EX-10.2 Incentive Plan



 











Exhibit 10.2




HARRIS CORPORATION




2005 ANNUAL INCENTIVE PLAN




(Effective as of July 2, 2005)



     
1. Purpose of the Plan. The purpose of the
Harris Corporation 2005 Annual Incentive Plan is to promote the
growth and performance of the Company by: (i) linking a
portion of the total annual compensation for certain key
employees to attainment of such corporate, subsidiary, division
and business unit objectives as shall be approved for each Plan
Year; and (ii) assisting in the attraction, retention and
motivation of certain key employees.



     
2. Definitions. Wherever the following
capitalized terms are used in the Plan, they shall have the
meanings specified below:






		
	 	     
    “Affiliate” means any entity that is directly
    or indirectly controlled by the Company or any entity in which
    the Company has a significant ownership interest, as determined
    by the Committee.
	 
	 	     
    “Award” means a right to receive an annual cash
    incentive payment pursuant to the terms and conditions of the
    Plan.
	 
	 	     
    “Board” means the Board of Directors of the
    Company.
	 
	 	     
    “Change of Control” shall have the meaning set
    forth in Section 13(b).
	 
	 	     
    “Code” means the Internal Revenue Code of 1986,
    as amended.
	 
	 	     
    “Committee” means a committee of the Board
    designated by the Board to administer the Plan which shall be
    comprised solely of three or more Independent Directors.
	 
	 	     
    “Company” means Harris Corporation, a Delaware
    corporation.
	 
	 	     
    “Director” means a member of the Board.
	 
	 	     
    “Employee” means any salaried employee of the
    Company, any Subsidiary or any Affiliate, including any officers
    or Executive Officers (whether or not a Director), who is
    treated as an employee in the personnel records of the Company
    or its Subsidiaries or Affiliates for the relevant period, but
    shall exclude individuals who are classified by the Company, any
    Subsidiary or any Affiliate as (i) leased or otherwise
    employed by a third party; (ii) independent contractors; or
    (iii) intermittent or temporary, in each case even if any
    such classification is changed retroactively as a result of an
    audit, litigation, or otherwise.
	 
	 	     
    “Exchange Act” means the Securities Exchange
    Act of 1934, as amended.
	 
	 	     
    “Executive Officer” means a Participant the
    Board has designated as an executive officer of the Company for
    purposes of reporting under the Exchange Act.
	 
	 	     
    “Independent Director” means a Director who is
    not an Employee and who qualifies as (i) a
    “non-employee director” under Rule 16b-3(b)(3)
    under the Exchange Act, (ii) an “outside
    director” under Section 162(m) of the Code, and
    (iii) an “independent director” under the rules
    and listing standards adopted by the New York Stock Exchange.
	 
	 	     
    “Participant” means any Employee designated by
    the Board, the Committee or the Chief Executive Officer of the
    Company to participate in the Plan for a Plan Year or a portion
    of a Plan Year.
	 
	 	     
    “Performance Objectives” means the performance
    objectives established pursuant to the Plan for Participants.
    Performance Objectives may be described in terms of Company-wide
    objectives or objectives that are related to the performance of
    the individual Participant or the Subsidiary, division, business
    unit, department or function with the Company in which the
    Participant is employed.



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    Performance Objectives may be measured on an absolute or
    relative basis. Relative performance may be measured by a group
    of peer companies or by a financial market index. Any
    Performance Objectives applicable to a Qualified
    Performance-Based Award shall be limited to specified levels of
    or increases in return on equity, diluted earnings per share,
    total earnings, earnings growth, return on capital, return on
    assets, return on sales, earnings before interest and taxes,
    revenue, revenue growth, gross margin, return on investment,
    increase in the fair market value of shares, share price
    (including, but not limited to, growth measures and total
    stockholder return), operating profit, net earnings, cash flow
    (including, but not limited to, operating cash flow and free
    cash flow), inventory turns, financial return ratios, market
    share, earnings measures/ratios, economic value added, balance
    sheet measurements (such as receivable turnover), internal rate
    of return, customer satisfaction
    surveys or productivity.
	 
