Document:

exv10w2

Exhibit 10.2

McAfee, Inc.
1997 Stock Incentive Plan, as amended

Stock Option Agreement

1. Grant of Option. The Company hereby grants Optionee an Option to purchase the number of
shares of the Company’s common stock (“Shares”) under the McAfee, Inc. 1997 Stock Incentive Plan,
as amended (the “Plan”), as set forth in the Notice of Grant (the “Notice”). The terms of this
Option are set forth in the Plan, the Notice and this Stock Option Agreement including the Appendix
(the “Agreement”). In the event of a conflict between the terms and conditions of the Plan and the
terms and conditions of this Agreement or the Notice, the terms and conditions of the Plan shall
prevail. Capitalized terms used in this Agreement without definition shall have the meanings
ascribed to such terms in the Plan or the Notice as applicable.

2. Exercise of Option.

     (a) Right to Exercise. This Option is exercisable during its term in accordance with
the vesting schedule and restrictions on exercisability set forth in the Notice and the applicable
provisions of the Plan and this Agreement.

     (b) Method of Exercise.

          (i) This Option may be exercised through the Company’s designated broker. The Optionee shall
specify the number of Shares being purchased, and the exercise shall be effective when the online
exercise is complete or hard copy exercise notice is provided to the Company (if permitted) and the
aggregate Exercise Price for the number of Shares being purchased, and any Tax-Related Items (as
defined in Section 11 below), is received by the Company.

          (ii) No Shares will be issued pursuant to the exercise of an Option (and no exercise will be
permitted) unless such issuance and such exercise complies with all relevant applicable provisions
of law, whether foreign or domestic, and the requirements of any stock exchange or interdealer
quotation system upon which the Shares may then be listed or traded.

          (iii) If this Option is being exercised by the representative of the Optionee, the
representative must prove the Company’s satisfaction that he or she is entitled to do so.

3. Method of Payment.

     (a) Unless provided otherwise in the Appendix, payment of the Exercise Price shall be by any
of the following, or a combination thereof, at the election of Optionee: (i) cash in U.S. dollars,
(ii) check payable in U.S. dollars, (iii) irrevocable directions to a designated broker appointed
by the Company to sell all or a portion of the Shares subject to the exercised Option, and to
deliver to the Company from the sale proceeds an amount sufficient to pay the Exercise Price and
any Tax-Related Items (as defined in Section 11 below). The balance of the sale proceeds, if any,
will be delivered to Optionee in cash if all Shares were directed to be sold, or in Shares if only
a portion of the Shares were directed to be sold to cover the Exercise Price and Tax-Related Items
(as defined in Section 11 below). Regardless of the method of payment of the Exercise Price, the
exercise instructions must be received in a form approved by the Company and Optionee must provide
any other documentation required by the Company at the time of exercise.

     (b) Neither the Optionee nor the Optionee’s representative shall have any rights as a
shareholder with respect to any Shares subject to this Option until the Optionee or the Optionee’s
representative becomes entitled to receive such Shares by completing an exercise as described in
Section 2 above and paying the aggregate Exercise Price pursuant to Section 2 and Section 3(a).

4. Termination of Relationship for Any Reason except Death or Disability. In the event an
Optionee’s active service as an Employee or Consultant terminates for any reason except Disability
(as defined below) or death, Optionee may, to the extent this Option was vested at the Termination
Date (as defined below), exercise this
Option at any time during the 90-day period immediately following the Termination Date. To the
extent that Optionee was

 

 

not vested in this Option at the Termination Date, or if Optionee does not
exercise this Option within the time specified herein, this Option shall terminate.
Notwithstanding the foregoing, in no event shall any Option be exercisable later than the
Expiration Date as provided in the Notice. “Termination Date” shall be defined as the date an
Optionee’s active service as an Employee or Consultant terminates, as determined by the Company in
its sole discretion. For the purposes of this Agreement, the Termination Date will not be extended
to include any notice period mandated under local law.

5. Termination of Relationship in Event of Death or Disability of Optionee. In the event
an Optionee’s active service as an Employee or Consultant terminates as a result of his or her
death or Disability, Optionee (or his or her estate or legal representative in the event of death)
may, to the extent this Option was vested at the Termination Date, exercise this Option at any time
during the 12-month period immediately following the Termination Date. To the extent that Optionee
was not vested in this Option at the Termination Date, or if Optionee (or his or her estate or
legal representative in the event of death) does not exercise this Option within the time specified
herein, this Option shall terminate. Notwithstanding the foregoing, in no event shall any Option
be exercisable later than the Expiration Date as provided in the Notice. For the purposes of
receiving treatment under this Section 5, “Disability” shall be defined as an inability to engage
in any substantial gainful activity by reason of any medically determinable physical or mental
impairment that can be expected to result in death or can be expected to last for a continuous
period of not less than 12 months. For the purposes of administering the Plan, the Company shall
determine in its sole discretion whether Optionee’s active service terminated due to death or
Disability.

6. Non-Transferability of Option. Unless otherwise provided in the Plan, this Option may
not be transferred in any manner otherwise than by will or by the laws of descent and distribution
and may be exercised during the lifetime of Optionee only by the Optionee. The terms of the
Notice, the Plan and this Agreement shall be binding upon the executors, administrators, heirs,
successors and assigns of the Optionee.

7. Term of Option. This Option may be exercised only within the term set out in the Notice
and this Agreement, and may be exercised during such term only in accordance with the terms of the
Notice, the Plan and this Agreement.

8. Adjustment. The number of Shares subject to the Option shall be subject to adjustment
as provided in Article 10 of the Plan.

9. Data Privacy. Optionee hereby explicitly and unambiguously consents to the collection,
use and transfer, in electronic or other form, of his or her personal data as described in this
Agreement by and among, as applicable, the employer (“the Employer”), the Company and any
Subsidiary or Affiliate for the exclusive purpose of implementing, administering and managing his
or her participation in the Plan.

Optionee understands that the Company and his or her Employer may hold certain personal information
about Optionee, including, but not limited to, his or her name, home address and telephone number,
date of birth, social insurance number or other identification number, salary, nationality, job
title, any Shares or directorships held in the Company or any Subsidiary or Affiliate, details of
all Options or any other entitlement to Shares awarded, canceled, exercised, vested, unvested or
outstanding in Optionee’s favor, for the exclusive purpose of implementing, administering and
managing the Plan (“Data”).

Optionee understands that Data will be transferred to E*Trade Financial Services, Inc. or to any
other third party assisting in the implementation, administration and management of the Plan.
Optionee understands that the recipients of the Data may be located in Optionee’s country or
elsewhere, and that the recipient’s country may have different data privacy laws and protections
than Optionee’s country. Optionee understands that he or she may request a list with the names and
addresses of any potential recipients of the Data by contacting his or her local human resources
representative. Optionee authorizes the Company, E*Trade Financial Services, Inc. and any other
recipients of Data which may assist the Company (presently or in the future) with implementing,
administering and managing the Plan to receive, possess, use, retain and transfer the Data, in
electronic or
other form, for the purposes of implementing, administering and managing Optionee’s participation
in the Plan, including any requisite transfer of such Data as may be required to a broker or other
third party with whom Optionee may elect to deposit any Shares purchased upon exercise of the
Option. Optionee understands that

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Data will be held only as long as is necessary to implement,
administer and manage his or her participation in the Plan. Optionee understands that he or she
may, at any time, view Data, request additional information about the storage and processing of
Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any
case without cost, by contacting in writing Optionee’s local human resources representative.
Optionee understands that refusal or withdrawal of consent may affect Optionee’s ability to
participate in the Plan. For more information on the consequences of his or her refusal to consent
or withdrawal of consent, Optionee understands that he or she may contact his or her local human
resources representative.

