EX-10.1






Exhibit 10.1




NASH-FINCH COMPANY




2009 INCENTIVE AWARD PLAN


 


ARTICLE 1.




PURPOSE




The purpose of the Nash-Finch Company 2009 Incentive Award Plan (the “Plan”) is to support
the maximization of long-term value creation for Nash-Finch Company (the “ Company ”) and
its stockholders by enabling the Company and its Subsidiaries to attract and retain persons of
ability to perform services for the Company and its Subsidiaries by providing an incentive to such
individuals through equity participation in the Company and by rewarding such individuals who
contribute to the achievement by the Company of its economic objectives. This Plan is intended to
comply with all applicable law, including the requirements of Section 409A of the Code and
Department of Treasury regulations and other interpretive guidance issued there under, including,
without limitation, any such regulations or other guidance that may be issued after the effective
date of this amendment and restatement of the Plan, and shall be operated and interpreted in
accordance with this intention.



ARTICLE 2.




DEFINITIONS AND CONSTRUCTION




Wherever the following terms are used in the Plan they shall have the meanings specified below,
unless the context clearly indicates otherwise. The singular pronoun shall include the plural where
the context so indicates.



2.1 “Administrator” shall mean the Committee as defined in Article 12. With reference to
the duties of the Committee under the Plan which have been delegated to one or more persons
pursuant to Section 12.5, or as to which the Board has assumed, the term “Administrator” shall
refer to such person(s) unless the Committee or the Board has revoked such delegation or the Board
has terminated the assumption of such duties.



2.2 “Award” shall mean an Option, a Restricted Stock award, a Restricted Stock Unit award,
a Performance Award, a Dividend Equivalents award, a Deferred Stock award, a Stock Payment award or
a Stock Appreciation Right, which may be awarded or granted under the Plan (collectively, “
Awards ”).



2.3 “Award Agreement” shall mean any written notice, agreement, terms and conditions,
contract or other instrument or document evidencing an Award, including through electronic medium,
which shall contain such terms and conditions with respect to an Award as the Administrator shall
determine consistent with the Plan.



2.4 “Award Limit” shall mean with respect to Awards that shall be payable in shares of
Common Stock or in cash, as the case may be, the respective limit set forth in Section 3.3.



2.5 “Board” shall mean the Board of Directors of the Company.



2.6 “Change in Control” shall mean any of the following events or transactions:



(a) Any one person or more than one person acting as a group acquires ownership of stock of the
Company that, together with the stock held by such person or group, constitutes more than
50 percent of the total fair market value or total voting power of the stock of the Company.
However, if any one person or more than one person acting as a group, is considered to own more
than 50 percent of the total fair market value or total voting power of the stock of the Company,
the acquisition of additional stock by the same person or persons is not considered to cause a
Change in Control;



(b) Any one person, or more than one person acting as a group acquires (or has acquired during the
12-month period ending on the date of the most recent acquisition by such person or persons)
ownership of stock of the Company possessing 30 percent or more of the total voting power of the
stock of the Company;



(c) Any one person, or more than one person acting as a group acquires (or has acquired during the
12-month period ending on the date of the most recent acquisition by such person or persons) all or
substantially all of the assets of the Company; or



(d) A majority of the members of the Board is replaced during any 12-month period by directors
whose appointment or election is not endorsed by a majority of the members of the Board prior to
the date of the appointment or election;



provided, that the transaction or event described in subsection (a), (b), (c) or (d) also
constitutes a “change in control event,” as defined in Treasury Regulation § 1.409A-3(i)(5).



2.7 “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.



2.8 “Committee” shall have the meaning set forth in Section 12.1.



2.9 “Common Stock” shall mean the common stock of the Company, par value $1.66 2 / 3 per
share.



2.10 “Company” shall mean Nash-Finch Company, a Delaware corporation.



2.11 “Covered Employee” shall mean any Employee who is, or could be, a “covered employee”
within the meaning of Section 162(m) of the Code.



2.12 “Deferred Stock” shall mean a right to receive Common Stock awarded under Section 9.4.



2.13 “Director” shall mean a member of the Board, as constituted from time to time.



2.14 “Disability” or “Disabled” means that a Holder is, by reason of any medically
determinable physical or mental impairment, which can be expected to result in death or can be
expected to last for a continuous period of not less than twelve (12) months:



(a) unable to engage in any substantial gainful activity, or



(b) receiving income replacement benefits for a period of not less than 3 months under any accident
and health plan covering Employees.



2.15 “Dividend Equivalent” shall mean a right to receive the equivalent value (in cash or
Common Stock) of dividends paid on Common Stock, awarded under Section 9.2.



2.16 “DRO” shall mean a domestic relations order as defined by the Code or Title I of the
Employee Retirement Income Security Act of 1974, as amended from time to time, or the rules there
under.



2.17 “Effective Date” shall mean the date the Plan is approved by the Board, subject to
approval of the Plan by the Company’s stockholders.



2.18 “Eligible Individual” shall mean any person who is an Employee or a Non-Employee
Director, as determined by the Committee.



2.19 “Employee” shall mean any officer or other employee (as determined in accordance with
Section 3401(c) of the Code and the Treasury Regulations there under) of the Company or of any
Subsidiary.



2.20 “Equity Restructuring” shall mean a nonreciprocal transaction between the Company and
its stockholders, such as a stock dividend, stock split, spin-off, rights offering or
recapitalization through a large, nonrecurring cash dividend, that affects the number or kind of
shares of Common Stock (or other securities of the Company) or the share price of Common Stock (or
other securities) and causes a change in the per share value of the Common Stock underlying
outstanding Awards. 



2.21 “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from time to
time.



2.22 “Fair Market Value” shall mean with respect to the Common Stock, as of any given date
(or, if no shares were traded or quoted on such date, as of the next preceding date on which there
was such a trade or quote)



(a) the mean between the reported high and low sale prices of the Common Stock during the regular
trading session if the Common Stock is listed, admitted to unlisted trading privileges or reported
on any foreign or national securities exchange or on the NASDAQ Global Market or an equivalent
foreign market on which sale prices are reported;



(b) if the Common Stock is not so listed, admitted to unlisted trading privileges or reported, the
mean between the reported high and low bid prices as reported by the NASDAQ Capital Market, OTC
Bulletin Board or the National Quotation Bureau, Inc. or other comparable service; or



(c) if the Common Stock is not so listed or reported, such price as the Committee determines in
good faith in the exercise of its reasonable discretion.



2.23 “Full Value Award” means any Award other than an Option, Stock Appreciation Right or
other Award for which the Holder pays the intrinsic value existing as of the date of grant (whether
directly or by forgoing a right to receive a payment from the Company or any Subsidiary).



2.24 “Greater Than 10% Stockholder” shall mean an individual then owning (within the
meaning of Section 424(d) of the Code) more than 10% of the total combined voting power of all
classes of stock of the Company or any subsidiary corporation (as defined in Section 424(f) of the
Code) or parent corporation thereof (as defined in Section 424(e) of the Code).



2.25 “Holder” shall mean a person who has been granted an Award.



2.26 “Incentive Stock Option” shall mean an Option that is intended to qualify as an
incentive stock option and conforms to the applicable provisions of Section 422 of the Code.



2.27 “Non-Employee Director” shall mean a Director of the Company who is not an Employee.



2.28 “Non-Qualified Stock Option” shall mean an Option that is not an Incentive Stock
Option.



2.29 “Option” shall mean a right to purchase shares of Common Stock at a specified exercise
price, granted under Article 6. An Option shall be either a Non-Qualified Stock Option or an
Incentive Stock Option; provided , however , that Options granted to Non-Employee
Directors shall be Non-Qualified Stock Options.



2.30 “Performance Award” shall mean a cash bonus award, stock bonus award, performance
award or incentive award that is paid in cash, Common Stock or a combination of both, awarded under
Section 9.1.



2.31 “Performance-Based Compensation” shall mean any compensation that is intended to
qualify as “performance-based compensation” as described in Section 162(m)(4)(C) of the Code.



2.32 “Performance Criteria” shall mean the criteria (and adjustments) that the Committee
selects for an Award for purposes of establishing the Performance Goal or Performance Goals for a
Performance Period, determined as follows:



(a) The Performance Criteria that shall be used to establish Performance Goals are limited to the
following: (i) net earnings (either before or after one or more of the following: (A) interest,
(B) taxes, (C) depreciation and (D) amortization), (ii) gross or net sales or revenue, (iii) net
income (either before or after taxes), (iv) operating earnings or profit, (v) cash flow (including,
but not limited to, operating cash flow and free cash flow), (vi) return on assets, (vii) return on
capital, (viii) return on stockholders’ equity, (ix) return on sales, (x) gross or net profit or
operating margin, (xi) costs, (xii) cost reduction goals (xxiii) funds from operations,
(xiv) expenses, (xv) working capital, (xvi) earnings per share (basic or diluted), (xvii) price per
share of Common Stock, (xviii) total return to stockholders, (xix) economic value added,
(xx) working capital and productivity improvements, (xxi) regulatory body approval for
commercialization of a product, (xxii) implementation or completion of critical projects,
(xxiii) market share, (xxiv) customer satisfaction, (xxv) employee engagement or employee
relations, (xxvi) employee safety, (xxvii) employee diversity, (xxviii) retail store performance as
determined by independent assessment and (xxix) operational performance as measured by on-time
delivery, fill rate, selector accuracy, cost per case, sales per square foot, sales per labor hour
and other, similar, objective productivity measures, any of which may be measured either in
absolute terms or as compared to any incremental increase or decrease or as compared to results of
a peer group or to market performance indicators or indices and, with respect to (xxiv) and (xxv),
as measured by a Company sponsored survey.



(b) The Committee may select one criterion or multiple criteria for measuring performance, and the
measurement may be based upon Company, Subsidiary or business unit performance, either absolute or
by relative comparison to other companies or any other external measure of the selected criteria.
The Committee may also determine that any of these performance goals shall be calculated by
including or excluding any one or more specific items or categories of items (including
projections) as designated by the Committee.



(c) The Administrator may, in its sole discretion, provide that one or more objectively
determinable adjustments shall be made to one or more of the Performance Goals. Such adjustments
may include one or more of the following: (i) items related to a change in accounting principle;
(ii) items relating to financing activities; (iii) expenses for restructuring or productivity
initiatives; (iv) other non-operating items; (v) items related to acquisitions; (vi) items
attributable to the business operations of any entity acquired by the Company during the
Performance Period; (vii) items related to the disposal of a business or segment of a business;
(viii) items related to discontinued operations that do not qualify as a segment of a business
under United States generally accepted accounting principles (“ GAAP ”); (ix) items
attributable to any stock dividend, stock split, combination or exchange of shares occurring during
the Performance Period; or (x) any other items of significant income or expense which are
determined to be appropriate adjustments; (xi) items relating to unusual or extraordinary corporate
transactions, events or developments, (xii) items related to amortization of acquired intangible
assets; (xiii) items that are outside the scope of the Company’s core, on-going business
activities; or (xiv) items relating to any other unusual or nonrecurring events or changes in
applicable laws, accounting principles or business conditions. For all Awards intended to qualify
as Performance-Based Compensation, such determinations shall be made within the time prescribed by,
and otherwise in compliance with, Section 162(m) of the Code. 



