**Exhibit 10.3**

 

JANUS CAPITAL GROUP INC.

 

AMENDED AND RESTATED DIRECTOR DEFERREDFEE PLAN

 

EFFECTIVE AS OF

JANUARY 1, 2005 

AMENDED AS OF OCTOBER 20, 2008

 

ARTICLE I -INTRODUCTION

 

Janus Capital Group Inc. (the “Company”) hasestablished the Janus Capital Group Inc. Director Deferred Fee Plan (the “Plan”)to permit eligible members of the Company’s board of directors to defer theirfees and certain stock awards made under its director compensation programs.The Plan was originally adopted June 12, 2000, and was subsequentlyrestated on May 12, 2004, January 1, 2005 and January 22, 2008.This document, which is a complete restatement of the Plan, is effective as of October 20,2008, and it shall apply to amounts that are considered deferred after December 31,2004 for purposes of Section 409A. Prior deferrals shall continue to begoverned by the terms of the May 12, 2004 restatement.

 

This document sets forth the terms of thePlan for applicable deferrals, specifying the group of Directors of the Company’sboard of directors who are eligible to make deferrals, the procedures forelecting to defer compensation and the Plan’s provisions for maintaining andpaying out amounts that have been deferred.

 

The Plan shall be unfunded and unsecured, andamounts deferred by an Eligible Director are an obligation of the Company.

 

ARTICLE II -DEFINITIONS

 

When used in this Plan, the followingunderlined terms shall have the meanings set forth below unless a differentmeaning is plainly required by the context:

 

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2.01         Account:

 

The account maintained for a Participant onthe books of the Company to determine, from time to time, the Participant’sinterest under this Plan. The balance in such Account shall be determined bythe Plan Administrator’s delegate. Each Participant’s Account shall consist ofat least one Deferral Subaccount for each separate deferral of Monetary Fees orStock Fees under Section 4.02. The Plan Administrator’s delegate may alsoestablish such additional Deferral Subaccounts as it deems necessary for the properadministration of the Plan. The Plan Administrator’s delegate may also combineDeferral Subaccounts to the extent it deems separate accounts are not neededfor sound recordkeeping; provided, that a Monetary Fee Subaccount may not becombined with a Stock Fee Subaccount and a Stock Fee Subaccount may not becombined with a Monetary Fee Subaccount. Where appropriate, a reference to aParticipant’s Account shall include a reference to each applicable DeferralSubaccount that has been established thereunder.

 

2.02         Beneficiary:

 

The person or persons (including a trust ortrusts) properly designated by a Participant, as determined by the PlanAdministrator’s delegate, to receive the amounts in one or more of theParticipant’s Deferral Subaccounts in the event of the Participant’s death. Tobe effective, any Beneficiary designation must be in writing, signed by theParticipant, and filed with the Plan Administrator’s delegate prior to theParticipant’s death. In addition, the designation must meet such otherstandards as the Plan Administrator shall require from time to time. If nodesignation is validly in effect at the time of a Participant’s death or if alldesignated Beneficiaries have predeceased the Participant, then the Participant’sBeneficiary shall be his or her Spouse. If the Participant has no Spouse or ifthe Participant’s Spouse has predeceased the Participant, then the Participant’sBeneficiary shall be his or her children (paid on a per stirpes basis). If theParticipant has no children or if the Participant’s children have predeceasedthe Participant, then the Participant’s Beneficiary shall be his or her estate.A Beneficiary designation of an individual by name (or name and relationship)remains in effect regardless of any change in the designated individual’srelationship to the Participant. A Beneficiary designation solely byrelationship (for example, a designation of “Spouse,” that does not give thename of the Spouse) shall designate whoever is the person in that relationshipto the Participant at his or her death. An individual who is otherwise aBeneficiary with respect to a Participant’s Account ceases to be a Beneficiarywhen all payments have been made from the Account.

 

2.03         Board:

 

The Board of Directors of the Company.

 

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2.04         Change in Ownership:

 

A change in the ownership or effectivecontrol of the Company, or in the ownership of a substantial portion of theassets of the Company, as defined in Reg. 1.409A-3(i)(5).

 

2.05         Code:

 

The Internal Revenue Code of 1986, as amendedfrom time to time.

 

2.06         Company:

 

Janus Capital Group Inc., a corporationorganized and existing under the laws of the State of Delaware, or itssuccessor or successors.

 

2.07         Deferral Subaccount:

 

A subaccount of a Participant’s Accountmaintained to reflect his or her interest in the Plan attributable to eachdeferral (or separately tracked portion of a deferral) of Monetary Fees andStock Fees, respectively, and earnings or losses credited to such subaccount inaccordance with Article V. Each Deferral Subaccount shall be classified aseither a Monetary Fee Subaccount or a Stock Fee Subaccount.

 

2.08         Disability:

 

A Participant shall be considered to sufferfrom a Disability, if, in the judgment of the Plan Administrator’s delegate,the Participant -

(a)           Is unable to engage in anysubstantial gainful activity by reason of any medically determinable physicalor mental impairment which can be expected to result in death or can beexpected to last for a continuous period of not less than 12 months, or

 

(b)           Is, by reason of any medicallydeterminable physical or mental impairment which can be expected to result indeath or can be expected to last for a continuous period of not less than 12months, receiving income replacement benefits for a period of not less than 3months under an accident and health plan covering employees of the Company.

 

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2.09         Distribution Date:

 

Distribution Date shall have the same meaningas Valuation Date; provided, however, if the Valuation Date is more frequentthan once per month, the Distribution Date shall mean the first day of eachmonth.

 

2.10         Dividend Equivalent:

 

A Dividend Equivalent shall be provided toreflect the cash, Stock or other property dividends paid on actual shares ofStock. The amount and character of the Dividend Equivalent shall be determinedby the Plan Administrator’s delegate, to the extent possible, based on thedividends the Participant’s Stock Fee Subaccount would receive if it heldactual shares equal in number to the phantom units existing in the Participant’sStock Fee Subaccount on the record date of the actual dividend.

