f. Code — means the Internal Revenue Code of 1986, as amended.  g. Committee — means the Compensation Committee of the Board or such otherCommittee composed of no fewer than three (3) members as may be designated by the Boardto administer this Plan.  h. Company — means Keithley Instruments, Inc., or any successor thereto.  i. Disability — means (i) a Participant is unable to engage in any substantialgainful activity by reason of any medically determinable physical or mental impairmentthat can be expected to result in death or can be expected to last for a continuousperiod of not less than twelve (12) months; or (ii) a Participant is, by reason of anymedically determinable physical or mental impairment that can be expected to result indeath or can be expected to last for a continuous period of not less than twelve (12)months, receiving income replacement benefits for a period of not less than three (3)months under an accident and health plan covering employees of the Company.  j. Employee — means an individual who is employed by the Company or a Subsidiaryon a full-time basis in a managerial or executive capacity.  k. Irrevocable Election to Participate or Irrevocable Election Agreement — meansthe irrevocable election agreement which must be executed by a Participant in order forthe Employee to participate in any Year.  l. Participant — means an Employee who may receive a Performance Award or otherSupplemental Compensation in any Year and who has been designated by the Committee orits designate(s) as eligible for participation in the Plan for that Year.  m. Performance Award — means any cash bonus or Performance Award which may bepayable to an Employee.  n. Plan — means this Deferred Compensation Plan as it may be amended from time totime.  o. Retirement — means the date of retirement according to the terms of theCompany’s Employees’ Pension Plan or the terms of any Subsidiary’s pension plan.  p. Separation from Service — means a termination of employment with the Companyand all Affiliates (whether by death, retirement, or otherwise) which ends orsubstantially reduces the personal services a Participant performs (or is expected toperform) for the Company and all Affiliates. Except in the case of a Participant on abona fide leave of absence as provided below, a Participant is deemed to have incurreda Separation from Service if the level of services to be performed by the Participantafter a date certain is reasonably expected to be reduced to twenty percent (20%) orless of the average services rendered by the Participant during the immediatelypreceding 36-month period (or the total period of employment, if less than 36 months),disregarding period during which such Participant was on a bona fide leave of absence.
 
2

 
   A Participant absent from work due to military leave, sick leave, or other bona fideleave of absence shall incur a Separation from Service on the first date immediatelyfollowing the later of: (a) the six month anniversary of the commencement of theleave, or (b) the expiration of the Participant’s right, if any, to reemploymentunder statute or contract. Notwithstanding the foregoing, a Participant who isabsent due to a physical or mental impairment that is expect to result in death orlast for a continuous period of at least six months and that prevents theParticipant from performing personal services for the Company (or its Affiliates, asapplicable) shall be deemed to have incurred a Separation from Service on the firstdate immediately following the 29-month anniversary of the commencement of theleave.  q. Specified Employee — A Participant who, as of the date of his or her Separationfrom Service, is a “key employee” of the Company or any Affiliate, so long as theCompany’s stock (or the stock of any Affiliate) is publicly traded on an establishedsecurities market or otherwise. A Participant is a key employee if he or she meets therequirements of Code Section 416(i)(1)(A)(i), (ii), or (iii) (applied in accordancewith the regulations thereunder and disregarding Section 416(i)(5)) at any time duringthe 12-month period ending on a given December 31st. Such key employee shall betreated as a specified employee for the entire 12-month period beginning on the April1st next following the December 31st on which such Participant qualifies asa key employee hereunder.    For purposes of determining whether a Participant is a Specified Employee, thecompensation of the Participant shall be determined in accordance with thedefinition of compensation provided under Treasury Regulation Section 1.415(c)-2(a).Notwithstanding the foregoing, if a different definition of compensation has beendesignated by the Company with respect to another nonqualified deferred compensationplan in which a key employee participates, the definition of compensation shall bethe definition as provided under Treasury Regulation Section 1.415(c)-2(a), unlessthe Company elects (by applicable corporate action) to use a different definition ofcompensation with respect to all nonqualified deferred compensation plan maintainedby the Company.  r. Subsidiary — means any corporation at least fifty percent (50%) of the voting shares of which is owned by the Company either directly or indirectly and which hasbeen authorized by the Board to participate in the Plan.  s. Supplemental Compensation — means compensation payable to an Employee which isin addition to an Employee’s salary and which the Committee, in its sole discretion,may deem to be deferrable, either in whole or in part, under the terms and conditionsof the Plan.  t. Termination — means termination of employment for any reason other thanRetirement including death, disability, resignation or release from employment with theCompany or a Subsidiary.  u. Year or Plan Year — means the Company’s fiscal year which ends on each September 30during which the Plan is in effect.
 
