Document:

exv10w1

 

    Exhibit 10.1

 

 

    1996
    EQUITY PARTICIPATION PLAN

    OF VIASAT, INC.

    

    (As Amended and Restated Effective September 22,
    2010)

 

    ViaSat, Inc., a Delaware corporation, adopted The 1996 Equity
    Participation Plan of ViaSat, Inc. (the “Plan”),
    effective October 24, 1996, for the benefit of its eligible
    employees, consultants and directors. The Plan consists of two
    plans, one for the benefit of key Employees (as such term is
    defined below) and consultants and one for the benefit of
    Independent Directors (as such term is defined below). The
    following is an amendment and restatement of the Plan effective
    as of September 22, 2010, as further amended.

 

    The purposes of this Plan are as follows:

 

    (1) To provide an additional incentive for directors, key
    Employees and consultants to further the growth, development and
    financial success of ViaSat, Inc. (the “Company”) by
    personally benefiting through the ownership of Company stock
    and/or
    rights which recognize such growth, development and financial
    success.

 

    (2) To enable the Company to obtain and retain the services
    of directors, key Employees and consultants considered essential
    to the long range success of the Company by offering them an
    opportunity to own stock in the Company
    and/or
    rights which will reflect the growth, development and financial
    success of the Company.

 

    ARTICLE I.

    

 

    DEFINITIONS
    

 

    1.1 General.  Wherever the
    following terms are used in this Plan they shall have the
    meanings specified below, unless the context clearly indicates
    otherwise.

 

    1.2 Award Limit.  “Award
    Limit” shall mean Five Hundred Thousand (500,000)
    shares of Common Stock with respect to Options or Stock
    Appreciation Rights granted under the Plan and One Hundred Fifty
    Thousand (150,000) shares of Common Stock with respect to awards
    of Restricted Stock, Performance Awards, Dividend Equivalents,
    Restricted Stock Units, or Stock Payments granted under the
    Plan; provided, however, that in connection with
    an individual’s initial service as an Employee, such limit
    will be Three Hundred Thousand (300,000) shares of Common Stock
    with respect to awards of Restricted Stock, Performance Awards,
    Dividend Equivalents, Restricted Stock Units or Stock Payments
    granted under the Plan. The maximum aggregate amount of cash
    that may be paid to an individual in cash during any fiscal year
    of the Company with respect to awards designated to be paid in
    cash shall be $1,000,000.

 

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

 

    1.4 Change in Control.  “Change in
    Control” shall mean a change in ownership or control of
    the Company effected through either of the following
    transactions:

 

    (a) any person or related group of persons (other than the
    Company or a person that directly or indirectly controls, is
    controlled by, or is under common control with, the Company)
    directly or indirectly acquires beneficial ownership (within the
    meaning of Rule
    13d-3 under
    the Exchange Act) of securities possessing more than fifty
    percent (50%) of the total combined voting power of the
    Company’s outstanding securities pursuant to a tender or
    exchange offer made directly to the Company’s stockholders
    which the Board does not recommend such stockholders to
    accept; or

 

    (b) there is a change in the composition of the Board over
    a period of thirty-six (36) consecutive months (or less)
    such that a majority of the Board members (rounded up to the
    nearest whole number) ceases, by reason of one or more proxy
    contests for the election of Board members, to be comprised of

    

    A-1

 

    individuals who either (i) have been Board members
    continuously since the beginning of such period or
    (ii) have been elected or nominated for election as Board
    members during such period by at least a majority of the Board
    members described in clause (i) who were still in office at
    the time such election or nomination was approved by the Board.

 

    1.5 Code.  “Code”
    shall mean the Internal Revenue Code of 1986, as amended.

 

    1.6 Committee.  “Committee”
    shall mean the Compensation Committee of the Board, or another
    committee of the Board, appointed as provided in
    Section 9.1.

 

    1.7 Common Stock.  “Common
    Stock” shall mean the common stock of the Company, par
    value $0.0001 per share, and any equity security of the Company
    issued or authorized to be issued in the future, but excluding
    any preferred stock and any warrants, options or other rights to
    purchase Common Stock. Debt securities of the Company
    convertible into Common Stock shall be deemed equity securities
    of the Company.

 

    1.8 Company.  “Company”
    shall mean ViaSat, Inc., a Delaware corporation.

 

    1.9 Corporate
    Transaction.  “Corporate
    Transaction” shall mean any of the following
    stockholder-approved transactions to which the Company is a
    party:

 

    (a) a merger or consolidation in which the Company is not
    the surviving entity, except for a transaction the principal
    purpose of which is to change the State in which the Company is
    incorporated, form a holding company or effect a similar
    reorganization as to form whereupon this Plan and all Options
    are assumed by the successor entity;

 

    (b) the sale, transfer, exchange or other disposition of
    all or substantially all of the assets of the Company, in
    complete liquidation or dissolution of the Company in a
    transaction not covered by the exceptions to clause (a)
    above; or

 

    (c) any reverse merger in which the Company is the
    surviving entity but in which securities possessing more than
    fifty percent (50%) of the total combined voting power of the
    Company’s outstanding securities are transferred or issued
    to a person or persons different from those who held such
    securities immediately prior to such merger.

 

    1.10 Director.  “Director”
    shall mean a member of the Board.

 

    1.11 Dividend
    Equivalent.  “Dividend
    Equivalent” shall mean a right to receive the
    equivalent value (in cash or Common Stock) of dividends paid on
    Common Stock, awarded under Article VII of this Plan.

 

    1.12 Employee.  “Employee”
    shall mean any officer or other employee (as defined in
    accordance with Section 3401(c) of the Code) of the
    Company, or of any corporation which is a Subsidiary.

 

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

 

    1.14 Exchange
    Act.  “Exchange Act” shall
    mean the Securities Exchange Act of 1934, as amended.

 

    1.15 Fair Market
    Value.  “Fair Market Value”
    of a share of Common Stock as of a given date shall be
    (i) the closing price of a share of Common Stock on the
    principal exchange on which shares of Common Stock are then
    trading or quoted, if any (or as reported on any composite index
    which includes such principal exchange), on such date, or if
    shares were not traded on such date, then on the next following
    date on which a trade occurs, or (ii) if Common Stock is
    not traded on an exchange but is quoted on NASDAQ or a successor
    quotation system, the closing price of a share of Common Stock
    on such date as reported by NASDAQ or such successor quotation
    system; or (iii) if Common Stock is not publicly traded on
    an exchange and not quoted on NASDAQ or a successor quotation
    system, the Fair Market Value of a share of Common Stock as
    established by the Committee (or the Board, in the case of
    awards granted to Independent Directors) acting in good faith.

    

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    1.16 Grantee.  “Grantee”
    shall mean an Employee, Director or consultant granted a
    Performance Award, Dividend Equivalent, Stock Payment or Stock
    Appreciation Right, or an award of Restricted Stock Units, under
    this Plan.

 

    1.17 Incentive Stock
    Option.  “Incentive Stock
    Option” shall mean an option which conforms to the
    applicable provisions of Section 422 of the Code and which
    is designated as an Incentive Stock Option by the Committee.

 

    1.18 Independent
    Director.  “Independent
    Director” shall mean a member of the Board who is not
    an Employee of the Company.

 

    1.19 Non-Qualified Stock
    Option.  “Non-Qualified Stock
    Option” shall mean an Option which is not designated as
    an Incentive Stock Option by the Committee.

 

    1.20 Option.  “Option”
    shall mean a stock option granted under Article III of this
    Plan. An Option granted under this Plan shall, as determined by
    the Committee, be either a Non-Qualified Stock Option or an
    Incentive Stock Option; provided, however, that
    Options granted to Independent Directors and consultants shall
    be Non-Qualified Stock Options.

 

    1.21 Optionee.  “Optionee”
    shall mean an Employee, Director or consultant granted an Option
    under this Plan.

 

    1.22 Performance
    Award.  “Performance Award”
    shall mean a cash bonus, stock bonus or other performance or
    incentive award that is paid in cash, Common Stock or a
    combination of both, awarded under Article VII of this Plan.

 

    1.23 Plan.  “Plan”
    shall mean The 1996 Equity Participation Plan of ViaSat, Inc.

 

    1.24 QDRO.  “QDRO”
    shall mean a qualified domestic relations order as defined by
    the Code or Title I of the Employee Retirement Income
    Security Act of 1974, as amended, or the rules thereunder.

 

    1.25 Restricted
    Stock.  “Restricted Stock”
    shall mean Common Stock awarded under Article VI of this
    Plan.

 

    1.26 Restricted Stock
    Unit.  “Restricted Stock
    Unit” shall mean a right to receive Common Stock
    awarded under Article VII of this Plan.

 

    1.27 Restricted
    Stockholder.  “Restricted
    Stockholder” shall mean an Employee, Director or
    consultant granted an award of Restricted Stock under
    Article VI of this Plan.

 

    1.28 Rule 16b-3.  “Rule 16b-3”
    shall mean that certain
    Rule 16b-3
    under the Exchange Act, as such Rule may be amended from time to
    time.

 

    1.29 Stock Appreciation
    Right.  “Stock Appreciation
    Right” shall mean a stock appreciation right granted
    under Article VIII of this Plan.

 

    1.30 Stock Payment.  “Stock
    Payment” shall mean (i) a payment in the form of
    shares of Common Stock, or (ii) an option or other right to
    purchase shares of Common Stock, as part of a deferred
    compensation arrangement, made in lieu of all or any portion of
    the compensation, including without limitation, salary, bonuses
    and commissions, that would otherwise become payable to a key
    Employee, Director or consultant in cash, awarded under
    Article VII of this Plan.

 

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

 

    1.32 Termination of
    Consultancy.  “Termination of
    Consultancy” shall mean the time when the engagement of
    an Optionee, Grantee or Restricted Stockholder as a consultant
    to the Company or a Subsidiary is terminated for any reason,
    with or without cause, including, but not by way of limitation,
    by resignation, discharge, death or retirement; but excluding
    terminations where there is a simultaneous commencement of

    

    A-3

 

    employment with the Company or any Subsidiary. The Committee, in
    its absolute discretion, shall determine the effect of all
    matters and questions relating to Termination of Consultancy,
    including, but not by way of limitation, the question of whether
    a Termination of Consultancy resulted from a discharge for good
    cause, and all questions of whether particular leaves of absence
    constitute Terminations of Consultancy. Notwithstanding any
    other provision of this Plan, the Company or any Subsidiary has
    an absolute and unrestricted right to terminate a
    consultant’s service at any time for any reason whatsoever,
    with or without cause, except to the extent expressly provided
    otherwise in writing.