 

2.11         Election Form:

 

The form prescribed by the Plan Administrator’sdelegate on which a Participant specifies the amount of his or her MonetaryFees and Stock Fees to be deferred pursuant to the provisions of Article IV.An Election Form need not exist in a paper format, and it is expresslycontemplated that the Plan Administrator’s delegate may adopt suchtechnologies, including voice response systems, emails, electronic forms andinternet or intranet sites, as it deems appropriate from time to time.

 

2.12         Eligible Director:

 

The term, Eligible Director, shall have themeaning given to it in Section 3.01(b).

 

2.13         ERISA:

 

Public Law 93-406, the Employee RetirementIncome Security Act of 1974, as amended from time to time.

 

2.14         Fair Market Value:

 

The closing price on the applicable date (orif such date is not a trading date, the immediately preceding date that is atrading date) for Stock as reported on the composite tape for securities listedon the New York Stock Exchange, Inc., rounded to four decimal places.

 

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2.15         Fees:

 

The Monetary Fees and the Stock Fees,collectively.

 

2.16         Key Employee:

 

Any Eligible Director or former EligibleDirector who as of December 31st of the Plan Year preceding the Plan Yearin which the Director incurs a Separation from Service:  –

 

(a)           an officer of the Company thatmaintains a “Vice President” or higher office (or equivalent designation) asdefined by the Human Resources Department of the Company;;

 

(b)           a 5 percent owner of the Company; or

 

(c)           a 1-percent owner of the Companyhaving annual compensation of more than $150,000.

 

2.17         Monetary Fees:

 

Direct monetary remuneration to the extentpaid in U.S. dollars to the Eligible Director by the Company. Monetary Feesshall be limited to the amount due an Eligible Director for the discharge ofhis or her duties as a member of the Board, and shall be reduced for anyamounts that the Plan Administrator recognizes as reducing the amount ofMonetary Fees available for deferral. Monetary Fees shall not include theamount of any reimbursement by the Company for expenses incurred by theEligible Director in the discharge of his or her duties as a member of theBoard.

 

2.18         Monetary Fee Subaccount:

 

The one or more Deferral Subaccounts thattrack the Participant’s deferrals of Monetary Fees and the earnings and lossesapplicable thereto.

 

2.19         Participant:

 

Any Eligible Director who is qualified toparticipate in this Plan in accordance with Section 3.01 and who has anAccount. An active Participant is one who is currently deferring under Section 4.01.

 

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2.20         Plan:

 

The Janus Capital Group Inc. DirectorDeferred Fee Plan, as set forth herein and as it may be amended and restatedfrom time to time.

 

2.21         Plan Administrator:

 

The Board or a committee appointed by theBoard to administer the Plan (“Plan Committee”). The Plan Committee shallconsist of two or more directors of the Company, all of whom qualify as “non-employeedirectors” within the meaning of Rule 16b-3. The number of members of thePlan Committee shall from time to time be increased or decreased, and shall besubject to such conditions, in each case as the Board deems appropriate topermit transactions in securities (including derivative securities) of theCompany pursuant to the Plan to satisfy such conditions of Rule 16b-3 asthen in effect.

 

2.22         Plan Year:

 

The 12-consecutive month period beginning on January 1and ending on December 31.

 

2.23         Section 409A:

 

Section 409A of the Code and theapplicable regulations and other guidance of general applicability that isissued thereunder.

 

2.24         Separation from Service:

 

A Participant’s separation from service withthe Company and all other Company subsidiaries and affiliates, which meets therequirements of Section 409A(a)(2)(A)(i).

 

2.25         Spouse:

 

An individual shall be considered aParticipant’s Spouse for purposes of this Plan if - (i) the individual isof the opposite gender to the Participant, (ii) the individual and theParticipant are considered to be legally married (including a common lawmarriage, if the common law marriage was formed in one of the states thatpermit the formation of a common law marriage), and (iii) the marriage ofthe individual and the Participant is recognized on the relevant day as validin the state where the Participant resides.

 

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2.26         Start Date:

 

The effective date that this Plan was amendedand restated, which is January 1, 2005.

 

2.27         Stock:

 

The Company’s common stock, $0.01 par value.

 

2.28         Stock Fees:

 

Restricted Stock awarded to an EligibleDirector pursuant to the 1998 Long Term Incentive Stock Plan or any successorplan that is recognized by the Plan Administrator as eligible for deferral forpurposes of this Plan.

 

2.29         Stock Fee Subaccount:

 

The one or more Deferral Subaccounts thattrack the Participant’s deferrals of Stock Fees and the earnings and lossesapplicable thereto.

 

2.30         Unforeseeable Emergency:

 

A severe financial hardship to theParticipant resulting from -

 

(a)           An illness or accident of theParticipant, the Participant’s Spouse or a dependent (as defined in Codesection 152(a)) of the Participant;

 

(b)           Loss of the Participant’s propertydue to casualty; or

 

(c)           Any other similar extraordinary andunforeseeable circumstances arising as a result of events beyond the control ofthe Participant.

 

The Plan Administrator’s delegate shalldetermine the occurrence of an Unforeseeable Emergency in accordance with Section 409A(a)(2)(B)(ii).

 

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2.31         Valuation Date:

 

Each date as specified by the PlanAdministrator from time to time as of which Participant Accounts are valued inaccordance with Plan procedures that are currently in effect. As of the StartDate, the Valuation Dates are March 31, June 30, September 30and December 31. In accordance with procedures that may be adopted by thePlan Administrator, any current Valuation Date may be changed. Values aredetermined as of the close of a Valuation Date or, if such date is not abusiness day, as of the close of the immediately preceding business day.

 

ARTICLE III -ELIGIBILITY AND PARTICIPATION

 

3.01         Eligibility to Participate.

 

(a)           Only Eligible Directors, as definedbelow, shall be eligible to make an initial deferral of compensation under thisPlan. During the period an individual satisfies all of the eligibilityrequirements of this Section, he or she shall be referred to as an EligibleDirector.

