1

 
     **“Board”** means the Board of Directors of the Corporation.     **“Black-Scholes Value”** means the formula given by the option pricing model of such name used tocalculate the theoretical fair value of a stock option at any given time.     **“Change in Control”** means, unless otherwise defined by the Committee, a change in control of anature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation14A promulgated under the Securities Exchange Act of 1934, as amended, whether or not theCorporation is then subject to such reporting requirement; provided, that, without limitation, sucha change in control shall be deemed to have occurred if:     (i) a third person, including a “Group” as defined in Section 13(d)(3) of theExchange Act, becomes the beneficial owner of Common Stock having fifty (50) percentor more of total number of votes that may be cast for the election of Directors; or     (ii) as a result of, or in connection with, a contested election for Directors,persons who were Directors immediately before such election shall cease toconstitute a majority of the Board;provided, however, that no Change in Control shall be deemed to have occurred with respect toparagraph 10 unless such event constitutes an event specified in Code Section 409A(a)(2)(A)(v) andthe Treasury Regulations and other guidance issued under or related to Section 409A of the Code.     **“Code”** means the Internal Revenue Code of 1986, as amended from time to time.     **“Code Section 409A”**means Section 409A of the Code and all applicable regulations and otherguidance issued under or related to Section 409A of the Code.     **“Committee”** means the independent Compensation Committee of the Board as is designated by theBoard to administer the Plan.     **“Common Stock”** means Centex Corporation common stock, par value $.25 per share.     **“Corporation”** means Centex Corporation, a Nevada corporation, or any successor thereto.     **“Director”** means an individual who is a member of the Board.     **“Director Award”** means any Option, Stock Award or Performance Award granted, whether singly,in combination or in tandem, to a Participant who is a Non-employee Director pursuant to suchapplicable terms, conditions and limitations (including treatment as a Performance Award) as theCommittee may establish in order to fulfill the objectives of the Plan.     **“Disability”** means a disability determination in accordance with the terms of the Long TermDisability Plan of Centex Corporation, provided that with respect to Awards that are subject toCode Section 409A, the Participant also must meet one of the following conditions:     (a) the Participant is unable to engage in any substantial gainful activity by reasonof a medically determinable physical or mental impairment that can be expected to result indeath or can be expected to last for a continuous period of not less than 12 months; or     (b) the Participant is, by reason of any medically determinable physical or mentalimpairment that can be expected to result in death or can be expected to last for acontinuous
2

 
period of not less than 12 months, receiving income replacement benefits for a periodof not less than three months under an accident and health plan covering employees of theParticipant’s Employer.     **“Dividend Equivalents”** means, with respect to Stock Units or shares of Restricted Stock thatare to be issued at the end of the Restriction Period, an amount equal to all dividends and otherdistributions (or the economic equivalent thereof) that are payable to stockholders of recordduring the Restriction Period on a like number of shares of Common Stock.     **“Employee”** means an employee of the Corporation or any of its Affiliates.     **“Employee Award”** means any Option, Stock Award, or Performance Award granted, whether singly,in combination or in tandem, to a Participant who is an Employee pursuant to such applicable terms,conditions and limitations (including treatment as a Performance Award) as the Committee mayestablish in order to fulfill the objectives of the Plan.     **“Employee Director”** means an individual serving as a member of the Board who is an Employee ofthe Corporation or any of its Affiliates.     **“Employer”** means the Corporation and any Affiliate.     **“Equity Award”** means any Option, Stock Award, or Performance Award (other than a PerformanceAward denominated in cash) granted to a Participant under the Plan.     **“Exchange Act”** means the Securities Exchange Act of 1934, as amended.     **“Fair Market Value”** of a share of Common Stock means, as of a particular date, (i)(A) ifCommon Stock is listed on a national securities exchange, the closing price per share of suchCommon Stock, as reported on the consolidated transaction reporting system for the New York StockExchange or such other national securities exchange on which the Common Stock is listed that is atthe applicable time the principal market for the Common Stock, or any other source selected by theCommittee, or, if there shall have been no such sales so reported on that date, on the lastpreceding date on which such a sale was so reported, (B) if Common Stock is not so listed, the meanbetween the closing bid and asked price of Common Stock on that date, or, if there are noquotations available for such date, on the last preceding date on which such a quotation wasreported, as reported on a recognized quotation system selected by the Committee, or, if not soreported, then as reported by The Pink Sheets LLC (or a similar organization or agency succeedingto its functions of reporting prices), or (C) if Common Stock is not publicly traded, the mostrecent value determined by an independent appraiser appointed by the Corporation for such purpose,or (ii) if applicable, the price per share as determined in accordance with the procedures of athird party administrator retained by the Corporation to administer the Plan. Any determination ofFair Market Value shall be consistent with Code Section 409A to the extent applicable.     **“Family Member”** means a Participant’s spouse and any parent, stepparent, grandparent, child,stepchild or grandchild of the Participant, including adoptive relationships, or a trust, familylimited partnership or any other entity in which these persons (with or without the Participant)have more than 50% of the beneficial interest.     **“Full Time Employee”** means a person actively and regularly engaged in work at least 40 hours aweek.
3

 
     **“Grandfathered Awards”** means all Awards made pursuant to the Plan that were earned and vestedon or before December 31, 2004. Grandfathered Awards are subject to the provisions of paragraph2(b).     **“Grant Date”** means the date an Award is granted to a Participant pursuant to the Plan. TheGrant Date for a substituted award is the Grant Date of the original award.     **“Grant Price”** means the price at which a Participant may exercise his or her right to receivecash or Common Stock, as applicable, under the terms of an Award.     **“Joint Venture”** means any joint venture, partnership, limited liability company or othernon-corporate entity in which the Corporation has at least a 50% ownership, voting, capital orprofits interests (in whatever form).     **“Non-employee Director”** means an individual serving as a member of the Board who is not anEmployee of the Corporation or any of its Affiliates.     **“Option”** means a right to purchase a specified number of shares of Common Stock at a specifiedGrant Price, which is not intended to comply with the requirements set forth in Section 422 of theCode.     **“Participant”** means an Employee or Non-employee Director to whom an Award has been grantedunder this Plan.     **“Performance Award”** means an Award made pursuant to this Plan that is subject to theattainment in the future of one or more Performance Goals.     **“Performance Goal”** means a standard established by the Committee, to determine in whole or inpart whether a Qualified Performance Award shall be earned.     **“Qualified Performance Award”** means a Performance Award made to a Participant who is anEmployee that is intended to qualify as qualified performance-based compensation under Section162(m) of the Code, as described in paragraph 8(a)(iii)(B) of the Plan.     **“Restricted Stock”** means Common Stock that is restricted or subject to forfeiture provisions.     **“Restriction Period”** means a period of time beginning as of the Grant Date of an Award ofRestricted Stock and ending as of the date upon which the Common Stock subject to such Award is nolonger restricted or subject to forfeiture provisions.     **“Retirement”** means the Participant’s voluntary Separation from Service and, where the contextindicates, includes Vested Retirement. Calculation of eligibility for Retirement shall be based onwhole Years of Service on the date as of which the calculation is being made. Any partial yearsshall be disregarded.     **“Separation from Service”**means a termination of services provided by a Participant to his orher Employer (as defined below), whether voluntarily or involuntarily, as determined by theCommittee in accordance with Treasury Regulation § 1.409A-1(h). In determining whether aParticipant has incurred a Separation from Service, the following provisions shall apply:     (a) For a Participant who provides services to an Employer as an employee, except asotherwise provided in this definition, a Separation from Service will occur when suchParticipant has experienced a termination of employment with the Employer. A Participantwill be considered to have experienced a termination of employment when the facts and
4

