Exhibit 10.1**ASSET ACCEPTANCE CAPITAL CORP.****2004 STOCK INCENTIVE PLAN**(as amended and restated effective January 1, 2008)**I. GENERAL PROVISIONS**     **1.1****Establishment****.**On February 2, 2004, the Board of Directors (“Board”) ofAsset Acceptance Capital Corp., a Delaware corporation (“Company”), adopted the 2004Stock Incentive Plan (“Plan”). On February 2, 2004, the Company’s shareholdersapproved the Plan. On April 2, 2007, the Board amended and restated the Plan, and separately onApril 2, 2007 the Board amended and restated the Plan to provide as set forth herein, with thechanges made through this restatement being (i) effective only on their receipt of shareholderapproval at the Company’s annual meeting in 2007, and (ii) applicable to all outstanding andfuture awards of Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units,Deferred Stock Units, Performance Share Awards, or Annual Incentive Awards. On May 22, 2007 thisamended and restated Plan was approved by shareholders at the Company’s 2007 annual meeting ofshareholders. As of January 1, 2008, the Plan was further amended and restated to comply withInternal Revenue Code Section 409A.     **1.2****Purpose****.**The purpose of the Plan is (i) to promote the best interests of theCompany and its shareholders by encouraging Employees, consultants and non-employee directorsof the Company and its Subsidiaries to acquire an ownership interest in the Company throughOptions, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Deferred Stock Units,Performance Share Awards and Annual Incentive Awards, thus identifying their interests with thoseof shareholders, and (ii) to enhance the ability of the Company to attract and retain qualifiedEmployees, consultants and non-employee directors. It is the further purpose of the Plan to permitthe granting of Nonqualified Stock Options, Stock Appreciation Rights, Restricted Stock, RestrictedStock Units, Deferred Stock Units, Performance Share Awards and Annual Incentive Awards that willconstitute performance based compensation, as described in Section 162(m) of the Code, andregulations promulgated thereunder.     **1.3****Definitions****.**As used in this Plan, the following terms have the meaning describedbelow:          (a) “Agreement” means the written agreement that sets forth the terms of aParticipant’s Option, Stock Appreciation Right, Restricted Stock grant, Restricted Stock Units,Deferred Stock Units, Performance Share Award, Annual Incentive Award, or Deferred Stock Unit awardwithin the meaning of Section 4.10 of the Plan.

 
          (b) “Annual Incentive Award” means an award that is granted in accordance withArticle VI of the Plan.          (c) “Board” means the Board of Directors of the Company.          (d) “Change in Control” means the occurrence of any of the following events: (i) theacquisition of ownership by a person, corporation or other entity, or a group acting in concert, offifty-one percent, or more, of the outstanding Common Stock of the Company in a singletransaction or a series of related transactions within a one-year period; (ii) a sale of all orsubstantially all of the assets of the Company to any person, corporation or other entity;(iii) a merger or similar transaction between the Company and another entity if shareholders ofthe Company do not own a majority of the voting stock of the surviving entity or any parentthereof and a majority in value of the total outstanding stock of such surviving entity or anyparent thereof; or (iv) during any consecutive two-year period commencing after the date ofadoption of this Plan, individuals who constituted the Board at the beginning of the period (ortheir approved replacements, as defined herein) cease for any reason to constitute a majority ofthe Board, with a new Director being considered an “approved replacement” Director if his or herelection (or nomination for election) was approved by a vote of at least a majority of theDirectors then still in office who either were Directors at the beginning of the period or werethemselves approved replacement Directors, but in either case excluding any Director whose initialassumption of office occurred as a result of an actual or threatened solicitation of proxies orconsents by or on behalf of any person other than the Board. Provided, however, that there shallnot be included within the meaning of “Change in Control,” any such event involving: (a) anyemployee benefit plan (or related trust) sponsored or maintained by the Company; or (b) any ofthe current shareholders of the Company as of the date of adoption of this Plan by the Board(or any entity at any time controlled by any such shareholder or shareholders).          (e) “Change in Position” means, as determined by the Committee in its discretion withrespect to any Participant, a significant change in such Participant’s employment relationship withthe Company, including but not limited to any or all of the following: (i) such Participant’sinvoluntary termination of employment or services; (ii) a significant reduction in suchParticipant’s duties, responsibilities, compensation and/or fringe benefits, or the assignment tosuch Participant of duties inconsistent with his or her position (all as in effect immediatelyprior to a Change in Control), whether or not such Participant voluntarily terminates employment orservices as a result thereof; or (iii) a significant change in the geographic location of theParticipant’s primary workplace.          (f) “Code” means the Internal Revenue Code of 1986, as amended.          (g) “Committee” means the Compensation Committee of the Company, which shall becomprised of two or more members of the Board.          (h) “Common Stock” means shares of the Company’s authorized common stock.          (i) “Company” means Asset Acceptance Capital Corp. a Delaware corporation.
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          (j) “Continuous Service” means the absence of any interruption or termination ofservice as an Employee, non-employee director, or consultant.Continuous Service shall not be considered interrupted in the case of: (i) sick leave; (ii) militaryleave; (iii) any other leave of absence approved by the Committee, provided that such leave is fora period of not more than 90 days, unless reemployment upon the expiration of such leave isguaranteed by contract or statute, or unless provided otherwise pursuant to Company policyadopted from time to time; (iv) changes in status from director to advisory director or emeritusstatus; or (v) in the case of transfers between locations of the Company or between theCompany or its respective successors. Changes in status between service as an Employee,director, and a consultant shall not constitute an interruption ofContinuous Service.          (k) “Deferred Stock Unit” means Common Stock that is subject to future delivery inaccordance with Section 4.10 of the Plan.          (l) “Disability” means total and permanent disability, as defined in Code Section22(e).          (m) “Employee” means an individual who has an “employment relationship” with theCompany or a Subsidiary, as defined in Treasury Regulation 1.421-7(h), and the term“employment” means employment with the Company, or a Subsidiary of the Company.          (n) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time totime and any successor thereto.          (o) “Fair Market Value” means for purposes of determining the value of Common Stock onthe Grant Date the Stock Exchange closing price of the Company’s Common Stock as reported inThe Wall Street Journal (or as otherwise reported by such Stock Exchange) for the GrantDate. In the event that there were no Common Stock transactions on such date, the Fair MarketValue shall be determined as of the immediately preceding date on which there were Common Stocktransactions. Unless otherwise specified in the Plan, “Fair Market Value” for purposes ofdetermining the value of Common Stock on the date of exercise means the Stock Exchange closingprice of the Company’s Common Stock on the last date preceding the exercise on which there wereCommon Stock transactions.          (p) “Grant Date” means the date on which the Committee authorizes an individualOption, Stock Appreciation Right, Restricted Stock grant, Restricted Stock Units, Deferred StockUnits, Performance Share Award or Annual Incentive Award, or such later date as shall be designatedby the Committee.          (q) “Incentive Stock Option” means an Option that is intended to meet the requirementsof Section 422 of the Code.          (r) “Nonqualified Stock Option” means an Option that is not intended to constitute anIncentive Stock Option.          (s) “Option” means either an Incentive Stock Option or a Nonqualified Stock Option.