	 	     
    “Plan” means this Harris Corporation 2005
    Annual Incentive Plan, as amended from time to time.
	 
	 	     
    “Plan Year” means a fiscal year of the Company.
	 
	 	     
    “Qualified Performance-Based Award” means any
    Award or portion of an Award that is intended to satisfy the
    requirements for “qualified performance-based
    compensation” under Section 162(m) of the Code.
	 
	 	     
    “Subsidiary” means any entity, either directly
    or indirectly, of which the Company owns or controls 50% or more
    of the outstanding shares of stock normally entitled to vote for
    the election of directors or of comparable equity participation
    and voting power.




     
3. Administration of Plan.






		
	 	     
    (a) Powers of Committee; Discretion. The Plan
    shall be administered by the Committee. With respect to
    participation in the Plan by the Chief Executive Officer or any
    other Executive Officer that is also a Director, the Plan shall
    be administered by the Committee with the other Independent
    Directors of the Board. Subject to the terms of the Plan, the
    Committee shall have such powers and authority as may be
    necessary or appropriate for the Committee to carry out its
    functions as described in the Plan. The Committee shall have the
    authority in its discretion to determine: (i) which
    Employees shall receive Awards; (ii) the amount of the
    Awards; and (iii) the objectives and the other terms and
    conditions of such Awards, including the Performance Objectives,
    targets and other terms and conditions of an Award.
    Determinations by the Committee under the Plan, including
    without limitation, determinations of the Participants, the
    amount and timing of Awards, the terms and provisions of Awards,
    need not be uniform and may be made selectively among
    Participants and Employees who receive or are eligible to
    receive Awards. The Committee shall have the full power,
    discretion and authority to interpret the Plan, to establish,
    amend, suspend and rescind any rules and regulations relating to
    the Plan and to make all other determinations that it deems
    necessary or advisable for the administration of the Plan. The
    Committee may correct any defect, supply any omission or
    reconcile any inconsistency in the Plan or any Award in the
    manner and to the extent it shall deem desirable to carry it
    into effect. All such determinations shall be final, conclusive
    and binding on all persons (including the Company and
    Participants) and for all purposes.
	 
	 	     
    (b) Board Authority. If the Committee does not
    exist, or for any other reason determined by the Board, the
    Board may take any action under the Plan that would otherwise be
    the responsibility of the Committee.
	 
	 	     
    (c) Delegation. Except to the extent prohibited
    by applicable law and the listing requirements of the New York
    Stock Exchange, the Committee shall have the right, from time to
    time, to delegate to one or more officers of the Company the
    authority of the Committee to grant and determine the terms and
    conditions of Awards granted under the Plan, subject to such
    limitations as the Committee shall determine. In no event shall
    any such delegation of authority be permitted with respect to
    Awards to any Executive Officer or any person subject to
    Section 162(m) of the Code. The Committee shall also be
    permitted to delegate, to any appropriate officer or employee of
    the



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    Company, responsibility for performing certain ministerial
    functions under the Plan. In the event that the Committee’s
    authority is delegated to officers or employees in accordance
    with the foregoing, all references in the Plan relating to the
    Committee shall be interpreted in a manner consistent with the
    foregoing by treating any such reference as a reference to such
    officer or employee for such purpose. Any action undertaken in
    accordance with the Committee’s delegation of authority
    hereunder shall have the same force and effect as if such action
    was undertaken directly by the Committee and shall be deemed for
    all purposes of the Plan to have been taken by the Committee.
	 
	 	     
    (d) Limitation on Liability. No member of the
    Board or Committee, nor any officer delegated authority by the
    Committee, shall be liable for any action or determination made
    in good faith by the Board, Committee or such officer with
    respect to the Plan or any Award.