 
circumstances indicate that the Participant and his or her Employer reasonablyanticipate that either (A) no further services will be performed for the Employer after acertain date, or (B) that the level of bona fide services the Participant will perform forthe Employer after such date (whether as an employee or as an independent contractor) willpermanently decrease to no more than 331/3 percent of the average level of bona fide servicesperformed by the Participant (whether as an employee or an independent contractor) over theimmediately preceding 36-month period (or the full period of services to the Employer if theParticipant has been providing services to the Employer less than 36 months).     If a Participant is on military leave, sick leave, or other bona fide leave of absence,the employment relationship between the Participant and the Employer will be treated ascontinuing, provided that the period of the leave of absence does not exceed 6 months, or iflonger, so long as the Participant has a right to reemployment with the Employer under anapplicable statute or by contract. If the period of a military leave, sick leave, or otherbona fide leave of absence exceeds 6 months and the Participant does not have a right toreemployment under an applicable statute or by contract, the employment relationship will beconsidered to be terminated for purposes of this Plan as of the first day immediatelyfollowing the end of such 6-month period. In applying the provisions of this paragraph, aleave of absence will be considered a bona fide leave of absence only if there is areasonable expectation that the Participant will return to perform services for theEmployer.     (b) For a Participant who provides services to an Employer as an independentcontractor, except as otherwise provided in this definition, a Separation from Service willoccur upon the expiration of the contract (or in the case of more than one contract, allcontracts) under which services are performed for the Employer, provided that the expirationof such contract or contracts is determined by the Committee to constitute a good-faith andcomplete termination of the contractual relationship between the Participant and theEmployer.     (c) For a Participant who provides services to an Employer as both an employee and anindependent contractor*,*a Separation from Service generally will not occur until theParticipant has ceased providing services for the Employer as both as an employee and as anindependent contractor, as determined in accordance with the provisions set forth insubparagraphs (a) and (b) of this definition, respectively. If a Participant either (i)ceases providing services for an Employer as an independent contractor and begins providingservices for such Employer as an employee, or (ii) ceases providing services for an Employeras an employee and begins providing services for such Employer as an independent contractor,the Participant will not be considered to have experienced a Separation from Service untilthe Participant has ceased providing services for the Employer in both capacities, asdetermined in accordance with the applicable provisions set forth in subparagraphs (a) and(b) of this definition.     Notwithstanding the foregoing provisions in this subparagraph (c), if a Participantprovides services for an Employer as both an employee and as a member of the board ofdirectors of an Employer, to the extent permitted by Treasury Regulation § 1.409A-1(h)(5),the services provided by the Participant as a director will not be taken into account indetermining whether the Participant has experienced a Separation from Service as anemployee, and the services provided by the Participant as an employee will not be taken intoaccount in determining whether the Participant has experienced a Separation from Service asa director.     (d) In addition, notwithstanding the provisions of this definition, where as part of asale or other disposition of substantial assets by an Employer to an unrelated buyer, aParticipant would otherwise experience a Separation from Service as defined above, theEmployer and the
5

 
buyer shall retain the discretion to specify, and may specify, that a Participantperforming services for an Employer immediately before the asset purchase transaction andproviding services to the buyer after and in connection with the asset purchase transactionshall not experience a Separation from Service for purposes of this Plan and the Participantshall be bound by same, provided that such transaction and the specification meet therequirements of Code Section 409A.     (e) For purposes of this definition, “Employer” means:     (i) The entity for whom the Participant performs services and with respect towhich the legally binding right to an Award or payment under an Award arises; and     (ii) All other entities with which the entity described in subparagraph (e)(i)of this definition would be aggregated and treated as a single employer under CodeSection 414(b) (controlled group of corporations) and Code Section 414(c) (group oftrades or businesses under common control), as applicable. To identify the group ofentities described in the preceding sentence, an ownership threshold of 50% shall beused as a substitute for the 80% minimum ownership threshold that appears in, andotherwise must be used when applying, the applicable provisions of (A) Code Section1563 and the regulations thereunder for determining a controlled group ofcorporations under Code Section 414(b), and (B) Treasury Regulation § 1.414(c)-2 fordetermining the trades or businesses that are under common control under CodeSection 414(c).     **“Specified Employee”**means any Participant who is determined to be a “key employee” (asdefined under Code Section 416(i) without regard to paragraph (5) thereof) for the applicableperiod, as determined by the Corporation in accordance with Treasury Regulation § 1.409A-1(i).     **“Stock Award”** means an Award in the form of shares of Common Stock or Stock Units, includingan award of Restricted Stock.     **“Stock Unit”** means a unit equal to one share of Common Stock (as determined by the Committee)granted to either an Employee or a Non-employee Director.     **“Subsidiary”** means any corporation of which the Corporation directly or indirectly owns sharesrepresenting 50% or more of the combined voting power of the shares of all classes or series ofcapital stock of such corporation which have the right to vote generally on matters submitted to avote of the stockholders of such corporation.     **“Vested Retirement”** means the voluntary termination of all employment by a Participant(excluding a Non-employee Director) who is a Full Time Employee from the Employer at any time afterthe Participant is age 55 or older, has at least 10 Years of Service and the sum of age and Yearsof Service equals at least 70. Calculation of eligibility for Vested Retirement shall be based onwhole years of age and Years of Service on the date as of which the calculation is being made. Anypartial years shall be disregarded.     **“Years of Service”** means the Participant’s years of employment with an Employer. AParticipant shall be credited with a Year of Service on each anniversary of the date on which he orshe was first employed with an Employer, provided that the Participant continues to be employed byan Employer on such anniversary date.
6

