exv10w1



 






Exhibit
10.1




STARBUCKS CORPORATION




2005 COMPANY-WIDE SUB-PLAN

TO THE

2005 LONG-TERM EQUITY INCENTIVE PLAN




     1. Purpose. The purposes of this Sub-Plan are (i) to assist in the administration and
implementation of the Starbucks Corporation 2005 Long-Term Equity Incentive Plan (the
“Plan”), by providing additional procedures and guidelines which apply specifically to
Partners, and (ii) to encourage ownership of the Common Stock by all Partners. This Sub-Plan is
intended to provide an incentive for Partners to exert their maximum efforts to achieve the
successful operation of the Company and is intended to assist the Company in attracting and
retaining talented personnel by providing an opportunity to benefit from any increased value of the
Company, to which such Partners and new personnel will have contributed. This Sub-Plan is intended
to link the interests of the Partners with those of the Company’s shareholders. The benefits of
this Sub-Plan are not a substitute for compensation otherwise payable to Partners pursuant to the
terms of their employment.



     2. Definitions. Capitalized terms used without definition in this Sub-Plan shall have
the meanings given such terms in the Plan. To the extent that any term defined herein conflicts
with the definition of such term under the Plan, the definition in this Sub-Plan shall control.



     For purposes of this Sub-Plan:



          (a) “Active Status” shall mean for Partners, the absence of any interruption or
termination of service as a Partner. Active Status shall not be considered interrupted for a
Partner in the case of sick leave, maternity leave, infant care leave, medical emergency leave,
military leave, or any other leave of absence properly taken in accordance with the policies of the
Company or any applicable Subsidiary as may be in effect from time to time. Whenever a mandatory
severance period applies under applicable law with respect to a termination of service as a
Partner, Active Status shall be considered terminated upon such Partner’s receipt of notice of
termination in whatever form prescribed by applicable law.




          (b) “Award” shall mean any award or benefit granted under this Sub-Plan, including
Options, Restricted Stock, and Restricted Stock Units.




          (c) “Award Agreement” shall mean the written or electronic agreement between the
Company and a Partner setting forth the terms of the Award.




          (d) “Base Wages,” with respect to an Eligible Partner, means all gross actual base pay
(including any applicable shift differentials), whether paid or deferred, but not including
overtime, bonuses and commissions, and shall be calculated before deductions for amounts
contributed to Company or Subsidiary benefits and/or long-term savings plans. “Base Wages” does
not include deferred income at payout, any awards payable under any long-term incentive plan to be
adopted by the Company or any Subsidiary, imputed income for life insurance, relocation
reimbursement or similar programs. With respect to the entire Company and the Subsidiaries, “Base
Wages” means the total amount of Base Wages for all Eligible Partners at a particular time under
this Sub-Plan.




          (e) “Beneficial Ownership” shall have the meaning set forth in Rule 13d-3 promulgated
under the Exchange Act.




          (f) “Board” shall mean the Board of Directors of the Company.




          (g) “Change of Control” shall mean the first day that any one or more of the following
conditions shall have been satisfied:




               (i) the sale, liquidation or other disposition of all or substantially all of the
Company’s assets in one or a series of related transactions;



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               (ii) an acquisition (other than directly from the Company) of any outstanding voting
securities by any Person, after which such person (as the term is used for purposes of Section
13(d) or 14(d) of the Exchange Act) has Beneficial Ownership of twenty-five percent (25%) or more
of the then outstanding voting securities of the Company, other than a Board approved transaction;



               (iii) during any 36-consecutive month period, the individuals who, at the beginning
of such period, constitute the Board (“Incumbent Directors”) cease for any reason other
than death to constitute at least a majority of the members of the Board; provided however that
except as set forth in this Section 2(g)(iii), an individual who becomes a member of the Board
subsequent to the beginning of the 36-month period, shall be deemed to have satisfied such 36-month
requirement and shall be deemed an Incumbent Director if such Director was elected by or on the
recommendation of or with the approval of at least two-thirds of the Directors who then qualified
as Incumbent Directors either actually (because they were Directors at the beginning of such
period) or by operation of the provisions of this section; if any such individual initially assumes
office as a result of or in connection with either an actual or threatened solicitation with
respect to the election of Directors (as such terms are used in Rule 14a-12(c) of Regulation 14A
promulgated under the Exchange Act) or other actual or threatened solicitations of proxies or
consents by or on behalf of a Person other than the Board, then such individual shall not be
considered an Incumbent Director; or



