exv10w1











 




    Exhibit 10.1




 




    THE
    MEN’S WEARHOUSE, INC.



 




    2004
    LONG-TERM INCENTIVE PLAN



 




    (As
    Amended and Restated

    Effective April 1, 2008)













 







    TABLE OF
    CONTENTS



	 	 	 	 	 
	
 
	
 
	
    Section

	 

	

    ARTICLE I — ESTABLISHMENT, PURPOSE AND
    DURATION


	
 
	 
	
 
	 

	

    Establishment


	
 
	 
	
    1.1
	 

	

    Purpose of the Plan


	
 
	 
	
    1.2
	 

	

    Duration of Authority to Make Grants Under the Plan


	
 
	 
	
    1.3
	 

	

    ARTICLE II — DEFINITIONS


	
 
	 
	
 
	 

	

    Affiliate


	
 
	 
	
    2.1
	 

	

    Award


	
 
	 
	
    2.2
	 

	

    Award Agreement


	
 
	 
	
    2.3
	 

	

    Board


	
 
	 
	
    2.4
	 

	

    Cash-Based Award


	
 
	 
	
    2.5
	 

	

    Code


	
 
	 
	
    2.6
	 

	

    Committee


	
 
	 
	
    2.7
	 

	

    Company


	
 
	 
	
    2.8
	 

	

    Corporate Change


	
 
	 
	
    2.9
	 

	

    Covered Employee


	
 
	 
	
    2.10
	 

	

    Deferred Stock Unit


	
 
	 
	
    2.11
	 

	

    Deferred Stock Unit Award


	
 
	 
	
    2.12
	 

	

    Director


	
 
	 
	
    2.13
	 

	

    Disability


	
 
	 
	
    2.14
	 

	

    Dividend Equivalent


	
 
	 
	
    2.15
	 

	

    Effective Date


	
 
	 
	
    2.16
	 

	

    Employee


	
 
	 
	
    2.17
	 

	

    Exchange Act


	
 
	 
	
    2.18
	 

	

    Fair Market Value


	
 
	 
	
    2.19
	 

	

    Fiscal Year


	
 
	 
	
    2.20
	 

	

    Freestanding SAR


	
 
	 
	
    2.21
	 

	

    Holder


	
 
	 
	
    2.22
	 

	

    Incentive Stock Option or ISO


	
 
	 
	
    2.23
	 

	

    Mature Shares


	
 
	 
	
    2.24
	 

	

    Minimum Statutory Tax Withholding Obligation


	
 
	 
	
    2.25
	 

	

    Nonqualified Stock Option or NQSO


	
 
	 
	
    2.26
	 

	

    Option


	
 
	 
	
    2.27
	 

	

    Optionee


	
 
	 
	
    2.28
	 

	

    Option Price


	
 
	 
	
    2.29
	 

	

    Option Agreement


	
 
	 
	
    2.30
	 

	

    Other Stock-Based Award


	
 
	 
	
    2.31
	 

	

    Parent Corporation


	
 
	 
	
    2.32
	 

	

    Performance-Based Award


	
 
	 
	
    2.33
	 

	

    Performance-Based Compensation


	
 
	 
	
    2.34
	 

	

    Performance Goals


	
 
	 
	
    2.35
	 

	

    Performance Period


	
 
	 
	
    2.36
	 

	

    Performance Stock Award


	
 
	 
	
    2.37
	 

	

    Performance Unit Award


	
 
	 
	
    2.38
	 

	

    Period of Restriction


	
 
	 
	
    2.39
	 

	

    Plan


	
 
	 
	
    2.40
	 

	

    Restricted Stock


	
 
	 
	
    2.41
	 

	

    Restricted Stock Award


	
 
	 
	
    2.42
	 





    

    i








 





	 	 	 	 	 
	
 
	
 
	
    Section

	 

	

    Retirement


	
 
	 
	
    2.43
	 

	

    Section 409A


	
 
	 
	
    2.44
	 

	

    Stock Appreciation Right or SAR


	
 
	 
	
    2.45
	 

	

    Stock


	
 
	 
	
    2.46
	 

	

    Subsidiary Corporation


	
 
	 
	
    2.47
	 

	

    Substantial Risk of Forfeiture


	
 
	 
	
    2.48
	 

	

    Tandem SAR


	
 
	 
	
    2.49
	 

	

    Ten Percent Stockholder


	
 
	 
	
    2.50
	 

	

    Termination of Employment


	
 
	 
	
    2.51
	 

	

    Termination of Service


	
 
	 
	
    2.52
	 

	

    TMW Group


	
 
	 
	
    2.53
	 

	

    ARTICLE III — ELIGIBILITY AND PARTICIPATION


	
 
	 
	
 
	 

	

    Eligibility


	
 
	 
	
    3.1
	 

	

    Participation


	
 
	 
	
    3.2
	 

	

    ARTICLE IV — GENERAL PROVISIONS RELATING TO
    AWARDS


	
 
	 
	
 
	 

	

    Authority to Grant Awards


	
 
	 
	
    4.1
	 

	

    Dedicated Shares; Maximum Awards


	
 
	 
	
    4.2
	 

	

    Shares That Count Against Limit


	
 
	 
	
    4.3
	 

	

    Non-Transferability


	
 
	 
	
    4.4
	 

	

    Requirements of Law


	
 
	 
	
    4.5
	 

	

    Changes in the Company’s Capital Structure


	
 
	 
	
    4.6
	 

	

    Election Under Section 83(b) of the Code


	
 
	 
	
    4.7
	 

	

    Forfeiture for Cause


	
 
	 
	
    4.8
	 

	

    Forfeiture Events


	
 
	 
	
    4.9
	 

	

    Award Agreements


	
 
	 
	
    4.10
	 

	

    Amendment of Award Agreements


	
 
	 
	
    4.11
	 

	

    Rights as Stockholder


	
 
	 
	
    4.12
	 

	

    Issuance of Shares of Stock


	
 
	 
	
    4.13
	 

	

    Restrictions on Stock Received


	
 
	 
	
    4.14
	 

	

    Compliance With Section 409A


	
 
	 
	
    4.15
	 

	

    Source of Shares Deliverable Under Awards


	
 
	 
	
    4.16
	 

	

    ARTICLE V — OPTIONS


	
 
	 
	
 
	 

	

    Authority to Grant Options


	
 
	 
	
    5.1
	 

	

    Type of Options Available


	
 
	 
	
    5.2
	 

	

    Option Agreement


	
 
	 
	
    5.3
	 

	

    Option Price


	
 
	 
	
    5.4
	 

	

    Duration of Options


	
 
	 
	
    5.5
	 

	

    Amount Exercisable


	
 
	 
	
    5.6
	 

	

    Exercise of Options


	
 
	 
	
    5.7
	 

	

    Transferability of Options


	
 
	 
	
    5.8
	 

	

    Notification of Disqualifying Disposition


	
 
	 
	
    5.9
	 

	

    No Rights as Stockholder


	
 
	 
	
    5.10
	 

	

    $100,000 Limitation on Incentive Stock Options


	
 
	 
	
    5.11
	 

	

    ARTICLE VI — STOCK APPRECIATION RIGHTS


	
 
	 
	
 
	 

	

    Authority to Grant Stock Appreciation Rights Awards


	
 
	 
	
    6.1
	 

	

    Type of Stock Appreciation Rights Available


	
 
	 
	
    6.2
	 

	

    General Terms


	
 
	 
	
    6.3
	 





    

    ii








 





	 	 	 	 	 
	
 
	
 
	
    Section

	 

	

    Stock Appreciation Right Agreement


	
 
	 
	
    6.4
	 

	

    Term of Stock Appreciation Rights


	
 
	 
	
    6.5
	 

	

    Exercise of Freestanding SARs


	
 
	 
	
    6.6
	 

	

    Exercise of Tandem SARs


	
 
	 
	
    6.7
	 

	

    Payment of SAR Amount


	
 
	 
	
    6.8
	 

	

    Termination of Employment or Termination of Service


	
 
	 
	
    6.9
	 

	

    Nontransferability of SARs


	
 
	 
	
    6.10
	 

	

    No Rights as Stockholder


	
 
	 
	
    6.11
	 

	

    Restrictions on Stock Received


	
 
	 
	
    6.12
	 

	

    ARTICLE VII — RESTRICTED STOCK AWARDS


	
 
	 
	
 
	 

	

    Restricted Stock Awards


	
 
	 
	
    7.1
	 

	

    Restricted Stock Award Agreement


	
 
	 
	
    7.2
	 

	

    Holder’s Rights as Stockholder


	
 
	 
	
    7.3
	 

	

    ARTICLE VIII — DEFERRED STOCK UNIT AWARDS


	
 
	 
	
 
	 

	

    Authority to Grant Deferred Stock Unit Awards


	
 
	 
	
    8.1
	 

	

    Deferred Stock Unit Awards


	
 
	 
	
    8.2
	 

	

    Deferred Stock Unit Award Agreement


	
 
	 
	
    8.3
	 

	

    Dividend Equivalents


	
 
	 
	
    8.4
	 

	

    Form of Payment Under Deferred Stock Unit Award


	
 
	 
	
    8.5
	 

	

    Time of Payment Under Deferred Stock Unit Award


	
 
	 
	
    8.6
	 

	

    Holder’s Rights as Stockholder


	
 
	 
	
    8.7
	 

	

    ARTICLE IX — PERFORMANCE STOCK AND PERFORMANCE
    UNIT AWARDS


	
 
	 
	
 
	 

	

    Authority to Grant Performance Stock and Performance Unit
    Awards


	
 
	 
	
    9.1
	 

	

    Time of Payment Under Performance Unit Award


	
 
	 
	
    9.2
	 

	

    Holder’s Rights as Stockholder With Respect to a
    Performance Stock Award


	
 
	 
	
    9.3
	 

	

    Increases Prohibited


	
 
	 
	
    9.4
	 

	

    Stockholder Approval


	
 
	 
	
    9.5
	 

	

    Dividend Equivalents


	
 
	 
	
    9.6
	 

	

    ARTICLE X — CASH-BASED AWARDS AND OTHER
    STOCK-BASED AWARDS


	
 
	 
	
 
	 

	

    Authority to Grant Cash-Based Awards


	
 
	 
	
    10.1
	 

	

    Authority to Grant Other Stock-Based Awards


	
 
	 
	
    10.2
	 

	

    Value of Cash-Based Awards and Other Stock-Based Awards


	
 
	 
	
    10.3
	 

	

    Payment of Cash-Based Awards and Other Stock-Based Awards


	
 
	 
	
    10.4
	 

	

    Termination of Employment or Service


	
 
	 
	
    10.5
	 

	

    Nontransferability


	
 
	 
	
    10.6
	 

	

    ARTICLE XI — SUBSTITUTION AWARDS


	
 
	 
	
 
	 

	

    ARTICLE XII — ADMINISTRATION


	
 
	 
	
 
	 

	

    Awards


	
 
	 
	
    12.1
	 

	

    Authority of the Committee


	
 
	 
	
    12.2
	 

	

    Decisions Binding


	
 
	 
	
    12.3
	 

	

    No Liability


	
 
	 
	
    12.4
	 

	

    ARTICLE XIII — AMENDMENT OR TERMINATION OF
    PLAN


	
 
	 
	
 
	 

	

    Amendment, Modification, Suspension, and Termination


	
 
	 
	
    13.1
	 

	

    Awards Previously Granted


	
 
	 
	
    13.2
	 

	

    ARTICLE XIV — MISCELLANEOUS


	
 
	 
	
 
	 

	

    Unfunded Plan/No Establishment of a Trust Fund


	
 
	 
	
    14.1
	 

	

    No Employment Obligation


	
 
	 
	
    14.2
	 





    

    iii








 





	 	 	 	 	 
	
 
	
 
	
    Section

	 

	

    Tax Withholding


	
 
	 
	
    14.3
	 

	

    Written Agreement


	
 
	 
	
    14.4
	 

	

    Indemnification of the Committee


	
 
	 
	
    14.5
	 

	

    Gender and Number


	
 
	 
	
    14.6
	 

	

    Severability


	
 
	 
	
    14.7
	 

	

    Headings


	
 
	 
	
    14.8
	 

	

    Other Compensation Plans


	
 
	 
	
    14.9
	 

	

    Other Awards


	
 
	 
	
    14.10
	 

	

    Successors


	
 
	 
	
    14.11
	 

	

    Law Limitations/Governmental Approvals


	
 
	 
	
    14.12
	 

	

    Delivery of Title


	
 
	 
	
    14.13
	 

	

    Inability to Obtain Authority


	
 
	 
	
    14.14
	 

	

    Investment Representations


	
 
	 
	
    14.15
	 

	

    Persons Residing Outside of the United States


	
 
	 
	
    14.16
	 

	

    No Fractional Shares


	
 
	 
	
    14.17
	 

	

    Arbitration of Disputes


	
 
	 
	
    14.18
	 

	

    Governing Law


	
 
	 
	
    14.19
	 










    

    iv








 







    THE
    MEN’S WEARHOUSE, INC.

