Exhibit (10)E


 


DAYTON HUDSON CORPORATION


 


EXECUTIVE LONG TERM INCENTIVE PLAN

OF 1981


 


(As amended and restated on January 10, 2007)


 


 


ARTICLE I

ESTABLISHMENT OF THE PLAN


 


1.1    The
name of this plan shall be “The Dayton Hudson Corporation Executive Long Term
Incentive Plan of 1981” (hereinafter called the “Plan”).


 


1.2    The
purpose of the Plan is to advance the interim performance and long-term growth
of the Company by offering long-term incentives, in addition to current
compensation and other benefits, to those key employees of the Company and its
Subsidiaries who the Plan Committee determines will contribute to such
performance and growth inuring to the benefit of the shareholders of the
Company. Such long-term incentives may take the form of Stock Options, or
Performance Shares, or Restricted Stock Awards or any combination.


 


ARTICLE II

DEFINITIONS


 


2.1    AWARD.      An
“Award” is used at times in the Plan to refer to the act of granting a Stock
Option, Performance Share or Restricted Stock Award under the Plan.


 


2.2    BOARD.      ”Board”
is the Board of Directors of Dayton Hudson Corporation.


 


2.3    CODE.      ”Code”
is the Internal Revenue Code of 1986, as amended, as now in force or as
hereafter amended.


 


2.4    COMPANY.        ”Company” is Dayton Hudson
Corporation, a Minnesota corporation, and any successor thereof.


 


2.5    COVERED
OFFICER.    ”Covered Officer” includes all Participants
whose compensation, in the year in which the Award is made, is subject to the
compensation expense deduction limitations set forth in Section 162(m) of
the Code.


 


2.6    DATE
OF GRANT.    ”Date of Grant” shall be the date designated
in the resolution by the Plan Committee as the date of such Stock Option(s) or
Performance Share(s) or Restricted Stock Award(s), but such date shall not be
earlier than the date of the resolution and action thereon by the Plan
Committee, or earlier than the effective date of the Plan, and in the absence
of a date of grant or a fixed method of computing such date being specifically
set forth in the Plan Committee’s resolution, then the Date of Grant shall be
the date of such Plan Committee’s resolution and action.


 

















 


2.7    FAIR
MARKET VALUE.    ”Fair Market Value” of a share of Company
common stock on any date is 100% of the mean between the high and low prices
for such stock as reported for such stock on the New York Stock Exchange
Composite Transactions Listing (“Composite Listing”) on such date, or in the
absence of such report 100% of the mean between the high and low prices of such
stock on the New York Stock Exchange on such date or, if no sale has been
recorded on the Composite Listing or made on such Exchange on such date, then
on the last preceding date on which any such sale shall have been made in the
order of primacy above indicated.


 


2.8    HOLDER.    A
“Holder” is a person who has been granted a Restricted Stock Award.


 


2.9    INCENTIVE
STOCK OPTIONS.    ”Incentive Stock Options” are Stock
Options that are intended to qualify under Section 422 of the Code.


 


2.10  NON-QUALIFIED
OPTIONS.    ”Non-Qualified Options” are Stock Options that
are not intended to qualify under Section 422 of the Code.


 


2.11  PARTICIPANT.    A
“Participant” is a person designated as such by the Plan Committee, pursuant to
Article III hereof, for participation in the Plan.


 


2.12  PERFORMANCE
GOALS.    ”Performance Goals” are defined in Section 4.1
hereof.


 


2.13  PERFORMANCE
PERIOD.    ”Performance Period”, with respect to a
Performance Share, is a period of four consecutive fiscal years of the Company,
beginning with the fiscal year in which such Performance Share is granted and
may be referred to herein and by the Plan Committee by use of the calendar year
in which a particular Performance Period commences.


 


2.14  PERFORMANCE
SHARE.    A “Performance Share” is a potential award
consisting of a right to one share of the Company’s $.3333 par value common
stock (subject to increase as provided in Section 4.2 hereof) or a lesser
number of shares and the cash payment set forth in Section 5.2 hereof. A
Performance Share shall be of no value to a Participant unless and until earned
in accordance with Article V hereof.


 


2.15  PLAN
COMMITTEE.    The “Plan Committee” is the Committee
referenced in Article IX hereof.


 


2.16  PLAN
YEAR.    The “Plan Year” shall be a fiscal year of the
Company falling within the term of this Plan.


 


2.17  RELEVANT
CHANGE ADJUSTMENTS.   In the event of any equity restructuring
(within the meaning of Financial Accounting Standards No. 123 (revised 2004))
other than: (1) any distribution of securities or other property by the Company
to shareholders in a spin-off or split-up that does not qualify as a tax-free
spin-off or split-up under Section 355 of the Code (or any successor provision
of the Code); or (2) any cash dividend (including extraordinary cash
dividends), appropriate adjustments in the number of shares available for grant
and in any outstanding Awards, including adjustments in the size of the Award
and in the exercise price per share of Stock Options, shall be made by the Plan
Committee to give effect to such equity restructuring to prevent dilution or
enlargement of the benefits or potential benefits intended to


 

















 


be made available under
the Plan. No such adjustment shall be required to reflect the events described
in clauses (1) and (2) above, or any other change in capitalization that does
not constitute an equity restructuring, however such adjustment may be made if
the Plan Committee affirmatively determines, in its discretion, that such an
adjustment is appropriate.


 


2.18  RESTRICTED
STOCK AWARD.    A “Restricted Stock Award” is an Award
granted under Article VII of this Plan.


 


2.19  STOCK
OPTION.    A “Stock Option” is a right accruing in a
Participant to purchase from the Company one share of the Company’s $.3333 par
value common stock at the Fair Market Value of such share of common stock on
the Date of Grant of the Stock Option, such exercise of option to be made any
time within ten years and one day (ten years with respect to Incentive Stock
Options) following the Date of Grant, and containing the terms and conditions
set forth or allowed under Article VI hereof. Stock Options may be either
Non-Qualified Options or Incentive Stock Options.


 


2.20  SUBSIDIARY
CORPORATION.    For purposes of this Plan, the term “Subsidiary”
or “Subsidiary Corporation” means any corporation (other than the Company) in
an unbroken chain of corporations beginning with the Company, in which each of
the corporations other than the last corporation in the unbroken chain owns
stock possessing fifty percent or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain as determined
at the point in time when reference is made to such “Subsidiary” or “Subsidiary
Corporation” in this Plan.


