Exhibit 10.2 





SCHOLASTIC CORPORATION

MANAGEMENT STOCK PURCHASE PLAN





Amended and Restated on September 23, 2008






SCHOLASTIC CORPORATION 

MANAGEMENT STOCK PURCHASE PLAN 

(Amended and Restated on September 23, 2008)


TABLE OF CONTENTS


	
 

	
 

	
 

	
 

	
 

	
 


	
ARTICLE 1 -

	
Introduction

	
 

	
1


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
1.1

	
 

	
Purpose

	
 

	
1


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
1.2

	
 

	
Restatement

	
 

	
1


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
1.3

	
 

	
Plan Bifurcation

	
 

	
1


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
1.4

	
 

	
Section 409A of the Code

	
 

	
1


	
 

	
 

	
 

	
 

	
 


	
ARTICLE 2 -

	
Definitions

	
 

	
1


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.1

	
 

	
Affiliate

	
 

	
1


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.2

	
 

	
Award Date

	
 

	
2


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.3

	
 

	
Beneficiary

	
 

	
2


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.4

	
 

	
Bonus

	
 

	
2


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.5

	
 

	
Board of Directors

	
 

	
2


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.6

	
 

	
Cause

	
 

	
2


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.7

	
 

	
Code

	
 

	
2


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.8

	
 

	
Committee

	
 

	
2


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.9

	
 

	
Common Stock or Stock

	
 

	
2


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.10

	
 

	
Company

	
 

	
2


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.11

	
 

	
Cost

	
 

	
3


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.12

	
 

	
Deferral Period

	
 

	
3


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.13

	
 

	
Disability

	
 

	
3


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.14

	
 

	
Exchange Act

	
 

	
3


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.15

	
 

	
Extension of Deferral
 Election Form

	
 

	
3


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.16

	
 

	
Fair Market Value

	
 

	
3


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.17

	
 

	
Fiscal Year

	
 

	
3


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.18

	
 

	
Foreign Jurisdiction

	
 

	
3


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.19

	
 

	
Grandfathered Plan

	
 

	
3


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.20

	
 

	
Participant

	
 

	
3


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.21

	
 

	
Plan

	
 

	
3


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.22

	
 

	
Plan Year

	
 

	
3


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.23

	
 

	
Retirement

	
 

	
4





i






	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.24

	
 

	
RSU

	
 

	
4


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.25

	
 

	
Rule 16b-3

	
 

	
4


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.26

	
 

	
Specified Employee

	
 

	
4


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.27

	
 

	
Subscription Agreement

	
 

	
4


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
2.28

	
 

	
Subsequent Deferral Period

	
 

	
4


	
 

	
 

	
 

	
 

	
 

	
 


	
ARTICLE 3 -

	
     Shares
 Reserved

	
 

	
4


	
 

	
 

	
 

	
 

	
 

	
 


	
ARTICLE 4 -

	
     Administration

	
 

	
5


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
4.1

	
 

	
Administration of the Plan

	
 

	
5


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
4.2

	
 

	
Decisions Binding

	
 

	
5


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
4.3

	
 

	
Delegation of Authority

	
 

	
5


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
4.4

	
 

	
Indemnification

	
 

	
5


	
 

	
 

	
 

	
 

	
 

	
 


	
ARTICLE 5 -

	
     Eligibility

	
 

	
6


	
 

	
 

	
 

	
 

	
 

	
 


	
ARTICLE 6 -

	
     Purchases

	
 

	
6


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
6.1

	
 

	
General

	
 

	
6


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
6.2

	
 

	
Voluntary Purchases

	
 

	
6


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
6.3

	
 

	
Awards of RSUs

	
 

	
7


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
6.4

	
 

	
Subsequent Deferral
 Election

	
 

	
7


	
 

	
 

	
 

	
 

	
 

	
 


	
ARTICLE 7 -

	
     Vesting
 and Payment of RSUs

	
 

	
7


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
7.1

	
 

	
Vesting

	
 

	
7


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
7.2

	
 

	
Payment on or after
 Vesting

	
 

	
8


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
7.3

	
 

	
Payment Prior to Vesting

	
 

	
8


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
7.4

	
 

	
Special Rules for
 Specified Employees

	
 

	
9


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
7.5

	
 

	
Limitation On
 Distributions To Covered Employees

	
 

	
9


	
 

	
 

	
 

	
 

	
 

	
 


	
ARTICLE 8 -

	
     Dividend
 Equivalent Amounts

	
 

	
10


	
 

	
 

	
 

	
 

	
 

	
 


	
ARTICLE 9 -

	
     Designation
 of Beneficiary

	
 

	
10


	
 

	
 

	
 

	
 

	
 

	
 


	
ARTICLE 10 - 

	
     Adjustments

	
 

	
10


	
 

	
 

	
 

	
 

	
 

	
 


	
ARTICLE 11 - 

	
     Amendment
 or Termination of Plan

	
 

	
10


	
 

	
 

	
 

	
 

	
 

	
 


	
ARTICLE 12 - 

	
     Miscellaneous
 Provisions

	
 

	
11


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
12.1

	
 

	
No Distribution;
 Compliance with Legal Requirements

	
 