 

(b)           An Eligible Director shall mean anyindividual who is currently a member of the Board and who is not currently anemployee of the Company or one of its affiliates.

 

(c)           Each Eligible Director becomes anactive Participant on the date an amount is first withheld from his or hercompensation pursuant to an Election Form submitted by the EligibleDirector to the delegate of the Plan Administrator in accordance with Section 4.01.

 

3.02         Termination of Eligibility to Defer.

 

A Participant’s eligibility to make futuredeferrals under Section 4.01 shall terminate upon the date he or sheceases to be an Eligible Director. After termination of an individual’seligibility to make deferrals under the Plan and until termination ofparticipation in accordance with Section 3.03, the individual shall be aninactive Participant in this Plan.

 

3.03         Termination of Participation.

 

An individual, who is a Participant (whetheractive or inactive) under the Plan, ceases to be a Participant on the date hisor her Account is fully paid out.

 

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ARTICLE IV -DEFERRAL OF COMPENSATION

 

4.01         Deferral Elections.

 

(a)           Each Eligible Director may make anelection to defer under the Plan any whole percentage of his or her MonetaryFees (up to 100%) in the manner described in Section 4.02. Any percentageof Monetary Fees deferred by an Eligible Director for a Plan Year shall bededucted in each payment period during the Plan Year for which he or she hasMonetary Fees and is an Eligible Director. In addition, each Eligible Directormay make an election to defer under the Plan any whole number of sharesincluded in his or her Stock Fees (up to the entire award). Any portion ofStock Fees elected for deferral by an Eligible Director for a Plan Year shallreduce the shares of Stock Fees otherwise payable to the Eligible Director andshall be deemed deferred at the time these Stock Fees would otherwise be issuedto the Director, provided he or she remains an Eligible Director at such time.

 

(b)           Notwithstanding subsection (a) above,the Plan Administrator in its discretion may implement rules andprocedures from time to time that allow Eligible Directors - (1) to electto defer Monetary Fees and/or Stock Fees using other measures, such asdeferring Monetary Fees in whole dollar amounts and Stock Fees in percentages,or (2) to specify a dollar maximum that would limit their deferral electionsof Monetary Fees and/or Stock Fees.

 

(c)           To be effective, an EligibleDirector’s Election Form must set forth - (i) the portion of MonetaryFees and/or Stock Fees to be deferred in accordance with subsection (a) above(or based on an alternative measure in accordance with subsection (b)), (ii) inthe case of deferrals of Monetary Fees, the initial phantom investment optionor options under Section 5.02 to which the will be credited initially, (iii) theEligible Director’s Beneficiary designation (in accordance with Section 4.02(e)),and (iv) any other information that may be required by the Plan Administratorfrom time to time. In addition, the Election Form may, but is not requiredto, include a form of payment election as provided by Section 4.03 below.All Election Forms must also meet the requirements of Section 4.02 below.

 

4.02         Time and Manner of Deferral Election.

 

(a)           Deferrals of Monetary Fees. Exceptas set forth below, an Eligible Director must make a deferral election for aPlan Year with respect to Monetary Fees by November 30th of the Plan Yearpreceding the Plan Year in which the services are performed for which theMonetary Fees would otherwise be paid. An individual who newly becomes anEligible Director (and who was not previously an Eligible Director during priorPlan Years and was not eligible to participate in any plan of the Company 

 

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that would beaggregated with the Plan under Reg. 1.409A-1(c)) will have 30 days from thedate the individual becomes an Eligible Director to make an election withrespect to compensation earned for payment periods that begin after theelection is received (if this 30-day period ends later than the deadline underthe preceding sentence).

 

(b)           Deferrals of Stock Fees. Except asset forth below, an Eligible Director must make a deferral election for a PlanYear with respect to Stock Fees by November 30th of the PlanYear preceding the Plan Year in which the services are performed for which theStock Fees are granted.  To the extent itresults in a later deferral deadline than applicable under the preceding twosentences, an individual who newly becomes an Eligible Director during a PlanYear (and who was not previously an Eligible Director during prior Plan Yearsand was not eligible to participate in any plan of the Company that would beaggregated with the Plan under Reg. 1.409A-1(c)) may make a deferral electionwith respect to his or her Stock Fees that relate to services to be performedafter the date of the election so long as the deferral election is made within30 days of the date the individual becomes an Eligible Director.

 

(c)           General Provisions. A separatedeferral election must be made by an Eligible Director for each category ofcompensation that is eligible for deferral. If an Eligible Director fails tofile a properly completed and executed Election Form with the PlanAdministrator’s delegate by the prescribed time, he or she will be deemed tohave elected not to defer any Monetary Fees or Stock Fees, as the case may be,for the applicable Plan Year. An election is irrevocable once received anddetermined by the delegate of the Plan Administrator to be properly completed.Increases or decreases in the amount or percentage a Participant elects todefer shall not be permitted once an election has become irrevocable.Notwithstanding the preceding provisions of this Section, to the extentnecessary because of circumstances beyond the control of the Eligible Directorand in the interests of orderly Plan administration (or to avoid undue hardshipto an Eligible Director), the Plan Administrator may grant an extension of anyelection period or may permit the complete revocation of an election, but suchextension or revocation shall not permit an election or revocation to be madeafter the latest time permissible for initial elections under Section 409A.

 

(d)           Beneficiaries. To be consideredcomplete, the first Election Form filed by a Participant shall designatethe Beneficiary to receive payment, in the event of his or her death, of theamounts credited to his or her applicable Deferral Subaccounts. Any Beneficiarydesignation made on a subsequent Election Form or through a separateBeneficiary designation shall apply on an aggregate basis to all of a Participant’sDeferral Subaccounts. However, a Participant’s Beneficiary designation shallonly be effective if it is signed by the Participant and filed with the PlanAdministrator’s delegate prior to the Participant’s death, and if it meets suchother standards as the Plan Administrator’s delegate shall require from time totime. A Beneficiary is paid in accordance with the terms of a Participant’sElection Form, as interpreted by the Plan Administrator’s delegate inaccordance with the terms of this Plan.