 
**4. Eligibility**     (a) *Employees*. Employees eligible for the grant of Employee Awards under this Plan are thoseEmployee Directors and Employees who hold positions of responsibility and whose performance, in thejudgment of the Committee, can have a significant effect on the success of the Corporation and itsAffiliates. Notwithstanding the foregoing, Employees of Affiliates that are not considered asingle employer with the Corporation under Code Section 414(b) or Code Section 414(c) shall not beeligible to receive Employee Awards that are subject to Code Section 409A until the Affiliateadopts this Plan as a participating employer in accordance with paragraph 23.     (b) *Directors.*Members of the Board eligible for the grant of Director Awards under this Planare those who are Non-employee Directors.**5. Common Stock Available for Awards**     Subject to the provisions of paragraph 15 hereof, no Award shall be granted if it shall resultin the aggregate number of shares of Common Stock issued under the Plan plus the number of sharesof Common Stock covered by or subject to Awards then outstanding (after giving effect to the grantof the Award in question) to exceed 6,665,970 shares. No more than 2,221,990 shares of CommonStock shall be available for Stock Awards, other than Options or Performance Awards. The number ofshares of Common Stock that are the subject of Awards under this Plan that are forfeited orterminated, expire unexercised, are settled in cash in lieu of Common Stock or in a manner suchthat all or some of the shares covered by an Award are not issued to a Participant or are exchangedfor Awards that do not involve Common Stock, shall again immediately become available for Awardshereunder. If the Grant Price or other purchase price of any Option or other Award granted underthe Plan is satisfied by tendering shares of Common Stock to the Corporation by either actualdelivery or by attestation, or by withholding shares of Common Stock, or if the tax withholdingobligation resulting from the settlement of any such Option or other Award is satisfied bytendering or withholding shares of Common Stock, only the number of shares of Common Stock issuednet of the shares of Common Stock tendered or withheld shall be deemed delivered for purposes ofdetermining the maximum number of shares of Common Stock available for delivery under the Plan.Shares of Common Stock delivered under the Plan in settlement, assumption or substitution ofoutstanding awards or obligations to grant future awards under the plans or arrangements of anotherentity shall not reduce the maximum number of shares of Common Stock available for delivery underthe Plan, to the extent that such settlement, assumption or substitution is a result of theCorporation or an Affiliate acquiring another entity or an interest in another entity. TheCommittee may from time to time adopt and observe such procedures concerning the counting of sharesagainst the Plan maximum as it may deem appropriate. The Board and the appropriate officers of theCorporation shall from time to time take whatever actions are necessary to file any requireddocuments with governmental authorities, stock exchanges and transaction reporting systems toensure that shares of Common Stock are available for issuance pursuant to Awards.**6. Administration**     (a) This Plan shall be administered by the Committee except as otherwise provided herein.     (b) Subject to the provisions hereof, the Committee shall have full and exclusive power andauthority to administer this Plan and to take all actions that are specifically contemplated herebyor are necessary or appropriate in connection with the administration hereof. The Committee shallalso have full and exclusive power to interpret this Plan and to adopt such rules, regulations andguidelines for carrying out this Plan as it may deem necessary or proper, all of which powers shallbe exercised in the best interests of the Corporation and in keeping with the objectives of thisPlan. The Committee may, in its discretion, after considering tax and other potential legalimplications, (1) provide for the extension of the
7

 
exercisability of an Option but only to the extent such extension does not result in a modificationof the Option for purposes of Code Section 409A, (2) accelerate the vesting or exercisability of anAward in connection with the death, Disability, Retirement or termination of a Participant(including pursuant to a severance policy or plan approved by the Board or the Committee), or aChange in Control, (3) eliminate or make less restrictive any restrictions applicable to an Award,or waive any restriction or other provision of this Plan (insofar as such provision relates toAwards) or an Award, in connection with the death, Disability, Retirement or termination of aParticipant (including pursuant to a severance policy or plan approved by the Board or theCommittee), or a Change in Control, or (4) otherwise amend or modify an Award in any manner that iseither (i) not adverse to the Participant to whom such Award was granted or (ii) consented to bysuch Participant; provided, however, that payment in respect of an Award may be deferred only asprovided in paragraph 10 of this Plan. The Committee may correct any defect or supply any omissionor reconcile any inconsistency in this Plan or in any Award in the manner and to the extent theCommittee deems necessary or desirable to further the Plan purposes. Any decision of the Committee,with respect to Awards, in the interpretation and administration of this Plan shall lie within itssole and absolute discretion and shall be final, conclusive and binding on all parties concerned.     (c) No member of the Committee or officer of the Corporation to whom the Committee hasdelegated authority in accordance with the provisions of paragraph 7 of this Plan shall be liablefor anything done or omitted to be done by him or her, by any member of the Committee or by anyofficer of the Corporation in connection with the performance of any duties under this Plan, exceptfor his or her own willful misconduct or as expressly provided by statute.**7. Delegation of Authority**     Following the authorization of a pool of cash or shares of Common Stock to be available forAwards, the Committee may authorize the Chief Executive Officer of the Corporation or a committeeconsisting solely of members of the Board to grant individual Employee Awards from such poolpursuant to such conditions or limitations as the Committee may establish. The Committee may alsodelegate to the Chief Executive Officer and to other executive officers of the Corporation itsadministrative duties under this Plan (excluding its granting authority) pursuant to suchconditions or limitations as the Committee may establish. The Committee may engage or authorizethe engagement of a third party administrator to carry out administrative functions under the Plan.**8. Awards**     (a) The Committee shall determine the type or types of Awards to be made under this Plan andshall designate from time to time the Participants who are to be the recipients of such Awards.Each Award may, in the discretion of the Committee, be embodied in an Award Agreement, which shallcontain such terms, conditions and limitations as shall be determined by the Committee in its solediscretion and, if required by the Committee, shall be signed by the Participant to whom the Awardis granted and by an Authorized Officer for and on behalf of the Corporation. Awards may consistof those listed in this paragraph 8(a) and may be granted singly, in combination or in tandem.Awards may also be granted in combination or in tandem with, in replacement of, or as alternativesto, grants or rights under this Plan or any other plan of the Corporation or any of its Affiliates,including the plan of any acquired entity. An Award may provide for the grant or issuance ofadditional, replacement or alternative Awards upon the occurrence of specified events. All or partof an Award may be subject to conditions established by the Committee, which may include, but arenot limited to, continuous service with the Corporation and its Affiliates, achievement of specificbusiness objectives, increases in specified indices, attainment of specified growth rates and othercomparable measurements of performance.     (i) *Option*. An Employee Award or Director Award may be in the form of an Option. TheGrant Price of an Option shall be not less than the Fair Market Value of the
8