	
11


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
12.2

	
 

	
Withholding

	
 

	
11


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
12.3

	
 

	
Notices; Delivery of Stock
 Certificates

	
 

	
11


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
12.4

	
 

	
Nontransferability of
 Rights

	
 

	
11


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
12.5

	
 

	
Obligations Unfunded and
 Unsecured

	
 

	
12





ii






	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
12.6

	
 

	
Governing Law

	
 

	
12


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
12.7

	
 

	
Claims Procedure

	
 

	
12


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
12.8

	
 

	
Rule 16b-3

	
 

	
12


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
12.9

	
 

	
Certain Section 409A
 Matters

	
 

	
13


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
12.10

	
 

	
No Employment Rights

	
 

	
13


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
12.11

	
 

	
Severability of Provisions

	
 

	
13


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
12.12

	
 

	
Construction

	
 

	
13


	
 

	
 

	
 

	
 

	
 

	
 


	
 

	
12.13

	
 

	
Effective Date of Plan

	
 

	
13





iii






SCHOLASTIC CORPORATION

MANAGEMENT STOCK PURCHASE PLAN

(Amended and Restated on September 23, 2008)


ARTICLE 1 - INTRODUCTION


                    1.1
Purpose. The purpose of the Scholastic Corporation Management Stock
Purchase Plan (the “Plan”) is to provide equity incentive compensation to
selected management employees of Scholastic Corporation and its Affiliates.
Participants in the Plan receive restricted stock units (“RSUs”) at a discount
in lieu of a portion or all of their bonus awards under the Company’s annual
incentive plan. Under certain circumstances, the RSUs convert into shares of
Common Stock. The Company believes that the Plan creates a means to provide
deferred compensation to such selected management employees and to raise the
level of stock ownership in the Company by such employees thereby strengthening
the mutuality of interests between such employees and the Company’s
stockholders. 


                    1.2
Restatement. The Company hereby amends and restates the Plan to comply
with the requirements of Section 409A of the Internal Revenue Code of 1986, as
amended and the final Treasury regulations issued thereunder. The effective
date of this amendment and restatement January 1, 2005. 


                    1.3
Plan Bifurcation. RSUs granted under the Plan on and after January 1,
2005 and RSUs granted under the Plan prior to January 1, 2005, which are not
vested as of December 31, 2004, shall be governed by the terms and conditions
of the plan document as set forth herein. RSUs granted and vested under the
Plan prior to January 1, 2005 shall be governed by the terms and conditions of
the Plan as in effect on December 31, 2004, which shall be known and referred
to as the “Grandfathered Plan.” All references hereinafter to “Plan” are to the
document set forth herein. Recordkeeping for the Grandfathered Plan and the
Plan shall be done separately. 


                    1.4
Section 409A of the Code. This Plan is intended to comply with the
applicable requirements of Section 409A of the Code and shall be limited,
construed and interpreted in accordance with such intent. To the extent that
any payment or benefit hereunder is subject to Section 409A of the Code, it
shall be paid in a manner that will comply with Section 409A of the Code,
including Treasury regulations issued thereunder and any other guidance issued
by the Secretary of the Treasury and the Internal Revenue Service with respect
thereto. Notwithstanding anything herein to the contrary, any provision in this
Plan that is inconsistent with Section 409A of the Code shall be deemed to be
amended to comply with Section 409A of the Code and to the extent such
provision cannot be amended to comply therewith, such provision shall be null
and void. 






ARTICLE 2 - DEFINITIONS


                    2.1
Affiliate. (i) Any corporation, partnership, limited liability company
or other entity as to which the Company possesses a direct or indirect
ownership interest of at least 50 percent or which possesses a direct or
indirect ownership interest of at least 50 percent in the Company including,
without limitation, any subsidiary corporation (as defined in Section 424(f) of
the Code) and parent corporation (as defined in Section 424(e) of the Code) and
(ii) any other entity in which the Company or any of its Affiliates has a
material equity interest, as determined by the Committee. 


                    2.2
Award Date. The first business day after the end of the fiscal quarter
in which a Bonus for a year is paid or otherwise would have been paid. 


                    2.3
Beneficiary. A beneficiary or beneficiaries designated by the
Participant under Article 9. 


                    2.4
Bonus. A Participant’s annual award for a Fiscal Year under any annual
incentive plan of the Company or its Affiliates that has been designated by the
Committee as eligible for deferral under the Plan pursuant to a Subscription
Agreement. 


                    2.5
Board of Directors. The Board of Directors of the Company or the
Executive Committee of such Board of Directors. 


                    2.6
Cause. Any of the following: (i) any act or acts by the Participant
constituting a felony under the laws of the United States, any state thereof,
or any political subdivision thereof, (ii) the Participant’s willful and
continued failure to perform the duties assigned to him or her as an employee
of the Company or Affiliate; (iii) any material breach by the Participant of
any employment agreement with the Company or Affiliate; (iv) dishonesty, gross
negligence or malfeasance by the Participant in the performance of his or her
duties as an employee of the Company or any Affiliate or any conduct by the
Participant which involves a material conflict of interest with any business of
the Company or its Affiliates; or (v) taking or knowingly omitting to take any
other action or actions in the performance of the Participant’s duties as an
employee of the Company or its Affiliates without informing appropriate members
of management to whom such Participant reports, which in the determination of
the Committee have caused or substantially contributed to the material
deterioration in the business of the Company and its Affiliates, taken as a
whole. 


