Document:

2006 LTIP

    Exhibit
      10.2

     

    Caterpillar
      Inc.

    2006
      Long-Term Incentive Plan

    (Amended
      and
      Restated through First Amendment)

     

     

    
      
        

      

    Caterpillar
      Inc.

    2006
      Long-Term Incentive Plan

    (Amended
      and Restated through First
      Amendment)

     

     

    Section
      1.

    Establishment,
      Objectives and Duration

     

    1.1.  Establishment.
      Subject to the
      approval of the stockholders of Caterpillar Inc., a Delaware corporation (the
      “Company”), the Company has established the Caterpillar Inc. 2006 Long-Term
      Incentive Plan (the “Plan”), as set forth herein. The Plan supersedes and
      replaces all prior equity and non-equity long-term incentive compensation plans
      or programs maintained by the Company; provided that, any prior plans of the
      Company shall remain in effect until all awards granted under such prior plans
      have been exercised, forfeited, canceled, expired or otherwise terminated in
      accordance with the terms of such grants.

     

    1.2.  Purpose.
      The Plan is
      intended to provide certain present and future employees and Directors
      cash-based incentives, stock-based incentives and other equity interests in
      the
      Company thereby giving them a stake in the growth and prosperity of the Company
      and encouraging the continuance of their services with the Company or its
      Subsidiaries.

     

    1.3.  Effective
      Date.
      The Plan is
      effective as of the later of (a) the date the Plan is adopted by the Board
      or
      (b) the date the Company’s stockholders approve the Plan (the “Effective Date”).
      The Plan will be deemed to be approved by the stockholders if it receives the
      affirmative vote of the holders of a majority of the shares of stock of the
      Company present or represented and entitled to vote at a meeting duly held
      in
      accordance with the applicable provisions of the Certificate of Incorporation
      or
      Bylaws of the Company.

     

    1.4.  Duration. 
      The Plan shall
      remain in effect, subject to the right of the Company’s Board of Directors to
      amend or terminate the Plan at any time pursuant to Section 16, until all Shares
      subject to the Plan shall have been purchased or granted according to the Plan’s
      provisions. However, in no event may an Award be granted under the Plan on
      or
      after the tenth anniversary of the Effective Date.
      Upon termination
      of the Plan, no Awards may be granted but Awards previously granted shall remain
      outstanding in accordance with the terms of the Plan and the applicable Award
      Document.

     

    Section
      2.

    Definitions
      and
      Construction

     

    When
      a word or
      phrase appears in the Plan with the initial letter capitalized, and the word
      or
      phrase does not commence a sentence, the word or phrase shall generally be
      given
      the meaning ascribed to it in this Section unless a clearly different meaning
      is
      required by the context. The following words and phrases shall have the
      following meanings:

     

    2.1.  “Award”
      means,
      individually or collectively, a grant under the Plan of Nonqualified Stock
      Options, Incentive Stock Options, Stock Appreciation Rights, Restricted Stock,
      Performance Shares or Performance Units.

     

    2.2.   “Award
      Document”
      means any
      agreement, contract, or other written instrument that evidences an Award granted
      to the Participant under the Plan and sets forth the terms and provisions
      applicable to such Award.

     

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    2.3.  “Award
      Gain” means (a)
      with respect to
      a given Option exercise, the product of (X) the excess of the Fair Market Value
      of a Share on the date of exercise over the Option Price times (Y) the number
      of
      shares as to which the Option was exercised at that date, and (b) with respect
      to any other settlement of an Award granted to the Participant, the Fair Market
      Value of the cash or Shares paid or payable to the Participant (regardless
      of
      any elective deferral pursuant to Section 13) less any cash or the Fair Market
      Value of any Shares or property (other than an Award that would have itself
      then
      been forfeitable hereunder and excluding any payment of tax withholding) paid
      by
      the Participant to the Company as a condition of or in connection such
      settlement.

     

    2.4.  “Board”.
      means the Board of
      Directors of the Company.

     

    2.5.   “Cause”. means,
      except as
      otherwise provided in an Award Document, a willful engaging in gross misconduct
      materially and demonstrably injurious to the Company. For this purpose,
“willful” means an act or omission in bad faith and without reasonable belief
      that such act or omission was in or not opposed to the best interests of the
      Company.

     

    2.6.   “Change
      of Control”.
      means the
      occurrence of any of the following events: (a) any person becomes the
“beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly
      or indirectly, of securities of the Company representing 15 percent or more
      of
      the combined voting power of the Company’s then outstanding common stock, unless
      the Board by resolution negates the effect of this provision in a particular
      circumstance, deeming that resolution to be in the best interests of Company
      stockholders; (b) during any period of two consecutive years, there shall cease
      to be a majority of the Board comprised of individuals who at the beginning
      of
      such period constituted the Board; (c) the stockholders of the Company approve
      a
      merger or consolidation which would result in the voting securities of the
      Company outstanding immediately prior thereto representing (either by remaining
      outstanding or by being converted into voting securities of the surviving
      entity) less than fifty percent of the combined voting power of the voting
      securities of the Company or such surviving entity outstanding immediately
      after
      such merger or consolidation; or (d) Company stockholders approve a plan of
      complete liquidation of the Company or an agreement for the sale or disposition
      by the Company of all or substantially all of its assets.

     

    2.7.  “Code”.
      means the Internal
      Revenue Code of 1986, as amended from time to time, or any successor legislation
      thereto.

     

    2.8.   “Committee”.
      means the
      Compensation Committee of the Board, appointed to administer the Plan, as
      provided in Section 3.

     

    2.9.   “Company”.
      means Caterpillar
      Inc., a Delaware corporation, and any successor to such entity as provided
      in
      Section 18.

     

    2.10.   “Director”.
      means any
      individual who is a member of the Board.

     

    2.11.   “Disability”.
      means, unless
      otherwise provided for in an employment, change of control or similar agreement
      in effect between the Participant and the Company or a Subsidiary or in an
      Award
      Document, (a) in the case of an Employee, the Employee qualifying for long-term
      disability benefits under any long-term disability program sponsored by the
      Company or Subsidiary in which the Employee participates, and (b) in the case
      of
      a Director, the inability of the Director to engage in any substantial gainful
      business activity by reason of any medically determinable physical or mental
      impairment that can be expected to result in death, or which has lasted or
      can
      be expected to last for a continuous period of not less than 12 months, as
      determined by the Committee, based upon medical evidence.

     

    2.12.   “Effective
      Date”.
      means the date
      specified in Section 1.3.

     

    2.13.   “Employee”.
      means any employee
      of the Company or any Subsidiary.

     

    2.14.   “Exchange
      Act”.
      means the
      Securities Exchange Act of 1934, as amended from time to time, or any successor
      act thereto.

     

    
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    2.15.   “Fair
      Market Value”.
      means, as of any
      given date, the fair market value of a Share on a particular date determined
      by
      such methods or procedures as may be established from time to time by the
      Committee. Unless otherwise determined by the Committee, the Fair Market Value
      of a Share as of any date shall be the mean between the high and low prices
      at
      which the Share is traded on the New York Stock Exchange for that date or,
      if no
      prices are reported for that date, the prices on the next preceding date for
      which prices were reported. Notwithstanding the foregoing, unless otherwise
      determined by the Committee, for purposes of Section 6.5(d) of the Plan, Fair
      Market Value means the actual price at which the Shares used to acquire Shares
      are sold.

     

    2.16.  “Family
      Member”
      means any (a)
      child; (b) stepchild; (c) grandchild; (d) parent; (e) stepparent; (f)
      grandparent; (g) spouse; (h) former spouse; (i) sibling; (j) niece; (k) nephew;
      (l) mother-in-law; (m) father-in-law; (n) son-in-law; (o) daughter-in-law;
      (p)
      brother-in-law; or (q) sister-in-law of the Participant (including adoptive
      relationships). Family Member also shall mean any person sharing in the
      Participant’s household (other than a tenant or an employee).

     

    2.17.  “Good
      Reason”. means,
      except as
      otherwise provided in an Award Document, the occurrence of any of the following
      circumstances (unless such circumstances are fully corrected by the Company
      before a Participant’s termination of employment):

     

        (a)  the
      Company’s
      assignment of any duties materially inconsistent with the Participant’s position
      within the Company, or which have a significant adverse alteration in the nature
      or status of the responsibilities of the Participant’s employment;
      or

     

        (b)  a
      material
      reduction by the Company in the Participant’s annual base salary, unless such
      reduction is part of a compensation reduction program affecting all similarly
      situated management employees.

     

    2.18.  “Incentive
      Stock Option”.
      or “ISO”
      means the right to
      purchase Shares pursuant terms and conditions that provide that such right
      will
      be treated as an incentive stock option within the meaning of Code Section
      422,
      as described in Section 6.

     

    2.19.  “Long
      Service Separation”
      means, except as
      otherwise provided in an Award Document, a termination of employment with the
      Company or a Subsidiary after the attainment of age 55 and the completion of
      ten
      or more years of service with the Company and/or its Subsidiaries.

     

    2.20.  “Named
      Executive Officer”.
      means a
      Participant who is one of the group of covered employees as defined in the
      regulations promulgated under Code Section 162(m), or any successor provision
      or
      statute.

     

    2.21.   “Nonqualified
      Stock Option”.
      or “NQSO”.
      means the right to
      purchase Shares pursuant to terms and conditions that provide that such right
      will not be treated as an Incentive Stock Option, as described in Section
      6.

     

    2.22.   “Option”.
      means an Incentive
      Stock Option or a Nonqualified Stock Option, as described in Section
      6.

     

    2.23.   “Option
      Price”.
      means the per
      share price of a Share available for purchase pursuant to an
      Option.

     

    2.24.   “Participant”.
      means an Employee,
      prospective Employee, Director, beneficiary or any other person who has
      outstanding an Award granted under the Plan, and includes those former Employees
      and Directors who have certain post-termination rights under the terms of an
      Award granted under the Plan.

     

    2.25.   “Performance-Based
      Exception”.
      means the
      exception for performance-based compensation from the tax deductibility
      limitations of Code Section 162(m).

     

    2.26.   “Performance
      Period”.
      means the time
      period during which performance goals must be achieved with respect to an Award,
      as determined by the Committee.

     

    
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    2.27.   “Performance
      Share”.
      means an Award
      granted to a Participant, as described in Section 9.

     

    2.28.   “Performance
      Unit”.
      means an Award
      granted to a Participant, as described in Section 9.

     

    2.29.  “Period
      of Restriction”.
      means the period
      during which the transfer of Shares of Restricted Stock is limited in some
      way,
      and the Shares are subject to a substantial risk of forfeiture, as provided
      in
      Section 8.

     

    2.30.  “Permitted
      Transferee”
      means any one or
      more of the following: (a) Family Members; (b) a trust in which the Participant
      and/or Family Members have more than fifty percent of the beneficial interest;
      (c) a foundation in which the Participant and/or Family Members control the
      management of the assets; or (d) any other entity in which the Participant
      and/or Family Members own more than fifty percent of the voting
      interests.

     

    2.31.   “Plan”.
      means the
      Caterpillar Inc. 2006 Long-Term Incentive Plan, as set forth
      herein.

     

    2.32.   “Restricted
      Stock”.
      means an Award
      granted to a Participant pursuant to Section 8.

     

    2.33.  “Section
      16 Officer”
      means any Employee
      who is considered an officer of the Company for purposes of Section 16 of the
      Exchange Act. 

     

    2.34.  “Share”
      or
“Shares”.
      means shares of
      common stock of the Company. 

     

    2.35.   “Stock
      Appreciation Right”
      or
“SAR”.
      means an Award,
      granted alone or in connection with a related Option, designated as an SAR,
      pursuant to the terms of Section 7.

     

    2.36.   “Subsidiary”. means
      any
corporation,
      partnership, joint venture, affiliate, or other entity in which the Company
      is
      at least a majority-owner of all issued and outstanding equity interests or
      has
      a controlling interest.