10. Nature of Grant. In accepting the grant, Optionee acknowledges that:

     (a) the Plan is established voluntarily by the Company, is discretionary in nature,
and may be modified, amended, suspended or terminated by the Company at any time;

     (b) the grant of the Option is voluntary and occasional and does not create any contractual or
other right to receive future grants of options, or benefits in lieu of options, even if options
have been granted repeatedly in the past;

     (c) all decisions with respect to future option grants, if any, will be at the sole discretion
of the Company;

     (d) Optionee’s participation in the Plan is voluntary;

     (e) Optionee’s participation in the Plan shall not create a right to further employment with
the Employer and shall not interfere with the ability of the Employer to terminate Optionee’s
employment or service relationship (if any) at any time;

     (f) Optionee is voluntarily participating in the Plan;

     (g) the Option and any Shares purchased under the Plan are extraordinary items that do not
constitute compensation of any kind for services of any kind rendered to the Employer, the Company
or any Subsidiary or Affiliate, and that are outside the scope of Optionee’s employment or service
contract, if any;

     (h) the Option and any Shares purchased under the Plan are not intended to replace any pension
rights or compensation;

     (i) the Option and any Shares purchased under the Plan are not part of normal or expected
compensation or salary for any purposes, including, but not limited to, calculating any severance,
resignation, termination, redundancy, end-of-service payments, bonuses, long-service awards,
pension or retirement or welfare benefits or similar payments and in no event should be considered
as compensation for, or relating in any way to, past services for the Employer, the Company or any
Subsidiary or Affiliate;

     (j) in the event that Optionee is not a direct employee of Company, the Option grant will not
be interpreted to form an employment contract or relationship with Company and furthermore, the
Option grant will not be interpreted to form an employment contract with Optionee’s Employer or any
Subsidiary or Affiliate;

     (k) the future value of the Shares underlying the Option is unknown and cannot be predicted
with certainty;

     (l) if the underlying Shares do not increase in value, the Option will have no value;

     (m) if Optionee exercises the Option and purchases Shares, the value of such Shares may
increase or decrease in value, even below the Exercise Price;

     (n) in consideration of the grant of the Option, no claim or entitlement to compensation or
damages shall arise from termination of the vesting of the Option or cancellation of the Option
following termination of Optionee’s active service as an Employee or Consultant (for any reason
whatsoever and whether or not in breach of

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local labor laws) and Optionee irrevocably releases the
Employer, the Company and any Subsidiary or Affiliate from any such claim that may arise; if,
notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have
arisen, then, by signing the Notice, Optionee shall be deemed irrevocably to have waived his or her
entitlement to pursue such claim;

     (o) notwithstanding any terms or conditions of the Plan to the contrary, in the event of
voluntary or involuntary termination of Optionee’s active service as an Employee or Consultant,(i)
Optionee’s right to receive Options and vest in Options under the Plan, if any, will terminate
effective as of the Termination Date, and (ii) Optionee’s right to exercise the Options after
termination of active service as an Employee or Consultant, if any, will be measured by the
Termination Date;

     (p) the Company is not providing any tax, legal or financial advice, nor is the Company making
any recommendations regarding Optionee’s participation in the Plan or Optionee’s purchase or sale
of Shares; and

     (q) Optionee is hereby advised to consult with his or her own personal tax, legal and
financial advisors regarding participation in the Plan before taking any action related to the
Plan; and the Option and the benefits under the Plan, if any, will not automatically transfer to
another company in the case of a merger, take-over or transfer of liability.

11. Responsibility for Taxes.

     (a) Regardless of any action the Company and/or the Employer takes with respect to any or all
income tax, social insurance, payroll tax, payment on account or other tax-related items arising
out of Optionee’s participation in the Plan and legally applicable to Optionee (“Tax-Related
Items”), Optionee acknowledges that the ultimate liability for all Tax-Related Items is and remains
Optionee’s responsibility and may exceed the amount actually withheld by the Company and/or the
Employer. Optionee further acknowledges that the Company and/or the Employer (a) make no
representations or undertakings regarding the treatment of any Tax-Related Items in connection with
any aspect of the Option grant, including, but not limited to, the grant, vesting or exercise of
the Option, the subsequent sale of Shares purchased pursuant to such exercise and the receipt of
any dividends; and (b) do not commit and are under no obligation to structure the terms of the
grant or any aspect of the Option to reduce or eliminate Optionee’s liability for Tax-Related Items
or achieve any particular tax result. Further, if Optionee has become subject to tax in more than
one jurisdiction between the grant date and the date of any relevant taxable event, Optionee
acknowledges that the Company and/or the Employer (or former employer, as applicable) may be
required to withhold or account for Tax-Related Items in more than one jurisdiction.

     (b) Prior to the relevant taxable or tax withholding event, as applicable, Optionee shall pay
or make arrangements satisfactory to the Company and/or the Employer to satisfy all Tax-Related
Items. In this regard, Optionee authorizes the Company and/or the Employer, or their respective
agents, at their discretion, to satisfy the Tax-Related Items by one or a combination of the
following: (i) withholding from Optionee’s wages or other cash compensation paid to Optionee by the
Company, the Employer and any Subsidiary or Affiliate; or (ii) withholding from proceeds of the
sale of Shares acquired at exercise of the Option either through a voluntary sale or through a
mandatory sale arranged by the Company (on Optionee’s behalf pursuant to this authorization); or
(iii) withholding in Shares to be issued at exercise of the Option.

     (c) To avoid any negative accounting treatment, the Company may withhold or account for
Tax-Related Items by considering applicable minimum statutory withholding amounts or other
applicable withholding rates. If the obligation for Tax-Related Items is satisfied by withholding
in Shares, for tax purposes, Optionee is deemed to have been issued the full number of Shares
subject to the exercised Options, notwithstanding that a number of the Shares are held back solely
for the purpose of paying the Tax-Related Items due as a result of any aspect of Optionee’s
participation in the Plan.

     (d) Optionee shall pay to the Company or the Employer any amount of Tax-Related Items that the
Company or the Employer may be required to withhold or account for as a result of Optionee’s
participation in the Plan that cannot be satisfied by the means previously described in this
section. The Company may refuse to issue or deliver the Shares or the proceeds from the sale of
Shares, if Optionee fails to comply with his or her obligations in connection with the Tax-Related
Items as described in this section.

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12. Entire Agreement; Governing Law. The Plan is incorporated herein by reference. The
Plan, the Notice, and this Agreement ,including the Appendix, constitute the entire agreement of
the parties with respect to the subject matter hereof and supersede in their entirety all prior
undertakings and agreements and all contemporaneous oral undertakings and agreements of the Company
and Optionee with respect to the subject matter hereof, and may not be modified to materially and
adversely affect the Optionee’s interest except by means of a writing signed by the Company and
Optionee. This Agreement shall be governed by the laws of the State of Delaware without giving
effect to the conflict of law principles thereof. For purposes of litigating any dispute that
arises directly or indirectly from the relationship of the parties evidenced by this grant or this
Agreement, the parties hereby submit to and consent to the exclusive jurisdiction of the State of
California, and agree that such litigation shall be conducted only in the courts of Santa Clara
County, California, or the federal courts for the United States for the Northern District of
California, and no other courts, where this grant is made and/or to be performed.

13. Language. If Optionee has received this Agreement, or any other document related to
the Option and/or the Plan translated into a language other than English and if the translated
version is different than the English version, the English version will control.

14. Severability. The provisions of this Agreement are severable and if any one or more
provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the
remaining provisions shall nevertheless be binding and enforceable.

15. No Advice Regarding Award. The Company is not providing any tax, legal or financial
advice, nor is the Company making any recommendation regarding the Optionee’s participation in the
Plan, or the acquisition or sale of underlying Shares. The Optionee is advised to consult with his
or her personal tax, legal, and financial advisors regarding the decision to participate in the
Plan and before taking any action related to the Plan.

16. Electronic Delivery and Participation. The Company may, in its sole discretion, decide
to deliver any documents related to the Option or future options that may be granted under the Plan
by electronic means or request Optionee’s consent to participate in the Plan by electronic means.
Optionee hereby consents to receive such documents by electronic delivery and, if requested, to
agree to participate in the Plan through an on-line or electronic system established and maintained
by the Company or a third party designated by the Company.

17. Severability. The provisions of this Agreement are severable and if any one or more
provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the
remaining provisions shall nevertheless be binding and enforceable.

18. Appendix. The Option shall be subject to any special provisions set forth in the
country-specific Appendix for Optionee’s country of residence, as applicable (the “Appendix”). If
Optionee relocates to one of the countries included in the Appendix during the life of the Option,
the special provisions for such country shall apply to Optionee, to the extent the Company
determines that the application of such provisions is necessary or advisable in order to comply
with local law or facilitate the administration of the Plan. The Appendix constitutes part of this
Agreement.

19. Tax Consequences.

Non-U.S. taxpayers: Optionee should consult a tax adviser to determine the tax consequences
applicable to their particular situation before exercising this Option or disposing of the Shares.
The following provisions of this Section 19 apply only to U.S. taxpayers.

U.S. taxpayers: Optionee acknowledges that he or she has read the description of tax U.S.
consequences set forth below and has consulted his or her personal tax advisor regarding the same
to the extent he or she has determined advisable. Optionee is not relying on the Company, or any
of its officers, directors, employees or advisors, for any tax advice or planning information
whatsoever. Set forth below is a brief summary as of the date of this Option of some of the U.S.
federal tax consequences of exercise of this Option and disposition of the Shares. THIS SUMMARY IS
NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT

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TO CHANGE. OPTIONEE SHOULD
CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.