3

 
2. Purpose of the PlanThe purpose of the Plan is to furnish a benefit to those Employees who contribute to thesuccess of the Company and to assist the Company in attracting and retaining such Employees.3. Establishment of the PlanThe Plan is established effective as of October 1, 1983. The effective date of thisamendment and restatement, however, is January 1, 2005.4. Administration of the PlanThe Committee shall manage and implement the provisions of the Plan. The Committee shallhave the authority to interpret the Plan, adopt and revise rules and regulations relating tothe Plan and make any other determinations which it believes necessary or advisable for theadministration of the Plan. Decisions and determinations by the Committee shall be final andbinding on Participants and other Employees except as otherwise provided in Paragraph 18.The Committee may delegate to such persons as they select any powers and duties with respectto the Plan as the Committee shall deem appropriate.5. Designation of ParticipantsThe Committee or its delegate(s) shall designate Participants in the Plan in any Year fromamong those Employees who may be eligible to receive a Bonus, Performance Award orSupplemental Compensation during that Year on the following terms: a. The Committee or its delegate(s) shall notify those Employees whom it hasselected as Participants in the Plan no later than the end of the Year in which theBonus or Supplemental Compensation is earned or the end of the Performance Period withrespect to any Performance Award.  b. The Committee may from Year to Year, at its discretion, change the eligibilityrequirements for participation in the Plan.6. Requirements for Participation a. In order to participate in any Year, the Participant must complete and returnthe Irrevocable Election Agreement no later than the dates set forth in Section 6(b)and agree to defer a minimum of twenty-five percent (25%) of any Bonus, PerformanceAward or Supplemental Compensation which the Company or Subsidiary would otherwise payto the Participant during such Year.
 
4

 
 b. If a Participant desires to defer any Bonus, Performance Award or SupplementalCompensation, or the required portion thereof, the Irrevocable Election Agreementmust be completed and returned (i) prior to the beginning of the Year in which theBonus or Supplemental Compensation is earned, or (ii) on or before six (6) monthsbefore the end of the Performance Period with respect to any Performance Award.  c. At the time the Irrevocable Election Agreement is completed, the Participantshall be required to specify the term of deferral and manner of payment in accordancewith the options provided in Section 8.  d. Completion of the Irrevocable Election Agreement as to any Bonus, PerformanceAward or Supplemental Compensation shall subject the amount deferred to all the termsand conditions of the Plan.7. Deferred Compensation AccountThe Company shall establish a bookkeeping liability, an Account, for each Participant in thePlan on the following terms: a. The Account shall serve solely as a device for determining the amount to bepaid to the Participant at the time specified for payment. The Account will not befunded by the Company or the Subsidiary and it will not constitute or be treated asfunds set aside in trust or escrow and the Participant shall have no proprietary rightof any nature with respect to such Account.  b. At such time as a Bonus, Performance Award or Supplemental Compensation wouldotherwise be paid to a Participant, his Account shall be credited with an amount equalto that portion of the Bonus, Performance Award or Supplemental Compensation which theParticipant had designated to be deferred and be subject to this Plan reduced by theEmployee’s portion of any Social Security taxes which are payable with respect to thedeferred amounts.  c. As of September 30 in each Year, a Participant’s Account shall be credited withinterest. The rate of such interest shall equal the average of the prime rates ofinterest for large money center banks as reported in the Wall Street Journal for thelast day of such September for which such rates are reported and the last day of theDecember, March and June last preceding such September and for which such rates arereported. Such interest shall be credited on the average daily balance credited to theaccount during the twelve (12) month period ending on such September 30th.  d. Amounts payable to a Participant or beneficiary pursuant to this Plan shall bedebited to his Account as of the date of payment. In the event a Participant orbeneficiary shall be entitled to receive the full amounts then credited to his Account,he shall also be paid interest for the period from the preceding October 1 until thedate of payment. The rate of such interest shall equal the average of the prime ratesof interest for large money center banks as reported in the Wall Street Journal for thelast day of the December, March, June and September last preceding the date of paymentand for which such rates are reported. Payment of such interest shall be in lieu ofinterest for such Year under paragraph c above.
 