    2004 LONG-TERM INCENTIVE PLAN

    (As Amended and Restated Effective April 1, 2008)



 




    WITNESSETH:
    



 



    WHEREAS, effective March 29, 2004, The Men’s
    Wearhouse, Inc. (the “Company”) adopted The
    Men’s Wearhouse, Inc. 2004 Long-Term Incentive Plan (the
    “Plan”) for the benefit of key employees of the
    Company and affiliates of the Company;



 



    WHEREAS, the Company desires to allow non-employee
    directors of the Company to receive awards under the Plan;



 



    WHEREAS, the Company desires to restate the limitations
    set forth in the Plan on the number of shares of stock available
    for awards granted or paid in shares of stock to reflect the
    three-for-two stock split effected by the Company through the
    payment of a 50 percent stock dividend to shareholders of
    record as of May 31, 2005, and the Company desires to
    increase the aggregate number of shares of stock with respect to
    which awards may be granted under the Plan by
    1,210,059 shares; and



 



    WHEREAS, the Company desires to amend and restate the
    Plan on behalf of itself and on behalf of the other adopting
    entities;



 



    NOW THEREFORE, the Plan is hereby amended and restated in
    its entirety as follows, effective as of April 1, 2008,
    except insofar as an earlier effective date is expressly
    specified.













 







    ARTICLE I

    



 




    ESTABLISHMENT,
    PURPOSE AND DURATION
    



 



    1.1 Establishment.  The Company has
    previously established the incentive compensation plan known as
    “The Men’s Wearhouse, Inc. 2004 Long-Term Incentive
    Plan”. The Plan permits the grant of Options (both
    Incentive Stock Options and Nonqualified Stock Options), Stock
    Appreciation Rights, Restricted Stock, Deferred Stock Units,
    Performance Stock Awards, Performance Units, Cash-Based Awards,
    and Other Stock-Based Awards. The Plan became effective on
    March 29, 2004, the date the Plan was approved by the
    Board, which date was within one year of the date the Plan was
    approved by the holders of at least a majority of the
    outstanding shares of voting stock of the Company at a meeting
    of the stockholders of the Company (the “Effective
    Date”), and shall remain in effect as provided in
    Section 1.3.



 



    1.2 Purpose of the Plan.  The purpose of
    the Plan is to reward certain non-employee directors of the
    Company and certain corporate officers and other employees of
    the Company and its Affiliates (collectively, the “TMW
    Group”) by enabling them to acquire shares of common
    stock of the Company and to receive other compensation based on
    the increase in value of the common stock of the Company or
    certain other performance measures. The Plan is intended to
    advance the best interests of the Company, its Affiliates and
    its stockholders by providing those persons who have substantial
    responsibility for the direction, management and growth of the
    TMW Group with additional performance incentives and an
    opportunity to obtain or increase their proprietary interest in
    the Company, thereby encouraging them to continue in their
    employment or affiliation with the TMW Group.



 



    1.3 Duration of Authority to Make Grants Under the
    Plan.  The Plan shall continue indefinitely until
    it is terminated pursuant to Section 13.1. No Awards may be
    granted under the Plan on or after the tenth anniversary of the
    Effective Date. The applicable provisions of the Plan will
    continue in effect with respect to an Award granted under the
    Plan for as long as such Award remains outstanding.




    

    I-1








 







    ARTICLE II

    



 




    DEFINITIONS
    



 



    The words and phrases defined in this Article shall have the
    meaning set out below throughout the Plan, unless the context in
    which any such word or phrase appears reasonably requires a
    broader, narrower or different meaning.



 



    2.1 “Affiliate” means any corporation,
    partnership, limited liability company or association, trust or
    other entity or organization which, directly or indirectly,
    controls, is controlled by, or is under common control with, the
    Company. For purposes of the preceding sentence,
    “control” (including, with correlative meanings, the
    terms “controlled by” and “under common control
    with”), as used with respect to any entity or organization,
    shall mean the possession, directly or indirectly, of the power
    (a) to vote more than 50 percent (50%) of the
    securities having ordinary voting power for the election of
    directors of the controlled entity or organization, or
    (b) to direct or cause the direction of the management and
    policies of the controlled entity or organization, whether
    through the ownership of voting securities or by contract or
    otherwise.



 



    2.2 “Award” means, individually or
    collectively, a grant under the Plan of Incentive Stock Options,
    Nonqualified Stock Options, Stock Appreciation Rights,
    Restricted Stock, Deferred Stock Units, Performance Stock
    Awards, Performance Units, Cash-Based Awards, and Other
    Stock-Based Awards, in each case subject to the terms and
    provisions of the Plan.



 



    2.3 “Award Agreement” means an agreement
    that sets forth the terms and conditions applicable to an Award
    granted under the Plan.



 



    2.4 “Board” means the board of directors
    of the Company.



 



    2.5 “Cash-Based Award” means an Award
    granted to a Holder pursuant to Article X.



 



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



 



    2.7 “Committee” means (a) in the case
    of an Award granted to a Director, the Board, and (b) in
    the case of any other Award granted under the Plan, a committee
    of at least two persons, who are members of the Compensation
    Committee of the Board and are appointed by the Compensation
    Committee of the Board, or, to the extent it chooses to operate
    as the Committee, the Compensation Committee of the Board. Each
    member of the Committee in respect of his or her participation
    in any decision with respect to an Award that is intended to
    satisfy the requirements of section 162(m) of the Code must
    satisfy the requirements of “outside director” status
    within the meaning of section 162(m) of the Code; provided,
    however, that the failure to satisfy such requirement shall not
    affect the validity of the action of any committee otherwise
    duly authorized and acting in the matter. As to Awards, grants
    or other transactions that are authorized by the Committee and
    that are intended to be exempt under
    Rule 16b-3,
    the requirements of
    Rule 16b-3(d)(1)
    with respect to committee action must also be satisfied.



 



    2.8 “Company” means The Men’s
    Wearhouse, Inc., a Texas corporation, or any successor (by
    reincorporation, merger or otherwise).



 



    2.9 “Corporate Change” shall have the
    meaning ascribed to that term in Section 4.6(c).



 



    2.10 “Covered Employee” means a Holder who
    is a “covered employee,” as defined in
    section 162(m) of the Code and the regulations promulgated
    thereunder, or any successor statute.



 



    2.11 “Deferred Stock Unit” means a unit
    credited to a Holder’s ledger account maintained by the
    Company pursuant to Article VIII.



 



    2.12 “Deferred Stock Unit Award” means an
    Award granted pursuant to Article VIII.



 



    2.13 “Director” means a member of the
    Board who is not an Employee.



 



    2.14 “Disability” means, effective for
    awards issued under the Plan that are earned and vested on or
    after January 1, 2005, as determined by the Committee in
    its discretion exercised in good faith, (a) in the case of
    an Award that is exempt from the application of the requirements
    of Section 409A, a physical or mental condition of the
    Holder that would entitle him to payment of disability income
    payments under the Company’s long-term disability insurance
    policy or plan for employees as then in effect; or in the event
    that the Holder is a Director or is not covered,




    

    II-1








 






    for whatever reason, under the Company’s long-term
    disability insurance policy or plan for employees or in the
    event the Company does not maintain such a long-term disability
    insurance policy, “Disability” means a permanent and
    total disability as defined in section 22(e)(3) of the Code
    and (b) in the case of an Award that is not exempt from the
    application of the requirements of Section 409A,
    (i) the Holder is unable to engage in any substantial
    gainful activity by reason of any medically determinable
    physical or mental impairment that can be expected to result in
    death or can be expected to last for a continuous period of not
    less than 12 months, or (ii) the Holder is, by reason
    of any medically determinable physical or mental impairment that
    can be expected to result in death or can be expected to last
    for a continuous period of not less than 12 months,
    receiving income replacement benefits for a period of not less
    than three months under an accident and health plan covering
    employees of the Company. A determination of Disability may be
    made by a physician selected or approved by the Committee and,
    in this respect, the Holder shall submit to an examination by
    such physician upon request by the Committee.



 



    2.15 “Dividend Equivalent” means a payment
    equivalent in amount to dividends paid to the Company’s
    stockholders.



 



    2.16 “Effective Date” shall have the
    meaning ascribed to that term in Section 1.1.



 



    2.17 “Employee” means (a) a person
    employed by the Company or any Affiliate as a common law
    employee or (b) a person who has agreed to become a common
    law employee of the Company or any Affiliate and is expected to
    become such within six (6) months from the date of a
    determination made for purposes of the Plan.



 



    2.18 “Exchange Act” means the United
    States Securities Exchange Act of 1934, as amended from time to
    time.



 



    2.19 “Fair Market Value” of the Stock as of any
    particular date means,



 



    (a)  if the Stock is traded on a stock exchange,



 



    (i) and if the Stock is traded on that date, the closing
    sale price of the Stock on that date; or



 



    (ii) and if the Stock is not traded on that date, the
    closing sale price of the Stock on the last trading date
    immediately preceding that date;



 



    as reported on the principal securities exchange on which the
    Stock is traded; or



 


			
	 	    (b)  
	
    if the Stock is traded in the over-the-counter market,




 



    (i) and if the Stock is traded on that date, the average
    between the high bid and low asked price on that date; or



 



    (ii) and if the Stock is not traded on that date, the
    average between the high bid and low asked price on the last
    trading date immediately preceding that date;



 



    as reported in such over-the-counter market; provided, however,
    that (x) if the Stock is not so traded, or (y) if, in
    the discretion of the Committee, another means of determining
    the fair market value of a share of Stock at such date shall be
    necessary or advisable, the Committee may provide for another
    means for determining such fair market value that complies with
    the requirements of Section 409A.



 



    2.20 “Fiscal Year” means the
    Company’s fiscal year.



 



    2.21 “Freestanding SAR” means a SAR that
    is granted pursuant to Article VI independently of any
    Option.



 



    2.22 “Holder” means a person who has been
    granted an Award or any person who is entitled to receive shares
    of Stock (and/or cash in the case of a Stock Appreciation Right)
    under an Award.



 



    2.23 “Incentive Stock Option” or
    “ISO” means an option which is intended, as
    evidenced by its designation, as an incentive stock option
    within the meaning of section 422 of the Code, the award of
    which contains such provisions (including but not limited to the
    receipt of stockholder approval of the Plan, if the Award is
    made prior to such approval) and is made under such
    circumstances and to such persons as may be necessary to comply
    with that section.



 



    2.24 “Mature Shares” means shares of Stock
    that the Holder has held for at least six months.




    

    II-2








 






    2.25 “Minimum Statutory Tax Withholding
    Obligation” means, with respect to an Award, the amount
    the Company or an Affiliate is required to withhold for federal,
    state and local taxes based upon the applicable minimum
    statutory withholding rates required by the relevant tax
    authorities.



 



    2.26 “Nonqualified Stock Option” or
    “NQSO” means an Option that is designated as a
    nonqualified stock option. Any Option granted hereunder that is
    not designated as an incentive stock option shall be deemed to
    be designated a nonqualified stock option under the Plan and not
    an incentive stock option under the Code.



 



    2.27 “Option” means an Incentive Stock
    Option or a Nonqualified Stock Option granted pursuant to
    Article V.



 



    2.28 “Optionee” means a person who is
    granted an Option under the Plan.



 



    2.29 “Option Price” shall have the meaning
    ascribed to that term in Section 5.4.



 



    2.30 “Option Agreement” means a written
    contract setting forth the terms and conditions of an Option.



 



    2.31 “Other Stock-Based Award” means an
    equity-based or equity-related Award not otherwise described by
    the terms and provisions of the Plan that is granted pursuant to
    Article X.



 



    2.32 “Parent Corporation” means any
    corporation (other than the Company) in an unbroken chain of
    corporations ending with the Company if, at the time of the
    action or transaction, each of the corporations other than the
    Company owns stock possessing 50 percent or more of the
    total combined voting power of all classes of stock in one of
    the other corporations in the chain.



 



    2.33 “Performance-Based Award” means a
    Performance Stock Award, a Performance Unit, or a Cash-Based
    Award granted to a Holder under which the fulfillment of
    performance goals determines the degree of payout or vesting.



 



    2.34 “Performance-Based Compensation”
    means compensation under an Award that satisfies the
    requirements of section 162(m) of the Code for
    deductibility of remuneration paid to Covered Employees.



 



    2.35 “Performance Goals” means one or more
    of the criteria described in Article IX on which the
    performance goals applicable to an Award are based.



 



    2.36 “Performance Period” means the period
    of time during which the performance goals applicable to a
    Performance-Based Award must be met.



 



    2.37 “Performance Stock Award” means an
    Award designated as a performance stock award granted to a
    Holder pursuant to Article IX.