     (a) Exercise of Nonstatutory Stock Option. There may be a regular federal income tax
liability upon the exercise of a nonstatutory stock option. Optionee will be treated as having
received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of
the Fair Market Value of the Shares on the date of exercise over the Exercise Price. If Optionee
is an Employee or a former Employee, the Company will be required to withhold for U.S. federal
taxes and FICA from Optionee’s compensation or proceeds from exercise or otherwise collect these
amounts from Optionee.

     (b) Disposition of Shares. In the case of a nonstatutory stock option, if Shares are
held for at least one year, any gain realized on disposition of the Shares (i.e., the sales price
of the Shares less the Fair Market Value of the Shares at exercise) will be treated as long-term
capital gain for federal tax purposes.

20. Imposition of Other Requirements. The Company reserves the right to impose other
requirements on the Option and the Shares purchased upon exercise of the Option, to the extent the
Company determines it is necessary or advisable in order to comply with local laws or facilitate
the administration of the Plan, and to require Optionee to sign any additional agreements or
undertakings that may be necessary to accomplish the foregoing.

Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations
of the Administrator upon any questions relating to the Notice, the Plan and this Agreement.

* * * * *

By Optionee’s electronic acceptance and/or signature on the Notice, the Optionee agrees that this
Option is granted under and governed by the terms and conditions of the Notice, the Plan and this
Agreement.

6EX-10.1

EXHIBIT 10.1

AMENDED AND RESTATED

2002 DEVELOPERS DIVERSIFIED REALTY CORPORATION

EQUITY-BASED AWARD PLAN

SECTION 1. PURPOSE; DEFINITIONS.

     The purpose of the Amended and Restated 2002 Developers Diversified Realty Corporation
Equity-Based Award Plan (the “Plan”) is to enable Developers Diversified Realty Corporation (the
“Company”) and its Subsidiaries (as defined below) to attract, retain and reward employees and
directors of the Company, its Subsidiaries and Affiliates designated by the Company’s Board of
Directors and strengthen the mutuality of interests between those employees and directors and the
Company’s shareholders by offering the employees and directors equity or equity-based incentives
thereby increasing their proprietary interest in the Company’s business and enhancing their
personal interest in the Company’s success.

     For purposes of the Plan, the following terms are defined as follows:

     (a) “Affiliate” means any entity (other than the Company and any Subsidiary) that is
designated by the Board as a participating employer under the Plan.

     (b) “Award” means any award of Stock Options, Share Appreciation Rights, Restricted Shares,
Deferred Shares, Share Purchase Rights or Other Share-Based Awards under the Plan.

     (c) “Board” means the Board of Directors of the Company.

     (d) “Cause” means, unless otherwise provided by the Committee, (i) “Cause” as defined in any
Individual Agreement to which the participant is a party, or (ii) if there is no such Individual
Agreement or if it does not define Cause: (A) conviction of the participant for committing a felony
under federal law or in the law of the state in which such action occurred, (B) dishonesty in the
course of fulfilling the participant’s employment duties, (C) willful and deliberate failure on the
part of the participant to perform his or her employment duties in any material respect, or (D)
prior to a Change in Control, such other events as shall be determined by the Committee. The
Committee shall, unless otherwise provided in an Individual Agreement with the participant, have
the sole discretion to determine whether “Cause” exists, and its determination shall be final.

     (e) “Change in Control” has the meaning set forth in Section 12(b).

     (f) “Code” means the Internal Revenue Code of 1986, as amended from time to time, and any
successor thereto.

     (g) “Committee” means the Granting Committee of the Board of the Company or any other
committee authorized by the Board to administer the Plan of which all the members are both Outside
Directors and Non-Employee Directors.

 

 

     (h) “Company” means Developers Diversified Realty Corporation, an Ohio corporation, or any
successor corporation.

     (i) “Deferred Shares” means an Award of the right to receive Shares at the end of a specified
deferral period granted pursuant to Section 8.

     (j) “Disability” means a permanent and total disability as defined in Section 22(e)(3) of the
Code.

     (k) “Dividend Equivalent” means a right, granted to a participant under Section 10 hereof, to
receive cash, Shares, other Awards or other property equal in value to dividends paid with respect
to a specified number of Shares, or other periodic payments.

     (l) “Exchange Act” means the Securities Exchange Act of 1934, as amended.

     (m) “Fair Market Value” means, as of a given date, (in order of applicability): (i) the
closing price of a Share on the principal exchange on which the Shares are then trading, if any, on
the day immediately prior to such date, or if Shares were not traded on the day previous to such
date, then on the next preceding trading day during which a sale occurred; or (ii) if Shares are
not traded on an exchange but are quoted on NASDAQ or a successor quotation system, (A) the last
sale price (if Shares are then listed as a National Market Issue under the NASD National Market
System) or (B) if Shares are not then so listed, the mean between the closing representative bid
and asked prices for Shares on the day previous to such date as reported by NASDAQ or such
successor quotation system; or (iii) if Shares are not publicly traded on an exchange and not
quoted on NASDAQ or a successor quotation system, the mean between the closing bid and asked prices
for Shares, on the day previous to such date, as determined in good faith by the Committee; or (iv)
if Shares are not publicly traded, the fair market value established by the Committee acting in
good faith.

     (n) “Incentive Stock Option” means any Stock Option intended to be and designated as, and that
otherwise qualifies as, an “Incentive Stock Option” within the meaning of Section 422 of the Code
or any successor section thereto.

     (o) “Individual Agreement” means an employment or similar agreement between a participant and
the Company or one of its Subsidiaries or Affiliates.

     (p) “Non-Employee Director” has the meaning set forth under Section 16 of the Exchange Act.

     (q) “Non-Qualified Stock Option” means any Stock Option that is not an Incentive Stock Option.

     (r) “Other Share-Based Awards” means an Award granted pursuant to Section 10 that is valued,
in whole or in part, by reference to, or is otherwise based on, Shares.

     (s) “Outside Director” has the meaning set forth in Section 162(m) of the Code and the
regulations promulgated thereunder.

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     (t) “Plan” means the Amended and Restated 2002 Developers Diversified Realty Corporation
Equity-Based Award Plan, as amended from time to time.

     (u) “Potential Change in Control” has the meaning set forth in Section 12(c).

     (v) “Retirement” means retirement from active employment with the Company, a Subsidiary or
Affiliate at the earlier to occur of: (a) a participant attaining the age of 55 or (b) a
participant attaining the age of 50 and accruing 15 years of credited service for the Company, a
Subsidiary or Affiliate.

     (w) “Restricted Shares” means an Award of Shares that is granted pursuant to Section 7 and is
subject to restrictions.

     (x) “Section 16 Participant” means a participant under the Plan who is subject to Section 16
of the Exchange Act.

     (y) “Share Appreciation Right” means an Award of a right to receive an amount from the Company
that is granted pursuant to Section 6.

     (z) “Shares” means the Common Shares, $0.10 par value, of the Company.

     (aa) “Stock Option” or “Option” means any option to purchase Shares (including Restricted
Shares and Deferred Shares, if the Committee so determines) that is granted pursuant to Section 5.

     (bb) “Share Purchase Right” means an Award of the right to purchase Shares that is granted
pursuant to Section 9.

     (cc) “Subsidiary” means any corporation (other than the Company) in an unbroken chain of
corporations beginning with the Company if each of the corporations (other than the last
corporation in the unbroken chain) owns stock possessing 50% or more of the total combined voting
power of all classes of stock in one of the other corporations in that chain.

SECTION 2. ADMINISTRATION.

     The Plan shall be administered by the Committee. The Committee shall consist of not less than
three directors of the Company, all of whom shall be Outside Directors and Non-Employee Directors.
Those directors shall be appointed by the Board and shall serve as the Committee at the pleasure of
the Board. The functions of the Committee specified in the Plan shall be exercised by the members
of the Board who are Non-Employee Directors if and to the extent that no Committee exists that has
the authority to so administer the Plan.

     The Committee shall have full power to interpret and administer the Plan and full authority to
select the individuals to whom Awards will be granted (other than Awards to directors of the
Company that must be approved by the Board) and to determine the type and amount of any Award to be
granted to each participant, the consideration, if any, to be paid for any Award, the timing of
each Award, the terms and conditions of any Award granted under the Plan, and the terms and
conditions of the related agreements that will be entered into with

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participants. As to the selection of and grant of Awards to participants who are not executive
officers of the Company or any Subsidiary or Affiliate, or Section 16 Participants, the Committee
may delegate its responsibilities to members of the Company’s management in any manner consistent
with applicable law.

     The Committee shall have the authority to adopt, alter and repeal such rules, guidelines and
practices governing the Plan as it shall, from time to time, deem advisable; to interpret the terms
and provisions of the Plan and any Award issued under the Plan (and any agreement relating
thereto); to direct employees of the Company or other advisors to prepare such materials or perform
such analyses as the Committee deems necessary or appropriate; and otherwise to supervise the
administration of the Plan.