                    2.7
Code. The Internal Revenue Code of 1986, as amended from time to time. 


                    2.8
Committee. The committee of the Board of Directors authorized to
administer the Plan. To the extent that no Committee exists which has the
authority to administer the Plan, the functions of the Committee shall be
exercised by the Board of Directors. The Committee shall consist of two or more
non-employee directors, each of whom is intended to be, to the extent required
by Rule 16b-3, a “non-employee director” as defined in Rule 16b-3. If for any
reason the appointed Committee does not meet the requirements of Rule 16b-3,
such noncompliance shall not affect the validity of any grants of RSUs
hereunder, interpretations or other actions of the Committee. 


2






                    2.9
Common Stock or Stock. Common stock of the Company, par value $.01 per
share. 


                    2.10
Company. Scholastic Corporation, a corporation organized under the laws
of the State of Delaware (or any successor). 


                    2.11
Cost. The cost of purchasing an RSU under the Plan as of an Award Date,
as determined by the Committee in its sole discretion, but in no event less
than 75% of the lowest Fair Market Value of a share of Common Stock during the
fiscal quarter immediately preceding the Award Date. The cost shall be
established as of the applicable Award Date and shall remain in effect unless
modified by the Committee at least 30 days prior to the applicable Award Date. 


                    2.12
Deferral Period. A period of time (expressed in whole years) not less
than three years beginning on an Award Date as specified by the Participant in
his or her Subscription Agreement with respect to RSUs awarded on that Award
Date. 


                    2.13
Disability. The inability of a Participant to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment that may result in death and, in any case, is expected to continue
for a period of not less than 12 months. 


                    2.14
Exchange Act. The Securities Exchange Act of 1934, as amended. 


                    2.15
Extension of Deferral Election Form. A form used by a Participant to
make a subsequent election to extend the Deferral Period applicable to his or
her RSUs. An Extension of Deferral Election Form shall contain such provisions,
consistent with the provisions of the Plan, as may be established from time to
time by the Company or Committee. 


                    2.16
Fair Market Value. Unless otherwise required by any applicable provision
of the Code or any regulations issued thereunder, as of any date, the last
sales price reported for the Common Stock on the applicable date: (i) as
reported on the principal national securities exchange on which it is then
traded or the Nasdaq Stock Market or (ii) if not traded on any such national
securities exchange or the Nasdaq Stock Market as quoted on an automated
quotation system sponsored by the National Association of Securities Dealers,
Inc. If the Common Stock is not readily tradable on a national securities
exchange, the Nasdaq Stock Market or any automated quotation system sponsored
by the National Association of Securities Dealers, Inc., its Fair Market Value
shall be set in good faith by the Committee. 


                    2.17
Fiscal Year. The fiscal year of the Company. 


                    2.18
Foreign Jurisdiction. Any jurisdiction outside of the United States
including, without limitation, countries, states, provinces and localities. 


                    2.19
Grandfathered Plan. The terms and provisions of the Plan in effect
immediately prior to January 1, 2005. 


                    2.20
Participant. A management employee of the Company or any Affiliate who
satisfies the eligibility requirements under Article 5 of the Plan and elects
to participate in the Plan in accordance with its terms. 


3






                    2.21
Plan. The Scholastic Corporation Management Stock Purchase Plan, as
amended and restated effective as of January 1, 2005, and as may be amended
from time to time thereafter. 


                    2.22
Plan Year. The Fiscal Year. 


                    2.23
Retirement. A termination of employment with the Company and all
Affiliates (other than for Cause) on or after age 55 in accordance with the
Company’s standard retirement policies. 


                    2.24
RSU. A unit of measurement of compensation payable to a Participant
under the Plan equivalent to one share of Common Stock but with none of the
attendant rights of a stockholder of a share of Common Stock, including the
right to vote (if any); except that an RSU shall have the dividend equivalent
described in Article 8. The fair market value of an RSU on any date shall be
deemed to be the Fair Market Value of a share of Common Stock on that date. 


                    2.25
Rule 16b-3. Means Rule 16b-3 promulgated under Section 16(b) of the
Exchange Act or any successor provision. 


                    2.26
Specified Employee. For purposes hereof, “specified employee” shall mean
such persons as shall be determined by the Company. 


                    2.27
Subscription Agreement. An agreement executed by a Participant setting
forth his or her election to defer receipt of a portion or all of his or her
Bonus for the Deferral Period and to authorize the Company to credit such
amount to the Plan in order to purchase an award of RSUs. A Subscription
Agreement shall contain such provisions, consistent with the provisions of the
Plan, as may be established from time to time by the Company or Committee. 