 
Common Stock subject to such Option on the Grant Date. Notwithstanding anything contrarycontained in this Plan including paragraphs 8(a)(i)(A) and (B), in no event shall the termof the Option extend more than ten (10) years after the Grant Date. Options may not includeprovisions that “reload” the option upon exercise, or, unless the Option is structured tocomply with Code Section 409A, otherwise provide for the deferral of compensation within themeaning of Code Section 409A other than the deferral of recognition of income until thelater of the exercise or disposition of the Option or the time the Common Stock acquiredpursuant to the exercise of the Option first becomes substantially vested. Subject to theforegoing provisions and the provisions of paragraph 11, the terms, conditions andlimitations applicable to any Options awarded to Participants pursuant to this Plan,including the Grant Price, the term of the Options, the number of shares subject to theOption and the date or dates upon which they become exercisable, shall be determined by theCommittee.     (A) Except as is otherwise provided in the Award Agreement and subject toCommittee discretion as provided in paragraph 6(b):     (1) all rights to exercise an Option shall terminate within four (4)months after the date the Participant ceases to be an Employee, or ceases tobe a Director, whichever may occur later, for any reason other than death orDisability (but in no event later than the end of the original period of theOption).     (2) In the event of a Participant’s death, an Option will terminatefifteen (15) months thereafter (but in no event later than the end of theoriginal period of the Option).     (3) In the event of a Participant’s Disability and resultingtermination of employment, an Option will terminate six (6) months aftersuch Participant’s employment termination date (but in no event later thanthe end of the original period of the Option).     (4) In the event the employment of the Participant is terminated forcause (as determined by the Committee), all Options whether or not vestedshall terminate immediately.     (5) All unvested Options are cancelled upon termination of employment;except that all non-qualified Options granted prior to April 1, 2006 shallimmediately vest upon Vested Retirement.     (B) However, if an Option is held by a Director who, on the date he or sheceases to be a Director (and, if also an Employee, ceases to be an Employee), has atleast ten (10) years of service as a Director, then all Common Stock subject to suchOption will vest on the date the Director ceases to be a Director, and all rights toexercise such Option will terminate three (3) years thereafter (but in no eventlater than the original period of the Option). Also, if an Option is held by aDirector who, on the date he or she ceases to be a Director (and, if also anEmployee, ceases to be an Employee), has less than ten (10) years of service as aDirector, then all Common Stock subject to such Option will continue to vest inaccordance with its terms for a period of three (3) years following such date, andall rights to exercise such Option will terminate three (3) years after such date(but in no event later than the original period of the Option). If Options areawarded in the final two (2) years of the term of a Director who is approaching age70, or an Employee Director who is at least age 55 with at least ten (10) years ofservice and his or her age plus years of service equal at least 70, the outsideexercise date is the
9

 
one provided in the Option or seven (7) years from the grant date, whicheveroccurs earlier. This paragraph 8(a)(i)(B) shall not apply to a Participant who isterminated for cause (as determined by the Committee).     (C) However, if an Option granted prior to April 1, 2006 is held by aParticipant who retires and satisfies the test for Vested Retirement, then allrights to exercise any and all Options will terminate 12 months following the dateof the Vested Retirement (but in no event later than the end of the original periodof the Option). To the extent that such Award provides a longer term to exercise,such Award will control.     (D) Attached hereto as Exhibit A are resolutions adopted by the Committee,pertaining to vesting and exercise, which shall apply only to Options granted priorto April 1, 2006. The provisions of paragraph 8(a)(i)(A)(5) and 8(a)(i)(C) aboveare intended to incorporate such resolutions. To the extent of any conflict betweenthe terms of such resolutions and this Plan, the resolutions will control.     (ii) *Stock Award*. An Employee Award or Director Award may be in the form of a StockAward. The terms, conditions and limitations applicable to any Stock Awards granted toParticipants pursuant to this Plan shall be determined by the Committee; provided that anyStock Award which is not a Performance Award shall have a minimum Restriction Period ofthree years from the Grant Date, provided that (A) the Committee may provide for earliervesting upon a termination of employment by reason of death, Disability or Retirement, (B)such three-year minimum Restriction Period shall not apply to a Stock Award that is grantedin lieu of salary or bonus, (C) vesting of a Stock Award may occur incrementally over thethree-year minimum Restricted Period and (D) the restrictions set forth in a Stock Awardwill terminate immediately if the Participant retires prior to the date on which therestrictions would otherwise terminate and at Retirement he or she is age 65 or older unlessotherwise specified in an Award Agreement entered into on or after January 1, 2008, or, ifnot yet age 65, as to Stock Awards granted prior to April 1, 2006, the Participant satisfiesthe test for Vested Retirement.     (iii) *Performance Award*. Without limiting the type or number of Employee Awards orDirector Awards that may be made under the other provisions of this Plan, an Employee Awardor Director Award may be in the form of a Performance Award. The terms, conditions andlimitations applicable to any Performance Awards granted to Participants pursuant to thisPlan shall be determined by the Committee; provided that any Stock Award which is aPerformance Award shall have a minimum Restriction Period of one year from the Grant Date,provided that the Committee may provide for earlier vesting upon a termination of employmentby reason of death, Disability or Retirement. The Committee shall set Performance Goals inits discretion which, depending on the extent to which they are met, will determine thevalue and/or amount of Performance Awards that will be paid out to the Participant.     (A) *Nonqualified Performance Awards*. Performance Awards granted to Employeesor Directors that are not intended to qualify as qualified performance-basedcompensation under Section 162(m) of the Code shall be based on achievement of suchgoals and be subject to such terms, conditions and restrictions as the Committee orits delegate shall determine.     (B) *Qualified Performance Awards*. Performance Awards granted to Employeesunder the Plan that are intended to qualify as qualified performance-basedcompensation under Section 162(m) of the Code shall be paid, vested or otherwisedeliverable solely on account of the attainment of one or more pre-established,objective
10