 

    1.33 Termination of
    Directorship.  “Termination of
    Directorship” shall mean the time when an Optionee or
    Grantee who is an Independent Director ceases to be a Director
    for any reason, including, but not by way of limitation, a
    termination by resignation, failure to be elected, death or
    retirement. The Board, in its sole and absolute discretion,
    shall determine the effect of all matters and questions relating
    to Termination of Directorship with respect to Independent
    Directors.

 

    1.34 Termination of
    Employment.  “Termination of
    Employment” shall mean the time when the
    employee-employer relationship between an Optionee, Grantee or
    Restricted Stockholder and the Company or any Subsidiary is
    terminated for any reason, with or without cause, including, but
    not by way of limitation, a termination by resignation,
    discharge, death, disability or retirement; but excluding
    (i) terminations where there is a simultaneous reemployment
    or continuing employment of an Optionee, Grantee or Restricted
    Stockholder by the Company or any Subsidiary, (ii) at the
    discretion of the Committee, terminations which result in a
    temporary severance of the employee-employer relationship, and
    (iii) terminations which are followed by the simultaneous
    establishment of a consulting relationship by the Company or a
    Subsidiary with the former employee. The Committee, in its
    absolute discretion, shall determine the effect of all matters
    and questions relating to Termination of Employment, including,
    but not by way of limitation, the question of whether a
    Termination of Employment resulted from a discharge for good
    cause, and all questions of whether particular leaves of absence
    constitute Terminations of Employment. Notwithstanding any other
    provision of this Plan, the Company or any Subsidiary has an
    absolute and unrestricted right to terminate an Employee’s
    employment at any time for any reason whatsoever, with or
    without cause, except to the extent expressly provided otherwise
    in writing.

 

    ARTICLE II.

    

 

    SHARES SUBJECT
    TO PLAN
    

 

    2.1 Shares Subject to Plan.

 

    (a) The shares of stock subject to Options, awards of
    Restricted Stock, Performance Awards, Dividend Equivalents,
    awards of Restricted Stock Units, Stock Payments or Stock
    Appreciation Rights shall be Common Stock, initially shares of
    the Company’s Common Stock, par value $0.0001 per share.
    The aggregate number of such shares which may be issued upon
    exercise of such options or rights or upon any such awards under
    the Plan shall not exceed 17,400,000. The shares of Common Stock
    issuable upon exercise of such options or rights or upon any
    such awards may be either previously authorized but unissued
    shares or treasury shares.

 

    (b) Any shares subject to Options or Stock Appreciation
    Rights shall be counted against the numerical limit of
    Section 2.1(a) as one share for every share subject
    thereto. Any shares subject to awards of Restricted Stock,
    Performance Awards, Dividend Equivalents, awards of Restricted
    Stock Units, or Stock Payments with a per share purchase price
    lower than 100% of Fair Market Value on the date of grant will
    be counted against the numerical limit of Section 2.1(a) as
    2.65 shares for every one share subject thereto. To the
    extent that a share that was subject to an award that counted as
    2.65 shares against the Plan reserve pursuant to the
    preceding sentence is recycled back into the Plan under
    Section 2.2, the Plan will be credited with
    2.65 shares. To the extent that shares are delivered
    pursuant to the exercise of a Stock Appreciation Right, the
    number of underlying shares as to which the exercise related
    shall be counted against the Plan’s share limits set forth
    above, as opposed to only counting the shares actually issued.
    For example, if a Stock Appreciation Right relates to
    100,000 shares and is exercised at a time when the payment
    due to the holder is 50,000 shares, 100,000 shares
    shall be charged against the Plan’s share limits with
    respect to such exercise.

    

    A-4

 

    (c) The maximum number of shares which may be subject to
    awards granted under the Plan to any individual in any fiscal
    year, and the maximum aggregate amount of cash that may be paid
    in cash during any fiscal year with respect to awards designated
    to be paid in cash, shall not exceed the applicable Award Limit.
    To the extent required by Section 162(m) of the Code,
    shares subject to Options which are canceled continue to be
    counted against the Award Limit and if, after grant of an
    Option, the Company stockholders approve an option exchange
    program whereby the price of shares subject to such Option is
    reduced, the transaction is treated as a cancellation of the
    Option and a grant of a new Option and both the Option deemed to
    be canceled and the Option deemed to be granted are counted
    against the Award Limit. Furthermore, to the extent required by
    Section 162(m) of the Code, if, after grant of a Stock
    Appreciation Right, the base amount on which stock appreciation
    is calculated is reduced to reflect a reduction in the Fair
    Market Value of the Company’s Common Stock, the transaction
    is treated as a cancellation of the Stock Appreciation Right and
    a grant of a new Stock Appreciation Right and both the Stock
    Appreciation Right deemed to be canceled and the Stock
    Appreciation Right deemed to be granted are counted against the
    Award Limit.

 

    2.2 Add-Back of Options and Other
    Rights.  If any Option, or other right to
    acquire shares of Common Stock under any other award under this
    Plan, expires or is canceled without having been fully
    exercised, or an award is settled in cash without the delivery
    of shares of Common Stock to the award holder, the number of
    shares subject to such Option or other right but as to which
    such Option or other right was not exercised prior to its
    expiration or cancellation may again be optioned, granted or
    awarded hereunder, subject to the limitations of
    Section 2.1. Furthermore, any shares subject to Options or
    other awards which are adjusted pursuant to Section 10.3
    and become exercisable with respect to shares of stock of
    another corporation shall be considered canceled and may again
    be optioned, granted or awarded hereunder, subject to the
    limitations of Section 2.1. If any share of Restricted
    Stock is forfeited by the Restricted Stockholder or repurchased
    by the Company pursuant to Section 6.6 hereof, such share
    may again be optioned, granted or awarded hereunder, subject to
    the limitations of Section 2.1. Any shares of Common Stock
    tendered or withheld to satisfy (a) the exercise price of
    an Option or (b) the tax withholding obligation pursuant to
    any award may not again be optioned, granted or awarded
    hereunder.

 

    ARTICLE III.

    

 

    GRANTING OF
    OPTIONS
    

 

    3.1 Eligibility.  Any Employee or
    consultant selected by the Committee pursuant to
    Section 3.4(a)(i) shall be eligible to be granted an
    Option. Each Independent Director of the Company shall be
    eligible to be granted Options at the times and in the manner
    set forth in Section 3.4(d).

 

    3.2 Disqualification for Stock
    Ownership.  No person may be granted an
    Incentive Stock Option under this Plan if such person, at the
    time the Incentive Stock Option is granted, owns stock
    possessing more than ten percent (10%) of the total combined
    voting power of all classes of stock of the Company or any then
    existing Subsidiary or parent corporation (within the meaning of
    Section 422 of the Code) unless such Incentive Stock Option
    conforms to the applicable provisions of Section 422 of the
    Code.

 

    3.3 Qualification of Incentive Stock
    Options.  No Incentive Stock Option shall be
    granted to any person who is not an Employee.

 

    3.4 Granting of Options.

 

    (a) The Committee shall from time to time, in its absolute
    discretion, and subject to applicable limitations of this Plan:

 

    (i) Determine which Employees are key Employees and select
    from among the key Employees or consultants (including Employees
    or consultants who have previously received Options or other
    awards under this Plan) such of them as in its opinion should be
    granted Options;

 

    (ii) Subject to the Award Limit, determine the number of
    shares to be subject to such Options granted to the selected key
    Employees or consultants;

    

    A-5

 

    (iii) Subject to Section 3.3, determine whether such
    Options are to be Incentive Stock Options or Non-Qualified Stock
    Options and whether such Options are to qualify as
    performance-based compensation as described in
    Section 162(m)(4)(C) of the Code; and

 

    (iv) Determine the terms and conditions of such Options,
    consistent with this Plan; provided, however, that the
    terms and conditions of Options intended to qualify as
    performance-based compensation as described in
    Section 162(m)(4)(C) of the Code shall include, but not be
    limited to, such terms and conditions as may be necessary to
    meet the applicable provisions of Section 162(m) of the
    Code.

 

    (b) Upon the selection of a key Employee or consultant to
    be granted an Option, the Committee shall instruct the Secretary
    of the Company to issue the Option and may impose such
    conditions on the grant of the Option as it deems appropriate.
    Without limiting the generality of the preceding sentence, the
    Committee may, in its discretion and on such terms as it deems
    appropriate, require as a condition on the grant of an Option to
    an Employee or consultant that the Employee or consultant
    surrender for cancellation some or all of the unexercised
    Options, awards of Restricted Stock or Restricted Stock Units,
    Performance Awards, Stock Appreciation Rights, Dividend
    Equivalents or Stock Payments or other rights which have been
    previously granted to him under this Plan or otherwise. An
    Option, the grant of which is conditioned upon such surrender,
    may have an option price lower (or higher) than the exercise
    price of such surrendered Option or other award, may cover the
    same (or a lesser or greater) number of shares as such
    surrendered Option or other award, may contain such other terms
    as the Committee deems appropriate, and shall be exercisable in
    accordance with its terms, without regard to the number of
    shares, price, exercise period or any other term or condition of
    such surrendered Option or other award; provided,
    however, except as permitted under Section 10.3 of the
    Plan, no Option or Stock Appreciation Right shall, without
    stockholder approval, be (i) repriced, exchanged for an
    Option or Stock Appreciation Right with a lower price or
    otherwise modified where the effect would be to reduce the
    exercise price of the Option or Stock Appreciation Right; or
    (ii) exchanged for cash or an alternate award under the
    Plan.

 

    (c) Any Incentive Stock Option granted under this Plan may
    be modified by the Committee to disqualify such option from
    treatment as an “incentive stock option” under
    Section 422 of the Code.