                    2.28
Subsequent Deferral Period. A period of time (expressed in whole years)
of not less than five years, beginning on the date the Deferral Period is
scheduled to end, that is elected by a Participant with respect to his or her
RSUs in accordance with the requirements of Section 6.4 of the Plan; 


ARTICLE 3 - SHARES RESERVED


                    The
aggregate number of shares of Common Stock reserved for issuance pursuant to
the Plan or with respect to which RSUs may be granted shall be 150,000, subject
to adjustment as provided in Article 10 hereof. 


                    Such
number of shares may be set aside out of the authorized but unissued shares of
Common Stock not reserved for any other purpose, or out of issued shares of
Common Stock acquired for and held in the treasury of the Company. If any RSU
awarded under the Plan is forfeited, terminated or canceled for any reason or
is settled without the delivery of Common Stock, the share of Common Stock
relating to such RSU shall again be available under the Plan. If Common Stock has
been exchanged by a Participant as full or partial payment to the Company 


4






for
withholding taxes or otherwise or if the number of shares of Common Stock
otherwise deliverable has been reduced for withholding, the number of shares
exchanged or reduced shall again be available under the Plan. 


ARTICLE 4 - ADMINISTRATION


                    4.1
Administration of the Plan. The Plan shall be administered by the
Committee. The Committee shall have full discretionary power and authority,
subject to the provisions of the Plan, to promulgate such rules and regulations
as it deems necessary for the proper administration of the Plan, to construe
and interpret any doubtful or disputed provisions of the Plan and remedy any
omission, inconsistency or ambiguity in the Plan, to supervise the
administration of the Plan, to determine eligibility to receive benefits and
the amount of benefits under the Plan, and to take all actions in connection
therewith or in relation thereto as it deems necessary or advisable. The Committee
may adopt, amend or repeal any guidelines or requirements necessary for the
delivery of the Common Stock. The Committee may also adopt special guidelines
and provisions for persons who are residing in, or subject to the laws of,
Foreign Jurisdictions to comply with applicable tax and securities laws. 


                    4.2
Decisions Binding. All interpretations and determinations of the
Committee shall be made in its sole and absolute discretion based on the Plan
document and shall be final, conclusive and binding on all parties with respect
to all matters relating to the Plan. 


                    4.3
Delegation of Authority. The Committee may select an administrator or
any other person to whom its duties and responsibilities hereunder may be
delegated. In addition, the Committee may employ such legal counsel,
consultants, brokers and agents as it may deem desirable for the administration
of the Plan and may rely upon any opinion received from any such counsel or
consultant and any computation received from any such consultant, broker or
agent. The Committee may also, in its sole discretion, designate an agent to
keep records, send statements of account to Participants and to perform other
duties relating to the Plan, as the Committee may request from time to time. 


                    4.4
Indemnification. The Company shall, to the fullest extent permitted by
law and the Certificate of Incorporation and By-laws of the Company, to the
extent not covered by insurance, indemnify each director, officer or employee
of the Company and its Affiliates (including the respective heirs, executors,
administrators and other personal representatives of such persons) and each
member of the Committee against all expenses, costs, liabilities and losses
(including attorneys’ fees, judgments, fines, excise taxes or penalties, and
amounts paid or to be paid in settlement) actually and reasonably incurred by
such person in connection with any threatened, pending or actual suit, action
or proceeding (whether civil, criminal, administrative or investigative in
nature or otherwise) in which such person may be involved by reason of the fact
that he or she is or was serving this Plan in any capacity at the request of
the Company, except in instances where any such person engages in willful
neglect or fraud. Such right of indemnification shall include the right to be
paid by the Company for expenses incurred or reasonably anticipated to be
incurred in defending any such suit, action or proceeding in advance of its
disposition; provided, however, that the payment of expenses in advance of the
settlement 


5






or final
disposition of a suit, action or proceeding shall be made only upon delivery to
the Company of an undertaking by or on behalf of such person to repay all
amounts so advanced if it is ultimately determined that such person is not
entitled to be indemnified hereunder. Such indemnification shall be in addition
to any rights of indemnification the person may have as a director, officer or
employee or under the Certificate of Incorporation of the Company or the By-Laws
of the Company. Expenses incurred by the Committee or the Board in the
engagement of any such counsel, consultant or agent shall be paid by the
Company. 


ARTICLE 5 - ELIGIBILITY


                    Management
employees of the Company and its Affiliates as designated by the Committee
shall be eligible to participate in the Plan. Eligibility for participation in
the Plan shall be determined by the Committee in its sole discretion. The
Committee may, in its sole discretion, designate, on a prospective basis, any
Participant in the Plan as ineligible to receive awards of RSUs pursuant to
Article 6 of the Plan. 


ARTICLE 6 - PURCHASES


                    6.1
General. Each Participant shall be entitled to elect to receive up to
100% of his or her Bonus in an award of RSUs. As of the applicable Award Date,
RSUs shall be awarded to Participants and credited to accounts held under the
Plan on behalf of Participants on a book-entry basis calculated in the manner
provided under Section 6.3 and in accordance with Article 1. 