 
Performance Goals established by the Committee prior to the earlier to occur of (x)90 days after the commencement of the period of service to which the PerformanceGoal relates and (y) the lapse of 25% of the period of service (as scheduled in goodfaith at the time the goal is established), and in any event while the outcome issubstantially uncertain. A Performance Goal is objective if a third party havingknowledge of the relevant facts could determine whether the goal is met. Such aPerformance Goal may be based on one or more business criteria that apply to theEmployee, one or more business units or divisions of the Corporation or theapplicable sector, or the Corporation as a whole, and if so desired by theCommittee, by comparison with a peer group of companies. A Performance Goal mayinclude one or more of the following: (a) earnings, either in the aggregate or on aper-share basis, reflecting such dilution of shares as the Committee deemsappropriate, including operating earnings, pre-tax earnings, earnings beforeinterest and taxes, and earnings before interest, taxes, depreciation andamortization; (b) gross or net revenue; (c) operating or net cash flow; (d)financial return ratios (e.g., return or net return on one or more of the following:assets, net assets, equity, invested capital, revenue); (e) margins, includingnet, operating or pre-tax margins; (f) total shareholder return; (g) financialratios (e.g., debt to capitalization or debt to equity); (h) growth in financialmeasures or ratios (e.g., revenue, earnings, cash flow, stockholders’ equity,margins); or (i) customer satisfaction, based on specified objective goals, or acustomer survey sponsored by the Corporation or one or more business units ordivisions of the Corporation.     (C) Unless otherwise stated, such a Performance Goal need not be based upon anincrease or positive result under a particular business criterion and could include,for example, maintaining the status quo or limiting economic losses (measured, ineach case, by reference to specific business criteria). In interpreting Planprovisions applicable to Performance Goals and Qualified Performance Awards, it isthe intent of the Plan to conform with the standards of Section 162(m) of the Codeand Treasury Regulation § 1.162-27(e)(2)(i), as to grants to those Employees whosecompensation is, or is likely to be, subject to Section 162(m) of the Code, and theCommittee in establishing such goals and interpreting the Plan shall be guided bysuch provisions. Prior to the payment of any compensation based on the achievementof Performance Goals, the Committee must certify in writing that applicablePerformance Goals and any of the material terms thereof were, in fact, satisfied.Subject to the foregoing provisions, the terms, conditions and limitationsapplicable to any Qualified Performance Awards made pursuant to this Plan shall bedetermined by the Committee.     (b) Notwithstanding anything to the contrary contained in this Plan, the following limitationsshall apply to any Employee Awards made hereunder:     (i) no Participant may be granted, during any fiscal year, Employee Awards consistingof Options (including Options that are granted as Performance Awards) that are exercisablefor more than 1,110,995 shares of Common Stock;     (ii) no Participant may be granted, during any fiscal year, Employee Awards consistingof Stock Awards (including Stock Awards that are granted as Performance Awards) covering orrelating to more than 555,497 shares of Common Stock (the limitation set forth in thisclause (ii), together with the limitation set forth in clause (i) above and (c)(i) and (ii)below, being hereinafter collectively referred to as the “Stock Based Awards Limitations”);and
11

 
     (iii) no Participant may be granted Employee Awards under this Plan consisting of cash(including Awards that are granted as Performance Awards) in respect of any fiscal yearhaving a value determined on the Grant Date in excess of an amount equal to 2% of theconsolidated net income of the Corporation and its subsidiaries for such fiscal year, plusthe Black-Scholes Value, determined as of the Option Grant Date, of Options on 219,977shares of Common Stock determined as if such Options had an Option Grant Date on theeffective date of the Employee Award.     (c) Notwithstanding anything to the contrary contained in this Plan the following limitationsshall apply to any Director Awards made hereunder:     (A) no Participant may be granted, during any fiscal year, Director Awards consistingof Options (including Options that are granted as Performance Awards) that are exercisablefor more than 53,327 shares of Common Stock; and     (B) no Participant may be granted, during any fiscal year, Director Awards consistingof Stock Awards (including Stock Awards that are granted as Performance Awards) covering orrelating to more than 33,330 shares of Common Stock.**9. Change in Control**     Notwithstanding the provisions of paragraph 8 hereof, unless otherwise expressly provided inthe applicable Award Agreement, or as otherwise specified in the terms of an Equity Award, in theevent of a Change in Control during a Participant’s employment (or service as a Non-employeeDirector) with the Corporation or one of its Affiliates, each Equity Award granted under this Planto the Participant shall become immediately vested and fully exercisable, with performance-basedequity awards vested at target level (regardless of the otherwise applicable vesting or exerciseschedules or Performance Goals provided for under the Award Agreement or the terms of the EquityAward).**10. Payment of Awards**     (a) *General.*     (i) Except as otherwise provided in paragraph 10(b) or an Award Agreement, payment inrespect of Awards granted on or after January 1, 2008 other than Options will be made assoon as administratively practicable but no later than 60 days following the date on whichthe payment is no longer subject to a substantial risk of forfeiture within the meaning ofCode Section 409A; provided, however, that payment may be made at a later date foradministrative reasons to the extent permitted by Code Section 409A; provided, further, thatthe Participant shall not be permitted, directly or indirectly, to designate the calendaryear of payment. Delivery of Common Stock upon exercise of Options will be made inaccordance with paragraph 11.     (ii) Payment made to a Participant pursuant to an Award may be made in the form of cashor Common Stock, or a combination thereof, and may include such restrictions as theCommittee shall determine, including, in the case of Common Stock, restrictions on transferand forfeiture provisions. If such payment is made in the form of Restricted Stock, theCommittee shall specify whether the underlying shares are to be issued at the beginning orend of the Restriction Period. In the event that shares of Restricted Stock are to beissued at the beginning of the Restriction Period, the certificates evidencing such shares(to the extent that such shares are so evidenced) shall contain appropriate legends andrestrictions that describe the terms and conditions of the restrictions applicable thereto.In the event that shares of Restricted Stock are to
12

 
be issued at the end of the Restricted Period, the right to receive such shares shall beevidenced by book entry registration or in such other manner as the Committee may determine.     (b) *Deferral.*With the approval of the Committee, payment in respect of Awards other thanOptions may be deferred and paid either in the form of installments or as a lump-sum payment. TheCommittee may permit selected Participants to elect to defer payments of some or all types of suchAwards or any other compensation otherwise payable by the Corporation in accordance with theprovisions of this paragraph 10(b) and such other procedures as may be established by the Committeeand may provide that such deferred compensation may be payable in shares of Common Stock. TheCommittee also may specify in an Award Agreement or the terms of the Award that payment in respectof an Award will be deferred. Any deferred payment pursuant to an Award, whether elected by theParticipant or specified by the Award Agreement or the terms of the Award, may be forfeited if andto the extent that the Award Agreement or the terms of the Award so provide. Any such deferral ofpayment will be made in accordance with the following:     (i) *Initial Deferral Elections by Participants*. Except as otherwise provided in thisparagraph 10(b), the Participant must make a written, irrevocable election as to deferral ofpayment in respect of an Award and the time and form of such payment on or before thedeadline established by the Committee, which shall be no later than:     (A) December 31st of the calendar year preceding the calendar yearduring which the Participant will commence performing the services giving rise tothe Award subject to the deferral election; or     (B) for the first year in which the Participant becomes eligible to participatein the Plan, 30 days after the date the Participant first becomes eligible toparticipate in the Plan, provided that such an election will only be effective withrespect to the portion of the Award related to services performed after theelection.     (ii) *Initial Participant Deferral Elections for Performance-Based Compensation*. In theevent that the Committee determines that a deferral election may be made with respect to anAward that is Performance-Based Compensation (as defined below), an eligible Participant maymake a written, irrevocable election as to deferral of payment in respect of the Award andthe time and form of such payment on or before the deadline established by the Committee,which shall not be later than 6 months before the end of the performance period.     For purposes of this subparagraph, “Performance-Based Compensation” means an Award, theamount of which, or the entitlement to which, is contingent on the satisfaction ofpreestablished organizational or individual performance criteria relating to a performanceperiod of at least 12 consecutive months, as determined by the Committee in accordance withTreasury Regulation § 1.409A-1(e). Performance criteria are considered preestablished ifestablished in writing by not later than 90 days after the commencement of the period ofservice to which the criteria relates, provided that the outcome is substantially uncertainat the time the criteria are established.     For a Participant to be eligible to make a deferral election in accordance with thissubparagraph, the Participant must have performed services continuously from the later of(A) the beginning of the performance period for the Performance-Based Compensation or (B)the date upon which the performance criteria with respect to the Performance-BasedCompensation are established, through the date on which the Participant makes the deferralelection. In addition, in no event may a deferral election under this subparagraph be madeafter the Performance-Based
13

