**EXHIBIT 10.13.2**

 

 

**WASHINGTONGROUP INTERNATIONAL, INC.**

 

**EQUITYAND PERFORMANCE INCENTIVE PLAN**

 

**of**

 

**January25, 2002**

 

 

**AMENDED AND RESTATED ASOF AUGUST 14, 2003**

 

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**TABLE OF CONTENTS**

 
| 1.     | Purpose                 |   |
|--------|-------------------------|--------|
|   |                    |   |
| 2      | Definitions             |   |
|   |                    |   |
|   | Annual Meeting          |   |
|   | Appreciation Right      |   |
|   | Board                   |   |
|   | Change in Control       |   |
|   | Code                    |   |
|   | Common Shares           |   |
|   | Covered Employee        |   |
|   | Date of Grant           |   |
|   | Deferral Period         |   |
|   | Deferred Shares         |   |
|   | Designated Subsidiary   |   |
|   | Effective Date          |   |
|   | Evidence of Award       |   |
|   | Exchange Act            |   |
|   | Incentive Stock Options |   |
|   | Management Objectives   |   |
|   | Market Value per Share  |   |
|   | Non-Employee Director   |   |
|   | Optionee                |   |
|   | Option Price            |   |
|   | Option Right            |   |
|   | Participant             |   |
|   | Performance Period      |   |
|   | Performance Share       |   |
|   | Performance Unit        |   |
|   | Plan of Reorganization  |   |
|   | Reload Option Rights    |   |
|   | Restricted Shares       |   |
|   | Retirement              |   |
|   | Rule 16b-3              |   |
|   | Securities Act          |   |
|   | Spread                  |   |
|   | Subsidiary              |   |
|   | Termination for Cause   |   |
|   | Voting Shares           |   |
|   | Year of Service         |   |

 

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| 3.     | Shares Available Under  the Plan                       |   |
|--------|--------------------------------------------------------|--------|
|   |                                                   |   |
| 4      | Option Rights                                          |   |
|   |                                                   |   |
| 5.     | Appreciation Rights                                    |   |
|   |                                                   |   |
| 6.     | Restricted Shares                                      |   |
|   |                                                   |   |
| 7.     | Deferred Shares                                        |   |
|   |                                                   |   |
| 8.     | Performance  Shares and Performance Units              |   |
|   |                                                   |   |
| 9.     | Awards to Non-Employee  Directors                      |   |
|   |                                                   |   |
| 10.    | Transferability                                        |   |
|   |                                                   |   |
| 11.    | Adjustments                                            |   |
|   |                                                   |   |
| 12.    | Change in Control                                      |   |
|   |                                                   |   |
| 13.    | Fractional Shares                                      |   |
|   |                                                   |   |
| 14.    | Withholding Taxes                                      |   |
|   |                                                   |   |
| 15.    | Participation  by Employees of Designated Subsidiaries |   |
|   |                                                   |   |
| 16.    | Foreign Employees                                      |   |
|   |                                                   |   |
| 17.    | Administration of the Plan                             |   |
|   |                                                   |   |
| 18.    | Governing Law                                          |   |
|   |                                                   |   |
| 19.    | Amendments, Etc.                                       |   |
|   |                                                   |   |
| 20.    | Termination                                            |   |

 

ii

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**WASHINGTONGROUP INTERNATIONAL, INC.**

 

**EQUITY AND PERFORMANCEINCENTIVE PLAN**

 

1.             **Purpose**.  Thepurpose of the Equity and Performance Incentive Plan (this “Plan”) is toattract and retain directors, officers and key employees for Washington GroupInternational, Inc. (the “Corporation”) and its Subsidiaries and to provide tosuch persons incentives and rewards for superior performance.

 

2.             **Definitions**.  **As used in this Plan:**

 

“Annual Meeting”  means the annual meeting of stockholders ofthe Corporation.

 

“Appreciation Right”means a right granted pursuant to Section 5 of this Plan.

 

“Board” means the Board of Directorsof the Corporation and, to the extent of any delegation by the Board to acommittee (or subcommittee thereof) pursuant to Section 17 of this Plan, suchcommittee (or subcommittee thereof).

 

“Change in Control” shall have themeaning provided in Section 12 of this Plan.

 

“Code” means the Internal RevenueCode of 1986, as amended from time to time.

 

“Common Shares” means shares ofcommon stock, par value $.01 per share, of the Corporation or any security intowhich such shares of common stock may be changed by reason of any transactionor event of the type referred to in Section 11 of this Plan.

 

“Covered Employee” means a Participantwho is, or who the Board determines may eventually become, a “covered employee”within the meaning of Section 162(m) of the Code (or any successor provision).

 

“Date of Grant” means the datespecified by the Board on which a grant of Option Rights, Appreciation Rights,Performance Shares or Performance Units or a grant or sale of Restricted Sharesor Deferred Shares shall become effective (which date shall not be earlier thanthe date on which the Board takes action with respect thereto) and shall alsoinclude the date on which a grant of Option Rights to a Non-Employee Directorbecomes effective pursuant to Section 9 of this Plan.

 

“Deferral Period” means the periodof time during which Deferred Shares are subject to deferral limitations underSection 7 of this Plan.

 

“Deferred Shares” means an awardmade pursuant to Section 7 of this Plan of the right to receive Common Sharesat the end of a specified Deferral Period.

 

“Designated Subsidiary”means a Subsidiary that is (a) not a corporation or (b) a corporationin which at the time the Corporation owns or controls, directly or indirectly,less than 80% of the total combined voting power represented by all classes ofstock issued by such corporation.

 

“Effective Date” means the effectivedate of the Plan of Reorganization 

 

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“Evidence of Award” means anagreement, certificate, resolution or other type of writing or other evidenceapproved by the Board which sets forth the terms and conditions of the OptionRights, Appreciation Rights, Performance Units, Performance Shares, RestrictedShares, Deferred Shares or other awards. An Evidence of Award may be in an electronic medium, may be limited to anotation on the books and records of the Corporation and, with the approval ofthe Board (or committee or subcommittee thereof delegated pursuant toSection 17 of this Plan), need not be signed by a representative of theCorporation or a Participant.