     
4. Eligibility; Designation of
Participants. All Employees are eligible to be
designated by the Committee to receive Awards and become
Participants under the Plan. Participants in the Plan shall be
selected by the Committee on an annual basis. In selecting
Employees to be Participants and in determining the amount of an
Award to be granted under the Plan and the terms and conditions
of the Award, the Committee shall consider any and all factors
that it deems relevant or appropriate. Awards need not be
uniform and may be made selectively among Participants and
Employees who receive or are eligible to receive awards.



     
5. Annual Incentive Awards.






		
	 	     
    (a) In General. Each Participant in the Plan
    shall be eligible to receive such Award, if any, for each Plan
    Year as may be payable pursuant to the Performance Objectives
    and criteria applicable for such Participant. Except as provided
    in Section 13, the Committee shall, on an annual
    basis, establish a “target annual incentive award” for
    a Participant for a Plan Year, and the maximum payout shall not
    exceed 200% of such target annual incentive award.
	 
	 	     
    (b) Performance Objectives. Participants shall
    have the payout of their annual incentive awards, if any,
    determined on the basis of the degree of achievement of
    Performance Objectives which shall be established by the
    Committee in writing and which Performance Objectives shall be
    stated in terms of the attainment of specified levels of or
    percentage changes (as compared to a prior measurement period)
    in any one or more of the Performance Objectives. The Committee
    shall, for each Plan Year, establish the Performance Objectives
    to apply to each Participant and a formula or matrix prescribing
    the extent to which such Participant’s annual incentive
    award shall be earned based upon the degree of achievement of
    such Performance Objective or Performance Objectives. The
    Committee may determine that the annual incentive award payable
    to any Participant shall be based upon the attainment of
    Performance Objectives comparable to those specified above but
    in whole or in part applied to the results of a Subsidiary,
    division or business unit. With respect to Awards intended to be
    a Qualified Performance-Based Award, the Committee shall
    determine the target annual incentive award, Performance
    Objectives and any related formula or matrix for each
    Participant not later than 90 calendar days after the beginning
    of the Plan Year.
	 
	 	     
    (c) Transfer of Employment. A
    Participant’s target annual incentive award or Performance
    Objectives may be changed by the Committee during the Plan Year
    to reflect a change in responsibilities provided that in the
    case of Awards intended to be a Qualified Performance-Based
    Award any such change shall be made in a manner consistent with
    Section 162(m) of the Code.
	 
	 	     
    (d) Committee Adjustment. Except as provided in
    Section 6 and Section 14, the Committee
    may, in its sole discretion, (i) award or increase the
    amount of an annual incentive award payable to a Participant
    even though not earned in accordance with the Performance
    Objectives established pursuant to this Section 5,
    or (ii) in the event of any unusual or nonrecurring events
    affecting the Company or its financial statements or changes in
    applicable laws, regulations or accounting principles, decrease
    the amount of an annual incentive award otherwise payable to a
    Participant even though earned in accordance with the
    performance goals established pursuant to this
    Section 5.



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6. Participation by Executive Officers.






		
	 	     
    (a) Qualified Performance-Based Awards.
    Notwithstanding any other provisions of the Plan to the
    contrary, the following provisions shall be applicable to
    participation in the Plan by Executive Officers who are subject
    to Section 162(m) of the Code:






		
	 	     
    (i) Each such Participant’s annual incentive award
    payable under this Plan for a Plan Year shall be based solely on
    achievement of one or more of the Performance Objectives as
    established by the Committee pursuant to Section 5
    above and the Committee shall not have the discretion provided
    in Section 5(d)to increase the amount of the award
    payable under this Plan but it shall in all cases have the
    ability to reduce the amount of any such award that would
    otherwise be payable (including a reduction in such amount to
    zero).
	 
	 	     
    (ii) With respect to each such Participant, no annual
    incentive award intended to be a Qualified Performance-Based
    Award shall be payable hereunder except upon written
    certification by the Committee that the Performance Objectives
    have been satisfied to a particular extent and that any other
    material terms and conditions precedent to payment of an annual
    incentive award pursuant to the Plan have been satisfied.