2.33 “Performance Goals” shall mean, for a Performance Period, one or more goals
established in writing by the Administrator for the Performance Period based upon one or more
Performance Criteria. Depending on the Performance Criteria used to establish such Performance
Goals, the Performance Goals may be expressed in terms of overall Company performance or the
performance of a division, business unit, or an individual. The achievement of each Performance
Goal shall be determined in accordance with GAAP to the extent applicable.



2.34 “Performance Period” shall mean one or more periods of time, which may be of varying
and overlapping durations, as the Administrator may select, over which the attainment of one or
more Performance Goals will be measured for the purpose of determining a Holder’s right to, and the
payment of, a Performance Award; provided , however , that in no event shall a
Performance Period be less than one year.



2.35 “Plan” shall mean this Nash-Finch Company 2009 Incentive Award Plan, as it may be
amended or restated from time to time.



2.36 “Prior Plan” shall mean the Nash-Finch Company 2000 Stock Incentive Plan as such plan
may be amended from time to time.



2.37 “Restricted Stock” shall mean Common Stock awarded under Article 8 that is subject to
certain restrictions and may be subject to risk of forfeiture or repurchase.



2.38 “Restricted Stock Units” shall mean the right to receive Common Stock awarded under
Section 9.5.



2.39 “Retirement” shall mean, with respect to a Holder, separation from service with the
Company or any Subsidiary for any reason on or after the earlier of the attainment of (i) age 65 or
(ii) age 55 with 10 years of service with the Company or any Subsidiary.



2.40 “Section 409A” shall mean Section 409A of the Code and Department of Treasury
regulations and other interpretive guidance issued there under, including, without limitation, any
such regulations or other guidance that may be issued after the effective date of the Plan.



2.41 “Securities Act” shall mean the Securities Act of 1933, as amended.



2.42 “Stock Appreciation Right” shall mean a stock appreciation right granted under
Article 10.



2.43 “Stock Payment” shall mean (a) a payment in the form of shares of Common Stock, or
(b) an option or other right to purchase shares of Common Stock, as part of a bonus, deferred
compensation or other arrangement, awarded under Section 9.3.



2.44 “Subsidiary” shall mean any entity (other than the Company), whether domestic or
foreign, in an unbroken chain of entities beginning with the Company if each of the entities other
than the last entity in the unbroken chain beneficially owns, at the time of the determination,
securities or interests representing more than fifty percent (50%) of the total combined voting
power of all classes of securities or interests in one of the other entities in such chain.



2.45 “Substitute Award” shall mean an Award granted under the Plan upon the assumption of,
or in substitution for, outstanding equity awards previously granted by a company or other entity
in connection with a corporate transaction, such as a merger, combination, consolidation or
acquisition of property or stock; provided , however , that in no event shall the
term “Substitute Award” be construed to refer to an award made in connection with the cancellation
and repricing of an Option or Stock Appreciation Right.



2.46 “Termination of Service” shall mean,



(a) As to a Non-Employee Director, the time when a Holder who is a Non-Employee Director ceases to
be a Director for any reason, including, without limitation, a termination by resignation, failure
to be elected, death or Retirement, but excluding terminations where the Holder simultaneously
commences or remains in employment or service with the Company or any Subsidiary.



(b) As to an Employee, the time when the employee-employer relationship between a Holder and the
Company or any Subsidiary is terminated for any reason, including, without limitation, a
termination by resignation, discharge, death, disability or Retirement; but excluding terminations
where the Holder simultaneously commences or remains in employment or service with the Company or
any Subsidiary.



The Administrator, in its sole discretion, shall determine the effect of all matters and questions
relating to Terminations of Service, including, without limitation, the question of whether a
Termination of Service resulted from a discharge for cause and all questions of whether particular
leaves of absence constitute a Termination of Service; provided , however , that,
with respect to Incentive Stock Options, unless the Administrator otherwise provides in the terms
of the Award Agreement or otherwise, a leave of absence, change in status from an employee to an
independent contractor or other change in the employee-employer relationship shall constitute a
Termination of Service only if, and to the extent that, such leave of absence, change in status or
other change interrupts employment for the purposes of Section 422(a)(2) of the Code and the then
applicable regulations and revenue rulings under said Section. For purposes of the Plan, a Holder’s
employee-employer relationship shall be deemed to be terminated in the event that the Subsidiary
employing or contracting with such Holder ceases to remain a Subsidiary following any merger, sale
of stock or other corporate transaction or event (including, without limitation, a spin-off).



ARTICLE 3.




SHARES SUBJECT TO THE PLAN




3.1 Number of Shares.



(a) Subject to Section 13.2 and Section 3.1(b), the aggregate number of shares of Stock which may
be issued or transferred pursuant to Awards under the Plan shall be the sum of: (i) 700,000 shares
and (ii) any shares of Stock which were the subject of Awards under the 2000 Stock Incentive Plan
as of the Effective Date but which subsequently are settled without delivery of Shares to the
Holder (whether through forfeiture or otherwise). Upon approval of this plan, no new awards will be
granted under the 2000 Stock Incentive Plan.



(b) To the extent that an Award terminates, expires, or lapses for any reason, or an Award is
settled in cash without the delivery of shares to the Holder, then any shares of Common Stock
subject to the Award shall again be available for the grant of an Award pursuant to the Plan.
Shares of Common Stock tendered or withheld to satisfy the grant or exercise price or tax
withholding obligation pursuant to any Option shall not be available for the grant of an Award
pursuant to the Plan. Any shares of Common Stock repurchased by the Company under Section 8.4 at
the same price paid by the Holder so that such shares are returned to the Company will again be
available for Awards. To the extent permitted by applicable law or any exchange rule, shares of
Common Stock issued in assumption of, or in substitution for, any outstanding awards of any entity
acquired in any form of combination by the Company or any Subsidiary shall not be counted against
shares of Common Stock available for grant pursuant to the Plan. The payment of Dividend
Equivalents in cash in conjunction with any outstanding Awards shall not be counted against the
shares available for issuance under the Plan. Notwithstanding the provisions of this
Section 3.1(b), no shares of Common Stock may again be optioned, granted or awarded if such action
would cause an Incentive Stock Option to fail to qualify as an incentive stock option under
Section 422 of the Code.



3.2 Stock Distributed.  Any Common Stock distributed pursuant to an Award may consist, in
whole or in part, of authorized and unissued Common Stock, treasury Common Stock or Common Stock
purchased on the open market.



3.3 Limitation on Number of Shares Subject to Awards.  Notwithstanding any provision in the
Plan to the contrary, and subject to Section 13.2, the maximum aggregate number of shares of Common
Stock with respect to one or more Awards that may be granted to any one person during any calendar
year shall be 150,000, provided , however , that an Eligible Individual who is
first appointed or elected as an officer or hired as an employee by the Company or who receives a
promotion that results in an increase in responsibilities or duties may be granted, during the
fiscal year of such appointment, election, hiring or promotion, Options relating to up to
250,000 shares of Common Stock.



ARTICLE 4.




GRANTING OF AWARDS




4.1 Participation.  The Administrator may, from time to time, select from among all
Eligible Individuals, those to whom an Award shall be granted and shall determine the nature and
amount of each Award, which shall not be inconsistent with the requirements of the Plan. No
Eligible Individual shall have any right to be granted an Award pursuant to the Plan.



4.2 Award Agreement.  Each Award shall be evidenced by an Award Agreement. Award Agreements
evidencing Awards intended to qualify as Performance-Based Compensation shall contain such terms
and conditions as may be necessary to meet the applicable provisions of Section 162(m) of the Code.
Award Agreements evidencing Incentive Stock Options shall contain such terms and conditions as may
be necessary to meet the applicable provisions of Section 422 of the Code.



4.3 Limitations Applicable to Section 16 Persons.  Notwithstanding any other provision of
the Plan, the Plan, and any Award granted or awarded to any individual who is then subject to
Section 16 of the Exchange Act, shall be subject to any additional limitations set forth in any
applicable exemptive rule under Section 16 of the Exchange Act (including Rule 16b-3 of the
Exchange Act and any amendments thereto) that are requirements for the application of such
exemptive rule. To the extent permitted by applicable law, the Plan and Awards granted or awarded
hereunder shall be deemed amended to the extent necessary to conform to such applicable exemptive
rule.



4.4 At-Will Employment.  Nothing in the Plan or in any Award Agreement hereunder shall
confer upon any Holder any right to continue in the employ of, or as a Director for, the Company or
any Subsidiary, or shall interfere with or restrict in any way the rights of the Company and any
Subsidiary, which rights are hereby expressly reserved, to discharge any Holder at any time for any
reason whatsoever, with or without cause, except to the extent expressly provided otherwise in a
written agreement between the Holder and the Company or any Subsidiary.



4.5 Foreign Holders.  Notwithstanding any provision of the Plan to the contrary, in order
to comply with the laws in other countries in which the Company and its Subsidiaries operate or
have Employees or Non-Employee Directors, or in order to comply with the requirements of any
foreign stock exchange, the Administrator, in its sole discretion, shall have the power and
authority to: (a) determine which Subsidiaries shall be covered by the Plan; (b) determine which
Eligible Individuals outside the United States are eligible to participate in the Plan; (c) modify
the terms and conditions of any Award granted to Eligible Individuals outside the United States to
comply with applicable foreign laws or listing requirements of any such foreign stock exchange;
(d) establish subplans and modify exercise procedures and other terms and procedures, to the extent
such actions may be necessary or advisable (any such subplans and/or modifications shall be
attached to the Plan as appendices); provided , however , that no such subplans
and/or modifications shall increase the share limitations contained in Sections 3.1 and 3.3; and
(e) take any action, before or after an Award is made, that it deems advisable to obtain approval
or comply with any necessary local governmental regulatory exemptions or approvals or listing
requirements of any such foreign stock exchange. Notwithstanding the foregoing, the Administrator
may not take any actions hereunder, and no Awards shall be granted, that would violate the Code,
the Exchange Act, the Securities Act or any other securities law or governing statute or any other
applicable law.