     

    2.37.  “Tandem
      SAR”.
      means a SAR that
      is granted in connection with a related Option pursuant to Section 7, the
      exercise of which shall require forfeiture of the right to purchase a Share
      under the related Option (and when a Share is purchased under the Option, the
      Tandem SAR shall similarly be forfeited).

     

    2.38.   “Non-Tandem
      SAR”.
      means a SAR that
      is granted independently of any Options, as described in Section 7.

     

     

    Section
      3.

    Administration

     

    3.1.  Plan
      Administration. The
      Committee, or
      any other committee appointed by the Board, shall administer the Plan. The
      Committee or other committee appointed to administer the Plan shall consist
      of
      not less than two non-Employee Directors of the Company, within the meaning
      of
      Rule 16b-3 of the Exchange Act and not less than two outside directors, within
      the meaning of Code Section 162(m). The Board may, from time to time, remove
      members from, or add members to, the Committee. Members of the Board shall
      fill
      any vacancies on the Committee. Acts of a majority of the Committee at a meeting
      at which a quorum is present, or acts reduced to or approved in writing by
      unanimous consent of the members of the Committee, shall be valid acts of the
      Committee.

    
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    3.2.  Authority
      of the Committee.
      Except as limited
      by law or by the Certificate of Incorporation or Bylaws of the Company, and
      subject to the provisions herein, the Committee shall have full power to select
      Employees, prospective Employees and Directors who shall participate in the
      Plan; determine the sizes and types of Awards; determine the terms and
      conditions of Awards in a manner consistent with the Plan; construe and
      interpret the Plan and any agreement or instrument entered into under the Plan;
      establish, amend, or waive rules and regulations for the Plan’s administration;
      and amend the terms and conditions of any outstanding Award to the extent such
      terms and conditions are within the sole discretion of the Committee as provided
      in the Plan and subject to Section 16. Further, the Committee shall make all
      other determinations, which may be necessary or advisable for the administration
      of the Plan. As permitted by law, the Committee may delegate the authority
      granted to it herein.

     

    3.3.  Electronic
      Administration.
      The Committee
      may, in its discretion, utilize a system for complete or partial electronic
      administration of the Plan and may replace any written documents described
      in
      the Plan with electronic counterparts, as appropriate.

     

    3.4.  Decisions
      Binding.
      All determinations
      and decisions made by the Committee pursuant to the provisions of the Plan
      and
      all related orders and resolutions of the Board shall be final, conclusive
      and
      binding on all persons, including the Company, its stockholders, Employees,
      Participants, and their estates and beneficiaries.

     

    Section
      4.  

    Shares
      Subject to the Plan and Maximum Awards

     

    4.1.  Shares
      Available for Awards.

     

    (a)  The
      Shares
      available for Awards may be either authorized and unissued Shares or Shares
      held
      in or acquired for the treasury of the Company. The aggregate number of Shares
      that may be issued or used for reference purposes under the Plan or with respect
      to which Awards may be granted shall not exceed twenty million (20,000,000)
      Shares, subject to adjustment as provided in Section 4.3. In addition, seventeen
      million six hundred thousand (17,600,000) Shares authorized but unissued
      pursuant to the Caterpillar Inc. 1996 Stock Option and Long-Term Incentive
      Plan
      shall be reserved and available for grant under the Plan. Notwithstanding the
      foregoing, the aggregate number of Shares with respect to which ISOs may be
      granted shall not exceed the number specified above, and provided further,
      that
      up to an aggregate of twenty percent (20%) of the authorized Shares under the
      Plan may be issued with respect to Awards of Restricted Stock and up to an
      aggregate of twenty percent (20%) of the authorized Shares under the Plan may
      be
      issued with respect to Awards of Performance Shares. 

     

    (b)  Upon:

     

                (i)  a
      payout of a
      Non-Tandem SAR or Tandem SAR in the form of cash;

     

                (ii)  a
      cancellation,
      termination, expiration, forfeiture, or lapse for any reason (with the exception
      of the termination of a Tandem SAR upon exercise of the related Options, or
      the
      termination of a related Option upon exercise of the corresponding Tandem SAR)
      of any Award; or

     

                (iii)  payment
      of an
      Option Price or payout of any Award with previously acquired Shares or by
      withholding Shares which otherwise would be acquired on exercise or issued
      upon
      such payout,

     

    the
      number of
      Shares underlying any such Award that were not issued as a result of any of
      the
      foregoing actions shall again be available for the purposes of Awards under
      the
      Plan. In addition, in the case of any Award granted in substitution for an
      award
      of a company or business acquired by the Company or a Subsidiary, Shares issued
      or issuable in connection with such substitute Award shall not be counted
      against the number of Shares reserved under the Plan, but shall be available
      under the Plan by virtue of the Company’s assumption of the plan or arrangement
      of the acquired company or business.

    
       

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    4.2.  Individual
      Participant Limitations.
      Unless and until
      the Committee determines that an Award to a Named Executive Officer shall not
      be
      designed to comply with the Performance-Based Exception, the following rules
      shall apply to grants of such Awards under the Plan:

     

    (a)  Subject
      to
      adjustment as provided in Section 4.3, the maximum aggregate number of Shares
      (including Options, SARs, Restricted Stock and Performance Shares to be paid
      out
      in Shares) that may be granted in any one fiscal year to a Participant shall
      be
      800,000 Shares.

     

    (b)  Except
      as otherwise
      provided in Section 7.5(b) regarding SAR exercise, the maximum aggregate cash
      payout (including Performance Units and Performance Shares paid out in cash)
      with respect to Awards granted in any one fiscal year that may be made to any
      Participant shall be $5 million.

     

    4.3.  Adjustments
      in Authorized Shares.
      In the event of
      any change in corporate capitalization, such as a stock split, or a corporate
      transaction, such as any merger, consolidation, separation, including a
      spin-off, or other distribution of stock or property of the Company, any
      reorganization (whether or not such reorganization comes within the definition
      of such term in Code Section 368) or any partial or complete liquidation of
      the
      Company, an adjustment shall be made in the number and class of Shares available
      for Awards, the number and class of and/or price of Shares subject to
      outstanding Awards granted under the Plan and the number of Shares set forth
      in
      Sections 4.1 and 4.2, to prevent dilution or enlargement of rights. Such
      adjustment shall be made in a manner determined by the Committee, in its sole
      discretion, to be appropriate and equitable; provided, however, that (a) no
      such
      adjustment shall cause an increase in the fair value of an Award for purposes
      of
      Statement of Financial Accounting Standards No. 123 (revised 2004) or any
      successor thereto; and (b) the number of Shares subject to any Award shall
      always be a whole number by rounding any fractional Share (up or down) to the
      nearest whole Share.

     

     

    Section
      5.

    Eligibility
      and Participation

     

    5.1.  Eligibility. 
      Persons eligible
      to participate in the Plan include all current and future Employees (including
      officers), persons who have been offered employment by the Company or a
      Subsidiary (provided that such prospective Employee may not receive any payment
      or exercise any right relating to an Award until such person begins employment
      with the Company or Subsidiary), and Directors, as determined by the
      Committee.

     

    5.2.  Participation. 
      Subject to the
      provisions of the Plan, the Committee shall determine and designate, from time
      to time, the Employees, prospective Employees, and Directors to whom Awards
      shall be granted, the terms of such Awards, and the number of Shares subject
      to
      such Award.

     

    5.3.  Foreign
      Participants.
      In order to
      assure the viability of Awards granted to Participants employed in foreign
      countries, the Committee may provide for such special terms as it may consider
      necessary or appropriate to accommodate differences in local law, tax policy,
      or
      custom. Moreover, the Committee may approve such supplements to, or amendments,
      restatements, or alternative versions of the Plan as it may consider necessary
      or appropriate for such purposes without thereby affecting the terms of the
      Plan
      as in effect for any other purpose; provided, however, that no such supplements,
      amendments, restatements, or alternative versions shall increase the share
      limitations contained in Section 4 of the Plan.

     

    
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    Section
      6.

    Stock
      Options

     

    6.1.  Grant
      of Options.

     

    (a)  Option
      Grant. Subject
      to the
      terms and provisions of the Plan, Options may be granted to one or more
      Participants in such number, upon such terms and provisions, and at any time
      and
      from time to time, as determined by the Committee, in its sole discretion.
      The
      Committee may grant either Nonqualified Stock Options or (in the case of Options
      granted to Employees) Incentive Stock Options, and shall have complete
      discretion in determining the number of Options of each granted to each
      Participant, subject to the limitations of Section 4. Each Option grant shall
      be
      evidenced by a resolution of the Committee approving the Option
      grant.

     

    (b)  Award
      Document. 
      All
      Options shall
      be evidenced by an Award Document. The Award Document shall specify the Option
      Price, the term of the Option, the number of Shares subject to the Option,
      and
      such other provisions as the Committee shall determine, and which are not
      inconsistent with the terms and provisions of the Plan. The Award Document
      shall
      also specify whether the Option is to be treated as an ISO within the meaning
      of
      Code Section 422. If such Option is not designated as an ISO, such Option shall
      be a NQSO.

     

    6.2.  Option
      Price. 
      The Committee
      shall designate the Option Price for each Share subject to an Option under
      the
      Plan, provided that such Option Price shall not be less than 100% of the Fair
      Market Value of Shares subject to an Option on the date the Option is granted,
      and which Option Price may not be subsequently changed by the Committee except
      pursuant to Section 4.3. With respect to a Participant who owns, directly or
      indirectly, more than 10% of the total combined voting power of all classes
      of
      the stock of the Company or any Subsidiary, the Option Price of Shares subject
      to an ISO shall be at least 110% of the Fair Market Value of such Shares on
      the
      ISO’s grant date.

     

    6.3.  Term
      of Options. 
      Each Option
      granted to a Participant shall expire at such time as the Committee shall
      determine at the time of grant, but in no event shall be exercisable later
      than
      the 10th anniversary of the grant date. Notwithstanding the foregoing, with
      respect to ISOs, in the case of a Participant who owns, directly or indirectly,
      more than 10% of the total combined voting power of all classes of the stock
      of
      the Company or any Subsidiary, no such ISO shall be exercisable later
      than the
      fifth anniversary of the grant date. 

     

    6.4.  Exercise
      of Options. Options
      granted
      under this Section 6 shall be exercisable at such times and be subject to such
      restrictions and conditions as the Committee shall in each instance approve,
      which need not be the same for each grant or for each Participant, and shall
      be
      set forth in the applicable Award Document. Notwithstanding the preceding
      sentence, the Fair Market Value of Shares to which ISOs are exercisable for
      the
      first time by any Participant during any calendar year (under all plans of
      the
      Company and its Subsidiaries) may not exceed $100,000. Any ISOs that become
      exercisable in excess of such amount shall be deemed NQSOs to the extent of
      such
      excess. If the Award Document does not specify the time or times at which the
      Option shall first become exercisable, such an Option shall become fully vested
      and exercisable by the Participant on the third anniversary of the grant
      date.

     

    6.5.  Payment. Options
      granted
      under this Section 6 shall be exercised by the delivery of a notice of exercise
      to the Company (or its designated agent(s)), setting forth the number of Shares
      with respect to which the Option is to be exercised, accompanied by full payment
      for the Shares. The Option Price upon exercise of any Option shall be payable
      to
      the Company in full either:

     

    (a)  in
      cash or its
      equivalent, or 

     

    (b)  by
      tendering
      previously acquired Shares having an aggregate Fair Market Value at the time
      of
      exercise equal to the total Option Price, or

     

    (c)  by
      cashless
      exercise through delivery of irrevocable instructions to a broker to promptly
      deliver to the Company the amount of proceeds from a sale of shares having
      a
      Fair Market Value equal to the purchase price.