               (iv) a merger, consolidation or reorganization of the Company, as a result of which
the shareholders of the Company immediately prior to such merger, consolidation or reorganization
own directly or indirectly immediately following such merger, consolidation or reorganization less
than fifty percent (50%) of the combined voting power of the outstanding voting securities of the
entity resulting from such merger, consolidation or reorganization.



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




          (i) “Committee” shall mean the Compensation and Management Development Committee
appointed by the Board.




          (j) “Common Stock” shall mean the common stock of the Company, par value $0.001 per
share.




          (k) “Company” shall mean Starbucks Corporation, a Washington corporation and any
successor thereto.




          (l) “Director” shall mean a member of the Board.




          (m) “Disability” shall mean (i) in the case of a Partner whose employment with the
Company or a Subsidiary is subject to the terms of an employment or consulting agreement that
includes a definition of disability, “Disability” as used in this Sub-Plan shall have the meaning
set forth in such employment or consulting agreement during the period that such employment or
consulting agreement remains in effect; and (ii) in all other cases, the term “Disability” as used
in this Sub-Plan shall have the same meaning as set forth under the Company’s long-term disability
plan applicable to the Partner as may be amended from time to time, and in the event the Company
does not maintain any such plan with respect to a Partner, a physical or mental condition resulting
from bodily injury, disease or mental disorder which renders the Partner incapable of continuing
his or her usual and customary employment with the Company or a Subsidiary, as the case may be, for
a period of not less than 120 days or such other period as may be required by applicable law.




          (n) “Eligible Partner” shall mean any regular, full-time or part-time Partner who (i)
was a Partner as of April 1 in the fiscal year of the Company prior to the date of the Award grant,
(ii) is a Partner on the date of the Award grant, and (iii) who has been paid for at least 500
hours (which equates to approximately twenty hours per week on average) between April 1 and the
last day of the prior fiscal year or between the first day of the




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prior fiscal year and March 31 of the fiscal year prior to the date of the Award grant.
Officers and members of the Board of Directors of the Company or its Subsidiaries shall not be
eligible to participate in this Sub-Plan.




          (o) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.




          (p) “Fair Market Value” shall mean the closing price per share of the Common Stock on
Nasdaq as to the date specified (or the previous trading day if the date specified is a day on
which no trading occurred), or if Nasdaq shall cease to be the principal exchange or quotation
system upon which the shares of Common Stock are listed or quoted, then such exchange or quotation
system as the Company elects to list or quote its shares of Common Stock and that the Committee
designates as the Company’s principal exchange or quotation system.




          (q) “Family Member” shall include any child, stepchild, grandchild, parent,
stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law,
father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including adoptive
relationships, any person sharing a Partner’s household (other than a tenant or an employee), a
trust in which these persons have more than fifty percent (50%) of the beneficial interest, a
foundation in which these persons (or a Partner) control the management of assets, and any other
entity in which these persons (or a Partner) own more than fifty percent (50%) of the voting
interests.




          (r) “Misconduct” with respect to a Partner shall mean any of the following:




               (i) any material breach of an agreement between the Partner and the Company or any
Subsidiary which, if curable, has not been cured within twenty (20) days after the Partner has been
given written notice of the need to cure such breach, or which breach, if previously cured, recurs;



               (ii) any willful unauthorized use or disclosure of confidential information or trade
secrets of the Company or any Subsidiary by the Partner;



               (iii) the Partner’s continued willful and intentional failure to satisfactorily
perform Partner’s essential responsibilities, provided that the Partner has been given at least
thirty (30) days’ written notice of the need to cure the failure and cure has not been effected
within that time period, or which failure, if previously cured, recurs;



               (iv) any material failure of the Partner to comply with rules, policies or
procedures of the Company or any Subsidiary as they may be amended from time to time, provided that
the Partner has been given at least thirty (30) days’ written notice of the need to cure the
failure, if such failure is curable, and cure has not been effected within that time period, or
which failure, if previously cured, recurs;



               (v) the Partner’s dishonesty, fraud or gross negligence related to the business or
property of the Company or any Subsidiary;



               (vi) personal conduct that is materially detrimental to the business of the Company
or any Subsidiary; or



               (vii) conviction of or plea of nolo contendere to a felony.