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          (t) “Participant” means an Employee or non-employee director or consultant designatedby the Committee to participate in the Plan.          (u) “Performance Share Award” means a performance share award that is granted inaccordance with Article V of the plan.          (v) “Plan” means the Asset Acceptance Capital Corp. 2004 Stock Incentive Plan, theterms of which are set forth herein, and amendments thereto.          (w) “Restriction Period” means the period of time during which a Participant’sRestricted Stock or Restricted Stock Unit grant is subject to restrictions and is nontransferable.          (x) “Restricted Stock” means Common Stock that is subject to restrictions.          (y) “Restricted Stock Unit” means a right granted pursuant to Article IV to receiveRestricted Stock or an equivalent value in cash pursuant to the terms of the Plan and the relatedAgreement.          (z) “Retirement” means termination of employment on or after the attainment of age 65and completion of three (3) years of service with the Company.          (aa) “Stock Appreciation Right” means the right to receive a cash or Common Stockpayment from the Company, in accordance with Article III of the Plan.          (bb) “Stock Exchange” means the principal national securities exchange on which theCommon Stock is listed for trading or, if the Common Stock is not listed for trading on a nationalsecurities exchange, such other recognized trading market or quotation system upon which thelargest number of shares of Common Stock has been traded in the aggregate during the last 20 daysbefore a Grant Date or date on which an Option is exercised, whichever is applicable.          (cc) “Subsidiary” means a corporation or other entity defined in Code Section 424(f).          (dd) “Vested” means the extent to which an Option or Stock Appreciation Right grantedhereunder has become exercisable in accordance with this Plan and the terms of the respectiveAgreement pursuant to which such Option or Stock Appreciation Right was granted.     **1.4****Administration****.**          (a) The Plan shall be administered by the Committee. At all times it is intended that thedirectors appointed to serve on the Committee shall be “disinterested persons” (within the meaningof Rule 16b-3 promulgated under the Exchange Act) and “outside directors” (within the meaning ofCode Section 162(m)); however, the mere fact that a Committee member shall fail to qualify undereither of these requirements shall not invalidate any award made by the Committee if the award isotherwise validly made under the Plan. The members of the
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Committee shall be appointed by, and may be changed at any time and from time to time, at thediscretion of the Board.          (b) The Committee shall interpret the Plan, prescribe, amend, and rescind rules andregulations relating to the Plan, and make all other determinations necessary or advisable for itsadministration. Subject to applicable law and the restrictions set forth in the Plan, theCommittee may delegate administrative functions to officers and Employees of the Company or itsSubsidiaries, and may delegate in writing to one or more executives the authority, which shall berevocable in writing at any time by the Committee, to make grants to non-executive Employees.          (c) The Committee shall have the discretion to interpret or construe ambiguous, unclear, orimplied (but omitted) terms in any fashion it deems to be appropriate in its sole discretion, andto make any findings of fact needed in the administration of the Plan or Agreements. TheCommittee’s prior exercise of its discretionary authority shall not obligate it to exercise itsauthority in a like fashion thereafter. The decision of the Committee on any question concerningthe interpretation of the Plan or its administration with respect to any Option, Stock AppreciationRight, Restricted Stock grant, Restricted Stock Units, Deferred Stock Units, Performance ShareAward or Annual Incentive Award granted under the Plan shall be final and binding upon allParticipants and their beneficiaries, transferees, successors, and assigns. No member of theCommittee shall be liable for any action or determination made in good faith with respect to thePlan or any grant or award hereunder.     **1.5****Participants****.**Participants in the Plan shall be such Employees (includingEmployees who are directors), non-employee directors of, or consultants to, the Company and itsSubsidiaries as the Committee in its sole discretion may select from time to time. The Committeemay grant Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, DeferredStock Units, Performance Share Awards and Annual Incentive Awards to an individual upon thecondition that the individual become an Employee of the Company or of a Subsidiary, providedthat the Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Units, Deferred StockUnits, Performance Share Award or Annual Incentive Award shall be deemed to be granted only on thedate that the individual becomes an Employee.     **1.6****Stock****.**The Company has reserved 3,700,000 shares of the Company’s CommonStock for issuance in conjunction with all Options and other stock-based awards to be granted underthe Plan. Shares subject to any unexercised portion of a terminated, cancelled or expired Option,Stock Appreciation Right, Restricted Stock grant, Restricted Stock Units, Deferred Stock Units, orPerformance Share Award granted hereunder, and pursuant to which a Participant never acquiredbenefits of ownership, including payment of a stock dividend (but excluding voting rights), mayagain be subjected to grants and awards under the Plan, but shares surrendered pursuant to theexercise of a Stock Appreciation Right shall not be available for future grants and awards.Notwithstanding the foregoing, the number of Shares that are available for Incentive Stock Optionawards shall be determined, to the extent required under applicable tax laws, by reducing thenumber of shares designated in the preceding paragraph by the number of Shares granted pursuant toall awards (whether or not shares are issued pursuant to such awards), provided that any sharesthat are either issued or purchased under the Plan and forfeited back to the Plan, or surrenderedin payment of the exercise price for an Option or Stock
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Appreciation Right shall be available for issuance pursuant to future Incentive Stock Optionawards. All provisions in this Section 1.6 shall be adjusted, as applicable, in accordancewith Article VIII.**II. STOCK OPTIONS**     **2.1****Grant of Options****.**The Committee, at any time and from time to time, subject tothe terms and conditions of the Plan, may grant Options to such Participants and for such number ofshares of Common Stock (whole or fractional) as it shall designate; provided, however, that noParticipant may be granted Options during any one fiscal year (when aggregated with all otherstock-based awards granted under the Plan during such fiscal year), to purchase more than 500,000shares of Common Stock (subject to adjustment in accordance with Section 8.1(a) below). AnyParticipant may hold more than one Option under the Plan and any other Plan of the Company orSubsidiary. The Committee shall determine the general terms and conditions of exercise, includingany applicable vesting requirements, which shall be set forth in a Participant’s Option Agreement.No Option granted hereunder may be exercised after the tenth anniversary of the Grant Date. TheCommittee may designate any Option granted as either an Incentive Stock Option or a NonqualifiedStock Option, or the Committee may designate a portion of an Option as an Incentive Stock Option ora Nonqualified Stock Option. An Incentive Stock Option may only be granted to an Employee. At thediscretion of the Committee, an Option may be granted in tandem with a Stock Appreciation Right.Nonqualified Stock Options are intended to satisfy the requirements of Code Section 162(m) and theregulations promulgated thereunder, to the extent applicable.     **2.2****Incentive Stock Options****.**Any Option intended to constitute an Incentive StockOption shall comply with the requirements of this Section 2.2. No Incentive Stock Optionshall be granted with an exercise price below the Fair Market Value of Common Stock on the GrantDate nor with an exercise term that extends beyond 10 years from the Grant Date. An IncentiveStock Option shall not be granted to any Participant who owns (within the meaning of Code Section424(d)) stock of the Company or any Subsidiary possessing more than 10% of the total combinedvoting power of all classes of stock of the Company or a Subsidiary unless, at the Grant Date,the exercise price for the Option is at least 110% of the Fair Market Value of the shares subjectto the Option and the Option, by its terms, is not exercisable more than 5 years after the GrantDate. The aggregate Fair Market Value of the underlying Common Stock (determined at the GrantDate) as to which Incentive Stock Options granted under the Plan (including a plan of a Subsidiary)may first be exercised by a Participant in any one calendar year shall not exceed $100,000. To theextent that an Option intended to constitute an Incentive Stock Option shall violate the foregoing$100,000 limitation (or any other limitation set forth in Code Section 422), the portion of theOption that exceeds the $100,000 limitation (or violates any other Code Section 422 limitation)shall be deemed to constitute a Nonqualified Stock Option.     **2.3****Option Price****.**The Committee shall determine the per share exercise price for eachOption granted under the Plan. The Committee, at its discretion, may grant Nonqualified StockOptions with an exercise price below 100% of the Fair Market Value of Common Stock on the GrantDate. The foregoing notwithstanding, no Incentive Stock Option shall be granted with an exerciseprice below the Fair Market Value of Common Stock on the Grant Date.