     Any interpretation or administration of the Plan by the Committee, and all actions and
determinations of the Committee, shall be final, binding and conclusive on the Company, its
shareholders, Subsidiaries, Affiliates, all participants in the Plan, their respective legal
representatives, successors and assigns, and all persons claiming under or through any of them. No
member of the Board or of the Committee shall incur any liability for any action taken or omitted,
or any determination made, in good faith in connection with the Plan.

SECTION 3. SHARES SUBJECT TO THE PLAN.

     (a) Aggregate Shares Subject to the Plan. Subject to adjustment as provided in Section 3(c),
the total number of Shares reserved and available for Awards under the Plan is 3,100,000. Any
Shares issued hereunder may consist, in whole or in part, of authorized and unissued shares or
treasury shares.

     (b) Forfeiture or Termination of Awards of Shares. If any Shares subject to any Award granted
hereunder are forfeited or an Award otherwise terminates or expires without the issuance of Shares,
the Shares subject to that Award shall again be available for distribution in connection with
future Awards under the Plan as set forth in Section 3(a), unless the participant who had been
awarded those forfeited Shares or the expired or terminated Award has theretofore received
dividends or other benefits of ownership with respect to those Shares. For purposes hereof, a
participant shall not be deemed to have received a benefit of ownership with respect to those
Shares by the exercise of voting rights, or by the accumulation of dividends that are not realized
because of the forfeiture of those Shares or the expiration or termination of the related Award
without issuance of those Shares.

     (c) Adjustment. In the event of any merger, reorganization, consolidation, recapitalization,
share dividend, share split, combination of shares or other change in corporate structure of the
Company affecting the Shares, such substitution or adjustment shall be made in the aggregate number
of Shares reserved for issuance under the Plan, in the number and option price of Shares subject to
outstanding options granted under the Plan, in the number and purchase price of Shares subject to
outstanding Share Purchase Rights granted under the Plan, in the number of Share Appreciation
Rights granted under the Plan, in the number of underlying Shares any Dividend Equivalent Rights
granted under the Plan will be based on, and in the number of Shares subject to Restricted Share
Awards, Deferred Share Awards and any other outstanding Awards granted under the Plan as may be
approved by the Committee, in its sole

- 4 -

 

discretion, but the number of Shares subject to any Award shall always be a whole number. Any
fractional Shares shall be eliminated.

     (d) Annual Award Limit. No participant may be granted Stock Options or other Awards under the
Plan with respect to an aggregate of more than 500,000 Shares (subject to adjustment as provided in
Section 3(c) hereof) during any calendar year.

SECTION 4. ELIGIBILITY.

     Grants may be made from time to time to those officers, employees and directors of the Company
who are designated by the Committee in its sole and exclusive discretion. Eligible persons may
include, but shall not necessarily be limited to, officers and directors of the Company and any
Subsidiary or Affiliate; however, Stock Options intended to qualify as Incentive Stock Options
shall be granted only to eligible persons while actually employed by the Company, a Subsidiary or
an Affiliate. The Committee may grant more than one Award to the same eligible person. No Award
shall be granted to any eligible person during any period of time when such eligible person is on a
leave of absence. Awards to be granted to directors, which may include members of the Committee,
must be approved and granted by the members of the Board who are Non-Employee Directors.

SECTION 5. STOCK OPTIONS.

     (a) Grant. Stock Options may be granted alone, in addition to or in tandem with other Awards
granted under the Plan or cash awards made outside the Plan. The Committee shall determine the
individuals to whom, and the time or times at which, grants of Stock Options will be made, the
number of Shares purchasable under each Stock Option, and the other terms and conditions of the
Stock Options in addition to those set forth in Sections 5(b) and 5(c). Any Stock Option granted
under the Plan shall be in such form as the Committee may from time to time approve.

     Stock Options granted under the Plan may be of two types which shall be indicated on their
face: (i) Incentive Stock Options and (ii) Non-Qualified Stock Options. Subject to Section 5(c),
the Committee shall have the authority to grant to any participant Incentive Stock Options,
Non-Qualified Stock Options or both types of Stock Options.

     (b) Terms and Conditions. Options granted under the Plan shall be evidenced by an agreement
(“Option Agreements”), shall be subject to the following terms and conditions and shall contain
such additional terms and conditions, not inconsistent with the terms of the Plan, as the Committee
shall deem desirable:

     (1) Option Price. The option price per share of Shares purchasable under a
Non-Qualified Stock Option or an Incentive Stock Option shall be determined by the Committee
at the time of grant and shall be not less than 100% of the Fair Market Value of the Shares
at the date of grant (or, with respect to an Incentive Stock Option, 110% of the Fair Market
Value of the Shares at the date of grant in the case of a participant who at the date of
grant owns Shares possessing more than 10% of the total combined voting power of all classes
of stock of the Company or its parent or Subsidiary corporations (as determined under
Sections 424(d), (e) and (f) of the Code)).

- 5 -

 

     (2) Option Term. The term of each Stock Option shall be determined by the Committee and
may not exceed ten years from the date the Option is granted (or, with respect to an
Incentive Stock Option, five years in the case of a participant who at the date of grant
owns Shares possessing more than 10% of the total combined voting power of all classes of
stock of the Company or its parent or Subsidiary corporations (as determined under Sections
424(d), (e) and (f) of the Code)).

     (3) Exercise. Stock Options shall be exercisable at such time or times and shall be
subject to such terms and conditions as shall be determined by the Committee at or after
grant; but, except as provided in Section 5(b)(6) and Section 13, unless otherwise
determined by the Committee at or after grant, no Stock Option shall be exercisable prior to
six months and one day following the date of grant. If any Stock Option is exercisable only
in installments or only after specified exercise dates, the Committee may waive, in whole or
in part, such installment exercise provisions, and may accelerate any exercise date or
dates, at any time at or after grant, based on such factors as the Committee shall determine
in its sole discretion.

     (4) Method of Exercise. Subject to any installment exercise provisions that apply with
respect to any Stock Option, and the six month and one day holding period set forth in
Section 5(b)(3), a Stock Option may be exercised in whole or in part, at any time during the
Option period, by the holder thereof giving to the Company written notice of exercise
specifying the number of Shares to be purchased.

     That notice shall be accompanied by payment in full of the Option price of the Shares
for which the Option is exercised, in cash or Shares or by check or such other instrument as
the Committee may accept. The value of each such Share surrendered or withheld shall be 100%
of the Fair Market Value of the Shares on the date the option is exercised.

     No Shares shall be issued on an exercise of an Option until full payment has been made.
Except in connection with the tandem award of Dividend Equivalent Rights, a participant
shall not have rights to dividends or any other rights of a shareholder with respect to any
Shares subject to an Option unless and until the participant has given written notice of
exercise, has paid in full for those Shares, has given, if requested, the representation
described in Section 15(a), and those Shares have been issued to him.

     (5) Non-Transferability of Options. No Stock Option shall be transferable by any
participant other than by will or by the laws of descent and distribution or pursuant to a
qualified domestic relations order (as defined in the Code or the Employment Retirement
Income Security Act of 1974, as amended) except that, if so provided in the Option
Agreement, the participant may transfer the Option, other than an Incentive Stock Option,
during his lifetime to one or more members of his family, to one or more trusts for the
benefit of one or more of his family, or to a partnership or partnerships of members of his
family, or to a charitable organization as defined in Section 501(c)(3) of the Code,
provided that no consideration is paid for the transfer and that the transfer would not
result in the loss of any exemption under Rule 16b-3 of the Exchange Act with respect to any
Option. The transferee of an Option will be subject to all restrictions, terms

- 6 -

 

and conditions applicable to the Option prior to its transfer, except that the Option
will not be further transferable by the transferee other than by will or by the laws of
descent and distribution.

     (6) Termination of Employment

     (i) Termination by Death. Subject to Sections 5(b)(3) and 5(c), if any
participant’s employment with the Company or any Subsidiary or Affiliate terminates
by reason of death, any Stock Option held by that participant shall become
immediately and automatically vested and exercisable. If termination of a
participant’s employment is due to death, then any Stock Option held by that
participant may thereafter be exercised for a period of two years (or with respect
to an Incentive Stock Option, for a period of one year) (or such other period as the
Committee may specify at or after grant) from the date of death. Notwithstanding the
foregoing, in no event will any Stock Option be exercisable after the expiration of
the option period of such Option. The balance of the Stock Option shall be forfeited
if not exercised within two years.