 
Compensation has become readily ascertainable within the meaning of Treasury Regulation §1.409A-2(a)(8).     (iii) *Initial Participant Deferral Elections for Fiscal Year Compensation*. In theevent that the Committee determines that a deferral election may be made with respect to anAward that is Fiscal Year Compensation (as defined below), the Participant may make awritten, irrevocable election as to the deferral of payment in respect of the Award and thetime and form of such payment on or before the deadline established by the Committee, whichshall not be later than the close of the Employer’s fiscal year immediately preceding thefirst fiscal year in which any services are performed for which the Award is payable. Forpurposes of this subparagraph, the term “Fiscal Year Compensation” means an Award relatingto a period of service coextensive with one or more consecutive fiscal years of theEmployer, of which no amount is paid or payable during the fiscal year(s) constituting theperiod of service.     (iv) *Initial Participant Deferral Elections for Short-Term Deferrals*. If a Participanthas a legally binding right to an Award under the Plan or a payment under an Award in asubsequent calendar year that, absent a deferral election, would be treated as a short-termdeferral within the meaning of Treasury Regulation § 1.409A-1(b)(4) and the Committeedetermines that a deferral election may be made with respect to payment in respect of theAward, the Participant may make a written, irrevocable election to defer such payment inaccordance with the requirements of subparagraph (vii) of this paragraph, applied as if thepayment were a deferral of compensation and the scheduled payment date for the payment werethe date the substantial risk of forfeiture lapses. The Committee may provide in thedeferral election that the deferred payment will be payable upon a Change in Control withoutregard to the five-year additional deferral requirement in subparagraph (vii) of thisparagraph 10(b).     (v) *Initial Participant Deferral Elections for Compensation Subject to a Risk ofForfeiture*. If a Participant has a legally binding right to an Award under the Plan orpayment in respect of an Award in a subsequent year and the payment of or under the Award issubject to a forfeiture condition requiring the Participant’s continued services for aperiod of at least 12 months from the date the Participant obtains the legally bindingright, the Committee may permit the Participant to make a written, irrevocable election todefer such payment no later than the 30th day after the Participant obtains thelegally binding right to the payment, provided that the election is made at least 12 monthsin advance of the earliest date at which the forfeiture condition could lapse, as determinedin accordance with Treasury Regulation § 1.409A-2(a)(5). For purposes of this subparagraph,a condition will not be treated as failing to require the Participant to continue to provideservices for a period of at least 12 months from the date the Participant obtains thelegally binding right merely because the condition immediately lapses upon Disability ordeath of the Participant or upon a Change in Control. However, if the Participant’sDisability or death or a Change in Control event occurs before the end of such 12-monthperiod, a deferral election under this subparagraph will be effective only if it would bepermissible under another subparagraph of this paragraph 10(b).     (vi) *Deferrals by Committee*. If an Award is made that provides for the deferral ofcompensation for services performed during a Participant’s taxable year and the Participantis not given an opportunity to elect the time or form of payment of such Award, theCommittee must designate the time and form of payment no later than the time the Participantfirst has a legally binding right to the Award or, if later, the time the Participant wouldbe required under this subparagraph 10(b) to make such an election if the Participant wereprovided such an election.
14

 
     (vii) *Subsequent Participant Deferral Elections*. Notwithstanding the foregoingprovisions of this paragraph 10(b), with approval of the Committee, a Participant may electto further delay payment in respect of an Award or change the form of payment if:     (A) the election will not take effect until at least 12 months after the dateon which the election is made;     (B) for any payment not made on account of death or Disability, the payment isdeferred for a period of not less than five years from the date the payment wouldotherwise have been paid and not later than the expiration date of the Award; and     (C) any election related to a payment to be made at a specified time orpursuant to a fixed schedule must be made not less than 12 months before the datethe payment is scheduled to be paid.Notwithstanding the foregoing or any other provision of this Plan to the contrary, theCommittee may permit Participants to make new payment elections on or before December 31,2008, with respect to the time and/or form of payment in respect of an Award, provided thatthe election applies only to amounts that would not otherwise be payable in the year inwhich the election is made and does not cause an amount to be paid in the year in which theelection is made that would not otherwise be payable in that year.     (viii) *Acceleration of Payments*. Notwithstanding any provision of this Plan, an AwardAgreement or a deferral election to the contrary, the Committee, in its discretion, mayaccelerate payment in respect of an Award in accordance with the provisions of TreasuryRegulation § 1.409A-3(j)(4)(ii) through (xiv).     (ix) *Delay of Payments.*Notwithstanding any provision of this Plan, an Award Agreementor a deferral election to the contrary, payment in respect of an Award may be delayed by theCommittee under the circumstances described in Treasury Regulation § 1.409A-2(b)(7),provided that the Committee treats all payments to similarly situated Participants on areasonably consistent basis.     (c) *Permissible Payment Events/Times*. The Committee may specify any one or more of thefollowing as an event upon or a time at which payment of the vested portion of an Award may be madepursuant to a deferral election under paragraph 10(b): (i) Separation from Service, (ii)Disability, (iii) death, (iv) a specified date or pursuant to a fixed schedule, or (v) a Change inControl. The Committee may provide for payment upon the earliest or latest of more than one suchevent or time.     (d) *Time of Payment*. The payment date with respect to payment of an Award that is deferredunder paragraph 10(b) shall be the permissible payment event or time under paragraph 10(c)designated by the Participant or the Committee, as applicable, in accordance with paragraph 10(b).Payment in respect of an Award shall be made within 60 days following the payment date; provided,however, that payment may be made at a later date for administrative reasons to the extentpermitted by Code Section 409A; provided, further, that the Participant shall not be permitted,directly or indirectly, to designate the calendar year of the payment.     (e) *Specified Employees*. Any provision of the Plan to the contrary notwithstanding, if anypayment in respect of a Participant’s Award provides for a deferral of compensation under CodeSection 409A and the Participant is a Specified Employee as of the date of his or her Separationfrom Service, no payment on account of the Participant’s Separation from Service may be made withrespect to such Participant before the date that is six months after the Participant’s Separationfrom Service (or, if earlier
15