 

    (d) During the term of the Plan, each person who is
    initially elected or appointed to the Board and who is an
    Independent Director at the time of such initial election or
    appointment shall automatically be granted an Option to purchase
    Nine Thousand (9,000) shares of Common Stock (subject to
    adjustment as provided in Section 10.3) on the date of such
    initial election or appointment, which Option will vest in three
    equal installments on each of the first three anniversaries of
    the date of grant, subject to the Independent Director’s
    continued service as a Director on each such vesting date. In
    addition, during the term of the Plan, each Independent Director
    shall automatically be granted an Option to purchase Five
    Thousand (5,000) shares of Common Stock (subject to adjustment
    as provided in Section 10.3) on the date of each annual
    meeting of stockholders after his or her initial election or
    appointment to the Board at which directors are elected to the
    Board, which Option will vest on the first anniversary of the
    date of grant, subject to the Independent Director’s
    continued service as a Director on such vesting date;
    provided, however, that a person who is initially
    elected to the Board at an annual meeting of stockholders and
    who is an Independent Director at the time of such initial
    election shall receive only an initial Option grant on the date
    of such election pursuant to the preceding sentence and shall
    not receive an Option grant pursuant to this sentence until the
    date of the next annual meeting of stockholders following such
    initial election. Members of the Board who are employees of the
    Company who subsequently retire from the Company and remain on
    the Board will not receive an initial Option grant pursuant to
    the first sentence of this Section 3.4(d), but to the
    extent that they are otherwise eligible, will receive, after
    retirement from employment with the Company, Options as
    described in the second sentence of this Section 3.4(d).

    

    A-6

 

    ARTICLE IV.

    

 

    TERMS OF
    OPTIONS
    

 

    4.1 Option Agreement.  Each Option
    shall be evidenced by a written Stock Option Agreement, which
    shall be executed by the Optionee and an authorized officer of
    the Company and which shall contain such terms and conditions as
    the Committee (or the Board, in the case of Options granted to
    Independent Directors) shall determine, consistent with this
    Plan. Stock Option Agreements evidencing Options intended to
    qualify as performance-based compensation as described in
    Section 162(m)(4)(C) of the Code shall contain such terms
    and conditions as may be necessary to meet the applicable
    provisions of Section 162(m) of the Code. Stock Option
    Agreements evidencing Incentive Stock Options shall contain such
    terms and conditions as may be necessary to meet the applicable
    provisions of Section 422 of the Code.

 

    4.2 Option Price.  The price per
    share of the shares subject to each Option shall be set by the
    Committee; provided, however, that such price shall not
    be less than 100% of the Fair Market Value of a share of Common
    Stock on the date the Option is granted and in the case of
    Incentive Stock Options granted to an individual then owning
    (within the meaning of Section 424(d) of the Code) more
    than 10% of the total combined voting power of all classes of
    stock of the Company or any Subsidiary or parent corporation
    thereof (within the meaning of Section 422 of the Code)
    such price shall not be less than 110% of the Fair Market Value
    of a share of Common Stock on the date the Option is granted.

 

    4.3 Option Term.  The term of an
    Option shall be set by the Committee in its discretion;
    provided, however, that no Option shall have a term
    longer than six (6) years from the date the Option is
    granted and in the case of Incentive Stock Options granted to an
    individual then owning (within the meaning of
    Section 424(d) of the Code) more than 10% of the total
    combined voting power of all classes of stock of the Company or
    any Subsidiary or parent corporation thereof (within the meaning
    of Section 422 of the Code) the term may not exceed five
    (5) years from the date the Option is granted. Except as
    limited by requirements of Section 422 of the Code and
    regulations and rulings thereunder applicable to Incentive Stock
    Options, the Committee may extend the term of any outstanding
    Option in connection with any Termination of Employment or
    Termination of Consultancy of the Optionee, or amend any other
    term or condition of such Option relating to such a termination.

 

    4.4 Option Vesting.

 

    (a) The period during which the right to exercise an Option
    in whole or in part vests in the Optionee shall be set by the
    Committee and the Committee may determine that an Option may not
    be exercised in whole or in part for a specified period after it
    is granted. At any time after grant of an Option, the Committee
    may, in its sole and absolute discretion and subject to whatever
    terms and conditions it selects, accelerate the period during
    which an Option (except an Option granted to an Independent
    Director) vests. The Committee may also provide that the vesting
    of an Option granted under the Plan which is intended to qualify
    as performance-based compensation as described in
    Section 162(m)(4)(C) of the Code shall occur upon the
    satisfaction of one or more performance goals based on the
    performance criteria set forth in Section 7.1.

 

    (b) No portion of an Option which is unexercisable at
    Termination of Employment, Termination of Directorship or
    Termination of Consultancy, as applicable, shall thereafter
    become exercisable, except as may be otherwise provided by the
    Committee (or the Board, in the case of Options granted to
    Independent Directors) in the case of Options granted to
    Employees or consultants either in the Stock Option Agreement or
    by action of the Committee (or the Board, in the case of Options
    granted to Independent Directors) following the grant of the
    Option.

 

    (c) To the extent that the aggregate Fair Market Value of
    stock with respect to which “incentive stock options”
    (within the meaning of Section 422 of the Code, but without
    regard to Section 422(d) of the Code) are exercisable for
    the first time by an Optionee during any calendar year (under
    the Plan and all other incentive stock option plans of the
    Company and any Subsidiary) exceeds $100,000, such Options shall
    be treated as Non-Qualified Options to the extent required by
    Section 422 of the Code. The rule set forth in the
    preceding sentence shall be applied by taking Options into
    account in the order in which they were granted.

    

    A-7

 

    For purposes of this Section 4.4(c), the Fair Market Value
    of stock shall be determined as of the time the Option with
    respect to such stock is granted.

 

    4.5 Consideration.  In
    consideration of the granting of an Option, the Optionee shall
    agree, in the written Stock Option Agreement, to remain in the
    employ of (or to consult for or to serve as an Independent
    Director of, as applicable) the Company or any Subsidiary for a
    period of at least one year (or such shorter period as may be
    fixed in the Stock Option Agreement or by action of the
    Committee following grant of the Option) after the Option is
    granted (or, in the case of an Independent Director, until the
    next annual meeting of stockholders of the Company). Nothing in
    this Plan or in any Stock Option Agreement hereunder shall
    confer upon any Optionee any right to continue in the employ of,
    or as a consultant for, the Company or any Subsidiary, or as a
    director of the Company, or shall interfere with or restrict in
    any way the rights of the Company and any Subsidiary, which are
    hereby expressly reserved, to discharge any Optionee at any time
    for any reason whatsoever, with or without good cause.

 

    ARTICLE V.

    

 

    EXERCISE OF
    OPTIONS
    

 

    5.1 Partial Exercise.  An
    exercisable Option may be exercised in whole or in part.
    However, an Option shall not be exercisable with respect to
    fractional shares and the Committee (or the Board, in the case
    of Options granted to Independent Directors) may require that,
    by the terms of the Option, a partial exercise be with respect
    to a minimum number of shares.

 

    5.2 Manner of Exercise.  All or a
    portion of an exercisable Option shall be deemed exercised upon
    delivery of all of the following to the Secretary of the Company
    or his office:

 

    (a) A written notice complying with the applicable rules
    established by the Committee (or the Board, in the case of
    Options granted to Independent Directors) stating that the
    Option, or a portion thereof, is exercised. The notice shall be
    signed by the Optionee or other person then entitled to exercise
    the Option or such portion;

 

    (b) Such representations and documents as the Committee (or
    the Board, in the case of Options granted to Independent
    Directors), in its absolute discretion, deems necessary or
    advisable to effect compliance with all applicable provisions of
    the Securities Act of 1933, as amended, and any other federal or
    state securities laws or regulations. The Committee or Board
    may, in its absolute discretion, also take whatever additional
    actions it deems appropriate to effect such compliance
    including, without limitation, placing legends on share
    certificates and book entries and issuing stop-transfer notices
    to agents and registrars;

 

    (c) In the event that the Option shall be exercised
    pursuant to Section 10.1 by any person or persons other
    than the Optionee, appropriate proof of the right of such person
    or persons to exercise the Option; and

 

    (d) Full cash payment to the Secretary of the Company for
    the shares with respect to which the Option, or portion thereof,
    is exercised. However, the Committee (or the Board, in the case
    of Options granted to Independent Directors), may in its
    discretion, (i) allow a delay in payment up to thirty
    (30) days from the date the Option, or portion thereof, is
    exercised; (ii) allow payment, in whole or in part, through
    the delivery of shares of Common Stock owned by the Optionee,
    duly endorsed for transfer to the Company with a Fair Market
    Value on the date of delivery equal to the aggregate exercise
    price of the Option or exercised portion thereof;
    (iii) allow payment, in whole or in part, through the
    surrender of shares of Common Stock then issuable upon exercise
    of the Option having a Fair Market Value on the date of Option
    exercise equal to the aggregate exercise price of the Option or
    exercised portion thereof; (iv) allow payment, in whole or
    in part, through the delivery of property of any kind which
    constitutes good and valuable consideration; (v) allow
    payment, in whole or in part, through the delivery of a full
    recourse promissory note bearing interest (at no less than such
    rate as shall then preclude the imputation of interest under the
    Code) and payable upon such terms as may be prescribed by the
    Committee or the

    

    A-8

 

    Board; (vi) allow payment, in whole or in part, through the
    delivery of a notice that the Optionee has placed a market sell
    order with a broker with respect to shares of Common Stock then
    issuable upon exercise of the Option, and that the broker has
    been directed to pay a sufficient portion of the net proceeds of
    the sale to the Company in satisfaction of the Option exercise
    price; or (vii) allow payment through any combination of
    the consideration provided in the foregoing subparagraphs (ii),
    (iii), (iv), (v) and (vi). In the case of a promissory
    note, the Committee (or the Board, in the case of Options
    granted to Independent Directors) may also prescribe the form of
    such note and the security to be given for such note. The Option
    may not be exercised, however, by delivery of a promissory note
    or by a loan or other extension of credit from the Company when
    or where such loan or other extension of credit is prohibited by
    law.

 

    5.3 Conditions to Issuance of
    Shares.  The Company shall not be required to
    issue or deliver any certificate or certificates, or make any
    book entries, for shares of stock purchased upon the exercise of
    any Option or portion thereof prior to fulfillment of all of the
    following conditions:

 

    (a) The admission of such shares to listing on all stock
    exchanges on which such class of stock is then listed;

 

    (b) The completion of any registration or other
    qualification of such shares under any state or federal law, or
    under the rulings or regulations of the Securities and Exchange
    Commission or any other governmental regulatory body which the
    Committee or Board shall, in its absolute discretion, deem
    necessary or advisable;

 

    (c) The obtaining of any approval or other clearance from
    any state or federal governmental agency which the Committee (or
    Board, in the case of Options granted to Independent Directors)
    shall, in its absolute discretion, determine to be necessary or
    advisable;

 

    (d) The lapse of such reasonable period of time following
    the exercise of the Option as the Committee (or Board, in the
    case of Options granted to Independent Directors) may establish
    from time to time for reasons of administrative
    convenience; and

 

    (e) The receipt by the Company of full payment for such
    shares, including payment of any applicable withholding tax.