4.6 Stand-Alone and Tandem Awards.  Awards granted pursuant to the Plan may, in the sole
discretion of the Administrator, be granted either alone, in addition to, or in tandem with, any
other Award granted pursuant to the Plan. Awards granted in addition to or in tandem with other
Awards may be granted either at the same time as or at a different time from the grant of such
other Awards.



ARTICLE 5.




PROVISIONS APPLICABLE TO AWARDS INTENDED TO QUALIFY AS PERFORMANCE-BASED COMPENSATION.




5.1 Purpose.  The Committee, in its sole discretion, may determine whether an Award is to
qualify as Performance-Based Compensation. If the Committee, in its sole discretion, decides to
grant such an Award to an Eligible Individual that is intended to qualify as Performance-Based
Compensation, then the provisions of this Article 5 shall control over any contrary provision
contained in the Plan. The Administrator may in its sole discretion grant Awards to other Eligible
Individuals that are based on Performance Criteria or Performance Goals but that do not satisfy the
requirements of this Article 5 and that are not intended to qualify as Performance-Based
Compensation. Unless otherwise specified by the Administrator at the time of grant, the Performance
Criteria with respect to an Award intended to be Performance-Based Compensation payable to a
Covered Employee shall be determined on the basis of GAAP.



5.2 Applicability.  The grant of an Award to an Eligible Individual for a particular
Performance Period shall not require the grant of an Award to such Individual in any subsequent
Performance Period and the grant of an Award to any one Eligible Individual shall not require the
grant of an Award to any other Eligible Individual in such period or in any other period.



5.3 Types of Awards.  Notwithstanding anything in the Plan to the contrary, the Committee
may grant any Award to an Eligible Individual intended to qualify as Performance-Based
Compensation, including, without limitation, Restricted Stock the restrictions with respect to
which lapse upon the attainment of specified Performance Goals, and any performance or incentive
Awards described in Article 9 that vest or become exercisable or payable upon the attainment of one
or more specified Performance Goals. Any such Award will comply with the requirements of
Section 162(m) giving due regard to the disparate treatment under Section 162(m) of Options and
Stock Appreciation Rights (where compensation is determined based solely on an increase in the
value of the underlying stock after the date of grant or award), as compared to other forms of
compensation, including Restricted Stock awards, Performance Units and Stock Payments.



5.4 Procedures with Respect to Performance-Based Awards.  To the extent necessary to comply
with the requirements of Section 162(m)(4)(C) of the Code, with respect to any Award granted under
Articles 7 or 8 to one or more Eligible Individuals and which is intended to qualify as
Performance-Based Compensation, no later than 90 days following the commencement of any Performance
Period or any designated fiscal period or period of service (or such earlier time as may be
required under Section 162(m) of the Code), the Committee shall, in writing, (a) designate one or
more Holders, (b) select the Performance Criteria applicable to the Performance Period,
(c) establish the Performance Goals, and amounts of such Awards, as applicable, which may be earned
for such Performance Period based on the Performance Criteria, and (d) specify the relationship
between Performance Criteria and the Performance Goals and the amounts of such Awards, as
applicable, to be earned by each Covered Employee for such Performance Period. Following the
completion of each Performance Period, the Committee shall certify in writing whether and the
extent to which the applicable Performance Goals have been achieved for such Performance Period. In
determining the amount earned under such Awards, the Committee shall not have the right to increase
the amount payable at a given level of performance to take into account additional factors that the
Committee may deem relevant to the assessment of individual or corporate performance for the
Performance Period.



5.5 Payment of Performance-Based Awards.  Unless otherwise provided in the applicable Award
Agreement and only to the extent otherwise permitted by Section 162(m)(4)(C) of the Code, as to an
Award that is intended to qualify as Performance-Based Compensation, the Holder must be employed by
the Company or a Subsidiary throughout the Performance Period. Furthermore, a Holder shall be
eligible to receive payment pursuant to such Awards for a Performance Period only if and to the
extent the Performance Goals for such period are achieved.



5.6 Additional Limitations.  Notwithstanding any other provision of the Plan, any Award
which is granted to an Eligible Individual and is intended to qualify as Performance-Based
Compensation shall be subject to any additional limitations set forth in Section 162(m) of the Code
or any regulations or rulings issued there under that are requirements for qualification as
Performance-Based Compensation, and the Plan and the Award Agreement shall be deemed amended to the
extent necessary to conform to such requirements.



ARTICLE 6.




GRANTING OF OPTIONS




6.1 Granting of Options to Eligible Individuals.  The Administrator is authorized to grant
Options to Eligible Individuals from time to time, in its sole discretion, on such terms and
conditions as it may determine which shall not be inconsistent with the Plan.



6.2 Qualification of Incentive Stock Options.  No Incentive Stock Option shall be granted
to any person who is not an Employee of the Company or any subsidiary corporation of the Company
(as defined in Section 424(f) of the Code). No person who qualifies as a Greater Than 10%
Stockholder may be granted an Incentive Stock Option unless such Incentive Stock Option conforms to
the applicable provisions of Section 422 of the Code. Any Incentive Stock Option granted under the
Plan may be modified by the Administrator, with the consent of the Holder, to disqualify such
Option from treatment as an “incentive stock option” under Section 422 of the Code. To the extent
that any Incentive Stock Option granted under the Plan ceases for any reason to qualify as an
“incentive stock option” for purposes of Section 422 of the Code, such Incentive Stock Option will
continue to be outstanding for purposes of the Plan but will thereafter be deemed to be a
Non-Statutory Stock Option. To the extent that the aggregate fair market value of stock with
respect to which “incentive stock options” (within the meaning of Section 422 of the Code, but
without regard to Section 422(d) of the Code) are exercisable for the first time by a Holder during
any calendar year under the Plan, and all other plans of the Company and any Subsidiary or parent
corporation thereof (as defined in Section 424(e) of the Code), exceeds $100,000, the Options shall
be treated as Non-Qualified Stock Options to the extent required by Section 422 of the Code. The
rule set forth in the preceding sentence shall be applied by taking Options and other “incentive
stock options” into account in the order in which they were granted and the fair market value of
stock shall be determined as of the time the respective options were granted. If such excess only
applies to a portion of an Incentive Stock Option, the Committee, in its discretion, will designate
which shares will be treated as shares to be acquired upon exercise of an Incentive Stock Option.



6.3 Option Exercise Price.  The exercise price per share of Common Stock subject to each
Option shall be set by the Administrator, but shall not be less than 100% of the Fair Market Value
of a share of Common Stock on the date the Option is granted (or, as to Incentive Stock Options, on
the date the Option is modified, extended or renewed for purposes of Section 424(h) of the Code).
In addition, in the case of Incentive Stock Options granted to a Greater Than 10% Stockholder, such
price shall not be less than 110% of the Fair Market Value of a share of Common Stock on the date
the Option is granted (or the date the Option is modified, extended or renewed for purposes of
Section 424(h) of the Code).



6.4 Option Term.  The term of each Option shall be set by the Administrator in its sole
discretion; provided , however , that no portion of an Option may be exercisable
prior to six months from its date of grant (other than in connection with a Holder’s death or
Disability) and no Option may be exercised more than ten (10) years from the date the Option is
granted, or five (5) years from the date an Incentive Stock Option is granted to a Greater Than 10%
Stockholder; provided , further , that each Option shall become vested over a
period of not less than three years (or, in the case of vesting based upon the attainment of
Performance Goals or other performance-based objectives, over a period of not less than one year
measured from the commencement of the period over which performance is evaluated). The
Administrator shall determine the time period, including the time period following a Termination of
Service, during which the Holder has the right to exercise the vested Options, which time period
may not extend beyond the term of the Option term. Except as limited by the requirements of
Section 409A or Section 422 of the Code and regulations and rulings there under, the Administrator
may extend the term of any outstanding Option, and may extend the time period during which vested
Options may be exercised, in connection with any Termination of Service of the Holder, and may
amend any other term or condition of such Option relating to such a Termination of Service.



6.5 Option Vesting.



(a) The period during which the right to exercise, in whole or in part, an Option vests in the
Holder shall be set by the Administrator and the Administrator may determine that an Option may not
be exercised in whole or in part for a specified period after it is granted. Such vesting may be
based on service with the Company or any Subsidiary, any of the Performance Criteria, or any other
criteria selected by the Administrator. At any time after grant of an Option, the Administrator
may, in its sole discretion and subject to whatever terms and conditions it selects, accelerate the
period during which an Option vests.



(b) No portion of an Option which is unexercisable at a Holder’s Termination of Service shall
thereafter become exercisable, except as may be otherwise provided by the Administrator either in
the Award Agreement or by action of the Administrator following the grant of the Option.



6.6 Substitute Awards.  Notwithstanding the foregoing provisions of this Article 6 to the
contrary, in the case of an Option that is a Substitute Award, the price per share of the shares
subject to such Option may be less than the Fair Market Value per share on the date of grant,
provided , that Substitute Award meets the requirements of Treasury
Regulation Section 1.409A-1(b)(5)(v)(D).



6.7 Substitution of Stock Appreciation Rights.  The Administrator may provide in the Award
Agreement evidencing the grant of an Option that the Administrator, in its sole discretion, shall
have the right to substitute a Stock Appreciation Right for such Option at any time prior to or
upon exercise of such Option; provided , that such Stock Appreciation Right shall be
exercisable with respect to the same number of shares of Common Stock for which such substituted
Option would have been exercisable.



ARTICLE 7.




EXERCISE OF OPTIONS




7.1 Partial Exercise.  An exercisable Option may be exercised in whole or in part. However,
an Option shall not be exercisable with respect to fractional shares and the Administrator may
require that, by the terms of the Option, a partial exercise must be with respect to a minimum
number of shares.



7.2 Manner of Exercise.  All or a portion of an exercisable Option shall be deemed
exercised upon delivery of all of the following to the Secretary of the Company, or such other
person or entity designated by the Administrator, or his, her or its office, as applicable:



(a) A written notice complying with the applicable rules established by the Administrator stating
that the Option, or a portion thereof, is exercised. The notice shall be signed by the Holder or
other person then entitled to exercise the Option or such portion of the Option;



(b) Such representations and documents as the Administrator, in its sole discretion, deems
necessary or advisable to effect compliance with all applicable provisions of the Securities Act
and any other federal, state or foreign securities laws or regulations. The Administrator may, in
its sole discretion, also take whatever additional actions it deems appropriate to effect such
compliance including, without limitation, placing legends on share certificates and issuing
stop-transfer notices to agents and registrars;



(c) In the event that the Option shall be exercised pursuant to Section 11.3 by any person or
persons other than the Holder, appropriate proof of the right of such person or persons to exercise
the Option; and



(d) Full payment of the exercise price and applicable withholding taxes to the Secretary of the
Company for the shares with respect to which the Option, or portion thereof, is exercised, in a
manner permitted by Section 11.1 and 11.2.