 



    2.38 “Performance Unit Award” means an
    Award designated as a performance unit award granted to a Holder
    pursuant to Article IX.



 



    2.39 “Period of Restriction” means the
    period during which Restricted Stock is subject to a substantial
    risk of forfeiture (based on the passage of time, the
    achievement of Performance Goals, or upon the occurrence of
    other events as determined by the Committee, in its discretion),
    as provided in Article VII.



 



    2.40 “Plan” means The Men’s
    Wearhouse, Inc. 2004 Long-Term Incentive Plan, as set forth in
    this document and as it may be amended from time to time.



 



    2.41 “Restricted Stock” means shares of
    restricted Stock issued or granted under the Plan pursuant to
    Article VII.



 



    2.42 “Restricted Stock Award” means an
    authorization by the Committee to issue or transfer Restricted
    Stock to a Holder.



 



    2.43 “Retirement” means (a) in the
    case of an Employee, retirement in accordance with the terms of
    a retirement plan that is qualified under section 401(a) of
    the Code and maintained by the Company or an Affiliate in which
    the Holder is a participant and (b) in the case of a
    Director, retirement from the Board in accordance with the
    Board’s then applicable retirement policy.




    

    II-3








 






    2.44 “Section 409A” means
    section 409A of the Code and Department of Treasury rules
    and regulations issued thereunder.



 



    2.45 “Stock Appreciation Right” or
    “SAR” means any stock appreciation right
    granted pursuant to Article VI of the Plan.



 



    2.46 “Stock” means the common stock of the
    Company, $.01 par value per share (or such other par value
    as may be designated by act of the Company’s stockholders).



 



    2.47 “Subsidiary Corporation” means any
    corporation (other than the Company) in an unbroken chain of
    corporations beginning with the Company if, at the time of the
    action or transaction, each of the corporations other than the
    last corporation in an unbroken chain owns stock possessing
    50 percent or more of the total combined voting power of
    all classes of stock in one of the other corporations in the
    chain.



 



    2.48 “Substantial Risk of Forfeiture”
    shall have the meaning ascribed to that term in
    Section 409A.



 



    2.49 “Tandem SAR” means a SAR that is
    granted in connection with a related Option pursuant to
    Article VI, the exercise of which shall require forfeiture
    of the right to purchase a share of the Stock under the related
    Option (and when a share of the Stock is purchased under the
    Option, the Tandem SAR shall similarly be canceled).



 



    2.50 “Ten Percent Stockholder” means
    an individual who, at the time the Option is granted, owns stock
    possessing more than ten percent (10%) of the total combined
    voting power of all classes of stock or series of the Company or
    of any Parent Corporation or Subsidiary Corporation. An
    individual shall be considered as owning the stock owned,
    directly or indirectly, by or for his brothers and sisters
    (whether by the whole or half blood), spouse, ancestors and
    lineal descendants; and stock owned, directly or indirectly, by
    or for a corporation, partnership, estate or trust, shall be
    considered as being owned proportionately by or for its
    stockholders, partners or beneficiaries.



 



    2.51 “Termination of Employment” means, in
    the case of an Award issued to an Employee other than an
    Incentive Stock Option, the termination of the Employee’s
    employment relationship with the Company and all Affiliates.
    “Termination of Employment” means, in the case
    of an Incentive Stock Option, the termination of the
    Employee’s employment relationship with all of the Company,
    any Parent Corporation, any Subsidiary Corporation and any
    parent or subsidiary corporation (within the meaning of
    section 422(a)(2) of the Code) of any such corporation that
    issues or assumes an Incentive Stock Option in a transaction to
    which section 424(a) of the Code applies.



 



    2.52 “Termination of Service” means, in
    the case of an Award issued to a Director, the termination of
    the Director’s service on the Board.



 



    2.53 “TMW Group” shall have the meaning
    ascribed to that term in Section 1.2.




    

    II-4








 







    ARTICLE III
    



 




    ELIGIBILITY
    AND PARTICIPATION
    



 



    3.1 Eligibility.  The persons who are
    eligible to receive Awards under the Plan, other than Incentive
    Stock Options, are key Employees who have substantial
    responsibility for or involvement with the management and growth
    of one or more members of the TMW Group and Directors. However,
    only those persons who are, on the dates of grant, key employees
    of the Company or any Parent Corporation or Subsidiary
    Corporation are eligible for grants of Incentive Stock Options
    under the Plan.



 



    3.2 Participation.  Subject to the terms
    and provisions of the Plan, the Committee may, from time to
    time, select the eligible persons to whom Awards shall be
    granted and shall determine the nature and amount of each Award.




    

    III-1








 







    ARTICLE IV
    



 



    GENERAL PROVISIONS RELATING TO AWARDS



 



    4.1 Authority to Grant Awards.  The
    Committee may grant Awards to those key Employees and Directors
    as the Committee shall from time to time determine, under the
    terms and conditions of the Plan. Subject only to any applicable
    limitations set out in the Plan, the number of shares of Stock
    or other value to be covered by any Award to be granted under
    the Plan shall be as determined by the Committee in its sole
    discretion.



 



    4.2 Dedicated Shares; Maximum Awards.  The
    aggregate number of shares of Stock with respect to which Awards
    may be granted under the Plan is 2,110,059. The aggregate number
    of shares of Stock with respect to which Incentive Stock Options
    may be granted under the Plan is 2,110,059. The aggregate number
    of shares of Stock with respect to which Nonqualified Stock
    Options may be granted under the Plan is 2,110,059. The
    aggregate number of shares of Stock with respect to which Stock
    Appreciation Rights may be granted under the Plan is 2,110,059.
    The aggregate number of shares of Stock with respect to which
    Restricted Stock Awards may be granted under the Plan is
    1,055,030. The aggregate number of shares of Stock with respect
    to which Performance Stock Awards may be granted under the Plan
    is 1,055,030. The maximum number of shares of Stock with respect
    to which Incentive Stock Options may be granted to an Employee
    during a Fiscal Year is 300,000. The maximum number of shares of
    Stock with respect to which Nonqualified Stock Options may be
    granted to an Employee or Director during a Fiscal Year is
    300,000. The maximum number of shares of Stock with respect to
    which Stock Appreciation Rights may be granted to an Employee or
    Director during a Fiscal Year is 300,000. The maximum number of
    shares of Stock with respect to which Restricted Stock Awards
    may be granted to an Employee or Director during a Fiscal Year
    is 225,000. The maximum amount with respect to which Deferred
    Stock Unit Awards may be granted to an Employee or Director
    during a Fiscal Year may not exceed in value the Fair Market
    Value of 225,000 shares of Stock determined as of the date
    of grant. The maximum number of shares of Stock with respect to
    which Performance Stock Awards may be granted to an Employee or
    Director during a Fiscal Year is 225,000. The maximum number of
    shares of Stock with respect to which Performance Unit Awards
    may be granted to an Employee or Director during a Fiscal Year
    is 225,000. The maximum number of shares of Stock with respect
    to which Other Stock-Based Awards may be granted to an Employee
    during a Fiscal Year is 225,000. The maximum aggregate amount
    with respect to which Cash-Based Awards may be awarded or
    credited to an Employee or Director during a Fiscal Year may not
    exceed in value $3,000,000 determined as of the date of grant.
    The maximum aggregate amount with respect to which Performance
    Unit Awards may be awarded or credited to an Employee or
    Director during a Fiscal Year may not exceed in value $3,000,000
    determined as of the date of grant. Each of the foregoing
    numerical limits stated in this Section 4.2 shall be
    subject to adjustment in accordance with the provisions of
    Section 4.6. The number of shares of Stock stated in this
    Section 4.2 shall also be increased by such number of
    shares of Stock as become subject to substitute Awards granted
    pursuant to Article XI; provided, however, that such
    increase shall be conditioned upon the approval of the
    stockholders of the Company to the extent stockholder approval
    is required by law or applicable stock exchange rules.



 



    4.3 Shares That Count Against Limit.



 



    (a) If any outstanding Award expires or terminates for any
    reason, is settled in cash in lieu of shares of Stock or any
    Award is surrendered, the shares of Stock allocable to the
    unexercised portion of that Award may again be subject to an
    Award granted under the Plan.



 



    (b) For Awards granted under the Plan before April 1,
    2008, if shares of Stock are withheld from payment of the Award
    to satisfy tax obligations with respect to such Award, such
    shares of Stock will not count against the aggregate number of
    shares of Stock with respect to which Awards may be granted
    under the Plan. For Awards granted under the Plan on or after
    April 1, 2008, if shares of Stock are withheld from payment
    of the Award to satisfy tax obligations with respect to such
    Award, such shares of Stock will count against the aggregate
    number of shares of Stock with respect to which Awards may be
    granted under the Plan.



 



    (c) If a Stock Appreciation Right is exercised, only the
    number of shares of Stock actually issued shall be charged
    against the maximum number of shares of Stock that may be
    delivered pursuant to Awards under the Plan.




    

    IV-1








 






    4.4 Non-Transferability.  Except as
    specified in the applicable Award Agreement or in a domestic
    relations court order, an Award shall not be transferable by the
    Holder (whether for consideration or otherwise) other than by
    will or under the laws of descent and distribution, and shall be
    exercisable, during the Holder’s lifetime, only by him or
    her. Any attempted assignment of an Award in violation of this
    Section 4.4 shall be null and void. In the discretion of
    the Committee, any attempt to transfer an Award other than under
    the terms of the Plan and the applicable Award Agreement may
    terminate the Award. No ISO granted under the Plan may be sold,
    transferred, pledged, assigned or otherwise alienated or
    hypothecated, other than by will or by the laws of descent and
    distribution. Further, all ISOs granted to an Employee under the
    Plan shall be exercisable during his or her lifetime only by the
    Employee, and after that time, by the Employee’s heirs or
    estate.



 



    4.5 Requirements of Law.  The Company
    shall not be required to sell or issue any shares of Stock under
    any Award if issuing those shares of Stock would constitute or
    result in a violation by the Holder or the Company of any
    provision of any law, statute or regulation of any governmental
    authority. Specifically, in connection with any applicable
    statute or regulation relating to the registration of
    securities, upon exercise of any Option or pursuant to any other
    Award, the Company shall not be required to issue any shares of
    Stock unless the Committee has received evidence satisfactory to
    it to the effect that the Holder will not transfer the shares of
    Stock except in accordance with applicable law, including
    receipt of an opinion of counsel satisfactory to the Company to
    the effect that any proposed transfer complies with applicable
    law. The determination by the Committee on this matter shall be
    final, binding and conclusive. The Company may, but shall in no
    event be obligated to, register any shares of Stock covered by
    the Plan pursuant to applicable securities laws of any country
    or any political subdivision. In the event the shares of Stock
    issuable on exercise of an Option or pursuant to any other Award
    are not registered, the Company may imprint on the certificate
    evidencing the shares of Stock any legend that counsel for the
    Company considers necessary or advisable to comply with
    applicable law, or, should the shares of Stock be represented by
    book or electronic entry rather than a certificate, the Company
    may take such steps to restrict transfer of the shares of Stock
    as counsel for the Company considers necessary or advisable to
    comply with applicable law. The Company shall not be obligated
    to take any other affirmative action in order to cause or enable
    the exercise of an Option or any other Award, or the issuance of
    shares of Stock pursuant thereto, to comply with any law or
    regulation of any governmental authority.



 



    4.6 Changes in the Company’s Capital Structure.



 



    (a) The existence of outstanding Awards shall not affect in
    any way the right or power of the Company or its stockholders to
    make or authorize any or all adjustments, recapitalizations,
    reorganizations or other changes in the Company’s capital
    structure or its business, any merger or consolidation of the
    Company, any issue of bonds, debentures, preferred or prior
    preference shares ahead of or affecting the Stock or Stock
    rights, the dissolution or liquidation of the Company, any sale
    or transfer of all or any part of its assets or business or any
    other corporate act or proceeding, whether of a similar
    character or otherwise.



 



    (b) If the Company shall effect a subdivision or
    consolidation of Stock or other capital readjustment, the
    payment of a Stock dividend, or other increase or reduction of
    the number of shares of Stock outstanding, without receiving
    compensation therefor in money, services or property, then
    (1) the number, class or series and per share price of
    Stock subject to outstanding Options or other Awards under the
    Plan shall be appropriately adjusted (subject to the restriction
    in Section 4.11 prohibiting repricing) in such a manner as
    to entitle a Holder to receive upon exercise of an Option or
    other Award, for the same aggregate cash consideration, the
    equivalent total number and class or series of Stock the Holder
    would have received had the Holder exercised his or her Option
    or other Award in full immediately prior to the event requiring
    the adjustment, and (2) the number and class or series of
    Stock then reserved to be issued under the Plan shall be
    adjusted by substituting for the total number and class or
    series of Stock then reserved that number and class or series of
    Stock that would have been received by the owner of an equal
    number of outstanding shares of Stock of each class or series of
    Stock as the result of the event requiring the adjustment.