     (ii) Termination by Reason of Disability. Subject to Sections 5(b)(3) and 5(c),
if a participant’s employment with the Company or any Subsidiary or Affiliate
terminates by reason of Disability, any Stock Option held by that participant shall
become immediately and automatically vested and exercisable. If termination of a
participant’s employment is due to Disability, then any Stock Option held by that
participant may thereafter be exercised by the participant or by the participant’s
duly authorized legal representative if the participant is unable to exercise the
Option as a result of the participant’s Disability, for a period of two years (or
with respect to an Incentive Stock Option, for a period of one year) (or such other
period as the Committee may specify at or after grant) from the date of such
termination of employment; and if the participant dies within that two year period
(or such other period as the Committee may specify at or after grant), any
unexercised Stock Option held by that participant shall thereafter be exercisable by
the estate of the participant (acting through its fiduciary) for the duration of the
two-year period from the date of that termination of employment. Notwithstanding the
foregoing, in no event will any Stock Option be exercisable after the expiration of
the option period of such Option. The balance of the Stock Option shall be forfeited
if not exercised within two years.

     (iii) Termination for Cause. Unless otherwise determined by the Committee at or
after the time of granting any Stock Option, if a participant’s employment with the
Company or any Subsidiary or Affiliate terminates for Cause, any unvested Stock
Options will be forfeited and terminated immediately upon termination and any vested
Stock Options held by that participant shall terminate 30 days after the date
employment terminates. Notwithstanding the foregoing, in no event will any Stock
Option be exercisable after the expiration of the option period of such Option. The
balance of the Stock Option shall be forfeited.

- 7 -

 

     (iv) Other Termination. Unless otherwise determined by the Committee at or
after the time of granting any Stock Option, if a participant’s employment with the
Company or any Subsidiary or Affiliate terminates for any reason other than death,
Disability, or for Cause all Stock Options held by that participant shall terminate
three months after the date employment terminates. Notwithstanding the foregoing,
in no event will any Stock Option be exercisable after the expiration of the option
period of such Option. The balance of the Stock Option shall be forfeited.

     (v) Leave of Absence. In the event a participant is granted a leave of absence
by the Company or any Subsidiary or Affiliate to enter military service or because
of sickness, his employment with the Company or such Subsidiary or Affiliate will
not be considered terminated, and he shall be deemed an employee of the Company or
such Subsidiary or Affiliate during such leave of absence or any extension thereof
granted by the Company or such Subsidiary or Affiliate. Notwithstanding the
foregoing, in the case of an Incentive Stock Option, a leave of absence of more than
90 days will be viewed as a termination of employment unless continued employment is
guaranteed by contract or statute.

     (c) Incentive Stock Options. Notwithstanding Sections 5(b)(5) and (6), an Incentive Stock
Option shall be exercisable by (i) a participant’s authorized legal representative (if the
participant is unable to exercise the Incentive Stock Option as a result of the participant’s
Disability) only if, and to the extent, permitted by Section 422 of the Code and (ii) by the
participant’s estate, in the case of death, or authorized legal representative, in the case of
Disability, no later than 10 years from the date the Incentive Stock Option was granted (in
addition to any other restrictions or limitations that may apply). Anything in the Plan to the
contrary notwithstanding, no term or provision of the Plan relating to Incentive Stock Options
shall be interpreted, amended or altered, nor shall any discretion or authority granted under the
Plan be exercised, so as to disqualify the Plan under Section 422 of the Code, or, without the
consent of the participants affected, to disqualify any Incentive Stock Option under that Section
422 or any successor Section thereto.

     (d) Buyout Provisions. The Committee may at any time buy out for a payment in cash, Shares,
Deferred Shares or Restricted Shares an Option previously granted, based on such terms and
conditions as the Committee shall establish and agree upon with the participant, but no such
transaction involving a Section 16 Participant shall be structured or effected in a manner that
would result in any liability on the part of the participant under Section 16(b) of the Exchange
Act or the rules and regulations promulgated thereunder.

     (e) Certain Reissuance of Stock Options. To the extent Common Shares are surrendered by a
participant in connection with the exercise of a Stock Option in accordance with Section 5(b), the
Committee may, in its sole discretion, grant new Stock Options to such participant (to the extent
Common Shares remain available for Awards), subject to the following terms and conditions:

     (1) The number of Common Shares shall be equal to the number of Common Shares being
surrendered by the participant;

- 8 -

 

     (2) The option price per Common Share shall be equal to the Fair Market Value of Common
Shares, determined on the date of exercise of the Stock Options whose exercise caused such
Award; and

     (3) The terms and conditions of such Stock Options shall in all other respects
replicate such terms and conditions of the Stock Options whose exercise caused such Award,
except to the extent such terms and conditions are determined to not be wholly consistent
with the general provisions of this Section 5, or in conflict with the remaining provisions
of this Plan.

SECTION 6. SHARE APPRECIATION RIGHTS.

     (a) Grant. Share Appreciation Rights may be granted in connection with all or any part of an
Option, either concurrently with the grant of the Option or, if the Option is a Non-Qualified Stock
Option, by an amendment to the Option at any time thereafter during the term of the Option. Share
Appreciation Rights may be exercised in whole or in part at such times under such conditions as may
be specified by the Committee in the participant’s Option Agreement.

     (b) Terms and Conditions. The following terms and conditions will apply to all Share
Appreciation Rights that are granted in connection with Options:

     (1) Rights. Share Appreciation Rights shall entitle the participant, upon exercise of
all or any part of the Share Appreciation Rights, to surrender to the Company, unexercised,
that portion of the underlying Option relating to the same number of Shares as is covered by
the Share Appreciation Rights (or the portion of the Share Appreciation Rights so exercised)
and to receive in exchange from the Company an amount equal to the excess of (x) the Fair
Market Value, on the date of exercise, of the Shares covered by the surrendered portion of
the underlying Option over (y) the exercise price of the Shares covered by the surrendered
portion of the underlying Option. The Committee may limit the amount that the participant
will be entitled to receive upon exercise of the Share Appreciation Right.

     (2) Surrender of Option. Upon the exercise of the Share Appreciation Right and
surrender of the related portion of the underlying Option, the Option, to the extent
surrendered, will not thereafter be exercisable. The underlying Option may provide that such
Share Appreciation Rights will be payable solely in cash. The terms of the underlying Option
shall provide a method by which an alternative fair market value of the Shares on the date
of exercise shall be calculated based on one of the following: (x) the closing price of the
Shares on the national exchange on which they are then traded on the business day
immediately preceding the day of exercise; (y) the highest closing price of the Shares on
the national exchange on which they have been traded during the 90 days immediately
preceding the Change in Control; or (z) the greater of (x) and (y).

     (3) Exercise. In addition to any further conditions upon exercise that may be imposed
by the Committee, the Share Appreciation Rights shall be exercisable only to the extent that
the related Option is exercisable, except that in no event will a Share Appreciation Right
held by a Section 16 Participant be exercisable within the first six

- 9 -

 

months after it is awarded even though the related Option is or becomes exercisable,
and each Share Appreciation Right will expire no later than the date on which the related
Option expires. A Share Appreciation Right may be exercised only at a time when the Fair
Market Value of the Shares covered by the Share Appreciation Right exceeds the exercise
price of the Shares covered by the underlying Option.

     (4) Method of Exercise. Share Appreciation Rights may be exercised by the participant
giving written notice of the exercise to the Company, stating the number of Share
Appreciation Rights the participant has elected to exercise and surrendering the portion of
the underlying Option relating to the same number of Shares as the number of Share
Appreciation Rights elected to be exercised.

     (5) Payment. The manner in which the Company’s obligation arising upon the exercise of
the Share Appreciation Right will be paid will be determined by the Committee and shall be
set forth in the participant’s Option Agreement. The Committee may provide for payment in
Shares or cash, or a fixed combination of Shares or cash, or the Committee may reserve the
right to determine the manner of payment at the time the Share Appreciation Right is
exercised. Shares issued upon the exercise of a Share Appreciation Right will be valued at
their Fair Market Value on the date of exercise.

SECTION 7. RESTRICTED SHARES.

     (a) Grant. Restricted Shares may be issued alone, in addition to or in tandem with other
Awards under the Plan or cash awards made outside the Plan. The Committee shall determine the
individuals to whom, and the time or times at which, grants of Restricted Shares will be made, the
number of Restricted Shares to be awarded to each participant, the price (if any) to be paid by the
participant (subject to Section 7(b)), the date or dates upon which Restricted Share Awards will
vest, the period or periods within which those Restricted Share Awards may be subject to
forfeiture, and the other terms and conditions of those Awards in addition to those set forth in
Section 7(b).

     The Committee may condition the grant of Restricted Shares upon the attainment of specified
performance goals or such other factors as the Committee may determine in its sole discretion.

     (b) Terms and Conditions. Restricted Shares awarded under the Plan shall be subject to the
following terms and conditions and such additional terms and conditions, not inconsistent with the
provisions of the Plan, as the Committee shall deem desirable. A participant who receives a
Restricted Share Award shall not have any rights with respect to that Award, unless and until the
participant has executed an agreement evidencing the Award in the form approved from time to time
by the Committee, has delivered a fully executed copy thereof to the Company, and has otherwise
complied with the applicable terms and conditions of that Award.