 
than the end of the six-month period, the date of the Participant’s death). In such case, anypayment that would be made within such six-month period will be accumulated and paid in a singlelump sum on the on the earliest business day that complies with the requirements of Code Section409A.     (f) *Dividends, Earnings and Interest.*Rights to dividends or Dividend Equivalents may beextended to and made part of any Stock Award, subject to such terms, conditions and restrictions asthe Committee may establish. The Committee may also establish rules and procedures for thecrediting of interest or other earnings on deferred cash payments and Dividend Equivalents forStock Awards.     (g) *Substitution of Awards.*Subject to paragraphs 13 and 15, at the discretion of theCommittee and after considering tax and other potential legal implications, a Participant who is anEmployee may be offered an election to substitute an Employee Award for another Employee Award orEmployee Awards of the same or different type.**11. Option Exercise**     Following exercise the Grant Price shall be paid in full in cash at the time of delivery ofthe stock or, if permitted by the Committee and elected by the optionee, the optionee may purchasesuch shares by means of tendering Common Stock owned by the optionee, or having the Corporationwithhold from the shares otherwise issuable pursuant to the Option an appropriate number of sharesof Common Stock, valued at Fair Market Value on the date of exercise, or any combination thereof.The Committee shall determine acceptable methods for Participants to tender Common Stock or haveCommon Stock withheld in payment of the Grant Price. The Committee may provide for procedures topermit the exercise or purchase of such Awards by use of the proceeds to be received from the saleof Common Stock issuable pursuant to an Award. The Committee may adopt additional rules andprocedures regarding the exercise of Options from time to time, provided that such rules andprocedures are not inconsistent with the provisions of this paragraph.     An optionee desiring to pay the Grant Price of an Option by tendering Common Stock using themethod of attestation may, subject to any such conditions and in compliance with any suchprocedures as the Committee may adopt, do so by attesting to the ownership of Common Stock of therequisite value in which case the Corporation shall issue or otherwise deliver to the optionee uponsuch exercise a number of shares of Common Stock subject to the Option equal to the result obtainedby dividing (a) the excess of the aggregate Fair Market Value of the shares of Common Stock subjectto the Option for which the Option (or portion thereof) is being exercised over the Grant Pricepayable in respect of such exercise by (b) the Fair Market Value per share of Common Stock subjectto the Option, and the optionee may retain the shares of Common Stock the ownership of which isattested.     If an optionee desires to pay the Grant Price of an Option by having the Corporation withholdfrom the shares otherwise issuable pursuant to the Option shares of Common Stock of the requisitevalue, then, subject to any conditions and in compliance with any procedures as the Committee mayadopt, the Corporation shall issue or otherwise deliver to the optionee upon such exercise a numberof shares of Common Stock subject to the Option equal to the result obtained by dividing (a) theexcess of the aggregate Fair Market Value of the shares of Common Stock subject to the Option forwhich the Option (or portion thereof) is being exercised over the Grant Price payable in respect ofsuch exercise by (b) the Fair Market Value per share of Common Stock subject to the Option.**12. Taxes**     The Corporation or its designated third party administrator shall have the right to deductapplicable taxes from any Employee Award payment and withhold, at the time of delivery or vestingof cash or shares of Common Stock under this Plan, an appropriate amount of cash or number ofshares of
16

 
Common Stock or a combination thereof for payment of taxes or other amounts required by law orto take such other action as may be necessary in the opinion of the Corporation to satisfy allobligations for withholding of such taxes. The Committee may also permit withholding to besatisfied by the transfer to the Corporation of shares of Common Stock theretofore owned by theholder of the Employee Award with respect to which withholding is required. If shares of CommonStock are used to satisfy tax withholding, such shares shall be valued based on the Fair MarketValue when the tax withholding is required to be made. The Committee may provide for loans, oneither a short term or demand basis, from the Corporation to a Participant who is an Employee topermit the payment of taxes required by law.**13. Amendment, Modification, Suspension or Termination of the Plan**     The Board may amend, modify, suspend or terminate this Plan for the purpose of meeting oraddressing any changes in legal requirements or for any other purpose permitted by law, except that(i) no amendment or alteration that would adversely affect the rights of any Participant under anyAward previously granted to such Participant shall be made without the consent of such Participantand (ii) no amendment or alteration shall be effective prior to its approval by the stockholders ofthe Corporation to the extent such approval is required by applicable legal requirements or therequirements of the securities exchange on which the Corporation’s stock is listed.Notwithstanding anything herein to the contrary, except in connection with a corporate transactioninvolving the Corporation (including, without limitation, a subdivision or consolidation ofoutstanding shares, stock dividend, stock split, extraordinary cash dividend, recapitalization,capital reorganization, split-up, spin-off, merger, consolidation, combination or exchange ofshares), (a) the terms of outstanding Awards may not be amended to reduce the exercise price ofOptions, (b) Options will not be repriced, replaced, or regranted through cancellation or bydecreasing the Grant Price of a previously granted Option, and (c) outstanding Options will not bereplaced with cash or another Award, in each case without approval of the Corporation’sstockholders.**14. Assignability**     (a) Except as provided in paragraphs 14(b) and (c), no Award or any other benefit under thisPlan shall be assignable or otherwise transferable except by will, beneficiary designation, thelaws of descent and distribution, or a domestic relations order. The Committee may prescribe andinclude in applicable Award Agreements or the terms of the Award other restrictions on transfer.No right or interest of a Participant in any Award may be pledged, encumbered or hypothecated to,or in favor of, any party other than the Corporation or an Affiliate. Any attempted assignment ofan Award or any other benefit under this Plan in violation of this paragraph 14 shall be null andvoid.     (b) During his or her lifetime a Participant may transfer an Award without value orconsideration to any Family Member if the transfer is approved by the Committee, in its discretion.A Participant seeking a transfer of an Award pursuant to this subparagraph shall make a requestfor approval to the Committee by contacting the Corporation in writing. The Committee shall beunder no obligation to grant a request for a transfer to a Family Member. If an Award istransferred as contemplated herein, such transferred Award may not be subsequently transferred bythe transferee (other than another transfer meeting the conditions herein) except by will or thelaws of descent and distribution. A transferred Award shall continue to be governed by and besubject to the terms and limitations of this Plan and the relevant Award Agreement, and thetransferee shall be entitled to same rights as a Participant, as if the transfer had not takenplace.     (c) A Participant may, in the manner determined by the Committee, designate a beneficiary toexercise the rights of the Participant and to receive any distribution with respect to any Awardupon the Participant’s death. A beneficiary, legal guardian, legal representatives, or otherperson claiming any rights pursuant to this Plan is subject to all the terms and conditions of thePlan and any Award
17