 


2.21  CHANGE
IN CONTROL.    A “Change in Control” shall be deemed to
have occurred if:


 


(a)  a majority of the directors of the Company
shall be persons other than persons 




 


(i)  for whose election proxies shall have been
solicited by the Board or


 


(ii)  who are then serving as directors appointed
by the Board to fill vacancies on the Board caused by death or resignation (but
not by removal) or to fill newly-created directorships,


 


(b)  30% or more of the outstanding Voting Stock
(as defined in Article IV of the Restated Articles of Incorporation, as
amended, of the Company) of the Company is acquired or beneficially owned (as
defined in Article IV of the Restated Articles of Incorporation, as
amended, of the Company) by any person (as defined in Article IV of the
Restated Articles of Incorporation, as amended, of the Company), or


 


(c)  the shareholders of the Company approve a
definitive agreement or plan to


 


(i)  merge or consolidate the Company with or into
another corporation (other than (1) a merger or consolidation with a
Subsidiary of the Company or (2) a merger in which the Company is the
surviving corporation and either (A) no outstanding Voting Stock of the


 

















 


Company (other than
fractional shares) held by shareholders immediately prior to the merger is
converted into cash (except cash upon the exercise by holders of Voting Stock
of the Company of statutory dissenters’ rights), securities, or other property
or (B) all holders of outstanding Voting Stock of the Company (other than
fractional shares) immediately prior to the merger (except those that exercise statutory
dissenters’ rights) have substantially the same proportionate ownership of the
Voting Stock of the Company or its parent corporation immediately after the
merger),


 


(ii)  exchange, pursuant to a statutory exchange of
shares of Voting Stock of the Company held by shareholders of the Company
immediately prior to the exchange, shares of one or more classes or series of
Voting Stock of the Company for shares of another corporation or other
securities, cash or other property,


 


(iii)  sell or otherwise dispose of all or
substantially all of the assets of the Company (in one transaction or a series
of transactions) or


 


(iv)  liquidate or dissolve the Company.


 


ARTICLE III

GRANTING OF STOCK OPTIONS, PERFORMANCE SHARES

AND RESTRICTED STOCK AWARDS TO PARTICIPANTS


 


3.1      ELIGIBLE
EMPLOYEES.    Stock Options, Restricted Stock Awards or
Performance Shares may be granted by the Plan Committee to any key employee of
the Company or a Subsidiary Corporation. A Stock Option(s) or Performance
Share(s) or Restricted Stock Award(s) may be granted to a director of the
Company provided that he/she is also at the time of grant a key employee of the
Company or a Subsidiary Corporation. No Stock Option(s) or Performance Share(s)
or Restricted Stock Award(s) shall be granted to a person who is at the time of
award a member of the Plan Committee. A person who has been engaged by the
Company for employment shall be eligible for grants under the Plan, provided
such person actually reports for and commences such employment within ninety days
after the Date of Grant.


 


3.2      DESIGNATION
OF PARTICIPANTS.    At any time and from time to time
during the Plan Year, the Plan Committee may designate the key employees of the
Company and its Subsidiaries eligible for Awards.


 


3.3      ALLOCATION
OF STOCK OPTION(S), PERFORMANCE SHARE(S) OR RESTRICTED STOCK
AWARD(S).    Contemporaneously with the designation of a
Participant pursuant to Section 3.2 hereof, the Plan Committee shall
determine the number of Stock Option(s) and/or Restricted Stock Award(s) and/or
Performance Share(s) to be granted to such Participant and the Date of Grant
for such related Stock Option or Performance Share or Restricted Stock Award,
taking into consideration such factors as it deems relevant, which may include
the following:


 


(a)  the total number of Stock Option(s) and/or
Restricted Stock Award(s) and/or Performance Share(s) available for allocation
to all Participants; and


 

















 


(b)  the work assignment or the position of the
Participant and its sensitivity and/or impact in relationship to the
profitability and growth of the Company and its Subsidiaries; and


 


(c)  the Participant’s current and potential
performance in reference to such factors.


 


Allocation of Awards may,
in the discretion of the Plan Committee, be in the form of Stock Option(s)
solely or Performance Share(s) solely, or Restricted Stock Award(s) solely, or
any combination in whatever relationship one to the other, if any, as the Plan
Committee in its discretion so determines. Allocation of Stock Options may, in
the discretion of the Plan Committee, be in the form of Incentive Stock
Option(s) solely or Non-Qualified Option(s) solely or a combination in whatever
relationship to the other, if any, as the Plan Committee in its discretion so
determines.


 


3.4      NOTIFICATION
TO PARTICIPANTS AND DELIVERY OF DOCUMENTS.    As soon as
practicable after such determinations have been made, each Participant, shall
be notified of (i) his/her designation as a Participant, (ii) the
Date of Grant, and (iii) the number of Stock Option(s), and/or Restricted
Stock Award(s) and/or the number of Performance Share(s) granted to the
Participant, and in the case of Performance Share(s), the Performance Period
and in the case of Restricted Stock Award(s), the Restriction Period. The
Participant shall thereafter be supplied with written evidence of any such
granted Performance Share(s) and/or Restricted Stock Award(s), and shall
receive a Stock Option exercisable for purchase of one share of the Company’s
$.3333 par value common stock for each Stock Option granted to the Participant
pursuant to this Plan or indicating the aggregate of such grant, which option
agreement(s) shall be in conformity with the provisions of Article VI
hereof.


 


ARTICLE IV

PERFORMANCE GOALS AND MAXIMUM AWARD


 


4.1      ESTABLISHMENT
OF GOALS.    Within a reasonable period of time after the
beginning of each Performance Period, Performance Goals relative to such
Performance Period shall be established by the Plan Committee in its absolute
discretion. Such Performance Goals may include, but, except as provided below,
are not limited to, criteria such as PTOC, EVA, amount or rate of growth in
consolidated profits of the Company expressed as a percent, earnings per share,
return on capital, return on investment, return on shareholders’ equity.
Performance Goals for Covered Officers must be based upon one or more of the
foregoing specifically described performance goals. Performance Goals may be
absolute in their terms or be measured against or in relationship to other
companies comparably, similarly or otherwise situated. The Plan Committee, in
its sole discretion, may modify the Performance Goals if it determines that
circumstances have changed and modification is required to reflect the original
intent of the Performance Goals. The Plan Committee may in its discretion
classify Participants into as many groups as it determines, and as to any
Participant(s) relate his/her Performance Goals partially, or entirely, to the
measured performance, either absolutely or relatively, of an identified Subsidiary,
operating company or test strategy or new venture of the Company.