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     **2.4****Payment for Option Shares****.**          (a) The purchase price for shares of Common Stock to be acquired upon exercise of an Optiongranted hereunder shall be paid in full in cash or by personal check, bank draft or money order atthe time of exercise; provided, however, that in lieu of such form of payment and to the extentauthorized in an Agreement, a Participant may pay such purchase price in whole or in part bytendering shares of Common Stock, which are either (i) subject to the Option being exercised or(ii) have been held by the Participant for at least six (6) months and which are freely owned andheld by the Participant independent of any restrictions, hypothecations or other encumbrances, dulyendorsed for transfer (or with duly executed stock powers attached), or in any combination of theabove. Shares of Common Stock surrendered upon exercise shall be valued at the Stock Exchangeclosing price for the Company’s Common Stock on the day prior to exercise, as reported inThe Wall Street Journal (or as otherwise reported by such Stock Exchange), and thecertificate(s) for such shares, duly endorsed for transfer or accompanied by appropriate stockpowers, shall be surrendered to the Company. Participants who are subject to short swingprofit restrictions under the Exchange Act and who exercise an Option by tenderingpreviously-acquired shares shall do so only in accordance with the provisions of Rule 16b-3 of theExchange Act.          (b) At the discretion of the Committee, as set forth in a Participant’s Option Agreement, anyOption granted hereunder may be deemed exercised by delivery to the Company of a properlyexecuted exercise notice, acceptable to the Company, together with irrevocable instructions tothe Participant’s broker to deliver to the Company sufficient cash to pay the exercise priceand any applicable income and employment withholding taxes, in accordance with a written agreementbetween the Company and the brokerage firm (“cashless exercise procedure”).**III. STOCK APPRECIATION RIGHTS**     **3.1****Grant of Stock Appreciation Rights****.**Stock Appreciation Rights may be granted,held and exercised in such form and upon such general terms and conditions as determined by theCommittee on an individual basis. A Stock Appreciation Right may be granted to a Participant withrespect to such number of shares of Common Stock of the Company as the Committee may determine;provided, however, that no Participant may be granted a Stock Appreciation Right during any onefiscal year (when aggregated with all other stock-based awards granted under the Plan during suchfiscal year), for more than 500,000 shares of Common Stock (subject to adjustment in accordancewith Section 8.1(a) below). A Stock Appreciation Right may be granted on a stand-alone basis or intandem with an Option. If granted in tandem with an Option, the number of shares covered by theStock Appreciation Right shall not exceed the number of shares of stock which the Participant couldpurchase upon the exercise of the related Option. Stock Appreciation Rights are intended tosatisfy the requirements of Code Section 162(m) and the regulations promulgated thereunder, to theextent applicable.
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     **3.2****Exercise of Stock Appreciation Rights****.**A Stock Appreciation Right shall be deemedexercised upon receipt by the Company of written notice of exercise from the Participant.Except as permitted under Rule 16b-3, notice of exercise of a Stock Appreciation Right by aParticipant subject to the insider trading restrictions of Section 16(b) of the Securities ExchangeAct of 1934, shall be limited to the period beginning on the third day following the release of theCompany’s quarterly or annual summary of earnings and ending on the 12th business day aftersuch release. The exercise term of each Stock Appreciation Right shall be limited to 10 years fromits Grant Date or such earlier period as set by the Committee or in a related Option. If grantedin tandem with an Option, a Stock Appreciation Right shall be exercisable only at such times and insuch amounts as the related Option may be exercised. A Stock Appreciation Right granted to aParticipant subject to the insider trading restrictions shall not be exercisable in whole or partduring the first six months of its term, unless the Participant dies or becomes disabled duringsuch six-month period.     **3.3****Stock Appreciation Right Entitlement****.**          (a) Upon exercise of a Stock Appreciation Right, a Participant shall be entitled to paymentfrom the Company, in cash, shares, or partly in each (as determined by the Committee inaccordance with any applicable terms of the Agreement), of an amount equal to the differencebetween the aggregate Fair Market Value on the date of exercise for the specified number of sharesbeing exercised and the aggregate exercise price of the Stock Appreciation Right being exercised.If the Stock Appreciation Right is granted in tandem with an Option, the payment shall be equal tothe difference between:          (i) the Fair Market Value of the number of shares subject to the Stock AppreciationRight on the exercise date; and          (ii) the Option price of the associated Option multiplied by the number of sharesavailable under the Option.          (b) Notwithstanding Section 3.3(a), upon exercise of a Stock Appreciation Right theParticipant shall be required to surrender any associated Option.     **3.4****Maximum Stock Appreciation Right Amount Per Share****.**The Committee may, at its solediscretion, establish (at the time of grant) a maximum amount per share which shall be payable uponthe exercise of a Stock Appreciation Right, expressed as a dollar amount or as a percentage ormultiple of the Option price of a related Option.**IV. RESTRICTED STOCK GRANTS AND UNITS**     **4.1****Grant of Restricted Stock and Restricted Stock Units****.**Subject to the terms andconditions of the Plan, the Committee, at any time and from time to time, may grant shares ofRestricted Stock and Restricted Stock Units under this Plan to such Participants and in suchamounts as it shall determine; provided, however, that no Participant may be granted a RestrictedStock Award or Restricted Stock Units during any one fiscal year (when aggregated with all otherstock-based awards granted under the Plan during such fiscal year), for more than 500,000 shares ofCommon Stock (subject to adjustment in accordance with Section 8.1(a) below).
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     **4.2****Restricted Stock Agreement****.**Each grant of Restricted Stock or Restricted StockUnits shall be evidenced by an Agreement that shall specify the terms of the restrictions,including the Restriction Period, or periods, the number of Common Stock shares subject to thegrant or units, and such other general terms and conditions, including performance goals, as theCommittee shall determine in its discretion; subject to the Committee’s discretion to make awardshaving no restrictions or Restricted Period.     **4.3****Transferability****.**Except as provided in this Article IV or Section9.4 of the Plan, the shares of Common Stock subject to a Restricted Stock grant or RestrictedStock Unit hereunder may not be transferred, pledged, assigned, or otherwise alienated orhypothecated until the termination of the applicable Restriction Period or for such period of timeas shall be established by the Committee and as shall be specified in the applicable Agreement, orupon the earlier satisfaction of other conditions as specified by the Committee in its solediscretion and as set forth in the applicable Agreement.     **4.4****Other Restrictions****.**The Committee shall impose such other restrictions on anyshares of Common Stock subject to a Restricted Stock grant or Restricted Stock Unit under the Planas it may deem advisable including, without limitation, restrictions under applicable Federal orState securities laws, and may legend the certificates representing such shares to give appropriatenotice of such restrictions.     **4.5****Certificate Legend****.**In addition to any legends placed on certificates pursuant toSections 4.3 and 4.4, each certificate representing shares of Common Stock subject torestrictions under a Restricted Stock grant or Restricted Stock Unit shall bear the followinglegend:     The sale or other transfer of the shares of stock represented by thiscertificate, whether voluntary, involuntary or by operation of law, is subject tocertain restrictions on transfer set forth in the Asset Acceptance Capital Corp.2004 Stock Incentive Plan (“Plan”), rules and administrative guidelines adoptedpursuant to such Plan and an Agreement dated                     . Acopy of the Plan, such rules and such Agreement may be obtained from the Secretaryof Asset Acceptance Capital Corp.     **4.6****Removal of Restrictions****.**Except as otherwise provided in this Article IVof the Plan, and subject to applicable federal and state securities laws, shares of Common Stocksubject to a Restricted Stock grant or Restricted Stock Unit under the Plan shall become freelytransferable by the Participant after the last day of the Restriction Period. Once the shares arereleased from the restrictions, the Participant shall be entitled to have the legend required bySection 4.5 of the Plan removed from the applicable Common Stock certificate. Providedfurther, the Committee shall have the discretion to waive the applicable Restriction Period withrespect to all or any part of the Common Stock subject to a Restricted Stock grant or RestrictedStock Unit.     **4.7****Voting Rights****.**During the Restriction Period, Participants holding shares ofCommon Stock subject to a Restricted Stock grant hereunder may exercise full voting rights withrespect to the Restricted Stock.