 
Agreement applicable to the Participant, except to the extent the Plan and Award Agreementotherwise provides, and any additional restrictions deemed necessary or appropriate by theCommittee. If no beneficiary has been designated or survives the Participant, payments to be madeto the person entitled thereto pursuant to the Participant’s will or the laws of descent anddistribution. If a beneficiary designation conflicts with an assignment by will, the beneficiarydesignation will prevail. Subject to the foregoing, a beneficiary designation may be changed orrevoked by a Participant at any time provided the change or revocation is provided to theCorporation on behalf of the Committee.**15. Adjustments**     (a) The existence of outstanding Awards shall not affect in any manner the right or power ofthe Corporation or its stockholders to make or authorize any or all adjustments, recapitalizations,reorganizations or other changes in the capital stock of the Corporation or its business or anymerger or consolidation of the Corporation, or any issue of bonds, debentures, preferred or priorpreference stock (whether or not such issue is prior to, on a parity with or junior to the existingCommon Stock) or the dissolution or liquidation of the Corporation, or any sale or transfer of allor any part of its assets or business, or any other corporate act or proceeding of any kind,whether or not of a character similar to that of the acts or proceedings enumerated above.     (b) In the event of any subdivision or consolidation of outstanding shares of Common Stock,declaration of a dividend payable in shares of Common Stock or other stock split, then (i) thenumber of shares of Common Stock reserved under this Plan, (ii) the number of shares of CommonStock covered by outstanding Awards, (iii) the Grant Price or other price in respect of suchAwards, (iv) the appropriate Fair Market Value and other price determinations for such Awards, and(v) the Stock Based Awards Limitations shall each be proportionately adjusted to reflect suchtransaction. In the event of any other recapitalization or capital reorganization of theCorporation, any consolidation or merger of the Corporation with another corporation or entity, theadoption by the Corporation of any plan of exchange affecting Common Stock or any distribution toholders of Common Stock of securities or property (other than normal cash dividends or dividendspayable in Common Stock), the Board may make appropriate adjustments to (i) the number of shares ofCommon Stock reserved under this Plan, (ii) the number of shares of Common Stock covered by Awards,(iii) the Grant Price or other price in respect of such Awards, (iv) the appropriate Fair MarketValue and other price determinations for such Awards, and (v) the Stock Based Awards Limitations toreflect such transaction; provided that such adjustments shall only be such as are necessary tomaintain the proportionate interest of the holders of the Awards and preserve, without increasing,the value of such Awards. In the event of a corporate merger, consolidation, acquisition ofproperty or stock, separation, reorganization or liquidation, the Board shall be authorized (x) toassume under the Plan previously issued compensatory awards, or to substitute new Awards forpreviously issued compensatory awards, including Awards, as part of such adjustment or (y) tocancel Awards that are Options and give the Participants who are the holders of such Awards noticeand opportunity to exercise for 30 days prior to such cancellation.**16. Restrictions**     No Common Stock or other form of payment shall be issued with respect to any Award unless theCorporation shall be satisfied based on the advice of its counsel that such issuance will be incompliance with applicable federal and state securities laws. Certificates evidencing shares ofCommon Stock delivered under this Plan (to the extent that such shares are so evidenced) may besubject to such stop transfer orders and other restrictions as the Committee may deem advisableunder the rules, regulations and other requirements of the Securities and Exchange Commission, anysecurities exchange or transaction reporting system upon which the Common Stock is then listed orto which it is admitted for
18

 
quotation and any applicable federal or state securities law. The Committee may cause a legendor legends to be placed upon such certificates (if any) to make appropriate reference to suchrestrictions.**17. Unfunded Plan**     This Plan shall be unfunded. Although bookkeeping accounts may be established with respect toParticipants under this Plan, any such accounts shall be used merely as a bookkeeping convenience,including bookkeeping accounts established by a third party administrator retained by theCorporation to administer the Plan. The Corporation shall not be required to segregate any assetsfor purposes of this Plan or Awards hereunder, nor shall the Corporation, the Board or theCommittee be deemed to be a trustee of any benefit to be granted under this Plan. Any liability orobligation of the Corporation to any Participant with respect to an Award under this Plan shall bebased solely upon any contractual obligations that may be created by this Plan and any AwardAgreement or the terms of the Award, and no such liability or obligation of the Corporation shallbe deemed to be secured by any pledge or other encumbrance on any property of the Corporation.Neither the Corporation nor the Board nor the Committee shall be required to give any security orbond for the performance of any obligation that may be created by this Plan.**18. Right to Employment**     Nothing in the Plan or an Award Agreement shall interfere with or limit in any way the rightof the Corporation or an Affiliate to terminate any Participant’s employment or other servicerelationship at any time, nor confer upon any Participant any right to continue in the capacity inwhich he or she is employed or otherwise serves the Corporation.**19. Successors**     All obligations of the Corporation under the Plan with respect to Awards granted hereundershall be binding on any successor to the Corporation, whether the existence of such successor isthe result of a direct or indirect purchase, merger, consolidation, or otherwise, of all orsubstantially all of the business and/or assets of the Corporation.**20. Governing Law**     This Plan and all determinations made and actions taken pursuant hereto, to the extent nototherwise governed by mandatory provisions of the Code or the securities laws of the United States,shall be governed by and construed in accordance with the laws of the State of Texas.**21. Effectiveness**     The Plan was submitted to the stockholders of the Corporation for approval and approved at the2003 annual meeting of shareholders to be effective as of April 1, 2003. The Plan has been amendedsince then by the Board with the most recent amendment effective as of May 7, 2008.**22. NYSE Limitations**     If any provision of this Plan has the effect of increasing the number of shares available forAwards hereunder by adding back shares and such provision constitutes a “formula” under the formulaplan rules of the New York Stock Exchange, Inc. (“NYSE”) (including Section 303A.08 of the NYSE’sListed Company Manual), then the portion of such provision that constitutes a “formula” shall beoperative only until, and shall cease to be effective on, the date that is 10 years after July 17,2003 or, if later, the date of the most recent shareholder approval of the Plan.
19

 
**23. Adoption By Affiliates**     With the consent of the Committee, any Affiliate that is not considered a single employer withthe Corporation under Code Section 414(b) or Code Section 414(c) may adopt the Plan for the benefitof its Employees by written instrument delivered to the Committee before the grant of any Awardsubject to Code Section 409A to the Affiliate’s Employees under the Plan.
20

 
**Exhibit A**