     (1) The purchase price (if any) for Restricted Shares shall be determined by the
Committee at the time of grant.

- 10 -

 

     (2) Awards of Restricted Shares must be accepted by executing a Restricted Share Award
agreement and paying the price (if any) that is required under Section 7(b)(1).

     (3) Each participant receiving a Restricted Share Award shall be issued a stock
certificate in respect of those Restricted Shares. The certificate shall be registered in
the name of the participant and shall bear an appropriate legend referring to the terms,
conditions and restrictions applicable to the Award.

     (4) The Committee shall require that the stock certificates evidencing the Restricted
Shares be held in custody by the Company until the restrictions thereon shall have lapsed,
and that, as a condition of any Restricted Shares Award, the participant shall have
delivered to the Company a stock power, endorsed in blank, relating to the Shares covered by
that Award.

     (5) Subject to the provisions of this Plan and the Restricted Share Award agreement,
during a period set by the Committee commencing with the date of any Award (the “Restriction
Period”), the participant shall not be permitted to sell, transfer, pledge, assign or
otherwise encumber the Restricted Shares covered by that Award. The Restriction Period shall
not be less than three years in duration (“Minimum Restriction Period”) unless otherwise
determined by the Committee at the time of grant. Subject to these limitations and the
Minimum Restriction Period requirement, the Committee, in its sole discretion, may provide
for the lapse of restrictions in installments and may accelerate or waive restrictions, in
whole or in part, based on service, performance or such other factors and criteria as the
Committee may determine in its sole discretion.

     (6) Except as provided in this Section 7(b)(6) and Section 7(b)(5) and Section 7(b)(7),
the participant shall have, with respect to the Restricted Shares awarded, all of the rights
of a shareholder of the Company, including the right to vote the Shares and the right to
receive any dividends. The Committee, in its sole discretion, as determined at the time of
Award, may permit or require the payment of cash dividends to be deferred and subject to
forfeiture and, if the Committee so determines, reinvested, subject to Section 14(f), in
additional Restricted Shares to the extent Shares are available under Section 3, or
otherwise reinvested. Unless the Committee or Board determines otherwise, Share dividends
issued with respect to Restricted Shares shall be treated as additional Restricted Shares
that are subject to the same restrictions and other terms and conditions that apply to the
Shares with respect to which such dividends are issued.

     (7) No Restricted Shares shall be transferable by a participant other than by will or
by the laws of descent and distribution or pursuant to a qualified domestic relations order
(as defined in the Code or the Employment Retirement Income Security Act of 1974, as
amended) except that, if so provided in the Restricted Shares Agreement, the participant may
transfer the Restricted Shares, during his lifetime to one or more members of his family, to
one or more trusts for the benefit of one or more of his family, to a partnership or
partnerships of members of his family, or to a charitable organization as defined in Section
501(c)(3) of the Code, provided that no consideration is paid for the transfer and that the
transfer would not result in the loss of any exemption under Rule

- 11 -

 

16b-3 of the Exchange Act with respect to any Restricted Shares. The transferee of
Restricted Shares will be subject to all restrictions, terms and conditions applicable to
the Restricted Shares prior to its transfer, except that the Restricted Shares will not be
further transferable by the transferee other than by will or by the laws of descent and
distribution.

     (8) Unless otherwise determined by the Committee at or after the time of granting any
Restricted Shares, if a participant’s employment with the Company or any Subsidiary or
Affiliate terminates by reason of death, any Restricted Shares held by that participant
shall thereafter vest and any restriction shall lapse.

     (9) Unless otherwise determined by the Committee at or after the time of granting any
Restricted Shares, if a participant’s employment with the Company or any Subsidiary or
Affiliate terminates by reason of Disability, any Restricted Shares held by that participant
shall thereafter vest and any restriction shall lapse.

     (10) Unless otherwise determined by the Committee at or after the time of granting any
Restricted Shares, if a participant’s employment with the Company or any Subsidiary or
Affiliate terminates for any reason other than death or Disability, the Restricted Shares
held by that participant that are unvested or subject to restriction at the time of
termination shall thereupon be forfeited.

     (c) Minimum Value. In order to better ensure that Award payments actually reflect the
performance of the Company and service of the participant, the Committee may provide, in its sole
discretion, for a tandem performance-based or other award designed to guarantee a minimum value,
payable in cash or Shares, to the recipient of a Restricted Share Award, subject to such
performance, future service, deferral and other terms and conditions as may be specified by the
Committee.

SECTION 8. DEFERRED SHARES.

     (a) Grant. Deferred Shares may be awarded alone, in addition to or in tandem with other Awards
granted under the Plan or cash awards made outside the Plan. The Committee shall determine the
individuals to whom, and the time or times at which, Deferred Shares shall be awarded, the number
of Deferred Shares to be awarded to any participant, the duration of the period (the “Deferral
Period”) during which, and the conditions under which, receipt of the Shares will be deferred, and
the other terms and conditions of the Award in addition to those set forth in Section 8(b).

     The Committee may condition the grant of Deferred Shares upon the attainment of specified
performance goals or such other factors as the Committee shall determine in its sole discretion.

     (b) Terms and Conditions. Deferred Share Awards shall be subject to the following terms and
conditions and shall contain such additional terms and conditions, not inconsistent with the terms
of the Plan, as the Committee shall deem desirable:

     (1) The purchase price for Deferred Shares shall be determined at the time of grant by
the Committee. Subject to the provisions of the Plan and the Award agreement

- 12 -

 

referred to in Section 8(b)(9), Deferred Share Awards may not be sold, assigned,
transferred, pledged or otherwise encumbered during the Deferral Period. At the expiration
of the Deferral Period (or the Elective Deferral Period referred to in Section 8(b)(8),
where applicable), stock certificates shall be delivered to the participant, or the
participant’s legal representative, for the Shares covered by the Deferred Share Award. The
Deferral Period applicable to any Deferred Share Award shall not be less than six months and
one day (“Minimum Deferral Period”).

     (2) Unless otherwise determined by the Committee at grant, amounts equal to any
dividends declared during the Deferral Period with respect to the number of Shares covered
by a Deferred Share Award will be paid to the participant currently, or deferred and deemed
to be reinvested in additional Deferred Shares, or otherwise reinvested, all as determined
by the Committee, in its sole discretion, at or after the time of the Award.

     (3) No Deferred Shares shall be transferable by a participant other than by will or by
the laws of descent and distribution or pursuant to a qualified domestic relations order (as
defined in the Code or the Employment Retirement Income Security Act of 1974, as amended)
except that, if so provided in the Deferred Shares Agreement, the participant may transfer
the Deferred Shares during his lifetime to one or more members of his family, to one or more
trusts for the benefit of one or more of his family, to a partnership or partnerships of
members of his family, or to a charitable organization as defined in Section 501(c)(3) of
the Code, provided that no consideration is paid for the transfer and that the transfer
would not result in the loss of any exemption under Rule 16b-3 of the Exchange Act with
respect to any Deferred Shares. The transferee of Deferred Shares will be subject to all
restrictions, terms and conditions applicable to the Deferred Shares prior to its transfer,
except that the Deferred Shares will not be further transferable by the transferee other
than by will or by the laws of descent and distribution.

     (4) Unless otherwise determined by the Committee at or after the time of granting any
Deferred Shares, if a participant’s employment by the Company or any Subsidiary or Affiliate
terminates by reason of death, any Deferred Shares held by such participant shall thereafter
vest or any restriction shall lapse.

     (5) Unless otherwise determined by the Committee at or after the time of granting any
Deferred Shares, if a participant’s employment by the Company or any Subsidiary or Affiliate
terminates by reason of Disability, any Deferred Shares held by such participant shall
thereafter vest or any restriction lapse.

     (6) Unless otherwise determined by the Committee at or after the time of granting any
Deferred Share Award, if a participant’s employment by the Company or any Subsidiary or
Affiliate terminates for any reason other than death or Disability, all Deferred Shares held
by such participant which are unvested or subject to restriction shall thereupon be
forfeited.

     (7) Based on service, performance or such other factors or criteria as the Committee
may determine, the Committee may, at or after grant, accelerate the vesting of all or any
part of any Deferred Share Award or waive a portion of the Deferral Period for

- 13 -

 

all or any part of such Award, subject in all cases to the Minimum Deferral Period
requirement.

     (8) A participant may elect to further defer receipt of a Deferred Share Award (or an
installment of an Award) for a specified period or until a specified event (the “Elective
Deferral Period”), subject in each case to the Committee’s approval and the terms of this
Section 8 and such other terms as are determined by the Committee, all in its sole
discretion. Subject to any exceptions approved by the Committee, such election must be made
at least 12 months prior to completion of the Deferral Period for such Deferred Share Award
(or such installment).

