WHO IS NOT AN EMPLOYEE.
(T)
"PARTICIPANT" MEANS A PERSON OR ENTITY TO WHOM AN AWARD IS OR HAS
BEEN MADE IN ACCORDANCE WITH THE PLAN.
(U)
"PERFORMANCE CYCLE" MEANS THE PERIOD OF TIME AS SPECIFIED IN AN
AGREEMENT OVER WHICH PERFORMANCE UNITS ARE TO BE EARNED.
(V)
"PERFORMANCE GOALS" MEANS THE PERFORMANCE GOALS ESTABLISHED BY THE
COMMITTEE IN CONNECTION WITH THE GRANT OF AN AWARD.
IN THE CASE OF SUCH GRANTS
TO "COVERED EMPLOYEES" UNDER CODE SECTION 162(M), THE PERFORMANCE GOALS SHALL BE
BASED ON SPECIFIED LEVELS OF ONE OR MORE OF THE FOLLOWING MEASURES WITH RESPECT
TO THE PERFORMANCE OF THE COMPANY OR A GROUP, UNIT, AFFILIATE OR AN INDIVIDUAL:
SPECIFIED LEVELS OF THE COMPANY'S STOCK PRICE, MARKET SHARE, SALES, REVENUE,
PREMIUMS, UNDERWRITING PROFIT, MARKET VALUE POTENTIAL, EARNINGS PER SHARE,
RETURN ON EQUITY, COSTS, CASH FLOW, DIVIDENDS PAID, OPERATING INCOME, RETURN ON
ASSETS, EXPENSE RATIOS, LOSS RATIOS OR COMBINED RATIOS.
SUCH PERFORMANCE GOALS
SHALL BE SET BY THE COMMITTEE WITHIN THE TIME PERIOD PRESCRIBED BY CODE
SECTION 162(M) AND RELATED REGULATIONS.
(W)
"PERFORMANCE UNITS" MEANS AN AWARD MADE PURSUANT TO PLAN
SECTION 11.
(X)
"PLAN" MEANS THIS RLI CORP. OMNIBUS STOCK PLAN, AS MAY BE AMENDED
AND IN EFFECT FROM TIME TO TIME.
(Y)
"RESTRICTED STOCK" MEANS STOCK GRANTED UNDER PLAN SECTION 7 SO
LONG AS SUCH STOCK REMAINS SUBJECT TO ONE OR MORE RESTRICTIONS.
(Z)
"RETIREMENT" MEANS THE RETIREMENT OF A PARTICIPANT WHEN THE
PARTICIPANT'S AGE PLUS YEARS OF SERVICE EQUAL AT LEAST 75.
(AA)
"SECTION 16" OR "SECTION 16(B)" MEANS SECTION 16 OR SECTION 16(B),
RESPECTIVELY, OF THE EXCHANGE ACT OR ANY SUCCESSOR STATUTE AND THE RULES AND
REGULATIONS PROMULGATED THEREUNDER AS IN EFFECT AND AS AMENDED FROM TIME TO
TIME.
(BB)
"SHARE" MEANS A SHARE OF STOCK.
(CC)
"STOCK" MEANS THE COMMON STOCK, PAR VALUE $1.00 PER SHARE, OF THE
COMPANY.
(DD)
"STOCK APPRECIATION RIGHT" MEANS A RIGHT, THE VALUE OF WHICH IS
DETERMINED IN RELATION TO THE APPRECIATION IN VALUE OF SHARES PURSUANT TO AN
AWARD GRANTED UNDER PLAN SECTION 10.
(EE)
"SUBSIDIARY" MEANS A "SUBSIDIARY CORPORATION," AS THAT TERM IS
DEFINED IN CODE SECTION 424(F) OR ANY SUCCESSOR PROVISION.
(FF)
"SUCCESSOR" WITH RESPECT TO A PARTICIPANT MEANS THE LEGAL
REPRESENTATIVE OF AN INCOMPETENT PARTICIPANT, AND IF THE PARTICIPANT IS
DECEASED, THE ESTATE OF THE PARTICIPANT OR THE PERSON OR PERSONS WHO MAY, BY
BEQUEST OR INHERITANCE, OR PURSUANT TO THE TERMS OF AN AWARD, ACQUIRE THE RIGHT
TO EXERCISE AN OPTION OR STOCK APPRECIATION RIGHT OR TO RECEIVE CASH AND/OR
SHARES ISSUABLE IN SATISFACTION OF AN AWARD IN THE EVENT OF THE PARTICIPANT'S
DEATH.
(GG)
"TERM" MEANS THE PERIOD DURING WHICH AN OPTION OR STOCK
APPRECIATION RIGHT MAY BE EXERCISED OR THE PERIOD DURING WHICH THE RESTRICTIONS
OR TERMS AND CONDITIONS PLACED ON RESTRICTED STOCK OR ANY OTHER AWARD ARE IN
EFFECT.
(HH)
"TRANSFEREE" MEANS ANY MEMBER OF THE PARTICIPANT'S IMMEDIATE FAMILY
(I.E., HIS OR HER CHILDREN, STEP-CHILDREN, GRANDCHILDREN AND SPOUSE) OR ONE OR
MORE TRUSTS FOR THE BENEFIT OF SUCH FAMILY