          (s) “Nasdaq” shall mean The Nasdaq Stock Market, Inc.




          (t) “Nonqualified Stock Option” shall mean an Option that does not qualify or is not
intended to qualify as an incentive stock option under Section 422 of the Code.




          (u) “Officer” shall mean a Partner serving in a position of vice president or higher
of the Company.




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          (v) “Option” shall mean a Nonqualified Stock Option granted pursuant to this Sub-Plan;
no Option granted under this Sub-Plan shall be an incentive stock option within the meaning of
Section 422 of the Code.




          (w) “Optionee” shall mean a Partner who has been granted an Option.




          (x) “Partner” shall mean any Person who is a common law employee of, receives
remuneration for personal services to, is reflected on the official human resources database as an
employee of, and is on the payroll of the Company or any Subsidiary. A Person is on the payroll if
he or she is paid from or at the direction of the payroll department of the Company, or any
Subsidiary. Persons providing services to the Company, or to any Subsidiary, pursuant to an
agreement with a staff leasing organization, temporary workers engaged through or employed by
temporary or leasing agencies, and workers who hold themselves out to the Company or a Subsidiary
to which they are providing services as being independent contractors, or as being employed by or
engaged through another company while providing the services, and Persons covered by a collective
bargaining agreement (unless the collective bargaining agreement applicable to the Person
specifically provides for participation in this Sub-Plan) are not Partners for purposes of this
Sub-Plan and do not and cannot participate in this Sub-Plan, whether or not such Persons are, or
may be reclassified by the courts, the U.S. Internal Revenue Service, the U. S. Department of
Labor, or other Person as, common law employees of the Company, or any Subsidiary, either solely or
jointly with another Person.




          (y) “Person” shall mean a natural person, company, government or political
subdivision, agency or instrumentality of a government.




          (z) “Plan” shall mean the Starbucks Corporation 2005 Long-Term Equity Incentive Plan.




          (aa) “Reprice” shall mean the adjustment or amendment of the exercise price of Options
previously awarded, whether through amendment, cancellation, replacement of grant or any other
means.




          (bb) “Resignation (or Resign) for Good Reason” shall mean any voluntary termination by
written resignation of the Active Status of any Partner after a Change of Control because of: (1) a
material reduction in the Partner’s authority, responsibilities or scope of employment; (2) an
assignment of duties to the Partner inconsistent with the Partner’s role at the Company or
Subsidiary prior to the Change of Control; (3) a reduction in the Partner’s base salary or total
incentive compensation; (4) a material reduction in the Partner’s benefits, unless such reduction
applies to all Partners of comparable rank; or (5) the relocation of the Partner’s primary work
location more than fifty (50) miles from the Partner’s primary work location prior to the Change of
Control; provided that the Partner’s written notice of voluntary resignation must be tendered
within one (1) year after the Change of Control, and shall specify which of the events described in
clauses (1) through (5) above resulted in the resignation.




          (cc) “Restricted Stock” shall mean a grant of Shares pursuant to this Sub-Plan.




          (dd) “Restricted Stock Units” shall mean a grant of the right to receive Shares in the
future or their cash equivalent (or both) pursuant to this Sub-Plan and may be paid in Shares,
their cash equivalent or both.




          (ee) “Retirement” shall mean, with respect to any Partner, voluntary termination of
employment after attainment of age fifty-five (55) and at least ten (10) years of credited service
with the Company or any Subsidiary (but only during the time the Subsidiary was a Subsidiary), as
determined by the Committee in its sole discretion.