     

    
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    6.6.  Termination
      of Employment or Service as a Director. 
      The Committee, in
      its sole discretion, shall set forth in the applicable Award Document the extent
      to which a Participant shall have the right to exercise the Option or Options
      following termination of his or her employment with the Company or any
      Subsidiary or following termination of his or her service as a Director. Such
      provisions need not be uniform among all Options issued pursuant to the Plan,
      and may reflect distinctions based on the reasons for such termination,
      including, but not limited to, termination for Cause or for Good Reason, or
      reasons relating to the breach or threatened breach of restrictive covenants.
      Subject to Section 15, in the event that a Participant’s Award Document
      does not set forth such provisions, the following provisions shall
      apply:

     

    (a)  Long
      Service Separation, Death or Disability.
      If
      a Participant’s
      employment with the Company and/or any Subsidiary or service as a Director
      terminates by reason of Long Service Separation, death or Disability, to the
      extent that the Option is not exercisable, all Shares covered by his or her
      Options shall immediately become fully vested and shall remain exercisable
      until
      the earlier of (i) the remainder of the term of the Option, or (ii) 60 months
      from the date of such termination. In the case of the Participant’s death, the
      Participant’s beneficiary or estate may exercise the Option. 

     

    (b)  Termination
      for Cause.
      If
      a Participant’s
      employment with the Company and/or any Subsidiary or service as a Director
      terminates for Cause, all Options granted to such Participant shall expire
      immediately and all rights to purchase Shares (vested or nonvested) under the
      Options shall cease upon such termination.

     

    (c)  Other
      Termination.
      If
      a Participant’s
      employment with the Company and/or any Subsidiary or service as a Director
      terminates for any reason other than Long Service Separation, death, Disability,
      or for Cause, all Options shall remain exercisable until the earlier of (i)
      the
      remainder of the term of the Option, or (ii) 60 days from the date of such
      termination. In such circumstance, the Option shall only be exercisable to
      the
      extent that it was exercisable as of such termination date and shall not be
      exercisable with respect to any additional Shares.

     

    6.7.  Restrictions
      on Shares. The
      Committee may
      impose such restrictions on any Shares acquired pursuant to the exercise of
      an
      Option granted under this Section 6 as it may deem advisable, including, without
      limitation, restrictions under applicable Federal securities laws, under the
      requirements of any stock exchange or market upon which such Shares are then
      listed and/or traded, and under any blue sky or state or foreign securities
      laws
      applicable to such Shares.

     

    6.8.  Transferability
      of Options.

     

    (a)  Incentive
      Stock Options. No
      ISO granted
      under the Plan may be sold, transferred, pledged, assigned, or otherwise
      alienated or hypothecated, other than by will or by the laws of descent and
      distribution. Further, all ISOs granted to a Participant under the Plan shall
      be
      exercisable during his or her lifetime only by such Participant.

     

    (b)  Nonqualified
      Stock Options.
      NQSOs
      may only be
      transferred in accordance with this Section 6.8(b).

     

    (i) Except
      as otherwise
      provided in paragraph (ii) below or in an Award Document, no NQSO shall be
      assignable or transferable by a Participant other than by will, by the laws
      of
      descent and distribution or pursuant to a Domestic Relations Order (as such
      term
      is defined in Section 414(p)(1)(B) of the Code).

    
       

      Page
        8

      
        

      

    

     

    (ii) NQSOs
      (whether
      vested or unvested) held by (A) Participants who are Section 16 Officers; (B)
      Participants who are Directors; or (C) any Participants who previously held
      the
      positions in clauses (A) and (B) may be transferred by gift or by domestic
      relations order to one or more Permitted Transferees. NQSOs (whether vested
      or
      unvested) held by all other Participants and by Permitted Transferees may be
      transferred by gift or by domestic relations order only to Permitted Transferees
      upon the prior written approval of the Company’s Director of Compensation +
      Benefits.

     

    
       

    

     

    Section
      7.

    Stock
      Appreciation Rights

     

    7.1.  Grant
      of SARs.

     

    (a)  SAR
      Grant.  Subject
      to the
      terms and provisions of the Plan, SARs may be granted to Participants in such
      number, upon such terms and provisions, and at any time and from time to time,
      as determined by the Committee in its sole discretion. The Committee may grant
      Non-Tandem SARs, Tandem SARs, or any combination of these forms of SARs. The
      Committee shall have complete discretion in determining the number of SARs
      granted to each Participant (subject to Section 4) and, consistent with the
      provisions of the Plan, in determining the terms and conditions pertaining
      to
      such SARs. The Committee shall designate, at the time of grant, the grant price
      of a Non-Tandem SAR, which grant price shall not be less than 100% of the Fair
      Market Value of a Share on the grant date of the SAR. The grant price of Tandem
      SARs shall equal the Option Price of the related Option. Grant prices of SARs
      shall not subsequently be changed by the Committee, except pursuant to
      Section 4.3.

     

    (b)  Award
      Document.
      All
      SARs shall be
      evidenced by an Award Document. The Award Document shall specify the grant
      price, the term of the SAR, and such other provisions as the Committee shall
      determine, and which are not inconsistent with the terms and provisions of
      the
      Plan.

     

    7.2.  Term
      of SARs. 
      The term of a SAR
      granted under the Plan shall be determined by the Committee, in its sole
      discretion; provided, however, that unless otherwise designated by the
      Committee, such term shall not exceed ten years from the grant
      date.

     

    7.3.  Exercise
      of Tandem SARs. Tandem
      SARs may be
      exercised for all or part of the Shares subject to the related Option upon
      the
      surrender of the right to exercise the equivalent portion of the related Option.
      A Tandem SAR may be exercised only with respect to the Shares for which its
      related Option is then exercisable. Notwithstanding any other provision of
      the
      Plan to the contrary, with respect to a Tandem SAR granted in connection with
      an
      ISO: (i) the Tandem SAR will expire no later than the expiration of the
      underlying ISO; (ii) the value of the payout with respect to the Tandem SAR
      may
      be for no more than 100% of the difference between the Option Price of the
      underlying ISO and the Fair Market Value of the Shares subject to the underlying
      ISO at the time the Tandem SAR is exercised; and (iii) the Tandem SAR may be
      exercised only when the Fair Market Value of the Shares subject to the ISO
      exceeds the Option Price of the ISO.

     

    7.4.  Exercise
      of Non-Tandem SARs. 
      Non-Tandem SARs
      may be exercised upon whatever terms and conditions the Committee, in its sole
      discretion, imposes upon them.

     

    7.5.  Payment
      of SAR Amount. 

     

    (a)  Upon
      exercise of a
      SAR, a Participant shall be entitled to receive payment from the Company in
      an
      amount determined by multiplying:

     

    (i)  The
      excess of the
      Fair Market Value of a Share on the date of exercise over the grant price;
      by

     

    (ii)  The
      number of
      Shares with respect to which the SAR is exercised.

     

    
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    (b)  Unless
      otherwise
      provided in the Award Document, the payment upon SAR exercise may be in cash,
      in
      Shares of equivalent value, or in some combination thereof. If, and to the
      extent that the payment upon SAR exercise is made in cash, such cash payment
      shall not be subject to the limitation of Section 4.2(b).

     

    7.6.  Termination
      of Employment or Service as a Director. The
      Committee, in
      its sole discretion, shall set forth in the applicable Award Document the extent
      to which a Participant shall have the right to exercise the SAR or SARs
      following termination of his or her employment with the Company or any
      Subsidiary or following termination of his or her service as a Director. Such
      provisions need not be uniform among all SARs issued pursuant to the Plan,
      and
      may reflect distinctions based on the reasons for such termination, including,
      but not limited to, termination for Cause or for Good Reason, or reasons
      relating to the breach or threatened breach of restrictive covenants. Subject
      to
      Section 15, in the event that a Participant’s Award Document does not set forth
      such provisions, the following provisions shall apply:

     

    (a)  Long
      Service Separation, Death or Disability.
      If
      a Participant’s
      employment with the Company and/or any Subsidiary or service as a Director
      terminates by reason of Long Service Separation, death or Disability, to the
      extent that the SARs are not exercisable, all of his or her SARs shall
      immediately become fully vested and shall remain exercisable until the earlier
      of (i) the remainder of the term of the SAR, or (ii) 60 months from the date
      of
      such termination. In the case of the Participant’s death, the Participant’s
      beneficiary or estate may exercise the SAR. 

     

    (b)  Termination
      for Cause.
      If
      a Participant’s
      employment with the Company and/or any Subsidiary or service as a Director
      terminates for Cause, all SARs shall expire immediately and all rights
      thereunder shall cease upon such termination.

     

    (c)  Other
      Termination.
      If
      a Participant’s
      employment with the Company and/or any Subsidiary or service as a Director
      terminates for any reason other than Long Service Separation, death, Disability,
      or for Cause, all SARs shall remain exerciseable until the earlier of (i) the
      remainder of the term of the SAR, or (ii) 60 days from the date of such
      termination. In such circumstance, the SAR shall only be exercisable to the
      extent it was exercisable as of such termination date and shall not be
      exercisable with respect to any additional SARs.

     

    7.7.  Transferability
      of SARs.  SARs
      may only be
      transferred in accordance with this Section 7.7.

     

    
      (a)  Except
        as otherwise
        provided in paragraph (b) below or in an Award Document, no SAR shall be
        assignable or transferable by a Participant other than by will, by the laws
        of
        descent and distribution or pursuant to a Domestic Relations Order (as such
        term
        is defined in Section 414(p)(1)(B) of the Code).

       

      (b)  SARs
        held by (i)
        Participants who are Section 16 Officers; (ii) Participants who are Directors;
        or (iii) any Participants who previously held the positions in clauses (i)
        and
        (ii) may be transferred by gift or by domestic relations order to one or
        more
        Permitted Transferees. SARs held by all other Participants and by Permitted
        Transferees may be transferred by gift or by domestic relations order to
        Permitted Transferees only upon the prior written approval of the Company’s
        Director of Compensation and Benefits.

       

      (c)  Notwithstanding
        the
        foregoing, with respect to a Tandem SAR granted in connection with an ISO,
        no
        such Tandem SAR may be sold, transferred, pledged, assigned, or otherwise
        alienated or hypothecated, other than by will or by the laws of descent and
        distribution.

       

    

    
      
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    Section
      8.

    Restricted
      Stock

     

    8.1.  Grant
      of
      Restricted Stock.

     

    (a)  Grant
      of
      Restricted Stock.
       Subject
      to the
      terms and provisions of the Plan, the Committee, at any time and from time
      to
      time, may grant Shares of Restricted Stock to Participants in such amounts
      as
      the Committee shall determine.

     

    (b)  Award
      Document.
      All
      shares of
      Restricted Stock shall be evidenced by an Award Document. The Award Document
      shall specify the Period or Periods of Restriction (consistent with the next
      sentence), the number of Shares of Restricted Stock granted, and such other
      provisions as the Committee shall determine pursuant to Section 8.3 or
      otherwise, and which shall not be inconsistent with the terms and provisions
      of
      the Plan. Shares of Restricted Stock not in excess of five percent of the number
      of shares that may be issued with respect to Awards of Restricted Stock, as
      provided in Section 4.1, may have a Period or Periods of Restriction as
      determined by the Committee in its sole discretion, and any other shares of
      Restricted Stock shall have a Period of Restriction, as determined by the
      Committee, that shall not lapse in any respect until on or after the third
      anniversary of the grant date. If no Period of Restriction is set forth in
      the
      Award Document, the transfer and any other restrictions shall lapse (i) to
      the
      extent of one-third of the Shares (rounded to the nearest whole) covered by
      the
      Restricted Stock Award on the third anniversary of the grant date, (ii) to
      the
      extent of two-thirds of the Shares (rounded to the nearest whole) covered by
      the
      Restricted Stock Award on the fourth anniversary of the grant date, and (iii)
      to
      the extent of 100% of the Shares covered by the Restricted Stock Award on the
      fifth anniversary of the grant date.

     

    8.2.  Other
      Restrictions. Subject
      to Section
      10 herein, the Committee may impose such other conditions and/or restrictions
      on
      any Shares of Restricted Stock granted pursuant to the Plan as it may deem
      advisable including without limitation, a requirement that Shares will not
      be
      issued until the end of the applicable Period of Restriction, a requirement
      that
      Participants pay a stipulated purchase price for each Share of Restricted Stock,
      restrictions based upon the achievement of specific performance goals
      (Company-wide, Subsidiary-wide, divisional, and/or individual), time-based
      restrictions on vesting, which may or may not be following the attainment of
      the
      performance goals, sales restrictions under applicable shareholder agreements
      or
      similar agreements, and/or restrictions under applicable Federal or state
      securities laws. The Company shall retain the certificates representing Shares
      of Restricted Stock in the Company’s possession until such time as all
      conditions and/or restrictions applicable to such Shares have been satisfied.
      Except as otherwise provided in this Section 8 or in any Award Document, Shares
      of Restricted Stock covered by each Restricted Stock grant made under the Plan
      shall become freely transferable by the Participant after the last day of the
      applicable Period of Restriction.