 

















 


4.2      LEVELS
OF PERFORMANCE REQUIRED TO EARN PERFORMANCE SHARES.    At
or about the same time that Performance Goals are established for a specific
period, the Plan Committee shall in its absolute discretion establish the
percentage (not to exceed 150% thereof) of the Performance Share(s) granted for
such Performance Period which shall be earned by the Participant for various
levels of performance measured in relation to achievement of Performance Goals
for such Performance Period.


 


4.3      OTHER
RESTRICTIONS.    The Plan Committee may provide
restrictions on the delivery of common stock of the Company upon the earning of
Performance Shares, including the future forfeiture of all or part of the
common stock earned. The Plan Committee may provide that the shares of the
Company’s .3333 par value common stock issued on Performance Shares Earned be
held in escrow and/or legended.


 


4.4      NOTIFICATION
TO PARTICIPANTS.    Promptly after the Plan Committee has
established Performance Goals for a specific Performance Period or modified
such goals, each Participant who has received a grant of any Performance
Share(s) for that period shall be provided with written evidence of the
Performance Goals so established or modified.


 


4.5      During
any Plan Year, no Covered Officer may receive Awards that, in the aggregate,
could result in that Participant receiving, earning or acquiring more than
1,000,000 shares of the Company’s $.3333 par value common stock, subject to the
adjustments described in Section 2.17.


 


ARTICLE V

EARNING OF PERFORMANCE SHARES


 


5.1      MEASUREMENT
OF PERFORMANCE AGAINST PERFORMANCE GOALS.    The Plan
Committee shall as soon as practicable after the close of each Performance
Period, make a determination of:


 


(a)  the extent to which the Performance Goals for
such Performance Period have been achieved;


 


(b)  the percentage of the Performance Shares
granted for such Performance Period which are earned for such Performance
Period by Participants who have been from his/her date of hire in the
continuous employ of the Company or Subsidiary or a combination thereof, during
the subject Performance Period; and


 


(c)  the percentage of Performance Shares to be
paid in cash, if any. The percentage paid in cash shall be uniform for all
Participants in a particular Performance Period.


 


These determinations
shall be absolute and final as to the facts and conclusions therein made and be
binding on all parties. Promptly after the Plan Committee has made the foregoing
determination each Participant who has earned Performance Share(s) based
thereon shall be notified, in writing, of the number of Performance Shares so
earned. For all purposes of this Plan notice shall be deemed to have been given
the date action is taken by the Plan Committee making the determination. The
Participant may not sell, transfer, pledge, exchange, hypothecate or otherwise
dispose of Performance Shares or any part of a Performance Share Award during
the


 

















 


Performance Period,
except that Performance Share awards may be transferable by assignment by the
Participant to the extent provided in the applicable Performance Share
agreement.


 


5.2      TREATMENT
OF PERFORMANCE SHARES EARNED.    Upon the determination
that a percentage of the Performance Share(s) has been earned for a Performance
Period, a Participant to whom such earned Performance Share(s) has been granted
and who has been (or was) in the employ of the Company or a Subsidiary thereof
continuously from the date of his/her hire during the subject Performance
Period to which the grant relates, subject to the exceptions set forth at
Section 5.5 and Section 5.6 hereof, shall be entitled, subject to the
other conditions of this Plan, to receive the shares of the Company’s $.3333
par value common stock for each Performance Share earned (less the shares paid
in cash), plus a cash payment in the amount of the Fair Market Value of the
shares of common stock to be paid in cash as determined in
Section 5.1(c) hereof, calculated as of the close of business on the
date of the notice referred to in Section 5.1 hereof. The provisions of
Section 5.5 to the contrary notwithstanding, the Plan Committee may
provide that the issued shares of common stock be held in escrow and/or be
legended and that the common stock be subject to restrictions, including the
future forfeiture of all or a part of the shares. Performance Shares shall
under no circumstances become earned or have any value whatsoever for any
Participant who is not in the employ of the Company or its Subsidiaries
continuously during the entire Performance Period for which such Performance
Shares are granted, except as provided at Section 5.5 or Section 5.6
hereof.


 


5.3      STOCK-CASH
DISTRIBUTION.    Each distribution determined in accordance
with Section 5.2 above shall be made as soon as practicable after
Performance Shares have been determined to have been earned unless the
provisions of Section 5.4(a) hereof are applicable to a Participant.


 


5.4(a) DEFERRAL OF RECEIPT OF PERFORMANCE SHARE
EARNOUT.    A Participant who has received a grant of
Performance Shares may by compliance with the then applicable procedures under
the Plan irrevocably elect in writing to defer receipt of all or any part of
the stock-cash distribution associated with the earnout, if any, of the
Performance Shares (the combination thereof hereafter referred to as the “deferred
account”). The deferral shall be effective until the Participant terminates
his/her employment with the Company and its Subsidiaries except as otherwise
provided herein.


 


The
terms and conditions of such deferral, including but not limited to, the period
of time for, and form of, election; the manner and method of payout; the form
in which the deferred account shall be held; the interest equivalent or other
payment that shall accrue upon the deferred account pending its payout; and the
use and form of dividend equivalents in respect of stock units included within
any deferred account, shall be as determined from time to time by the Plan
Committee, which Plan Committee may change any and all of the terms and
conditions at any time applicable to deferrals thereafter made.