 



    (c) If while unexercised Options or other Awards remain
    outstanding under the Plan (1) the Company shall not be the
    surviving entity in any merger, consolidation or other
    reorganization (or survives only as a subsidiary of an entity
    other than an entity that was wholly-owned by the Company
    immediately prior to such merger, consolidation or other
    reorganization), (2) the Company sells, leases or exchanges
    or agrees to sell,




    

    IV-2








 






    lease or exchange all or substantially all of its assets to any
    other person or entity (other than an entity wholly-owned by the
    Company), (3) the Company is to be dissolved or
    (4) the Company is a party to any other corporate
    transaction (as defined under section 424(a) of the Code
    and applicable Department of Treasury regulations) that is not
    described in clauses (1), (2) or (3) of this sentence
    (each such event is referred to herein as a “Corporate
    Change”), then, except as otherwise provided in an
    Award Agreement or another agreement between the Holder and the
    Company (provided that such exceptions shall not apply in the
    case of a reincorporation merger), or as a result of the
    Committee’s effectuation of one or more of the alternatives
    described below, there shall be no acceleration of the time at
    which any Award then outstanding may be exercised, and no later
    than ten days after the approval by the stockholders of the
    Company of such Corporate Change, the Committee, acting in its
    sole and absolute discretion without the consent or approval of
    any Holder, shall act to effect one or more of the following
    alternatives, which may vary among individual Holders and which
    may vary among Awards held by any individual Holder (provided
    that, with respect to a reincorporation merger in which Holders
    of the Company’s ordinary shares will receive one ordinary
    share of the successor corporation for each ordinary share of
    the Company, none of such alternatives shall apply and, without
    Committee action, each Award shall automatically convert into a
    similar award of the successor corporation exercisable for the
    same number of ordinary shares of the successor as the Award was
    exercisable for ordinary shares of Stock of the Company):



 



    (1) accelerate the time at which some or all of the Awards
    then outstanding may be exercised so that such Awards may be
    exercised in full for a limited period of time on or before a
    specified date (before or after such Corporate Change) fixed by
    the Committee, after which specified date all such Awards that
    remain unexercised and all rights of Holders thereunder shall
    terminate;



 



    (2) require the mandatory surrender to the Company by all
    or selected Holders of some or all of the then outstanding
    Awards held by such Holders (irrespective of whether such Awards
    are then exercisable under the provisions of the Plan or the
    applicable Award Agreement evidencing such Award) as of a date,
    before or after such Corporate Change, specified by the
    Committee, in which event the Committee shall thereupon cancel
    such Award and the Company shall pay to each such Holder an
    amount of cash per share equal to the excess, if any, of the per
    share price offered to stockholders of the Company in connection
    with such Corporate Change over the exercise prices under such
    Award for such shares;



 



    (3) with respect to all or selected Holders, have some or
    all of their then outstanding Awards (whether vested or
    unvested) assumed or have a new award of a similar nature
    substituted for some or all of their then outstanding Awards
    under the Plan (whether vested or unvested) by an entity which
    is a party to the transaction resulting in such Corporate Change
    and which is then employing such Holder or which is affiliated
    or associated with such Holder in the same or a substantially
    similar manner as the Company prior to the Corporate Change, or
    a parent or subsidiary of such entity, provided that
    (A) such assumption or substitution is on a basis where the
    excess of the aggregate fair market value of the Stock subject
    to the Award immediately after the assumption or substitution
    over the aggregate exercise price of such Stock is equal to the
    excess of the aggregate fair market value of all Stock subject
    to the Award immediately before such assumption or substitution
    over the aggregate exercise price of such Stock, and
    (B) the assumed rights under such existing Award or the
    substituted rights under such new Award, as the case may be,
    will have the same terms and conditions as the rights under the
    existing Award assumed or substituted for, as the case may be;



 



    (4) provide that the number and class or series of Stock
    covered by an Award (whether vested or unvested) theretofore
    granted shall be adjusted so that such Award when exercised
    shall thereafter cover the number and class or series of Stock
    or other securities or property (including, without limitation,
    cash) to which the Holder would have been entitled pursuant to
    the terms of the agreement or plan relating to such Corporate
    Change if, immediately prior to such Corporate Change, the
    Holder had been the holder of record of the number of shares of
    Stock then covered by such Award; or



 



    (5) make such adjustments to Awards then outstanding as the
    Committee deems appropriate to reflect such Corporate Change
    (provided, however, that the Committee may determine in its sole
    and absolute discretion that no such adjustment is necessary).




    

    IV-3








 






    In effecting one or more of the alternatives set out in
    paragraphs (3), (4) or (5) immediately above, and
    except as otherwise may be provided in an Award Agreement, the
    Committee, in its sole and absolute discretion and without the
    consent or approval of any Holder, may accelerate the time at
    which some or all Awards then outstanding may be exercised.



 



    (d) In the event of changes in the outstanding Stock by
    reason of recapitalizations, reorganizations, mergers,
    consolidations, combinations, exchanges or other relevant
    changes in capitalization occurring after the date of the grant
    of any Award and not otherwise provided for by this
    Section 4.6, any outstanding Award and any Award Agreement
    evidencing such Award shall be subject to adjustment by the
    Committee in its sole and absolute discretion as to the number
    and price of Stock or other consideration subject to such Award.
    In the event of any such change in the outstanding Stock, the
    aggregate number of shares of Stock available under the Plan may
    be appropriately adjusted by the Committee, whose determination
    shall be conclusive.



 



    (e) After a merger of one or more corporations into the
    Company or after a consolidation of the Company and one or more
    corporations in which the Company shall be the surviving
    corporation, each Holder shall be entitled to have his
    Restricted Stock appropriately adjusted based on the manner in
    which the shares of Stock were adjusted under the terms of the
    agreement of merger or consolidation.



 



    (f) The issuance by the Company of stock of any class or
    series, or securities convertible into, or exchangeable for,
    stock of any class or series, for cash or property, or for labor
    or services either upon direct sale or upon the exercise of
    rights or warrants to subscribe for them, or upon conversion or
    exchange of stock or obligations of the Company convertible
    into, or exchangeable for, stock or other securities, shall not
    affect, and no adjustment by reason of such issuance shall be
    made with respect to, the number, class or series, or price of
    shares of Stock then subject to outstanding Options or other
    Awards.



 



    4.7 Election Under Section 83(b) of the
    Code.  No Holder shall exercise the election
    permitted under section 83(b) of the Code with respect to
    any Award without the prior written approval of the Chief
    Financial Officer of the Company. Any Holder who makes an
    election under section 83(b) of the Code with respect to
    any Award without the prior written approval of the Chief
    Financial Officer of the Company may, in the discretion of the
    Committee, forfeit any or all Awards granted to him or her under
    the Plan.



 



    4.8 Forfeiture for Cause.  Notwithstanding
    any other provision of the Plan or an Award Agreement, if the
    Committee finds by a majority vote that a Holder, before or
    after his Termination of Employment or severance of affiliation
    relationship with the Company and all Affiliates,
    (a) committed fraud, embezzlement, theft, felony or an act
    of dishonesty in the course of his employment by or affiliation
    with the Company or an Affiliate which conduct damaged the
    Company or an Affiliate, (b) disclosed trade secrets of the
    Company or an Affiliate or (c) violated the terms of any
    non-competition, non-disclosure or similar agreement with
    respect to the Company or any Affiliate to which the Holder is a
    party, then as of the date the Committee makes its finding some
    or all Awards awarded to the Holder (including vested Awards
    that have been exercised, vested Awards that have not been
    exercised and Awards that have not yet vested), as determined by
    the Committee in its sole discretion, and all net proceeds
    realized with respect to any such Awards, will be forfeited to
    the Company on such terms as determined by the Committee. The
    findings and decision of the Committee with respect to such
    matter, including those regarding the acts of the Holder and the
    damage done to the Company, will be final for all purposes. No
    decision of the Committee, however, will affect the finality of
    the discharge of the individual by the Company or an Affiliate
    or severance of the individual’s affiliation with the
    Company and all Affiliates.



 



    4.9 Forfeiture Events.  The Committee may
    specify in an Award Agreement that the Holder’s rights,
    payments, and benefits with respect to an Award shall be subject
    to reduction, cancellation, forfeiture, or recoupment upon the
    occurrence of certain specified events, in addition to any
    otherwise applicable vesting or performance conditions of an
    Award. Such events may include, but shall not be limited to,
    Termination of Employment for cause, termination of the
    Holder’s provision of services to the Company or its
    Affiliates, violation of material policies of the TMW Group,
    breach of noncompetition, confidentiality, or other restrictive
    covenants that may apply to the Holder, or other conduct by the
    Holder that is detrimental to the business or reputation of the
    TMW Group.




    

    IV-4








 






    4.10 Award Agreements.  Each Award shall
    be embodied in a written Award Agreement that shall be subject
    to the terms and conditions of the Plan. The Award Agreement
    shall be signed by an executive officer of the Company, other
    than the Holder, on behalf of the Company, and may be signed by
    the Holder to the extent required by the Committee. The Award
    Agreement may specify the effect of a change in control of the
    Company on the Award. The Award Agreement may contain any other
    provisions that the Committee in its discretion shall deem
    advisable which are not inconsistent with the terms and
    provisions of the Plan.



 



    4.11 Amendments of Award Agreements.  The
    terms of any outstanding Award under the Plan may be amended
    from time to time by the Committee in its discretion in any
    manner that it deems appropriate and that is consistent with the
    terms of the Plan. However, no such amendment shall adversely
    affect in a material manner any right of a Holder without his or
    her written consent. Except as specified in Section 4.6(c),
    the Committee may not directly or indirectly lower the exercise
    price of a previously granted Option or the grant price of a
    previously granted SAR.



 



    4.12 Rights as Stockholder.  A Holder
    shall not have any rights as a stockholder with respect to Stock
    covered by an Option, a SAR, a DSU or a Performance Unit Award
    payable in Stock until the date, if any, such Stock is issued by
    the Company; and, except as otherwise provided in
    Section 4.6, no adjustment for dividends, or otherwise,
    shall be made if the record date therefor is prior to the date
    of issuance of such Stock.



 



    4.13 Issuance of Shares of Stock.  Shares
    of Stock, when issued, may be represented by a certificate or by
    book or electronic entry.



 



    4.14 Restrictions on Stock Received.  The
    Committee may impose such conditions
    and/or
    restrictions on any shares of Stock issued pursuant to an Award
    as it may deem advisable or desirable. These restrictions may
    include, but shall not be limited to, a requirement that the
    Holder hold the shares of Stock for a specified period of time.



 



    4.15 Compliance With
    Section 409A.  Awards shall be designed,
    granted and administered in such a manner that they are either
    exempt from the application of, or comply with, the requirements
    of Section 409A. If the Committee determines that an Award,
    Award Agreement, payment, distribution, deferral election,
    transaction, or any other action or arrangement contemplated by
    the provisions of the Plan would, if undertaken, cause a Holder
    to become subject to additional taxes under Section 409A,
    then unless the Committee specifically provides otherwise, such
    Award, Award Agreement, payment, distribution, deferral
    election, transaction or other action or arrangement shall not
    be given effect to the extent it causes such result and the
    related provisions of the Plan
    and/or Award
    Agreement will be deemed modified, or, if necessary, suspended
    in order to comply with the requirements of Section 409A to
    the extent determined appropriate by the Committee, in each case
    without the consent of or notice to the Holder. The
    exercisability of an Option or a SAR shall not be extended to
    the extent that such extension would subject the Holder to
    additional taxes under Section 409A. This Section 4.15
    is effective for awards issued under the Plan that are earned
    and vested on or after January 1, 2005.



 



    4.16 Source of Shares Deliverable Under
    Awards.  Any shares of Stock delivered pursuant to
    an Award may consist, in whole or in part, of authorized and
    unissued shares of Stock or of treasury shares of Stock.




    

    IV-5








 







    ARTICLE V
    



 



    OPTIONS



 



    5.1 Authority to Grant Options.  Subject
    to the terms and provisions of the Plan, the Committee, at any
    time, and from time to time, may grant Options under the Plan to
    eligible persons in such number and upon such terms as the
    Committee shall determine.



 



    5.2 Type of Options Available.  Options
    granted under the Plan may be Incentive Stock Options intended
    to satisfy the requirements of section 422 of the Code or
    Nonqualified Stock Options that are not intended to satisfy the
    requirements of section 422 of the Code.