     (9) Each such Award shall be confirmed by, and subject to the terms of, a Deferred
Share Award agreement evidencing the Award in the form approved from time to time by the
Committee.

     (c) Minimum Value Provisions. In order to better ensure that Award payments actually reflect
the performance of the Company and service of the participant, the Committee may provide, in its
sole discretion, for a tandem performance-based or other Award designed to guarantee a minimum
value, payable in cash or Shares to the recipient of a Deferred Share Award, subject to such
performance, future service, deferral and other terms and conditions as may be specified by the
Committee.

SECTION 9. SHARE PURCHASE RIGHTS.

     (a) Grant. Share Purchase Rights may be granted alone, in addition to or in tandem with other
Awards granted under the Plan or cash awards made outside the Plan. The Committee shall determine
the individuals to whom, and the time or times at which, grants of Share Purchase Rights will be
made, the number of Shares which may be purchased pursuant to the Share Purchase Rights, and the
other terms and conditions of the Share Purchase Rights in addition to those set forth in Section
9(b). The Shares subject to the Share Purchase Rights may be purchased, as determined by the
Committee at the time of grant:

     (1) at the Fair Market Value of such Shares on the date of grant; or

     (2) at 85% of the Fair Market Value of such Shares on the date of grant if the grant of
Share Purchase Rights is made in lieu of cash compensation.

     Subject to Section 9(b) hereof, the Committee may also impose such deferral, forfeiture or
other terms and conditions as it shall determine, in its sole discretion, on such Share Purchase
Rights or the exercise thereof. Each Share Purchase Right Award shall be confirmed by, and be
subject to the terms of, a Share Purchase Rights Agreement which shall be in form approved by the
Committee.

     (b) Terms and Conditions. Share Purchase Rights may contain such additional terms and
conditions not inconsistent with the terms of the Plan as the Committee shall deem desirable, and
shall generally be exercisable for such period as shall be determined by the Committee. However,
Share Purchase Rights granted to Section 16 Participants shall not become exercisable

- 14 -

 

earlier than six months and one day after the grant date. Share Purchase Rights shall not be
transferable by a participant other than by will or by the laws of descent and distribution.

SECTION 10. OTHER SHARE-BASED AWARDS.

     (a) Grant. Other Awards of Shares and other Awards that are valued, in whole or in part, by
reference to, or are otherwise based on, Shares, including, without limitation, performance shares,
convertible preferred shares, convertible debentures, exchangeable securities, dividend equivalent
rights and Share Awards or options valued by reference to Book Value or Subsidiary performance, may
be granted alone, in addition to or in tandem with other Awards granted under the Plan or cash
awards made outside the Plan.

     At the time the Shares or Other Share-Based Awards are granted, the Committee shall determine
the individuals to whom and the time or times at which such Shares or Other Share-Based Awards
shall be awarded, the number of Shares to be used in computing an Award or which are to be awarded
pursuant to such Awards, the consideration, if any, to be paid for such Shares or Other Share-Based
Awards, and all other terms and conditions of the Awards in addition to those set forth in Section
10(b). The Committee will also have the right, at its sole discretion, to settle such Awards in
Shares, Restricted Shares or cash in an amount equal to then value of the Shares or Other
Share-Based Awards.

     The provisions of Other Share-Based Awards need not be the same with respect to each
participant.

     (b) Terms and Conditions. Other Share-Based Awards shall be subject to the following terms and
conditions and shall contain such additional terms and conditions, not inconsistent with the terms
of the Plan, as the Committee shall deem desirable:

     (1) Subject to the provisions of this Plan and the Award agreement referred to in
Section 10(b)(5) below, Shares awarded or subject to Awards made under this Section 10 may
not be sold, assigned, transferred, pledged or otherwise encumbered prior to the date on
which the Shares are issued, or, if later, the date on which any applicable restriction,
performance, holding or deferral period or requirement is satisfied or lapses. All Shares or
Other Share-Based Awards granted under this Section 10 shall be subject to a minimum holding
period (including any applicable restriction, performance and/or deferral periods) of six
months and one day (“Minimum Holding Period”).

     (2) Subject to the provisions of this Plan and the Award agreement and unless otherwise
determined by the Committee at the time of grant, the recipient of an Other Share-Based
Award shall be entitled to receive, currently or on a deferred basis, interest or dividends
or interest or dividend equivalents with respect to the number of Shares covered by the
Award, as determined at the time of the Award by the Committee, in its sole discretion, and
the Committee may provide that such amounts (if any) shall be deemed to have been reinvested
in additional Shares or otherwise reinvested.

     (3) Subject to the Minimum Holding Period, any Other Share-Based Award and any Shares
covered by any such Award shall vest or be forfeited to the extent, at the

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times and subject to the conditions, if any, provided in the Award agreement, as
determined by the Committee in its sole discretion.

     (4) In the event of the participant’s Disability or death, or in cases of special
circumstances, the Committee may, in its sole discretion, waive, in whole or in part, any or
all of the remaining limitations imposed hereunder or under any related Award agreement (if
any) with respect to any part or all of any Award under this Section 10, provided that the
Minimum Holding Period requirement may not be waived, except in case of a participant’s
death.

     (5) Each Award shall be confirmed by, and subject to the terms of, an agreement or
other instrument evidencing the Award in the form approved from time to time by the
Committee, the Company and the participant.

     (6) Shares (including securities convertible into Shares) issued on a bonus basis under
this Section 10 shall be issued for no cash consideration. Shares (including securities
convertible into Shares) purchased pursuant to a purchase right awarded under this Section
10 shall bear a price of at least 85% of the Fair Market Value of the Shares on the date of
grant. The purchase price of such Shares, and of any Other Share-Based Award granted
hereunder, or the formula by which such price is to be determined, shall be fixed by the
Committee at the time of grant.

     (7) In the event that any “derivative security,” as defined in Rule 16a-1(c) (or any
successor thereto) promulgated by the Securities and Exchange Commission under Section 16 of
the Exchange Act, is awarded pursuant to this Section 10 to any Section 16 Participant, such
derivative security shall not be transferable other than by will or by the laws of descent
and distribution.

     (c) Dividend Equivalent Rights. A Dividend Equivalent Right is an Award entitling the
recipient to receive credits based on cash distributions that would have been paid on the Shares
specified in the Dividend Equivalent Right (or other award to which it relates) if such Shares had
been issued to and held by the recipient. A Dividend Equivalent Right may be granted hereunder to
any participant as a component of another Award or as a freestanding award.

     (1) Terms And Conditions. In addition to the terms and conditions set forth in Section
10(b), Dividend Equivalent Rights shall be subject to the following additional terms and
conditions. Dividend Equivalents credited to the holder of a Dividend Equivalent Right may
be paid currently or may be deemed to be reinvested in additional Shares, which may
thereafter accrue additional equivalents. Any such reinvestment shall be at Fair Market
Value on the date of reinvestment. Dividend Equivalent Rights may be settled in cash or
Shares or a combination thereof, in a single installment or installments, all determined in
the sole discretion of the Committee. A Dividend Equivalent Right granted as a component of
another Award may provide that such Dividend Equivalent Right shall be settled upon
exercise, settlement, or payment of, or lapse of restrictions on, such other award, and that
such Dividend Equivalent Right shall expire or be forfeited or annulled under the same
conditions as such other award. A Dividend Equivalent Right

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granted as a component of another Award may also contain terms and conditions different
from such other Award.

     (2) Interest Equivalents. Any Award under this Plan that is settled in whole or in part
in cash on a deferred basis may provide in the Award Agreement for interest equivalents to
be credited with respect to such cash payment. Interest equivalents may be compounded and
shall be paid upon such terms and conditions as may be specified by the grant.

     (3) Termination of Employment. Except as may otherwise be provided by the Committee
either in the Award Agreement or in writing after the Award Agreement is issued, a
participant’s rights in all Dividend Equivalent Rights or interest equivalents (other than
any accrued but unpaid Dividend Equivalent Rights or interest equivalents) shall
automatically terminate upon the date that a participant’s employment with the Company or
any Subsidiary or Affiliate terminates for any reason other than death or Disability. Any
accrued but unpaid Dividend Equivalent Rights or interest equivalents shall be paid by the
Company within three months after the termination of the participant’s employment with the
Company or any Subsidiary or Affiliate.

SECTION 11. FORM AND TIMING OF PAYMENT UNDER AWARDS; DEFERRALS.