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     **4.8****Dividends and Other Distributions****.**Unless otherwise provided in an Agreement,during the Restriction Period, a Participant shall be entitled to receive all dividends and otherdistributions paid with respect to shares of Common Stock subject to a Restricted Stock grant orRestricted Stock Unit. If any dividends or distributions are paid in shares of Common Stock duringthe Restriction Period, the dividend or other distribution shares shall be subject to the samerestrictions on transferability as the shares of Common Stock with respect to which they were paid(unless an Agreement provides otherwise).     **4.9****Restricted Stock Grants and Units Under Code Section 162(m****).**The Committee, atits discretion, may designate certain Restricted Stock grants or Restricted Stock Units as beinggranted pursuant to Code Section 162(m). Such Restricted Stock and Restricted Stock Units mustcomply with the following additional requirements, which override any other provision set forth inthis Article IV:          (a) Each Code Section 162(m) Restricted Stock Award or Restricted Stock Unit shall be basedupon pre-established, objective performance goals that are intended to satisfy theperformance-based compensation requirements of Code Section 162(m) and the regulations promulgatedthereunder. Further, at the discretion of the Committee, a Restricted Stock Award or RestrictedStock Unit also may be subject to goals and restrictions in addition to the performancerequirements.          (b) Each Code Section 162(m) Restricted Stock Award or Restricted Stock Unit shall be basedupon the attainment of specified levels of Company or Subsidiary performance during a specifiedperformance period, as measured by any or all of the following: earnings (as measured by netincome, net income per share, operating income, operating income per share, or earnings beforeinterest, taxes, depreciation and amortization [“EBITDA”]), revenue growth, market capitalization,and price per share.          (c) For each designated performance period, the Committee shall (i) select those Employees whoshall be eligible to receive a Restricted Stock Award or Restricted Stock Unit, (ii) determine theperformance period, which may be a one to five fiscal year period, (iii) determine the targetlevels of Company or Subsidiary performance, and (iv) determine the number of shares subject toa Restricted Stock Award or Restricted Stock Unit to be paid to each selected Employee. TheCommittee shall make the foregoing determinations prior to the commencement of services to which aRestricted Stock Award or Restricted Stock Unit relates (or within the permissible time-periodestablished under Code Section 162(m)) and while the outcome of the performance goals and targetsis uncertain.          (d) For each performance period, the Committee shall certify, in writing: (i) if theCompany has attained the performance targets, and (ii) the number of shares pursuant to theRestricted Stock Award or Restricted Stock Unit that are to become freely transferable. TheCommittee shall have no discretion to waive all or part of the conditions, goals and restrictionsapplicable to the receipt of full or partial payment of a Restricted Stock Award or RestrictedStock Unit.          (e) Any dividends paid during the Restriction Period automatically shall be reinvested onbehalf of the Employee in additional shares of Common Stock under the Plan, and
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such additional shares shall be subject to the same performance goals and restrictions as theother shares under the Restricted Stock Award or Restricted Stock Unit. No shares under a CodeSection 162(m) Restricted Stock Award or Restricted Stock Unit shall become transferable until theCommittee certifies in writing that the performance goals and restrictions have been satisfied.          (f) Except as otherwise provided in this Article IV or Section 9.4 of thePlan, and subject to applicable federal and state securities laws, shares covered by eachRestricted Stock Award or Restricted Stock Unit made under the Plan may not be transferred,pledged, assigned, or otherwise alienated or hypothecated until the applicable performance targetsand other restrictions are satisfied, as shall be certified in writing by the Committee. At suchtime, shares covered by the Restricted Stock Award or Restricted Stock Unit shall become freelytransferable by the Employee. Once the shares are released from the restrictions, the Employeeshall be entitled to have the legend required by Section 4.5 of the Plan removed from theapplicable Common Stock certificate.     **4.10****Deferred Stock Units****.**     ***(a) ****Elections to Defer*. The Committee may permit any Participant who is a director,consultant or member of a select group of management or highly compensated Employees (within themeaning of the Code) to irrevocably elect, on a form provided by and acceptable to the Committee(the “Election Form”), forego the receipt of cash or other compensation (including the Sharesdeliverable pursuant to any Award other than Restricted Shares for which a Section 83(b) Electionhas been made), and in lieu thereof to have the Company credit to an internal Plan account (the“Account”) a number of Deferred Stock units (“Deferred Stock Units”) having a Fair Market Valueequal to the Shares and other compensation deferred. These credits will be made at the end of eachcalendar month during which compensation is deferred. Each Election Form shall take effect on thefirst day of the next calendar year (or on the first day of the next calendar month in the case ofan initial election by a Participant who first receives an Award, subject to adjustments by theCommittee in accordance with Code Section 409A) after its delivery to the Company, unless theCompany sends the Participant a written notice explaining why the Election Form is invalidwithin five business days after the Company receives it. Notwithstanding the foregoingsentence: (i) Election Forms shall be ineffective with respect to any compensation that aParticipant earns before the date on which the Company receives the Election Form, and (ii)Election Forms must be submitted to the Committee no later than December 31st of the calendar yearpreceding the calendar year in which the Eligible Person first performs the services that areattributable to the compensation being deferred. Notwithstanding the foregoing, any EligiblePerson who first becomes eligible to defer compensation under the Plan and is not eligible to deferor otherwise accrue an amount of deferred compensation under any other plan or arrangement that (i)is maintained by the Company or any other Affiliate that would be considered a single employerwith the Company pursuant to Code Sections 414(b) or 414(c) and (ii) constitutes a single planunder Treasury Regulation §1.409A-1(c)(2)(A), may submit his or her Election Form to the Committeeno later than 30 days after the date the Eligible Person first becomes eligible to defercompensation under the Plan; however, the Election Form may relate only to compensation that is tobe paid for services performed after the date the Election Form is submitted to the Committee. TheCommittee may reject any Election Form that it determines in its sole discretion does not satisfythe requirements of this paragraph. The Committee may unilaterally
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make awards in the form of Deferred Stock Units, regardless of whether or not the Participantforegoes other compensation.     ***(b) ****Vesting*. Unless an Agreement expressly provides otherwise, each Participant shall be 100%vested at all times in any shares subject to Deferred Stock Units.     ***(c) ****Issuances of Shares*. The Company shall provide a Participant with one share for eachDeferred Stock Unit in five substantially equal annual installments that are issued before the lastday of each of the five calendar years that end after the date on which the Participant’s incurs a“separation form service” within the meaning of Treasury Regulations §1.409A-1(h) (“Separation fromService”), unless —          **(i) **the Participant has properly elected a different form of distribution, on a form approvedby the Committee, that permits the Participant to select any combination of a lump sum and annualinstallments that are triggered by and completed within ten years following the ParticipantSeparation from Service, and          **(ii) **the Company received the Participant’s distribution election form at the time theParticipant elects to defer the receipt of cash or other compensation pursuant to this Section4.10(a), provided that such election may be changed through any subsequent election that (i) isdelivered to the Company at least one year before the date on which distributions are otherwisescheduled to commence pursuant to the Participant’s election, and (ii) defers the commencement ofdistributions by at least five years from the originally scheduled commencement date. Fractionalshares shall not be issued, and instead shall be paid out in cash.     ***(d) ****Crediting of Dividends*. Whenever shares are issued to a Participant pursuant to Section4.10(c) above, such Participant shall also be entitled to receive, with respect to each shareissued, cash dividends or a number of shares equal to the sum of (i) any stock dividends, whichwere declared and paid to the holders of shares between the Grant Date and the date such share isissued, and (ii) a number of shares equal to the shares that the Participant could have purchasedat Fair Market Value on the payment date of any cash dividends for shares if the Participant hadreceived such cash dividends between the Grant Date and the settlement date for the Deferred StockUnits.     ***(e) ****Emergency Withdrawals*. In the event a Participant suffers an unforeseeable emergencywithin the contemplation of this Section and Section 409A of the Code, the Participant may apply tothe Company for an immediate distribution of all or a portion of the Participant’s DeferredStock Units. The unforeseeable emergency must result from a sudden and unexpected illness oraccident of the Participant, the Participant’s spouse, or a dependent (within the meaning ofSection 152(a) of the Code) of the Participant, casualty loss of the Participant’s property, orother similar extraordinary and unforeseeable conditions beyond the control of the Participant.Examples of purposes which are not considered unforeseeable emergencies include post-secondaryschool expenses or the desire to purchase a residence. In no event will a distribution be made tothe extent the unforeseeable emergency could be relieved through reimbursement or compensation byinsurance or otherwise, or by liquidation of the Participant’s nonessential assets to the extentsuch liquidation would not itself cause a severe financial hardship. The amount of anydistribution hereunder shall be limited to the amount necessary to
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relieve the Participant’s unforeseeable emergency plus amounts necessary to pay taxesreasonably anticipated as a result of the distribution. The Committee, in its sole and absolutediscretion, shall determine whether a Participant has a qualifying unforeseeable emergency and theamount which qualifies for distribution, if any. The Committee may require evidence of the purposeand amount of the need, and may establish such application or other procedures as it deemsappropriate.     ***(f) ****Unsecured Rights to Deferred Compensation*. A Participant’s right to Deferred Stock Unitsshall at all times constitute an unsecured promise of the Company to pay benefits as they comedue. The right of the Participant or the Participant’s duly-authorized transferee to receivebenefits hereunder shall be solely an unsecured claim against the general assets of theCompany. Neither the Participant nor the Participant’s duly-authorized transferee shall haveany claim against or rights in any specific assets, shares, or other funds of the Company.**V. PERFORMANCE SHARE AWARDS**     **5.1****Grant of Performance Share Awards****.**The Committee, at its discretion, may grantPerformance Share Awards to Participants and may determine, on an individual or group basis, theperformance goals to be attained pursuant to each Performance Share Award; provided, however, thatno Participant may be granted a Performance Share Award during any one fiscal year (when aggregatedwith all other stock-based awards granted under the Plan during such fiscal year), for more than500,000 shares of Common Stock (subject to adjustment in accordance with Section 8.1(a) below).     **5.2****Terms of Performance Share Awards****.**In general, Performance Share Awards shallconsist of rights to receive cash, Common Stock or a combination of each, if designated performancegoals are achieved. The terms of a Participant’s Performance Share Award shall be set forth in hisindividual Performance Share Agreement. Each Agreement shall specify the performance goalsapplicable to a particular Participant or group of Participants, the period over which the targetedgoals are to be attained, the payment schedule if the goals are attained, and any other generalterms and conditions applicable to an individual Performance Share Award as the Committee shalldetermine. The Committee, at its discretion, may waive all or part of the conditions, goals andrestrictions applicable to the receipt of full or partial payment of a Performance Share Award.     **5.3****Performance Share Awards Granted Under Code Section 162(m****).**The Committee, at itsdiscretion, may designate certain Performance Share Awards as granted pursuant to Code Section162(m). Such Performance Share Awards must comply with the following additional requirements,which override any other provision set forth in this Article V:          (a) The Committee, at its discretion, may grant Code Section 162(m) Performance Share Awardsbased upon pre-established, objective performance goals that are intended to satisfy theperformance-based compensation requirements of Code Section 162(m) and the regulations promulgatedthereunder. Further, at the discretion of the Committee, a Performance Share Award also may besubject to goals and restrictions in addition to the performance requirements.