7.3 Notification Regarding Disposition.  The Holder shall give the Company prompt notice of
any disposition of shares of Common Stock acquired by exercise of an Incentive Stock Option which
occurs within (a) two years from the date of granting (including the date the Option is modified,
extended or renewed for purposes of Section 424(h) of the Code) such Option to such Holder, or
(b) one year after the transfer of such shares to such Holder.



ARTICLE 8.




AWARD OF RESTRICTED STOCK




8.1 Award of Restricted Stock.



The Administrator is authorized to grant Restricted Stock to Eligible Individuals, and shall
determine the terms and conditions, including the restrictions applicable to each award of
Restricted Stock, which terms and conditions shall not be inconsistent with the Plan, and may
impose such conditions on the issuance of such Restricted Stock as it deems appropriate;
provided , however , that no portion of a Restricted Stock award may vest prior to six
months from its date of grant (other than in connection with a Holder’s death or Disability);
provided , further , that each Restricted Stock award shall become vested over a
period of not less than three years (or, in the case of vesting based upon the attainment of
Performance Goals or other performance-based objectives, over a period of not less than one year
measured from the commencement of the period over which performance is evaluated).



(a) The Administrator shall establish the purchase price, if any, and form of payment for
Restricted Stock; provided , however , that such purchase price shall be no less
than the par value of the Common Stock to be purchased, unless otherwise permitted by applicable
state law. In all cases, legal consideration shall be required for each issuance of Restricted
Stock.



8.2 Rights as Stockholders.  Except as provided in Sections 8.1, 8.3 and 11.3 and subject
to Section 8.4, upon issuance of Restricted Stock, the Holder shall have, unless otherwise provided
by the Administrator, all the rights of a stockholder with respect to said shares, subject to the
restrictions in his or her Award Agreement, including the right to receive all dividends and other
distributions paid or made with respect to the shares; provided , however , that,
in the sole discretion of the Administrator, any extraordinary distributions with respect to the
Common Stock shall be subject to the restrictions set forth in Section 8.3.



8.3 Restrictions.  All shares of Restricted Stock (including any shares received by Holders
thereof with respect to shares of Restricted Stock as a result of stock dividends, stock splits or
any other form of recapitalization) and dividends or cash distributions paid with respect to shares
of unvested Restricted Stock shall, in the terms of each individual Award Agreement, be subject to
such restrictions and vesting requirements as the Administrator shall provide. Such restrictions
may include, without limitation, restrictions concerning voting rights and transferability and such
restrictions may lapse separately or in combination at such times and pursuant to such
circumstances or based on such criteria as selected by the Administrator, including, without
limitation, criteria based on the Holder’s duration of employment or directorship with the Company,
the Performance Criteria, Company performance, individual performance or other criteria selected by
the Administrator. In the event the Committee determines not to pay dividends or distributions
currently, the Committee will determine in its sole discretion whether any interest will be paid on
such dividends or distributions. In addition, the Committee in its sole discretion may require such
dividends and distributions to be reinvested (and in such case the Holder consents to such
reinvestment) in shares of Common Stock that will be subject to the same restrictions as the shares
to which such dividends or distributions relate. By action taken after the Restricted Stock is
issued, the Administrator may, on such terms and conditions as it may determine to be appropriate,
accelerate the vesting of such Restricted Stock by removing any or all of the restrictions imposed
by the terms of the Award Agreement. Restricted Stock may not be sold or encumbered until all
restrictions are terminated or expire.



8.4 Repurchase or Forfeiture of Restricted Stock.  If no price was paid by the Holder for
the Restricted Stock, upon a Termination of Service the Holder’s rights in unvested Restricted
Stock then subject to restrictions shall lapse, and such Restricted Stock shall be surrendered to
the Company and cancelled without consideration. If a price was paid by the Holder for the
Restricted Stock, upon a Termination of Service the Company shall have the right to repurchase from
the Holder the unvested Restricted Stock then subject to restrictions at a cash price per share
equal to the price paid by the Holder for such Restricted Stock or such other amount as may be
specified in the Award Agreement The Administrator in its sole discretion may provide that in the
event of certain events, including a Change in Control, the Holder’s death, Retirement or
disability or any other specified Termination of Service or any other event, the Holder’s rights in
unvested Restricted Stock shall not lapse, such Restricted Stock shall vest and, if applicable, the
Company shall not have a right of repurchase.



8.5 Certificates for Restricted Stock.  Restricted Stock granted pursuant to the Plan may
be evidenced in such manner as the Administrator shall determine. Certificates or book entries
evidencing shares of Restricted Stock must include an appropriate legend referring to the terms,
conditions, and restrictions applicable to such Restricted Stock, and the Company may, in it sole
discretion, retain physical possession of any stock certificate until such time as all applicable
restrictions lapse.



8.6 Section 83(b) Election.  If a Holder makes an election under Section 83(b) of the Code
to be taxed with respect to the Restricted Stock as of the date of transfer of the Restricted Stock
rather than as of the date or dates upon which the Holder would otherwise be taxable under
Section 83(a) of the Code, the Holder shall be required to deliver a copy of such election to the
Company promptly after filing such election with the Internal Revenue Service.



ARTICLE 9.




AWARD OF PERFORMANCE AWARDS, DIVIDEND EQUIVALENTS, DEFERRED STOCK, STOCK PAYMENTS, RESTRICTED STOCK

UNITS




9.1 Performance Awards.



(a) The Administrator is authorized to grant Performance Awards to any Eligible Individual and to
determine whether such Performance Awards shall be Performance-Based Compensation. The value of
Performance Awards may be linked to any one or more of the Performance Criteria or other specific
criteria determined by the Administrator, in each case on a specified date or dates or over any
period or periods determined by the Administrator. In making such determinations, the Administrator
shall consider (among such other factors as it deems relevant in light of the specific type of
Award) the contributions, responsibilities and other compensation of the particular Eligible
Individual. Performance Awards may be paid in cash, shares of Common Stock, or both, as determined
by the Administrator.



(b) Without limiting Section 9.1(a), the Administrator may grant Performance Awards to any Eligible
Individual in the form of a cash bonus payable upon the attainment of objective Performance Goals,
or such other criteria, whether or not objective, which are established by the Administrator, in
each case on a specified date or dates or over any period or periods determined by the
Administrator. Any such bonuses paid to a Holder which are intended to be Performance-Based
Compensation shall be based upon objectively determinable bonus formulas established in accordance
with the provisions of Article 5. Additionally, any such bonuses paid to any Eligible Individual
shall be subject to the Award Limit.



9.2 Dividend Equivalents.



(a) Dividend Equivalents may be granted by the Administrator based on dividends declared on the
Common Stock, to be credited as of dividend payment dates during the period between the date an
Award is granted to a Holder and the date such Award vests, is exercised, is distributed or
expires, as determined by the Administrator. Such Dividend Equivalents shall be converted to cash
or additional shares of Common Stock by such formula and at such time and subject to such
limitations as may be determined by the Administrator.



(b) Notwithstanding the foregoing, (i) no Dividend Equivalents shall be payable with respect to
Options or Stock Appreciation Rights that are either forfeited or cancelled prior to vesting, and
(ii) no Dividend Equivalents shall be earned with respect to Awards that vest based upon the
attainment of Performance Goals or other performance-based objectives prior to the attainment of
such Performance Goals or objectives.



9.3 Stock Payments.  The Administrator is authorized to make Stock Payments to any Eligible
Individual. The number or value of shares of any Stock Payment shall be determined by the
Administrator and may be based upon one or more Performance Criteria or any other specific
criteria, including service to the Company or any Subsidiary, determined by the Administrator.
Stock Payments may, but are not required to be made in lieu of base salary, bonus, fees or other
cash compensation otherwise payable to such Eligible Individual.



9.4 Deferred Stock.  The Administrator is authorized to grant Deferred Stock to any
Eligible Individual. The number of shares of Deferred Stock shall be determined by the
Administrator and may be based on one or more Performance Criteria or other specific criteria,
including service to the Company or any Subsidiary, as the Administrator determines, in each case
on a specified date or dates or over any period or periods determined by the Administrator. Common
Stock underlying a Deferred Stock award will not be issued until the Deferred Stock award has
vested, pursuant to a vesting schedule or other conditions or criteria set by the Administrator.
Unless otherwise provided by the Administrator, a Holder of Deferred Stock shall have no rights as
a Company stockholder with respect to such Deferred Stock until such time as the Award has vested
and the Common Stock underlying the Award has been issued to the Holder.



9.5 Restricted Stock Units.  The Administrator is authorized to grant Restricted Stock
Units to any Eligible Individual. The number and terms and conditions of Restricted Stock Units
shall be determined by the Administrator. The Administrator shall specify the date or dates on
which the Restricted Stock Units shall become fully vested and nonforfeitable, and may specify such
conditions to vesting as it deems appropriate, including conditions based on one or more
Performance Criteria or other specific criteria, including service to the Company or any
Subsidiary, in each case on a specified date or dates or over any period or periods, as the
Administrator determines,. The Administrator shall specify, or permit the Holder to elect, the
conditions and dates upon which the shares of Common Stock underlying the Restricted Stock Units
which shall be issued, which dates shall not be earlier than the date as of which the Restricted
Stock Units vest and become nonforfeitable and which conditions and dates shall be subject to
compliance with Section 409A of the Code. On the distribution dates, the Company shall issue to the
Holder one unrestricted, fully transferable share of Common Stock for each vested and
nonforfeitable Restricted Stock Unit.



9.6 Term.  The term of a Performance Award, Dividend Equivalent award, Deferred Stock
award, Stock Payment award and/or Restricted Stock Unit award shall be set by the Administrator in
its sole discretion.



9.7 Exercise or Purchase Price.  The Administrator may establish the exercise or purchase
price of a Performance Award, shares of Deferred Stock, shares distributed as a Stock Payment award
or shares distributed pursuant to a Restricted Stock Unit award; provided ,
however , that value of the consideration shall not be less than the par value of a share of
Common Stock, unless otherwise permitted by applicable law.



ARTICLE 10.




AWARD OF STOCK APPRECIATION RIGHTS




10.1 Grant of Stock Appreciation Rights.



(a) The Administrator is authorized to grant Stock Appreciation Rights to Eligible Individuals from
time to time, in its sole discretion, on such terms and conditions as it may determine consistent
with the Plan.