 



    5.3 Option Agreement.  Each Option grant
    under the Plan shall be evidenced by an Option Agreement that
    shall specify (a) whether the Option is intended to be an
    ISO or a NQSO, (b) the Option Price, (c) the duration
    of the Option, (d) the number of shares of Stock to which
    the Option pertains, (e) the exercise restrictions
    applicable to the Option, and (f) such other provisions as
    the Committee shall determine that are not inconsistent with the
    terms and provisions of the Plan. Notwithstanding the
    designation of an Option as an ISO in the applicable Option
    Agreement, to the extent the limitations of section 422 of
    the Code are exceeded with respect to the Option, the portion of
    the Option in excess of the limitation shall be treated as a
    NQSO. Effective for Options granted under the Plan on or after
    January 1, 2005, an Option granted under the Plan may not
    be granted with any Dividend Equivalents rights.



 



    5.4 Option Price.  The price at which
    shares of Stock may be purchased under an Option (the
    “Option Price”) shall not be less than
    100 percent (100%) of the Fair Market Value of the shares
    of Stock on the date the Option is granted. However, in the case
    of a Ten Percent Stockholder, the Option Price for an
    Incentive Stock Option shall not be less than 110 percent
    (110%) of the Fair Market Value of the shares of Stock on the
    date the Incentive Stock Option is granted. Subject to the
    limitations set forth in the preceding sentences of this
    Section 5.4, the Committee shall determine the Option Price
    for each grant of an Option under the Plan.



 



    5.5 Duration of Options.  An Option shall
    not be exercisable after the earlier of (i) the general
    term of the Option specified in Section 5.5(a), or
    (ii) the period of time specified herein that follows the
    Optionee’s death, Disability, Retirement or other
    Termination of Employment or Termination of Service. Unless the
    Optionee’s applicable Option Agreement specifies otherwise,
    an Option shall not continue to vest after the Optionee’s
    Termination of Employment or Termination of Service for any
    reason other than the death or Disability of the Optionee.



 



    (a) General Term of Option.  Unless the
    Option Agreement specifies a shorter general term, an Option
    shall expire on the tenth anniversary of the date the Option is
    granted. Notwithstanding the foregoing, unless the Option
    Agreement specifies a shorter term, in the case of an Incentive
    Stock Option granted to a Ten Percent Stockholder, the
    Option shall expire on the fifth anniversary of the date the
    Option is granted.



 



    (b) Early Termination of Option Due to Termination of
    Employment or Termination of Service Other Than for Death,
    Disability or Retirement.  Except as may be
    otherwise expressly provided by the Committee in an Option
    Agreement, an Option shall terminate on the earlier of
    (1) the date of the expiration of the general term of the
    Option or (2) the date that is one day less than one month
    after the date of the Optionee’s Termination of Employment
    or Termination of Service, whether with or without cause, for
    any reason other than the death, Disability or Retirement of the
    Optionee, during which period the Optionee shall be entitled to
    exercise the Option in respect of the number of shares of Stock
    that the Optionee would have been entitled to purchase had the
    Optionee exercised the Option on the date of such Termination of
    Employment or Termination of Service. The Committee shall
    determine whether an authorized leave of absence, absence on
    military or government service, or any other absence from
    service shall constitute a termination of the employment
    relationship between the Optionee and the Company and all
    Affiliates. Notwithstanding the foregoing, in the case of an
    Incentive Stock Option, if an Optionee has an authorized leave
    of absence from employment with the Company, a Parent
    Corporation or a Subsidiary Corporation that exceeds
    90 days and the Optionee’s right to reemployment is
    not guaranteed by either statute or contract, the Optionee will
    be deemed to incur a Termination of Employment on the
    91st day
    of such leave.




    

    V-1








 






    (c) Early Termination of Option Due to
    Death.  Unless the Committee specifies otherwise
    in the applicable Option Agreement, in the event of the
    Optionee’s Termination of Employment or Termination of
    Service due to death before the date of expiration of the
    general term of the Option, the Optionee’s Option shall
    terminate on the earlier of the date of expiration of the
    general term of the Option or the first anniversary of the date
    of the Optionee’s death, during which period the
    Optionee’s executors or administrators or such persons to
    whom such Options were transferred by will or by the laws of
    descent and distribution, shall be entitled to exercise the
    Option in respect of the number of shares of Stock that the
    Optionee would have been entitled to purchase had the Optionee
    exercised the Option on the date of his death.



 



    (d) Early Termination of Option Due to
    Disability.  Unless the Committee specifies
    otherwise in the applicable Option Agreement, in the event of
    the Termination of Employment or Termination of Service due to
    Disability before the date of the expiration of the general term
    of the Option, the Optionee’s Option shall terminate on the
    earlier of the expiration of the general term of the Option or
    the first anniversary of the date of the Termination of
    Employment or Termination of Service due to Disability, during
    which period the Optionee shall be entitled to exercise the
    Option in respect of the number of shares of Stock that the
    Optionee would have been entitled to purchase had the Optionee
    exercised the Option on the date of such Termination of
    Employment or Termination of Service.



 



    (e) Early Termination of Option Due to
    Retirement.  Unless the Committee specifies
    otherwise in the applicable Option Agreement, in the event of
    the Optionee’s Termination of Employment or Termination of
    Service due to Retirement before the date of the expiration of
    the general term of the Option, the Optionee’s Option shall
    terminate on the earlier of the expiration of the general term
    of the Option or the first anniversary of the date of the
    Termination of Employment or Termination of Service due to
    Retirement, during which period the Optionee shall be entitled
    to exercise the Option in respect of the number of shares of
    Stock that the Optionee would have been entitled to purchase had
    the Optionee exercised the Option on the date of such
    Termination of Employment or Termination of Service.



 



    After the death of the Optionee, the Optionee’s executors,
    administrators or any person or persons to whom the
    Optionee’s Option may be transferred by will or by the laws
    of descent and distribution, shall have the right, at any time
    prior to the termination of the Option to exercise the Option,
    in respect to the number of all of the remaining unexercised and
    unexpired shares of Stock subject to the Option.



 



    5.6 Amount Exercisable.  Each Option may
    be exercised at the time, in the manner and subject to the
    conditions the Committee specifies in the Option Agreement in
    its sole discretion. Unless the Committee specifies otherwise in
    an applicable Option Agreement, an Option Agreement shall set
    forth the following terms regarding the exercise of the Option
    covered by the Option Agreement:



 



    (a) No Option granted under the Plan may be exercised until
    an Optionee has completed one year of continuous employment with
    the Company or any subsidiary of the Company or one year of
    service on the Board following the date of grant;



 



    (b) Beginning on the day after the first anniversary of the
    date of grant, an Option may be exercised up to
    1/3
    of the shares subject to the Option;



 



    (c) After the expiration of each succeeding anniversary
    date of the date of grant, the Option may be exercised up to an
    additional
    1/3
    of the shares initially subject to the Option, so that after the
    expiration of the third anniversary of the date of grant, the
    Option shall be exercisable in full;



 



    (d) To the extent not exercised, installments shall be
    cumulative and may be exercised in whole or in part until the
    Option expires on the tenth anniversary of the date of grant.



 



    However, the Committee, in its discretion, may change the terms
    of exercise so that any Option may be exercised so long as it is
    valid and outstanding from time to time in part or as a whole in
    such manner and subject to such conditions as the Committee may
    set. In addition, the Committee, in its discretion, may
    accelerate the time in which any outstanding Option may be
    exercised. However, in no event shall any Option be exercisable
    on or after the tenth anniversary of the date of the grant of
    the Option.




    

    V-2








 






    5.7 Exercise of Options.



 



    (a) General Method of Exercise.  Subject
    to the terms and provisions of the Plan and an Optionee’s
    Option Agreement, Options may be exercised in whole or in part
    from time to time by the delivery of written notice in the
    manner designated by the Committee stating (1) that the
    Optionee wishes to exercise such option on the date such notice
    is so delivered, (2) the number of shares of Stock with
    respect to which the Option is to be exercised and (3) the
    address to which the certificate representing such shares of
    Stock should be mailed. Except in the case of exercise by a
    third party broker as provided below, in order for the notice to
    be effective the notice must be accompanied by payment of the
    Option Price and any applicable tax withholding amounts which
    must be made at the time of exercise by any combination of the
    following: (a) cash, certified check, bank draft or postal
    or express money order for an amount equal to the Option Price
    under the Option, (b) Mature Shares with a Fair Market
    Value on the date of exercise equal to the Option Price under
    the Option (if approved in advance by the Committee or an
    executive officer of the Company), (c) an election to make
    a cashless exercise through a registered broker-dealer (if
    approved in advance by the Committee or an executive officer of
    the Company) or (d) except as specified below, any other
    form of payment which is acceptable to the Committee. If Mature
    Shares are used for payment by the Optionee, the aggregate Fair
    Market Value of the shares of Stock tendered must be equal to or
    less than the aggregate Option Price of the shares of Stock
    being purchased upon exercise of the Option, and any difference
    must be paid by cash, certified check, bank draft or postal or
    express money order payable to the order of the Company.



 



    If, at the time of receipt by the Company or its delegate of
    such written notice, (i) the Company has unrestricted
    surplus in an amount not less than the Option Price of such
    shares of Stock, (ii) all accrued cumulative preferential
    dividends and other current preferential dividends on all
    outstanding shares of preferred stock of the Company have been
    fully paid, (iii) the acquisition by the Company of its own
    shares of Stock for the purpose of enabling such Optionee to
    exercise such Option is otherwise permitted by applicable law,
    does not require any vote or consent of any stockholder of the
    Company and does not violate the terms of any agreement to which
    the Company is a party or by which it is bound, and
    (iv) there shall have been adopted, and there shall be in
    full force and effect, a resolution of the Board authorizing the
    acquisition by the Company of its own shares of stock for such
    purpose, then such Optionee may deliver to the Company, in
    payment of the Option Price of the shares of Stock with respect
    to which such Option is exercised, (x) certificates
    registered in the name of such Optionee that represent a number
    of shares of stock legally and beneficially owned by such
    Optionee (free of all liens, claims and encumbrances of every
    kind) and having a Fair Market Value on the date of receipt by
    the Company or its delegate of such written notice that is not
    greater than the Option Price of the shares of Stock with
    respect to which such Option is to be exercised, such
    certificates to be accompanied by stock powers duly endorsed in
    blank by the record holder of the shares of Stock represented by
    such certificates, with the signature of such record holder
    guaranteed by a national banking association, and (y) if
    the Option Price of the shares of Stock with respect to which
    such Option is to be exercised exceeds such Fair Market Value, a
    cashier’s check drawn on a national banking association and
    payable to the order of the Company, in an amount, in United
    States dollars, equal to the amount of such excess.
    Notwithstanding the provisions of the immediately preceding
    sentence, the Committee, in its sole discretion, may refuse to
    accept shares of Stock in payment of the Option Price of the
    shares of Stock with respect to which such Option is to be
    exercised and, in that event, any certificates representing
    shares of Stock that were received by the Company or its
    delegate with such written notice shall be returned to such
    Optionee, together with notice by the Company or its delegate to
    such Optionee of the refusal of the Committee to accept such
    shares of Stock. If, at the expiration of seven business days
    after the delivery to such Optionee of such written notice from
    the Company or its delegate, such Optionee shall not have
    delivered to the Company or its delegate a cashier’s check
    drawn on a national banking association and payable to the order
    of the Company in an amount, in United States dollars, equal to
    the Option Price of the shares of Stock with respect to which
    such Option is to be exercised, such written notice from the
    Optionee to the Company or its delegate shall be ineffective to
    exercise such Option.



 



    Whenever an Option is exercised by exchanging shares of Stock
    owned by the Optionee, the Optionee shall deliver to the Company
    or its delegate certificates registered in the name of the
    Optionee representing a number of shares of Stock legally and
    beneficially owned by the Optionee, free of all liens, claims,
    and encumbrances of every kind, accompanied by stock powers duly
    endorsed in blank by the record holder of the shares represented
    by the certificates, (with signature guaranteed by a commercial
    bank or trust company or by a brokerage firm having a membership
    on a registered national stock exchange). The delivery of
    certificates upon the exercise of Option is




    

    V-3








 






    subject to the condition that the person exercising the Option
    provide the Company with the information the Company might
    reasonably request pertaining to exercise, sale or other
    disposition of an Option.



 



    (b) Issuance of Shares.  Subject to
    Section 4.4 and Section 5.7(c), as promptly as
    practicable after receipt of written notification and payment,
    in the form required by Section 5.7(a), of an amount of
    money necessary to satisfy any withholding tax liability that
    may result from the exercise of such Option, the Company shall
    deliver to the Optionee certificates for the number of shares
    with respect to which the Option has been exercised, issued in
    the Optionee’s name. Delivery of the shares shall be deemed
    effected for all purposes when a stock transfer agent of the
    Company shall have deposited the certificates in the United
    States mail, addressed to the Optionee, at the address specified
    by the Optionee.



 



    (c) Exercise Through Third-Party
    Broker.  The Committee may permit an Optionee to
    elect to pay the Option Price and any applicable tax withholding
    resulting from such exercise by authorizing a third-party broker
    to sell all or a portion of the shares of Stock acquired upon
    exercise of the Option and remit to the Company a sufficient
    portion of the sale proceeds to pay the Option Price and any
    applicable tax withholding resulting from such exercise.