 

“Exchange Act” means the SecuritiesExchange Act of 1934, as amended, and the rules and regulations thereunder, assuch law, rules and regulations may be amended from time to time.

 

“Incentive Stock Options”means Option Rights that are intended to qualify as “incentive stock options”under Section 422 of the Code or any successor provision.

 

“Management Objectives”means the measurable performance objective or objectives established pursuantto this Plan for Participants who have received grants of Performance Shares orPerformance Units or, when so determined by the Board, Option Rights,Appreciation Rights, Restricted Shares and dividend credits pursuant to thisPlan.  Management Objectives may bedescribed in terms of Corporation-wide objectives or objectives that arerelated to the performance of the individual Participant or of the Subsidiary,division, department, region or function within the Corporation or Subsidiaryin which the Participant is employed. The Management Objectives may be made relative to the performance ofother corporations.  The ManagementObjectives applicable to any award to a Covered Employee shall be based onspecified levels of or growth in one or more of the following criteria:

 

1.             earnings;

 

2.             earnings per share(earnings per share will be calculated without regard to any change inaccounting standards that may be required by the Financial Accounting StandardsBoard after the goal is established);

 

3.             share price;

 

4.             total shareholderreturn;

 

5.             return on investedcapital, equity, or assets;

 

6.             operating earnings;

 

7.             sales growth;

 

8.             productivityimprovement;

 

If the Board determinesthat a change in the business, operations, corporate structure or capitalstructure of the Corporation, or the manner in which it conducts its business,or other events or circumstances render the Management Objectives unsuitable,the Board may in its discretion modify such Management Objectives or therelated minimum acceptable level of achievement, in whole or in part, as theBoard deems appropriate and equitable, except in the case of a Covered Employeewhere such action would result in the loss of the otherwise available

 

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exemption under Section 162(m) of the Code.  In such case, the Board shall not make any modification of theManagement Objectives or minimum acceptable level of achievement.

 

“Market Value per Share”means, as of any particular date, the closing sale price per Common Share onthe national securities exchange on which the Common Shares are then listed,the final reported bid sale price per Common Share on the principal nationalautomated system which the Common Shares are then quoted or, if the CommonShares are not then listed or quoted, the fair market value of the CommonShares as determined by the Board.

 

“Non-Employee Director”means a Director of the Corporation who is not an employee of the Corporationor any Subsidiary.

 

“Optionee” means the optionee namedin an Evidence of Award evidencing an outstanding Option Right.

 

“Option Price” means the purchaseprice payable on exercise of an Option Right.

 

“Option Right” means the right topurchase Common Shares upon exercise of an option granted pursuant to Section 4or Section 9 of this Plan.

 

“Participant” means a person who isselected by the Board to receive benefits under this Plan and who is at thetime an officer or other key employee of the Corporation or any one or more ofits Subsidiaries, or who has agreed to commence serving in any of suchcapacities within 90 days of the Date of Grant, and shall also include eachNon-Employee Director who receives an award of Option Rights pursuant toSection 9 of this Plan; provided, however, that for purposes of Sections 4, 5,7 and 8 of this Plan, Participant shall not include such Non-Employee Director.

 

“Performance Period”means, in respect of a Performance Share or Performance Unit, a period of timeestablished pursuant to Section 8 of this Plan within which the ManagementObjectives relating to such Performance Share or Performance Unit are to beachieved.

 

“Performance Share”means a bookkeeping entry that records the equivalent of one Common Shareawarded pursuant to Section 8 of this Plan.

 

“Performance Unit” means abookkeeping entry that records a right to payment, the value of which iscontingent upon performance as measured against pre-determined ManagementObjectives established pursuant to Section 8 of this Plan.

 

“Plan ofReorganization” means the Corporation’s Second Amended JointPlan of Reorganization, as modified, which was confirmed on December 21, 2001pursuant to an order of the United States Bankruptcy Court for the District ofNevada in bankruptcy case 01-31-627, including such order and the relatedfindings of fact and conclusions of law.

 

“Reload Option Rights”means additional Option Rights granted automatically to an Optionee upon theexercise of Option Rights pursuant to Section 4(i) or Section 9(a)(viii) ofthis Plan.

 

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“Restricted Shares”means Common Shares granted or sold pursuant to Section 6 or Section 9 of thisPlan as to which neither the substantial risk of forfeiture nor the prohibitionon transfers referred to in such Section 6 has expired.

 

“Retirement” means a termination ofemployment with the Corporation and its Subsidiaries at or after the attainmentof (a) age 65, (b) age 55 with at least ten Years of Service, or (c) 30 Yearsof Service.

 

“Rule l6b-3” means Rule 16b-3 of theSecurities and Exchange Commission (or any successor rule to the same effect)as in effect from time to time.

 

“Securities Act” means theSecurities Act of 1933, as amended, and the rules and regulations thereunder,as such law, rules and regulations may be amended from time to time.

 

“Spread” means the excess of theMarket Value per Share of the Common Shares on the date when an AppreciationRight is exercised, or on the date when Option Rights are surrendered inpayment of the Option Price of other Option Rights, over the Option Priceprovided for in the related Option Right.

 

“Subsidiary” means a corporation,company or other entity (a) more than 50% of whose outstanding shares orsecurities (representing the right to vote for the election of directors orother managing authority) are, or (b) that does not have outstandingshares or securities (as may be the case in a partnership, joint venture orunincorporated association), but more than 50% of whose ownership interestrepresenting the right generally to make decisions for such other entity is,now or hereafter, owned or controlled, directly or indirectly, by theCorporation except that for purposes of determining whether any person may be aParticipant for purposes of any grant of Incentive Stock Options, “Subsidiary”means any corporation in which at the time the Corporation owns or controls,directly or indirectly, more than 50% of the total combined voting powerrepresented by all classes of stock issued by such corporation.