 


5.4(b)    AMENDMENT OF DEFERRAL
ARRANGEMENTS.    The Plan Committee may, at any time and
from time to time, but prospectively only except as hereinafter provided,
amend, modify, change, suspend or cancel any and all of the rights, procedures,
mechanics and timing parameters relating to the deferral of receipt of
Performance Share earnout under the Plan as set forth at
Section 5.4(a) hereof. In addition, the Plan Committee may, in its
sole discretion,


 

















 


accelerate the payout of
the deferred account, or any portion thereof, either in a lump sum or in a
series of payments, but under the following conditions only:


 


(a)  the Federal tax statutes, regulations or
interpretations are amended, modified, or otherwise changed or affected in such
a manner as to adversely alter or modify the tax effect of the “deferred
account” as it is comprehended under the tax law and interpretations in effect
for deferred accounts as of the effective date of this Plan, or


 


(b)  the deferred account holder suffers or incurs
an event that would qualify for a “withdrawal” of contributions that have not
been accumulated for two years without adverse consequences on the tax status
of a qualified profit-sharing or stock bonus plan under the Federal tax laws
applicable from time to time to such types of plans.


 


5.5  NON-DISQUALIFYING TERMINATION OF
EMPLOYMENT.    Except for Section 5.6 hereof, the only
exceptions to the requirement of continuous employment during a Performance
Period for Performance Share earnout eligibility are termination of a
Participant’s employment by reason of death (in which event the Performance
Shares may be transferable by will or the laws of descent and distribution only
to such Participant’s beneficiary designated to receive the Performance Shares
or to the Participant’s applicable legal representatives, heirs or legatees),
total and permanent disability, normal or late retirement or early retirement,
with the consent of the Plan Committee, or transfer of an executive in a
spin-off, with the consent of the Plan Committee, occurring during the
Performance Period applicable to the subject Performance share grant. In such
instance an earnout of the Performance Shares shall be made, as of the end of
the Performance Period, and 100% of the total Performance Shares that would
have been earned during the Performance Period shall be earned and paid out;
provided, however, in a spin-off situation the Plan Committee may set additional
conditions, such as, without limiting the generality of the foregoing,
continuous employment with the spin-off entity. If a Participant’s termination
of employment does not meet the criteria set forth above, but the Participant
had at least 15 years of continuous employment with the Corporation or a
Subsidiary or any combination thereof, provided that if the person is not an
Executive Officer (as defined under the Securities Exchange Act of 1934, as
amended, and the regulations promulgated thereunder) of the Corporation at time
of termination such 15 years need not be continuous, the Plan Committee may
allow earn-outs of up to 100% of the total Performance Shares for the
Performance Period(s) in which the termination of employment occurred, subject
to any conditions that the Plan Committee shall determine.


 


5.6      CHANGE
IN CONTROL.    In the event of a Change in Control, all
outstanding Performance Shares granted under the Plan shall be proratably
payable ten days after the Change in Control; provided that no Performance
Share shall be payable to a Participant within six months after the Date of
Grant. The amount of Performance Shares payable shall be determined by
multiplying 100% of each Performance Share grant by a fraction, the numerator
of which shall be the number of months that have elapsed in the applicable
Performance Period and the denominator of which shall be forty-eight.


 

















 


ARTICLE VI

STOCK OPTIONS


 


6.1      NON-QUALIFIED
OPTION.    Non-Qualified Options granted under the Plan are
not intended to be Incentive Stock Options under the provisions of
Section 422 of the Code. The Non-Qualified Options shall be evidenced by
Non-Qualified Option agreements in such form and not inconsistent with the Plan
as the Plan Committee shall in its sole discretion approve from time to time,
which agreements shall specify the number of shares to which they pertain and
the purchase price of such shares and shall, but without limitation, contain in
substance the following terms and conditions:


 


(a)  OPTION PERIOD.    Each
option granted shall expire and all rights to purchase shares thereunder shall
cease ten years and one day after the Date of Grant of the Stock Option or on
such date prior thereto as may be fixed by the Plan Committee, or on such date
prior thereto as is provided by this Plan in the event of termination of
employment or death or reorganization pursuant to
Section 11.8(b) hereof. No option shall permit the purchase of any
shares thereunder during the first year after the Date of Grant of such option,
except as provided in Section 6.3 hereof.


 


(b)  TRANSFERABILITY AND TERMINATION OF
OPTIONS.    During the lifetime of an individual to whom an
option is granted, the option may be exercised only by such individual and only
while such individual is an employee of the Company or a Subsidiary and only if
the Participant has been continuously so employed by any one or combination
thereof since the Date of Grant of the option; provided, however, that if the
employment of such Participant by the Company or a Subsidiary Corporation
terminates, the option may additionally be exercised as follows, or in any
other manner provided by the Plan Committee, but in no event later than 10
years and one day after the Date of Grant of the Stock Option, except as set
forth in (ii) below:


 


(i) if a Participant’s
termination of employment occurs by reason of normal or late retirement under
any retirement plan of the Company or its Subsidiaries, such Participant’s
Stock Options may be exercised within five years after the date of such
termination of employment. If a Participant’s termination of employment occurs
by reason of early retirement under any retirement plan of the Company or its
Subsidiaries, or, by reason of the transfer of an executive in a spin-off, or
by reason of total and permanent disability, as determined by the Plan
Committee, without retirement, then such Participant’s Stock Options shall be
exercisable for a period of up to five years after the date of such termination
of employment if the Plan Committee consents to such an extension. During the
extension period the right to exercise options, if any, accruing in
installments, shall continue; provided, however, in an early retirement or a
spin-off situation the Plan Committee may set additional conditions, such as,
without limiting the generality of the foregoing, an agreement to not provide
services to a competitor of the Company and its Subsidiaries and/or continuous
employment with the spin-off entity.


(ii)  if a Participant’s termination of employment
occurs by reason of death, then within five years after the date of death or
the life of the option, whichever is less, but in no


 

















 


event less than one year
after the date of death, during which time installments shall continue to
accrue.


 


(iii)  if a Participant’s termination of employment
occurs for any reason other than as specified in Section 6.1(b)(i) or
(ii) hereof, the Participant has been continuously employed by the Company or a
Subsidiary or any combination for more than 15 years, provided that if the person
is not an Executive Officer (as defined under the Securities Exchange Act of
1934, as amended, and the regulations promulgated thereunder) of the
Corporation at the time of termination such 15 years need not be continuous,
and if the Plan Committee so approves, then within a period of up to five years
after the date of termination of employment. During the period the right to
exercise options, if any, accruing in installments shall continue; provided,
however, the Plan Committee may set additional conditions.