(b) A Stock Appreciation Right shall entitle the Holder (or other person entitled to exercise the
Stock Appreciation Right pursuant to the Plan) to exercise all or a specified portion of the Stock
Appreciation Right (to the extent then exercisable pursuant to its terms) and to receive from the
Company an amount determined by multiplying the difference obtained by subtracting the exercise
price per share of the Stock Appreciation Right from the Share Value on the date of exercise of the
Stock Appreciation Right by the number of shares of Common Stock with respect to which the Stock
Appreciation Right shall have been exercised, subject to any limitations the Administrator may
impose. Except as described in (c) below, the exercise price per share of Common Stock subject to
each Stock Appreciation Right shall be set by the Administrator, but shall not be less than 100% of
the Share Value on the date the Stock Appreciation Right is granted.



(c) Notwithstanding the foregoing provisions of Section 10.1(b) to the contrary, in the case of an
Stock Appreciation Right that is a Substitute Award, the price per share of the shares subject to
such Stock Appreciation Right may be less than the Fair Market Value per share on the date of
grant, provided , that that Substitute Award meets the requirements of Treasury
Regulation Section 1.409A-1(b)(5)(v)(D).



10.2 Stock Appreciation Right Vesting.



(a) The period during which the right to exercise, in whole or in part, a Stock Appreciation Right
vests in the Holder shall be set by the Administrator and the Administrator may determine that a
Stock Appreciation Right may not be exercised in whole or in part for a specified period after it
is granted; provided , however , that no portion of a Stock Appreciation Right may
be exercisable prior to six months from its date of grant (other than in connection with a Holder’s
death or Disability) or after 10 years from its date of grant; provided , further
        , that each Stock Appreciation Right shall become vested over a period of not less than three years
(or, in the case of vesting based upon the attainment of Performance Goals or other
performance-based objectives, over a period of not less than one year measured from the
commencement of the period over which performance is evaluated). Such vesting may be based on
service with the Company or any Subsidiary, or any other criteria selected by the Administrator. At
any time after grant of a Stock Appreciation Right, the Administrator may, in its sole discretion
and subject to whatever terms and conditions it selects, accelerate the period during which a Stock
Appreciation Right vests.



(b) No portion of a Stock Appreciation Right which is unexercisable at Termination of Service shall
thereafter become exercisable, except as may be otherwise provided by the Administrator either in
the Award Agreement or by action of the Administrator following the grant of the Stock Appreciation
Right.



10.3 Manner of Exercise.  All or a portion of an exercisable Stock Appreciation Right shall
be deemed exercised upon delivery of all of the following to the Secretary of the Company, or such
other person or entity designated by the Administrator, or his, her or its office, as applicable:



(a) A written notice complying with the applicable rules established by the Administrator stating
that the Stock Appreciation Right, or a portion thereof, is exercised. The notice shall be signed
by the Holder or other person then entitled to exercise the Stock Appreciation Right or such
portion of the Stock Appreciation Right;



(b) Such representations and documents as the Administrator, in its sole discretion, deems
necessary or advisable to effect compliance with all applicable provisions of the Securities Act
and any other federal, state or foreign securities laws or regulations. The Administrator may, in
its sole discretion, also take whatever additional actions it deems appropriate to effect such
compliance; and



(c) In the event that the Stock Appreciation Right shall be exercised pursuant to this Section 10.3
by any person or persons other than the Holder, appropriate proof of the right of such person or
persons to exercise the Stock Appreciation Right.



10.4 Payment.  Payment of the amounts determined under Section 10.2(c) and 10.3(b) above
shall be in cash, shares of Common Stock (based on its Fair Market Value as of the date the Stock
Appreciation Right is exercised), or a combination of both, as determined by the Administrator.



ARTICLE 11.




ADDITIONAL TERMS OF AWARDS




11.1 Payment.  The Administrator shall determine the methods by which payments by any
Holder with respect to any Awards granted under the Plan shall be made, including, without
limitation: (a) cash or check, (b) shares of Common Stock (including, in the case of payment of the
exercise price of an Award, shares of Common Stock issuable pursuant to the exercise of the Award)
or shares of Common Stock held for such period of time as may be required by the Administrator in
order to avoid adverse accounting consequences, in each case, having a Fair Market Value on the
date of delivery equal to the aggregate payments required, (c) delivery of a notice that the Holder
has placed a market sell order with a broker with respect to shares of Common Stock then issuable
upon exercise or vesting of an Award, and that the broker has been directed to pay a sufficient
portion of the net proceeds of the sale to the Company in satisfaction of the aggregate payments
required, provided , that payment of such proceeds is then made to the Company upon
settlement of such sale, (d) a promissory note (on terms acceptable to the Committee in its sole
discretion) or (e) other form of legal consideration acceptable to the Administrator. The
Administrator shall also determine the methods by which shares of Common Stock shall be delivered
or deemed to be delivered to Holders. Notwithstanding any other provision of the Plan to the
contrary, no Holder who is a Director or an “executive officer” of the Company within the meaning
of Section 13(k) of the Exchange Act shall be permitted to make payment with respect to any Awards
granted under the Plan, or continue any extension of credit with respect to such payment with a
loan from the Company or a loan arranged by the Company in violation of Section 13(k) of the
Exchange Act.



11.2 Tax Withholding.  The Company or any Subsidiary shall have the authority and the right
to deduct or withhold, or require a Holder to remit to the Company, an amount sufficient to satisfy
federal, state, local and foreign taxes (including the Holder’s FICA or employment tax obligation)
required by law to be withheld with respect to any taxable event concerning a Holder arising as a
result of the Plan. The Administrator may in its sole discretion and in satisfaction of the
foregoing requirement allow a Holder to elect to have the Company withhold shares of Common Stock
otherwise issuable under an Award (or allow the surrender of shares of Common Stock). The number of
shares of Common Stock which may be so withheld or surrendered shall be limited to the number of
shares which have a Fair Market Value on the date of withholding or repurchase equal to the
aggregate amount of such liabilities based on the minimum statutory withholding rates for federal,
state, local and foreign income tax and payroll tax purposes that are applicable to such
supplemental taxable income. The Administrator shall determine the fair market value of the Common
Stock, consistent with applicable provisions of the Code, for tax withholding obligations due in
connection with a broker-assisted cashless Option or Stock Appreciation Right exercise involving
the sale of shares to pay the Option or Stock Appreciation Right exercise price or any tax
withholding obligation.



11.3 Transferability of Awards.



(a) Except as otherwise provided in Section 11.3(b):



(i) No Award under the Plan may be sold, pledged, assigned or transferred in any manner other than
by will or the laws of descent and distribution or, subject to the consent of the Administrator,
pursuant to a DRO, unless and until such Award has been exercised, or the shares underlying such
Award have been issued, and all restrictions applicable to such shares have lapsed;



(ii) No Award or interest or right therein shall be liable for the debts, contracts or engagements
of the Holder or his successors in interest or shall be subject to disposition by transfer,
alienation, anticipation, pledge, hypothecation, encumbrance, assignment or any other means whether
such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment,
garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted
disposition thereof shall be null and void and of no effect, except to the extent that such
disposition is permitted by the preceding sentence; and



(iii) During the lifetime of the Holder, only the Holder may exercise an Award (or any portion
thereof) granted to him under the Plan, unless it has been disposed of pursuant to a DRO; after the
death of the Holder, any exercisable portion of an Award may, prior to the time when such portion
becomes unexercisable under the Plan or the applicable Award Agreement, be exercised by his
personal representative or by any person empowered to do so under the deceased Holder’s will or
under the then applicable laws of descent and distribution.



(b) Notwithstanding Section 11.3(a), the Administrator, in its sole discretion, may determine to
permit a Holder to transfer an Award other than an Incentive Stock Option to any one or more
Permitted Transferees (as defined below), subject to the following terms and conditions: (i) an
Award transferred to a Permitted Transferee shall not be assignable or transferable by the
Permitted Transferee other than by will or the laws of descent and distribution; (ii) an Award
transferred to a Permitted Transferee shall continue to be subject to all the terms and conditions
of the Award as applicable to the original Holder (other than the ability to further transfer the
Award); and (iii) the Holder and the Permitted Transferee shall execute any and all documents
requested by the Administrator, including, without limitation documents to (A) confirm the status
of the transferee as a Permitted Transferee, (B) satisfy any requirements for an exemption for the
transfer under applicable federal, state and foreign securities laws and (C) evidence the transfer.
For purposes of this Section 11.3(b), “ Permitted Transferee ” shall mean, with respect to
a Holder, any “family member” of the Holder, as defined under the instructions to use of the
Form S-8 Registration Statement under the Securities Act, or any other transferee specifically
approved by the Administrator after taking into account any state, federal, local or foreign tax
and securities laws applicable to transferable Awards.



(c) Notwithstanding Section 11.3(a), a Holder may, in the manner determined by the Administrator,
designate a beneficiary to exercise the rights of the Holder and to receive any distribution with
respect to any Award upon the Holder’s death. A beneficiary, legal guardian, legal representative,
or other person claiming any rights pursuant to the Plan is subject to all terms and conditions of
the Plan and any Award Agreement applicable to the Holder, except to the extent the Plan and Award
Agreement otherwise provide, and to any additional restrictions deemed necessary or appropriate by
the Administrator. If the Holder is married and resides in a community property state, a
designation of a person other than the Holder’s spouse as his or her beneficiary with respect to
more than 50% of the Holder’s interest in the Award shall not be effective without the prior
written consent of the Holder’s spouse. If no beneficiary has been designated or survives the
Holder, payment shall be made to the person entitled thereto pursuant to the Holder’s will or the
laws of descent and distribution. Subject to the foregoing, a beneficiary designation may be
changed or revoked by a Holder at any time provided the change or revocation is filed
with the Administrator prior to the Holder’s death.



11.4 Conditions to Issuance of Shares.



(a) Notwithstanding anything herein to the contrary, the Company shall not be required to issue or
deliver any certificates or make any book entries evidencing shares of Common Stock pursuant to the
exercise of any Award, unless and until the Board has determined, with advice of counsel, that the
issuance of such shares is in compliance with all applicable laws, regulations of governmental
authorities and, if applicable, the requirements of any exchange on which the shares of Common
Stock are listed or traded, and the shares of Common Stock are covered by an effective registration
statement or applicable exemption from registration. In addition to the terms and conditions
provided herein, the Board may require that a Holder make such reasonable covenants, agreements,
and representations as the Board, in its discretion, deems advisable in order to comply with any
such laws, regulations, or requirements. 