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          (b) Each Code Section 162(m) Performance Share Award shall be based upon the attainment ofspecified levels of Company or Subsidiary performance during a specified performance period, asmeasured by any or all of the following: earnings (as measured by net income, net income per share,operating income, operating income per share, or earnings before interest, taxes, depreciation andamortization [“EBITDA”]), revenue growth, market capitalization, and price per share.          (c) For each designated performance period, the Committee shall (i) select those Employees whoshall be eligible to receive a Code Section 162(m) Performance Share Award, (ii) determine theperformance period, which may be a one to five fiscal year period, (iii) determine the targetlevels of Company or Subsidiary performance, and (iv) determine the Performance Share Award tobe paid to each selected Employee. The Committee shall make the foregoing determinations prior tothe commencement of services to which a Performance Share Award relates (or within the permissibletime-period established under Code Section 162(m)) and while the outcome of the performance goalsand targets is uncertain.          (d) For each performance period, the Committee shall certify, in writing: (i) if theCompany has attained the performance targets; and (ii) the cash or number of shares (orcombination thereof) pursuant to the Performance Share Award that shall be paid to each selectedEmployee (or the number of shares that are to become freely transferable, if a Performance ShareAward is granted subject to attainment of the designated performance goals). The Committee, maynot waive all or part of the conditions, goals and restrictions applicable to the receipt of fullor partial payment of a Performance Share Award.          (e) Code Section 162(m) Performance Share Awards may be granted in two different forms, at thediscretion of the Committee. Under one form, the Employee shall receive a Performance Share Awardthat consists of a legended certificate of Common Stock, restricted from transfer prior to thesatisfaction of the designated performance goals and restrictions, as determined by the Committeeand specified in the Employee’s Performance Share Agreement. Prior to satisfaction of theperformance goals and restrictions, the Employee shall be entitled to vote the Performance Shares.Further, any dividends paid on such shares during the performance/restriction period automaticallyshall be reinvested on behalf of the Employee in additional Performance Shares under the Plan, andsuch additional shares shall be subject to the same performance goals and restrictions as the othershares under the Performance Share Award. No shares under a Performance Share Award shall becometransferable until the Committee certifies in writing that the performance goals and restrictionshave been satisfied.          (f) Under the second form, the Employee shall receive a Performance Share Agreement from theCommittee that specifies the performance goals and restrictions that must be satisfied before theCompany shall issue the payment, which may be cash, a designated number of shares of CommonStock or a combination of the two. Any certificate for shares under such form of Performance ShareAward shall be issued only after the Committee certifies in writing that the performance goals andrestrictions have been satisfied.          (g) In addition to any legends placed on certificates pursuant to Section 5.3(e), eachcertificate representing shares under a Performance Share Award shall bear the following legend:
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     The sale or other transfer of the shares of stock represented by thiscertificate, whether voluntary, involuntary or by operation of law, is subject tocertain restrictions on transfer set forth in the Asset Acceptance Capital Corp.2004 Stock Incentive Plan (“Plan”), rules and administrative guidelines adoptedpursuant to such Plan and a Performance Share Agreement dated                     . A copy of the Plan, such rules and such Performance ShareAgreementmay be obtained from the Secretary of Asset Acceptance Capital Corp.          (h) Except as otherwise provided in this Article V or Section 9.4 of the Plan,and subject to applicable federal and state securities laws, shares covered by each PerformanceShare Award made under the Plan may not be transferred, pledged, assigned, or otherwise alienatedor hypothecated until the applicable performance targets and other restrictions are satisfied, asshall be certified in writing by the Committee. At such time, shares covered by the PerformanceShare Award shall become freely transferable by the Employee. Once the shares are released fromthe restrictions, the Employee shall be entitled to have the legend required by Section5.3(g) removed from the applicable Common Stock certificate.**VI. ANNUAL INCENTIVE AWARDS**     **6.1****Grant of Annual Incentive Awards****.**          (a) The Committee, at its discretion, may grant Annual Incentive Awards to such Participantsas it may designate from time to time. The terms of a Participant’s Annual Incentive Award shallbe set forth in his individual Annual Incentive Award Agreement. Each Agreement shall specify suchgeneral terms and conditions as the Committee shall determine, as well as the Participant’spre-established, objective performance goals, including those that are intended to satisfy theperformance-based compensation requirements of Code Section 162(m) and the regulations promulgatedthereunder, to the extent applicable.          (b) The determination of Annual Incentive Awards for a given year shall be based upon theattainment of specified levels of Company or Subsidiary performance as measured by suchperformance criteria as are determined at the discretion of the Committee, including any or all ofthe following: earnings (as measured by net income, net income per share, operating income,operating income per share, or earnings before interest, taxes, depreciation and amortization[“EBITDA”]), revenue growth, market capitalization, and price per share.          (c) For each fiscal year of the Company, the Committee shall (i) select those Participantswho shall be eligible to receive an Annual Incentive Award, (ii) determine the performance period,which may be a one to five fiscal year period, (iii) determine target levels of Companyperformance, and (iv) determine the level of Annual Incentive Award to be paid to each selectedParticipant upon the achievement of each performance level as provided below. The Committee shallgenerally make the foregoing determinations prior to the commencement of services to which anAnnual Incentive Award relates (or within the permissible time-period established under CodeSection 162(m), to the extent applicable) and while the outcome of the performance goals andtargets is uncertain.