          (ff) “Share” shall mean one share of Common Stock, as adjusted in accordance with
Section 6 of this Sub-Plan.




          (gg) “Sub-Plan” means this Starbucks Corporation 2005 Company-Wide Sub-Plan to the
Plan, including any country-specific rules approved and adopted by the Committee, as such plan and
country-specific rules may be amended and restated from time to time.




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          (hh) “Subsidiary” shall mean, with respect to the Company, a “subsidiary corporation,”
whether now or hereafter existing, as defined in Section 424(f) of the Code and in addition (1) a
limited liability company, partnership or other entity in which the Company controls fifty percent
(50%) or more of the voting power or equity interests, or (2) an entity with respect to which the
Company possesses the power, directly or indirectly, to direct or cause the direction of the
management and policies of that entity, whether through the Company’s ownership of voting
securities, by contract or otherwise.




     3. Administration of this Sub-Plan.



          (a) Committee. This Sub-Plan shall be administered by the Committee, subject to such
terms and conditions as the Committee may prescribe; provided that they are consistent with the
terms of the Plan. Notwithstanding anything herein to the contrary, the Committee’s power to
administer this Sub-Plan, and actions the Committee takes under this Sub-Plan, shall be limited by
the provisions set forth in the Committee’s charter, as such charter may be amended from time to
time, and the further limitation that certain actions may be subject to review and approval by
either the full Board or a panel consisting of all of the Independent Directors of the Company.




          (b) Authority; Powers. Subject to the express terms and conditions set forth herein
and the Plan, the Committee shall have the discretion from time to time:




               (i) to grant Options, Restricted Stock, or Restricted Stock Units to Partners and to
determine the terms and conditions of such Awards, including the determination of the Fair Market
Value of the Shares and the exercise price, and to modify or amend each Award, with the consent of
the Partner when required;



               (ii) to determine the Partners to whom Awards, if any, will be granted hereunder,
the timing of such Awards, and the number of Shares to be represented by each Award;



               (iii) to construe and interpret this Sub-Plan and the Awards granted hereunder;



               (iv) to prescribe, amend, and rescind rules and regulations relating to this
Sub-Plan or to any sub-plan established under this Sub-Plan, including the form of Award Agreement,
and manner of acceptance of an Award, such as correcting a defect or supplying any omission, or
reconciling any inconsistency so that this Sub-Plan, any sub-plan established under this Sub-Plan
or any Award Agreement complies with applicable law regulations and listing requirements and to
avoid unanticipated consequences deemed by the Committee to be inconsistent with the purposes of
this Sub-Plan, any sub-plan established under this Sub-Plan or any Award Agreement;



               (v) to establish performance criteria (as defined in Section 11(b) of the Plan) for
Awards made pursuant to this Sub-Plan or to any sub-plan established under this Sub-Plan in
accordance with a methodology established by the Committee, and to determine whether performance
goals have been attained;



               (vi) to accelerate or defer (with the consent of the Partner) the exercise or vested
date of any Award;



               (vii) to authorize any Person to execute on behalf of the Company any instrument
required to effectuate the grant of an Award previously granted by the Committee;



               (viii) to establish sub-plans, procedures, or guidelines for the grant of Awards to
Eligible Partners;



               (ix) to make all other determinations deemed necessary or advisable for the
administration of this Sub-Plan or any sub-plan established under this Sub-Plan;



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Provided that, no consent of a Partner is necessary under clauses (i) or (vi) if a modification,
amendment, acceleration, or deferral, in the reasonable judgment of the Committee, confers a
benefit on the Partner or is made pursuant to an adjustment in accordance with Section 6.




          (c) Effect of Committee’s Decision. All decisions, determinations, and
interpretations of the Committee shall be final and binding on all Partners, the Company (including
the Subsidiaries), any shareholder and all other Persons.




          (d) Delegation. Notwithstanding anything to the contrary set forth in the Plan,
unless otherwise determined by the Board from time to time, the Committee may not delegate the
ability to grant any Awards pursuant to this Sub-Plan.