 

“Termination for Cause”means a termination of a Participant’s employment following:

 

(a)           the determination bythe Corporation or the Board that the Participant has ceased to perform hisduties to the Corporation (other than as a result of his incapacity due tophysical or mental illness or injury), which failure amounts to an intentionalor extended neglect of his duties to the Corporation, or

(b)           the Corporation’s orBoard’s determination that the Participant has engaged in or is about to engagein conduct materially injurious to the Corporation, or

(c)           the Participant havingbeen convicted of, or plead guilty or no contest to, a felony or the failure ofthe Participant to follow instruction of the Board or his direct superiors.

 

“Voting Shares”means at any time, the then-outstanding securities entitled to vote generallyin the election of directors of the Corporation.

 

“Year of Service” means a year ofservice as defined pursuant to the Washington Group International, Inc. 401(k)Retirement Savings Plan (or any successor plan thereto) for vesting purposes.

 

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**3.****             Shares Available Under the Plan**.  

 

(a)           Subjectto adjustment as provided in Section 11 of this Plan, the number of CommonShares that may be issued or transferred (i) upon the exercise of OptionRights or Appreciation Rights, (ii) as Restricted Shares and released fromsubstantial risks of forfeiture thereof, (iii) as Deferred Shares,(iv) in payment of Performance Shares or Performance Units that have beenearned, (v) as awards to Non-Employee Directors or (vi) in payment ofdividend equivalents paid with respect to awards made under the Plan shall notexceed in the aggregate 6,002,000 shares plus any shares relating to awardsthat expire or are forfeited or cancelled. Such shares may be shares of original issuance or treasury shares or acombination of the foregoing.  Upon thepayment of any Option Price by the transfer to the Corporation of Common Sharesor upon satisfaction of any withholding amount by means of transfer orrelinquishment of Common Shares, there shall be deemed to have been issued ortransferred under this Plan only the net number of Common Shares actuallyissued or transferred by the Corporation.

 

(b)           Notwithstandinganything in this Section 3, or elsewhere in this Plan, to the contrary, theaggregate number of Common Shares actually issued or transferred by theCorporation upon the exercise of Incentive Stock Options shall not exceed5,952,000 shares.  Further, noParticipant shall be granted Option Rights for more than 3,500,000 CommonShares during any calendar year, subject to adjustments as provided in Section11 of this Plan.

 

(c)           Uponpayment in cash of the benefit provided by any award granted under this Plan,any shares that were covered by that award shall again be available for issueor transfer hereunder.

 

(d)           Notwithstandingany other provision of this Plan to the contrary, in no event shall anyParticipant in any calendar year receive more than 200,000 Appreciation Rights,subject to adjustments as provided in Section 11 of this Plan.

 

(e)         Notwithstanding any otherprovision of this Plan to the contrary, in no event shall any Participant inany calendar year receive more than 200,000 Restricted Shares or 200,000Deferred Shares, subject to adjustments as provided in Section 11 of this Plan.

 

(f)            Notwithstandingany other provision of this Plan to the contrary, in no event shall anyParticipant in any calendar year receive an award of Performance Shares orPerformance Units having an aggregate maximum value as of their respectiveDates of Grant in excess of $2,000,000.

 

**4.**             **OptionRights**.  The Board may,from time to time and upon such terms and conditions as it may determine,authorize the granting to Participants of options to purchase CommonShares.  Each such grant may utilize anyor all of the authorizations, and shall be subject to all of the requirements,contained in the following provisions:

 

(a)           Eachgrant shall specify the number of Common Shares to which it pertains, subjectto the limitations set forth in Section 3 of this Plan.

 

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(b)           Eachgrant shall specify an Option Price per share, which shall be set by the Board;provided, however, that such price shall be no less than the par value of ashare of Common Stock, and in the case of Incentive Stock Options, such priceshall be not less than the Market Value per share on the Date of the Grant.

 

(c)           Eachsuch Option Right shall become exercisable as determined by the Board and setforth in the applicable Option Rights Agreement.  Such Option rights shall become exercisable in full immediatelyin the event of a Change in Control. Each such Option Right granted under this Plan shall expire no laterthan ten years from the Date of Grant and shall be subject to earliertermination as hereinafter provided and as set forth in the applicable OptionRights Agreement.

 

(d)           Eachsuch Incentive Stock Option shall terminate automatically and without furthernotice after the employee ceases to be an employee of the Company and itsSubsidiaries for any reason other than as described in Section 4(e) ofthis Plan; provided, however, that the employee shall have until the first tooccur of (i) the stated expiration date of such Option Right or(ii) the 90th calendar day following the effective date of anysuch termination of employment to exercise Option Rights that had vested andbecome exercisable as of such effective date of termination of employment toexercise Incentive Stock Options that had vested and become exercisable as ofsuch effective date of termination of employment.

 

(e)           Inthe event of the  (i) death, (ii)disability or (iii) Retirement under a retirement plan of the company or one ofits Subsidiaries at or after the earliest voluntary retirement age provided orin such retirement plan or retirement at any earlier age with consent of theBoard, each of the then outstanding Incentive Stock Options of such holder maybe exercised at any time within three years after such death, disability orretirement, but in no event after the expiration date of the term of suchIncentive Stock Options.

 

(f)            Eachgrant shall specify whether the Option Price shall be payable (i) in cash or bycheck acceptable to the Corporation, (ii) by the actual or constructivetransfer to the Corporation of nonforfeitable, unrestricted Common Shares ownedfor more than six months by the Optionee (or other consideration authorizedpursuant to subsection (g) below) having a value at the time of exercise equalto the total Option Price or (iii) by a combination of such methods of payment.