 


(iv) if a Participant’s
termination of employment occurs for any reason other than as specified in
Section 6.1(b)(i) or (ii) hereof, the Plan Committee has not approved
an extension pursuant to Section 6.1(b)(iii) and Participant’s
termination of employment is not occasioned by the commission of a dishonest or
other illegal act, then, but only with respect to installments that have as of
the date of termination already accrued, within ninety days after the date of
such termination of employment except in the case of Participants who would at
the time be subject to the provisions of Section 16(b) of the
Securities Exchange Act of 1934, in which instance the period of exercise shall
be two hundred ten days after termination. Those Participants terminated
because of the commission of a dishonest or other illegal act shall have no
additional period after termination of employment in which to exercise their
options. Absence on a leave of absence approved by the Plan Committee shall not
be deemed a termination or interruption of continuous employment for the
purposes of the Plan.


 


(v) Rights accruing to a
Participant under the aforesaid Subsections (b)(i), (b)(iii) and
(b)(iv) may, upon the death of a Participant subsequent to his/her
termination of employment, be exercised or perfected by his/her duly designated
beneficiary or otherwise by his/her applicable legal representatives, heirs or
legatees to the extent vested in and unexercised or perfected by the
Participant at the date of his/her death.


 


No option shall be assignable or transferable by the
individual to whom it is granted, except that it may be transferable (X) by
assignment by the Participant to the extent provided in the applicable option
agreement, or (Y) by will or the laws of descent and distribution in accordance
with the provisions of this Plan. An option transferred after the death of the
Participant to whom it is granted may only be exercised by such individual’s
beneficiary designated to exercise the option or otherwise by his/her applicable
legal representatives, heirs or legatees, and only within the specific time
period set forth above and only to the extent vested in and unexercised by the
Participant at the date of his/her death, except as provided in Section
6.1(b)(ii).


 

















 


In no event, whether by the Participant directly or by
his/her proper assignee or beneficiary or other representative, shall any
option be exercisable at any time after its expiration date as stated in the
option agreement, except as provided in Section 6.1(b)(ii). When an option is
no longer exercisable it shall be deemed for all purposes and without further
act to have lapsed and terminated. The Plan Committee may in its sole
discretion, but shall not be required to, determine, solely for the purposes of
the Plan, that a Participant is permanently and totally disabled, and the acts
and decisions of the Plan Committee made in good faith in relation to any such
determination shall be conclusive upon all persons and interests affected
thereby.


 


(c)  EXERCISE OF OPTIONS.    An
individual entitled to exercise an option may, subject to its terms and
conditions and the terms and conditions of the Plan, exercise it in whole at
any time, or in part from time to time, by delivery to the Company at its principal
office of written notice of exercise, specifying the number of whole shares
with respect to which the option is being exercised. Before shares may be
issued payment must be made in full, in legal United States tender, in the
amount of the purchase price of the shares to be purchased at the time and any
amounts for withholding as provided in Section 11.9 hereof; provided,
however, in lieu of paying for the exercise price in cash as described above,
the individual may pay (subject to such conditions and procedures as the Plan
Committee may establish) all or part of such exercise price by delivering owned
and unencumbered shares of the Company common stock having a Fair Market Value
on the date of exercise of the option equal to or less than the exercise price
of the options exercised, with cash, as set forth above, for the remainder, if
any, of the purchase price. Subject to rules established by the Plan
Committee, the withholdings required by Section 11.9 hereof may be
satisfied by the Company withholding shares of Company common stock issued on
exercise that have a Fair Market Value on the date of exercise of the option
equal to or less than the withholding required by Section 11.9 hereof.


 


6.2      INCENTIVE
STOCK OPTION.    Incentive Stock Options granted under the
Plan are intended to be incentive stock options under Section 422 of the
Code and the Plan shall be administered, except with respect to the right to
exercise options after termination of employment, to qualify Incentive Stock
Options issued hereunder as incentive stock options under Section 422 of
the Code. An Incentive Stock Option shall not be granted to an employee who
owns, or is deemed under Section 424(d) of the Code to own, stock of
the Company (or of any parent or Subsidiary of the Company) possessing more than
10% of the total combined voting power of all classes of stock therein. The
aggregate Fair Market Value (determined as of the time the option is granted)
of the stock with respect to which Incentive Stock Options are exercisable for
the first time by any Participant during any calendar year (under all incentive
stock option plans of the Company or any parent or Subsidiary of the Company)
shall not exceed $100,000. The Incentive Stock Options shall be evidenced by
Incentive Stock Option Agreements in such form and not inconsistent with the
Plan as the Plan Committee shall in its sole discretion approve from time to
time, which agreements shall specify the number of shares to which they pertain
and the purchase price of such shares.


 

















 


The terms and conditions set forth in Subsections
(a) through (c) of Section 6.1 hereof shall apply to an
Incentive Stock Option; provided that the term of the Incentive Stock Option
shall not exceed ten years; and provided, further, that in the event Section 6.1(b)(i) hereof
is applicable, all installments shall become immediately exercisable.


 


6.3      CHANGE
IN CONTROL.    In the event of a Change in Control, all
outstanding options granted under the Plan shall accelerate and will be
exercisable in full for a period of two hundred ten (210) days after the Change
in Control; provided that no option shall be exercisable by a Participant
(i) within six months after the Date of Grant of the option or
(ii) after the termination date of the option.


 


ARTICLE VII

RESTRICTED STOCK


 


7.1      RESTRICTION
PERIOD TO BE ESTABLISHED BY THE PLAN COMMITTEE.    At the
time a Restricted Stock Award is made, the Plan Committee shall establish a
period of time (the “Restriction Period”) applicable to such Award, which shall
be not less than three years. Each Restricted Stock Award may have a different
Restriction Period, at the discretion of the Plan Committee. Except as
permitted or pursuant to Sections 7.4, 7.5 or 11.8 hereof, the Restriction
Period applicable to a particular Restricted Stock Award shall not be changed.


 


7.2      OTHER
TERMS AND CONDITIONS.    Company common stock awarded
pursuant to a Restricted Stock Award shall be represented by a stock
certificate registered in the name of the Holder of such Restricted Stock
Award. The Holder shall have the right to enjoy all shareholder rights during
the Restriction Period with the exception that:


 


(i)  The Holder shall not be entitled to delivery
of the stock certificate until the Restriction Period shall have expired.


 


(ii)  The Company may either issue shares subject
to such restrictive legends and/or stop-transfer instructions as it deems
appropriate or provide for retention of custody of the Company common stock
during the Restriction Period.