		
	 	     
    (b) Maximum Award. Notwithstanding any
    provisions of the Plan to the contrary, the maximum annual
    incentive award payable to any Participant who is an Executive
    Officer for any Plan Year shall be $6,000,000; provided,
    however, that if such a Participant is not a Participant for the
    entire Plan Year, the maximum amount payable shall be pro-rated
    based on the number of days the individual was a Participant for
    the Plan Year.



     
7. Payment of Annual Incentive Award on Termination of
Employment.






		
	 	     
    (a) Payments. Payment of any amount to be paid to a
    Participant based upon the degree of attainment of the
    applicable Performance Objectives shall be made in cash at such
    time(s) as the Committee may in its discretion determine.
    Notwithstanding the foregoing, in no event will the payment of
    such amounts be made after the later of: (a) the date that
    is
    21/2
    months from the end of the Participant’s first taxable year
    in which the amount is no longer subject to a substantial risk
    of forfeiture or (b) the date that is
    21/2
    months from the end of the Corporation’s first taxable year
    in which the amount is no longer subject to a substantial risk
    of forfeiture.
	 
	 	     
    (b) Termination of Employment. Except to the
    extent otherwise provided by the Committee, if a
    Participant’s employment with the Company, any Subsidiary
    or any Affiliate, is terminated for any reason prior to the last
    day of a Plan Year, then, except in the case of death,
    disability or normal retirement, or an involuntary termination
    due to a reduction in force or except as provided in
    Section 13, the Participant shall forfeit the Award
    and shall not be entitled to a payment of the annual incentive
    award. If a Participant’s employment is terminated during
    the Plan Year due to death, disability, normal retirement or
    involuntary termination caused by a reduction in force, the
    Participant shall be entitled to a pro-rated payment of the
    annual incentive award that would have been payable if the
    Participant had been a Participant on the last day of the Plan
    Year. If a Participant is entitled to a payment of the annual
    incentive award pursuant to the preceding sentence, such amount
    shall be prorated based on the number of days the individual was
    a Participant in the Plan for such Plan Year and shall be paid
    at the same time and in the same manner as such payment would
    have been made if the Participant had been a Participant on the
    last day of the Plan Year. A leave of absence, approved by the
    Committee, shall not be deemed to be a termination of employment
    for purposes of this Plan.



     
8. Unfunded Plan. A Participant’s interest
in any Awards hereunder shall at all times be reflected on the
Company’s books as a general unsecured and unfunded
obligation of the Company subject to the terms and conditions of
the Plan. The Plan shall not give any person any right or
security interest in any asset of the Company or any fund in
which any deferred payment is deemed invested. Neither the
Company, the Board, nor the Committee shall be responsible for
the adequacy of the general assets of the Company to



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discharge the payment of its obligations hereunder nor shall the
Company be required to reserve or set aside funds therefor.



     
9. Non-Alienation of Benefits; Beneficiary
Designation. All rights and benefits under the Plan are
personal to the Participant and neither the Plan nor any right
or interest of a Participant or any other person arising under
the Plan is subject to voluntary or involuntary alienation,
sale, transfer, or assignment without the Company’s
consent. Subject to the foregoing, the Company shall establish
such procedures as it deems necessary for a Participant to
designate one or more beneficiaries to whom any payment the
Committee determines to make would be payable in the event of
the Participant’s death. In the event no beneficiary has
been properly designated, the payment shall be made to the
Participant’s surviving spouse or, if none, the
Participant’s estate.



     
10. Withholding for Taxes. Notwithstanding any
other provisions of this Plan, the Company shall have the
authority to withhold from any payment made by it under the Plan
such amount or amounts as may be required for purposes of
complying with any Federal, state and local tax or withholding
requirements.



     
11. No Right to Continued Employment or to
Participate. Nothing in the Plan or in the grant of any
Award shall interfere with or limit in any way the right of the
Company or any of its Subsidiaries or Affiliates to terminate a
Participant’s employment at any time, nor confer upon any
Participant any right to continued employment with the Company
or any of its Subsidiaries or Affiliates. Neither the adoption
of the Plan nor any action by the Committee shall be deemed to
give any Employee any right to be designated as a Participant
under the Plan.