 



    (d) Limitations on Exercise
    Alternatives.  The Committee shall not permit an
    Optionee to pay such Optionee’s Option Price upon the
    exercise of an Option by having the Company reduce the number of
    shares of Stock that will be delivered pursuant to the exercise
    of the Option. In addition, the Committee shall not permit an
    Optionee to pay such Optionee’s Option Price upon the
    exercise of an Option by using shares of Stock other than Mature
    Shares. An Option may not be exercised for a fraction of a share
    of Stock.



 



    5.8 Transferability of Options.



 



    (a) Incentive Stock Options.  No ISO
    granted under the Plan may be sold, transferred, pledged,
    assigned or otherwise alienated or hypothecated, other than by
    will or by the laws of descent and distribution. Further, all
    ISOs granted to an Optionee under the Plan shall be exercisable
    during his or her lifetime only by the Optionee, and after that
    time, by the Optionee’s heirs or estate.



 



    (b) Nonqualified Stock
    Options.    Except as otherwise provided
    in an Optionee’s Option Agreement, no NQSO granted under
    the Plan may be sold, transferred, pledged, assigned, or
    otherwise alienated or hypothecated, other than by will or by
    the laws of descent and distribution. Further, except as
    otherwise provided in an Optionee’s Option Agreement, all
    NQSOs granted to an Optionee under the Plan shall be exercisable
    during his or her lifetime only by such Optionee.



 



    Any attempted assignment of an Option in violation of this
    Section 5.8 shall be null and void.



 



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



 



    5.10 No Rights as Stockholder.  An
    Optionee shall not have any rights as a stockholder with respect
    to Stock covered by an Option until the date a stock certificate
    for such Stock is issued by the Company; and, except as
    otherwise provided in Section 4.6, no adjustment for
    dividends, or otherwise, shall be made if the record date
    therefor is prior to the date of issuance of such certificate.



 



    5.11 $100,000 Limitation on Incentive Stock
    Options.  To the extent that the aggregate Fair
    Market Value of Stock with respect to which Incentive Stock
    Options first become exercisable by a Holder in any calendar
    year exceeds $100,000, taking into account both shares of Stock
    subject to Incentive Stock Options under the Plan and Stock
    subject to incentive stock options under all other plans of the
    Company, such Options shall be treated as Nonqualified Stock
    Options. For this purpose, the “Fair Market Value” of
    the Stock subject to Options shall be determined as of the date
    the Options were awarded. In reducing the number of Options
    treated as Incentive Stock Options to meet the $100,000 limit,
    the most recently granted Options shall be reduced first. To the
    extent a reduction of simultaneously granted Options is
    necessary to meet the $100,000 limit, the Committee may, in the
    manner and to the extent permitted by law, designate which
    shares of Stock are to be treated as shares acquired pursuant to
    the exercise of an Incentive Stock Option.




    

    V-4








 







    ARTICLE VI
    



 



    STOCK APPRECIATION RIGHTS



 



    6.1 Authority to Grant Stock Appreciation Rights
    Awards.  Subject to the terms and provisions of
    the Plan, the Committee, at any time, and from time to time, may
    grant Stock Appreciation Rights under the Plan to eligible
    persons in such number and upon such terms as the Committee
    shall determine. Subject to the terms and conditions of the
    Plan, the Committee shall have complete discretion in
    determining the number of SARs granted to each Holder and,
    consistent with the provisions of the Plan, in determining the
    terms and conditions pertaining to such SARs.



 



    6.2 Type of Stock Appreciation Rights
    Available.  SARs granted under the Plan may be
    Freestanding SARs, Tandem SARs or any combination of these forms
    of SARs.



 



    6.3 General Terms.  Subject to the terms
    and conditions of the Plan, a SAR granted under the Plan shall
    confer on the recipient a right to receive, upon exercise
    thereof, a cash amount equal to the excess of (a) the Fair
    Market Value of one share of the Stock on the date of exercise
    over (b) the grant price of the SAR, which shall not be
    less than 100 percent of the Fair Market Value of one share
    of the Stock on the date of grant of the SAR and in no event
    less than par value of one share of the Stock. The grant price
    of a Freestanding SAR shall not be less than the Fair Market
    Value of a share of the Stock on the date of grant of the SAR.
    The grant price of a Tandem SAR shall equal the Option Price of
    the Option which is related to the Tandem SAR. Effective for
    SARs granted under the Plan on or after January 1, 2005, a
    SAR granted under the Plan may not be granted with any Dividend
    Equivalents rights.



 



    6.4 Stock Appreciation Right
    Agreement.  Each Award of SARs granted under the
    Plan shall be evidenced by an Award Agreement that shall specify
    (a) whether the SAR is intended to be a Freestanding SAR or
    a Tandem SAR, (b) the grant price of the SAR, (c) the
    term of the SAR, (d) the vesting and termination provisions
    and (e) such other provisions as the Committee shall
    determine that are not inconsistent with the terms and
    provisions of the Plan. The Committee may impose such additional
    conditions or restrictions on the exercise of any SAR as it may
    deem appropriate.



 



    6.5 Term of Stock Appreciation
    Rights.  The term of a SAR granted under the Plan
    shall be determined by the Committee, in its sole discretion;
    provided that no SAR shall be exercisable on or after the tenth
    anniversary date of its grant.



 



    6.6 Exercise of Freestanding
    SARs.  Subject to the terms and provisions of the
    Plan and the applicable Award Agreement, Freestanding SARs may
    be exercised in whole or in part from time to time by the
    delivery of written notice in the manner designated by the
    Committee stating (a) that the Holder wishes to exercise
    such SAR on the date such notice is so delivered, (b) the
    number of shares of Stock with respect to which the SAR is to be
    exercised and (c) the address to which the payment due
    under such SAR should be mailed. In accordance with applicable
    law, a Freestanding SAR may be exercised upon whatever
    additional terms and conditions the Committee, in its sole
    discretion, imposes.



 



    6.7 Exercise of Tandem SARs.



 



    (a) Subject to the terms and provisions of the Plan and the
    applicable Award Agreement, Tandem SARs may be exercised for all
    or part of the shares of Stock subject to the related Option
    upon the surrender of the right to exercise the equivalent
    portion of the related Option and by the delivery of written
    notice in the manner designated by the Committee stating
    (a) that the Holder wishes to exercise such SAR on the date
    such notice is so delivered, (b) the number of shares of
    Stock with respect to which the SAR is to be exercised and
    (c) the address to which the payment due under such SAR
    should be mailed. A Tandem SAR may be exercised only with
    respect to the shares of Stock for which its related Option is
    then exercisable. In accordance with applicable law, a Tandem
    SAR may be exercised upon whatever additional terms and
    conditions the Committee, in its sole discretion, imposes.



 



    (b) Notwithstanding any other provision of the Plan to the
    contrary, with respect to a Tandem SAR granted in connection
    with an ISO: (1) the Tandem SAR will expire no later than
    the expiration of the underlying ISO; (2) the value of the
    payout with respect to the Tandem SAR may be for no more than
    100 percent (100%) of the excess of the Fair Market Value
    of the shares of Stock subject to the underlying ISO at the time
    the Tandem SAR is exercised




    

    VI-1








 






    over the Option Price of the underlying ISO; and (3) the
    Tandem SAR may be exercised only when the Fair Market Value of
    the shares of Stock subject to the ISO exceeds the Option Price
    of the ISO.



 



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



 



    (a) The excess of the Fair Market Value of a share of the
    Stock on the date of exercise over the grant price of the SAR by



 



    (b) The number of shares of Stock with respect to which the
    SAR is exercised.



 



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



 



    6.9 Termination of Employment or Termination of
    Service.  Each Award Agreement shall set forth the
    extent to which the grantee of a SAR shall have the right to
    exercise the SAR following the grantee’s Termination of
    Employment or Termination of Service. Such provisions shall be
    determined in the sole discretion of the Committee, may be
    included in the Award Agreement entered into with the grantee,
    and need not be uniform among all SARs issued pursuant to the
    Plan and may reflect distinctions based on the reasons for
    termination.



 



    6.10 Nontransferability of SARs.  Except
    as otherwise provided in a Holder’s Award Agreement, no SAR
    granted under the Plan may be sold, transferred, pledged,
    assigned or otherwise alienated or hypothecated, other than by
    will or by the laws of descent and distribution. Further, except
    as otherwise provided in a Holder’s Award Agreement, all
    SARs granted to a Holder under the Plan shall be exercisable
    during his or her lifetime only by the Holder, and after that
    time, by the Holder’s heirs or estate. Any attempted
    assignment of a SAR in violation of this Section 6.10 shall
    be null and void.



 



    6.11 No Rights as Stockholder.  A grantee
    of a SAR award, as such, shall have no rights as a stockholder.



 



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




    

    VI-2








 







    ARTICLE VII
    



 



    RESTRICTED STOCK AWARDS



 



    7.1 Restricted Stock Awards.  Subject to
    the terms and conditions of the Plan, the Committee, at any
    time, and from time to time, may make Awards of Restricted Stock
    to eligible persons in such numbers and upon such terms as the
    Committee shall determine. The amount of, the vesting and the
    transferability restrictions applicable to any Restricted Stock
    Award shall be determined by the Committee in its sole
    discretion. If the Committee imposes vesting or transferability
    restrictions on a Holder’s rights with respect to
    Restricted Stock, the Committee may issue such instructions to
    the Company’s share transfer agent in connection therewith
    as it deems appropriate. The Committee may also cause the
    certificate for shares of Stock issued pursuant to a Restricted
    Stock Award to be imprinted with any legend which counsel for
    the Company considers advisable with respect to the restrictions
    or, should the shares of Stock be represented by book or
    electronic entry rather than a certificate, the Company may take
    such steps to restrict transfer of the shares of Stock as
    counsel for the Company considers necessary or advisable to
    comply with applicable law.



 



    7.2 Restricted Stock Award
    Agreement.  Each Restricted Stock Award shall be
    evidenced by an Award Agreement that contains any vesting,
    transferability restrictions and other provisions not
    inconsistent with the Plan as the Committee may specify.



 



    7.3 Holder’s Rights as
    Stockholder.  Subject to the terms and conditions
    of the Plan, each recipient of a Restricted Stock Award shall
    have all the rights of a stockholder with respect to the shares
    of Restricted Stock included in the Restricted Stock Award
    during the Period of Restriction established for the Restricted
    Stock Award. Dividends paid with respect to Restricted Stock in
    cash or property other than shares of Stock or rights to acquire
    shares of Stock shall be paid to the recipient of the Restricted
    Stock Award currently. Dividends paid in shares of Stock or
    rights to acquire shares of Stock shall be added to and become a
    part of the Restricted Stock. During the Period of Restriction,
    certificates representing the Restricted Stock shall be
    registered in the recipient’s name and bear a restrictive
    legend to the effect that ownership of such Restricted Stock,
    and the enjoyment of all rights appurtenant thereto, are subject
    to the restrictions, terms, and conditions provided in the Plan
    and the applicable Restricted Stock Award Agreement. Such
    certificates shall be deposited by the recipient with the
    Secretary of the Company or such other officer of the Company as
    may be designated by the Committee, together with all stock
    powers or other instruments of assignment, each endorsed in
    blank, which will permit transfer to the Company of all or any
    portion of the Restricted Stock which shall be forfeited in
    accordance with the Plan and the applicable Restricted Stock
    Award Agreement.




    

    VII-1








 







    ARTICLE VIII
    



 




    DEFERRED
    STOCK UNIT AWARDS
    



 



    8.1 Authority to Grant Deferred Stock Unit
    Awards.  Subject to the terms and provisions of
    the Plan, the Committee, at any time, and from time to time, may
    grant Deferred Stock Units under the Plan to eligible persons in
    such amounts and upon such terms as the Committee shall
    determine. The amount of, the vesting and the transferability
    restrictions applicable to any Deferred Stock Unit Award shall
    be determined by the Committee in its sole discretion. The
    Committee shall maintain a bookkeeping ledger account which
    reflects the number of Deferred Stock Units credited under the
    Plan for the benefit of a Holder.



 



    8.2 Deferred Stock Unit Awards.  A
    Deferred Stock Unit shall be similar in nature to Restricted
    Stock except that no shares of Stock are actually transferred to
    the Holder until a later date specified in the applicable Award
    Agreement. Each Deferred Stock Unit shall have a value equal to
    the Fair Market Value of a share of Stock.



 



    8.3 Deferred Stock Unit Award
    Agreement.  Each Deferred Stock Unit Award shall
    be evidenced by an Award Agreement that contains any Substantial
    Risk of Forfeiture, vesting, transferability restrictions, form
    and time of payment provisions and other provisions not
    inconsistent with the Plan as the Committee may specify.