     4. Maximum Annual Option Grant. The Shares issued under this Sub-Plan are Shares
reserved for issuance under the Plan. The maximum number of Options an Eligible Partner may
receive in any fiscal year of the Company may not exceed that number of Options to purchase Shares
having an aggregate Fair Market Value on the date of grant equal to fourteen percent (14%) of such
Eligible Partner’s Base Wages for the previous fiscal year. Notwithstanding the foregoing, the
Committee, in its sole discretion, may increase the maximum value of shares subject to Awards set
forth in the prior sentence from time to time. Upon a change in capitalization, the number of
Shares referred to in the first sentence of this Section 4 shall be adjusted pursuant to Section 6.



     5. Procedure for Exercise of Awards; Rights as a Shareholder.



          (a) Procedure. An Award shall be exercised when written, electronic or verbal notice
of exercise has been given to the Company, or the brokerage firm or firms approved by the Company
to facilitate exercises and sales under this Sub-Plan, in accordance with the terms of the Award by
the Person entitled to exercise the Award and full payment for the Shares with respect to which the
Award is exercised has been received by the Company or the brokerage firm or firms, as applicable.
The notification to the brokerage firm shall be made in accordance with procedures of such
brokerage firm approved by the Company. Full payment may, as authorized by the Committee, consist
of any consideration and method of payment allowable under Section 5(b) of this Sub-Plan. The
Company shall issue (or cause to be issued) such share certificate promptly upon exercise of the
Award. No adjustment will be made for a dividend or other right for which the record date is prior
to the date the share certificate is issued, except as provided in Section 6 of this Sub-Plan.




          (b) Method of Payment. The permissible methods of payment of consideration for any
Shares to be issued upon exercise or other required settlement of an Award shall be: (i) with
respect to an Option, a request that the Company or the designated brokerage firm conduct a
cashless exercise of the Option; and (ii) cash. Notwithstanding anything to the contrary contained
in the Plan, payment of the aggregate exercise price of Options by means of tendering previously
owned shares of Common Stock shall not be permitted.




          (c) Withholding Obligations. To the extent required by applicable federal, state,
local or foreign law, the Committee may and/or a Partner shall make arrangements satisfactory to
the Company for the satisfaction of any withholding tax obligations that arise with respect to any
Option, Restricted Stock or Restricted Stock Units, or any sale of Shares. The Company shall not
be required to issue Shares or to recognize the disposition of such Shares until such obligations
are satisfied. These obligations may be satisfied by having the Company withhold a portion of the
Shares that otherwise would be issued to a Partner under such Award, such withholding to be done at
the minimum tax rate required by applicable law. Notwithstanding anything to the contrary contained
in the Plan, the satisfaction of these obligations by tendering previously owned shares of Common
Stock shall not be permitted.




          (d) Shareholder Rights. Except as otherwise provided in this Sub-Plan, until the
issuance (as evidenced by the appropriate entry on the books of the Company or of a duly authorized
transfer agent of the Company) of the share certificate evidencing such Shares, no right to vote or
receive dividends or any other rights as a shareholder shall exist with respect to the Shares
subject to the Award, notwithstanding the exercise of the Award.




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          (e) Non-Transferability of Awards. An Award may not be sold, pledged, assigned,
hypothecated, transferred, or disposed of in exchange for consideration, except that an Award may
be transferred (i) by will, or by the laws of descent or distribution applicable to, a deceased
Partner, and/or (ii) pursuant to a domestic relations order.




     6. Adjustments to Shares Subject to this Sub-Plan. If any change is made to the
Shares by reason of any stock split, stock dividend, recapitalization, combination of shares,
exchange of shares or other change affecting the outstanding Shares as a class without the
Company’s receipt of consideration, appropriate adjustments shall be made to the number of Shares
which are subject to outstanding Awards under this Sub-Plan. The Committee may also make
adjustments described in the previous sentence in the event of any distribution of assets to
shareholders other than a normal cash dividend. In determining adjustments to be made under this
Section 6, the Committee may take into account such factors as it deems appropriate, including the
restrictions of applicable law and the potential tax consequences of an adjustment, and in light of
such factors may make adjustments that are not uniform or proportionate among outstanding Awards.
Adjustments, if any, and any determinations or interpretations, including any determination of
whether a distribution is other than a normal cash dividend, made by the Committee shall be final,
binding and conclusive. For purposes of this Section 6, conversion of any convertible securities
of the Company shall not be deemed to have been “effected without receipt of consideration.”