 

(g)           TheBoard may determine, at or after the Date of Grant, that payment of the OptionPrice of any option (other than an Incentive Stock Option) may also be made inwhole or in part in the form of Restricted Shares or other Common Shares thatare forfeitable or subject to restrictions on transfer, Deferred Shares,Performance Shares (based, in each case, on the Market Value per Share on thedate of exercise), other Option Rights (based on the Spread on the date ofexercise) or Performance Units.  Unlessotherwise determined by the Board at or after the Date of Grant, whenever anyOption Price is paid in whole or in part by means of any of the forms ofconsideration specified in this paragraph, the Common Shares received upon theexercise of the Option Rights shall be subject to such risks of forfeiture orrestrictions on transfer as may correspond to any that apply to theconsideration surrendered, but only to the extent of (i) the number of

 

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shares or PerformanceShares, (ii) the Spread of any unexercisable portion of Option Rights or(iii) the stated value of Performance Units surrendered.

 

(h)           Anygrant may provide for deferred payment of the Option Price from the proceeds ofsale through a bank or broker on a date satisfactory to the Corporation of someor all of the shares to which such exercise relates.

 

(i)            Anygrant may, at or after the Date of Grant, provide for the automatic grant ofReload Option Rights to an Optionee upon the exercise of Option Rights(including Reload Option Rights) using Common Shares or other considerationspecified in paragraph (g) above. Reload Option Rights shall cover up to the number of Common Shares,Deferred Shares, Option Rights or Performance Shares (or the number of CommonShares having a value equal to the value of any Performance Units) surrenderedto the Corporation upon any such exercise in payment of the Option Price or tomeet any withholding obligations. Reload Options may have an Option Price that is no less than that whichrepresents the same percentage of the Market Value per Share at the time ofexercise of the Option Rights that the per share Option Price represented ofthe Market Value per Share at the time the Option Rights being exercised weregranted and shall be on such other terms as may be specified by the Directors,which may be the same as or different from those of the original Option Rights.

 

(j)            Successivegrants may be made to the same Participant whether or not any Option Rightspreviously granted to such Participant remain unexercised.

 

(k)           Anygrant of Option Rights may specify Management Objectives that must be achievedas a condition to the exercise of such rights.

 

(l)            OptionRights granted under this Plan may be (i) options, including, withoutlimitation, Incentive Stock Options, that are intended to qualify underparticular provisions of the Code, (ii) options that are not intended soto qualify or (iii) combinations of the foregoing.

 

(m)          TheBoard may, at or after the Date of Grant of any Option Rights (other thanIncentive Stock Options), provide for the payment of dividend equivalents tothe Optionee on either a current or deferred or contingent basis or may providethat such equivalents shall be credited against the Option Price.

 

(n)           Theexercise of an Option Right shall result in the cancellation on ashare-for-share basis of any related Appreciation Right authorized underSection 5 of this Plan.

 

(o)           Eachgrant of Option Rights shall be evidenced by an Option Rights Agreement, whichshall contain such terms and provisions, consistent with this Plan, as theBoard may approve.

 

(p)           Each grant of OptionRights shall be subject to the provisions of Section 19(g) of this Plan.

 

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**5.**             **Appreciation Rights**.  The Board may also authorize the granting toany Optionee of Appreciation Rights in respect of Option Rights grantedhereunder at any time prior to the exercise or termination of such relatedOption Rights; provided, however, that an Appreciation Right awarded inrelation to an Incentive Stock Option must be granted concurrently with suchIncentive Stock Option.  An AppreciationRight shall be a right of the Optionee, exercisable by surrender of the relatedOption Right, to receive from the Corporation an amount determined by theBoard, which shall be expressed as a percentage of the Spread (not exceeding100%) at the time of exercise. Each such grant may utilize any or all of theauthorizations, and shall be subject to all of the requirements, contained inthe following provisions:

 

(a)           Anygrant may specify that the amount payable on exercise of an Appreciation Rightmay be paid by the Corporation in cash, in Common Shares or in any combinationthereof and may either grant to the Participant or retain in the Board theright to elect among those alternatives.

 

(b)           Anygrant may specify that the amount payable on exercise of an Appreciation Rightmay not exceed a maximum specified by the Board at the Date of Grant.

 

(c)           Anygrant may specify waiting periods before exercise and permissible exercisedates or periods and shall provide that no Appreciation Right may be exercisedexcept at a time when the related Option Right is also exercisable and at atime when the Spread is positive. 

 

(d)           Anygrant may specify that such Appreciation Right may be exercised only in theevent of a Change in Control or other similar transaction or event.

 

(e)           Eachgrant of Appreciation Rights shall be evidenced by an Evidence of Award thatshall describe such Appreciation Rights, identify the related Option Rights,state that such Appreciation Rights are subject to all the terms and conditionsof this Plan, and contain such other terms and provisions, consistent with thisPlan, as the Board may approve.

 

(f)            Anygrant of Appreciation Rights may specify Management Objectives that must beachieved as a condition of the exercise of such rights.

 

(g)           Eachgrant of Appreciation Rights shall be subject to the provisions of Section19(g) of this plan.

 

**6.**             **RestrictedShares**.  The Board mayalso authorize the grant or sale to Participants of Restricted Shares. Eachsuch grant or sale may utilize any or all of the authorizations, and shall besubject to all of the requirements, contained in the following provisions:

 

(a)           Eachsuch grant or sale shall constitute an immediate transfer of the ownership ofCommon Shares to the Participant in consideration of the performance ofservices, entitling such Participant to voting, dividend and other ownershiprights, but subject to the substantial risk of forfeiture and restrictions ontransfer hereinafter referred to.

 

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(b)           Eachsuch grant or sale may be made without additional consideration or inconsideration of a payment by such Participant that is less than Market Valueper Share at the Date of Grant.

 

(c)           Eachsuch grant or sale shall provide that the Restricted Shares covered by suchgrant or sale shall be subject, except (if the Board shall so determine) in theevent of a Change in Control or other similar transaction or event, for aperiod of not less than three years to be determined by the Board at the Dateof Grant, to a “substantial risk of forfeiture” within the meaning of Section83 of the Code.