     

    8.3.  Voting
      Rights. 
      Unless otherwise
      designated by the Committee at the time of grant, Participants to whom Shares
      of
      Restricted Stock have been granted hereunder may exercise full voting rights
      with respect to those Shares during the Period of Restriction.

     

    8.4.  Dividends
      and Other Distributions. 
      Unless otherwise
      designated by the Committee at the time of grant, Participants holding Shares
      of
      Restricted Stock granted hereunder shall be credited with regular cash dividends
      paid with respect to the underlying Shares while they are so held during the
      Period of Restriction. The Committee may apply any restrictions to the dividends
      that the Committee deems appropriate. Without limiting the generality of the
      preceding sentence, if the grant or vesting of Shares of Restricted Stock
      granted to a Named Executive Officer is designed to comply with the requirements
      of the Performance-Based Exception, the Committee may apply any restrictions
      it
      deems appropriate to the payment of dividends declared with respect to such
      Shares of Restricted Stock, such that the dividends and/or the Shares of
      Restricted Stock maintain eligibility for the Performance-Based Exception.
      In
      the event that any dividend constitutes a derivative security or an equity
      security pursuant to the rules under Section 16 of the Exchange Act, such
      dividend shall be subject to a vesting period equal to the remaining vesting
      period of the Shares of Restricted Stock with respect to which the dividend
      is
      paid.

     

    
       

      
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    8.5.  Termination
      of Employment or Service as a Director. The
      Committee, in
      its sole discretion, shall set forth in the applicable Award Document the extent
      to which the Participant shall have the right to receive unvested Shares of
      Restricted Stock following termination of the Participant’s employment with the
      Company and/or its Subsidiaries or termination of service as a Director. Such
      provisions need not be uniform among all Shares of Restricted Stock issued
      pursuant to the Plan, and may reflect distinctions based on the reasons for
      termination of employment including; but not limited to, termination of
      employment for Cause or for Good Reason, or reasons relating to the breach
      or
      threatened breach of restrictive covenants; provided, however that, except
      in
      the cases of terminations connected with a Change of Control and terminations
      by
      reason of death or Disability, the vesting of Shares of Restricted Stock that
      qualify for the Performance-Based Exception and that are held by Named Executive
      Officers shall not occur before the time they otherwise would have, but for
      the
      employment termination. Subject to Section 15, in the event that a Participant’s
      Award Document does not set forth such termination provisions, the following
      termination provisions shall apply:

     

    (a)  Death
      and Disability.
      Unless
      the Award
      qualifies for the Performance-Based Exception, if a Participant’s employment
      with the Company and/or any Subsidiary or service as a Director is terminated
      due to death or Disability, all Shares of Restricted Stock of such Participant
      shall immediately become fully vested on the date of such termination and any
      restrictions shall lapse.

     

    (b)  Other
      Termination.
      If
      a Participant’s
      employment with the Company and/or any Subsidiary or service as a Director
      is
      terminated for any reason other than death or Disability all Shares of
      Restricted Stock that are unvested at the date of termination shall be forfeited
      to the Company.

     

    8.6.  Acceleration
      of Vesting.
      Notwithstanding
      anything in this Section 8 to the contrary, the Committee, in its sole
      discretion, shall have the authority to accelerate the vesting of Shares of
      Restricted Stock at any time. 

     

    8.7.  Transferability.
      Except as provided
      in this Section 8, the Shares of Restricted Stock granted herein may not be
      sold, transferred, pledged, assigned, or otherwise alienated or hypothecated,
      voluntarily or involuntarily, until the end of the applicable Period of
      Restriction established by the Committee and specified in the Award Document,
      or
      upon earlier satisfaction of any other conditions, as specified by the Committee
      in its sole discretion and set forth in the Award Document. All rights with
      respect to the Restricted Stock granted to a Participant under the Plan shall
      be
      available during his or her lifetime only to such Participant. 

     

    Section
      9.

    Performance
      Units and Performance Shares

     

    9.1.  Grant
      of
      Performance Units/Shares.

     

    (a)  Grant
      of
      Performance Unit/Shares.
       Subject
      to the
      terms of the Plan, Performance Units and/or Performance Shares may be granted
      to
      Participants in such amounts and upon such terms, and at any time and from
      time
      to time, as shall be determined by the Committee, which shall not be
      inconsistent with the terms and provisions of the Plan and shall be set forth
      in
      an Award Document.

     

    (b)  Award
      Document.
      All
      Performance
      Units and Performance Shares shall be evidenced by an Award Document. The Award
      Document shall specify the initial value of the Award, the performance goals
      and
      the Performance Period, as the Committee shall determine, and which are not
      inconsistent with the terms and provisions of the Plan.

     

    
      
        Page
          12

        
          

        

      

    

     

    9.2.  Value
      of
      Performance Units/Shares.  Each
      Performance
      Unit shall have an initial value (which may be $0) that is established by the
      Committee at the time of grant. Each Performance Share shall have an initial
      value equal to the Fair Market Value of a Share on the grant date. The Committee
      shall set performance goals in its sole discretion which, depending on the
      extent to which they are met will determine the number and/or value of
      Performance Units and/or Performance Shares that will be paid out to the
      Participant. For purposes of this Section 9, the time period during which the
      performance goals must be met shall be called a Performance Period. Performance
      Shares not in excess of five percent of the number of shares that may be issued
      with respect to Awards of Performance Shares, as provided in Section 4.1, may
      have a Performance Period as determined by the Committee in its sole discretion,
      and any other Performance Shares shall have a Performance Period, as determined
      by the Committee, of not less than one year.

     

    9.3.  Earning
      of Performance Units/Shares. 
      Subject to the
      terms of the Plan, after the applicable Performance Period has ended, the holder
      of Performance Units and/or Performance Shares shall be entitled to receive
      payout on the number and value of Performance Units and/or Performance Shares
      earned by the Participant over the Performance Period, to be determined as
      a
      function of the extent to which the corresponding performance goals have been
      achieved, as established by the Committee.

     

    9.4.  Form
      and
      Timing of Payment of Performance Units/Shares. 
      Except as provided
      below, payment of earned Performance Units and/or Performance Shares shall
      be
      made in a single lump sum as soon as reasonably practicable following the close
      of the applicable Performance Period. Subject to the terms of the Plan, the
      Committee, in its sole discretion, may pay earned Performance Units and/or
      Performance Shares in the form of cash or in Shares (or in a combination
      thereof) which have an aggregate Fair Market Value equal to the value of the
      earned Performance Units and/or Performance Shares at the close of the
      applicable Performance Period. Such Shares may be granted subject to any
      restrictions deemed appropriate by the Committee.
      At the sole
      discretion of the Committee, Participants may be entitled to receive any
      dividends declared with respect to Shares which have been earned in connection
      with grants of Performance Units and/or Performance Shares which have been
      earned, but not yet distributed to Participants.

     

    9.5.  Termination
      of Employment or Service as a Director. The
      Committee, in
      its sole discretion, shall set forth in the applicable Award Document the extent
      to which the Participant shall have the right to receive payment for Performance
      Units and/or Performance Shares following termination of the Participant’s
      employment with the Company and/or its Subsidiaries or termination of service
      as
      a Director. Such provisions need not be uniform among all Performance Units
      and/or Performance Shares granted pursuant to the Plan, and may reflect
      distinctions based on the reasons for such termination including; but not
      limited to, termination for Cause or for Good Reason, or reasons relating to
      the
      breach or threatened breach of restrictive covenants. Subject to Section 15,
      in
      the event that a Participant’s Award Document does not set forth such
      termination provisions, the following termination provisions shall
      apply:

     

    (a)  Long
      Service Separation, Death or Disability.
      Subject
      to Section
      15, if a Participant’s employment with the Company and/or any Subsidiary or
      service as a Director is terminated during a Performance Period due to Long
      Service Termination, death or Disability, the Participant shall receive a
      prorated payout of the Performance Units and/or Performance Shares, unless
      the
      Committee determines otherwise. The prorated payout shall be determined by
      the
      Committee, shall be based upon the length of time that the Participant held
      the
      Performance Units and/or Performance Shares during the Performance Period,
      and
      shall further be adjusted based on the achievement of the preestablished
      performance goals. Unless the Committee determines otherwise in the event of
      a
      termination due to death, Disability or Long Service Separation, payment of
      earned Performance Units and/or Performance Shares shall be made at the same
      time as payments are made to Participants who did not terminate employment
      during the applicable Performance Period.

     

    (b)  Other
      Termination.
      If
      a Participant’s
      employment with the Company and/or any Subsidiary or service as a Director
      is
      terminated during a Performance Period for any reason other than Long Service
      Termination, death or Disability all Performance Units and/or Performance Shares
      shall be forfeited by the Participant to the Company.

     

    
      
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    9.6.  Nontransferability. 
      Except as
      otherwise provided in a Participant’s Award Document, Performance Units and/or
      Performance Shares may not be sold, transferred, pledged, assigned, or otherwise
      alienated or hypothecated, other than by will or by the laws of descent and
      distribution. Further, except as otherwise provided in a Participant’s Award
      Document, a Participant’s rights under the Plan shall be exercisable during the
      Participant’s lifetime only by the Participant or the Participant’s legal
      representative. 

     

    Section
      10.

    Performance
      Measures

     

    10.1.  Performance
      Measures.
      Unless and until
      the Committee proposes for stockholder vote and stockholders approve a change
      in
      the general performance measures set forth in this Section 10, the attainment
      of
      which may determine the degree of payout and/or vesting with respect to Awards
      to Named Executive Officers that are designed to qualify for the
      Performance-Based Exception, the performance goals to be used for purposes
      of
      such grants shall be established by the Committee in writing and stated in
      terms
      of the attainment of specified levels of or percentage changes in any one or
      more of the following measurements: (a) revenue; (b) primary or fully-diluted
      earnings per Share; (c) earnings before interest, taxes, depreciation, and/or
      amortization; (d) pretax income; (d) cash flow from operations; (e) total cash
      flow; (f) return on equity; (g) return on invested capital; (h) return on
      assets; (i) net operating profits after taxes; (j) economic value added; (k)
      total stockholder return; (l) return on sales; or (m) any individual performance
      objective which is measured solely in terms of quantifiable targets related
      to
      the Company or the Company’s business; or any combination thereof. In addition,
      such performance goals may be based in whole or in part upon the performance
      of
      the Company, a Subsidiary, division and/or other operational unit under one
      or
      more of such measures.

     

    10.2.  Performance
      Procedures.
      The degree of
      payout and/or vesting of such Awards designed to qualify for the
      Performance-Based Exception shall be determined based upon the written
      certification of the Committee as to the extent to which the performance goals
      and any other material terms and conditions precedent to such payment and/or
      vesting have been satisfied. The Committee shall have the sole discretion to
      adjust the determinations of the degree of attainment of the preestablished
      performance goals; provided, however, that the performance goals applicable
      to
      Awards which are designed to qualify for the Performance-Based Exception, and
      which are held by Named Executive Officers, may not be adjusted so as to
      increase the payment under the Award (the Committee shall retain the sole
      discretion to adjust such performance goals upward, or to otherwise reduce
      the
      amount of the payment and/or vesting of the Award relative to the
      pre-established performance goals). In the event that applicable tax and/or
      securities laws change to permit Committee sole discretion to alter the
      governing performance measures without obtaining stockholder approval of such
      changes, the Committee shall have sole discretion to make such changes without
      obtaining stockholder approval. In addition, in the event that the Committee
      determines that it is advisable to grant Awards which shall not qualify for
      the
      Performance-Based Exception, the Committee may make such grants without
      satisfying the requirements of Code Section 162(m) and, thus, which use
      performance measures other than those specified above.