5

 
8. Payments of Deferred Compensation a. The Participant shall specify the end of the deferral term in his IrrevocableElection Agreement which ending date may be: 1. a specified date;  2. the Participant’s Retirement (or if later, the date of theParticipant’s Separation from Service);  3. the attainment of a specified age by the Participant; or  4. any combination of the foregoing. b. The Participant shall specify in the Irrevocable Election Agreement to have anyYear’s deferral, together with interest accrued thereon, paid in a lump sum or in aspecified number of approximately equal annual installments. Payment of the firstinstallment or the lump sum shall be made on or before the January 31st coinciding withor next following the end of the deferral term.  c. In the event of the Participant’s Separation from Service, other than aSeparation from Service upon Retirement, or upon the Participant’s death afterRetirement, and prior to the end of the deferral term or before all installments havebeen paid with respect to any deferral of compensation earned prior to January 1, 2005,the remaining balance as reflected on the Participant’s Account shall be paid asfollows: 1. if, under the Participant’s Irrevocable Election Agreement, thebalance of the Account would have been payable within five (5) years of thedate of the Participant’s Termination or death, then the Account shall bepayable in accordance with the Irrevocable Election Agreement; or  2. if, under the Participant’s Irrevocable Election Agreement, thebalance of the Account would not have been payable within five (5) years of thedate of the Participant’s Termination or death, then the Account shall bepayable in five installments commencing on the January 31st next following theParticipant’s Termination or death and on the four (4) succeeding January 31st.Each installment shall equal the balance then credited to the Account dividedby the remaining number of unpaid installments.Notwithstanding the foregoing, with respect to any deferral of compensation earnedon or after January 1, 2005, the remaining balance as reflected on the Participant’sAccount shall be payable in accordance with the Participant’s Irrevocable ElectionAgreement.
 
6

 
 d. Payments shall be made to the Participant, or in the event of the Participant’sdeath, to the beneficiary according to Section 10 and in no event later than ninety(90) days following the Participant’s Separation from Service or the Participant’s dateof death. If no beneficiary has been designated, payment shall be made to theParticipant’s spouse, if he or she survives the Participant, or, if the Participantdoes not have a surviving spouse, payment shall be made to the Participant’s estate.  e. The Committee shall accelerate the time and manner of making payments from theParticipant’s Account in the event of a Section 409A Change in Control.  f. All payments made to a Participant, beneficiary of a deceased Participant orthe estate of the Participant pursuant to Section 8 shall be debited to theParticipant’s Account as of the date of payment.  g. The Company shall have the right to withhold and pay over any and allwithholding taxes which it may be required to collect under federal, state or local lawwith respect to payments hereunder.  h. In the event the Participant incurs a Separation from Service (other than onaccount of death or Disability) while a Specified Employee such payment shall not beginbefore the date that is six (6) months after the date of such Separation from Service.In the event a Participant who is a Specified Employee has elected to receive benefitsunder this Plan in annual installment payments, such installments that would normallybe paid during the six (6) months following the date that the Participant experiences aSeparation from Service, shall be accumulated and paid to such Participant (or in theevent of such Participant’s death, to his estate), no earlier than the first day of theseventh (7th) month following the date of such Participant’s Separation fromService.9. Additional DistributionIf Bonuses deferred under this Plan are not considered as pay in determining benefits underthe Keithley Instruments, Inc. Employees’ Pension Plan, as such Plan may be amended fromtime to time hereafter, or the pension plan of a Subsidiary, then, if necessary, asupplemental payment of equivalent actuarial value as determined by the Company’s consultingactuaries for the pension plan shall be made by the Company, or, if applicable, aSubsidiary, with each payment (which will be in addition to the amounts payable underParagraph 8) to compensate a Participant for any reduction in benefits suffered under thepension plan due to the deferral of a Bonus under this Plan.Notwithstanding the foregoing, such payment under this Section 9 must conform to therequirements of the Participant’s Irrevocable Election Agreement as provided for underSection 8. In the event payment is scheduled to commence to such Participant an account ofa Separation from Service (other than an account of death or Disability) while suchParticipant is a Specified Employee (as previously defined herein) any payment otherwisepermitted or required by this Section 9 shall not begin before the date that is six (6)months after the payment date contained in the Participant’s Irrevocable Election Agreement. In the event a Participant who is a Specified Employee receives benefits under thisSection, such payment shall be accumulated and paid to such Participant (or in the event ofsuch Participant’s death, to his estate) no earlier than the first day of the seventh(7th) month following the date of the Change in Control.
 