 

(d)           Eachsuch grant or sale shall provide that during the period for which suchsubstantial risk of forfeiture is to continue, the transferability of theRestricted Shares shall be prohibited or restricted in the manner and to theextent prescribed by the Board at the Date of Grant (which restrictions mayinclude, without limitation, rights of repurchase or first refusal in theCorporation or provisions subjecting the Restricted Shares to a continuingsubstantial risk of forfeiture in the hands of any transferee).

 

(e)           Anygrant of Restricted Shares may specify Management Objectives that, if achieved,will result in termination or early termination of the restrictions applicableto such shares and each grant may specify with respect to such specifiedManagement Objectives, a minimum acceptable level of achievement and shall setforth a formula for determining the number of Restricted Shares on whichrestrictions will terminate if performance is at or above the minimum level,but falls short of full achievement of the specified Management Objectives.

 

(f)            Anysuch grant or sale of Restricted Shares may require that any or all dividendsor other distributions paid thereon during the period of such restrictions beautomatically deferred and reinvested in additional Restricted Shares, whichmay be subject to the same restrictions as the underlying award.

 

(g)           Eachgrant or sale of Restricted Shares shall be evidenced by an Evidence of Awardthat shall contain such terms and provisions, consistent with this Plan, as theBoard may approve.  Unless otherwisedirected by the Board, all certificates representing Restricted Shares shall beheld in custody by the Corporation until all restrictions thereon shall havelapsed, together with a stock power or powers executed by the Participant inwhose name such certificates are registered, endorsed in blank and coveringsuch Shares.

 

(h)           Eachgrant or sale of Restricted shares shall be subject to the provisions ofSection 19(g) of this plan.

 

**7.**             **Deferred Shares**.  The Board may also authorize the granting orsale of Deferred Shares to Participants. Each such grant or sale may utilize any or all of the authorizations,and shall be subject to all of the requirements contained in the followingprovisions:

 

(a)           Eachsuch grant or sale shall constitute the agreement by the Corporation to deliverCommon Shares to the Participant in the future in consideration of the

 

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performance of services,but subject to the fulfillment of such conditions during the Deferral Period asthe Board may specify.

 

(b)           Eachsuch grant or sale may be made without additional consideration or inconsideration of a payment by such Participant that is less than the MarketValue per Share at the Date of Grant.

 

(c)           Eachsuch grant or sale shall be subject, except (if the Board shall so determine)in the event of a Change in Control or other similar transaction or event, to aDeferral Period of not less than one year, as determined by the Board at theDate of Grant.

 

(d)           Duringthe Deferral Period, the Participant shall have no right to transfer any rightsunder his or her award and shall have no rights of ownership in the DeferredShares and shall have no right to vote them, but the Board may, at or after theDate of Grant, authorize the payment of dividend equivalents on such Shares oneither a current or deferred or contingent basis, either in cash or inadditional Common Shares.

 

(e)           Eachgrant or sale of Deferred Shares shall be evidenced by an Evidence of Awardcontaining such terms and provisions, consistent with this Plan, as the Boardmay approve.

 

(f)            Eachgrant or sale of Deferred Shares shall be subject to the provisions of Section19(g) of this plan.

 

**8.**             **Performance Shares and Performance Units**.  The Board may also authorize the granting ofPerformance Shares and Performance Units that will become payable to aParticipant upon achievement of specified Management Objectives.  Each such grant may utilize any or all ofthe authorizations, and shall be subject to all of the requirements, containedin the following provisions:

 

(a)           Eachgrant shall specify the number of Performance Shares or Performance Units towhich it pertains, which number may be subject to adjustment to reflect changesin compensation or other factors; provided, however, that no such adjustmentshall be made in the case of a Covered Employee.

 

(b)           ThePerformance Period with respect to each Performance Share or Performance Unitshall be such period of time (not less than one year, except in the event of aChange in Control or other similar transaction or event, if the Board shall sodetermine) commencing with the Date of Grant (as shall be determined by theBoard at the time of grant).

 

(c)           Anygrant of Performance Shares or Performance Units shall specify ManagementObjectives that, if achieved, will result in payment or early payment of theaward, and each grant may specify with respect to such specified ManagementObjectives a minimum acceptable level of achievement and shall set forth aformula for determining the number of Performance Shares that will be earned orthe value of Performance Units that will be paid if performance is at or abovethe minimum

 

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level.  The grant of Performance Shares orPerformance Units shall specify that, before the Performance Shares shall beearned or the Performance Units shall be paid, the Board must certify that theManagement Objectives have been satisfied.

 

(d)           Eachgrant shall specify a minimum acceptable level of achievement in respect of thespecified Management Objectives below which no payment will be made and shallset forth a formula for determining the amount of payment to be made ifperformance is at or above such minimum.

 

(e)           Eachgrant shall specify the time and manner of payment of Performance Shares orPerformance Units.  Any grant mayspecify that the amount payable with respect thereto may be paid by theCorporation in cash, in Common Shares or in any combination thereof and mayeither grant to the Participant or retain in the Board the right to elect amongthose alternatives.

 

(f)            Anygrant of Performance Shares may specify that the amount payable with respectthereto may not exceed a maximum specified by the Board at the Date ofGrant.  Any grant of Performance Unitsmay specify that the amount payable or the number of Common Shares issued withrespect thereto may not exceed maximums specified by the Board at the Date ofGrant.

 

(g)           TheBoard may, at or after the Date of Grant of Performance Shares, provide for thepayment of dividend equivalents to the holder thereof on either a current ordeferred or contingent basis, either in cash or in additional Common Shares.

 

(h)           Eachgrant of Performance Shares or Performance Units shall be evidenced by anEvidence of Award containing such other terms and provisions, consistent withthis Plan, as the Board may approve.