 

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4.03                           Form of Payment Election.

 

An EligibleDirector making a deferral election of Monetary Fees and/or Stock Fees may (butis not required to) specify a form of payment on his or her Election Form bydesignating either a lump sum payment or installment payments for 5, 10, 15 or20 years. Such form of payment election shall be applicable to the amountsdeferred in the related Monetary Fee and/or Stock Fees deferral election. If anEligible Director elects installment payments, the Eligible Director shall alsospecify whether installments should be paid quarterly, semi-annually orannually. If an Eligible Director fails to make a form of payment election forMonetary Fees and/or Stock Fees under this Section 4.03, his or her formof payment shall be as provided in Section 6.02.

 

4.04                           Subsequent Revisions to Form ofPayment.

 

AnEligible Director may make an election to revise the form of payment thatapplies to previously deferred Monetary Fees and Stock Fees in accordance withthis section. An election made under this section must be made at least 12months prior to the date of the first scheduled payment and the election shallnot be effective for 12 months after it is made. So long as a Participantqualifies under this section to change his or her form of payment, there is nolimit on the number of elections that may be made under this section. Any formof payment elected under this section must be authorized and available to theParticipant under the terms of Section 4.03. This section shall not applyto a Beneficiary.

 

ARTICLE V - INTERESTS OFPARTICIPANTS

 

5.01                           Accounting for Participants’Interests.

 

EachParticipant shall have at least one separate Deferral Subaccount for eachseparate deferral of Monetary Fees and Stock Fees made by the Participant underthis Plan. However, the Plan Administrator’s delegate may also combine DeferralSubaccounts to the extent it deems separate accounts are not needed for soundrecordkeeping. A Participant’s deferral of Monetary Fees shall be credited tohis or her Account as soon as practicable following the date when thecompensation would have been paid or considered paid to the Participant in theabsence of its deferral. A Participant’s deferral of Stock Fees shall becredited to his or her Account as soon as practicable following the date whenthe related stock would be issued (if the deferral occurs prior to issuance) orwhen the related stock is no longer issued as a result of the deferral (if thedeferral occurs after issuance in accordance with Section 4.02(b)(2)). AParticipant’s Account is a bookkeeping device to track the value of his or herdeferrals (and the Company’s liability

 

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therefor). No assets shall be reserved orsegregated in connection with any Account, and no Account shall be insured orotherwise secured.

 

5.02                           Phantom Investment of the MonetaryFee Subaccount.

 

(a)                                  Phantom Investment Options. Thephantom investment options that are available under this Plan for a Participant’sMonetary Fee Subaccount shall be the following Janus retail mutual funds: (i) JanusMoney Market Fund, (ii) Janus Flexible Income Fund, (iii) JanusBalance Fund, (iv) Janus Global Opportunities Fund, (v) Janus Mid CapValue Fund, (vi) Janus Fund, (vii) Janus Overseas Fund, and (viii) JanusSmall Cap Value Fund (elections into the Janus Small Cap Value Fund are onlyavailable for existing Participants in such fund). An amount deferred ortransferred into one of these options is converted to phantom units ofequivalent value by dividing such amount by the value of a unit in such fund onthe date as of which the amount is treated as invested in this option by thePlan Administrator. Thereafter, a Participant’s interest in each such phantomoption is valued as of a Valuation Date by multiplying the number of phantomunits credited to his or her Account on such date by the value of a unit in theapplicable fund on such date. The Plan Administrator may discontinue anyphantom investment option with respect to some or all Monetary Fee Subaccount,and it may provide rules for transferring a Participant’s phantominvestment from the discontinued option to a specified replacement option(unless the Participant selects another replacement option in accordance withsuch requirements as the Plan Administrator may apply). The addition of any newphantom investment option by the Plan Administrator shall comply with Section 409A.

 

(b)                                 Phantom Investment OptionsDirections. In connection with an Eligible Director’s first deferral Election Form submittedunder the Plan, the Eligible Director shall specify in one (1) percentincrements how his or her Monetary Fee deferrals are to be invested in one ormore of the phantom investment options offered under this section. Thereafter,the Eligible Director - (i) may specify a different investment directionthat shall apply to his or her future Monetary Fee deferrals, and (ii) mayreallocate the investment of his or her existing Monetary Fee Subaccount byspecifying, in one (1) percent increments, how such amounts are to beinvested among the phantom investment options then offered under the Plan. ThePlan Administrator may provide that such initial allocations or reallocationsare to be made in a different increment specified by the Plan Administrator. Anew investment direction for future Monetary Fee deferrals and a reallocationof a Participant’s existing Monetary Fee Subaccount shall be made using theinvestment procedures that are provided by the Plan Administrator’s delegatefor this purpose. This procedure may include the use of written or electronicforms, as well as the use of a voice-response system, as determined by the PlanAdministrator’s delegate.

 

(c)                                  Phantom Investment OptionsReallocations. Any investment reallocation of a Participant’s existing Monetary Fee Subaccount thatis  permitted by subsection (b) shallbe effective as of the next Valuation Date that occurs at least 30 days after the date

 

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theinvestment  reallocation is received by thePlan Administrator’s delegate. If more than one reallocation is received on atimely basis, the reallocation that the Plan Administrator’s delegatedetermines to be the most recent shall be followed.

 

(d)                                 Direction and Reallocation DefaultRules. If the Plan Administrator’s delegate possesses at any time investmentdirections as to the phantom investment of less than all of a Participant’sMonetary Fee Subaccount, the Participant shall be deemed to have directed thatthe undesignated portion of the Monetary Fee Subaccount be invested in a moneymarket phantom investment option offered under the Plan (or if no money marketinvestment option is offered, the investment option that most nearly resemblesa money market investment option).