     
12. Non-Exclusivity of Plan. This Plan is not
intended to and shall not preclude the Board from adopting,
continuing, amending or terminating such additional compensation
arrangement as it deems desirable for Employees.



     
13. Change of Control.






		
	 	     
    (a) Impact of Change of
    Control. Notwithstanding anything to the contrary
    provided elsewhere herein, in the event of a “Change of
    Control” of the Company, as defined in
    Section 13(b), then the Company shall as promptly as
    practicable following the effective date of the Change of
    Control pay any incentive Awards payable to Participants. The
    payment to each Participant shall be an amount not less than the
    target annual incentive award as originally approved for the
    Plan Year, notwithstanding actual results or any changes or
    modifications occurring after any such Change of Control.
	 
	 	     
    (b) Definition. For purposes hereof, a
    “Change of Control” shall be deemed to have
    occurred if:






		
	 	     
    (i) any “person” (as such term is defined in
    Section 3(a)(9) of the Exchange Act and as used in
    Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or
    becomes a “beneficial owner” (as defined in
    Rule 13d-3 under the Exchange Act), directly or indirectly,
    of securities of the Company representing 20% or more of the
    combined voting power of the Company’s then outstanding
    securities eligible to vote for the election of the Board (the
    “Company Voting Securities”); provided,
    however, that the event described in this
    paragraph (i) shall not be deemed to be a Change of
    Control by virtue of any of the following acquisitions:
    (a) by the Company or any Subsidiary, (b) by any
    employee benefit plan sponsored or maintained by the Company or
    any Subsidiary, (c) by any underwriter temporarily holding
    securities pursuant to an offering of such securities, or
    (d) pursuant to a Non-Control Transaction (as defined in
    paragraph (iii));
	 
	 	     
    (ii) individuals who, on July 1, 2005, constitute the
    Board (the “Incumbent Directors”) cease for any
    reason to constitute at least a majority of the Board, provided
    that any person becoming a Director subsequent to July 1,
    2005, whose election or nomination for election was approved by
    a vote of at least two-thirds of the Incumbent Directors who
    remain on the Board (either by a specific vote or by approval of
    the proxy statement of the Company in which such



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    person is named as a nominee for Director, without objection to
    such nomination) shall also be deemed to be an Incumbent
    Director; provided, however, that no individual
    initially elected or nominated as a Director of the Company as a
    result of an actual or threatened election contest with respect
    to Directors or any other actual or threatened solicitation of
    proxies or consents by or on behalf of any person other than the
    Board of Directors shall be deemed to be an Incumbent Director;
	 
	 	     
    (iii) the consummation of a merger, consolidation, share
    exchange or similar form of corporate reorganization of the
    Company or any such type of transaction involving the Company or
    any of its subsidiaries that requires the approval of the
    Company’s stockholders (whether for such transaction or the
    issuance of securities in the transaction or otherwise) (a
    “Business Combination”), unless immediately
    following such Business Combination: (a) more than 80% of
    the total voting power of the corporation resulting from such
    Business Combination (including, without limitation, any
    corporation which directly or indirectly has beneficial
    ownership of 100% of the Company Voting Securities) eligible to
    elect Directors of such Company is represented by shares that
    were Company Voting Securities immediately prior to such
    Business Combination (either by remaining outstanding or being
    converted), and such voting power is in substantially the same
    proportion as the voting power of such Company Voting Securities
    immediately prior to the Business Combination, (b) no
    person (other than any publicly traded holding company resulting
    from such Business Combination, any employee benefit plan
    sponsored or maintained by the Company (or the corporation
    resulting from such Business Combination)) becomes the
    beneficial owner, directly or indirectly, of 20% or more of the
    total voting power of the outstanding voting securities eligible
    to elect Directors of the Company resulting from such Business
    Combination, and (c) at least a majority of the members of
    the Board of Directors of the corporation resulting from such
    Business Combination were Incumbent Directors at the time of the
    Board’s approval of the execution of the initial agreement
    providing for such Business Combination (any Business
    Combination which satisfies the foregoing conditions specified
    in (a), (b) and (c) shall be deemed to be a
    “Non-Control Transaction”); or
	 
	 	     
    (iv) the Shareholders of the Company approve a plan of
    complete liquidation or dissolution of the Company or the direct
    or indirect sale or other disposition of all or substantially
    all of the assets of the Company and its Subsidiaries.