 

    Notwithstanding any other provision of the Plan, unless
    otherwise determined by the Committee (or the Board, in the case
    of Options granted to Independent Directors) or required by any
    applicable law, rule or regulation, the Company shall not
    deliver to any Optionee certificates evidencing shares of Common
    Stock issued in connection with any Option and instead such
    shares of Common Stock shall be recorded in the books of the
    Company (or, as applicable, its transfer agent or stock plan
    administrator).

 

    5.4 Rights as Stockholders.  The
    holders of Options shall not be, nor have any of the rights or
    privileges of, stockholders of the Company in respect of any
    shares purchasable upon the exercise of any part of an Option
    unless and until certificates representing such shares have been
    issued by the Company to such holders or book entries evidencing
    such shares have been made by the Company.

 

    5.5 Ownership and Transfer
    Restrictions.  The Committee (or Board, in the
    case of Options granted to Independent Directors), in its
    absolute discretion, may impose such restrictions on the
    ownership and transferability of the shares purchasable upon the
    exercise of an Option as it deems appropriate. Any such
    restriction shall be set forth in the respective Stock Option
    Agreement and may be referred to on the certificates or book
    entries evidencing such shares. The Committee may require an
    Employee to give the Company prompt notice of any disposition of
    shares of Common Stock acquired by exercise of an Incentive
    Stock Option within (i) two years from the date of granting
    such Option to such Employee or (ii) one year after the
    transfer of such shares to such Employee. The Committee may
    direct that the certificates or book entries evidencing shares
    acquired by exercise of an Option refer to such requirement to
    give prompt notice of disposition.

    

    A-9

 

    5.6 Limitations on Exercise of Options Granted to
    Independent Directors.  No Option granted to
    an Independent Director may be exercised to any extent by anyone
    after the first to occur of the following events:

 

    (a) The expiration of twelve (12) months from the date
    of the Optionee’s death;

 

    (b) The expiration of twelve (12) months from the date
    of the Optionee’s Termination of Directorship, Termination
    of Consultancy or Termination of Employment by reason of his
    permanent and total disability (within the meaning of
    Section 22(e)(3) of the Code);

 

    (c) The expiration of three (3) months from the last
    to occur of the Optionee’s Termination of Directorship,
    Termination of Consultancy or Termination of Employment, unless
    the Optionee dies within said three-month period; or

 

    (d) The expiration of six (6) years from the date the
    Option was granted.

 

    ARTICLE VI.

    

 

    AWARD OF
    RESTRICTED STOCK
    

 

    6.1 Award of Restricted Stock.

 

    (a) The Committee (or the Board, in the case of Restricted
    Stock awarded to Independent Directors) may from time to time,
    in its absolute discretion:

 

    (i) Select from among the key Employees, consultants or
    Independent Directors (including Employees, consultants or
    Independent Directors who have previously received other awards
    under this Plan) such of them as in its opinion should be
    awarded Restricted Stock; and

 

    (ii) Determine the purchase price, if any, and other terms
    and conditions applicable to such Restricted Stock, consistent
    with this Plan.

 

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

 

    (c) Upon the selection of a key Employee, consultant or
    Independent Director to be awarded Restricted Stock, the
    Committee (or the Board, in the case of Restricted Stock awarded
    to Independent Directors) shall instruct the Secretary of the
    Company to issue such Restricted Stock and may impose such
    conditions on the issuance of such Restricted Stock as it deems
    appropriate.

 

    6.2 Restricted Stock
    Agreement.  Restricted Stock shall be issued
    only pursuant to a written Restricted Stock Agreement, which
    shall be executed by the selected key Employee, consultant or
    Independent Director and an authorized officer of the Company
    and which shall contain such terms and conditions as the
    Committee (or the Board, in the case of Restricted Stock granted
    to an Independent Director) shall determine, consistent with
    this Plan. The issuance of any shares of Restricted Stock shall
    be made subject to satisfaction of all provisions of
    Section 5.3.

 

    6.3 Consideration.  As
    consideration for the issuance of Restricted Stock, in addition
    to payment of any purchase price, the Restricted Stockholder
    shall agree, in the written Restricted Stock Agreement, to
    remain in the employ of, to consult for, or to remain as an
    Independent Director of, as applicable, the Company or any
    Subsidiary for a period of at least one year after the
    Restricted Stock is issued (or such shorter period as may be
    fixed in the Restricted Stock Agreement or by action of the
    Committee (or the Board, in the case of Restricted Stock granted
    to an Independent Director) following grant of the Restricted
    Stock or, in the case of an Independent Director, until the next
    annual meeting of stockholders of the Company). Nothing in this
    Plan or in any Restricted Stock Agreement hereunder shall confer
    on any Restricted Stockholder any right to continue in the
    employ of, as a consultant for or as an Independent Director of
    the Company or any Subsidiary or shall interfere with or
    restrict in any way the rights of the Company and any
    Subsidiary, which

    

    A-10

 

    are hereby expressly reserved, to discharge any Restricted
    Stockholder at any time for any reason whatsoever, with or
    without good cause.

 

    6.4 Rights as Stockholders.  Upon
    delivery of the shares of Restricted Stock to the escrow holder
    pursuant to Section 6.7, the Restricted Stockholder shall
    have, unless otherwise provided by the Committee (or the Board,
    in the case of Restricted Stock granted to an Independent
    Director), all the rights of a stockholder with respect to said
    shares, subject to the restrictions in his Restricted Stock
    Agreement, including the right to receive all dividends and
    other distributions paid or made with respect to the shares;
    provided, however, that in the discretion of the
    Committee (or the Board, in the case of Restricted Stock granted
    to an Independent Director), any extraordinary distributions
    with respect to the Common Stock shall be subject to the
    restrictions set forth in Section 6.5.

 

    6.5 Restriction.  All shares of
    Restricted Stock issued under this Plan (including any shares
    received by holders thereof with respect to shares of Restricted
    Stock as a result of stock dividends, stock splits or any other
    form of recapitalization) shall, in the terms of each individual
    Restricted Stock Agreement, be subject to such restrictions as
    the Committee (or the Board, in the case of Restricted Stock
    granted to an Independent Director) shall provide, which
    restrictions may include, without limitation, restrictions
    concerning voting rights and transferability and vesting
    restrictions based on duration of employment with the Company,
    Company performance and individual performance; provided,
    further, that by action taken after the Restricted Stock is
    issued, the Committee (or the Board, in the case of Restricted
    Stock granted to an Independent Director) may, on such terms and
    conditions as it may determine to be appropriate, remove any or
    all of the restrictions imposed by the terms of the Restricted
    Stock Agreement. The Committee may also provide that the vesting
    of Restricted Stock granted under the Plan which is intended to
    qualify as performance-based compensation as described in
    Section 162(m)(4)(C) of the Code shall occur upon the
    satisfaction of one or more performance goals based on the
    performance criteria set forth in Section 7.1.
    Notwithstanding the foregoing, except as permitted under
    Section 10.3 of the Plan, shares of Restricted Stock will
    vest no more rapidly than ratably over a three (3) year
    period from the date of grant, unless the Committee (or the
    Board, in the case of Restricted Stock granted to an Independent
    Director) determines that the Restricted Stock award is to vest
    upon the achievement of one or more performance goals, in which
    case the period for measuring performance will be at least
    twelve (12) months. Restricted Stock may not be sold or
    encumbered until all restrictions are terminated or expire.

 

    6.6 Repurchase or Forfeiture of Restricted
    Stock.  The Committee (or the Board, in the
    case of Restricted Stock granted to an Independent Director)
    shall provide in the terms of each individual Restricted Stock
    Agreement that the Company shall have the right to repurchase
    from the Restricted Stockholder the Restricted Stock then
    subject to restrictions under the Restricted Stock Agreement
    immediately upon a Termination of Employment, Termination of
    Consultancy or Termination of Directorship between the
    Restricted Stockholder and the Company, at a cash price per
    share equal to the price paid by the Restricted Stockholder for
    such Restricted Stock; provided, however, that provision
    may be made that no such right of repurchase shall exist in the
    event of a Termination of Employment, Termination of Consultancy
    or Termination of Directorship without cause, or following a
    change in control of the Company or because of the Restricted
    Stockholder’s retirement, death or disability, or
    otherwise. Unless provided otherwise by the Committee (or the
    Board, in the case of Restricted Stock granted to an Independent
    Director), if no cash consideration was paid by the Restricted
    Stockholder upon issuance, a Restricted Stockholder’s
    rights in unvested Restricted Stock shall lapse upon the last to
    occur of Termination of Employment, Termination of Consultancy
    or Termination of Directorship with the Company.

 

    6.7 Escrow.  The Secretary of the
    Company or such other escrow holder as the Committee (or the
    Board, in the case of Restricted Stock granted to an Independent
    Director) may appoint shall retain physical custody of each
    certificate representing Restricted Stock until all of the
    restrictions imposed under the Restricted Stock Agreement with
    respect to the shares evidenced by such certificate expire or
    shall have been removed.

    

    A-11

 

    6.8 Legend.  In order to enforce
    the restrictions imposed upon shares of Restricted Stock
    hereunder, the Committee (or the Board, in the case of
    Restricted Stock granted to an Independent Director) shall cause
    a legend or legends to be placed on certificates or book entries
    representing all shares of Restricted Stock that are still
    subject to restrictions under Restricted Stock Agreements, which
    legend or legends shall make appropriate reference to the
    conditions imposed thereby.

 

    ARTICLE VII.

    

 

    PERFORMANCE
    AWARDS, DIVIDEND EQUIVALENTS, RESTRICTED STOCK UNITS, STOCK
    PAYMENTS
    

 

    7.1 Performance Awards.  Any key
    Employee, consultant or Independent Director selected by the
    Committee (or the Board, in the case of an award to an
    Independent Director) may be granted one or more Performance
    Awards. The Committee shall select the performance criteria (and
    any permissible adjustments) for each Performance Award for
    purposes of establishing the performance goal or performance
    goals applicable to such Performance Award for the designated
    performance period. The performance criteria that shall be used
    to establish such performance goals shall be limited to the
    following: (a) net earnings (either before or after one or
    more of the following: (i) interest, (ii) taxes,
    (iii) depreciation and (iv) amortization),
    (b) gross or net sales or revenue, (c) net income
    (either before or after taxes), (d) operating earnings or
    profit, (e) cash flow (including, but not limited to,
    operating cash flow and free cash flow), (f) return on
    assets, (g) return on capital, (h) return on
    stockholders’ equity, (i) return on sales,
    (j) gross or net profit or operating margin,
    (k) costs, (l) funds from operations,
    (m) expenses, (n) working capital, (o) earnings per
    share, or (p) price per share of the Common Stock, any of
    which may be measured either in absolute terms or as compared to
    any incremental increase or decrease or as compared to results
    of a peer group or to market performance indicators. The
    performance goals for a performance period shall be established
    in writing by the Committee (or the Board, in the case of an
    award to an Independent Director) based on one or more of the
    foregoing performance criteria, which goals may be expressed in
    terms of overall Company performance or the performance of a
    division, business unit or an individual. In making such
    determinations, the Committee (or the Board, in the case of an
    award to an Independent Director) shall consider (among such
    other factors as it deems relevant in light of the specific type
    of award) the contributions, responsibilities and other
    compensation of the particular key Employee, consultant or
    Independent Director.