 


(iii)  The Holder may not sell, transfer, pledge,
exchange, hypothecate or otherwise dispose of the Company common stock during
the Restriction Period, except that it may be transferable by assignment by the
Holder to the extent provided in the applicable Restricted Stock Award
agreement.


 


(iv)  A breach of the terms and conditions
established by the Plan Committee pursuant to the Restricted Stock Award shall
cause a forfeiture of the Restricted Stock Award, and any dividends withheld
thereon.


 


(v)  Dividends payable in cash or in shares of
stock or otherwise may be either currently paid or withheld by the Company for
the Holder’s account. At the discretion of the Plan Committee, interest may be
paid on the amount of cash dividends withheld, including


 

















 


cash dividends on stock
dividends, at a rate and subject to such terms as determined by the Plan
Committee.


 


Provided, however, and
the provisions of Section 7.4 to the contrary notwithstanding, in lieu of
the foregoing, the Plan Committee may provide that no shares of common stock be
issued until the Restriction Period is over and further provide that the shares
of common stock issued after the Restriction Period has been completed, be
issued in escrow and/or be legended and that the common stock be subject to
restrictions including the forfeiture of all or a part of the shares.


 


7.3      PAYMENT
FOR RESTRICTED STOCK.    A Holder shall not be required to
make any payment for Company common stock received pursuant to a Restricted
Stock Award, unless the Plan Committee requires payment for such stock in the
Restricted Stock Award.


 


7.4      FORFEITURE
PROVISIONS.    Subject to Section 7.5, in the event a
Holder terminates employment during a Restriction Period, a Restricted Stock
Award will be forfeited; provided, however, when the Plan Committee issues the
Restricted Stock Award, it may provide in the Restricted Stock Award agreement
for proration or full payout in the event of a termination of employment
because of normal or late retirement, early retirement or spin-off with the
consent of the Plan Committee, or death or total and permanent disability, as
determined by the Plan Committee, or termination of employment after 15 years
of continuous employment with the Corporation or a Subsidiary or any
combination thereof, provided that if the person is not an Executive Officer (as
defined under the Securities Exchange Act of 1934, as amended, and the
regulations promulgated thereunder) of the Corporation at the time of
termination such 15 years need not be continuous, subject to any other
conditions the Plan Committee may determine.


 


7.5      CHANGE
IN CONTROL.    In the event of a Change in Control, all
outstanding Restricted Stock Awards granted under the Plan will be proratably
payable ten days after the Change in Control; provided that no Restricted Stock
Award shall be payable to a Participant within six months after the Date of
Grant. The amount of Company common stock payable shall be determined by
multiplying each Restricted Stock Award granted by a fraction, the numerator of
which shall be the number of months that have elapsed in the applicable
Restriction Period and the denominator of which shall be the number of months
in the Restriction Period.


 




ARTICLE VIII

SHARES OF STOCK SUBJECT TO THE PLAN


 


8.1      The
total number of shares that may be available for issuance under all Performance
Shares, Stock Options and Restricted Stock Awards granted pursuant to the Plan
shall not exceed in the aggregate 18,600,000 shares of the Company’s $.3333 par
value common stock. Shares covered by granted Performance Shares which are not
earned pursuant to any of the provisions of Article V hereof, or Stock
Options or Performance Shares or Restricted Stock Awards which are forfeited
for any reason or are not distributed or are covered by options that lapse or
are cancelled before exercise, shall (unless the Plan shall have been
terminated) again be available in the same relative amounts for other
Performance Share, Restricted Stock Award and Stock Option grants under the
Plan (except for shares for which cash equivalent payments are received by
Participants pursuant to the Plan), except that 660,825 shares for Stock
Options, Performance Shares or


 

















Restricted Stock Awards
that were outstanding on April 10, 1991 that are not earned or are
forfeited for any reason or are not distributed or lapse or are cancelled
before exercise shall be available for future grants and any additional shares
for Stock Options, Performance Shares or Restricted Stock Awards that were
outstanding on April 10, 1991 that are not earned or are forfeited for any
reason or are not distributed or lapse or are cancelled before exercise shall
not be available for future Performance Shares, Restricted Stock Awards or
Stock Option Grants. Such shares may be authorized and unissued shares, or may
be treasury shares held by the Company or may be shares purchased or held by
the Company or a Subsidiary for purposes of the Plan, or any combination
thereof.


 




ARTICLE IX

ADMINISTRATION OF THE PLAN


 


9.1      The
Plan will be administered by a committee of the Board appointed from time to
time by the Board. Each member of the committee shall be a “non-employee
director” as that term is defined under Rule 16b-3, promulgated under the
Securities Exchange Act of 1934, as amended, or any successor statute or
regulation comprehending the same subject matter.


 


9.2      The
Plan Committee shall have and exercise all of the powers and responsibilities
granted expressly or by implication to it by the provisions of the Plan.
Subject to and as limited by such provisions, the Plan Committee may from time
to time enact, amend and rescind such rules, regulations and procedures with
respect to the administration of the Plan as it deems appropriate or
convenient.


 


9.3      All
questions arising under the Plan, any Incentive Stock Option, Non-Qualified
Stock Option, Performance Share or Restricted Stock Award agreement, or any
rule, regulation or procedure adopted by the Plan Committee shall be determined
by the Plan Committee, and its determination thereof shall be conclusive and
binding upon all parties.


 


9.4      Any
action required or permitted to be taken by the Plan Committee under the Plan
shall require the affirmative vote of a majority of a quorum of the members of
the Plan Committee. A majority of all members of the Plan Committee shall
constitute a “quorum” for Plan Committee business. The Plan Committee may act
by written determination instead of by affirmative vote at a meeting, provided
that any written determination shall be signed by all members of the Plan
Committee, and any such written determination shall be as fully effective as a
majority vote of a quorum at a meeting.


 




ARTICLE X

REDUCTION IN AWARDS


 


10.1    Anything
in this Plan to the contrary notwithstanding, the provisions of this
Article X shall apply to a Participant if Ernst & Young
determines that each of (a) and (b) below are applicable.