     

    Section
      11.

    Award
      Forfeitures

     

    11.1.  Forfeiture
      of Options and Other Awards. 
      Each Award granted
      hereunder shall be subject to the following additional forfeiture conditions,
      to
      which the Participant, by accepting an Award hereunder, agrees. If any of the
      events specified in Section 11.2 occurs (a “Forfeiture Event”), all of the
      following forfeitures will result:

     

    (a)  The
      unexercised
      portion of any Option, whether or not vested, and any other Award not then
      settled (except for an Award that has not been settled solely due to an elective
      deferral pursuant to Section 13 by the Participant and otherwise is not
      forfeitable in the event of any termination of service of the Participant)
      will
      be immediately forfeited and canceled upon the occurrence of the Forfeiture
      Event; and

     

    
       

      
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    (b)  The
      Participant
      will be obligated to repay to the Company, in cash, within five business days
      after demand is made therefor by the Company, the total amount of Award Gain
      (as
      defined herein) realized by the Participant upon each exercise of an Option
      or
      settlement of an Award (regardless of any elective deferral pursuant to Section
      13) that occurred on or after (i) the date that is six months before the
      occurrence of the Forfeiture Event, if the Forfeiture Event occurred while
      the
      Participant was employed by the Company or a Subsidiary, or (ii) the date that
      is six months before the date the Participant’s employment by, or service as a
      Director with the Company or a Subsidiary terminated, if the Forfeiture Event
      occurred after the Participant ceased to be so employed. 

     

    11.2.  Events
      Triggering Forfeiture. The
      forfeitures
      specified in Section 11.1 will be triggered upon the occurrence of any one
      of
      the following Forfeiture Events at any time during the Participant’s employment
      by or service as a Director with the Company or a Subsidiary or during the
      one-year period following termination of such employment or
      service:

     

    (a)  Non-Solicitation.
      The
      Participant,
      for his or her own benefit or for the benefit of any other person, company
      or
      entity, directly or indirectly, (i) induces or attempts to induce or hires
      or
      otherwise counsels, induces or attempts to induce or hire or otherwise counsel,
      advise, encourage or solicit any person to leave the employment of or the
      service for the Company or any Subsidiary, (ii) hires or in any manner employs
      or retains the services of any individual employed by or providing services
      to
      the Company or any Subsidiary as of the date of his or her termination of
      employment, or employed by or providing services to the Company or any
      Subsidiary subsequent to such termination, (iii) solicits, pursues, calls upon
      or takes away, any of the customers of the Company or any Subsidiary, (iv)
      solicits, pursues, calls upon or takes away, any potential customer of the
      Company or any Subsidiary that has been the subject of a bid, offer or proposal
      by the Company or any Subsidiary, or of substantial preparation with a view
      to
      making such a bid, proposal or offer, within six months before such
      Participant’s termination of employment with the Company or any Subsidiary, or
      (v) otherwise interferes with the business or accounts of the Company or any
      Subsidiary.

     

    (b)  Confidential
      Information.
      The
      Participant
      discloses to any person or entity or makes use of any “confidential or
      proprietary information” (as defined below in this subparagraph (b)) for his or
      her own purpose or for the benefit of any person or entity, except as may be
      necessary in the ordinary course of employment with or other service to the
      Company or any Subsidiary. Such “confidential or proprietary information” of the
      Company or any Subsidiary, includes, but is not limited to, the design,
      development, operation, building or manufacturing of products manufactured
      and
      supplied by the Company and its Subsidiaries, the identity of the Company’s or
      any Subsidiary’s customers, the identity of representatives of customers with
      whom the Company or any Subsidiary has dealt, the kinds of services provided
      by
      the Company or any Subsidiary to customers and offered to be performed for
      potential customers, the manner in which such services are performed or offered
      to be performed, the service needs of actual or prospective customers, pricing
      information, information concerning the creation, acquisition or disposition
      of
      products and services, customer maintenance listings, computer software and
      hardware applications
      and
      other programs, personnel information, information identifying, relating to
      or
      concerning investors in the Company or any Subsidiary, joint venture partners
      of
      the Company or any Subsidiary, business partners of the Company or any
      Subsidiary or other entities providing financing to the Company or any
      Subsidiary, real estate and leasing opportunities, communications and
      telecommunications operations and processes, zoning and licensing matters,
      relationships with, or matters involving, landlords and/or property owners,
      and
      other trade secrets.

     

    11.3.  Agreement
      Does Not Prohibit Competition or Other Participant
      Activities.
      Although the
      conditions set forth in this Section 11 shall be deemed to be incorporated
      into
      an Award, the Plan does not thereby prohibit the Participant from engaging
      in
      any activity, including but not limited to competition with the Company and
      its
      Subsidiaries. Rather, the non-occurrence of the Forfeiture Events set forth
      in
      Section 11.2 is a condition to the Participant’s right to realize and retain
      value from his or her compensatory Awards, and the consequence under the Plan
      if
      the Participant engages in an activity giving rise to any such Forfeiture Event
      are the forfeitures specified herein. This provision shall not preclude the
      Company and the Participant from entering into other written agreements
      concerning the subject matter of Sections 11.1 and 11.2 and, to the extent
      any terms of this Section 11 are inconsistent with any express terms of such
      agreement, this Section 11 shall not be deemed to modify or amend such
      terms.

     

    
      
        Page
          15

        
          

        

      

    

     

    11.4.  Committee
      Discretion. 
      The Committee may,
      in its sole discretion, waive in whole or in part the Company’s right to
      forfeiture under this Section 11, but no such waiver shall be effective unless
      evidenced by a writing signed by a duly authorized officer of the Company.
      In
      addition, the Committee may impose additional conditions on Awards, by inclusion
      of appropriate provisions in the Award Document.
      Nothing contained
      herein shall require the Committee to enforce the forfeiture provisions of
      this
      Section 11. Failure to enforce these forfeiture provisions against any
      individual shall not be construed as a waiver of the Company’s right to
      forfeiture under this Section 11.

     

    Section
      12.

    Beneficiary
      Designation

     

    12.1.  Beneficiary
      Designations.
      Each Participant
      under the Plan may, from time to time, name any beneficiary or beneficiaries
      (who may be named contingently or successively) to whom any benefit under the
      Plan is to be paid in case of his or her death before he or she receives any
      or
      all of such benefit. Each such designation shall revoke all prior designations
      by the same Participant, shall be in a form prescribed by the Company, and
      will
      be effective only when filed by the Participant in writing with the Company
      during the Participant’s lifetime. In the absence of any such designation,
      benefits remaining unpaid at the Participant’s death shall be paid to the
      Participant’s estate.

     

    Section
      13.

    Deferrals

     

    13.1.  Deferrals.
      The Committee may
      permit a Participant to defer such Participant’s receipt of the payment of cash
      or the delivery of Shares that would otherwise be due to such Participant upon
      the exercise of any Option or by virtue of the lapse or waiver of restrictions
      with respect to Restricted Stock, or the satisfaction of any requirements or
      goals with respect to Performance Units/Shares. If any such deferral election
      is
      required or permitted, the Committee shall, in its sole discretion, establish
      rules and procedures for such payment deferrals. All such deferrals (and rules
      and procedures) shall be consistent with Code Section 409A and any other
      applicable law.

     

    Section
      14.

    Rights
      and
      Obligations of Parties

     

    14.1.  No
      Guarantee of Employment or Service Rights. 
      Nothing in the
      Plan shall interfere with or limit in any way the right of the Company to
      terminate any Participant’s employment at any time, nor confer upon any
      Participant any right to continue in the employ of the Company or any
      Subsidiary. 

     

    14.2.  Temporary
      Absence.
      For purposes of
      the Plan, temporary absence from employment because of illness, vacation,
      approved leaves of absence, and transfers of employment among the Company and
      its Subsidiaries, shall not be considered to terminate employment or to
      interrupt continuous employment.

     

    14.3.  Participation. No
      Employee or
      Director shall have the right to be selected to receive an Award under the
      Plan,
      or, having been so selected, to be selected to receive a future
      Award.

     

    14.4.  Right
      of
      Setoff. 
      The Company or any
      Subsidiary may, to the extent permitted by applicable law, deduct from and
      set
      off against any amounts the Company or Subsidiary may owe to the Participant
      from time to time, including amounts payable in connection with any Award,
      owed
      as wages, fringe benefits, or other compensation owed to the Participant, such
      amounts as may be owed by the Participant to the Company, although the
      Participant shall remain liable for any part of the Participant’s payment
      obligation not satisfied through such deduction and setoff. By accepting any
      Award granted hereunder, the Participant agrees to any deduction or setoff
      under
      this Section 14. 

     

    
      
        Page
          16

        
          

        

      

    

     

    14.5.  Section
      83(b) Election. 
      No election
      under
      Section 83(b) of the Code (to include in gross income in the year of transfer
      the amounts specified in Code Section 83(b)) or under a similar provision of
      the
      laws of a jurisdiction outside the United States may be made, unless expressly
      permitted by the terms of the Award Document or by action of the Committee
      in
      writing before the making of such election. In any case in which a Participant
      is permitted to make such an election in connection with an Award, the
      Participant shall notify the Company of such election within ten days of filing
      notice of the election with the Internal Revenue Service or other governmental
      authority, in addition to any filing and notification required pursuant to
      regulations issued under Code Section 83(b) or other applicable
      provision.

     

    14.6.  Disqualifying
      Disposition Notification. 
      If any Participant
      shall make any disposition of Shares delivered pursuant to the exercise of
      an
      Incentive Stock Option under the circumstances described in Code Section 421(b)
      (relating to certain disqualifying dispositions), such Participant shall notify
      the Company of such disposition within ten days thereof.

     

    Section
      15.

    Change
      of
      Control

     

    15.1.  Change
      of Control.
      If a
      Participant’s employment or service with the Company and/or any Subsidiary
      terminates either without Cause or for Good Reason within the 12 month period
      following a Change of Control, unless otherwise specifically prohibited under
      applicable laws, or by the rules and regulations of any governing governmental
      agencies or national securities exchanges:

     

    (a)  Any
      and all Options
      and SARs granted hereunder shall become immediately exercisable, and shall
      remain exercisable throughout their entire term;

     

    (b)  Any
      Period of
      Restriction and other restrictions imposed on Restricted Stock shall lapse;
      and

     

    (c)  Unless
      otherwise
      specified in an Award Document, the maximum payout opportunities attainable
      under all outstanding Awards of Performance Units and Performance Shares shall
      be deemed to have been fully earned for the entire Performance Period(s) as
      of
      the effective date of the Change of Control. The vesting of all such Awards
      shall be accelerated as of the effective date of the Change of Control, and
      in
      full settlement of such Awards, there shall be paid out in cash to Participants
      within 30 days following the effective date of the Change of Control the maximum
      of payout opportunities associated with such outstanding Awards.

     

    Section
      16.

    Amendment,
      Modification, and Termination

     

    16.1.  Amendment,
      Modification, and Termination. 
      The Board may
      amend, suspend or terminate the Plan or the Committee’s authority to grant
      Awards under the Plan without the consent of stockholders or Participants;
      provided, however, that any amendment to the Plan shall be submitted to the
      Company’s stockholders for approval not later than the earliest annual meeting
      for which the record date is after the date of such Board action if such
      stockholder approval is required by any federal or state law or regulation
      or
      the rules of any stock exchange or automated quotation system on which the
      Shares may then be listed or quoted and the Board may otherwise, in its sole
      discretion, determine to submit other amendments to the Plan to stockholders
      for
      approval; and provided further, that, without the written consent of an affected
      Participant, no such Board action may materially and adversely affect the rights
      of such Participant under any outstanding Award. The Committee shall have no
      authority to waive or modify any other Award term after the Award has been
      granted to the extent that the waived or modified term was mandatory under
      the
      Plan.

     

    
       

      
        Page
          17

        
          

        

      

    

     

    Section
      17.