 

    7.2 Dividend Equivalents.  Any key
    Employee, consultant or Independent Director selected by the
    Committee (or the Board, in the case of an award to an
    Independent Director) may be granted Dividend Equivalents based
    on the dividends declared on Common Stock, to be credited as of
    dividend payment dates, during the period between the date an
    Option, Stock Appreciation Right, Restricted Stock Unit or
    Performance Award is granted, and the date such Option, Stock
    Appreciation Right, Restricted Stock Unit or Performance Award
    is exercised, vests or expires, as determined by the Committee
    (or the Board, in the case of an award to an Independent
    Director). Such Dividend Equivalents shall be converted to cash
    or additional shares of Common Stock by such formula and at such
    time and subject to such limitations as may be determined by the
    Committee (or the Board, in the case of an award to an
    Independent Director). Notwithstanding the foregoing, no
    Dividend Equivalents shall be payable with respect to Options or
    Stock Appreciation Rights.

 

    7.3 Stock Payments.  Any key
    Employee, consultant or Independent Director selected by the
    Committee (or the Board, in the case of an award to an
    Independent Director) may receive Stock Payments in the manner
    determined from time to time by the Committee. The number of
    shares shall be determined by the Committee (or the Board, in
    the case of an award to an Independent Director) and may be
    based upon the Fair Market Value, book value, net profits or
    other measure of the value of Common Stock or other specific
    performance criteria determined appropriate by the Committee (or
    the Board, in the case of an award to an Independent Director),
    determined on the date such Stock Payment is made or on any date
    thereafter. The Committee may provide that the vesting of Stock
    Payments granted under the Plan which are intended to qualify as
    performance-based compensation as described in
    Section 162(m)(4)(C) of the Code shall occur upon the
    satisfaction of one or more performance goals based on the
    performance criteria set forth in Section 7.1.

    

    A-12

 

    7.4 Restricted Stock Units.

 

    (a) Any key Employee, consultant or Independent Director
    selected by the Committee (or the Board, in the case of an award
    to an Independent Director) may be granted an award of
    Restricted Stock Units in the manner determined from time to
    time by the Committee. The number of shares subject to a
    Restricted Stock Unit award shall be determined by the Committee
    (or the Board, in the case of an award to an Independent
    Director). The Committee may provide that the vesting of
    Restricted Stock Units granted under the Plan which are intended
    to qualify as performance-based compensation as described in
    Section 162(m)(4)(C) of the Code shall occur upon the
    satisfaction of one or more performance goals based on the
    performance criteria set forth in Section 7.1. Common Stock
    underlying a Restricted Stock Unit award will not be issued
    until the Restricted Stock Unit award has vested. Unless
    otherwise provided by the Committee (or the Board, in the case
    of an award to an Independent Director), a Grantee of Restricted
    Stock Units shall have no rights as a Company stockholder with
    respect to the shares of Common Stock underlying such Restricted
    Stock Units until such time as the award has vested and such
    Common Stock underlying the award has been issued.

 

    (b) During the term of the Plan thereafter, each person who
    is initially elected or appointed to the Board and who is an
    Independent Director at the time of such initial election or
    appointment shall automatically be granted an award of Three
    Thousand (3,000) Restricted Stock Units (subject to adjustment
    as provided in Section 10.3) on the date of such initial
    election or appointment, which Restricted Stock Unit award will
    vest in three equal installments on each of the first three
    anniversaries of the date of grant, subject to the Independent
    Director’s continued service as a Director on each such
    vesting date. In addition, during the term of the Plan
    thereafter, each Independent Director shall automatically be
    granted an award of One Thousand Six Hundred (1,600) Restricted
    Stock Units (subject to adjustment as provided in
    Section 10.3) on the date of each annual meeting of
    stockholders after his or her initial election or appointment to
    the Board at which directors are elected to the Board, which
    Restricted Stock Unit award will vest on the first anniversary
    of the date of grant, subject to the Independent Director’s
    continued service as a Director on such vesting date;
    provided, however, that a person who is initially
    elected to the Board at an annual meeting of stockholders and
    who is an Independent Director at the time of such initial
    election shall receive only an initial Restricted Stock Unit
    award on the date of such election pursuant to the preceding
    sentence and shall not receive a Restricted Stock Unit award
    pursuant to this sentence until the date of the next annual
    meeting of stockholders following such initial election. Members
    of the Board who are employees of the Company who subsequently
    retire from the Company and remain on the Board will not receive
    an initial Restricted Stock Unit award pursuant to the first
    sentence of this Section 7.4(b), but to the extent that
    they are otherwise eligible, will receive, after retirement from
    employment with the Company, Restricted Stock Unit awards as
    described in the second sentence of this Section 7.4(b).

 

    7.5 Performance Award Agreement, Dividend Equivalent
    Agreement, Restricted Stock Unit Agreement, Stock Payment
    Agreement.  Each Performance Award, Dividend
    Equivalent, award of Restricted Stock Units
    and/or Stock
    Payment shall be evidenced by a written agreement, which shall
    be executed by the Grantee and an authorized Officer of the
    Company and which shall contain such terms and conditions as the
    Committee (or the Board, in the case of an award to an
    Independent Director) shall determine, consistent with this Plan.

 

    7.6 Term.  The term of a
    Performance Award, Dividend Equivalent, award of Restricted
    Stock Unit
    and/or Stock
    Payment shall be set by the Committee (or the Board, in the case
    of an award to an Independent Director) in its discretion.

 

    7.7 Exercise Upon Termination of
    Employment.  A Performance Award, Dividend
    Equivalent, award of Restricted Stock Unit
    and/or Stock
    Payment is exercisable or payable only while the Grantee is an
    Employee, consultant or Independent Director; provided that the
    Committee may (or the Board, in the case of an award to an
    Independent Director) determine that the Performance Award,
    Dividend Equivalent, award of Restricted Stock Unit
    and/or Stock
    Payment may be exercised or paid subsequent to Termination of
    Employment, Termination of Consultancy or Termination of
    Directorship without cause, or following a change in control of
    the Company, or because of the Grantee’s retirement, death
    or disability, or otherwise.

 

    7.8 Payment on Exercise.  Payment
    of the amount determined under Section 7.1 or 7.2 above
    shall be in cash, in Common Stock or a combination of both, as
    determined by the Committee (or the Board, in the case

    

    A-13

 

    of an award to an Independent Director). To the extent any
    payment under this Article VII is effected in Common Stock,
    it shall be made subject to satisfaction of all provisions of
    Section 5.3.

 

    7.9 Consideration.  As
    consideration for the issuance of a Performance Award, Dividend
    Equivalent, award of Restricted Stock Unit
    and/or Stock
    Payment, the Grantee shall agree, in a written agreement, to
    remain in the employ of, to consult for, or to remain as an
    Independent Director of, as applicable, the Company or any
    Subsidiary for a period of at least one year after such
    Performance Award, Dividend Equivalent, award of Restricted
    Stock Unit
    and/or Stock
    Payment is granted (or such shorter period as may be fixed in
    such agreement or by action of the Committee (or the Board, in
    the case of an award to an Independent Director) following such
    grant or, in the case of an Independent Director, until the next
    annual meeting of stockholders of the Company). Nothing in this
    Plan or in any agreement hereunder shall confer on any Grantee
    any right to continue in the employ of, as a consultant for or
    as an Independent Director of the Company or any Subsidiary or
    shall interfere with or restrict in any way the rights of the
    Company and any Subsidiary, which are hereby expressly reserved,
    to discharge any Grantee at any time for any reason whatsoever,
    with or without good cause.

 

    ARTICLE VIII.

    

 

    STOCK
    APPRECIATION RIGHTS
    

 

    8.1 Grant of Stock Appreciation
    Rights.  A Stock Appreciation Right may be
    granted to any key Employee, consultant or Independent Director
    selected by the Committee (or the Board, in the case of an award
    to an Independent Director). A Stock Appreciation Right may be
    granted (i) in connection and simultaneously with the grant
    of an Option, (ii) with respect to a previously granted
    Option, or (iii) independent of an Option. A Stock
    Appreciation Right shall be subject to such terms and conditions
    not inconsistent with this Plan as the Committee (or the Board,
    in the case of an award to an Independent Director) shall impose
    and shall be evidenced by a written Stock Appreciation Right
    Agreement, which shall be executed by the Grantee and an
    authorized officer of the Company; provided,
    however, that no Stock Appreciation Right shall have a
    term longer than six (6) years from the date the Stock
    Appreciation Right is granted. The Committee, in its discretion,
    may determine whether a Stock Appreciation Right is to qualify
    as performance-based compensation as described in
    Section 162(m)(4)(C) of the Code and Stock Appreciation
    Right Agreements evidencing Stock Appreciation Rights intended
    to so qualify shall contain such terms and conditions as may be
    necessary to meet the applicable provisions of
    Section 162(m) of the Code, including providing that the
    vesting of such Stock Appreciation Rights shall occur upon the
    satisfaction of one or more performance goals based on the
    performance criteria set forth in Section 7.1. Without
    limiting the generality of the foregoing, the Committee may, in
    its discretion and on such terms as it deems appropriate,
    require as a condition of the grant of a Stock Appreciation
    Right to an Employee, consultant or Independent Director that
    the Employee, consultant or Independent Director surrender for
    cancellation some or all of the unexercised Options, awards of
    Restricted Stock or Restricted Stock Units, Performance Awards,
    Stock Appreciation Rights, Dividend Equivalents or Stock
    Payments, or other rights which have been previously granted to
    him under this Plan or otherwise. Subject to
    Section 3.4(b), a Stock Appreciation Right, the grant of
    which is conditioned upon such surrender, may have an exercise
    price lower (or higher) than the exercise price of the
    surrendered Option or other award, may cover the same (or a
    lesser or greater) number of shares as such surrendered Option
    or other award, may contain such other terms as the Committee
    deems appropriate, and shall be exercisable in accordance with
    its terms, without regard to the number of shares, price,
    exercise period or any other term or condition of such
    surrendered Option or other award.