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     **6.2****Attainment of Performance Targets****.**          (a) For each fiscal year, the Committee shall certify, in writing: (i) the degree to which theCompany has attained the performance targets, and (ii) the amount of the Annual Incentive Awardto be paid to each selected Participant.          (b) Notwithstanding anything to the contrary herein, the Committee may, in its discretion,reduce any Annual Incentive Award based on such factors as may be determined by the Committee,including, without limitation, a determination by the Committee that such a reduction isappropriate: (i) in light of pay practices of competitors; or (ii) in light of the Company’s, asubsidiary’s, or a selected Employee’s performance relative to competitors and/or performance withrespect to the Company’s strategic business goals.     **6.3****Payment of Annual Incentive Awards****.**An Annual Incentive Award shall be paid onlyif (i) the Company achieves at least the threshold performance level; and (ii) the Committeemakes the certification described in Section 6.2.     **6.4****Annual Incentive Award Payment Forms****.**          (a) Annual Incentive Awards shall be paid in cash and/or shares of Common Stock of theCompany, at the discretion of the Committee. Payments shall be made within 30 days following(i) a certification by the Committee that the performance targets were attained, and (ii) adetermination by the Committee that the amount of an Annual Incentive Award shall not be decreasedin accordance with Section 6.2. The aggregate maximum Annual Incentive Award that may beearned by any Participant on behalf of any one fiscal year (calculated as of the last day of thefiscal year for which the Annual Incentive Award is earned) may not exceed $1,000,000.          (b) The amount of an Annual Incentive Award to be paid upon the attainment of each targetedlevel of performance shall equal a percentage of each Participant’s base salary for the fiscal yearor a fixed dollar amount, as determined by the Committee.**VII. TERMINATION OF EMPLOYMENT OR SERVICES**     **7.1.****Options and Stock Appreciation Rights****.**          (a) If, prior to the date that an Option or Stock Appreciation Right first becomes Vested, aParticipant terminates employment or services for any reason (other than as provided in Section8.2, after a Change in Control), the Participant’s right to exercise the Option or StockAppreciation Right shall terminate and all rights thereunder shall cease.          (b) If, on or after the date that an Option or Stock Appreciation Right first becomes Vested,a Participant terminates employment or services for any reason other than death or Disability, theParticipant shall have the right, within the earlier of (i) the expiration of the Option or StockAppreciation Right, and (ii) three months after termination of employment/services, to exercise theOption or Stock Appreciation Right to the extent that it was exercisable and unexercised on thedate of the Participant’s termination of employment or
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services, subject to any other limitation onthe exercise of the Option or Stock Appreciation Right in effect on the date of exercise. TheCommittee may designate in a Participant’sAgreement that an Option or Stock Appreciation Right shall terminate at an earlier or latertime than set forth above.          (c) If, on or after the date that an Option or Stock Appreciation Right first becomes Vested,a Participant terminates employment or services due to death while an Option or Stock AppreciationRight is still exercisable, the person or persons to whom the Option or Stock Appreciation Rightshall have been transferred by will or by the laws of descent and distribution, shall have theright within the exercise period specified in the Participant’s Agreement to exercise the Option orStock Appreciation Right to the extent that it was exercisable and unexercised on the Participant’sdate of death, subject to any other limitation on exercise in effect on the date of exercise;provided, however, that the beneficial tax treatment of an Incentive Stock Option may be forfeitedif the Option is exercised more than one year after a Participant’s date of death.          (d) If, on or after the date that an Option or Stock Appreciation Right first becomes Vested,a Participant terminates employment or services due to Disability, the Participant shall have theright, within the exercise period specified in the Participant’s Agreement to exercise the Optionor Stock Appreciation Right to the extent that it was exercisable and unexercised on the date ofthe Participant’s termination of employment or services, subject to any other limitation on theexercise of the Option or Stock Appreciation Right in effect on the date of exercise. If theParticipant dies after termination of employment/services while the Option or Stock AppreciationRight is still exercisable, the Option or Stock Appreciation Right shall be exercisable inaccordance with the terms of paragraph (c) above.          (e) The Committee, at the time of a Participant’s termination of employment or services, mayaccelerate a Participant’s right to exercise an Option or extend the exercise period of an Optionor Stock Appreciation Right (but in no event past the tenth anniversary of the Grant Date of suchOption); provided, however that the extension of the exercise period for an Incentive Stock Optionmay cause such Option to forfeit its preferential tax treatment.          (f) Shares subject to Options and Stock Appreciation Rights that are not exercised inaccordance with the provisions of (a) through (e) above shall expire and be forfeited by theParticipant as of their expiration date and shall become available for new grants and awards underthe Plan as of such date.     **7.2****Restricted Stock Grants and Units****.**If a Participant terminates employment orservices for any reason (other than as provided in Section 8.2, after a Change in Control),the Participant’s rights to shares of Common Stock subject to a Restricted Stock grant orRestricted Stock Unit that are still subject to the Restriction Period automatically shallterminate and be forfeited by the Participant and, subject to Section 1.6, shall beavailable for new grants and awards under the Plan as of such termination date; provided, however,that the Committee, in its sole discretion, may waive or change the remaining restrictions or addadditional restrictions with respect to any Restricted Stock grant or Restricted Stock Unit thatwould otherwise be forfeited, as it deems appropriate. Notwithstanding the foregoing, theCommittee shall not waive
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any restrictions on a Code Section 162(m) Restricted Stock Award orRestricted Stock Unit, but the Committee may include a provision in an Employee’s Code Section162(m) Restricted Stockor Restricted Stock Unit Agreement stating that upon the Employee’s termination of employmentdue to (i) death, (ii) Disability, or (iii) involuntary termination by the Company withoutcause (as defined in such agreement) prior to the attainment of the associated performance goalsand the termination of the Restriction Period, that the performance goals and restrictions shall bedeemed to have been satisfied on a pro rata basis, so that the number of shares that become freelytransferable shall be based on the Employee’s full number of months of employment during theRestriction Period, and the Employee shall forfeit the remaining shares and his rights to suchforfeited shares shall terminate in full.     **7.3****Performance Shares****.**Performance Share Awards shall expire and be forfeited by aParticipant upon the Participant’s termination of employment or services for any reason (otherthan as provided in Section 8.2, after a Change in Control), and such shares shall beavailable for new grants and awards under the Plan as of such termination date; provided, however,that the Committee, in its discretion, may waive all or part of the conditions, goals andrestrictions applicable to the receipt of full or partial payment of a Performance Share Award.Notwithstanding the foregoing, the Committee shall not waive any restrictions on a Code Section162(m) Performance Share Award, but the Committee may include a provision in an Employee’s CodeSection 162(m) Performance Share Agreement stating that upon the Employee’s termination ofemployment due to (i) death, (ii) Disability, or (iii) involuntary termination by the Companywithout cause (as defined in such agreement) prior to the attainment of the associated performancegoals and restrictions, that the performance goals and restrictions shall be deemed to have beensatisfied on a pro rata basis, so that the number of shares that become freely transferable shallbe based on the Employee’s full number of months of employment during the employment period, andthe Employee shall forfeit the remaining shares and his rights to such forfeited shares shallterminate in full.     **7.4****Annual Incentive Awards****.**          (a) A Participant who has been granted an Annual Incentive Award and terminates employment orservices due to Retirement, Disability or death prior to the end of the Company’s fiscal yearshall be entitled to a prorated payment of the Annual Incentive Award, based on the number of fullmonths during the fiscal year in which the Participant was employed or provided services. Any suchprorated Annual Incentive Award shall be paid at the same time as regular Annual Incentive Awardsor, in the event of the Participant’s death, to the beneficiary designated by the Participant.          (b) Except as otherwise determined by the Committee in its discretion, a Participant who hasbeen granted an Annual Incentive Award and resigns or is terminated for any reason (other thanRetirement, Disability or death), before the end of the Company’s fiscal year for which theAnnual Incentive Award is to be paid, shall forfeit the right to an Annual Incentive Award paymentfor that fiscal year.     **7.5****Other Provisions****.**The transfer of an Employee from one corporation to anotheramong the Company and any of its Subsidiaries, or a leave of absence under the leave policy ofthe Company or any of its Subsidiaries shall not be a termination of employment for