    Withholding

     

    17.1.  Tax
      Withholding. 
      The Company shall
      have the power and the right to deduct or withhold, or require a Participant
      to
      remit to the Company, an amount sufficient to satisfy Federal, state, and local
      taxes, domestic or foreign, required by law or regulation to be withheld with
      respect to any taxable event arising as a result of the Plan.

     

    17.2.  Share
      Withholding. 
      With respect to
      withholding required upon the exercise of Options or SARs, upon the lapse of
      restrictions on Restricted Stock, or upon any other taxable event arising as
      a
      result of Awards granted hereunder, the withholding requirement shall be
      satisfied by the Company withholding Shares having a Fair Market Value on the
      date the tax is to be determined equal to the minimum statutory total tax which
      would be imposed on the transaction.

     

    Section
      18.

    Miscellaneous

     

    18.1.  Unfunded
      Plan. 
      The Plan is
      intended to constitute an “unfunded” plan for incentive and deferred
      compensation. With respect to any payments not yet made to a Participant or
      obligation to deliver Shares pursuant to an Award, nothing contained in the
      Plan
      or any Award shall give any such Participant any rights that are greater than
      those of a general creditor of the Company; provided that the Committee may
      authorize the creation of trusts and deposit therein cash, Shares, other Awards
      or other property, or make other arrangements to meet the Company’s obligations
      under the Plan. Such trusts or other arrangements shall be consistent with
      the
“unfunded” status of the Plan unless the Committee otherwise determines with the
      consent of each affected Participant.
      No such funding
      shall be established that would cause an amount to be taxable under Code Section
      409A before it is received by a Participant or cause an amount to be subject
      to
      additional tax under such Section.

     

    18.2.  Forfeitures;
      Fractional Shares.
      Unless otherwise
      determined by the Committee, in the event of a forfeiture of an Award with
      respect to which a Participant paid cash consideration, the Participant shall
      be
      repaid the amount of such cash consideration. No fractional Shares shall be
      issued or delivered pursuant to the Plan or any Award. The Committee shall
      determine whether cash, other Awards or other property shall be issued or paid
      in lieu of such fractional Shares or whether such fractional Shares or any
      rights thereto shall be forfeited or otherwise eliminated.

     

    18.3.  Compliance
      with Code Section 162(m). 
      The Company
      intends that Options and SARs granted to Named Executive Officers and other
      Awards designated as Awards to Named Executive Officers shall constitute
      qualified “performance-based compensation” within the meaning of Code Section
      162(m) and regulations thereunder, unless otherwise determined by the Committee
      at the time of allocation of an Award. Accordingly, the terms of Sections 4.2,
      6, 7, 8.5, 8.6, 9 and 10, including the definitions of Named Executive Officer
      and other terms used therein, shall be interpreted in a manner consistent with
      Code Section 162(m) and regulations thereunder. The foregoing notwithstanding,
      because the Committee cannot determine with certainty whether a given
      Participant will be a Named Executive Officer with respect to a fiscal year
      that
      has not yet been completed, the Committee may, in its discretion, extend the
      terms of such Sections to any Participant that the Committee deems appropriate.
      If any provision of the Plan or any Award Document relating to a Performance
      Award that is designated as intended to comply with Code Section 162(m) does
      not
      comply or is inconsistent with the requirements of Code Section 162(m) or
      regulations thereunder, such provision shall be construed or deemed amended
      to
      the extent necessary to conform to such requirements, and no provision shall
      be
      deemed to confer upon the Committee or any other person sole discretion to
      increase the amount of compensation otherwise payable in connection with any
      such Award upon attainment of the applicable performance
      objectives.

     

    18.4.  Gender
      and Number; Headings. 
      Except where
      otherwise indicated by the context, any masculine term used herein also shall
      include the feminine; the plural shall include the singular and the singular
      shall include the plural. Headings are included for the convenience of reference
      only and shall not be used in the interpretation or construction of any such
      provision contained in the Plan. 

     

    
      
        Page
          18

        
          

        

      

    

     

    18.5.  Severability. 
      In the event any
      provision of the Plan shall be held illegal or invalid for any reason, the
      illegality or invalidity shall not affect the remaining parts of the Plan,
      and
      the Plan shall be construed and enforced as if the illegal or invalid provision
      had not been included.

     

    18.6.  Successors.
      All obligations
      of the Company under the Plan with respect to Awards granted hereunder shall
      be
      binding on any successor to the Company, whether the existence of such successor
      is the result of a direct or indirect merger, consolidation, purchase of all
      or
      substantially all of the business and/or assets of the Company or
      otherwise.

     

    18.7.  Requirements
      of Law. 
      The granting of
      Awards and the issuance of Shares under the Plan shall be subject to all
      applicable laws, rules, and regulations, and to such approvals by any
      governmental agencies or national securities exchanges as may be
      required.

     

    18.8.  Securities
      Law Compliance. With
      respect to
“insiders,” transactions under the Plan are intended to comply with all
      applicable conditions of Rule 16b-3 or its successors under the Exchange Act.
      To
      the extent any provision of the Plan or action by the Committee fails to so
      comply, it shall be deemed null and void, to the extent permitted by law and
      deemed advisable by the Committee. An “insider” includes any individual who is,
      on the relevant date, an officer, Director or more than 10% beneficial owner
      of
      any class of the Company’s equity securities that is registered pursuant to
      Section 12 of the Exchange Act, all as defined under Section 16 of the Exchange
      Act.

     

    18.9.  Governing
      Law. To
      the extent not
      preempted by Federal law, the Plan, and all agreements hereunder, shall be
      construed in accordance with and governed by the laws of the State of Illinois
      without regard to the conflict of law provisions thereof.

     

    
       

      
        Page
          19Ex. 10.6 - DDCP

    Exhibit
      10.6

     

    CATERPILLAR
      INC.

    DIRECTORS’
      DEFERRED COMPENSATION PLAN

     

    (Amended
      and
      Restated as of January 1, 2005)

     

     

    
      
        

      

    CATERPILLAR
      INC.

    DIRECTORS’
      DEFERRED COMPENSATION PLAN

    (Amended
      and
      Restated as of January 1, 2005)

     

    PREAMBLE

    Previously,
      Caterpillar Inc. (the “Company”) adopted the Caterpillar Inc. Directors’
Deferred Compensation Plan (the “Plan”) to provide members of its Board of
      Directors with an opportunity to defer the payment of compensation. The Plan
      has
      been amended and/or restated on a number of occasions with the most recent
      amendment and restatement being effective as of April 12, 1999. By execution
      of
      this document, the Company amends and restates the Plan effective as of January
      1, 2005 to comply with the requirements of Section 409A of the Internal Revenue
      Code of 1986, as amended.

     

    ARTICLE
      I

    DEFINITIONS

     

    1.1  General.
      When a word or
      phrase appears in the Plan with the initial letter capitalized, and the word
      or
      phrase does not begin a sentence, the word or phrase shall generally be a term
      defined in this Article I. The following words and phrases used in the Plan
      with the initial letter capitalized shall have the meanings set forth in this
      Article I, unless a clearly different meaning is required by the context in
      which the word or phrase is used or the word or phrase is defined for a limited
      purpose elsewhere in the Plan document:

     

        (a)  “Board”
      means the Board of
      Directors of the Company, or any authorized committee of the Board.

     

        (b)  “C+B
      Officer”
means
      the
      Company’s Director of Compensation + Benefits.

     

        (c)  “Code”
      means the Internal
      Revenue Code of 1986, as amended from time to time, and any regulations
      promulgated thereunder.

     

        (d)  “Company”
      means Caterpillar
      Inc., and, to the extent provided in Section 9.7 (Successors)
      below, any
      successor corporation or other entity resulting from a merger or consolidation
      into or with the Company or a transfer or sale of substantially all of the
      assets of the Company.

     

        (e)  “Company
      Share Equivalent Account”
      means the
      hypothetical investment fund described in Section 5.4 (Special
      Company
      Share Equivalent Account Provisions).

     

        (f)  “Company
      Stock”
      means common stock
      issued by the Company.

     

        (g)  “Compensation”
      means the cash
      remuneration payable from time to time to a Director for services as a Director.
      Compensation shall include such remuneration attributable to annual fees, fees
      payable for attendance at meetings and fees payable for other services performed
      for or on behalf of the Company. Compensation shall not include expense
      reimbursements. Compensation also shall not include equity and equity-equivalent
      grants or gains realized on the sale of shares, the exercise or other
      disposition of options, or similar transactions related to equity equivalents.
      

     

    Page
      1

    
      
 

        (h)  “Deferral
      Account”
means
      the
      bookkeeping account maintained under the Plan to record amounts deferred under
      Section 3.3 (Deferrals).

     

        (i)  “Deferral
      Agreement”
      means the deferral
      agreement(s) described in Section 3.1 (Deferral
      Agreement)
      that are entered
      into by a Participant pursuant to the Plan.

     

        (j)  “Deferrals”
      means the
      deferrals made by a Participant in accordance with Section 3.3 (Deferrals).

     

        (k)  “Director”
      means a member of
      the Board.

     

        (l)  “Disability”
      or “Disabled”
      means that a
      Participant (1) is unable to engage in any substantial gainful activity 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 12 months, or (2) 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 12 months, receiving
      income replacement benefits for a period of not less than three months under
      an
      accident and health plan covering employees of the Participant’s
      employer.

     

        (m)  “Distribution
      Election Form”
means
      the
      election form by which a Participant elects the manner in which his accounts
      shall be distributed pursuant to Section 6.3 (Form
      of
      Distribution).

     

        (n)  “Effective
      Date”
      means January 1,
      2005.

     

        (o)  “Interest
      Fund”
      means the
      hypothetical investment fund described in Section 5.3 (Special Interest Fund
      Provisions).

     

        (p)  “Investment
      Funds”
      means the Interest
      Fund and the Caterpillar Share Equivalent Account.

     

        (q)  “Key
      Employee”
      means a “key
      employee” as defined in Section 416(i) of the Code without regard to
      Section 416(i)(5).

     

        (r)  “Participant”
      means a Director
      who affirmatively elects to participate in the Plan pursuant to Section 2.1
      (Eligibility).

     

        (s)  “Plan”
      means the
      Caterpillar Inc. Directors’ Deferred Compensation Plan, as set forth
      herein.

     

        (t)  “Plan
      Administrator”
      means
      the C+B
      Officer. The Plan Administrator may delegate his authority hereunder in his
      sole
      and absolute discretion.

     

        (u)  “Plan
      Year”
      means the calendar
      year.

     

        (v)  “Separation
      from Service”
      means
      separation
      from service as determined in accordance with any regulations, rulings or other
      guidance issued by the Department of the Treasury pursuant to Section
      409A(a)(2)(A)(i) of the Code, as it may be amended or replaced from time to
      time.

     

    
      Page
        2

      
        

      

    

     

        (w)  “Unforeseeable
      Emergency”
      means a severe
      financial hardship to the Participant resulting from an illness or accident
      of
      the Participant, the Participant’s spouse, or a dependent (as defined in section
      152(a) of the Code) of the Participant, loss of the Participant’s property due
      to casualty, or other similar extraordinary and unforeseeable circumstances
      arising as a result of events beyond the control of the Participant. For
      purposes of the Plan, an “Unforeseeable Emergency” shall not include a
      Participant’s need to send his or her child to college or a Participant’s desire
      to purchase a home.

     

        (x)  “Valuation
      Date”
      means,
      except as
      otherwise provided herein, the last day of each month of the Plan
      Year.

     

    1.2  Construction.
      The
      masculine
      gender, when appearing in the Plan, shall include the feminine gender (and
      vice
      versa), and the singular shall include the plural, unless the Plan clearly
      states to the contrary. Headings and subheadings are for the purpose of
      reference only and are not to be considered in the construction of the Plan.
      If
      any provision of the Plan is determined to be for any reason invalid or
      unenforceable, the remaining provisions shall continue in full force and effect.
      All of the provisions of the Plan shall be construed and enforced according
      to
      the laws of the State of Illinois and shall be administered according to the
      laws of such state, except as otherwise required by ERISA, the Code, or other
      Federal law.