 

(e)                                  Earnings or Losses. As of eachValuation Date, a Participant’s  MonetaryFee Subaccount shall be credited with earnings and gains (and  shall be debited for expenses and losses)determined as if the amounts  credited tohis or her Monetary Fee Subaccount had actually been invested  as directed by the Participant in accordancewith this Article. The Plan provides only for “phantom investments,” andtherefore such earnings, gains, expenses and losses are hypothetical and notactual. However, they shall be applied to measure the value of a Participant’sMonetary Fee Subaccount and the amount of the Company’s liability to makedeferred payments to or on behalf of the Participant.

 

5.03                           Phantom Investment of Stock FeeSubaccount.

 

(a)                                  Phantom Investment in Stock.Deferrals held in a Stock Fee Subaccount shall be invested in phantom Companystock. Stock Fees deferred into this phantom option are converted using aone-to-one ratio to an equivalent number of phantom units of Stock. Thereafter,the value of the phantom units shall be determined from time to time undersubsection (c) below.

 

(b)                                 Dividend Equivalents. A Participant’sStock Fee Subaccount shall also be credited with Dividend Equivalents asprovided in this subsection. Dividend Equivalents paid in Stock shall beconverted using a one-to-one ratio to an equivalent number of phantom units ofStock (with any fractional share being converted to a fractional unit), andthereafter shall be credited to the Participant’s Stock Fee Subaccount.Dividend Equivalents paid in cash or other property shall be converted intophantom units of Stock (or a fraction of a unit) by dividing the amount of thecash or the value of the other property by the Fair Market Value of a share ofStock on the date as of which the phantom units are to be credited to theParticipant’s Stock Fee Subaccount. Thereafter, the value of the phantom unitscredited under this subsection shall be determined from time to time undersubsection (c) below.

 

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(c)                                  Valuation of Phantom Stock. AParticipant’s interest in phantom Company stock shall be valued as of aValuation Date by multiplying the number of phantom units credited to his orher Stock Fee Subaccount on such date by the Fair Market Value of a share ofStock on such date. If shares of Stock change by reason of any stock split,stock dividend, recapitalization, merger, consolidation, spin-off, combinationor exchange of shares or other any other corporate change treated as subject tothis provision by the Plan Administrator, such equitable adjustment shall bemade in the number and kind of phantom units credited to the Stock FeeSubaccount as the Plan Administrator may determine to be necessary orappropriate. In no event will shares of Stock actually be purchased or heldunder this Plan, and no Participant shall have any rights as a shareholder ofStock on account of an interest in this phantom investment option.

 

5.04                           Vesting of a Participant’s Account.

 

A Participant’sinterest in the value of his or her Account shall at all times be 100 percentvested, which means that it will not forfeit as a result of his or herSeparation from Service. However, a Participant’s right to be paid by theCompany remains subject to the claims of the general creditors of the Company.

 

ARTICLE VI - DISTRIBUTIONS

 

6.01                           General.

 

A Participant’sAccount shall be distributed as provided in this Article. In no event shall anyportion of a Participant’s Account be distributed earlier than is allowed underSection 409A.

 

6.02                           Distribution of Monetary FeeSubaccount Upon Separation from Service.

 

A Participant’sMonetary Fee Subaccount shall be distributed upon the occurrence of aParticipant’s Separation from Service based on the terms and conditions of thissection.

 

(a)                               Distribution of Monetary FeeSubaccount. Subject to subsection (c), upon a Participant’s Separation fromService, the value of the Participant’s Monetary Fee Subaccount shall bedistributed (in accordance with subsection (b)) as soon as practicable afterthe occurrence of the first Distribution Date that follows his or herSeparation from Service (but in no event later than the later of December 31stof the year that includes such Distribution Date and 2 1⁄2 months following suchDistribution Date).

 

(b)                                 Form of Distribution. Subjectto subsection (c), if the Participant has made a form of payment election(i.e., lump sum or installments) pursuant to Section 4.03, then

 

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distributionof the Participant’s Monetary Fee Subaccount shall be made pursuant to suchform of payment election. If the Participant has not made a form of paymentelection or if the Participant’s election is not valid, then the Participant’sMonetary Fee Subaccount shall be distributed as follows:

 

(1)                                  If the total balance of theParticipant’s Monetary Fee Subaccount, as of the first Distribution Date nextfollowing the Separation from Service, is less than the applicable dollaramount under Section 402(g)(1)(B) of the Code, the Participant’sMonetary Fee Subaccount shall be distributed to the Participant as a singlelump sum as soon as practicable after the first Distribution Date that followsthe Participant’s Separation from Service (but in no event later than the laterof December 31st of the year that includes such Distribution Date and 2 1⁄2months following such Distribution Date); or

 

(2)                                  If the total balance of theParticipant’s Monetary Fee Subaccount, as of the first Distribution Date nextfollowing the Separation from Service, is is more than the applicable dollaramount under Section 402(g)(1)(B) of the Code, the participant’s Monetary FeeSubaccount shall be distributed in annual installments over a period of 5 yearswith the first installment being paid as soon as practicable after the firstDistribution Date that follows the Participant’s Separation from Service (butin no event later than the later of December 31st of the year thatincludes such Distribution Date and 2 1⁄2 months following such DistributionDate).

 

All paymentsshall be made in cash, unless the Plan Administrator makes an advancedetermination, in its discretion, to settle deferrals in units of the mutualfunds in which the Participant was invested on a phantom basis at the time suchdistribution is processed.

 

(c)                                  Special Rule for Key Employees.If the Participant is a Key Employee as of December 31st of theyear prior to the year in which the Participant’s Separation from Serviceoccurs, then no distribution may be made before the date which is 6 monthsafter the date of the Participant’s Separation from Service (or, if earlier,the date of death of the Participant).

 

6.03                           Distribution of Stock Fee SubaccountUpon Separation from Service.

 

A Participant’sStock Fee Subaccount shall be distributed upon the occurrence of a Participant’sSeparation from Service based on the terms and conditions of this section.