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purposes ofthe Plan, unless a provision to the contrary is expressly stated by the Committee in aParticipant’s Agreement issued under the Plan.**VIII. ADJUSTMENTS AND CHANGE IN CONTROL**     **8.1****Adjustments****.**          (a) The total amount of Common Stock and kind of security for which Options, StockAppreciation Rights, Restricted Stock, Restricted Stock Units, Deferred Stock Units, PerformanceShare Awards and Annual Incentive Awards may be issued under the Plan, and the number and kind ofshares or securities subject to any such grants or awards (both as to the number of shares ofCommon Stock and the Option price), shall be adjusted pro rata for any increase or decrease in thenumber of outstanding shares of Common Stock or kind of securities resulting from a subdivision orcombination of shares of Common Stock, a reclassification of Common Stock, or stock dividend orother extraordinary distribution (whether in the form of cash, shares of Common Stock, othersecurities, or other property), recapitalization, stock split, reverse stock split, reorganization,merger, consolidation, split-up, spin-off, combination, repurchase or exchange of Common Stock orother securities of the Company, issuance of warrants or other rights to purchase Common Stockor other securities of the Company, or other similar corporate transaction or event thataffects the Common Stock such that an adjustment is determined by the Board to be appropriate inorder to prevent dilution or enlargement of the benefits or potential benefits intended to be madeavailable under the Plan and awards under the Plan. Such adjustment shall be made by the Board,whose determination in that respect shall be final, binding and conclusive.          (b) In the event of a proposed dissolution or liquidation of the Company, the Committeeshall notify each Participant as soon as practicable prior to the effective date of such proposedtransaction. The Committee in its discretion may provide for a Participant to have the right (i)to exercise his or her Option or Stock Appreciation Right, in full until ten (10) days prior tosuch transaction as to all of the shares of Common Stock covered thereby, including shares as towhich the Option or Stock Appreciation Right, would not otherwise be exercisable, and (ii) tobecome fully vested in and to settle in full any Restricted Stock grant, Restricted Stock Units,Deferred Stock Units, Performance Share Award, or Annual Incentive Award. In addition, theCommittee may provide that any re-purchase option of the Company applicable to the sharespurchased upon exercise of an Option or Stock Appreciation Right, or received pursuant to anyRestricted Stock grant, Restricted Stock Units, Deferred Stock Units, Performance Share Award orAnnual Incentive Award, shall lapse as to all such shares, provided that the proposed dissolutionor liquidation takes place at the time and in the manner contemplated. To the extent it has notbeen previously exercised or vested, an Option, Stock Appreciation Right, Restricted Stock grant,Restricted Stock Units, Deferred Stock Units, Performance Share Award or Annual Incentive Awardshall terminate immediately prior to the consummation of the proposed dissolution or liquidation.          (c) In the event of a merger of the Company with or into another corporation, the sale ofsubstantially all of the assets of the Company, or the reorganization or consolidation of theCompany, it is intended that each outstanding Option, Stock Appreciation
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Right, RestrictedStock grant, Restricted Stock Units, Deferred Stock Units, Performance Share Award or AnnualIncentive Award shall be assumed or an equivalent option or right substituted by the successorcorporation or the parent or a subsidiary of the successor corporation. In the event that suchsuccessor corporation (or the parent or a subsidiary thereof) refuses to assume orsubstitute for the Option, Stock Appreciation Right, Restricted Stock grant, Restricted StockUnits, Deferred Stock Units, Performance Share Award or Annual Incentive Award, the Participantshall fully vest in (and in the case of Options and Stock Appreciation Rights have the right toexercise for at least ten (10) days prior to such transaction) the Option, Stock AppreciationRight, Restricted Stock grant, Restricted Stock Units, Deferred Stock Units, Performance ShareAward or Annual Incentive Award in full, including shares which would not otherwise be vested orexercisable. If an Option, Stock Appreciation Right, Restricted Stock grant, Restricted StockUnits, Deferred Stock Units, Performance Share Award or Annual Incentive Award becomes fully vestedand exercisable in lieu of assumption or substitution in the event of a merger or sale of assets,the Committee shall notify the Participant in writing or electronically that the Option, StockAppreciation Right, Restricted Stock grant, Restricted Stock Units, Deferred Stock Units,Performance Share Award or Annual Incentive Award shall be fully vested and exercisable for aperiod of fifteen (15) days from the date of such notice, and the Option, Stock Appreciation Right,Restricted Stock grant, Restricted Stock Units, Deferred Stock Units, Performance Share Award orAnnual Incentive Award shall terminate upon the expiration of such period. For the purposes ofthis paragraph, the Option, Stock Appreciation Right, Restricted Stock grant, Restricted StockUnits, Deferred Stock Units, Performance Share Award or Annual Incentive Award shall be consideredassumed if, following the merger, sale of assets, reorganization or consolidation, the option orright confers the right to purchase or receive, for each share covered by the Participant’s Option,Stock Appreciation Right, Restricted Stock grant, Restricted Stock Units, Deferred Stock Units,Performance Share Award or Annual Incentive Award, immediately prior to such transaction, theconsideration (whether stock, cash, or other securities or property) received in the merger, saleof assets, reorganization or consolidation by holders of Common Stock for each share held on theeffective date of the transaction (and if holders were offered a choice of consideration, the typeof consideration chosen by the holders of a majority of the outstanding shares); provided, however,that if such consideration received in the merger, sale of assets, reorganization or consolidationis not solely common stock of the successor corporation (or the parent or a subsidiary thereof),the Committee may, with the consent of the successor corporation, provide for the consideration tobe received upon the exercise of the Option, Stock Appreciation Right, Restricted Stock grant,Restricted Stock Units, Deferred Stock Units, Performance Share Award or Annual Incentive Award,for each share of Stock subject to the Option, Stock Appreciation Right, Restricted Stock grant,Restricted Stock Units, Deferred Stock Units, Performance Share Award or Annual Incentive Award tobe solely Common Stock of the successor corporation (or the parent or a subsidiary thereof) equalin Fair Market Value to the per share consideration received by holders of Common Stock in themerger or sale of assets.          (d) The foregoing adjustments shall be made by the Committee. Any such adjustment may providefor the elimination of any fractional share which might otherwise become subject to an Option,Stock Appreciation Right, Restricted Stock grant, Restricted Stock Units, Deferred Stock Units,Performance Share Award or Annual Incentive Award.
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     **8.2****Change in Control****.**The Committee in its discretion may provide in a Participant’sAgreement, notwithstanding anything contained herein to the contrary, that in the event of aParticipant’s Change in Position subsequent to a Change in Control, any or all of the followingwill occur: (i) any outstanding Option or Stock Appreciation Right granted to such Participanthereunder immediately shall become fully Vested and exercisable in full, regardlessof any installment provision applicable to such Option or Stock Appreciation Right; (ii) theremaining Restriction Period on any shares of Common Stock subject to a Restricted Stock grant orRestricted Stock Unit hereunder immediately shall lapse and the shares shall become fullytransferable, subject to any applicable federal or state securities laws; (iii) all performancegoals and conditions shall be deemed to have been satisfied and all restrictions shall lapse on anyoutstanding Performance Share Awards granted to such Participant hereunder, and such Awards shallbecome payable in full; (iv) for purposes of any Annual Incentive Awards granted to suchParticipant hereunder, the determination of whether the performance targets have been achievedshall be made as of the date of the Change in Control and payments due should become immediatelypayable; and (v) all Deferred Stock Units shall be settled through their conversion, on aone-for-one basis of units for shares, into shares that are shall become fully transferable,subject to any applicable federal or state securities laws.**IX. MISCELLANEOUS**     **9.1****Partial Exercise/Fractional Shares****.**The Committee may permit, and shall establishprocedures for, the partial exercise of Options and Stock Appreciation Rights granted under thePlan. No fractional shares shall be issued in connection with the exercise of a Stock AppreciationRight or payment of a Performance Share Award or Annual Incentive Award; instead, the Fair MarketValue of the fractional shares shall be paid in cash, or at the discretion of the Committee, thenumber of shares shall be rounded down to the nearest whole number of shares and any fractionalshares shall be disregarded.     **9.2****Rule 16b-3 Requirements****.**Notwithstanding any other provision of the Plan, theCommittee may impose such conditions on the exercise of an Option or Stock Appreciation Right(including, without limitation, the right of the Committee to limit the time of exercise tospecified periods), or the grant of Restricted Stock, Restricted Stock Unit, Deferred Stock Unit,or the payment of a Performance Share Award or Annual Incentive Award, as may be required tosatisfy the requirements of Rule 16b-3 of the Exchange Act.     **9.3****Rights Prior to Issuance of Shares****.**Unless otherwise provided in the Plan, noParticipant shall have any rights as a shareholder with respect to shares covered by an Option,Stock Appreciation Right, Restricted Stock grant, Restricted Stock Units, Deferred Stock Units,Performance Share Award or Annual Incentive Award until the issuance of a stock certificate forsuch shares. No adjustment shall be made for dividends or other rights with respect to such sharesfor which the record date is prior to the date the certificate is issued.     **9.4****Non-Assignability****.**Except as otherwise determined by the Committee in itsdiscretion, the following restrictions on assignability of any award under the Plan shall apply toall Participants: (i) no Option, Stock Appreciation Right, Restricted Stock grant, RestrictedStock Units, Deferred Stock Units, Performance Share Award or Annual Incentive Award shall