     

    ARTICLE
      II

    ELIGIBILITY

    2.1  Eligibility.
      Any Director who
      is not an Employee of the Company or any of its affiliates is eligible to
      participate in the Plan. An eligible Director shall elect to participate in
      the
      Plan by completing a Deferral Agreement as provided in Section 3.1 (Deferral
      Agreement).

     

    ARTICLE
      III

    DEFERRALS

     

    3.1  Deferral
      Agreement.
      In order to make
      Deferrals, a Participant must complete a Deferral Agreement in the form
      prescribed by the Plan Administrator. In the Deferral Agreement, the Participant
      shall agree to reduce his Compensation in exchange for Deferrals. The Deferral
      Agreement shall be delivered to the Plan Administrator (or his designee) by
      the
      time specified in Section 3.2 (Timing
      of
      Deferral Elections).
      An election made
      by a Participant pursuant to a Deferral Agreement shall be irrevocable with
      respect to the Plan Year covered by the election. Notwithstanding the foregoing,
      the Plan Administrator may permit a Participant to revoke an election if the
      Participant has experienced an Unforeseeable Emergency, but only to the extent
      that revoking the election would help the Participant meet the related emergency
      need.

     

    3.2  Timing
      of Deferral Elections.

     

        (a)  General
      Rule.
      Deferral
      Agreements shall be completed by the Director and delivered to the Plan
      Administrator prior to the beginning of the Plan Year in which the Compensation
      to be deferred is otherwise payable to the Director. The Deferral Agreement
      will
      remain in effect from year-to-year until changed by the Participant in
      accordance with the preceding sentence. The Plan Administrator, in his
      discretion, may require an earlier time by which the election to defer
      Compensation must be completed.

     

    
      Page
        3

      
        

      

    

     

        (b)  Initial
      Deferral Election.
      For the Plan Year
      in which a Director first becomes eligible to participate in the Plan (but
      only
      if the Director has never been eligible to participate in another “account
      balance plan,” other than a separation pay plan, of the Company or an affiliate
      that is aggregated with the Plan under Section 409A of the Code), the Director
      may elect to make Deferrals and with respect to services to be performed
      subsequent to the date of the election by completing and delivering a Deferral
      Agreement within 30 days after the date the Director becomes eligible to
      participate in the Plan.

     

    3.3  Amount
      of Deferrals.
      Any Participant
      may elect to defer, pursuant to a Deferral Agreement, the receipt of 50% to
      100%
      (designated in whole percentages) of the Compensation otherwise payable to
      the
      Participant by the Company in any Plan Year. The amount deferred pursuant to
      this Section 3.3 shall be allocated to the Deferral Account maintained for
      the
      Participant.

     

    ARTICLE
      IV

    VESTING

     

    4.1  Vesting.
      Subject to
      Section 9.1 (Participant’s
      Rights Unsecured),
      each Participant
      shall at all times be fully vested in all amounts credited to or allocable
      to
      his Deferral Account and his rights and interest therein shall not be
      forfeitable for any reason.

     

    ARTICLE
      V

    INVESTMENT
      OF ACCOUNTS

     

    5.1  Adjustment
      of Accounts.
      Except as
      otherwise provided elsewhere in the Plan, as of each Valuation Date, each
      Participant’s Accounts will be adjusted to reflect deferrals under
      Article III (Deferrals)
      and the positive
      or negative rate of return on the Investment Funds selected by the Participant
      pursuant to Section 5.2(b) (Investment
      Direction - Participant Directions).
      The rate of
      return will be credited or charged in accordance with policies applied uniformly
      to all Participants.

     

    5.2  Investment
      Direction.

     

        (a)  Investment
      Funds.
      Each Participant
      may direct the hypothetical investment of amounts credited to his Plan accounts
      in the Investment Funds.

     

        (b)  Participant
      Directions.
      Each Participant
      may direct that all of the amounts attributable to his accounts be invested
      in
      either the Company Share Equivalent Account or Interest Fund or may direct
      that
      fractional (percentage) increments of his accounts be invested in the Company
      Share Equivalent Account and Interest Fund as he shall desire in accordance
      with
      such procedures as may be established by the Plan Administrator. 

     

        (c)  Changes
      and Intra-Fund Transfers.
      Participant
      investment directions may be changed, and amounts may be transferred between
      the
      Investment Funds, in accordance with the procedures established by the Plan
      Administrator. The designation will remain in effect until changed by the timely
      submission of a new designation.

     

        (d)  Default
      Selection.
      In the absence of
      any designation, a Participant will be deemed to have directed the investment
      of
      his accounts in the Interest Fund.

     

    
      Page
        4

      
        

      

    

     

        (e)  Impact
      of Election.
      The Participant’s
      selection of Investment Funds shall serve only as a measurement of the value
      of
      the Participant’s Accounts pursuant to Section 5.1 (Adjustment
      of
      Accounts)
      and this
      Section 5.2. Neither the Company nor the Plan Administrator is required to
      actually invest a Participant’s accounts in accordance with the Participant’s
      selections.

     

        (f)  Investment
      Performance.
      Accounts shall be
      adjusted on each Valuation Date to reflect investment gains and losses as if
      the
      accounts were invested in the hypothetical Investment Funds selected by the
      Participants in accordance with this Section 5.2 and charged with any and
      all reasonable expenses as provided in paragraph (g) below. The earnings and
      losses determined by the Plan Administrator in good faith and in his discretion
      pursuant to this Section shall be binding and conclusive on the Participant,
      the
      Participant’s beneficiary and all parties claiming through them.

     

        (g)  Charges.
      The Plan
      Administrator may (but is not required to) charge Participants’ accounts for the
      reasonable expenses of administration including, but not limited to, carrying
      out and/or accounting for investment instructions directly related to such
      accounts.

     

    5.3  Special
      Interest Fund Provisions.

     

        (a)  General.
      The Interest Fund
      shall accrue interest at a rate equal to (i) prior to January 1, 2007, the
      base
      corporate lending rate (sometimes referred to as the “prime rate”) applicable to
      commercial lending customers of Citibank, N.A., New York, New York (or any
      successor thereto); or (ii) from and after January 1, 2007, the rate on U.S.
      Treasury Notes with a maturity of ten years. Such interest shall accrue and
      compound quarterly and be determined as of the last business day of each
      calendar quarter.

     

        (b)  Installment
      Distributions Commencing Prior to January 1, 2007.
      Notwithstanding
      the provisions of Section 5.3(a) (Special
      Interest
      Fund Provisions - General)
      to the contrary,
      if a Participant elected to receive installment distributions pursuant to
      Section 6.3 (Form
      of
      Distribution)
      and such
      distributions commenced on or before December 31, 2006, interest shall accrue
      to
      such Participants’ accounts at a rate equal to the base corporate lending rate
      (sometimes referred to as the “prime rate”) applicable to commercial lending
      customers of Citibank, N.A., New York, New York (or any successor
      thereto).

     

    5.4  Special
      Company Share Equivalent Account Provisions.

     

        (a)  General.
      A Participant’s
      interest in the Company Share Equivalent Account shall be expressed in whole
      and
      fractional hypothetical units of the Company Share Equivalent Account. As a
      general matter, the Company Share Equivalent Account shall track an investment
      in Company Stock and shall generally reflect share ownership for events such
      as
      stock splits. Dividend equivalents will accrue to the Company Share Equivalent
      Account quarterly and will be reinvested. Because investment in the Company
      Share Equivalent Account is investment in a hypothetical account, there shall
      be
      no voting or similar rights associated therewith. The units shall be determined
      by dividing the amount of deferred into the Company Share Equivalent Account
      (or
      dividends credited) by the average of the high and low prices of Company Stock
      on the New York Stock Exchange on the date of such deferral or dividend credit
      (or the next succeeding trading day if there is no trading on that
      date).

     

    
      Page
        5

      
        

      

          

          (b)  Investment
        Directions.
        A Participant’s
        ability to direct investments into or out of the Company Share Equivalent
        Account shall be subject to such procedures as the Plan Administrator may
        prescribe from time to time to assure compliance with Rule 16b-3 promulgated
        under Section 16(b) of the Securities Exchange Act of 1934, as amended, and
        other applicable requirements. Such procedures also may limit or restrict
        a
        Participant’s ability to make (or modify previously made) deferral and
        distribution elections pursuant to Articles III and VI, respectively. In
        furtherance, and not in limitation, of the foregoing, to the extent a
        Participant acquires any interest in an equity security under the Plan for
        purposes of Section 16(b), the Participant shall not dispose of that interest
        within six months, unless specifically exempted by Section 16(b) or any rules
        or
        regulations promulgated thereunder.

    

     

        (c)  Compliance
      with Securities Laws.
      Any election by a
      Participant to hypothetically invest any amount in the Company Share Equivalent
      Account, and any elections to transfer amounts from or to the Company Share
      Equivalent Account to or from any other Investment Fund, shall be subject to
      all
      applicable securities law requirements, including but not limited to the last
      sentence of paragraph (b) next above and Rule 16b-3 promulgated by the
      Securities Exchange Commission. To the extent that any election violates any
      securities law requirement, or the Company’s stock trading policies and
      procedures, the election shall be void.

     

        (d)  Compliance
      with Company Trading Policies and Procedures.
      Any election by a
      Participant to hypothetically invest any amount in the Company Share Equivalent
      Account, and any elections to transfer amounts from or to the Company Share
      Equivalent Account to or from the other Investment Fund, shall be subject to
      all
      Company Stock trading policies promulgated by the Company. To the extent that
      any election violates any such trading policy or procedures, the election shall
      be void.

     

    ARTICLE
      VI

    DISTRIBUTIONS

     

    6.1  Limitation
      on Right to Receive Distribution. A
      Participant (or
      the Participant’s beneficiary in the case of the Participant’s death) shall not
      be entitled to receive a distribution prior to the first to occur of the
      following events:

     

        (a)  The
      Participant’s
      Separation from Service, or, in the case of a Participant who is a Key Employee,
      the date which is six months after the Participant’s Separation from
      Service;

     

        (b)  The
      date the
      Participant becomes Disabled;

     

        (c)  The
      Participant’s
      death;

     

        (d)  A
      specified time
      (or pursuant to a fixed schedule) specified at the date of deferral of
      compensation; 

     

        (e)  An
      Unforeseeable
      Emergency; or

     

        (f)  To
      the extent
      provided by the Secretary of the Treasury, a change in the ownership or
      effective control of the Company or in the ownership of a substantial portion
      of
      the assets of the Company.

     

    The
      provisions of
      this Section 6.1 are intended to impose restrictions on distributions. This
      Section 6.1 does not describe the instances in which distributions will be
      made. Rather, distributions will be made only if and when permitted both by
      this
      Section 6.1 and another provision of the Plan.

     

    
      Page
        6

      
        

      

    

     

    6.2  General
      Right to Receive Distribution. Following
      a
      Participant’s Separation from Service or Disability, the Participant’s Plan
      accounts will be distributed to the Participant at the time and in the manner
      provided in Sections 6.5 (Timing
      of
      Distribution)
      and 6.3
      (Form
      of
      Distribution).

     

    6.3  Form
      of
      Distribution.
      Accounts shall be
      distributed in cash in a single lump sum payment or in up to ten annual
      installments. Distributions shall be subject to such uniform rules and
      procedures as may be adopted by the Plan Administrator from time to time. The
      method of payment shall be selected by the Participant in the initial
      Distribution Election Form (which may be contained in and be a part of a
      Deferral Agreement) submitted by the Participant to the Plan Administrator
      on
      entry into the Plan.

     

    6.4  Amount
      of Distribution.
      The amount
      distributed to a Participant shall equal the sum of the vested amounts credited
      to the Participant’s accounts as of the Valuation Date immediately preceding the
      date of the distribution. Amounts invested in the Company Share Equivalent
      Account shall be based on the fair market value of the Company Stock on the
      relevant Valuation Date determined pursuant to uniform and non-discriminatory
      rules established by the Plan Administrator.