 



    8.4 Dividend Equivalents.  Effective for
    Deferred Stock Awards granted under the Plan on or after
    January 1, 2005, an Award Agreement for a Deferred Stock
    Unit Award may specify that the Holder shall be entitled to the
    payment of Dividend Equivalents under the Award.



 



    8.5 Form of Payment Under Deferred Stock Unit
    Award.  Payment under a Deferred Stock Unit Award
    shall be made in either cash or shares of Stock as specified in
    the applicable Award Agreement.



 



    8.6 Time of Payment Under Deferred Stock Unit
    Award.  A Holder’s payment under a Deferred
    Stock Unit Award shall be made at such time as is specified in
    the applicable Award Agreement. The Award Agreement shall
    specify that the payment will be made (a) by a date that is
    no later than the date that is two and one-half
    (21/2)
    months after the end of the Fiscal Year in which the Deferred
    Stock Unit Award payment is no longer subject to a Substantial
    Risk of Forfeiture or (b) at a time that is permissible
    under Section 409A. This Section 8.6 is effective for
    awards issued under the Plan that are earned and vested on or
    after January 1, 2005.



 



    8.7 Holder’s Rights as
    Stockholder.  Each recipient of Deferred Stock
    Units shall have no rights of a stockholder with respect to the
    Holder’s Deferred Stock Units. A Holder shall have no
    voting rights with respect to any Deferred Stock Unit Awards.




    

    VIII-1








 







    ARTICLE IX
    



 




    PERFORMANCE
    STOCK AND PERFORMANCE UNIT AWARDS
    



 



    9.1 Authority to Grant Performance Stock and Performance
    Unit Awards.  Subject to the terms and provisions
    of the Plan, the Committee, at any time, and from time to time,
    may grant Performance Stock and Performance Unit Awards under
    the Plan to eligible persons in such amounts and upon such terms
    as the Committee shall determine. The amount of, the vesting and
    the transferability restrictions applicable to any Performance
    Stock or Performance Unit Award shall be based upon the
    attainment of such Performance Goals as the Committee may
    determine. A Performance Goal for a particular Performance Stock
    or Performance Unit Award must be established by the Committee
    prior to the earlier to occur of (a) 90 days after the
    commencement of the period of service to which the Performance
    Goal relates or (b) the lapse of 25 percent of the
    period of service, and in any event while the outcome is
    substantially uncertain. A Performance Goal must be objective
    such that a third party having knowledge of the relevant facts
    could determine whether the goal is met. Such a Performance Goal
    may be based on one or more business criteria that apply to the
    Employee, one or more business units of the Company, or the
    Company as a whole, with reference to one or more of the
    following: earnings per share, earnings per share growth, total
    shareholder return, economic value added, cash return on
    capitalization, increased revenue, revenue ratios (per employee
    or per customer), net income, stock price, market share, return
    on equity, return on assets, return on capital, return on
    capital compared to cost of capital, return on capital employed,
    return on invested capital, shareholder value, net cash flow,
    operating income, earnings before interest and taxes, cash flow,
    cash flow from operations, cost reductions, cost ratios (per
    employee or per customer), proceeds from dispositions, project
    completion time and budget goals, net cash flow before financing
    activities, customer growth and total market value. Goals may
    also be based on performance relative to a peer group of
    companies. Unless otherwise stated, such a Performance Goal need
    not be based upon an increase or positive result under a
    particular business criterion and could include, for example,
    maintaining the status quo or limiting economic losses
    (measured, in each case, by reference to specific business
    criteria). In interpreting Plan provisions applicable to
    Performance Goals and Performance Stock or Performance Unit
    Awards, it is intended that the Plan will conform with the
    standards of section 162(m) of the Code and Treasury
    Regulations § 1.162-27(e)(2)(i), and the Committee in
    establishing such goals and interpreting the Plan shall be
    guided by such provisions. Prior to the payment of any
    compensation based on the achievement of Performance Goals, the
    Committee must certify in writing that applicable Performance
    Goals and any of the material terms thereof were, in fact,
    satisfied. Subject to the foregoing provisions, the terms,
    conditions and limitations applicable to any Performance Stock
    or Performance Unit Awards made pursuant to the Plan shall be
    determined by the Committee. If the Committee imposes vesting or
    transferability restrictions on a recipient’s rights with
    respect to Performance Stock or Performance Unit Awards, the
    Committee may issue such instructions to the Company’s
    share transfer agent in connection therewith as it deems
    appropriate. The Committee may also cause the certificate for
    shares of Stock issued pursuant to a Performance Stock or
    Performance Unit Award to be imprinted with any legend which
    counsel for the Company considers advisable with respect to the
    restrictions or, should the shares of Stock be represented by
    book or electronic entry rather than a certificate, the Company
    may take such steps to restrict transfer of the shares of Stock
    as counsel for the Company considers necessary or advisable to
    comply with applicable law.



 



    Each Performance Stock or Performance Unit Award shall be
    evidenced by an Award Agreement that contains any vesting,
    transferability restrictions and other provisions not
    inconsistent with the Plan as the Committee may specify.



 



    9.2 Time of Payment Under Performance Unit
    Award.  A Holder’s payment under a
    Performance Unit Award shall be made at such time as is
    specified in the applicable Award Agreement. The Award Agreement
    shall specify that the payment will be made (a) by a date
    that is no later than the date that is two and one-half
    (21/2)
    months after the end of the calendar year in which the
    Performance Unit Award payment is no longer subject to a
    Substantial Risk of Forfeiture or (b) at a time that is
    permissible under Section 409A. This Section 9.2 is
    effective for awards issued under the Plan that are earned and
    vested on or after January 1, 2005.



 



    9.3 Holder’s Rights as Stockholder With Respect to
    a Performance Stock Award.  Subject to the terms
    and conditions of the Plan, each Holder of a Performance Stock
    Award shall have all the rights of a stockholder with respect to
    the shares of Stock issued to the Holder pursuant to the Award
    during any period in which such issued




    

    IX-1








 






    shares of Stock are subject to forfeiture and restrictions on
    transfer, including without limitation, the right to vote such
    shares of Stock.



 



    9.4 Increases Prohibited.  Neither the
    Committee nor the Board may increase the amount of compensation
    payable under a Performance Stock Award or Performance Unit
    Award. If the time at which a Performance Stock Award or
    Performance Unit Award will vest or be paid is accelerated for
    any reason, the number of shares of Stock subject to, or the
    amount payable under, the Performance Stock Award or Performance
    Unit Award shall be reduced pursuant to Department of Treasury
    Regulation § 1.162-27(e)(2)(iii) to reasonably reflect
    the time value of money.



 



    9.5 Stockholder Approval.  No payments of
    Stock or cash will be made pursuant to this Article IX
    unless the stockholder approval requirements of Department of
    Treasury Regulation § 1.162-27(e)(4) are satisfied.



 



    9.6 Dividend Equivalents.  Effective for
    Performance Unit Awards granted under the Plan on or after
    January 1, 2005, an Award Agreement for a Performance Unit
    Award may specify that the Holder shall be entitled to the
    payment of Dividend Equivalents under the Award.




    

    IX-2








 







    ARTICLE X
    



 




    CASH-BASED
    AWARDS AND OTHER STOCK-BASED AWARDS
    



 



    10.1 Authority to Grant Cash-Based
    Awards.  Subject to the terms and provisions of
    the Plan, the Committee, at any time, and from time to time, may
    grant Cash-Based Awards under the Plan to Employees in such
    amounts and upon such terms, including the achievement of
    specific performance goals, as the Committee shall determine.



 



    10.2 Authority to Grant Other Stock-Based
    Awards.  Subject to the terms and provisions of
    the Plan, the Committee, at any time, and from time to time, may
    grant other types of equity-based or equity-related Awards not
    otherwise described by the terms and provisions of the Plan
    (including the grant or offer for sale of unrestricted shares of
    Stock) under the Plan to eligible persons in such amounts and
    subject to such terms and conditions, as the Committee shall
    determine. Such Awards may involve the transfer of actual shares
    of Stock to Holders, or payment in cash or otherwise of amounts
    based on the value of shares of Stock and may include, without
    limitation, Awards designed to comply with or take advantage of
    the applicable local laws of jurisdictions other than the United
    States.



 



    10.3 Value of Cash-Based and Other Stock-Based
    Awards.  Each Cash-Based Award shall specify a
    payment amount or payment range as determined by the Committee.
    Each Other Stock-Based Award shall be expressed in terms of
    shares of Stock or units based on shares of Stock, as determined
    by the Committee. The Committee may establish performance goals
    in its discretion for Cash-Based Awards and Other Stock-Based
    Awards. If the Committee exercises its discretion to establish
    performance goals, the number
    and/or value
    of Cash-Based Awards or Other Stock-Based Awards that will be
    paid out to the Holder will depend on the extent to which the
    performance goals are met.



 



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



 



    10.5 Termination of Employment or Service
    .  The Committee shall determine the extent to
    which a grantee’s rights with respect to Cash-Based Awards
    and Other Stock-Based Awards shall be affected by the
    grantee’s Termination of Employment or Termination of
    Service. Such provisions shall be determined in the sole
    discretion of the Committee and need not be uniform among all
    Awards of Cash-Based Awards and Other Stock-Based Awards issued
    pursuant to the Plan.



 



    10.6 Nontransferability.  Except as
    otherwise determined by the Committee, neither Cash-Based Awards
    nor Other Stock-Based Awards may be sold, transferred, pledged,
    assigned, or otherwise alienated or hypothecated, other than by
    will or by the laws of descent and distribution. Further, except
    as otherwise provided by the Committee, a Holder’s rights
    under the Plan, if exercisable, shall be exercisable during his
    or her lifetime only by such Holder.




    

    X-1








 







    ARTICLE XI
    



 




    SUBSTITUTION
    AWARDS
    



 



    Awards may be granted under the Plan from time to time in
    substitution for stock options and other awards held by
    employees and directors of other corporations who are about to
    become Employees, or whose employer is about to become a parent
    or subsidiary corporation as contemplated in Section 3.1,
    conditioned in the case of an Incentive Stock Option upon the
    employee becoming an employee of the Company or a parent or
    subsidiary corporation of the Company, as the result of a merger
    of consolidation of the Company with another corporation, or the
    acquisition by the Company of substantially all the assets of
    another corporation, or the acquisition by the Company of at
    least 50 percent (50%) of the issued and outstanding stock
    of another corporation as the result of which it becomes a
    subsidiary of the Company. The terms and conditions of the
    substitute Awards so granted may vary from the terms and
    conditions set forth in the Plan to such extent as the Board at
    the time of grant may deem appropriate to conform, in whole or
    in part, to the provisions of the Award in substitution for
    which they are granted, but with respect to Options that are
    Incentive Stock Options, no such variation shall be such as to
    affect the status of any such substitute Option as an incentive
    stock option under section 422 of the Code.




    

    XI-1








 







    ARTICLE XII
    



 




    ADMINISTRATION
    



 



    12.1 Awards.  The Plan shall be
    administered by the Committee or, in the absence of the
    Committee or in the case of awards issued to Directors, the Plan
    shall be administered by the Board. The members of the Committee
    (that is not itself the Board) shall serve at the discretion of
    the Board. The Committee shall have full and exclusive power and
    authority to administer the Plan and to take all actions that
    the Plan expressly contemplates or are necessary or appropriate
    in connection with the administration of the Plan with respect
    to Awards granted under the Plan.



 



    12.2 Authority of the Committee.  The
    Committee shall have full and exclusive power to interpret and
    apply the terms and provisions of the Plan and Awards made under
    the Plan, and to adopt such rules, regulations and guidelines
    for implementing the Plan as the Committee may deem necessary or
    proper, all of which powers shall be exercised in the best
    interests of the Company and in keeping with the objectives of
    the Plan. A majority of the members of the Committee shall
    constitute a quorum for the transaction of business, and the
    vote of a majority of those members present at any meeting shall
    decide any question brought before that meeting. Any decision or
    determination reduced to writing and signed by a majority of the
    members shall be as effective as if it had been made by a
    majority vote at a meeting properly called and held. All
    questions of interpretation and application of the Plan, or as
    to Awards granted under the Plan, shall be subject to the
    determination, which shall be final and binding, of a majority
    of the whole Committee. When appropriate, the Plan shall be
    administered in order to qualify certain of the Options granted
    hereunder as Incentive Stock Options. No member of the Committee
    shall be liable for any act or omission of any other member of
    the Committee or for any act or omission on his own part,
    including but not limited to the exercise of any power or
    discretion given to him under the Plan, except those resulting
    from his own gross negligence or willful misconduct. In carrying
    out its authority under the Plan, the Committee shall have full
    and final authority and discretion, including but not limited to
    the following rights, powers and authorities, to:



 



    (a) determine the persons to whom and the time or times at
    which Awards will be made;



 



    (b) determine the number and exercise price of shares of
    Stock covered in each Award, subject to the terms and provisions
    of the Plan;



 



    (c) determine the terms, provisions and conditions of each
    Award, which need not be identical and need not match the
    default terms set forth in the Plan;



 



    (d) accelerate the time at which any outstanding Award will
    vest;



 



    (e) prescribe, amend and rescind rules and regulations
    relating to administration of the Plan; and



 



    (f) make all other determinations and take all other
    actions deemed necessary, appropriate or advisable for the
    proper administration of the Plan.