     Subject to the terms of the Plan and any applicable Award Agreement, payments to be made by
the Company, a Subsidiary or Affiliate upon the exercise of an Option or other Award or settlement
of an Award may be made in such forms as the Committee shall determine, including, without
limitation, cash, Shares, other Awards or other property, and may be made in a single payment or
transfer, in installments, or on a deferred basis. The settlement of any Award may be accelerated,
and cash paid in lieu of Shares in connection with such settlement, in the discretion of the
Committee or upon occurrence of one or more specified events. Installment or deferred payments may
be required by the Committee or permitted at the election of the participant on terms and
conditions established by the Committee. Payments may include, without limitation, provisions for
the payment or crediting of a reasonable interest rate on installment or deferred payments or the
grant or crediting of Dividend Equivalents or other amounts in respect of installment or deferred
payments denominated in Shares.

SECTION 12. CHANGE IN CONTROL PROVISION.

     (a) Impact of Event. The provisions of this Section 12(a) shall apply to an Award only as
provided for in an applicable Award agreement. With respect to each participant under the Plan, in
the event the participant’s employment with the Company, any Subsidiary or any Affiliate, as
applicable, is terminated without Cause within a specified time period (as provided for in the
applicable Award agreement) following (i) a “Change in Control” as defined in Section 12(b) or (ii)
a “Potential Change in Control” as defined in Section 12(c), then the following provisions shall
apply with respect to such participant:

     (1) Any Stock Options awarded under the Plan not previously exercisable and vested
shall become fully exercisable and vested;

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     (2) Any Share Appreciation Rights shall become immediately exercisable; and

     (3) The restrictions applicable to any Restricted Share Awards, Deferred Shares, Share
Purchase Rights and Other Share-Based Awards shall lapse and such Shares and Awards shall be
deemed fully vested.

     Notwithstanding the provisions of Sections 12(a)(l) through (3), the acceleration of
exercisability or lapse of restrictions with respect to Awards granted to any Section 16
Participant which have been held by such participant for less than six months and one day as of the
date that such Change in Control or Potential Change in Control is determined to have occurred must
be approved by the Committee or the Board.

     (b) Definition of Change in Control. For purposes of Section 12(a), a “Change in Control”
means the occurrence of any of the following: (i) the Board or shareholders of the Company approve
a consolidation or merger in which the Company is not the surviving corporation, the sale of
substantially all of the assets of the Company, or the liquidation or dissolution of the Company;
(ii) any person or other entity (other than the Company or a Subsidiary or any Company employee
benefit plan (including any trustee of any such plan acting in its capacity as trustee)) purchases
any Shares (or securities convertible into Shares) pursuant to a tender or exchange offer without
the prior consent of the Board of Directors, or becomes the beneficial owner of securities of the
Company representing 30% or more of the voting power of the Company’s outstanding securities
without the prior consent of the Board; or (iii) during any two-year period, individuals who at the
beginning of such period constitute the entire Board of Directors cease to constitute a majority of
the Board of Directors, unless the election or the nomination for election of each new director is
approved by at least two-thirds of the directors then still in office who were directors at the
beginning of that period.

     (c) Definition of Potential Change in Control. For purposes of Section 12(a), a “Potential
Change in Control” means the happening of any one of the following:

     (1) The approval by the shareholders of the Company of an agreement by the Company, the
consummation of which would result in a Change in Control of the Company as defined in
Section 12(b); or

     (2) The acquisition of beneficial ownership, directly or indirectly, by any entity,
person or group (other than the Company or a Subsidiary or any Company employee benefit plan
(including any trustee of any such plan acting in its capacity as trustee)) of securities of
the Company representing 5% or more of the combined voting power of the Company’s
outstanding securities and the adoption by the Board of a resolution to the effect that a
Potential Change in Control of the Company has occurred for purposes of this Plan.

SECTION 13. AMENDMENTS AND TERMINATION.

     The Board may at any time, in its sole discretion, amend, alter or discontinue the Plan, but
no such amendment, alteration or discontinuation shall be made that would impair the rights of a
participant under an Award theretofore granted, without the participant’s consent. The

- 18 -

 

Company shall submit to the shareholders of the Company, for their approval, any amendments to
the Plan required pursuant to Section 162(m) of the Code or that would materially increase the
benefits accruing to participants under the Plan or the number of Shares subject to the Plan so
long as such approval is required by law or regulation (including any applicable regulation of an
exchange on which the Shares are traded).

     The Committee may at any time, in its sole discretion, amend the terms of any Award, but no
such amendment shall be made that would impair the rights of a participant under an Award
theretofore granted, without the participant’s consent; nor shall any such amendment be made that
would make the applicable exemptions provided by Rule 16b-3 under the Exchange Act unavailable to
any Section 16 Participant holding the Award without the participant’s consent.

     Subject to the above provisions, the Board shall have all necessary authority to amend the
Plan, clarify any provision or to take into account changes in applicable securities and tax laws
and accounting rules, as well as other developments.

SECTION 14. UNFUNDED STATUS OF PLAN.

     The Plan is intended to constitute an “unfunded” plan for incentive and deferred compensation.
With respect to any payment not yet made to a participant by the Company, nothing contained herein
shall give that participant any rights that are greater than those of a general creditor of the
Company.

SECTION 15. GENERAL PROVISIONS.

     (a) The Committee may require each participant acquiring Shares pursuant to an Award under the
Plan to represent to and agree with the Company in writing that the participant is acquiring the
Shares without a view to distribution thereof. The certificates for any such Shares may include
any legend which the Committee deems appropriate to reflect any restrictions on transfer.

     All Shares or other securities delivered under the Plan shall be subject to such stop-transfer
orders and other restrictions as the Committee may deem advisable under the rules, regulations and
other requirements of the Securities and Exchange Commission, any stock exchange upon which the
Shares are then listed, and any applicable federal or state securities laws, and the Committee may
cause a legend or legends to be put on any certificate for any such Shares to make appropriate
reference to those restrictions.

     (b) Nothing contained in this Plan shall prevent the Board from adopting other or additional
compensation arrangements, subject to shareholder approval if such approval is required, and such
arrangements may be either generally applicable or applicable only in specific cases.

     (c) Neither the adoption of the Plan, nor its operation, nor any document describing,
implementing or referring to the Plan, or any part thereof, shall confer upon any participant under
the Plan any right to continue in the employ, or as a director, of the Company or any Subsidiary or
Affiliate, or shall in any way affect the right and power of the Company or any

- 19 -

 

Subsidiary or Affiliate to terminate the employment, or service as a director, of any
participant under the Plan at any time with or without assigning a reason therefor, to the same
extent as the Company or any Subsidiary or Affiliate might have done if the Plan had not been
adopted.

     (d) For purposes of this Plan, a transfer of a participant between the Company and any
Subsidiary or Affiliate shall not be deemed a termination of employment.

     (e) No later than the date as of which an amount first becomes includable in the gross income
of the participant for federal income tax purposes with respect to any Award under the Plan, the
participant shall pay to the Company, or make arrangements satisfactory to the Committee regarding
the payment of, any federal, state or local taxes or other items of any kind required by law to be
withheld with respect to that amount. Subject to the following sentence, unless otherwise
determined by the Committee, withholding obligations may be settled with Shares, including
unrestricted Shares previously owned by the participant or Shares that are part of the Award that
gives rise to the withholding requirement. Notwithstanding the foregoing, any right by a Section 16
Participant to elect to settle any tax withholding obligation with Shares that are part of an Award
must be set forth in the agreement evidencing that Award or be approved by the Committee in its
sole discretion. The obligations of the Company under the Plan shall be conditional on those
payments or arrangements and the Company and its Subsidiaries and Affiliates shall, to the extent
permitted by law, have the right to deduct any such taxes from any payment of any kind otherwise
payable to the participant.

     (f) The actual or deemed reinvestment of dividends or dividend equivalents in additional
Restricted Shares (or in Deferred Shares or other types of Awards) at the time of any dividend
payment shall be permissible only if sufficient Shares are available under Section 3 for
reinvestment (taking into account then outstanding Stock Options).

     (g) The Plan, all Awards made and actions taken thereunder and any agreements relating thereto
shall be governed by and construed in accordance with the laws of the State of Ohio.

     (h) All agreements entered into with participants pursuant to the Plan shall be subject to the
Plan.

     (i) The provisions of Awards need not be the same with respect to each participant.

SECTION 16. SHAREHOLDER APPROVAL; EFFECTIVE DATE OF PLAN.

     The 2002 Developers Diversified Realty Corporation Equity-Based Award Plan was originally
adopted by the Board on February 28, 2002 and was subject to approval by a majority of the holders
of the Company’s outstanding Shares, in accordance with applicable law. The 2002 Developers
Diversified Realty Corporation Equity-Based Award Plan was amended by the Board on June 12, 2009
and June 25, 2009.

SECTION 17. TERM OF PLAN.

     No Award shall be granted pursuant to the Plan on or after February 28, 2012, but Awards
granted prior to that date may extend beyond that date.

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