 

(a)                                  Distribution of Stock FeeSubaccount. Subject to subsection (c) below, upon a Participant’sSeparation from Service, the value of the Participant’s Stock Fee

 

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Subaccountshall be distributed (in accordance with subsection (b)) as soon as practicableafter the occurrence of the first Distribution Date that follows his or herSeparation from Service (but in no event later than the later of December 31stof the year that includes such Distribution Date and 2 1⁄2 months following suchDistribution Date).

 

(b)                                 Form of Distribution. Subjectto subsection (c) below, if the Participant has made a form of paymentelection (i.e., lump sum or installments) pursuant to Section 4.03, thendistribution of the Participant’s Stock Fee Subaccount shall be made pursuantto such form of payment election. Such distribution shall be accomplished byconverting the number of the Participant’s phantom units credited to his or herStock Fee Subaccount into an equivalent number of shares of Stock using aone-to-one ratio. Notwithstanding the preceding, any fractional stock unitcredited to the Participant’s Stock Fee Subaccount shall be distributed as cash.If the Participant has not made a form of payment election or if theParticipant’s election is not valid, then the Participant’s Stock FeeSubaccount shall distributed to the Participant in one lump sum in the form ofshares of Stock on the first Distribution Date following that follows his orher Separation from Service (but in no event later than the later of December 31st  of the year that includes such DistributionDate and 2 1⁄2 months following such Distribution Date).

 

(c)                                  Special Rule for Key Employees.If the Participant is a Key Employee as of December 31st of theyear prior to the year in which the Participant’s Separation from Serviceoccurs, then no distribution may be made before the date which is 6 monthsafter the date of the Participant’s Separation from Service (or, if earlier,the date of death of the Participant).

 

6.04                           Distributions on Account of Death.

 

Subject to thenext sentence, upon a Participant’s death, his or her Beneficiary shall be paideach Deferral Subaccount still standing to the Participant’s credit under thePlan on the first Distribution Date occurring in the year after the Participant’sdeath, provided that the Plan Administrator’s has received notification of theParticipant’s death. Any claim to be paid any amounts standing to the credit ofa Participant in connection with the Participant’s death must be received bythe Plan Administrator at least 14 days before any such amount is paid out bythe Plan Administrator. Any claim received thereafter is untimely, and it shallbe unenforceable against the Plan, the Company, the Plan Administrator, thePlan Administrator’s delegate or any other party acting for one or more ofthem.

 

6.05                           Acceleration of Payments.

 

Pursuant tothe rules and provisions of this section, payment of one or more specificdeferrals may be made earlier than specified in Sections 6.02 and 6.03.

 

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(a)                                  Disability Payments. If the PlanAdministrator determines that a Participant is suffering from a Disability, theParticipant’s Account shall be distributed in a lump sum as soon as practicableafter the first Distribution Date following such determination.

 

(b)                                 Unforeseeable Emergency. If aParticipant believes an Unforeseeable Emergency has occurred, the Participantor Beneficiary may file a written request with the Plan Administrator foraccelerated payment of all or a portion of the amount credited to his or herAccount. After a Participant has filed a written request pursuant to thissubsection, along with all supporting material, the Plan Administrator’sdelegate shall determine within 60 days (or such other number of days that isnecessary if special circumstances warrant additional time) whether theParticipant meets the criteria for an Unforeseeable Emergency. If the PlanAdministrator’s delegate determines that an Unforeseeable Emergency hasoccurred, the Participant or Beneficiary shall receive a distribution from hisor her Account as soon as administratively practicable. However, suchdistribution shall not exceed the dollar amount necessary to satisfy theUnforeseeable Emergency plus amounts necessary to pay taxes reasonablyanticipated as a result of the distribution, after taking into account theextent to which the Unforeseeable Emergency is or may be relieved throughreimbursement or compensation by insurance or otherwise or by liquidation ofthe Participant’s assets (to the extent the liquidation of such assets wouldnot itself cause severe financial hardship).

 

6.06                           Valuation.

 

In determiningthe amount of any individual distribution pursuant to this Article, theParticipant’s Deferral Subaccount shall continue to be credited with earningsand gains (and debited for expenses and losses) as specified in Article Vuntil the Valuation Date preceding the distribution. In determining the valueof a Participant’s remaining Monetary Fee Subaccount following an installmentdistribution, such installment distribution shall reduce the value of theParticipant’s Monetary Fee Subaccount as of the close of the Valuation Datepreceding the payment date for such installment. The amount to be distributedin connection with any installment payment shall be determined by dividing thevalue of a Participant’s Monetary Fee Subaccount as of such preceding ValuationDate (determined without application of the preceding sentence of this section)by the remaining number of installments to be paid with respect to the MonetaryFee Subaccount.

 

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ARTICLE VII - PLAN ADMINISTRATION

 

7.01                           Plan Administrator.

 

The PlanAdministrator is responsible for the administration of the Plan. The PlanAdministrator has the authority to name one or more delegates to carry outcertain responsibilities hereunder. Any such delegation shall state the scopeof responsibilities being delegated.

 

7.02                           Action.

 

Action by thePlan Administrator may be taken in accordance with procedures that the PlanAdministrator adopts from time to time or that the Company’s Law Departmentdetermines are legally permissible.