7

 
10. Designation of BeneficiaryEach Participant shall have the right to designate a beneficiary or beneficiaries to receiveany amount credited to his Account remaining unpaid at the Participant’s death. Suchdesignation shall be effected by filing written notification with the Committee and may bechanged from time to time by similar action. If the Participant fails to make suchdesignation, any such unpaid amount credited to his Account shall be paid to theParticipant’s surviving spouse, if any, or, if there is no surviving spouse, to theParticipant’s estate in the manner provided in Paragraph 8(c).11. Non-Alienation of PaymentsAny amount payable from a Participant’s Account shall not be subject in any manner toalienation, sale, transfer, assignment, pledge, attachment, garnishment, or encumbrance ofany kind, by will, or by inter vivos instrument. Any attempt to alienate, sell, transfer,assign, pledge or otherwise encumber any such payment, whether presently or thereafterpayable, shall not be recognized by the Committee or the Company. Payments under the Planshall not in any manner be subject to the debts or liabilities of any Participant exceptthat the Company shall have the right to charge the Participant’s Account for any amountsdue and owing to the Company by the Participant. If a Participant shall attempt to alienate,sell, transfer, assign, pledge or otherwise encumber payments under the Plan or any partthereof, or if by reason of the Participant’s bankruptcy or other event happening at anytime such payments would devolve upon anyone else or would not be enjoyed by theParticipant, then the Committee, in its discretion, may terminate the Participant’s interestin any such benefit, and hold or apply it for the benefit of such Participant, theParticipant’s spouse, children, or any dependents, or any of them, in such manner as theCommittee may deem proper.12. IncompetencyEvery person receiving or claiming payments under this Plan shall be conclusively presumedto be mentally competent until the date on which the Committee receives a written notice, inform and manner acceptable to the Committee, that such person is incompetent and that aguardian, conservator, or other person legally vested with the care of the person’s estatehas been appointed. In the event a guardian or conservator of the estate of any personreceiving or claiming payments under this Plan shall be appointed by a court of competentjurisdiction, payments may be made to such guardian or conservator provided that properproof of appointment and continuing qualification is furnished in form and manner acceptableto the Committee. Any such payment so made shall be a complete discharge of any liabilitytherefor.13. Right to Other BenefitsParticipation in this Plan shall not disqualify a Participant from the right to participatein other benefits of the Company or a Subsidiary to which the Participant may be entitled.However, deferral of amounts under this Plan may affect the extent of participationdepending on the terms of such other plan of the Company or a Subsidiary.
 