                    6.2
Voluntary Purchases. Under procedures specified by Company, each
Participant may elect to receive up to 100% of his or her Bonus for a Fiscal
Year in an award of RSUs by completing a Subscription Agreement and submitting
it to the Company no later than the last day of the preceding Fiscal Year or,
in the event such Bonus qualifies as “performance-based compensation” (as
defined in Treasury Regulation Section 1.409A-1(e)), no later than the last day
of the second quarter of the Fiscal Year to which the Bonus relates.
Notwithstanding the foregoing, if a management employee of the Company or an
Affiliate first becomes eligible to participate in the Plan after the last day
of the second quarter of the Fiscal Year in which the Bonus is earned, and the
employee is not already eligible to participate in any other nonqualified
deferred compensation plan that is required to be aggregated with the Plan
under Section 409A, such employee may elect to participate in the Plan for that
Plan Year provided he or she completes a Subscription Agreement and submits it
to the Company no later than 30 days after the date the Participant first
became eligible to participate in the Plan but such Participant’s election
shall be limited to the pro rata portion of the Bonus earned after the
Subscription Agreement is executed and delivered to the Company. Each
Subscription Agreement shall provide that the Participant elects to receive
RSUs in lieu of a specified portion of his or her Bonus. Such portion may be
expressed as:  



	
 

	
 

	
 


	
 

	
(a)

	
a specified percentage of up to 100% (in whole percentages) of the
Participant’s actual Bonus amount;








6






	
 

	
 

	
 


	
 

	
(b)

	
a specified dollar amount, up to 100% of the Participant’s actual Bonus amount; or 


	
 

	
 

	
 


	
 

	
(c)

	
the lesser of the amount specified in Section 6.2(a) or (b).





                    Amounts
specified pursuant to any of the methods set forth herein are entirely
contingent on, and are limited to, the cash amount of Bonus actually awarded.
Each Subscription Agreement, in addition, shall specify a Deferral Period with
respect to the RSUs to which it pertains. Other than with respect to a
management employee of the Company or an Affiliate who first becomes eligible
to participate hereunder during a Plan Year, in order for a Subscription
Agreement to be given effect, it must be received by the Company under
procedures specified by Company, but no later than the last day of the Fiscal
Year preceding the Fiscal Year in which services for such Bonus will be
performed or, in the case of a Bonus that is “performance-based compensation”
(as defined in Treasury Regulation Section 1.409A-1(e)), no later than the last
day of the second quarter of the Fiscal Year to which such Bonus relates. With
respect to any Plan Year, a timely election pursuant to a Subscription
Agreement to receive RSUs in lieu of a portion or all of a Bonus shall be
irrevocable and will be effective on and after the date the Subscription Agreement
is executed by the Participant and submitted to the Company. An election by a
Participant to receive RSUs in lieu of a portion or all of a Bonus shall be
valid solely for the Plan Year to which the election relates. If a Subscription
Agreement is not timely submitted by a Participant with respect to any Plan
Year, the Bonus earned in that Plan Year shall not be deferred under the Plan. 


                    6.3
Awards of RSUs. The Company shall award RSUs to each Participant’s
account under the Plan on the Award Date. Each Participant’s account shall be
credited with a number of whole RSUs (rounded down to the nearest whole share)
determined by dividing (a) the amount of the Participant’s Bonus to be received
as an award of RSUs in accordance with the Participant’s Subscription Agreement
and the methodology under Section 6.2 by (b) the Cost of an RSU on the Award
Date. Any amount in respect of a fractional share shall be promptly paid to the
Participant after the Award Date. 


                    6.4
Subsequent Deferral Election. The Committee may, in its sole discretion,
permit Participants to make subsequent elections to extend the Deferral Periods
otherwise applicable to their respective RSUs. In order to be effective, a
subsequent election made by a Participant with respect to his or her RSUs: (i)
cannot take effect until at least 12 months after the date on which the
election is made; (ii) the subsequent deferral period elected by the
Participant may not be less than a five year period beginning on the date the
Deferral Period applicable to the RSUs would otherwise end; and (iii) the
election is made at least 12 months prior to the date the Deferral Period ends.
A Participant shall make his or her subsequent deferral election with respect
to his or her RSUs on the Extension of Deferral Period Form (or such other form
or agreement specified by the Committee, in its discretion). An election by a
Participant to extend the Deferral Period applicable to his or her RSUs shall
be valid solely with respect to the RSUs covered by the election. 


7






ARTICLE 7 - VESTING AND PAYMENT OF RSUS


                    7.1
Vesting. A Participant shall be fully vested in each RSU three years
after the Award Date pertaining to that RSU (provided that the Participant is
continuously employed (including any period during which the Participant is on
a leave of absence, either paid or unpaid, which is approved by the Committee,
or any other break in employment which is approved by the Committee) by the
Company or any Affiliate for such years) or, if earlier, upon death while
employed, Disability while employed or Retirement. The Committee may, in its
sole discretion, accelerate (in whole or part) the time at which any such RSUs
may be vested but in no event shall the acceleration of vesting result in the
acceleration of payment of the RSUs to the Participant. 


                    7.2
Payment on or after Vesting. With respect to each vested RSU, the
Company shall issue to the Participant one share of Common Stock upon the
earlier of: (i) the end of the Deferral Period specified in the Participant’s
Subscription Agreement pertaining to such RSU, or, if applicable, the end of
the Subsequent Deferral Period elected by the Participant for such RSU or (ii)
within 90 days following the Participant’s termination of employment with the
Company and its Affiliates. In no event shall the payment in respect of a
vested RSU be made later than two and one-half months following the later of
(i) the close of the Fiscal Year in which the RSU vests, and (ii) March 15
following the year in which the RSU vests. 