 

7.03                           Powers of the Plan Administrator.

 

The PlanAdministrator shall administer and manage the Plan and shall have (and shall bepermitted to delegate) all powers necessary to accomplish that purpose,including (but not limited to) the following:

 

(a)                                  To exercise its discretionaryauthority to construe, interpret, and administer this Plan;

 

(b)                                 To exercise its discretionaryauthority to make all decisions regarding eligibility, participation anddeferrals, to make allocations and determinations required by this Plan, and tomaintain records regarding Participants’ Accounts;

 

(c)                                  To compute and certify to theCompany the amount and kinds of  paymentsto Participants or their Beneficiaries, and to determine the time and manner inwhich such payments are to be paid;

 

(d)                                 To authorize all disbursements bythe Company pursuant to this Plan;

 

(e)                                  To maintain (or cause to bemaintained) all the necessary records for administration of this Plan;

 

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(f)                                    To make and publish such rules forthe regulation of this Plan as are not inconsistent with the terms hereof;

 

(g)                                 To authorize its delegates todelegate to other individuals or entities from time to time the performance ofany of its delegates’ duties or responsibilities hereunder;

 

(h)                                 To establish or to change thephantom investment options or arrangements under Article V;

 

(i)                                     To hire agents, accountants,actuaries, consultants and legal counsel to assist in operating andadministering the Plan; and

 

(j)                                     Notwithstanding any other provisionof this Plan, the Plan Administrator may take any action it deems appropriatein furtherance of any policy of the Company respecting insider trading as maybe in effect from time to time. Such actions may include, but are not limitedto, altering the effective date of allocations or distributions of Accounts orDeferral Subaccounts.

 

The PlanAdministrator has the exclusive and discretionary authority to construe and tointerpret the Plan, to decide all questions of eligibility for benefits, todetermine the amount and manner of payment of such benefits and to make anydeterminations that are contemplated by (or permissible under) the terms ofthis Plan, and its decisions on such matters will be final and conclusive onall parties. Any such decision or determination shall be made in the absoluteand unrestricted discretion of the Plan Administrator, even if (1) suchdiscretion is not expressly granted by the Plan provisions in question, or (2) adetermination is not expressly called for by the Plan provisions in question,and even though other Plan provisions expressly grant discretion or call for adetermination. As a result, benefits under this Plan will be paid only if thePlan Administrator decides in its discretion that the applicant is entitled tothem. In the event of a review by a court, arbitrator or any other tribunal,any exercise of the Plan Administrator’s discretionary authority shall not bedisturbed unless it is clearly shown to be arbitrary and capricious.

 

7.04                           Compensation, Indemnity andLiability.

 

The PlanAdministrator will serve without bond and without compensation for serviceshereunder. All expenses of the Plan and the Plan Administrator will be paid bythe Company. To the extent deemed appropriate by the Plan Administrator, anysuch expense may be charged against specific Participant Accounts, therebyreducing the obligation of the Company. No member of the Plan Committee, and noindividual acting as the delegate of the Plan Committee, shall be liable forany act or omission of any other member or individual, nor for any act oromission on his or her own part, excepting his or her own willful misconduct.The Company will

 

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indemnify andhold harmless each member of the Plan Committee and any employee of the Company(or an affiliate, if recognized as an affiliate for this purpose by the PlanAdministrator) acting as the delegate of the Plan Committee against any and allexpenses and liabilities, including reasonable legal fees and expenses, arisingout of his or her membership on the Plan Committee (or his or her serving asthe delegate of the Committee), excepting only expenses and liabilities arisingout of his or her own willful misconduct.

 

7.05                           Taxes.

 

If the wholeor any part of any Participant’s Account becomes liable for the payment of anyestate, inheritance, income, employment, or other tax which the Company may berequired to pay or withhold, the Company will have the full power and authorityto withhold and pay such tax out of any moneys or other property in its handfor the account of the Participant. To the extent practicable, the Company willprovide the Participant notice of such withholding. Prior to making anypayment, the Company may require such releases or other documents from anylawful taxing authority as it shall deem necessary.

 

7.06                           Conformance with Section 409A.

 

At all timesduring each Plan Year, this Plan shall be operated in accordance with therequirements of Section 409A. Any action that may be taken (and, to theextent possible, any action actually taken) by the Plan Administrator or theCompany shall not be taken (or shall be void and without effect), if suchaction violates the requirements of Section 409A. Any provision in thisPlan document that is determined to violate the requirements of Section 409Ashall be void and without effect. In addition, any provision that is requiredto appear in this Plan document that is not expressly set forth shall be deemedto be set forth herein, and the Plan shall be administered in all respects asif such provision were expressly set forth.

 

ARTICLE VIII - CLAIMS PROCEDURES

 

8.01                           Claims for Benefits.

 

If aParticipant, Beneficiary or other person (hereafter, “Claimant”) does notreceive timely payment of any benefits which he or she believes are due andpayable under the Plan, he or she may make a claim for benefits to the PlanAdministrator. The claim for benefits must be in writing and addressed to thePlan Administrator. If the claim for benefits is denied, the Plan Administratorwill notify the Claimant within 90 days after the Plan Administrator initiallyreceived the benefit claim. However, if special circumstances require anextension of time for processing the claim, the Plan Administrator will furnishnotice of the extension to the Claimant prior to the termination of the initial90-day period and such extension may not exceed one additional, consecutive90-day period. Any notice of a denial of benefits should advise the

 

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Claimant ofthe basis for the denial, any additional material or information necessary forthe Claimant to perfect his or her claim, and the steps which the Claimant musttake to appeal his or her claim for benefits.

 

8.02                           Appeals of Denied Claims.

 

Each Claimantwhose claim for benefits has been denied may file a written appeal for a reviewof his or her claim by the Plan Administrator. The request for review must befiled by the Claimant within 60 days after he or she received the noticedenying his or her claim. The decision of the Plan Administrator will becommunicated to the Claimant within 60 days after receipt of a request forappeal. The notice shall set forth the basis for the Plan Administrator’sdecision. If there are special circumstances which require an extension of timefor completing the review, the Plan Administrator’s decision may be renderednot later than 120 days after receipt of a request for appeal.

 

8.03                           Special Claims Procedures forDisability Determinations.

 

If the claimor appeal of the Claimant relates to Disability benefits, such claim or appealshall be processed pursuant to the applicable provisions of Department of LaborRegulation section 2560.503-1 relating to Disability benefits, includingsections 2560.503-1(d), 2560.503-1(f)(3), 2560.503-1(h)(4) and2560.503-1(i)(3).