Notwithstanding the foregoing, a “Change of Control”
of the Company shall not be deemed to occur solely because any
person acquires beneficial ownership of more than 20% of the
Company Voting Securities as a result of the acquisition of
Company Voting Securities by the Company which reduces the
number of Company Voting Securities outstanding;
provided, that if after such acquisition by the
Company such person becomes the beneficial owner of additional
Company Voting Securities that increases the percentage of
outstanding Company Voting Securities beneficially owned by such
person, a “Change of Control” of the Company shall
then occur.



     
14. Adjustment of Awards. The Committee shall
be authorized to make adjustments in the method of calculating
attainment of Performance Objectives in recognition of unusual
or nonrecurring events affecting the Company or its financial
statements or changes in applicable laws, regulations or
accounting principles; provided, however, that any
such adjustments shall be made in a manner consistent with
Section 162(m) of the Code. The Committee may not make any
such adjustment to any Qualified Performance-Based Award if such
adjustment would cause compensation pursuant to such award to
cease to be performance-based compensation under
Section 162(m) of the Code. In the event the Company shall
assume outstanding employee benefit awards or the right or
obligation to make future such awards in connection with the
acquisition of another corporation or business entity, the
Committee may, in its discretion, make such adjustments in the
terms of Awards under the Plan as it shall deem appropriate.



     
15. Impact of Restatement of Financial Statements upon
Previous Awards. If any of the Company’s financial
statements are restated as a result of errors, omissions, or
fraud, the Committee may (in its sole discretion, but acting in
good faith) direct that the Company recover all or a portion of
any such Award or



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payment made to any, all or any class of Participants with
respect to any Plan Year the financial results of which are
negatively affected by such restatement. The amount to be
recovered from any Participant shall be the amount by which the
affected Award or payment exceeded the amount that would have
been payable to such Participant had the financial statements
been initially filed as restated, or any greater or lesser
amount (including, but not limited to, the entire Award) that
the Committee shall determine. The Committee may determine to
recover different amounts from different Participants or
different classes of Participants on such basis as it shall deem
appropriate. In no event shall the amount to be recovered by the
Company from a Participant be less than the amount required to
be repaid or recovered as a matter of law. The Committee shall
determine whether the Company shall effect any such recovery
(i) by seeking repayment from the Participant, (ii) by
reducing (subject to applicable law and the terms and conditions
of the applicable plan, program or arrangement) the amount that
would otherwise be payable to the Participant under any
compensatory plan, program or arrangement maintained by the
Company, a Subsidiary or any of its Affiliates, (iii) by
withholding payment of future increases in compensation
(including the payment of any discretionary bonus amount) or
grants of compensatory awards that would otherwise have been
made in accordance with the Company’s otherwise applicable
compensation practices, or (iv) by any combination of the
foregoing or otherwise.



     
16. Deferral.






		
	 	     
    (a) Section 162(m) Related
    Deferral. Notwithstanding anything contained herein to
    the contrary, if permitted under Section 409A of the Code,
    in the event that all or a portion of an annual incentive award
    shall be ineligible for treatment as “other
    performance-based compensation” under Section 162(m)
    of the Code, the Committee, in its sole discretion, shall have
    the right, with respect to any Executive Officer who is a
    “covered employee” under Section 162(m) of the
    Code, to defer, in whole or in part, such Executive
    Officer’s receipt of payment of his or her annual incentive
    award until the Executive Officer is no longer a “covered
    employee” or until such time as shall be determined by the
    Committee, provided that the Committee may effect such a
    deferral only in a situation where the Company would be
    prohibited a deduction under Section 162(m) of the Code and
    such deferral shall be limited to the portion of the award that
    is not deductible.
	 
