administrator (collectively, “Interested Parties”) agree to
attempt to resolve same by telephone conference with an agreed mediator. If the Interested Parties
cannot resolve their differences by such telephone conference, then the Interested Parties agree to
schedule a one day mediation with a mediator who is mutually agreeable to the Interested Parties,
within thirty (30) days to resolve the disputes and to share equally the costs of such mediation.
If one of the Interested Parties refuses to mediate, then such Interested Party thereby waives any
recovery for attorneys’ fees or costs incurred in any arbitration brought to construe or enforce
the provisions of this Plan. If the Interested Parties are unable to resolve their dispute by
mediation, the Interested Parties may institute an arbitration proceeding under the auspices of the
American Arbitration Association to construe or enforce the provisions of the Plan. The
Interested Parties hereby waive their right to institute litigation in a court of law to resolve a
dispute concerning the construction or enforcement of this Plan. The Interested Party
prevailing in any such arbitration shall recover from the adverse party its actual damages and
reasonable costs and expenses, including, without limitation, reasonable attorneys’ fees incurred
in connection with such dispute and arbitration.



     (e) Election by Participant. All elections, designations, requests, notices,
instructions and other communications from a Participant, Beneficiary or other person to the
Administrator required or permitted under the Plan shall be in such form as is prescribed from time
to time by the Administrator, shall be mailed by first-class mail or delivered to such location as
shall be specified by the Administrator and shall be deemed to have been given and delivered only
upon actual receipt by the Administrator at such location.



     (f) Notices by Administrator. All notices, statements, reports and other
communications from the Administrator to any Employee, Eligible Person, Participant, Beneficiary or
other person required or permitted under the Plan shall be deemed to have been



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duly given when
delivered to, or when mailed first-class mail, postage prepaid and addressed to,
such Employee, Eligible Person, Participant, Beneficiary or other person at his address last
appearing on the records of the Employer.



     (g) No Employment Rights. Neither the Plan nor any action taken under the Plan shall
be construed as giving to any person the right to be retained in the employ of the Employer or as
affecting the right of the Employer to dismiss any person (other than a Director) at any time, with
or without cause.



     (h) Withholding of Taxes. The Employer shall deduct from the Participant’s
nondeferred Compensation (or shall make any other arrangement with Participant which the Employer
deems appropriate) any amount required to be paid by the Participant as a federal or state tax with
respect to any Election hereunder, including, without limitation, Federal employment taxes due at
the date of any deferral or Company Contributions. In addition, the Employer shall be entitled to
deduct from the Participant’s Vested Benefit, prior to distribution, any amount required to be
withheld for federal or state tax purposes with respect to any amount credited hereunder and/or any
amount distributed from the Plan.



     (i) Waivers. Any waiver of any right granted pursuant to this Plan shall not be valid
unless the same is in writing and signed by the party waiving such right. Any such waiver shall
not be deemed to be a waiver of any other rights.



     (j) Binding Effect. This Plan and the rights and obligations under this Plan shall be
binding upon all parties and inure to the benefit of only the Participants, Beneficiaries and their
respective legal representatives.



     (k) Payment of Expenses. All expenses incident to the administration, termination, or
protection of the Plan, including, but not limited to, legal and accounting fees, shall be paid by
the Company.



     (l) Records. Records of the Company as to any matters relating to this Plan will be
conclusive on all persons.



     (m) Interpretations and Adjustments. To the extent permitted by law, each
interpretation of the Plan and each decision on any matter relating to the Plan made by the Board
of Directors, the Company, or the Administrator, within their scope of their authority hereunder,
shall be made in their sole discretion and shall be binding on all persons. A misstatement or
other mistake of fact shall be corrected when it becomes known and the person responsible shall
make such adjustment on account thereof as he considers equitable and practicable. Notwithstanding
any provision of the Plan to the contrary, if the Administrator, in its sole discretion,
determines, in writing filed in the appropriate records of the Administrator, that compliance with
any provision(s) of this Plan would result in a charge to the earnings of the Employer or any
related company in excess of the charge to earnings which would be incurred in the absence of such
compliance, then the Administrator shall have the right and authority, exercisable in its sole
discretion, to fail or refuse to comply with such provision(s).



     (n) No Rights Implied. All Contributions may be used by the Employer for any
corporate purpose, and the Employer shall not be obligated to segregate such amounts. Without



-20-









 







limitation, nothing contained in this Plan, nor any modification or amendment to the Plan, nor
the creation of any Account on the books of the Company, nor the issuance of any Shares under
the Plan, shall give any Employee any legal or equitable right against the Company or any officer,
director, or Employee of the Company, except as expressly provided by the Plan.



     (o) Information. The Company shall, upon request or as may be specifically required
hereunder, furnish or cause to be furnished, all of the information or documentation which is
necessary or required by the Board of Directors and/or Administrator to perform its duties and
functions under the Plan. The Company’s records as to the current information the Company
furnishes to the Board of Directors and/or Administrator shall be conclusive as to all persons.



     (p) No Liability for Good Faith Determinations. Neither the Company, the Board of
Directors, nor the Administrator (nor their respective delegatee) shall be liable for any act,
omission, or determination taken or made with respect to the Plan which is not judicially
determined to be due to willful misconduct, and members of the Board of Directors and the
Administrator (and their delegatee) shall be entitled to indemnification and reimbursement by the
Company in respect of any claim, loss, damage, or expense (including attorneys’ fees, the costs of
settling any suit, provided such settlement is approved by independent legal counsel selected by
the Company, and amounts paid in satisfaction of a judgment, except a judgment based on a finding
of willful misconduct) arising therefrom to the full extent permitted by law and under any
directors’ and officers’ liability or similar insurance coverage that may from time to time be in
effect.



     (q) Severability. In case any one or more of the provisions contained in this Plan
shall be invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions in this Plan shall not in any way be affected or
impaired.



     (r) Captions and Gender. The captions preceding the Sections and subsections of this
Plan have been inserted solely as a matter of convenience and in no way define or limit the scope
or intent of any provisions of this Plan. Where the context admits or requires, words used in the
masculine gender shall be construed to include the feminine and the neuter also, the plural shall
include the singular, and the singular shall include the plural.



     (s) Choice of Law. The Plan and all rights under this Plan shall be governed by and
construed in accordance with the laws of the State of Texas, except to the extent
preempted by ERISA.



     (t) Securities Laws. The Plan intends to comply with and be exempt under the
Securities Act. The Participants under the Plan are final purchasers and not underwriters or
conduits to other beneficial owners or subsequent purchasers.



     (u) Information Required. Each Participant shall file with the Administrator such
pertinent information concerning himself and his Beneficiary as the Administrator may specify, and
no Participant or Beneficiary or other person shall have any rights or be entitled to any Benefits
under the Plan unless such information has been filed by, or with respect to, him.



-21-









 





     (v) Application of Section 409A. This Plan shall govern only amounts deferred and
vested prior to January 1, 2005, and therefore it is intended that this Plan be exempt from the
requirements of Section 409A of the Code, and all terms shall be interpreted in a manner
consistent with such intent.


Adopted, as amended and restated, by the Compensation

Committee of the Board of Directors at its meeting on

October 26, 2006, to be effective as of January 1,

2005.





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