 

ARTICLE IX - AMENDMENT ANDTERMINATION

 

9.01                           Amendments.

 

The applicablecommittee of the Board has the right in its sole discretion to amend this Planin whole or in part at any time and in any manner, including the manner ofmaking deferral elections, the terms on which distributions are made, and theform and timing of distributions, provided that such amendments do not causethe Plan to fail to comply with Section 409A. However, except for mereclarifying amendments necessary to avoid an inappropriate windfall, no Planamendment shall reduce the amount credited to the Account of any Participant asof the date such amendment is adopted. Any amendment shall be in writing andadopted by the committee. All Participants and Beneficiaries shall be bound bysuch amendment.

 

9.02                           Termination of Plan.

 

The Companyexpects to continue this Plan, but does not obligate itself to do so. TheCompany, acting by the committee specified in Section 9.01 or through itsBoard, reserves the right to discontinue and terminate the Plan at any time, inwhole or in part, for any reason

 

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(including achange, or an impending change, in the tax laws of the United States or anyState), provided that such termination is done in compliance with Section 409A.Termination of the Plan will be binding on all Participants and theirBeneficiaries, but in no event may such termination reduce the amounts creditedat that time to any Participant’s Account. If this Plan is terminated (in wholeor in part), the termination resolution shall provide for how amountstheretofore credited to affected Participants’ Accounts will be distributed. Inaccordance with these restrictions, the Company intends to have the maximumdiscretionary authority to terminate the Plan and make distributions inconnection with a Change in Control, and the maximum flexibility with respectto how and to what extent to carry this out following a Change in Control, asis permissible under Section 409A.

 

ARTICLE X - MISCELLANEOUS

 

10.01                     Limitation on Participant’s Rights.

 

Participationin this Plan does not give any Participant the right to be retained in theservice of the Company (or any right or interest in this Plan or any assets ofthe Company other than as herein provided). The Company reserves the right toterminate the service of any Participant without any liability for any claimagainst the Company under this Plan, except for a claim for payment ofdeferrals as provided herein.

 

10.02                     Unfunded Obligation of Company.

 

The benefitsprovided by this Plan are unfunded. All amounts payable under this Plan toParticipants are paid from the general assets of the Company. Nothing containedin this Plan requires the Company to set aside or hold in trust any amounts orassets for the purpose of paying benefits to Participants. Neither aParticipant, Beneficiary, nor any other person shall have any propertyinterest, legal or equitable, in any specific Company asset. This Plan createsonly a contractual obligation on the part of the Company, and the Participanthas the status of a general unsecured creditor of this Company with respect toamounts of compensation deferred hereunder. Such a Participant shall not haveany preference or priority over, the rights of any other unsecured generalcreditor of the Company. No other entity guarantees or shares such obligation,and no other entity shall have any liability to the Participant or his or herBeneficiary.

 

10.03                     Other Plans.

 

This Planshall not affect the right of any Eligible Director or Participant toparticipate in and receive benefits under and in accordance with the provisionsof any other benefit plans which are now or hereafter maintained by theCompany, unless the terms of such other benefit plan or plans specificallyprovide otherwise or it would cause such other plan to violate a

 

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requirementfor tax favored treatment (or it would cause this Plan or such other plan tofail to comply with Section 409A).

 

10.04                     Receipt or Release.

 

Any payment toa Participant in accordance with the provisions of this Plan shall, to theextent thereof, be in full satisfaction of all claims against the PlanAdministrator and the Company, and the Plan Administrator may require suchParticipant, as a condition precedent to such payment, to execute a receipt andrelease to such effect (provided that, to the extent the Company or the PlanAdministrator require a Participant to execute a release, the releaserequirement shall be structured in a manner that complies with Section 409A).

 

10.05                     Governing Law.

 

This Planshall be construed, administered, and governed in all respects in accordancewith applicable federal law and, to the extent not preempted by federal law, inaccordance with the laws of the State of Delaware (other than its laws relatingto choice of law). If any provisions of this instrument shall be held by acourt of competent jurisdiction to be invalid or unenforceable, the remainingprovisions hereof shall continue to be fully effective.

 

10.06                     Gender, Tense and Examples.

 

In this Plan,whenever the context so indicates, the singular or plural number and themasculine, feminine, or neuter gender shall be deemed to include the other.Whenever an example is provided or the text uses the term “including” followedby a specific item or items, or there is a passage having a similar effect,such passage of the Plan shall be construed as if the phrase “withoutlimitation” followed such example or term (or otherwise applied to such passagein a manner that avoids limitation on its breadth of application).

 

10.07                     Successors and Assigns;Nonalienation of Benefits.

 

This Planinures to the benefit of and is binding upon the parties hereto and theirsuccessors, heirs and assigns; provided, however, that the amounts credited tothe Account of a Participant are not subject in any manner to anticipation,alienation, sale, transfer, assignment, pledge, encumbrance, charge,garnishment, execution or levy of any kind, either voluntary or involuntary,and any attempt to anticipate, alienate, sell, transfer, assign, pledge,encumber, charge or otherwise dispose of any right to any benefits payablehereunder, including, any assignment or alienation in connection with aseparation, divorce, child support or similar arrangement, will be null andvoid and not binding on the Plan or the Company. Notwithstanding the foregoing,the Plan Administrator reserves the right to make payments in accordance with adivorce decree, judgment or other court order as and when cash payments aremade in

 

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accordancewith the terms of this Plan from the Deferral Subaccount of a Participant. Anysuch payment shall be charged against and reduce the Participant’s Account.

 

10.08                     Facility of Payment.

 

Whenever, inthe Plan Administrator’s opinion, a Participant or Beneficiary entitled toreceive any payment hereunder is under a legal disability or is incapacitatedin any way so as to be unable to manage his or her financial affairs, the PlanAdministrator may direct the Company to make payments to such person or to thelegal representative of such person for his or her benefit, or to apply thepayment for the benefit of such person in such manner as the Plan Administratorconsiders advisable. Any payment in accordance with the provisions of thissection shall be a complete discharge of any liability for the making of suchpayment to the Participant or Beneficiary under the Plan.

 

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