 



    The Committee may make an Award to an individual who the Company
    expects to become an Employee of the Company or any of its
    Affiliates within six (6) months after the date of grant of
    the Award, with the Award being subject to and conditioned on
    the individual actually becoming an Employee within that time
    period and subject to other terms and conditions as the
    Committee may establish. The Committee may correct any defect or
    supply any omission or reconcile any inconsistency in the Plan
    or in any Award to a Holder in the manner and to the extent the
    Committee deems necessary or desirable to further the
    Plan’s objectives. Further, the Committee shall make all
    other determinations that may be necessary or advisable for the
    administration of the Plan. As permitted by law and the terms
    and provisions of the Plan, the Committee may delegate its
    authority as identified in this Section 12.2.




    

    XII-1








 






    The actions of the Committee in exercising all of the rights,
    powers, and authorities set out in this Article XII and all
    other Articles of the Plan, when performed in good faith and in
    its sole judgment, shall be final, conclusive and binding on all
    persons. The Committee may employ attorneys, consultants,
    accountants, agents, and other persons, any of whom may be an
    Employee, and the Committee, the Company, and its officers and
    Board shall be entitled to rely upon the advice, opinions, or
    valuations of any such persons.



 



    12.3 Decisions Binding.  All
    determinations and decisions made by the Committee and the Board
    pursuant to the provisions of the Plan and all related orders
    and resolutions of the Committee and the Board shall be final,
    conclusive and binding on all persons, including the Company,
    its stockholders, Employees, Holders and the estates and
    beneficiaries of Employees and Holders.



 



    12.4 No Liability.  Under no circumstances
    shall the Company, the Board or the Committee incur liability
    for any indirect, incidental, consequential or special damages
    (including lost profits) of any form incurred by any person,
    whether or not foreseeable and regardless of the form of the act
    in which such a claim may be brought, with respect to the Plan
    or the Company’s or the Committee’s or the
    Board’s roles in connection with the Plan.




    

    XII-2








 







    ARTICLE XIII
    



 




    AMENDMENT OR
    TERMINATION OF PLAN
    



 



    13.1 Amendment, Modification, Suspension, and
    Termination.  Subject to Section 13.2 the
    Committee may, at any time and from time to time, alter, amend,
    modify, suspend, or terminate the Plan and any Award Agreement
    in whole or in part; provided, however, that, without the prior
    approval of the Company’s stockholders and except as
    provided in Section 4.6, the Committee shall not directly
    or indirectly lower the Option Price of a previously granted
    Option or the grant price of a previously granted SAR issued
    under the Plan, and no amendment of the Plan shall be made
    without stockholder approval if stockholder approval is required
    by applicable law or stock exchange rules.



 



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




    

    XIII-1








 







    ARTICLE XIV
    



 




    MISCELLANEOUS
    



 



    14.1 Unfunded Plan/No Establishment of a
    Trust Fund.  Holders shall have no right,
    title, or interest whatsoever in or to any investments that the
    Company or any of its Affiliates may make to aid in meeting
    obligations under the Plan. Nothing contained in the Plan, and
    no action taken pursuant to its provisions, shall create or be
    construed to create a trust of any kind, or a fiduciary
    relationship between the Company and any Holder, beneficiary,
    legal representative, or any other person. To the extent that
    any person acquires a right to receive payments from the Company
    under the Plan, such right shall be no greater than the right of
    an unsecured general creditor of the Company. All payments to be
    made hereunder shall be paid from the general funds of the
    Company and no special or separate fund shall be established and
    no segregation of assets shall be made to assure payment of such
    amounts, except as expressly set forth in the Plan. No property
    shall be set aside nor shall a trust fund of any kind be
    established to secure the rights of any Holder under the Plan.
    All Holders shall at all times rely solely upon the general
    credit of the Company for the payment of any benefit which
    becomes payable under the Plan. The Plan is not intended to be
    subject to the Employee Retirement Income Security Act of 1974,
    as amended.



 



    14.2 No Employment Obligation.  The
    granting of any Award shall not constitute an employment
    contract, express or implied, nor impose upon the Company or any
    Affiliate any obligation to employ or continue to employ, or
    utilize the services of, any Holder. The right of the Company or
    any Affiliate to terminate the employment of, or provision of
    services by, any person shall not be diminished or affected by
    reason of the fact that an Award has been granted to him, and
    nothing in the Plan or an Award Agreement shall interfere with
    or limit in any way the right of the Company or its Affiliates
    to terminate any Holder’s employment or provision of
    service to the Company at any time or for any reason not
    prohibited by law.



 



    14.3 Tax Withholding.  The Company or any
    Affiliate shall be entitled to deduct from other compensation
    payable to each Holder any sums required by federal, state or
    local tax law to be withheld with respect to the vesting or
    exercise of an Award or lapse of restrictions on an Award. In
    the alternative, the Company may require the Holder (or other
    person validly exercising the Award) to pay such sums for taxes
    directly to the Company or any Affiliate in cash or by check
    within ten days after the date of vesting, exercise or lapse of
    restrictions. In the discretion of the Committee, and with the
    consent of the Holder, the Company may reduce the number of
    shares of Stock issued to the Holder upon such Holder’s
    exercise of an Option to satisfy the tax withholding obligations
    of the Company or an Affiliate; provided that the Fair Market
    Value of the shares of Stock held back shall not exceed the
    Company’s or the Affiliate’s Minimum Statutory
    Withholding Tax Obligations. The Committee may, in its
    discretion, permit a Holder to satisfy any Minimum Statutory
    Withholding Tax Obligations arising upon the vesting of Award by
    delivering to the Holder of the Award a reduced number of shares
    of Stock in the manner specified herein. If permitted by the
    Committee and acceptable to the Holder, at the time of vesting
    of shares of under the Award, the Company shall
    (a) calculate the amount of the Company’s or an
    Affiliate’s Minimum Statutory Withholding Tax Obligations
    on the assumption that all such shares of Stock vested under the
    Award are made available for delivery, (b) reduce the
    number of such shares of Stock made available for delivery so
    that the Fair Market Value of the shares of Stock withheld on
    the vesting date approximates the Company’s or an Affiliate
    Minimum Statutory Withholding Tax Obligation and (c) in
    lieu of the withheld shares of Stock, remit cash to the United
    States Treasury
    and/or other
    applicable governmental authorities, on behalf of the Holder, in
    the amount of the Minimum Statutory Withholding Tax Obligations
    due. The Company shall withhold only whole shares of Stock to
    satisfy its Minimum Statutory Withholding Tax Obligations. Where
    the Fair Market Value of the withheld shares of Stock does not
    equal the amount of the Minimum Statutory Withholding Tax
    Obligations, the Company shall withhold shares of Stock with a
    Fair Market Value slightly less than the amount of its Minimum
    Statutory Withholding Tax Obligation and the Holder must satisfy
    the remaining Minimum Statutory Withholding Tax Obligation in
    some other manner permitted under this Section 14.3. The
    withheld shares of Stock not made available for delivery by the
    Company shall be retained as treasury shares or will be
    cancelled and, in either case, the Holder’s right, title
    and interest in such shares of Stock shall terminate. The
    Company shall have no obligation upon vesting or exercise of any
    Award or lapse of restrictions on an Award until the Company or
    an Affiliate has received payment sufficient to cover the
    Minimum Statutory Withholding Tax Obligation with respect to
    that vesting, exercise or lapse of restrictions. Neither the
    Company nor any Affiliate shall be obligated to advise a Holder
    of the existence of the tax or the amount which it will be
    required to withhold.




    

    XIV-1








 






    14.4 Written Agreement.  Each Award shall
    be embodied in a written agreement or statement which shall be
    subject to the terms and conditions of the Plan. The Award
    Agreement shall be signed by a member of the Committee on behalf
    of the Committee and the Company or by an executive officer of
    the Company, other than the Holder, on behalf of the Company,
    and may be signed by the Holder to the extent required by the
    Committee. The Award Agreement may contain any other provisions
    that the Committee in its discretion shall deem advisable which
    are not inconsistent with the terms and provisions of the Plan.



 



    14.5 Indemnification of the
    Committee.  The Company shall indemnify each
    present and future member of the Committee against, and each
    member of the Committee shall be entitled without further action
    on his or her part to indemnity from the Company for, all
    expenses (including attorney’s fees, the amount of
    judgments and the amount of approved settlements made with a
    view to the curtailment of costs of litigation, other than
    amounts paid to the Company itself) reasonably incurred by such
    member in connection with or arising out of any action, suit or
    proceeding in which such member may be involved by reason of
    such member being or having been a member of the Committee,
    whether or not he or she continues to be a member of the
    Committee at the time of incurring the expenses, including,
    without limitation, matters as to which such member shall be
    finally adjudged in any action, suit or proceeding to have been
    negligent in the performance of such member’s duty as a
    member of the Committee. However, this indemnity shall not
    include any expenses incurred by any member of the Committee in
    respect of matters as to which such member shall be finally
    adjudged in any action, suit or proceeding to have been guilty
    of gross negligence or willful misconduct in the performance of
    his duty as a member of the Committee. In addition, no right of
    indemnification under the Plan shall be available to or
    enforceable by any member of the Committee unless, within
    60 days after institution of any action, suit or
    proceeding, such member shall have offered the Company, in
    writing, the opportunity to handle and defend same at its own
    expense. This right of indemnification shall inure to the
    benefit of the heirs, executors or administrators of each member
    of the Committee and shall be in addition to all other rights to
    which a member of the Committee may be entitled as a matter of
    law, contract or otherwise.



 



    14.6 Gender and Number.  If the context
    requires, words of one gender when used in the Plan shall
    include the other and words used in the singular or plural shall
    include the other.



 



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



 



    14.8 Headings.  Headings of Articles and
    Sections are included for convenience of reference only and do
    not constitute part of the Plan and shall not be used in
    construing the terms and provisions of the Plan.



 



    14.9 Other Compensation Plans.  The
    adoption of the Plan shall not affect any other option,
    incentive or other compensation or benefit plans in effect for
    the Company or any Affiliate, nor shall the Plan preclude the
    Company from establishing any other forms of incentive
    compensation arrangements for Employees.



 



    14.10 Other Awards.  The grant of an Award
    shall not confer upon the Holder the right to receive any future
    or other Awards under the Plan, whether or not Awards may be
    granted to similarly situated Holders, or the right to receive
    future Awards upon the same terms or conditions as previously
    granted.



 



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



 



    14.12 Law Limitations/Governmental
    Approvals.  The granting of Awards and the
    issuance of shares of Stock under the Plan shall be subject to
    all applicable laws, rules, and regulations, and to such
    approvals by any governmental agencies or national securities
    exchanges as may be required.



 



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



 



    (a) obtaining any approvals from governmental agencies that
    the Company determines are necessary or advisable; and




    

    XIV-2








 






    (b) completion of any registration or other qualification
    of the Stock under any applicable national or foreign law or
    ruling of any governmental body that the Company determines to
    be necessary or advisable.



 



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



 



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



 



    14.16 Persons Residing Outside of the United
    States.  Notwithstanding any provision of the Plan
    to the contrary, in order to comply with the laws in other
    countries in which the TMW Group operates or has Employees, the
    Committee, in its sole discretion, shall have the power and
    authority to:



 



    (a) determine which Affiliates shall be covered by the Plan;



 



    (b) determine which persons employed outside the United
    States are eligible to participate in the Plan;



 



    (c) amend or vary the terms and provisions of the Plan and
    the terms and conditions of any Award granted to persons who
    reside outside the United States;



 



    (d) establish subplans and modify exercise procedures and
    other terms and procedures to the extent such actions may be
    necessary or advisable — any subplans and
    modifications to Plan terms and procedures established under
    this Section 14.16 by the Committee shall be attached to
    the Plan document as Appendices; and



 



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



 



    Notwithstanding the above, the Committee may not take any
    actions hereunder, and no Awards shall be granted, that would
    violate the Exchange Act, the Code, any securities law or
    governing statute or any other applicable law.



 



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



 



    14.18 Arbitration of Disputes.  Any
    controversy arising out of or relating to the Plan or an Option
    Agreement shall be resolved by arbitration conducted pursuant to
    the arbitration rules of the American Arbitration Association.
    The arbitration shall be final and binding on the parties.



 



    14.19 Governing Law.  The provisions of
    the Plan and the rights of all persons claiming thereunder shall
    be construed, administered and governed under the laws of the
    State of Texas.




    

    XIV-3