 


(a) Payments or
distributions hereunder, determined without application of this Article X,
either alone or together with other payments in the nature of compensation to
the


 

















 


Participant which are
contingent on a change in the ownership or effective control of the Company, or
in the ownership of a substantial portion of the assets of the Company, or
otherwise (but after any elimination or reduction of such payments under the
terms of the Company’s Income Continuance Policy Statement or SMG Income
Continuance Policy Statement), would result in any portion of the payments
hereunder being subject to an excise tax on excess parachute payments imposed
under Section 4999 of the Code.


 


(b) The excise tax
imposed on the Participant under Section 4999 of the Code on excess
parachute payments, from whatever source, would result in a lesser net
aggregate present value of payments and distributions to the Participant (after
subtraction of the excise tax) than if payments and distributions to the
Participant were reduced to the maximum amount that could be made without
incurring the excise tax.


 


10.2    Under
this Article X the payments and distributions under this Plan shall be
reduced (but not below zero) so that the present value of such payments and
distributions shall equal the Reduced Amount. The “Reduced Amount” (which may
be zero) shall be an amount expressed in present value which maximizes the
aggregate present value of payments and distributions under this Plan which can
be made without causing any such payment to be subject to the excise tax under
Section 4999 of the Code. The determinations and reductions under this
paragraph shall be made after eliminations or reductions, if any, have been
made under the Company’s Income Continuance Policy Statement or SMG Income
Continuance Policy Statement.


 


10.3    If
Ernst & Young determines that this Article X is applicable to a
Participant, it shall so advise the Plan Committee. The Plan Committee shall
then promptly give the Participant notice to that effect together with a copy
of the detailed calculation supporting such determination which shall include a
statement of the Reduced Amount. The Participant may then elect, in his/her
sole discretion, which and how much of the Stock Options, Restricted Stock
Awards and/or Performance Shares otherwise awarded under this Plan shall be
eliminated or reduced (as long as after such election the aggregate present
value of the remaining Stock Options, Restricted Stock Awards and/or
Performance Shares under this Plan equals the Reduced Amount), and shall advise
the Plan Committee in writing of his/her election within ten days of his/her
receipt of notice. If no such election is made by the Participant within such
ten-day period, the Plan Committee may elect which and how much of the Stock
Options, Restricted Stock Awards, and/or Performance Shares shall be eliminated
or reduced (as long as after such election their aggregate present value equals
the Reduced Amount) and shall notify the Participant promptly of such election.
For purposes of this Article X, present value shall be determined in
accordance with Section 280G of the Code. All the foregoing determinations
made by Ernst & Young under this Article X shall be made as
promptly as practicable after it is determined that parachute payments will be
made to the Participant if an elimination or reduction is not made. As promptly
as practicable following the election hereunder, the Company shall provide to
or for the benefit of the Participant such amounts and shares as are then due
to the Participant under this Plan and shall promptly provide to or for the
benefit of the Participant in the future such amounts and shares as become due
to the Participant under this Plan.


 


10.4    As a
result of the uncertainty in the application of Section 280G of the Code at the
time of the initial determination by Ernst & Young hereunder, it is
possible that payments or


 

















 


distributions under this
Plan will have been made which should not have been made (“Overpayment”) or
that additional payments or distributions which will have not been made could
have been made (“Underpayment”), in each case, consistent with the calculation
of the Reduced Amount hereunder. In the event that Ernst & Young,
based upon the assertion of a deficiency by the Internal Revenue Service
against the Company or the Participant which Ernst & Young believes
has a high probability of success, determines that an Overpayment has been
made, any such Overpayment shall be treated for all purposes as a loan to the
Participant which the Participant shall repay together with interest at the
applicable Federal rate provided for in Section 7872(f)(2) of the
Code; provided, however, that no amount shall be payable by the Participant if
and to the extent such payment would not reduce the amount which is subject to
the excise tax under Section 4999 of the Code. In the event that
Ernst & Young, based upon controlling precedent, determines that an
Underpayment has occurred, any such Underpayment shall be promptly paid to or
for the benefit of the Participant together with interest at the applicable
Federal rate provided for in Section 7872(f)(2)(A) of the Code.


 


10.5    In
making its determination under this Article X, the value of any non-cash
benefit shall be determined by Ernst & Young in accordance with the
principles of Section 280G(d)(3) of the Code.


 


10.6    All
determinations made by Ernst & Young under this Article X shall
be binding upon the Company, the Plan Committee and the Participant.


 




ARTICLE XI

GENERAL PROVISIONS


 


11.1    AMENDMENT
OR TERMINATION.    The Board may at any time amend,
suspend, discontinue or terminate the Plan (including the making of any
necessary enabling, conforming and procedural amendments to the Plan to
authorize and implement the granting of qualified Stock Options or other income
tax preferred stock options which may be authorized by enactment of the United
States Congress and/or the Internal Revenue Service subsequent to the effective
date of this Plan); provided, however, that no amendment by the Board shall,
without further approval of the shareholders of the Company:


 


(a) except as provided at
Section 2.17 hereof, increase the total number of shares of Company common
stock which may be made subject to the Plan; or


 


(b) except as provided at
Section 2.17 hereof, change the purchase price of Company common stock
under the Plan; or


 


(c) materially modify the
class of employees that are eligible to receive Stock Options and/or
Performance Shares and/or Restricted Stock Awards pursuant to the Plan.


 


No action taken pursuant
to this Section 11.1 of the Plan shall, without the consent of a
Participant, adversely affect any Performance Share(s) or Stock Option(s) or
Restricted Stock Award(s) which have been previously granted to a Participant.


 

















 


11.2    NON-ALIENATION
OF RIGHTS AND BENEFITS.    Except as expressly provided
herein, no right or benefit under the Plan shall be subject to anticipation,
alienation, sale, assignment, pledge, encumbrance or charge and any attempt to
anticipate, alienate, sell, assign, pledge, encumber or charge the same shall
be void. No right or benefit hereunder shall in any manner be liable for or
subject to the debts, contracts, liabilities or torts of the person entitled to
such right or benefit. If any Participant or beneficiary hereunder should
become bankrupt or attempt to anticipate, alienate, sell, assign, pledge,
encumber or charge any right or benefit hereunder, then such right or benefit
shall, in the sole discretion of the Plan Committee, cease and in such event
the Company may hold or apply the same or any or no part thereof for the
benefit of the Participant or beneficiary, his/her spouse, children or other
dependents or any of them in any such manner and in such proportion as the Plan
Committee in its sole discretion may deem proper.