                    7.3
Payment Prior to Vesting. 


	
 

	
 

	
 

	
 


	
 

	
(a)

	
Voluntary
 Termination; Termination for Cause. If a Participant
 voluntarily terminates his or her employment with the Company and its Affiliates
 for reasons other than death or Disability or is involuntarily terminated by
 the Company or an Affiliate for Cause, the Participant’s nonvested RSUs shall
 be canceled, and he or she shall receive within 90 days following his or her
 termination of employment with the Company and its Affiliates a cash payment
 equal to the lesser of: 


	
 

	
 

	
 

	
 


	
 

	
 

	
i)

	
an amount
 equal to the number of those nonvested RSUs awarded on each Award Date
 multiplied by the respective Cost of those RSUs; or 


	
 

	
 

	
 

	
 


	
 

	
 

	
ii)

	
an amount equal
 to the number of those nonvested RSUs awarded on each Award Date multiplied
 by the Fair Market Value of a share of Common Stock on the date of the
 Participant’s termination of employment with the Company and its Affiliates. 


	
 

	
 

	
 

	
 


	
 

	
(b)

	
Involuntary
 Termination. If a Participant’s employment is
 terminated by the Company and its Affiliates for any reason other than Cause
 or by reason of death or Disability, the Participant’s nonvested RSUs shall
 be canceled and he or she shall receive payment within 90 days following his
 or her termination of employment with the Company and its Affiliates as
 described below: 





8






	
 

	
 

	
 

	
 


	
 

	
 

	
i)

	
The number
 of nonvested RSUs awarded on each Award Date shall be multiplied by a
 fraction (not to exceed 100%), the numerator of which is the number of full
 years that the Participant was employed by the Company and its Affiliates
 after that Award Date and the denominator of which is three; and the
 Participant shall receive the resulting number of such whole RSUs in shares
 of Common Stock, with any fractional RSU paid in cash. 


	
 

	
 

	
 

	
 


	
 

	
 

	
ii)

	
With respect
 to the Participant’s remaining nonvested RSUs, the Participant shall receive
 cash in an amount equal to the lesser of: (A) the number of such nonvested
 RSUs awarded on each Award Date multiplied by the respective Cost of those
 RSUs; or (B) the number of those nonvested RSUs awarded on each Award Date
 multiplied by the Fair Market Value of a share of Common Stock on the date of
 the Participant’s termination of employment with the Company and its
 Affiliates. 


	
 

	
 

	
 

	
 


	
 

	
(c)

	
Committee’s
 Discretion. The Committee shall have complete
 discretion to determine the circumstances of a Participant’s termination of
 employment with the Company and its Affiliates, including whether the same
 results from voluntary termination, Disability, Retirement, death or
 termination by the Company for or not for Cause, and the Committee’s
 determination shall be final and binding on all parties and not subject to
 review or challenge by any Participant or other person. Notwithstanding
 anything herein to the contrary, for purposes of this Plan, a Participant
 shall not experience a termination of employment (the circumstances of which
 shall be determined by the Committee) unless such termination constitutes a
 “separation from service” within the meaning of Section 409A(a)(2)(A)(i) of
 the Code and the Treasury regulations issued thereunder. 





                    7.4
Special Rules for Specified Employees. Notwithstanding anything in this
Plan to the contrary, to the extent required by Section 409A of the Code and
Treasury regulations issued thereunder, upon a termination of employment (other
than due to death) of a Specified Employee, distributions determined, in whole
or in part, to constitute “nonqualified deferred compensation” within the
meaning of Section 409A of the Code shall be delayed until six months after
such termination of employment and such distribution shall be made to the
Participant on the first business day of the seventh month following the month
in which the Participant’s termination of employment occurred. 


                    7.5
Limitation On Distributions To Covered Employees. Notwithstanding
anything in this Plan to the contrary, in the event that a Participant is a
“covered employee” (as defined in Section 162(m)(3) of the Code and any
applicable regulations or other pronouncements issued by the Internal Revenue
Service with respect thereto), or would be a covered employee if the payments
were made in accordance with his or her deferral election under this Plan, the
value of Stock and cash which may be paid under the Plan in any Plan Year that
is not “performance-based” compensation (as defined in Section 162(m)(4)(C) of
the Code), shall not exceed one million dollars ($1,000,000) less the amount of
other compensation paid to 


9






the
Participant in such Plan Year which is not “performance-based”, which amount
shall be reasonably determined by the Company at the time of the proposed
payment. Any amount which is not distributed to the Participant in a Plan Year
as a result of the limitation set forth in this Section 7.5 shall be
distributed to the Participant in the first Plan Year in which distribution of
such amount is in compliance with the foregoing limitation set forth in this
Section 7.5 and with the provisions of Section 7.4. 