(b) All Common Stock certificates delivered pursuant to the Plan and all shares issued pursuant to
book entry procedures are subject to any stop-transfer orders and other restrictions as the
Administrator deems necessary or advisable to comply with federal, state, or foreign securities or
other laws, rules and regulations and the rules of any securities exchange or automated quotation
system on which the Common Stock is listed, quoted, or traded. The Administrator may place legends
on any Common Stock certificate or book entry to reference restrictions applicable to the Common
Stock.



(c) The Administrator shall have the right to require any Holder to comply with any timing or other
restrictions with respect to the settlement, distribution or exercise of any Award, including a
window-period limitation, as may be imposed in the sole discretion of the Administrator.



(d) No fractional shares of Common Stock shall be issued and the Administrator shall determine, in
its sole discretion, whether cash shall be given in lieu of fractional shares or whether such
fractional shares shall be eliminated by rounding down.



11.5 Forfeiture Provisions.  Pursuant to its general authority to determine the terms and
conditions applicable to Awards under the Plan, the Administrator shall have the right to provide,
in the terms of Awards made under the Plan, or to require a Holder to agree by separate written
instrument, that: (a)(i) any proceeds, gains or other economic benefit actually or constructively
received by the Holder upon any receipt or exercise of the Award, or upon the receipt or resale of
any Common Stock underlying the Award, must be paid to the Company, and (ii) the Award shall
terminate and any unexercised portion of the Award (whether or not vested) shall be forfeited, if
(b)(i) a Termination of Service occurs prior to a specified date, or within a specified time period
following receipt or exercise of the Award, or (ii) the Holder at any time, or during a specified
time period, engages in any activity in competition with the Company, or which is inimical,
contrary or harmful to the interests of the Company, as further defined by the Administrator or
(iii) the Holder incurs a Termination of Service for “cause” (as such term is defined in the sole
discretion of the Administrator, or as set forth in a written agreement relating to such Award
between the Company and the Holder).



(a) Modification of Rights Upon Termination.  Notwithstanding the other provisions of this
Section 11.5, and subject to Section 11.6 and Section 13.2(d), upon a Holder’s termination of
employment or other service with the Company and all Subsidiaries, the Committee may, in its sole
discretion (which may be exercised at any time on or after the date of grant, including following
such termination), cause the Holder’s Options and Stock Appreciation Rights (or any part thereof)
to become or continue to become exercisable and/or remain exercisable following such termination of
employment or service and the Holder’s Restricted Stock, Performance Units and Stock Payments to
vest and/or continue to vest or become free of transfer restrictions, as the case may be, following
such termination of employment or service, in each case in the manner determined by the
Committee; provided , however , that no Option or Restricted Stock may become
exercisable or vest prior to six months from its date of grant (other than in connection with
Holder’s death or Disability) or remain exercisable or continue to vest beyond its expiration date.



(b) Exercise of Incentive Stock Options Following Termination.  Any Incentive Stock Option
that remains unexercised more than one year following termination of employment by reason of
Disability or more than three months following termination for any reason other than death or
Disability will thereafter be deemed to be a Non-Statutory Stock Option.



(c) Date of Termination of Employment or Other Service.  Unless the Committee otherwise
determines in its sole discretion, a Holder’s employment or other service will, for purposes of the
Plan, be deemed to have terminated on the date recorded on the personnel or other records of the
Company or the Subsidiary for which the Holder provides employment or other service, as determined
by the Committee in its sole discretion based upon such records.



11.6 Breach of Confidentiality or Non-Compete Agreements.  Notwithstanding anything in the
Plan to the contrary, in the event that a Holder materially breaches the terms of any
confidentiality or non-compete agreement entered into with the Company or any Subsidiary, whether
such breach occurs before or after termination of such Holder’s employment or other service with
the Company or any Subsidiary, the Committee in its sole discretion may immediately terminate all
rights of the Holder under the Plan and any applicable Award Agreements without notice of any kind.



11.7 Prohibition on Repricing.  Subject to Section 13.2, the Administrator shall not,
without the approval of the stockholders of the Company, authorize the amendment of any outstanding
Award to reduce its price per share. Furthermore, subject to Section 13.2, no Award shall be
canceled and replaced with the grant of an Award having a lesser price per share without the
further approval of stockholders of the Company. Subject to Section 13.2, the Administrator shall
have the authority, without the approval of the stockholders of the Company, to amend any
outstanding award to increase the price per share or to cancel and replace an Award with the grant
of an Award having a price per share that is greater than or equal to the price per share of the
original Award. Notwithstanding any other provision of the Plan to the contrary, no Award shall be
exchanged for cash.



11.8 Full Value Award Vesting Limitations.  Notwithstanding any other provision of the Plan
to the contrary, Full Value Awards made to Employees shall become vested over a period of not less
than three years (or, in the case of vesting based upon the attainment of Performance Goals or
other performance-based objectives, over a period of not less than one year measured from the
commencement of the period over which performance is evaluated) following the date the Award is
made; provided , however , that, notwithstanding the foregoing, Full Value Awards
that result in the issuance of an aggregate of up to 10% of the shares of Stock available pursuant
to Section 3.1(a) may be granted to any one or more Holders without respect to such minimum vesting
provisions.



11.9 Deferrals and Settlements.  The Committee may permit Holders to elect to defer the
issuance of shares or the settlement of Awards in cash under such rules and procedures as it may
establish under the Plan; provided that any such election to defer shares or the
settlement of Awards shall comply with Section 409A. It may also provide that deferred settlements
include the payment or crediting of interest or dividend equivalents on the deferral amounts.



ARTICLE 12.




ADMINISTRATION




12.1 Administrator.  The Plan will be administered by the Compensation and Management
Development Committee or its delegate (the “ Committee ”). So long as the Company has a
class of its equity securities registered under Section 12 of the Exchange Act, the Committee
administering the Plan will consist solely of two or more members of the Board who are
“non-employee directors” within the meaning of Rule 16b-3 under the Exchange Act and, if the Board
so determines in its sole discretion, who are “outside directors” within the meaning of
Section 162(m) of the Code. The Committee will act by majority approval of the members (but may
also take action with the written consent of all of the members of the Committee), and a majority
of the members of the Committee will constitute a quorum. To the extent consistent with applicable
corporate law of the Company’s jurisdiction of incorporation, the Committee may delegate to any
officers of the Company the duties, power and authority of the Committee under the Plan pursuant to
such conditions or limitations as the Committee may establish; provided , however
        , that only the Committee may exercise such duties, power and authority with respect to Eligible
Recipients who are subject to Section 16 of the Exchange Act. The Committee may exercise its
duties, power and authority under the Plan in its sole and absolute discretion without the consent
of any Holder or other party, unless the Plan specifically provides otherwise. Each determination,
interpretation or other action made or taken by the Committee pursuant to the provisions of the
Plan will be final, conclusive and binding for all purposes and on all persons, including, without
limitation, the Company, the stockholders of the Company, the Holders and their respective
successors-in-interest. No member of the Committee will be liable for any action or determination
made in good faith with respect to the Plan or any Incentive Award granted under the Plan.



12.2 Duties and Powers of Committee.  It shall be the duty of the Committee to conduct the
general administration of the Plan in accordance with its provisions. The Committee shall have the
power to interpret the Plan and the Award Agreement, and to adopt such rules for the
administration, interpretation and application of the Plan as are not inconsistent therewith, to
interpret, amend or revoke any such rules and to amend any Award Agreement provided that
the rights or obligations of the holder of the Award that is the subject of any such Award
Agreement are not affected adversely by such amendment, unless the consent of the Holder is
obtained or such amendment is otherwise permitted under Section 13.10. Any such grant or award
under the Plan need not be the same with respect to each holder. No amendment or modification to an
Award, whether pursuant to this Section 12.2 or any other provisions of the Plan, will be deemed to
be a re-grant of such Award for purposes of this Plan. Any such interpretations and rules with
respect to Incentive Stock Options shall be consistent with the provisions of Section 422 of the
Code. In its sole discretion, the Board may at any time and from time to time exercise any and all
rights and duties of the Committee under the Plan except with respect to matters which under
Rule 16b-3 under the Exchange Act or any successor rule, or Section 162(m) of the Code, or any
regulations or rules issued there under, are required to be determined in the sole discretion of
the Committee.



12.3 Authority of Administrator.  Subject to any specific designation in the Plan, the
Administrator has the exclusive power, authority and sole discretion to:



(a) Designate Eligible Individuals to receive Awards;



(b) Determine the type or types of Awards to be granted to each Holder;



(c) Determine the number of Awards to be granted and the number of shares of Common Stock to which
an Award will relate;



(d) Determine the terms and conditions of any Award granted pursuant to the Plan, including, but
not limited to, the exercise price, grant price, or purchase price, any restrictions or limitations
on the Award, any schedule for vesting, lapse of forfeiture restrictions or restrictions on the
exercisability of an Award, and accelerations or waivers thereof, and any provisions related to
non-competition and recapture of gain on an Award, based in each case on such considerations as the
Administrator in its sole discretion determines; (e) Determine whether, to what extent, and
pursuant to what circumstances an Award may be settled in, or the exercise price of an Award may be
paid in cash, Common Stock, other Awards, or other property, or an Award may be canceled,
forfeited, or surrendered;



(f) Prescribe the form of each Award Agreement, which need not be identical for each Holder;



(g) Decide all other matters that must be determined in connection with an Award;



(h) Establish, adopt, or revise any rules and regulations as it may deem necessary or advisable to
administer the Plan;



(i) Interpret the terms of, and any matter arising pursuant to, the Plan or any Award
Agreement; and



(j) Make all other decisions and determinations that may be required pursuant to the Plan or as the
Administrator deems necessary or advisable to administer the Plan.



12.4 Decisions Binding.  The Administrator’s interpretation of the Plan, any Awards granted
pursuant to the Plan, any Award Agreement and all decisions and determinations by the Administrator
with respect to the Plan are final, binding, and conclusive on all parties.



12.5 Delegation of Authority.  To the extent permitted by applicable law, the Board or
Committee may from time to time delegate to a committee of one or more members of the Board or one
or more officers of the Company the authority to grant or amend Awards; provided ,
however , that in no event shall an officer be delegated the authority to grant awards to, or
amend awards held by, the following individuals: (a) individuals who are subject to Section 16 of
the Exchange Act, (b) Covered Employees, or (c) officers of the Company (or Directors) to whom
authority to grant or amend Awards has been delegated hereunder. Any delegation hereunder shall be
subject to the restrictions and limits that the Board or Committee specifies at the time of such
delegation, and the Board may at any time rescind the authority so delegated or appoint a new
delegatee. At all times, the delegatee appointed under this Section 12.5 shall serve in such
capacity at the pleasure of the Board and the Committee.



ARTICLE 13.