 

    8.2 Coupled Stock Appreciation Rights.

 

    (a) A Coupled Stock Appreciation Right (“CSAR”)
    shall be related to a particular Option and shall be exercisable
    only when and to the extent the related Option is exercisable.

 

    (b) A CSAR may be granted to the Grantee for no more than
    the number of shares subject to the simultaneously or previously
    granted Option to which it is coupled.

    

    A-14

 

    (c) A CSAR shall entitle the Grantee (or other person
    entitled to exercise the Option pursuant to this Plan) to
    surrender to the Company unexercised a portion of the Option to
    which the CSAR relates (to the extent then exercisable pursuant
    to its terms) and to receive from the Company in exchange
    therefor an amount determined by multiplying the difference
    obtained by subtracting the Option exercise price from the Fair
    Market Value of a share of Common Stock on the date of exercise
    of the CSAR by the number of shares of Common Stock with respect
    to which the CSAR shall have been exercised, subject to any
    limitations the Committee may impose.

 

    8.3 Independent Stock Appreciation Rights.

 

    (a) An Independent Stock Appreciation Right
    (“ISAR”) shall be unrelated to any Option and shall
    have a term set by the Committee. An ISAR shall be exercisable
    in such installments as the Committee may determine. An ISAR
    shall cover such number of shares of Common Stock as the
    Committee may determine; provided, however, that unless
    the Committee otherwise provides in the terms of the ISAR or
    otherwise, no ISAR granted to a person subject to
    Section 16 of the Exchange Act shall be exercisable until
    at least six months have elapsed from (but excluding) the date
    on which the Option was granted. The exercise price per share of
    Common Stock subject to each ISAR shall be set by the Committee;
    provided, however, that such price shall not be less than
    100% of the Fair Market Value of a share of Common Stock on the
    date the ISAR is granted. An ISAR is exercisable only while the
    Grantee is an Employee, consultant or Independent Director;
    provided that the Committee may determine that the ISAR may be
    exercised subsequent to Termination of Employment, Termination
    of Consultancy or Termination of Directorship without cause, or
    following a change in control of the Company, or because of the
    Grantee’s retirement, death or disability, or otherwise.

 

    (b) An ISAR shall entitle the Grantee (or other person
    entitled to exercise the ISAR pursuant to this Plan) to exercise
    all or a specified portion of the ISAR (to the extent then
    exercisable pursuant to its terms) and to receive from the
    Company an amount determined by multiplying the difference
    obtained by subtracting the exercise price per share of the ISAR
    from the Fair Market Value of a share of Common Stock on the
    date of exercise of the ISAR by the number of shares of Common
    Stock with respect to which the ISAR shall have been exercised,
    subject to any limitations the Committee may impose.

 

    8.4 Payment and Limitations on Exercise.

 

    (a) Payment of the amount determined under
    Sections 8.2(c) and 8.3(b) above shall be in cash, in
    Common Stock (based on its Fair Market Value as of the date the
    Stock Appreciation Right is exercised) or a combination of both,
    as determined by the Committee. To the extent such payment is
    effected in Common Stock it shall be made subject to
    satisfaction of all provisions of Section 5.3 above
    pertaining to Options.

 

    (b) Grantees of Stock Appreciation Rights may be required
    to comply with any timing or other restrictions with respect to
    the settlement or exercise of a Stock Appreciation Right,
    including a window-period limitation, as may be imposed in the
    discretion of the Board or Committee.

 

    8.5 Consideration.  As
    consideration for the granting of a Stock Appreciation Right,
    the Grantee shall agree, in the written Stock Appreciation Right
    Agreement, to remain in the employ of, to consult for or to
    remain as an Independent Director of, as applicable, the Company
    or any Subsidiary for a period of at least one year after the
    Stock Appreciation Right is granted (or such shorter period as
    may be fixed in the Stock Appreciation Right Agreement or by
    action of the Committee (or the Board, in the case of an award
    to an Independent Director) following grant of the Stock
    Appreciation Right or, in the case of an Independent Director,
    until the next annual meeting of stockholders of the Company).
    Nothing in this Plan or in any Stock Appreciation Right
    Agreement hereunder shall confer on any Grantee any right to
    continue in the employ of, as a consultant for or as an
    Independent Director of the Company or any Subsidiary or shall
    interfere with or restrict in any way the rights of the Company
    and any Subsidiary, which are hereby expressly reserved, to
    discharge any Grantee at any time for any reason whatsoever,
    with or without good cause.

    

    A-15

 

    ARTICLE IX.

    

 

    ADMINISTRATION
    

 

    9.1 Compensation Committee.  The
    Compensation Committee (or another committee or a subcommittee
    of the Board assuming the functions of the Committee under this
    Plan) shall consist solely of two or more Independent Directors
    appointed by and holding office at the pleasure of the Board,
    each of whom is both a “non-employee director” as
    defined by
    Rule 16b-3
    and an “outside director” for purposes of
    Section 162(m) of the Code. Appointment of Committee
    members shall be effective upon acceptance of appointment.
    Committee members may resign at any time by delivering written
    notice to the Board. Vacancies in the Committee may be filled by
    the Board.

 

    9.2 Duties and Powers of
    Committee.  It shall be the duty of the
    Committee to conduct the general administration of this Plan in
    accordance with its provisions. The Committee shall have the
    power to interpret this Plan and the agreements pursuant to
    which Options, awards of Restricted Stock or Restricted Stock
    Units, Performance Awards, Stock Appreciation Rights, Dividend
    Equivalents or Stock Payments are granted or awarded, and to
    adopt such rules for the administration, interpretation, and
    application of this Plan as are consistent therewith and to
    interpret, amend or revoke any such rules. Notwithstanding the
    foregoing, the full Board, acting by a majority of its members
    in office, shall conduct the general administration of the Plan
    with respect to awards granted to Independent Directors. Any
    such grant or award under this Plan need not be the same with
    respect to each Optionee, Grantee or Restricted Stockholder. Any
    such interpretations and rules with respect to Incentive Stock
    Options shall be consistent with the provisions of
    Section 422 of the Code. In its absolute discretion, the
    Board may at any time and from time to time exercise any and all
    rights and duties of the Committee under this Plan except with
    respect to matters which under
    Rule 16b-3
    or Section 162(m) of the Code, or any regulations or rules
    issued thereunder, are required to be determined in the sole
    discretion of the Committee. To the extent permitted by
    applicable law, the Committee may from time to time delegate to
    a committee of one or more members of the Board or one or more
    officers of the Company the authority to grant or amend awards
    to Participants other than (a) senior executives of the
    Company who are subject to Section 16 of the Exchange Act,
    (b) any Employee who is, or could be, a “covered
    employee” within the meaning of Section 162(m) of the
    Code, or (c) officers of the Company (or members of the
    Board) to whom authority to grant or amend awards has been
    delegated hereunder. Any delegation hereunder shall be subject
    to the restrictions and limits that the Committee specifies at
    the time of such delegation, and the Committee may at any time
    rescind the authority so delegated or appoint a new delegatee.
    At all times, the delegatee appointed under this Section shall
    serve in such capacity at the pleasure of the Committee.

 

    9.3 Majority Rule; Unanimous Written
    Consent.  The Committee shall act by a
    majority of its members in attendance at a meeting at which a
    quorum is present or by a memorandum or other written instrument
    signed by all members of the Committee.

 

    9.4 Compensation; Professional Assistance; Good Faith
    Actions.  Members of the Committee shall
    receive such compensation for their services as members as may
    be determined by the Board. All expenses and liabilities which
    members of the Committee incur in connection with the
    administration of this Plan shall be borne by the Company. The
    Committee may, with the approval of the Board, employ attorneys,
    consultants, accountants, appraisers, brokers, or other persons.
    The Committee, the Company and the Company’s officers and
    Directors shall be entitled to rely upon the advice, opinions or
    valuations of any such persons. All actions taken and all
    interpretations and determinations made by the Committee or the
    Board in good faith shall be final and binding upon all
    Optionees, Grantees, Restricted Stockholders, the Company and
    all other interested persons. No members of the Committee or
    Board shall be personally liable for any action, determination
    or interpretation made in good faith with respect to this Plan,
    Options, awards of Restricted Stock or Restricted Stock Units,
    Performance Awards, Stock Appreciation Rights, Dividend
    Equivalents or Stock Payments, and all members of the Committee
    and the Board shall be fully protected by the Company in respect
    of any such action, determination or interpretation.

    

    A-16

 

    ARTICLE X.

    

 

    MISCELLANEOUS
    PROVISIONS
    

 

    10.1 Not Transferable.  Options,
    Restricted Stock awards, Restricted Stock Unit awards,
    Performance Awards, Stock Appreciation Rights, Dividend
    Equivalents or Stock Payments under this Plan may not be sold,
    pledged, assigned, or transferred in any manner other than by
    will or the laws of descent and distribution or pursuant to a
    QDRO, unless and until such rights or awards have been
    exercised, or the shares underlying such rights or awards have
    been issued, and all restrictions applicable to such shares have
    lapsed. No Option, Restricted Stock award, Restricted Stock Unit
    award, Performance Award, Stock Appreciation Right, Dividend
    Equivalent or Stock Payment or interest or right therein shall
    be liable for the debts, contracts or engagements of the
    Optionee, Grantee or Restricted Stockholder or his successors in
    interest or shall be subject to disposition by transfer,
    alienation, anticipation, pledge, encumbrance, assignment or any
    other means whether such disposition be voluntary or involuntary
    or by operation of law by judgment, levy, attachment,
    garnishment or any other legal or equitable proceedings
    (including bankruptcy), and any attempted disposition thereof
    shall be null and void and of no effect, except to the extent
    that such disposition is permitted by the preceding sentence.

 

    During the lifetime of the Optionee or Grantee, only he may
    exercise an Option or other right or award (or any portion
    thereof) granted to him under the Plan, unless it has been
    disposed of pursuant to a QDRO. After the death of the Optionee
    or Grantee, any exercisable portion of an Option or other right
    or award may, prior to the time when such portion becomes
    unexercisable under the Plan or the applicable Stock Option
    Agreement or other agreement, be exercised by his personal
    representative or by any person empowered to do so under the
    deceased Optionee’s or Grantee’s will or under the
    then applicable laws of descent and distribution.