     7. Expiration of Awards.



          (a) Expiration, Termination or Forfeiture of Awards. Unless otherwise provided in the
applicable Award Agreement or any severance agreement, vested Awards granted under this Sub-Plan
shall expire, terminate, or otherwise be forfeited as follows:




               (i) ninety (90) days after the date of termination of a Partner’s Active Status, other than in
circumstances covered by (ii), (iii), (iv) or (v) below;



               (ii) immediately upon termination of a Partner’s Active Status for Misconduct;



               (iii) twelve (12) months after the date on which a Partner ceased performing services as a
result of his or her total and permanent Disability;



               (iv) twelve (12) months after the date of the death of a Partner whose Active Status
terminated as a result of his or her death; and



               (v) thirty-six (36) months after the date on which the Partner ceased performing services as a
result of Retirement.



          (b) Extension of Term. Notwithstanding subsection (a) above, the Committee shall have
the authority to extend the expiration date of any outstanding Option in circumstances in which it
deems such action to be appropriate (provided that no such extension shall extend the term of an
Option beyond the date on which the Option would have expired if no termination of the Partner’s
Active Status had occurred).




     8. Effect of Change of Control. Notwithstanding any other provision in this Sub-Plan
or the Plan to the contrary, the following provisions shall apply unless otherwise provided in the
most recently executed agreement between the Partner and the Company, or specifically prohibited
under applicable laws, or by the rules and regulations of any applicable governmental agencies or
national securities exchanges or quotation systems.



          (a) Acceleration. Awards of a Partner shall be Accelerated (as defined in Section 8(b)
below) as follows:




               (i) With respect to any Partner, upon the occurrence of a Change of Control
described in Section 2(g)(i);



               (ii) With respect to any Partner who Resigns for Good Reason or whose Active Status
is terminated within one year after a Change of Control described in Section 2(g)(ii), (iii) or
(iv); and



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               (iii) With respect to any Partner, notwithstanding Section 8(a)(ii) above, upon the
occurrence of a Change of Control described in Section 2(g)(iv), but only if in connection with
such Change of Control each Award is not assumed or an equivalent award substituted by such
successor entity or a parent or subsidiary of such successor entity.



          (b) Definition. For purposes of this Section 8, Awards of a Partner being
“Accelerated” means, with respect to such Partner:




               (i) any and all Options shall become fully vested and immediately exercisable, and shall
remain exercisable throughout their entire term;



               (ii) any restriction periods and restrictions imposed on Restricted Stock or Restricted Stock
Units that are not performance-based shall lapse; and



               (iii) the restrictions and deferral limitations and other conditions applicable to any other
Awards shall lapse, and such other Awards shall become free of all restrictions, limitations or
conditions and become fully vested and transferable to the full extent of the original grant.



     9. Grant, Terms and Conditions of Options.



          (a) Designation. Each Option shall be designated in an Award Agreement as a
Nonqualified Stock Option.




          (b) Terms of Options. The terms of all Options shall be at the discretion of the
Committee.




          (c) Option Exercise Prices.




               (i) The per Share exercise price under an Option shall be no less than one hundred
percent (100%) of the Fair Market Value per Share on the date of grant.



               (ii) In no event shall the Board or the Committee be permitted to Reprice an Option
after the date of grant without shareholder approval.



          (d) Vesting. Subject to Section 8 and unless otherwise approved by the Committee,
each Option granted under this Sub-Plan shall vest and/or become exercisable in annual twenty-five
percent (25%) installments commencing on the first anniversary of the date of grant. To the extent
not exercised, installments shall accumulate and be exercisable, in whole or in part, at any time
after becoming exercisable, but not later than the date the Options expire. To the extent Options
vest and become exercisable in increments, such Options shall cease vesting as of the date of the
Optionee’s Disability or termination of such Optionee’s Active Status for reasons other than
Retirement or death. In case of such Optionee’s Retirement or death, such Options shall become
fully vested and immediately exercisable.