 


11.3    NO
RIGHTS AS SHAREHOLDER.    The granting of Performance
Share(s) and/or Stock Option(s) and/or Restricted Stock Award(s) under the Plan
shall not entitle a Participant or any other person succeeding to his/her
rights, to any dividend, voting or other right as a shareholder of the Company
unless and until the issuance of a stock certificate to the Participant or such
other person pursuant to the provisions of the Plan and then only subsequent to
the date of issuance thereof.


 


11.4    LIMITATION
OF LIABILITY OR OBLIGATION OF THE COMPANY.    As
illustrative only of the limitations of liability or obligation of the Company
and not intended to be exhaustive thereof, nothing in the Plan shall be
construed:


 


(a) to give any employee
of the Company any right to be granted any Stock Option and/or Performance
Share and/or Restricted Stock Award other than at the sole discretion of the
Plan Committee;


 


(b) to give any
Participant any rights whatsoever with respect to shares of the Company’s
$.3333 par value common stock except as specifically provided in the Plan;


 


(c) to limit in any way
the right of the Company or any Subsidiary to terminate, change or modify, with
or without cause, the employment of any Participant at any time; or


 


(d) to be evidence of any
agreement or understanding, express or implied, that the Company or any
Subsidiary will employ any Participant in any particular position at any
particular rate of compensation or for any particular period of time.


 


11.5    GOVERNMENT
REGULATIONS.    Notwithstanding any other provisions of the
Plan seemingly to the contrary, the obligation of the Company with respect to
Performance Shares, Stock Options or Restricted Stock Awards granted under the
Plan shall at all times be subject to any and all applicable laws, rules, and
regulations and such approvals by any government agencies as may be required or
deemed by the Board or Plan Committee as reasonably necessary or appropriate
for the protection of the Company.


 


In connection with any sale, issuance or transfer
hereunder, the Participant acquiring the shares shall, if requested by the
Company give assurances satisfactory to counsel of the Company


 

















 


that the shares are being
acquired for investment and not with a view to resale or distribution thereof
and assurances in respect of such other matters as the Company may deem
desirable to assure compliance with all applicable legal requirements.


 


11.6    NON-EXCLUSIVITY
OF THE PLAN.    Neither the adoption of the Plan by the
Board nor the submission of the Plan to shareholders of the Company for
approval shall be construed as creating any limitations on the power or
authority of the Board to adopt such other or additional incentive or other
compensation arrangements of whatever nature as the Board may deem necessary or
desirable or preclude or limit the continuation of any other plan, practice or
arrangement for the payment of compensation or fringe benefits to employees
generally, or to any class or group of employees, which the Company or any
Subsidiary now has lawfully put into effect, including, without limitation, any
retirement, pension, savings, profit sharing or stock purchase plan, insurance,
death and disability benefits, and executive short term incentive plans.


 


11.7    EFFECTIVE
DATE.    Subject to the approval of this restated Plan by
the holders of a majority of the voting power of the shares present and
entitled to vote at the Company’s Annual Meeting of Shareholders to be held
May 21, 1997 and any necessary approval being obtained from any
department, board or agency of the United States or states having jurisdiction,
the Plan shall be effective as of May 21, 1997.


 


11.8    REORGANIZATION.    In
case the Company is merged or consolidated with another corporation, or in case
the property or stock of the Company is acquired by another corporation, or in
case of a separation, reorganization or liquidation of the Company, the Plan
Committee or a comparable committee of any corporation assuming the obligations
of the Company hereunder, shall either:


 


(a) make appropriate
provision for the protection of any outstanding Performance Shares, Stock
Options and Restricted Stock Awards granted thereunder by the substitution on
an equitable basis of appropriate stock of the Company, or of the merged,
consolidated or otherwise reorganized corporation which will be issuable in
respect to the shares of the Company’s $.3333 par value common stock. Stock to
be issued pursuant to such Performance Shares shall be limited so that the
excess of the aggregate fair market value of the shares subject to the
Performance Shares immediately after such substitution over the purchase price
thereof is not more than the excess of the aggregate fair market value of the
shares subject to such Performance Shares immediately before such substitution
over the purchase price thereof; or


 


(b) upon written notice
to the Participant, provide that all Performance Shares granted to the
Participant are deemed earned, that the Restriction Period of all Restricted
Stock Awards has been eliminated and that all outstanding Stock Options shall
accelerate and become exercisable in full but that all outstanding Stock
Options, whether or not exercisable prior to such acceleration, must be
exercised within not less than sixty days of the date of such notice or they will
be terminated. In any such case the Plan Committee may, in its discretion,
extend the sixty-day exercise period.


 


11.9    WITHHOLDING
TAXES, ETC.    All distributions under the Plan shall be
subject to any required withholding taxes and other withholdings and, in case
of distributions in Company


 

















 


common stock, the
Participant or other recipient may, as a condition precedent to the delivery of
the common stock, be required to pay to his/her participating employer the
excess, if any, of the amount of required withholding over the withholdings, if
any, from any distributions in cash under the Plan. No distribution under the
Plan shall be made in fractional shares of the Company’s common stock, but the
proportional market value thereof shall be paid in cash.


 


11.10  GENERAL RESTRICTION.    Each
Performance Share, Stock Option and Restricted Stock Award shall be subject to
the requirement that, if at any time the Board shall determine, in its
discretion, that the listing, registration or qualification of the shares
subject to such option and/or right upon any securities exchange or under any
state or Federal Law, or the consent or approval of any government regulatory
body, is necessary or desirable as a condition of, or in connection with the
granting of such Performance Share or Stock Option or Restricted Stock Award or
the issue or purchase of shares respectively thereunder, such Performance Share
or Stock Option or Restricted Stock Award may not be exercised in whole or in
part unless such listing, registration, qualification, consent or approval
shall have been effected or obtained free of any conditions not acceptable to
the Board.


 


11.11  USE OF PROCEEDS.    The proceeds
derived from the sale of the stock pursuant to Stock Options or Restricted
Stock Awards granted under the Plan shall constitute general funds of the
Company.


 


11.12  HEADINGS.    The headings of the
Articles and their subparts in this Plan are for convenience of reading only
and are not meant to be of substantive significance and shall not add to or
detract from the meaning of such Article or subpart to which it refers.