ARTICLE 8 - DIVIDEND EQUIVALENT AMOUNTS


                    Whenever
dividends (other than dividends payable only in shares of Common Stock) are
paid with respect to shares of Common Stock, each Participant shall be paid an
amount in cash equal to the number of his or her vested RSUs multiplied by the
dividend value per share. Dividends (other than dividends payable only in
shares of Common Stock) shall not be credited or paid with respect to each
Participant’s nonvested RSUs. 


ARTICLE 9 - DESIGNATION OF BENEFICIARY


                    A
Participant may designate one or more Beneficiaries to receive payments or
shares of Common Stock in the event of his or her death. A designation of
Beneficiary shall apply to a specified percentage of a Participant’s entire
interest in the Plan. Such designation, or any change therein, must be in
writing in a form acceptable to the Company and shall be effective upon receipt
by the Company. If there is no effective designation of Beneficiary, or if no Beneficiary
survives the Participant, the Participant’s estate shall be deemed to be the
Beneficiary. 


ARTICLE 10 - ADJUSTMENTS


                    In
the event of a stock dividend, stock split, reverse stock split, combination or
reclassification of shares, recapitalization, merger, consolidation, exchange,
spin-off or other event which affects Common Stock, the Committee shall make
appropriate equitable adjustments in: 


	
 

	
 

	
 


	
 

	
(a)

	
the number or kind of shares of Common Stock or securities with respect to which RSUs shall thereafter be granted;


	
 

	
 

	
 


	
 

	
(b)

	
the number and kind of shares of Common Stock remaining subject to outstanding RSUs;


	
 

	
 

	
 


	
 

	
(c)

	
the number of RSUs credited to each Participant; and 


	
 

	
 

	
 


	
 

	
(d)

	
the method of determining the value of RSUs. 





10






ARTICLE 11 - AMENDMENT OR TERMINATION OF PLAN


                    The
Company reserves the right to amend, terminate or freeze the Plan at any time,
by action of its Board of Directors (or a duly authorized committee thereof )
or the Committee, provided that no such action shall adversely affect a
Participant’s rights under the Plan with respect to RSUs awarded and vested
before the date of such action, provided, further that the Company may amend the
Plan and any elections hereunder at any time to comply with applicable law
(including, without limitation, Section 409A of the Code) without a
Participant’s consent. No amendment shall be effective unless approved by the
stockholders of the Company if stockholder approval of such amendment is
required to comply with any applicable law, regulation or stock exchange rule.
Upon termination of the Plan, any vested RSUs shall be paid in accordance with
Section 7.2 of the Plan and any nonvested RSUs shall be canceled and paid in
accordance with Section 7.3(b) of the Plan; provided, however, that any such
payments shall be made on the earliest of (i) the date that is 12 months from
the date the Company takes all necessary action to irrevocably terminate and liquidate
the Plan and (ii) the date on which the RSUs would be payable under the terms
of the Plan had the action to terminate the Plan had not occurred. Upon
freezing of the Plan, all vested RSUs shall continue to be held under the Plan
until their payment or cancellation in accordance with the terms of the Plan
and all nonvested RSUs shall vest or become canceled in accordance with the
terms of the Plan. 


ARTICLE 12 - MISCELLANEOUS PROVISIONS


                    12.1
No Distribution; Compliance with Legal Requirements. The Committee may
require each person acquiring shares of Common Stock under the Plan to
represent to and agree with the Company in writing that such person is
acquiring the shares without a view to distribution thereof. No shares of
Common Stock shall be issued until all applicable securities law and other
legal and stock exchange requirements have been satisfied. The Committee may
require the placing of such stop-orders and restrictive legends on certificates
for Common Stock as it deems appropriate. 


                    12.2
Withholding. Participation in the Plan is subject to any required tax
withholding on wages or other income of the Participant in connection with the
Plan. Each Participant agrees, by entering the Plan, that the Company or the
Affiliate employing the Participant shall have the right to deduct any minimum
federal, state or local income taxes or other taxes, in its sole discretion,
from any amount payable to the Participant under the Plan or from any payment
of any kind otherwise due to the Participant. Prior to the issuance or delivery
of shares of Common Stock or the payment of any cash hereunder, a Participant
shall pay all minimum required withholding to the Company and, if applicable,
an Affiliate. Without limiting the generality of the foregoing, any withholding
obligation with regard to any Participant may be satisfied by: (i) reducing the
number of shares of Common Stock otherwise deliverable to the Participant; (ii)
subject to the Committee’s prior consent, any method approved by the Committee
which may include the Participant delivering shares of Common Stock already
owned for at least six months (or such other period to avoid an accounting
charge against the Company’s earnings) and held free and clear of all encumbrances
to the Company; or (iii) by the Participant paying cash directly to the
Company. 


11






                    12.3
Notices; Delivery of Stock Certificates. Any notice required or
permitted to be given by the Company or the Committee pursuant to the Plan shall
be deemed given when personally delivered or deposited in the United States
mail, registered or certified, postage prepaid, addressed to the Participant at
the last address shown for the Participant on the records of the Company.
Delivery of stock certificates to persons entitled to receive them under the
Plan shall be deemed effected for all purposes when the Company or a share
transfer agent of the Company shall have deposited such certificates in the
United States mail, addressed to such person at his/her last known address on
file with the Company. 