          (e) Exercise. Any Option granted hereunder shall be exercisable at such times and
under such conditions as determined by the Committee at the time of grant, and as are permissible
under the terms of this Sub-Plan. An Option may not be exercised for a fraction of a Share.




     10. Grant, Terms and Conditions of Stock Awards.



          (a) Designation. Restricted Stock or Restricted Stock Units may be granted either
alone, in addition to, or in tandem with other Awards granted under this Sub-Plan. Restricted
Stock or Restricted Stock Units may include a dividend equivalent right, as permitted by Section 6.
After the Committee determines that it will offer Restricted Stock or Restricted Stock Units, it
will advise the Partner in writing or electronically, by means of an Award Agreement, of the terms,
conditions and restrictions, including vesting, if any, related to the offer, including the number
of Shares that the Partner shall be entitled to receive or purchase, the price to be paid, if any,
and, if




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applicable, the time within which the Partner must accept the offer. The offer shall be
accepted by execution of an Award Agreement or as otherwise directed by the Committee. Restricted
Stock Units may be paid as permitted by Section 5(b). The term of each award of Restricted Stock
or Restricted Stock Units shall be at the discretion of the Committee.




          (b) Performance Criteria. Restricted Stock and Restricted Stock Units granted
pursuant to this Sub-Plan that are intended to qualify as “performance based compensation” under
Section 162(m) of the Code shall be subject to the attainment of performance goals relating to the
Performance Criteria selected by the Committee and specified at the time such Restricted Stock and
Restricted Stock Units are granted.




          (c) Vesting. Subject to Section 8 and unless otherwise approved by the Committee,
Restricted Stock or Restricted Stock Units granted under this Sub-Plan shall vest in annual
twenty-five percent (25%) installments commencing on the first anniversary of the date of grant.
Unless the Committee determines otherwise, the Award Agreement shall provide for the forfeiture of
the non-vested Shares underlying Restricted Stock or Restricted Stock Units upon the termination of
a Partner’s Active Status. To the extent that the Partner purchased the Shares granted under such
Restricted Stock or Restricted Stock Units and any such Shares remain non-vested at the time the
Partner’s Active Status terminates, the termination of Active Status shall cause an immediate sale
of such non-vested Shares to the Company at the original price per Share paid by the Partner.




     11. Termination and Amendment of this Sub-Plan. This Sub-Plan shall terminate on the
date of termination of the Plan and no Award may be granted pursuant to this Sub-Plan thereafter.
The Committee may at any time and from time to time amend, modify or suspend this Sub-Plan and all
administrative rules, regulations and practices; provided, however, that no such amendment,
modification, suspension or termination shall impair or adversely alter any Awards theretofore
granted under this Sub-Plan, except with the consent of the Partner, nor shall any amendment,
modification, suspension or termination deprive any Partner of any Shares that he or she may have
acquired through or as a result of this Sub-Plan.



     12. Non-Exclusivity of this Sub-Plan. The adoption of this Sub-Plan by the Committee
shall not be construed as amending, modifying or rescinding the Plan but is intended to serve as a
framework for the Committee with respect to grants of Awards to Eligible Partners.



     13. Partners in Foreign Countries. Without amending this Sub-Plan, the Committee may
grant Awards to Partners who are foreign nationals on such terms and conditions different from
those specified in this Sub-Plan to achieve the purposes of this Sub-Plan. In furtherance of such
purposes, the Committee may make such modifications to this Sub-Plan as may be necessary or
advisable to comply with the provisions of the laws in other countries in which the Company or any
Subsidiary operates or has employees.



     14. Multiple Award Grants. The terms of each Award grant may differ from other Awards
granted under this Sub-Plan at another time. The Committee may also make more than one grant of
Awards to a given Eligible Partner during the term of this Sub-Plan.



(Approved by the Compensation and Management Development Committee of the Board of Directors on May
3, 2005)





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