	 	     
    (b) Deferrals. The Board Committee may, in its
    discretion, permit a Participant to defer the receipt of payment
    of cash that would otherwise be due to the Participant. If any
    such deferral is to be permitted by the Committee, the Committee
    shall establish rules and procedures relating to such deferral
    in a manner intended to comply with the requirements of
    Section 409A of the Code, including, without limitation,
    the time when an election to defer may be made, the time period
    of the deferral and the events that would result in payment of
    the deferred amount, the interest or other earnings attributable
    to the deferral and the method of funding, if any, attributable
    to the deferred amount.



     
17. Amendment or Termination. Until such time
as a “Change of Control” shall have occurred, the
Board or the Committee may, in its sole discretion, amend,
suspend or terminate the Plan from time to time, subject to any
requirement for shareholder approval imposed by applicable law,
including Section 162(m) of the Code, and the listing
requirements of the New York Stock Exchange. Except as provided
in Section 5(d) and Section 14, no such
termination or amendment shall alter a Participant’s right
to receive a distribution as previously earned, as to which this
Plan shall remain in effect following its termination until all
such amounts have been paid, except as the Company may otherwise
determine.



     
18. Application of Code Section 409A. To
the extent applicable, this Agreement is intended to be
administered and interpreted in a manner that is consistent with
the requirements of Section 409A of the Code.
Notwithstanding the foregoing, no particular tax result with
respect to any income recognized by a Participant in connection
with the Plan is guaranteed and each Participant shall be
responsible for any taxes imposed on him in connection with the
Plan.



     
19. Tax Penalty Avoidance. The provisions of
this Plan are not intended, and should not be construed, to be
legal, business or tax advice. The Company and any other party
having any interest herein are hereby informed that the
U.S. federal tax advice contained in this document (if any)
is not intended



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or written to be used, and cannot be used, for the purpose of
(i) avoiding penalties under the Code or
(ii) promoting, marketing or recommending to any party any
transaction or matter addressed herein.



     
20. Governing Law and Interpretation. The
validity, construction, and effect of the Plan and any rules and
regulations relating to the Plan shall be determined in
accordance with the laws of the State of Delaware, without
regard to the conflict of law principles thereof. Unless
otherwise indicated, all “Section” references are to
sections of the Plan. References to any law, rule or regulation
shall include all statutory and regulatory provisions
consolidating, amending, replacing, supplementing, or
interpreting such law, rule or regulation.



     
21. Severability. Notwithstanding any other
provision or Section of the Plan, if any provision of the Plan
is or becomes or is deemed to be invalid, illegal or
unenforceable in any jurisdiction or as to any person or award,
or would disqualify the Plan or any award under any law deemed
applicable by the Board or the Committee, such provision shall
be construed or deemed amended to conform to the applicable laws
(but only to such extent necessary to comply with such laws), or
if it cannot be construed or deemed amended without, in the
determination of the Board or the Committee, materially altering
the intent of the Plan or award, such provision shall be
stricken as to such jurisdiction, person or award and the
remainder of the Plan and any such award shall remain in full
force and effect.



     
22. Effective Date. Subject to its approval by
the shareholders, this Plan shall become effective for the 2006
fiscal year and shall remain effective until the first annual
meeting of shareholders in the 2011 fiscal year, subject to any
further shareholder approvals (or reapprovals) mandated for
performance-based compensation under Section 162(m) of the
Code, and subject to the right of the Board to terminate the
Plan, on a prospective basis only, at any time.



     
Approved and adopted by the Board of Directors this
27th day of August, 2005.






		
	 	
    Attested:
	 
	 	
    /s/ Scott T. Mikuen
    
	 	
     

	 	
    Corporate Secretary



8