 

(i)            Eachgrant of Performance Shares or Performance Units shall be subject to theprovisions of Section 19(g) of this plan.

 

**9.**             **Awards to Non-Employee Directors**.  The Board may, from time to time and uponsuch terms and conditions as it may determine, authorize the granting toNon-Employee Directors of Option Rights and may also authorize the grant orsale of Restricted Shares to Non-Employee Directors.

 

(a)           Eachgrant of Option Rights awarded pursuant to this Section 9 shall be evidenced byan Evidence of Award, and shall be subject to the following additional termsand conditions:

 

(i)            Eachgrant shall specify the number of Common Shares to which it pertains subject tothe limitations set forth in Section 3 of this Plan.

 

(ii)           Eachgrant shall specify an Option Price per share, which shall be set by the Board;provided, however, that such price shall be no less than the par value of ashare of Common stock, and in the case of Incentive Stock Options, such priceshall be not less than the Market Value per Share on the Date of Grant.

 

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(iii)          Each such Option Right shall becomeexercisable as determined by the Board and set forth in the applicable OptionRights Agreement.  Such Option Rightsshall become exercisable in full immediately in the event of a Change inControl. Each such Option Right granted under this Plan shall expire no laterthan ten years from the Date of Grant and shall be subject to earliertermination as hereinafter provided and as set forth in the applicable OptionRights Agreement.

 

(iv)          AnyOption rights may provide that a Director who has completed a specified periodof service on the Board or attained a specified age will be entitled toexercise any such Option Rights immediately in full at any time after any suchtermination until their stated expiration date.

 

(v)           Ifa Non-Employee Director subsequently becomes an employee of the Corporation ora Subsidiary while remaining a member of the Board, any Option Rights heldunder the Plan by such individual at the time of such commencement ofemployment shall not be affected thereby.

 

(vi)          OptionRights may be exercised by a Non-Employee Director only upon payment to theCorporation in full of the Option Price of the Common Shares to bedelivered.  Such payment shall be madein cash or in Common Shares previously owned by the optionee for more than sixmonths, or in a combination of cash and such Common Shares.

 

(vii)         Each grant may provide for the automatic grantof Reload Option Rights to an Optionee upon the exercise of Option Rights(including Reload Option Rights) using Common Shares.  Reload Option Rights shall cover up to the number of CommonShares surrendered to the Corporation upon any such exercise in payment of theOption Price.  Reload Options may havean Option Price that is no less than that which represents the same percentageof the Market Value per Share at the time of exercise of the Option Rights thatthe per share Option Price represented of the Market Value per Share at thetime the Option Rights being exercised were granted and shall be on such otherterms as may be specified by the Directors, which may be the same as ordifferent from those of the original Option Rights.

 

(b)           Eachgrant or sale of Restricted Shares pursuant to this Section 9 shall be uponterms and conditions consistent with Section 6 of this Plan.

 

**10.**          **Transferability**.  

 

(a)           Exceptas otherwise determined by the Board, no Option Right, Appreciation Right orother derivative security granted under the Plan shall be transferable by anOptionee other than by will or the laws of descent and distribution, except (inthe case of a Participant who is not a Director or officer of the Corporation)to a fully revocable trust of which the Optionee is treated as the owner forfederal income tax purposes.  Except asotherwise determined by the Board, Option Rights and Appreciation Rights shallbe exercisable during the Optionee’s lifetime

 

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only by him or her or by his or her guardian or legalrepresentative.  Notwithstanding theforegoing, the Board in its sole discretion, may provide for transferability ofparticular awards under this Plan so long as such provisions will notdisqualify the exemption for other awards under Rule 16b-3.

 

(b)           TheBoard may specify at the Date of Grant that part or all of the Common Sharesthat are (i) to be issued or transferred by the Corporation upon the exerciseof Option Rights or Appreciation Rights, upon the termination of the DeferralPeriod applicable to Deferred Shares or upon payment under any grant ofPerformance Shares or Performance Units or (ii) no longer subject to thesubstantial risk of forfeiture and restrictions on transfer referred to inSection 6 of this Plan, shall be subject to further restrictions on transfer.

 

**11.**          **Adjustments**.  The Board may make or provide for suchadjustments in the numbers of Common Shares covered by outstanding OptionRights, Appreciation Rights, Deferred Shares and Performance Shares grantedhereunder, in the prices per share applicable to such Option Rights andAppreciation Rights and in the kind of shares covered thereby, as the Board, inits sole discretion, exercised in good faith, may determine is equitablyrequired to prevent dilution or enlargement of the rights of Participants or Optioneesthat otherwise would result from (a) any stock dividend, stock split,combination of shares, recapitalization or other change in the capitalstructure of the Corporation or (b) any merger, consolidation, spin-off,split-off, spin-out, split-up, reorganization, partial or complete liquidationor other distribution of assets or issuance of rights or warrants to purchasesecurities or (c) any other corporate transaction or event having an effectsimilar to any of the foregoing. Moreover, in the event of any such transaction or event, the Board, inits discretion, may provide in substitution for any or all outstanding awardsunder this Plan such alternative consideration as it, in good faith, maydetermine to be equitable in the circumstances and may require in connectiontherewith the surrender of all awards so replaced.  The Board may also make or provide for such adjustments in thenumbers of shares specified in Section 3 of this Plan and in the number of OptionRights to be granted automatically pursuant to Section 9 of this Plan as theBoard in its sole discretion, exercised in good faith, may determine isappropriate to reflect any transaction or event described in this Section 11.