 

    10.2 Amendment, Suspension or Termination of this
    Plan.  Except as otherwise provided in this
    Section 10.2, this Plan may be wholly or partially amended
    or otherwise modified, suspended or terminated at any time or
    from time to time by the Board or the Committee. However,
    without approval of the Company’s stockholders given within
    twelve months before or after the action by the Board or the
    Committee, no action of the Board or the Committee may, except
    as provided in Section 10.3, increase the limits imposed in
    Section 2.1 on the maximum number of shares which may be
    issued under this Plan or modify the Award Limit, and no action
    of the Board or the Committee may be taken that would otherwise
    require stockholder approval as a matter of applicable law, or
    the rules and regulations of any stock exchange or national
    market system on which the Common Stock is then listed. No
    amendment, suspension or termination of this Plan shall, without
    the consent of the holder of Options, Restricted Stock awards,
    Restricted Stock Unit awards, Performance Awards, Stock
    Appreciation Rights, Dividend Equivalents or Stock Payments,
    alter or impair any rights or obligations under any Options,
    Restricted Stock awards, Restricted Stock Unit awards,
    Performance Awards, Stock Appreciation Rights, Dividend
    Equivalents or Stock Payments theretofore granted or awarded,
    unless the award itself otherwise expressly so provides. No
    Options, Restricted Stock, Restricted Stock Units, Performance
    Awards, Stock Appreciation Rights, Dividend Equivalents or Stock
    Payments may be granted or awarded during any period of
    suspension or after termination of this Plan, and in no event
    may any Incentive Stock Option be granted under this Plan after
    June 21, 2020.

 

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

 

    (a) Subject to Section 10.3(d), in the event that the
    Committee (or the Board, in the case of awards granted to
    Independent Directors) determines that any dividend or other
    distribution (whether in the form of cash, Common Stock, other
    securities, or other property) (other than normal cash
    dividends), recapitalization, reclassification, stock split,
    reverse stock split, reorganization, merger, consolidation,
    split-up,
    spin-off, combination, repurchase, liquidation, dissolution, or
    sale, transfer, exchange or other disposition of all or
    substantially all of the assets of the Company (including, but
    not limited to, a Corporate Transaction), or exchange of Common
    Stock or other securities of the Company, issuance of warrants
    or other rights to purchase Common Stock or other securities of
    the Company, or other similar corporate transaction or event
    (other than an Equity Restructuring), in the Committee’s
    sole discretion (or in the case of awards granted to

    

    A-17

 

    Independent Directors, the Board’s sole discretion),
    affects the Common Stock such that an adjustment is determined
    by the Committee to be appropriate in order to prevent dilution
    or enlargement of the benefits or potential benefits intended to
    be made available under the Plan or with respect to an Option,
    Restricted Stock award, Performance Award, Stock Appreciation
    Right, Dividend Equivalent, Restricted Stock Unit award or Stock
    Payment, then the Committee (or the Board, in the case of awards
    granted to Independent Directors) shall, in such manner as it
    may deem equitable, adjust any or all of:

 

    (i) the number and kind of shares of Common Stock (or other
    securities or property) with respect to which Options,
    Restricted Stock Units, Performance Awards, Stock Appreciation
    Rights, Dividend Equivalents or Stock Payments may be granted
    under the Plan, or which may be granted as Restricted Stock
    (including, but not limited to, adjustments of the limitations
    in Section 2.1 on the maximum number and kind of shares
    which may be issued, adjustments of the Award Limit and
    adjustments of the manner in which shares subject to Full Value
    Awards will be counted),

 

    (ii) the number and kind of shares of Common Stock (or
    other securities or property) subject to outstanding Options,
    Restricted Stock Units, Performance Awards, Stock Appreciation
    Rights, Dividend Equivalents, or Stock Payments, and in the
    number and kind of shares of outstanding Restricted
    Stock, and

 

    (iii) the grant or exercise price with respect to any
    Option, Restricted Stock Unit, Performance Award, Stock
    Appreciation Right, Dividend Equivalent or Stock
    Payment, and

 

    (iv) the number and kind of shares of Common Stock (or
    other securities or property) for which automatic grants of
    Options and Restricted Stock Units are subsequently to be made
    to new and continuing Independent Directors pursuant to
    Section 3.4(d) and Section 7.4(b), respectively.

 

    (b) Subject to Sections 10.3(b)(vii), 10.3(d) and
    10.3(e) in the event of any Corporate Transaction or other
    transaction or event described in Section 10.3(a) or any
    unusual or nonrecurring transactions or events affecting the
    Company, any affiliate of the Company, or the financial
    statements of the Company or any affiliate, or of changes in
    applicable laws, regulations, or accounting principles, the
    Committee (or the Board, in the case of awards granted to
    Independent Directors) in its discretion is hereby authorized to
    take any one or more of the following actions whenever the
    Committee (or the Board, in the case of awards granted to
    Independent Directors) determines that such action is
    appropriate in order to prevent dilution or enlargement of the
    benefits or potential benefits intended to be made available
    under the Plan or with respect to any option, right or other
    award under this Plan, to facilitate such transactions or events
    or to give effect to such changes in laws, regulations or
    principles:

 

    (i) In its sole and absolute discretion, and on such terms
    and conditions as it deems appropriate, the Committee (or the
    Board, in the case of awards granted to Independent Directors)
    may provide, either by the terms of the agreement or by action
    taken prior to the occurrence of such transaction or event and
    either automatically or upon the optionee’s request, for
    either the purchase of any such Option, Performance Award, Stock
    Appreciation Right, Dividend Equivalent, or Stock Payment, or
    any Restricted Stock or Restricted Stock Unit for an amount of
    cash equal to the amount that could have been attained upon the
    exercise of such option, right or award or realization of the
    optionee’s rights had such option, right or award been
    currently exercisable or payable or fully vested or the
    replacement of such option, right or award with other rights or
    property selected by the Committee (or the Board, in the case of
    awards granted to Independent Directors) in its sole discretion;

 

    (ii) In its sole and absolute discretion, the Committee (or
    the Board, in the case of awards granted to Independent
    Directors) may provide, either by the terms of such Option,
    Performance Award, Stock Appreciation Right, Dividend
    Equivalent, or Stock Payment, or Restricted Stock or Restricted
    Stock Unit award or by action taken prior to the occurrence of
    such transaction or event that it cannot be exercised after such
    event;

    

    A-18

 

    (iii) In its sole and absolute discretion, and on such
    terms and conditions as it deems appropriate, the Committee (or
    the Board, in the case of awards granted to Independent
    Directors) may provide, either by the terms of such Option,
    Performance Award, Stock Appreciation Right, Dividend
    Equivalent, or Stock Payment, or Restricted Stock or Restricted
    Stock Unit award or by action taken prior to the occurrence of
    such transaction or event, that for a specified period of time
    prior to such transaction or event, such option, right or award
    shall be vested
    and/or
    exercisable as to all shares covered thereby, notwithstanding
    anything to the contrary in (i) Section 4.4 or
    (ii) the provisions of such Option, Performance Award,
    Stock Appreciation Right, Dividend Equivalent, or Stock Payment,
    or Restricted Stock or Restricted Stock Unit award;

 

    (iv) In its sole and absolute discretion, and on such terms
    and conditions as it deems appropriate, the Committee (or the
    Board, in the case of awards granted to Independent Directors)
    may provide, either by the terms of such Option, Performance
    Award, Stock Appreciation Right, Dividend Equivalent, or Stock
    Payment, or Restricted Stock or Restricted Stock Unit award or
    by action taken prior to the occurrence of such transaction or
    event, that upon such event, such option, right or award be
    assumed by the successor or survivor corporation, or a parent or
    subsidiary thereof, or shall be substituted for by similar
    options, rights or awards covering the stock of the successor or
    survivor corporation, or a parent or subsidiary thereof, with
    appropriate adjustments as to the number and kind of shares and
    prices;

 

    (v) In its sole and absolute discretion, and on such terms
    and conditions as it deems appropriate, the Committee (or the
    Board, in the case of awards granted to Independent Directors)
    may make adjustments in the number and type of shares of Common
    Stock (or other securities or property) subject to outstanding
    Options, Restricted Stock Units, Performance Awards, Stock
    Appreciation Rights, Dividend Equivalents, or Stock Payments,
    and in the number and kind of outstanding Restricted Stock
    and/or in
    the terms and conditions of (including the grant or exercise
    price), and the criteria included in, outstanding options,
    rights and awards and options, rights and awards which may be
    granted in the future;

 

    (vi) In its sole and absolute discretion, and on such terms
    and conditions as it deems appropriate, the Committee may
    provide either by the terms of a Restricted Stock award or by
    action taken prior to the occurrence of such event that, for a
    specified period of time prior to such event, the restrictions
    imposed under a Restricted Stock Agreement upon some or all
    shares of Restricted Stock may be terminated, and, some or all
    shares of such Restricted Stock may cease to be subject to
    repurchase under Section 6.6 or forfeiture under
    Section 6.5 after such event; and

 

    (vii) None of the foregoing discretionary actions taken
    under this Section 10.3(b) shall be permitted with respect to
    awards granted to Independent Directors to the extent that such
    discretion would be inconsistent with the applicable exemptive
    conditions of
    Rule 16b-3.
    In the event of a Change in Control or a Corporate Transaction,
    to the extent that the Board does not have the ability under
    Rule 16b-3
    to take or to refrain from taking the discretionary actions set
    forth in Section 10.3(b)(iii) above, each award granted to
    an Independent Director shall be vested
    and/or
    exercisable as to all shares covered thereby upon such Change in
    Control or during the five days immediately preceding the
    consummation of such Corporate Transaction and subject to such
    consummation, notwithstanding anything to the contrary in
    Section 4.4 or the vesting schedule of such awards. In the
    event of a Corporate Transaction, to the extent that the Board
    does not have the ability under
    Rule 16b-3
    to take or to refrain from taking the discretionary actions set
    forth in Section 10.3(b)(ii) above, no Option granted to an
    Independent Director may be exercised following such Corporate
    Transaction unless such Option is, in connection with such
    Corporate Transaction, either assumed by the successor or
    survivor corporation (or parent or subsidiary thereof) or
    replaced with a comparable right with respect to shares of the
    capital stock of the successor or survivor corporation (or
    parent or subsidiary thereof).

 

    (c) Subject to Sections 10.3(d) and 10.7, the
    Committee (or the Board, in the case of awards granted to
    Independent Directors) may, in its discretion, include such
    further provisions and limitations in any Option, Performance
    Award, Stock Appreciation Right, Dividend Equivalent, or Stock
    Payment, or Restricted Stock or

    

    A-19

 

    Restricted Stock Unit agreement or certificate, as it may deem
    equitable and in the best interests of the Company.