MISCELLANEOUS PROVISIONS




13.1 Amendment, Suspension or Termination of the Plan.  Except as otherwise provided in
this Section 13.1, the Plan may be wholly or partially amended or otherwise modified, suspended or
terminated at any time or from time to time by the Board. However, without approval of the
Company’s stockholders given within twelve (12) months before or after the action by the
Administrator, no action of the Administrator may, except as provided in Section 13.2, (i) increase
the limits imposed in Section 3.1 on the maximum number of shares which may be issued under the
Plan, (ii) increase the limits imposed in Section 3.3 on the maximum number of shares that may be
granted to any one person during any calendar year or (iii) decrease the exercise price of any
outstanding Option or Stock Appreciation Right granted under the Plan; or (iv) otherwise cause or
effect a material modification of the Plan. Except as provided in Section 13.10, no amendment,
suspension or termination of the Plan shall, without the consent of the Holder, impair any rights
or obligations under any Award theretofore granted or awarded, unless the Award itself otherwise
expressly so provides. No Awards may be granted or awarded during any period of suspension or after
termination of the Plan, and in no event may any Award be granted under the Plan after the tenth
(10th) anniversary of the Effective Date.



13.2 Changes in Common Stock or Assets of the Company, Acquisition or Liquidation of the
Company and Other Corporate Events .



(a) In the event of any stock dividend, stock split, combination or exchange of shares, merger,
consolidation or other distribution (other than normal cash dividends) of Company assets to
stockholders, or any other change affecting the shares of the Company’s stock or the share price of
the Company’s stock other than an Equity Restructuring, the Administrator shall make equitable
adjustments, if any, to reflect such change with respect to (i) the aggregate number and kind of
shares that may be issued under the Plan (including, but not limited to, adjustments of the
limitations in Section 3.1 on the maximum number and kind of shares which may be issued under the
Plan, adjustments of the Award Limit and adjustments of the manner in which shares subject to Full
Value Awards will be counted); (ii) the number and kind of shares of Common Stock (or other
securities or property) subject to outstanding Awards; (iii) the terms and conditions of any
outstanding Awards (including, without limitation, any applicable performance targets or criteria
with respect thereto); and (iv) the grant or exercise price per share for any outstanding Awards
under the Plan. Any adjustment affecting an Award intended as Performance-Based Compensation shall
be made consistent with the requirements of Section 162(m) of the Code.



(b) In the event of any transaction or event described in Section 13.2(a) or any unusual or
nonrecurring transactions or events affecting the Company, any affiliate of the Company, or the
financial statements of the Company or any affiliate, or of changes in applicable laws, regulations
or accounting principles, the Administrator, in its sole discretion, and on such terms and
conditions as it deems appropriate, either by the terms of the Award or by action taken prior to
the occurrence of such transaction or event and either automatically or upon the Holder’s request,
is hereby authorized to take any one or more of the following actions whenever the Administrator
determines that such action is appropriate in order to prevent dilution or enlargement of the
benefits or potential benefits intended to be made available under the Plan or with respect to any
Award under the Plan, to facilitate such transactions or events or to give effect to such changes
in laws, regulations or principles.



(i) To provide for either (A) termination of any such Award in exchange for an amount of cash, if
any, equal to the amount that would have been attained upon the exercise of such Award or
realization of the Holder’s rights (and, for the avoidance of doubt, if as of the date of the
occurrence of the transaction or event described in this Section 13.2 the Administrator determines
in good faith that no amount would have been attained upon the exercise of such Award or
realization of the Holder’s rights, then such Award may be terminated by the Company without
payment) or (B) the replacement of such Award with other rights or property selected by the
Administrator in its sole discretion having an aggregate value not exceeding the amount that could
have been attained upon the exercise of such Award or realization of the Holder’s rights had such
Award been currently exercisable or payable or fully vested;



(ii) To provide that such Award be assumed by the successor or survivor corporation, or a parent or
subsidiary thereof, or shall be substituted for by similar options, rights or awards covering the
stock of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate
adjustments as to the number and kind of shares and prices;



(iii) To make adjustments in the number and type of shares of the Company’s stock (or other
securities or property) subject to outstanding Awards, and in the number and kind of outstanding
Restricted Stock or Deferred Stock and/or in the terms and conditions of (including the grant or
exercise price), and the criteria included in, outstanding Awards and Awards which may be granted
in the future;



(iv) To provide that such Award shall be exercisable or payable or fully vested with respect to all
shares covered thereby, notwithstanding anything to the contrary in the Plan or the applicable
Award Agreement; and



(v) To provide that the Award cannot vest, be exercised or become payable after such event.



(c) In connection with the occurrence of any Equity Restructuring, and notwithstanding anything to
the contrary in Sections 13.2(a) and 13.2(b):



(i) The number and type of securities subject to each outstanding Award and the exercise price or
grant price thereof, if applicable, shall be equitably adjusted. The adjustments provided under
this Section 13.2(c) shall be nondiscretionary and shall be final and binding on the affected
Holder and the Company.



(ii) The Administrator shall make such equitable adjustments, if any, as the Administrator in its
discretion may deem appropriate to reflect such Equity Restructuring with respect to the aggregate
number and kind of shares that may be issued under the Plan (including, but not limited to,
adjustments of the limitations in Section 3.1 on the maximum number and kind of shares which may be
issued under the Plan, adjustments of the Award Limit and adjustments of the manner in which shares
subject to Full Value Awards will be counted).



(d) Without limiting the authority of the Committee otherwise set forth in this Article 13 or
Article 12, if a Change in Control of the Company occurs, then, unless otherwise provided by the
Committee in its sole discretion in the Award Agreement and subject to Section 11.5, (a) all
Options and Stock Appreciation Rights that have been outstanding for at least six months will
become immediately exercisable in full and will remain exercisable for the remainder of their
terms, regardless of whether the Holder to whom such Options or Stock Appreciation Rights have been
granted remains in the employ or service of the Company or any Subsidiary; (b) all Restricted Stock
that have been outstanding for at least six months will become immediately fully vested and
non-forfeitable; and (c) all outstanding Performance Awards and Stock Payments then held by the
Holder will vest and/or continue to vest in the manner determined by the Committee and set forth in
the agreement evidencing such Stock Payments.



(e) If a Change in Control of the Company occurs, then the Committee, if approved by the Committee
in its sole discretion in an Award Agreement, and without the consent of any Holder affected
thereby, may determine that some or all Holders holding outstanding Options will receive, with
respect to some or all of the shares of Common Stock subject to such Options, as of the effective
date of any such Change in Control of the Company, cash in an amount equal to the excess of the
Fair Market Value of such shares immediately prior to the effective date of such Change in Control
of the Company over the exercise price per share of such Options.



(f) Notwithstanding anything in Section 13.2(d) or Section 13.2(e) to the contrary, if, with
respect to a Holder, the acceleration of the vesting of an Award as provided in Section 13.2(d) or
the payment of cash in exchange for all or part of an Award as provided in Section 13.2(e) (which
acceleration or payment could be deemed a “payment” within the meaning of Section 280G(b)(2) of the
Code), together with any other “payments” that such Holder has the right to receive from the
Company or any corporation that is a member of an “affiliated group” (as defined in Section 1504(a)
of the Code without regard to Section 1504(b) of the Code) of which the Company is a member, would
constitute a “parachute payment” (as defined in Section 280G(b)(2) of the Code), then the
“payments” to such Holder pursuant to Section 13.2(d) or 13.2(e) of the Plan will be reduced to the
largest amount as will result in no portion of such “payments” being subject to the excise tax
imposed by Section 4999 of the Code; provided , however , that if a Holder is
subject to a separate agreement with the Company or a Subsidiary that expressly addresses the
potential application of Sections 280G or 4999 of the Code (including, without limitation, that
“payments” under such agreement or otherwise will be reduced, that the Holder will have the
discretion to determine which “payments” will be reduced, that such “payments” will not be reduced
or that such “payments” will be “grossed up” for tax purposes), then this Section 13.2(f) will not
apply, and any “payments” to a Holder pursuant to Section 13.2(d) or 13.2(e) of the Plan will be
treated as “payments” arising under such separate agreement.



(g) The Administrator may, in its sole discretion, include such further provisions and limitations
in any Award, agreement or certificate, as it may deem equitable and in the best interests of the
Company that are not inconsistent with the provisions of the Plan.



(h) With respect to Awards which are granted to Covered Employees and are intended to qualify as
Performance-Based Compensation, no adjustment or action described in this Section 13.2 or in any
other provision of the Plan shall be authorized to the extent that such adjustment or action would
cause such Award to fail to so qualify as Performance-Based Compensation, unless the Administrator
determines that the Award should not so qualify. No adjustment or action described in this
Section 13.2 or in any other provision of the Plan shall be authorized to the extent that such
adjustment or action would cause the Plan to violate Section 422(b)(1) of the Code. Furthermore, no
such adjustment or action shall be authorized to the extent such adjustment or action would result
in short-swing profits liability under Section 16 or violate the exemptive conditions of Rule 16b-3
unless the Administrator determines that the Award is not to comply with such exemptive conditions.



(i) The existence of the Plan, the Award Agreement and the Awards granted hereunder shall not
affect or restrict in any way the right or power of the Company or the stockholders of the Company
to make or authorize any adjustment, recapitalization, reorganization or other change in the
Company’s capital structure or its business, any merger or consolidation of the Company, any issue
of stock or of options, warrants or rights to purchase stock or of bonds, debentures, preferred or
prior preference stocks whose rights are superior to or affect the Common Stock or the rights
thereof or which are convertible into or exchangeable for Common Stock, or the dissolution or
liquidation of the company, or any sale or transfer of all or any part of its assets or business,
or any other corporate act or proceeding, whether of a similar character or otherwise.



(j) No action shall be taken under this Section 13.2 which shall cause an Award to fail to comply
with Section 409A of the Code or the Treasury Regulations there under, to the extent applicable to
such Award.



13.3  Approval of Plan by Stockholders.  The Plan will be submitted for the approval of the
Company’s stockholders within twelve (12) months after the date of the Board’s initial adoption of
the Plan. Awards may be granted or awarded prior to such stockholder approval, provided
that such Awards shall not be exercisable, shall not vest and the restrictions thereon shall not
lapse and no shares of Common Stock shall be issued pursuant thereto prior to the time when the
Plan is approved by the stockholders, and provided , further , that if such
approval has not been obtained at the end of said twelve (12) month period, all Awards previously
granted or awarded under the Plan shall thereupon be canceled and become null and void.



13.4 No Stockholders Rights.  Except as otherwise provided herein, a Holder shall have none
of the rights of a stockholder with respect to shares of Common Stock covered by any Award until
the Holder becomes the record owner of such shares of Common Stock.