 

**12.**          **Change in Control**.  For purposes of this Plan, a “Change in Control”shall mean if at any time any of the following events shall have occurred:

 

(a)           Theacquisition by any individual, entity or group (within the meaning of Section13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the“Exchange Act”)) (a “Person”) of beneficial ownership (within the meaning ofRule 13d-3 promulgated under the Exchange Act) of 50% or more of either:(i) the then-outstanding Common Shares or (ii) the Voting Shares;provided, however, that the following acquisitions shall not constitute aChange in Control: (A) any acquisition directly from the Corporation,(B) any acquisition by the Corporation, (C) any acquisition by anyemployee benefit plan (or related trust) sponsored or maintained by the Corporationor any Subsidiary of the Corporation or (D) any acquisition by any Personpursuant to a transaction that complies with clauses (i), (ii) and (iii) ofSection 12(c) of this Plan; or

 

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(b)           Individualswho, as of the Effective Date, constitute the Board (the “Incumbent Board”)cease for any reason (other than death or disability) to constitute at least amajority of the Board; provided, however, that any individual becoming adirector subsequent to the Effective Date, whose election, or nomination forelection by the Corporation’s stockholders, was approved by a vote of at leasta majority of the directors then comprising the Incumbent Board (either by aspecific vote or by approval of the proxy statement of the Corporation in whichsuch person is named as a nominee for director, without objection to suchnomination) shall be considered as though such individual were a member of theIncumbent Board, but excluding for this purpose, any such individual whoseinitial assumption of office occurs as a result of an actual or threatenedelection contest (within the meaning of Rule 14a-11 of the Exchange Act) withrespect to the election or removal of directors or other actual or threatenedsolicitation of proxies or consents by or on behalf of a Person other than theBoard; provided, further, that Finally Designated Members (asdefined in the Plan of Reorganization) who replace Interim Members (as definedin the Plan of Reorganization) on the Board in accordance with the Plan ofReorganization and Bylaw 10(b) of the Corporation’s Amended and Restated Bylawsshall be considered as though such Finally Designated Members were members ofthe Incumbent Board; or

 

(c)           Consummationof a reorganization, merger or consolidation or sale or other disposition ofall or substantially all of the assets of the Corporation (a “BusinessCombination”), in each case, unless, following such Business Combination,(i) all or substantially all of the individuals and entities who were thebeneficial owners, respectively, of the Common Shares and Voting Sharesimmediately prior to such Business Combination beneficially own, directly orindirectly, more than 50% of, respectively, the then-outstanding shares ofcommon stock and the combined voting power of the then-outstanding votingsecurities entitled to vote generally in the election of directors, as the casemay be, of the entity resulting from such Business Combination (including,without limitation, an entity that as a result of such transaction owns theCorporation or all or substantially all of the Corporation’s assets eitherdirectly or through one or more subsidiaries) in substantially the sameproportions relative to each other as their ownership, immediately prior tosuch Business Combination, of the Common Shares and Voting Shares, as the case maybe, (ii) no Person (excluding any entity resulting from such BusinessCombination or any employee benefit plan (or related trust) sponsored ormaintained by the Corporation or such entity resulting from such BusinessCombination) beneficially owns, directly or indirectly, 15% or more of,respectively, the then-outstanding shares of common stock of the entityresulting from such Business Combination, or the combined voting power of thethen-outstanding voting securities of such corporation except to the extentthat such ownership existed prior to the Business Combination and (iii) atleast a majority of the members of the board of directors of the corporationresulting from such Business Combination were members of the Incumbent Board atthe time of the execution of the initial agreement, or of the action of theBoard providing for such Business Combination; or

 

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(d)           Approvalby the stockholders of the Corporation of a complete liquidation or dissolutionof the Corporation.

 

**13.**          **Fractional Shares**.  The Corporation shall not be required toissue any fractional Common Shares pursuant to this Plan.  The Board may provide for the elimination offractions or for the settlement of fractions in cash.

 

**14.**          **Withholding Taxes**.  To the extent that the Corporation is requiredto withhold federal, state, local or foreign taxes in connection with anypayment made or benefit realized by a Participant or other person under thisPlan, and the amounts available to the Corporation for such withholding areinsufficient, it shall be a condition to the receipt of such payment or therealization of such benefit that the Participant or such other person makearrangements satisfactory to the Corporation for payment of the balance of suchtaxes required to be withheld, which arrangements (in the discretion of theBoard) may include relinquishment of a portion of such benefit.  Participants shall also make sucharrangements as the Corporation may require for the payment of any withholdingtax obligations that may arise in connection with the disposition of sharesacquired upon the execution of Option Rights. In no event, however, shall the Corporation accept Common Shares forpayment of taxes in excess of required tax withholding rates, except that, inthe discretion of the Committee, a Participant or such other person maysurrender Common Shares owned for more than six months to satisfy any taxobligations resulting from any such transaction.

 

**15.**          **Participation by Employees of Designated Subsidiaries**.  As a condition to the effectiveness of anygrant or award to be made hereunder to a Participant who is an employee of aDesignated Subsidiary, whether or not such Participant is also employed by theCorporation or another Subsidiary, the Board may require such DesignatedSubsidiary to agree to transfer to such employee (when, as and if provided forunder this Plan and any applicable agreement entered into with any suchemployee pursuant to this Plan) the Common Shares that would otherwise bedelivered by the Corporation, upon receipt by such Designated Subsidiary of anyconsideration then otherwise payable by such Participant to theCorporation.  Any such award shall beevidenced by an agreement between the Participant and the DesignatedSubsidiary, in lieu of the Corporation, on terms consistent with this Plan andapproved by the Board and such Designated Subsidiary.  All such Common Shares so delivered by or to a DesignatedSubsidiary shall be treated as if they had been delivered by or to the Corporationfor purposes of Section 3 of this Plan, and all references to the Corporationin this Plan shall be deemed to refer to such Designated Subsidiary, except forpurposes of the definition of “Board” and except in other cases where thecontext otherwise requires.