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betransferable by a Participant except by will or the laws of descent and distribution; (ii) duringthe lifetime of a Participant, an Option, Stock Appreciation Right, Restricted Stock grant, orRestricted Stock Unit or Deferred Stock Unit shall be exercised or settled only by the Participant,except in the event of the Participant’s Disability, in which case the Participant’s legal guardianor the individual designated in the Participant’s durable power of attorney may exercise or settlethe Option, Stock Appreciation Right, Restricted Stock grant, Restricted Stock Unit, orDeferred Stock Unit; and (iii) any transferee of the Option, Stock Appreciation Right, RestrictedStock grant, Restricted Stock Unit, Deferred Stock Unit, Performance Share Award or AnnualIncentive Award shall take the same subject to the terms and conditions of this Plan. No transferof an Option, Stock Appreciation Right, Restricted Stock grant, Restricted Stock Units, DeferredStock Units, Performance Share Award or Annual Incentive Award by will or the laws of descent anddistribution, or as otherwise permitted by the Committee, shall be effective to bind theCompany unless the Company shall have been furnished with written notice thereof and a copyof the will and/or such evidence as the Company may deem necessary to establish the validity ofthe transfer and the acceptance by the transferee or transferees of the terms and conditions of theOption, Stock Appreciation Right, Restricted Stock grant, Restricted Stock Units, Deferred StockUnits, Performance Share Award or Annual Incentive Award.     **9.5.****Securities Laws****.**          (a) Anything to the contrary herein notwithstanding, the Company’s obligation to sell anddeliver Common Stock pursuant to the exercise of an Option or Stock Appreciation Right or deliverCommon Stock pursuant to a Restricted Stock grant, Restricted Stock Units, Deferred Stock Units,Performance Share Award or Annual Incentive Award is subject to such compliance with federal andstate laws, rules and regulations applying to the authorization, issuance or sale of securities asthe Company deems necessary or advisable. The Company shall not be required to sell anddeliver or issue Common Stock unless and until it receives satisfactory assurance that the issuanceor transfer of such shares shall not violate any of the provisions of the Securities Act of 1933 orthe Securities Exchange Act of 1934, or the rules and regulations of the Securities ExchangeCommission promulgated thereunder or those of the Stock Exchange or any stock exchange on which theCommon Stock may be listed, the provisions of any state laws governing the sale of securities, orthat there has been compliance with the provisions of such acts, rules, regulations and laws.          (b) The Committee may impose such restrictions on any shares of Common Stock acquired pursuantto the exercise of an Option or Stock Appreciation Right or the grant of Restricted Stock,Restricted Stock Units, or Deferred Stock Units, or the payment of a Performance Share Award orAnnual Incentive Award under the Plan as it may deem advisable, including, without limitation,restrictions (i) under applicable federal securities laws, (ii) under the requirements of the StockExchange or any other securities exchange, recognized trading market or quotation system uponwhich such shares of Common Stock are then listed or traded, and (iii) under any blue sky or statesecurities laws applicable to such shares. No shares shall be issued until counsel for theCompany has determined that the Company has complied with all requirements underappropriate securities laws.
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     **9.6****Withholding Taxes****.**          (a) The Company shall have the right to withhold from a Participant’s compensation orrequire a Participant to remit sufficient funds to satisfy applicable withholding for income andemployment taxes upon the exercise of an Option or Stock Appreciation Right orthe lapse of the Restriction Period on shares of Common Stock subject to a Restricted Stockgrant or Restricted Stock Unit or the payment of a Performance Share Award or Annual IncentiveAward or the settlement of a Deferred Stock Unit Award. A Participant may make a written electionto tender previously-acquired shares of Common Stock or have shares of stock withheld from theexercise or settlement of a Restricted Stock grant, Restricted Stock Unit, Deferred Stock Unit,Performance Share Award, or Annual Incentive Award, provided that the shares have an aggregate FairMarket Value sufficient to satisfy in whole or in part the applicable withholding taxes. Thecashless exercise procedure of Section 2.4 may be utilized to satisfy the withholdingrequirements related to the exercise of an Option. At no point shall the Company withhold fromthe exercise of an Option or Stock Appreciation Right, or the settlement of a Restricted Stockgrant, Restricted Stock Unit, Deferred Stock Unit, Performance Share Award or Annual IncentiveAward, more shares than are necessary to meet the minimum established tax withholding requirementsof federal, state and local obligations.          (b) A Participant subject to the insider trading restrictions of Section 16(b) of the ExchangeAct may use Common Stock to satisfy the applicable withholding requirements only if suchdisposition is approved in accordance with Rule 16b-3 of the Exchange Act. Any election by aParticipant to utilize Common Stock for withholding purposes is further subject to the discretionof the Committee.          (c) Participants are solely responsible and liable for the satisfaction of all taxes andpenalties that may arise in connection with Awards (including any taxes arising under Section 409Aof the Code), and the Company shall not have any obligation to indemnify or otherwise hold anyParticipant harmless from any or all of such taxes. The Committee shall have the discretion toorganize any deferral program, to require deferral election forms, and to grant or to unilaterallymodify any Award in a manner that (i) conforms with the requirements of Section 409A of the Codewith respect to compensation that is deferred and/or that vests after December 31, 2004, (ii) thatvoids any Participant election to the extent it would violate Section 409A of the Code, and (iii)for any distribution election that would violate Section 409A of the Code, to make distributionspursuant to the Award at the earliest to occur of a distribution event that is allowable underSection 409A of the Code or any distribution event that is both allowable under Section 409A of theCode and is elected by the Participant, subject to any valid second election to defer, providedthat the Committee permits second elections to defer in accordance with Section 409A(a)(4)(C). TheCommittee shall have the sole discretion to interpret the requirements of the Code, includingSection 409A, for purposes of the Plan and all Awards.     **9.7****Termination and Amendment****.**          (a) The Board may terminate the Plan, or the granting of Options, Stock Appreciation Rights,Restricted Stock, Restricted Stock Units, Deferred Stock Units,
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Performance Share Awards or AnnualIncentive Awards under the Plan, at any time. No new grants or awards shall be made under the Planafter the tenth anniversary of the initial adoption of this Plan by the Board, or approval by theshareholders, whichever is earlier, as noted in Section 1.1.          (b) The Board may amend or modify the Plan at any time and from time to time, but anyamendment or modification shall be subject to the approval of the shareholders of the Companyto the extent required by applicable law, as well as to the extent the Board determines thatshareholder approval is desirable for tax, securities, stock exchange, or other purposes.          (c) No amendment, modification, or termination of the Plan shall in any manner adverselyaffect any Option, Stock Appreciation Right, Restricted Stock grant, Restricted Stock Units,Deferred Stock Units, Performance Share Award or Annual Incentive Award granted under the Planwithout the consent of the Participant holding the Option, Stock Appreciation Right, RestrictedStock grant, Restricted Stock Units, Deferred Stock Units, Performance Share Award or AnnualIncentive Award, except as set forth in any Agreement relating to such Option, Stock AppreciationRight, Restricted Stock grant, Restricted Stock Units, Deferred Stock Units, Performance ShareAward or Annual Incentive Award granted under the Plan (with such effect being presumed to arisefrom a modification that would trigger a violation of Section 409A of the Code).     **9.8****Effect on Employment****.**Neither the adoption of the Plan nor the granting of anyOption, Stock Appreciation Right, Restricted Stock, Restricted Stock Units, Deferred Stock Units,Performance Share Award or Annual Incentive Award pursuant to the Plan shall be deemed to createany right in any individual to be retained or continued in the employment, or as a non-employeedirector or consultant, of the Company or a Subsidiary.     **9.9****Use of Proceeds****.**The proceeds received from the sale of Common Stock pursuant tothe Plan will be used for general corporate purposes of the Company.     **9.10****Approval of Plan****.**Unless this Plan has been approved by the shareholders of theCompany within 12 months after adoption of the Plan by the Board, as required by Section 422 ofthe Code, this Plan, and any grants or awards made hereunder, shall be of no further force oreffect.
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