8

 
14. No Right to Continued EmploymentIn no event shall participation in this Plan give or be deemed to give a Participant anyright to be retained in the employ of the Company.15. Amendment or Termination of the PlanThe Committee reserves the right to amend, modify or discontinue future deferrals under thePlan at any time; provided, however, no such action shall: a. reduce the then amount credited to any Participant’s account;  b. reduce the rate of interest to be credited until the date of payment to amountsdeferred prior to the date of such action;  c. change the date of payment or the manner of payment of any amounts deferredprior to the date of such action or the interest thereon; or  d. provide for any forfeiture of any amounts deferred prior to the date of suchaction or the interest thereon;without the express written consent of the Participant or the beneficiary of a deceasedParticipant. Notice of amendments to or discontinuance of future accruals under the Planshall be given in writing to each Participant or beneficiary of a deceased Participant.This Plan shall terminate in the event that: a. the Company shall sell substantially all its assets, the purchaser of suchassets shall fail or refuse to assume the obligations of the Company and the Companyshall make liquidating distributions to its shareholders; or  b. the Company shall institute proceedings to be adjudicated bankrupt, or shallconsent to the filing of a bankruptcy proceeding against it, or shall file a petitionor answer or consent seeking reorganization under the Bankruptcy Act or any similarapplicable federal or state law or shall make an assignment of its assets for thebenefit of creditors.In the event of termination of this Plan, the Account balances of each Participant anddeceased Participant shall be payable immediately in a single lump sum payment.16. Change of ControlIn the event a Change of Control of the Company has occurred or is about to occur, theCompany shall notify each Participant and each beneficiary of a deceased Participant, inwriting, that a Change of Control has occurred or is about to occur. In the event of aChange of Control, which also qualifies as a Section 409A Change in Control, the Companyshall make payment of the Participant’s vested deferred account balance in a lump sumpayment within thirty (30) days following such Change in Control.
 
9

 
For purposes of this Section 16, a Change of Control shall be deemed to have occurred if:(i) a tender offer shall be made and consummated for the ownership of 25% or more of theoutstanding voting securities of the Company; (ii) the Company shall be merged orconsolidated with another corporation and as a result of such merger or consolidation lessthan 75% of the outstanding voting securities of the surviving or resulting corporationshall be owned in the aggregate by the former shareholders of the Company as the same shallhave existed immediately prior to such merger or consolidation; (iii) the Company shall sellsubstantially all of its assets to another corporation which is not a wholly-ownedsubsidiary; or (iv) a person within the meaning of Section 13(a)(9) or of Section 13(d)(3)(as in effect on the date hereof) of the Securities Exchange Act of 1934, shall acquire,other than by reason of inheritance, twenty-five percent (25%) or more of the outstandingvoting securities of the Company (whether directly, indirectly, beneficially or of record).For purposes of this Plan, ownership of voting securities shall take into account and shallinclude ownership as determined by applying the provisions of Rule 13d-3(d)(1)(i) as ineffect on the date hereof pursuant to the Securities Exchange Act of 1934.17. Books and RecordsThe books and records to be maintained for the purpose of the Plan shall be maintained bythe Company at its own expense and subject to the supervision and control of the Committee.All expenses of administering the Plan shall be paid by the Company from its own funds.18. Review of Claims or DeterminationsAny Participant or beneficiary who desires to make a claim for a benefit under the Plan ordesires a determination with respect to any provision of the Plan, shall send such claim orrequest in writing to the Compensation Committee, Keithley Instruments, Inc., 28775 AuroraRd., Cleveland, Ohio 44139.Any Participant or beneficiary who claims a benefit under the Plan which is wholly orpartially denied, or requests a determination with respect to any provision of the Plan,shall be advised in writing of the denial or determination of the Committee and its reasontherefor. Upon receipt of a written request which is filed with the Committee within sixty(60) days after the claim is denied or the determination is made, such Participant orbeneficiary will be afforded a full and fair review by the Committee of the claim denied orthe determination made. The result of such review by the Committee shall be delivered inwriting within sixty (60) days after the request for review is received and shall includespecific reasons for the decision.19. Governing LawThe Plan shall be construed, administered and governed in all respects under and by the lawsof the State of Ohio.
 
10

 
20. Code Section 409A ComplianceThis Plan is intended to be operated in compliance with the provisions of Code Section 409A(including any rulings or regulations promulgated thereunder). In the event that anyprovision of this Plan fails to satisfy the provisions of Code Section 409A, such provisionshall be reformed so as to comply with Code Section 409A and to preserve as closely aspossible the intention of the Corporation in maintaining the Plan; provided that, in theevent it is determined not to be feasible to so reform a provision of this Plan as itapplies to a payment or benefit due to a Participant or his or her Beneficiary(ies), suchpayment shall be made without complying with Code Section 409A.IN WITNESS HEREOF, the Company by action of its Board of Directors has caused this Amended andRestated Plan to be executed on this 31st day of December, 2008.      **KEITHLEY INSTRUMENTS, INC.**