                    12.4
Nontransferability of Rights. During a Participant’s lifetime, no
payment or issuance of shares under the Plan shall be made to anyone except the
Participant otherwise than by will or the laws of descent and distribution. No
RSU Award or other interest under the Plan shall be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
garnishment, execution, levy or charge, and any attempt by a Participant or any
Beneficiary under the Plan to do so shall be void. No interest under the Plan
shall in any manner be liable for or subject to the debts, contracts,
liabilities, engagements or torts or a Participant or Beneficiary entitled
thereto. 


                    12.5
Obligations Unfunded and Unsecured. The Plan shall at all times be
entirely unfunded, and no provision shall at any time be made with respect to
segregating assets of the Company (including Common Stock) for payment of any
amounts or issuance of any shares of Common Stock hereunder. No Participant or
other person shall own any interest in any particular assets of the Company or
any Affiliate (including Common Stock) by reason of the right to receive
payment under the Plan, and any Participant or other person shall have only the
rights of a general unsecured creditor of the Company with respect to any
rights under the Plan. Nothing contained in this Plan and no action taken
pursuant to the provisions of this Plan shall create or be construed to create
a trust of any kind, or a fiduciary relationship amongst the Company, any
Affiliate, the Committee, and the Participants, their designated Beneficiaries
or any other person. Any funds which may be invested under the provisions of
this Plan shall continue for all purposes to be part of the general funds of
the Company and no person other than the Company shall by virtue of the
provisions of this Plan have any interest in such funds. If the Company decides
to establish any accrued reserve on its books against the future expense of
benefits payable hereunder, or if the Company establishes a rabbi trust under
this Plan, such reserve or trust shall not under any circumstances be deemed to
be an asset of the Plan. 


                    12.6
Governing Law. The Plan is established in order to provide deferred
compensation to a select group of management and highly compensated employees
within the meanings of Sections 201(2) and 301(a)(3) of the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”). To the extent legally
required, the Code and ERISA shall govern the Plan and, if any provision hereof
is in violation of any applicable requirement thereof, the Company reserves the
right to retroactively amend the Plan to comply therewith. To the extent not
governed by the Code and ERISA, the terms of the Plan shall be governed,
construed, administered and regulated in accordance with the laws of Delaware.
In the event any provision of this Plan shall be determined to be illegal or
invalid for any reason, the other provisions shall continue in full force and
effect as if such illegal or invalid provision had never been included herein. 


12






                    12.7
Claims Procedure. A Participant or Beneficiary shall make any claim
(and, in the case of the denial of such claim, any appeal) in writing to the
Committee or such other person designated by the Committee in accordance with
the claims procedure established by the Committee, which is intended to comply
with the claims procedure provided under ERISA and U.S. Department of Labor
Regulation § 2560.503-1. 


                    12.8
Rule 16b-3. To the extent required, the Plan is intended to comply with
Rule 16b-3 and the Committee shall interpret and administer the provisions of
the Plan in a manner consistent therewith. If a management employee is
designated by the Committee to participate hereunder, any election to receive
an award of RSUs shall be deemed approved by such Committee and shall be deemed
an exempt purchase under Rule 16b-3. Any provisions inconsistent with Rule
16b-3 shall be inoperative and shall not affect the validity of the Plan. 


                    12.9
Certain Section 409A Matters. Neither the Company and its Affiliates nor
their current employees, officers, directors, representatives or agents shall
have any liability to any current or former Participant with respect to any
accelerated taxation, additional taxes, penalties or interest for which any
current or former Participant may become liable in the event that any amounts
payable under the Plan are determined to violate Section 409A. If, at the time
installments of payments are to be made under the Plan, the entitlement to a
series of installment payments shall be treated as a series of separate
payments for purposes of Section 409A, including for purposes of the subsequent
changes of time or form of payment as provided in Treasury Regulation Section
1.409A-2(b)(2). 


                    12.10
No Employment Rights. The establishment and operation of this Plan shall
not confer any legal rights upon any Participant or other person for a
continuation of employment, nor shall it interfere with the rights of the
Company or Affiliate to discharge any employee and to treat him or her without
regard to the effect which that treatment might have upon him or her as a
Participant or potential Participant under the Plan. 


                    12.11
Severability of Provisions. If any provision of the Plan shall be held
invalid or unenforceable, such invalidity or unenforceability shall not affect
any other provisions hereof, and the Plan shall be construed and enforced as if
such provisions had not been included. 


                    12.12
Construction. The use of a masculine pronoun shall include the feminine,
and the singular form shall include the plural form, unless the context clearly
indicates otherwise. The headings and captions herein are provided for
reference and convenience only, shall not be considered part of the Plan, and
shall not be employed in the construction of the Plan. 


                    12.13
Effective Date of Plan. The Plan was originally adopted effective
January 1, 1999, subject to approval of the stockholders of the Company as
provided under applicable law, regulation or stock exchange rule and was
subsequently amended and restated effective December 18, 2002 and January 1,
2005. The Plan, as amended and restated on September 23, 2008, is set forth
herein, which amendment and restatement is effective January 1, 2005. 


13