     

    6.5  Timing
      of Distribution.
      Funds will be
      distributed (or in the case of installment distributions, such installments
      shall commence) as soon as practicable after the January 1 coincident with
      or
      next following the Participant’s Separation from Service (but not sooner than
      the six-month anniversary of such Separation in the case of a Key Employee).
      Notwithstanding the foregoing, in the event that Separation from Service occurs
      due to death or Disability, funds may be distributed in a lump sum as soon
      as
      practicable after Separation from Service. 

     

    6.6  Payment
      Upon Death.

     

        (a)  If
      a Participant
      should die before receiving a full distribution of his Plan accounts,
      distribution shall be made to the beneficiary designated by the Participant.
      If
      a Participant has not designated a beneficiary, or if no designated beneficiary
      is living on the date of distribution, such amounts shall be distributed to
      the
      Participant’s estate.

     

        (b)  Timing
      and Form of Payment to Beneficiary.

     

            (i)  Payments
      Commenced at Time of Death.
If,
      at the time of
      the Participant’s death, installment payments of the Participant’s accounts has
      commenced pursuant to this Article VI,
      such payments
      shall continue to the Participant’s beneficiary in the same time and the same
      form as if the Participant has remained alive until the last installment payment
      was scheduled to be made.

     

            (ii)  Payments
      Not Commenced at Time of Death.
      If, at the time
      of the Participant’s death, payments of the Participant’s accounts has not
      commenced pursuant to this Article VI, the distributions made pursuant to this
      Section 6.7 shall be made to the Participant’s beneficiary in accordance with
      the then current and valid distribution election made by the Participant (or,
      in
      the absence of such a distribution election, in accordance with the “default”
provisions of Section 6.3 (Form of Distribution)).

     

    6.7  Payment
      Upon Unforeseeable Emergency.
      Notwithstanding
      any provision of the Plan to the contrary, if a Participant incurs an
      Unforeseeable Emergency, the Participant may elect to make a withdrawal from
      the
      adjusted balance of the Participant’s account. Distribution shall only be made
      on account of Unforeseeable Emergency if, as determined under regulations of
      the
      Secretary of the Treasury, the amounts distributed with respect to an emergency
      do not exceed the amounts necessary to satisfy such emergency plus amounts
      necessary to pay taxes reasonably anticipated as a result of the distribution,
      after taking into account the extent to which such hardship is or may be
      relieved:

     

    
      Page
        7

      
        

      

    

     

        (a)  through
      reimbursement or compensation by insurance or otherwise;

     

        (b)  by
      liquidation of
      the Participant’s assets, to the extent the liquidation of such assets would not
      itself cause severe financial hardship; or

     

        (c)  by
      cessation of
      deferrals under the Plan.

     

    A
      Participant who
      wishes to receive a distribution pursuant to this Section 6.8 shall apply for
      such distribution to the Plan Administrator and shall provide information to
      the
      Plan Administrator reasonably necessary to permit the Plan Administrator to
      determine whether an Unforeseeable Emergency exists and the amount of the
      distribution reasonably needed to satisfy the emergency need.

     

    6.8  De
      Minimis Distribution.
      Subject to
      Section 6.5 (Timing
      of
      Distribution)
      regarding Key
      Employees, if a Participant incurs a Separation from Service and as of the
      “payment date,” the value of the Participant’s accounts is $10,000.00 or less,
      the Participant’s accounts shall be distributed to the Participant in a single
      lump sum regardless of any elections made by the Participant pursuant to Section
      6.3 (Form
      of
      Distribution).
      For purposes of
      this Section 6.9, the “payment date” shall be the date on which the
      Participant’s accounts are distributed pursuant to this Section 6.9. In no event
      shall the “payment date” be later than the later of (a) December 31 of the Plan
      Year in which the Participant’s Separation of Service occurs and (b) the date
      which is two and one-half months immediately following the Participant’s
      Separation from Service.

     

    6.9  Withholding.
      All distributions
      will be subject to all applicable tax and withholding requirements.

     

    6.10  Ban
      on
      Acceleration of Benefits.
      Notwithstanding
      any other provision of the Plan to the contrary, neither the time nor the
      schedule of any payment under the Plan may be accelerated except as provided
      in
      regulations or other guidance issued by the Internal Revenue Service or the
      Department of the Treasury.

     

     

    ARTICLE
      VII

    ADMINISTRATION
      OF THE PLAN

     

    7.1  General
      Powers and Duties.

     

        (a)  General.
      The Plan
      Administrator shall perform the duties and exercise the powers and discretion
      given to him in the Plan document and by applicable law and his decisions and
      actions shall be final and conclusive as to all persons affected thereby. The
      Company and the Adopting Affiliates shall furnish the Plan Administrator with
      all data and information that the Plan Administrator may reasonably require
      in
      order to perform his functions. The Plan Administrator may rely without question
      upon any such data or information.

     

        (b)  Disputes.
      Any and all
      disputes that may arise involving Participants or beneficiaries shall be
      referred to the Plan Administrator and his decision shall be final. Furthermore,
      if any question arises as to the meaning, interpretation or application of
      any
      provisions of the Plan, the decision of the Plan Administrator shall be
      final.

     

        (c)  Agents.
      The Plan
      Administrator may engage agents, including recordkeepers, to assist him and
      he
      may engage legal counsel who may be counsel for the Company. The Plan
      Administrator shall not be responsible for any action taken or omitted to be
      taken on the advice of such counsel, including written opinions or certificates
      of any agent, counsel, actuary or physician.

     

        (d)  Insurance.
      At the C+B
      Officer’s request, the Company shall purchase liability insurance to cover the
      C+B Officer in his activities as the Plan Administrator.

     

    
      Page
        8

      
        

      

       

    

        (e)  Allocations.
      The Plan
      Administrator is given specific authority to allocate responsibilities to others
      and to revoke such allocations. When the Plan Administrator has allocated
      authority pursuant to this paragraph, the Plan Administrator is not to be liable
      for the acts or omissions of the party to whom such responsibility has been
      allocated.

     

        (f)  Records.
      The Plan
      Administrator shall supervise the establishment and maintenance of records
      by
      its agents, the Company and each Adopting Affiliate containing all relevant
      data
      pertaining to any person affected hereby and his or her rights under the Plan.
      In addition, the Plan Administrator may, in its discretion, establish a system
      for complete or partial electronic administration of the Plan and may replace
      any written documents described in the Plan with electronic counterparts as
      it
      deems appropriate.

     

        (g)  Interpretations.
      The Plan
      Administrator, in his sole discretion, shall interpret and construe the
      provisions of the Plan (and any underlying documents or policies).

     

        (h)  Electronic
      Administration.
      The Plan
      Administrator shall have the authority to employ alternative means (including,
      but not limited to, electronic, internet, intranet, voice response or
      telephonic) by which Participants may submit elections, directions and forms
      required for participation in, and the administration of, the Plan. If the
      Plan
      Administrator chooses to use these alternative means, any elections, directions
      or forms submitted in accordance with the rules and procedures promulgated
      by
      the Plan Administrator will be deemed to satisfy any provision of the Plan
      calling for the submission of a written election, direction or
      form.

     

        (i)  Accounts.
      The Plan
      Administrator shall combine the various accounts of a Participant if he deems
      such action appropriate. Furthermore, the Plan Administrator shall divide a
      Participant’s accounts into sub-accounts if he deems such action
      appropriate.

     

    The
      foregoing list
      of powers and duties is not intended to be exhaustive, and the Plan
      Administrator shall, in addition, exercise such other powers and perform such
      other duties as he may deem advisable in the administration of the Plan, unless
      such powers or duties are expressly assigned to another pursuant to the
      provisions of the Plan.

     

    ARTICLE
      VIII

    AMENDMENT

     

    8.1  Amendment.
      The Company
      reserves the right to amend the Plan when, in the sole discretion of the
      Company, such amendment is advisable.

     

    8.2  Effect
      of Amendment.
      Any amendment of
      the Plan shall apply prospectively only and shall not directly or indirectly
      reduce the balance of any Plan account as of the effective date of such
      amendment.

     

    8.3  Termination.
      The Company
      expressly reserves the right to terminate the Plan. In the event of termination,
      the Company shall specify whether termination will change the time at which
      distributions are made; provided that any acceleration of a distribution is
      consistent with Section 409A of the Code. In the absence of such
      specification, the timing of distributions shall be unaffected by
      termination.

     

    
      Page
        9

      
        

      

    

     

    ARTICLE
      IX

    GENERAL
      PROVISIONS

     

    9.1  Participant’s
      Rights Unsecured.
      The Plan at all
      times shall be entirely unfunded and no provision shall at any time be made
      with
      respect to segregating any assets of the Company for payment of any
      distributions hereunder. The right of a Participant or his or her designated
      beneficiary to receive a distribution hereunder shall be an unsecured claim
      against the general assets of the Company, and neither the Participant nor
      a
      designated beneficiary shall have any rights in or against any specific assets
      of the Company. All amounts credited to a Participant’s accounts hereunder shall
      constitute general assets of the Company and may be disposed of by the Company
      at such time and for such purposes as it may deem appropriate. Nothing in this
      Section shall preclude the Company from establishing a “Rabbi Trust,” but the
      assets in the Rabbi Trust must be available to pay the claims of the Company’s
      general creditors in the event of the Company’s insolvency.

     

    9.2  No
      Guaranty of Benefits.
      Nothing contained
      in the Plan shall constitute a guaranty by the Company or any other person
      or
      entity that the assets of the Company will be sufficient to pay any benefit
      hereunder.

     

    9.3  Section
      409A Compliance.
      The Company
      intends that the Plan meet the requirements of Section 409A of the Code and
      the
      guidance issued thereunder. The Plan shall be construed and interpreted in
      a
      manner consistent with that intention.

     

    9.4  Spendthrift
      Provision.
      No interest of
      any person or entity in, or right to receive a distribution under, the Plan
      shall be subject in any manner to sale, transfer, assignment, pledge,
      attachment, garnishment, or other alienation or encumbrance of any kind; nor
      shall any such interest or right to receive a distribution be taken, either
      voluntarily or involuntarily, for the satisfaction of the debts of, or other
      obligations or claims against, such person or entity, including claims in
      bankruptcy proceedings. This Section shall not preclude arrangements for the
      withholding of taxes from deferrals, credits, or benefit payments, arrangements
      for the recovery of benefit overpayments, arrangements for the transfer of
      benefit rights to another plan, or arrangements for direct deposit of benefit
      payments to an account in a bank, savings and loan association or credit union
      (provided that such arrangement is not part of an arrangement constituting
      an
      assignment or alienation).

     

    9.5  Domestic
      Relations Orders.
      Notwithstanding
      the provisions of Section 9.4 (Spendthrift
      Provision)
      to the contrary
      and to the extent permitted by law, the amounts payable pursuant to the Plan
      may
      be assigned or alienated pursuant to a “Domestic Relations Order” (as such term
      is defined in Section 414(p)(1)(B) of the Code).

     

    9.6  Incapacity
      of Recipient.
      If the Plan
      Administrator is served with a court order holding that a person entitled to
      a
      distribution under the Plan is incapable of personally receiving and giving
      a
      valid receipt for such distribution, the Plan Administrator shall postpone
      payment until such time as a claim therefore shall have been made by a duly
      appointed guardian or other legal representative of such person. The Plan
      Administrator is under no obligation to inquire or investigate as to the
      competency of any person entitled to a distribution. Any payment to an appointed
      guardian or other legal representative under this Section shall be a payment
      for
      the account of the incapacitated person and a complete discharge of any
      liability of the Company and the Plan therefore.

     

    9.7  Successors.
      The Plan shall be
      binding upon the successors and assigns of the Company and upon the heirs,
      beneficiaries and personal representatives of the individuals who become
      Participants hereunder.

     

    9.8  Limitations
      on Liability.
      Notwithstanding
      any of the preceding provisions of the Plan, neither the Plan Administrator,
      the
      Company, nor any individual acting as the Plan Administrator’s, or the Company’s
      employee, agent, or representative shall be liable to any Participant, former
      Participant, beneficiary or other person for any claim, loss, liability or
      expense incurred in connection with the Plan.

     

    
      Page
        10

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