 

**16.**          **Foreign Employees**.  In order to facilitate the making of anygrant or combination of grants under this Plan, the Board may provide for suchspecial terms for awards to Participants who are foreign nationals or who areemployed by the Corporation or any Subsidiary outside of the United States ofAmerica as the Board may consider necessary or appropriate to accommodatedifferences in local law, tax policy or custom. Moreover, the Board may approvesuch supplements to or amendments, restatements or alternative versions of thisPlan as it may consider necessary or appropriate for such purposes, withoutthereby affecting the terms of this Plan as in effect for any other purpose,and the Secretary or other appropriate officer of the Corporation may certifyany such document as having been approved and adopted in the same manner asthis Plan.  No such special terms,supplements, amendments or restatements, however,

 

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shall include any provisions that are inconsistent with the terms ofthis Plan as then in effect unless this Plan could have been amended toeliminate such inconsistency without further approval by the shareholders ofthe Corporation.

 

**17.**          **Administrationof the Plan**.

 

(a)           ThisPlan shall be administered by the Board, which may from time to time delegateall or any part of its authority under this Plan to a committee of the Board(or subcommittee thereof), consisting of not less than three Non-EmployeeDirectors appointed by the Board of Directors, each of whom shall be a“Non-Employee Director” within the meaning of Rule 16b-3 and an “outsidedirector” within the meaning of Section 162(m) of the Code.  A majority of the committee (or subcommitteethereof) shall constitute a quorum, and the action of the members of thecommittee (or subcommittee thereof) present at any meeting at which a quorum ispresent, or acts unanimously approved in writing, shall be the acts of thecommittee (or subcommittee thereof).

 

(b)           Theinterpretation and construction by the Board of any provision of this Plan orof any agreement, notification or document evidencing the grant of OptionRights, Appreciation Rights, Restricted Shares, Deferred Shares, PerformanceShares or Performance Units and any determination by the Board pursuant to anyprovision of this Plan or of any such agreement, notification or document shallbe final and conclusive.  No member ofthe Board shall be liable for any such action or determination made in goodfaith.

 

**18.**          **GoverningLaw**.  The Plan and allawards granted and actions taken thereunder shall be governed by and construed inaccordance with the internal substantive laws of the State of Delaware.

 

**19.**          **Amendments****, Etc**.

 

(a)           TheBoard may at any time and from time to time amend the Plan in whole or in part;provided, however, that any amendment that must be approved by the shareholdersof the Corporation in order to comply with applicable law or the rules of anynational securities exchange upon which the Common Shares are traded or quotedshall not be effective unless and until such approval has been obtained.  Presentation of this Plan or any amendmenthereof for shareholder approval shall not be construed to limit theCorporation’s authority to offer similar or dissimilar benefits in plans thatdo not require shareholder approval.

 

(b)           TheBoard also may permit Participants to elect to defer the issuance of CommonShares or the settlement of awards in cash under the Plan pursuant to suchrules, procedures or programs as it may establish for purposes of thisPlan.  The Board also may provide thatdeferred issuances or settlements include the payment or crediting of dividendequivalents or interest on the deferral amounts.

 

(c)           TheBoard may condition the grant of any award or combination of awards authorizedunder this Plan on the surrender or deferral by the Participant of his or

 

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her right to receive acash bonus or other compensation otherwise payable by the Corporation or aSubsidiary to the Participant.

 

(d)           Incase of termination of employment by reason of death, disability or normal orearly retirement, or in the case of hardship or other special circumstances, ofa Participant who holds an Option Right or Appreciation Right not immediatelyexercisable in full, or any Restricted Shares as to which the substantial riskof forfeiture or the prohibition or restriction on transfer has not lapsed, orany Deferred Shares as to which the Deferral Period has not been completed, orany Performance Shares or Performance Units that have not been fully earned, orwho holds Common Shares subject to any transfer restriction imposed pursuant toSection 10(b) of this Plan, the Board may, in its sole discretion, acceleratethe time at which such Option Right or Appreciation Right may be exercised orthe time at which such substantial risk of forfeiture or prohibition orrestriction on transfer will lapse or the time when such Deferral Period willend or the time at which such Performance Shares or Performance Units will bedeemed to have been fully earned or the time when such transfer restrictionwill terminate or may waive any other limitation or requirement under any suchaward.

 

(e)           ThisPlan shall not confer upon any Participant any right with respect tocontinuance of employment or other service with the Corporation or anySubsidiary, nor shall it interfere in any way with any right the Corporation orany Subsidiary would otherwise have to terminate such Participant’s employmentor other service at any time.

 

(f)            Tothe extent that any provision of this Plan would prevent any Option Right thatwas intended to qualify as an Incentive Stock Option from qualifying as such,that provision shall be null and void with respect to such Option Right.  Such provision, however, shall remain ineffect for other Option Rights and there shall be no further effect on anyprovision of this Plan.

 

(g)           ThisPlan, the awarding and vesting of Appreciation Rights, Deferred Shares, OptionRights, Performance Shares, Performance Units or Restricted Shares under thisPlan and the issuance and delivery of Common Shares and the payment of moneyunder this Plan or under Appreciation Rights, Deferred Shares, Option Rights,Performance Shares, Performance Units or Restricted Shares awarded hereunderare subject to compliance with all applicable federal and state laws, rules andregulations, including (without limitation) state and federal securities lawand federal margin requirements and to such approvals by any listing,regulatory or governmental authority as may, in the opinion of counsel for theCorporation, be necessary or advisable in connection therewith.  Any securities delivered under this Planshall be subject to such restrictions, and the person acquiring such securitiesshall, if requested by the Corporation, provide such assurances andpresentations to the Corporation as the Corporation may deem necessary ordesirable to assure compliance with all applicable legal requirements. To theextent permitted by applicable law, the Plan, Appreciation Rights, DeferredShares, Option rights, Performance shares, Performance Units and RestrictedShares awarded hereunder shall be deemed amended to the extent necessary toconform to such laws, rules and regulations.

 

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**20.**          **Termination**.  No grant (other than an automatic grant ofReload Option Rights) shall be made under this Plan more than ten years afterthe Effective Date, but all grants made on or prior to such date shall continuein effect thereafter subject to the terms thereof and of this Plan.

 

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