13.5 Paperless Administration.  In the event that the Company establishes, for itself or
using the services of a third party, an automated system for the documentation, granting or
exercise of Awards, such as a system using an internet website or interactive voice response, then
the paperless documentation, granting or exercise of Awards by a Holder may be permitted through
the use of such an automated system.



13.6 Effect of Plan upon Other Compensation Plans.  The adoption of the Plan shall not
affect any other compensation or incentive plans in effect for the Company or any Subsidiary.
Nothing in the Plan shall be construed to limit the right of the Company or any Subsidiary: (a) to
establish any other forms of incentives or compensation for Employees or Directors of the Company
or any Subsidiary, or (b) to grant or assume options or other rights or awards otherwise than under
the Plan in connection with any proper corporate purpose including without limitation, the grant or
assumption of options in connection with the acquisition by purchase, lease, merger, consolidation
or otherwise, of the business, stock or assets of any corporation, partnership, limited liability
company, firm or association.



13.7 Compliance with Laws.  The Plan, the granting and vesting of Awards under the Plan and
the issuance and delivery of shares of Common Stock and the payment of money under the Plan or
under Awards granted or awarded hereunder are subject to compliance with all applicable federal,
state, local and foreign laws, rules and regulations (including but not limited to state, federal
and foreign securities law and margin requirements) and to such approvals by any listing,
regulatory or governmental authority as may, in the opinion of counsel for the Company, be
necessary or advisable in connection therewith. Any securities delivered under the Plan shall be
subject to such restrictions, and the person acquiring such securities shall, if requested by the
Company, provide such assurances and representations to the Company as the Company may deem
necessary or desirable to assure compliance with all applicable legal requirements. To the extent
permitted by applicable law, the Plan and Awards granted or awarded hereunder shall be deemed
amended to the extent necessary to conform to such laws, rules and regulations.



13.8 Titles and Headings, References to Sections of the Code or Exchange Act.  The titles
and headings of the Sections in the Plan are for convenience of reference only and, in the event of
any conflict, the text of the Plan, rather than such titles or headings, shall control. References
to sections of the Code or the Exchange Act shall include any amendment or successor thereto.



13.9 Governing Law.  The Plan and any agreements hereunder shall be administered,
interpreted and enforced under the internal laws of the State of Delaware without regard to
conflicts of laws thereof.



13.10 Section 409A.



(a) To the extent applicable, the Plan and Award Agreements shall be interpreted in accordance with
Section 409A of the Code and Department of Treasury regulations and other interpretive guidance
issued there under, including without limitation any such regulations or other guidance that may be
issued after the Effective Date. Notwithstanding any provision of the Plan to the contrary, in the
event that following the Effective Date the Administrator determines that any Award may be subject
to Section 409A of the Code and related Department of Treasury guidance (including such Department
of Treasury guidance as may be issued after the Effective Date), the Administrator may adopt
(without any obligation to do so or to indemnify any Holder for failure to do so) such amendments
to the Plan and the applicable Award Agreement or adopt other policies and procedures (including
amendments, policies and procedures with retroactive effect), or take any other actions, that the
Administrator determines are necessary or appropriate to (a) exempt the Award from Section 409A of
the Code and/or preserve the intended tax treatment of the benefits provided with respect to the
Award, or (b) comply with the requirements of Section 409A of the Code and related Department of
Treasury guidance and thereby avoid the application of any penalty taxes under such Section.



(b) To the extent that the Administrator determines that any Award granted under the Plan is
subject to Section 409A of the Code (a “ Section 409A Award ”), the Award Agreement
evidencing such Award shall incorporate the terms and conditions required by Section 409A of the
Code, including, without limitation, the terms set forth on Annex A hereto.



13.11 No Rights to Awards.  No Eligible Individual or other person shall have any claim to
be granted any Award pursuant to the Plan, and neither the Company nor the Administrator is
obligated to treat Eligible Individuals, Holders or any other persons uniformly.



13.12 Unfunded Status of Awards.  The Plan is intended to be an “unfunded” plan for
incentive compensation. With respect to any payments not yet made to a Holder pursuant to an Award,
nothing contained in the Plan or any Award Agreement shall give the Holder any rights that are
greater than those of a general creditor of the Company or any Subsidiary.



13.13 Indemnification.  To the extent allowable pursuant to applicable law, each member of
the Committee or of the Board shall be indemnified and held harmless by the Company from any loss,
cost, liability, or expense that may be imposed upon or reasonably incurred by such member in
connection with or resulting from any claim, action, suit, or proceeding to which he or she may be
a party or in which he or she may be involved by reason of any action or failure to act pursuant to
the Plan and against and from any and all amounts paid by him or her in satisfaction of judgment in
such action, suit, or proceeding against him or her; provided he or she gives the Company
an opportunity, at its own expense, to handle and defend the same before he or she undertakes to
handle and defend it on his or her own behalf. The foregoing right of indemnification shall not be
exclusive of any other rights of indemnification to which such persons may be entitled pursuant to
the Company’s Certificate of Incorporation or Bylaws, as a matter of law, or otherwise, or any
power that the Company may have to indemnify them or hold them harmless.



13.14 Relationship to other Benefits.  No payment pursuant to the Plan shall be taken into
account in determining any benefits under any pension, retirement, savings, profit sharing, group
insurance, welfare or other benefit plan of the Company or any Subsidiary except to the extent
otherwise expressly provided in writing in such other plan or an agreement there under.



13.15 Expenses.  The expenses of administering the Plan shall be borne by the Company and
its Subsidiaries.



• * * * *



I hereby certify that the foregoing Plan was duly adopted by the Board of Directors of Nash-Finch
Company on          , 200  .



• * * * *



I hereby certify that the foregoing Plan was approved by the stockholders of Nash-Finch Company
on          , 200  .



Executed on this           day of          , 200  .

 


Corporate Secretary



Section 409A Annex




1. Distributions under a Section 409A Award.



a. Subject to subsection (b), any shares of Common Stock or other property or amounts to be paid or
distributed upon the grant, issuance, vesting, exercise or payment of a Section 409A Award shall be
distributed in accordance with the requirements of Section 409A(a)(2) of the Code, and shall not be
distributed earlier than:



i. the Holder’s separation from service, as determined by the Secretary of the Treasury,



ii. the date the Holder becomes disabled,



iii. the Holder’s death,



iv. a specified time (or pursuant to a fixed schedule) specified under the Award Agreement at the
date of the deferral compensation,



v. to the extent provided by the Secretary of the Treasury, a change in the ownership or effective
control of the Company or a Subsidiary, or in the ownership of a substantial portion of the assets
of the Company or a Subsidiary, or



vi. the occurrence of an unforeseeable emergency with respect to the Holder.



 b. In the case of a Holder who is a “specified employee”, the requirement of paragraph (1)(a)
shall be met only if the distributions with respect to the Section 409A Award may not be made
before the date which is six months after the Holder’s separation from service (or, if earlier, the
date of the Holder’s death). For purposes of this subsection (b), a Holder shall be a “specified
employee” if such Holder is a key employee (as defined in Section 416(i) of the Code without regard
to paragraph (5) thereof) of a corporation any stock of which is publicly traded on an established
securities market or otherwise, as determined under Section 409A(a)(2)(B)(i) of the Code and the
Treasury Regulations there under.



c. The requirement of paragraph (1)(a)(vi) shall be met only if, as determined under Treasury
Regulations under Section 409A(a)(2)(B)(ii) of the Code, the amounts distributed with respect to
the unforeseeable emergency do not exceed the amounts necessary to satisfy such unforeseeable
emergency plus amounts necessary to pay taxes reasonably anticipated as a result of the
distribution, after taking into account the extent to which such unforeseeable emergency is or may
be relieved through reimbursement or compensation by insurance or otherwise or by liquidation of
the Holder’s assets (to the extent the liquidation of such assets would not itself cause severe
financial hardship).



d. For purposes of this subsection, the terms specified therein shall have the respective meanings
ascribed thereto under Section 409A of the Code and the Treasury Regulations there under.



2. Prohibition on Acceleration of Benefits.  The time or schedule of any distribution or
payment of any shares of Common Stock or other property or amounts under a Section 409A Award shall
not be accelerated, except as otherwise permitted under Section 409A(a)(3) of the Code and the
Treasury Regulations there under.



3. Elections under Section 409A Awards.



a. Any deferral election provided under or with respect to an Award to any Employee or Non-Employee
Director, or to the Holder of a Section 409A Award, shall satisfy the requirements of
Section 409A(a)(4)(B) of the Code, to the extent applicable, and, except as otherwise permitted
under paragraph (i) or (ii), any such deferral election with respect to compensation for services
performed during a taxable year shall be made not later than the close of the preceding taxable
year, or at such other time as provided in Treasury Regulations.



i. In the case of the first year in which an Employee or Non-Employee Director, or the Holder,
becomes eligible to participate in the Plan (or any other plan or arrangement of the Company that
is aggregated with the Plan pursuant to Treasury Regulation Section 1.409A-1(c)), any such deferral
election may be made with respect to services to be performed subsequent to the election with
thirty (30) days after the date the Employee or Non-Employee Director, or the Holder, becomes
eligible to participate in the Plan (or any other plan or arrangement of the Company that is
aggregated with the Plan pursuant to Treasury Regulation Section 1.409A-1(c)), as provided under
Section 409A(a)(4)(B)(ii) of the Code.



ii. In the case of any performance-based compensation based on services performed by an Employee or
Non-Employee Director, or the Holder, over a period of at least twelve (12) months, any such
deferral election may be made no later than six months before the end of the period, as provided
under Section 409A(a)(4)(B)(iii) of the Code.



b. In the event that a Section 409A Award permits, under a subsequent election by the Holder of
such Section 409A Award, a delay in a distribution or payment of any shares of Common Stock or
other property or amounts under such Section 409A Award, or a change in the form of distribution or
payment, such subsequent election shall satisfy the requirements of Section 409A(a)(4)(C) of the
Code, such subsequent election may not take effect until at least twelve (12) months after the date
on which the election is made, and in the case such subsequent election relates to a distribution
or payment not described in Section (1)(a)(ii), (iii) or (vi), the first payment with respect to
such election may be deferred for a period of not less than five years from the date such
distribution or payment otherwise would have been made, and in the case such subsequent election
relates to a distribution or payment described in Section (1)(a)(iv), such election may not be made
less than twelve (12) months prior to the date of the first scheduled distribution or payment under
Section (1)(a)(iv).



4. Compliance in Form and Operation.  A Section 409A Award, and any election under or with
respect to such Section 409A Award, shall comply in form and operation with the requirements of
Section 409A of the Code and the Treasury Regulations there under.