 

    (d) With respect to Incentive Stock Options and awards
    intended to qualify as performance-based compensation under
    Section 162(m), no adjustment or action described in this
    Section 10.3 or in any other provision of the Plan shall be
    authorized to the extent that such adjustment or action would
    cause the Plan to violate Section 422(b)(1) of the Code or
    would cause such award to fail to so qualify under
    Section 162(m), as the case may be, or any successor
    provisions thereto. Furthermore, no such adjustment or action
    shall be authorized to the extent such adjustment or action
    would result in short-swing profits liability under
    Section 16 or violate the exemptive conditions of
    Rule 16b-3
    unless the Committee (or the Board, in the case of awards
    granted to Independent Directors) determines that the option or
    other award is not to comply with such exemptive conditions. The
    number of shares of Common Stock subject to any option, right or
    award shall always be rounded to the next whole number.

 

    (e) In connection with the occurrence of any Equity
    Restructuring, and notwithstanding anything to the contrary in
    Sections 10.3(a) and 10.3(b):

 

    (i) The number and type of securities subject to each
    outstanding award and the exercise price or grant price thereof,
    if applicable, shall be equitably adjusted. The adjustments
    provided under this Section 10(e) shall be nondiscretionary
    and shall be final and binding on the affected holder and the
    Company.

 

    (ii) The Committee (or the Board, in the case of awards
    granted to Independent Directors) shall make such equitable
    adjustments, if any, as the Committee may deem appropriate to
    reflect such Equity Restructuring with respect to the aggregate
    number and kind of shares that may be issued under the Plan
    (including, but not limited to, adjustments of the limitations
    in Section 2.1 on the maximum number and kind of shares
    which may be issued under the Plan or the Award Limit and
    adjustments of the manner in which shares subject to Full Value
    Awards will be counted).

 

    10.4 Tax Withholding.  The Company
    shall be entitled to require payment in cash or deduction from
    other compensation payable to each Optionee, Grantee or
    Restricted Stockholder of any sums required by federal, state or
    local tax law to be withheld with respect to the issuance,
    vesting or exercise of any Option, Restricted Stock, Restricted
    Stock Unit, Performance Award, Stock Appreciation Right,
    Dividend Equivalent or Stock Payment. The Committee (or the
    Board, in the case of awards granted to Independent Directors)
    may in its discretion and in satisfaction of the foregoing
    requirement allow such Optionee, Grantee or Restricted
    Stockholder to elect to have the Company withhold shares of
    Common Stock otherwise issuable under such Option or other award
    (or allow the return of shares of Common Stock) having a Fair
    Market Value equal to the minimum amounts required to be
    withheld.

 

    10.5 Loans.  The Committee may, in
    its discretion, and to the extent permitted by law extend one or
    more loans to key Employees in connection with the exercise or
    receipt of an Option, Performance Award, Stock Appreciation
    Right, Dividend Equivalent or Stock Payment granted under this
    Plan, or the issuance, vesting or distribution of Restricted
    Stock or Restricted Stock Units awarded under this Plan. The
    terms and conditions of any such loan shall be set by the
    Committee (or the Board, in the case of awards granted to
    Independent Directors). No loans will be made to key Employees
    if such loans would be prohibited by Section 402 of the
    Sarbanes-Oxley Act of 2002.

 

    10.6 Forfeiture
    Provisions.  Pursuant to its general authority
    to determine the terms and conditions applicable to awards under
    the Plan, the Committee (or the Board, in the case of awards
    granted to Independent Directors) shall have the right (to the
    extent consistent with the applicable exemptive conditions of
    Rule 16b-3)
    to provide, in the terms of Options or other awards made under
    the Plan, or to require the recipient to agree by separate
    written instrument, that (i) any proceeds, gains or other
    economic benefit actually or constructively received by the
    recipient upon any receipt or exercise of the award, or upon the
    receipt or resale of any Common Stock underlying such award,
    must be paid to the Company, and (ii) the award shall
    terminate and any unexercised portion of such award (whether or
    not vested) shall be forfeited, if (a) a Termination of
    Employment, Termination of Consultancy or Termination of
    Directorship occurs prior to

    

    A-20

 

    a specified date, or within a specified time period following
    receipt or exercise of the award, or (b) the recipient at
    any time, or during a specified time period, engages in any
    activity in competition with the Company, or which is inimical,
    contrary or harmful to the interests of the Company, as further
    defined by the Committee (or the Board, as applicable).

 

    10.7 Limitations Applicable to
    Section 16 Persons and Performance-Based
    Compensation.  Notwithstanding any other
    provision of this Plan, this Plan, and any Option, Performance
    Award, Stock Appreciation Right, Dividend Equivalent or Stock
    Payment granted, or Restricted Stock or Restricted Stock Unit
    awarded, to any individual who is then subject to
    Section 16 of the Exchange Act, shall be subject to any
    additional limitations set forth in any applicable exemptive
    rule under Section 16 of the Exchange Act (including any
    amendment to
    Rule 16b-3
    of the Exchange Act) that are requirements for the application
    of such exemptive rule. To the extent permitted by applicable
    law, the Plan, Options, Performance Awards, Stock Appreciation
    Rights, Dividend Equivalents, Stock Payments, Restricted Stock
    and Restricted Stock Units granted or awarded hereunder shall be
    deemed amended to the extent necessary to conform to such
    applicable exemptive rule. Furthermore, notwithstanding any
    other provision of this Plan, any Option, Performance Award,
    Stock Appreciation Right, Dividend Equivalent, Stock Payment,
    Restricted Stock or Restricted Stock Unit intended to qualify as
    performance-based compensation as described in
    Section 162(m)(4)(C) of the Code shall be subject to any
    additional limitations set forth in Section 162(m) of the
    Code (including any amendment to Section 162(m) of the
    Code) or any regulations or rulings issued thereunder that are
    requirements for qualification as performance-based compensation
    as described in Section 162(m)(4)(C) of the Code, and this
    Plan shall be deemed amended to the extent necessary to conform
    to such requirements.

 

    10.8 Effect of Plan Upon Options and Compensation
    Plans.  The adoption of this Plan shall not
    affect any other compensation or incentive plans in effect for
    the Company or any Subsidiary. Nothing in this Plan shall be
    construed to limit the right of the Company (i) to
    establish any other forms of incentives or compensation for
    Employees, Directors or Consultants of the Company or any
    Subsidiary or (ii) to grant or assume options or other
    rights otherwise than under this Plan in connection with any
    proper corporate purpose including but not by way of limitation,
    the grant or assumption of options in connection with the
    acquisition by purchase, lease, merger, consolidation or
    otherwise, of the business, stock or assets of any corporation,
    partnership, limited liability company, firm or association.

 

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

 

    10.10 Titles.  Titles are provided
    herein for convenience only and are not to serve as a basis for
    interpretation or construction of this Plan.

 

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

    

    A-21

 

    10.12 Section 409A.  To the
    extent that the Committee (or the Board, in the case of awards
    granted to Independent Directors) determines that any award
    granted under the Plan is subject to Section 409A of the
    Code, the award agreement evidencing such award shall
    incorporate the terms and conditions required by
    Section 409A of the Code. To the extent applicable, the
    Plan and award agreements shall be interpreted in accordance
    with Section 409A of the Code and Department of Treasury
    regulations and other interpretive guidance issued thereunder.
    Notwithstanding any provision of the Plan to the contrary, in
    the event that the Committee (or the Board, in the case of
    awards granted to Independent Directors) determines that any
    award may be subject to Section 409A of the Code and
    related Department of Treasury guidance (including Department of
    Treasury guidance), the Committee (or the Board, in the case of
    awards granted to Independent Directors) may adopt such
    amendments to the Plan and the applicable award agreement or
    adopt other policies and procedures (including amendments,
    policies and procedures with retroactive effect), or take any
    other actions, that the Committee (or the Board, in the case of
    awards granted to Independent Directors) determines are
    necessary or appropriate to (a) exempt the award from
    Section 409A of the Code
    and/or
    preserve the intended tax treatment of the benefits provided
    with respect to the award, or (b) comply with the
    requirements of Section 409A of the Code and related
    Department of Treasury guidance.

    

    A-22exv4w1

Exhibit 4.1

 

Brown-Forman Corporation

Nonqualified Savings Plan

(a/k/a Executive Savings Plan)

Effective as of January 1, 2011

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 

	PREAMBLE	 	 	1	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 1 — GENERAL	 	 	1	 
	 	1.1	 	 	Plan Name and Sponsor
	 	 	1	 
	 	1.2	 	 	Other Participating Employers
	 	 	1	 
	 	1.3	 	 	Effective Date
	 	 	1	 
	 	1.4	 	 	Administator
	 	 	1	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 2 — DEFINITIONS	 	 	2	 
	 	2.1	 	 	Account
	 	 	2	 
	 	2.2	 	 	Administrator
	 	 	2	 
	 	2.3	 	 	Beneficiary
	 	 	2	 
	 	2.4	 	 	Board or Board of Directors
	 	 	2	 
	 	2.5	 	 	Bonus
	 	 	2	 
	 	2.6	 	 	Change in Control
	 	 	2	 
	 	2.7	 	 	Code
	 	 	2	 
	 	2.8	 	 	Compensation
	 	 	2	 
	 	2.9	 	 	Disability
	 	 	2	 
	 	2.10	 	 	Election Form
	 	 	3	 
	 	2.11	 	 	Eligible Employee
	 	 	3	 
	 	2.12	 	 	Employer
	 	 	3	 
	 	2.13	 	 	ERISA
	 	 	3	 
	 	2.14	 	 	Identification Date
	 	 	3	 
	 	2.15	 	 	Key Employee
	 	 	3	 
	 	2.16	 	 	Participant
	 	 	3	 
	 	2.17	 	 	Plan
	 	 	3	 
	 	2.18	 	 	Plan Year
	 	 	3	 
	 	2.19	 	 	Related Employer
	 	 	3	 
	 	2.20	 	 	Retirement
	 	 	3	 
	 	2.21	 	 	Separation from Service
	 	 	4	 
	 	2.22	 	 	Unforeseeable Emergency
	 	 	5	 
	 	2.23	 	 	Valuation Date
	 	 	5	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 3 — PARTICIPATION	 	 	5	 
	 	3.1	 	 	Participation
	 	 	5	 
	 	3.2	 	 	Termination of Participation
	 	 	5	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 4 — PARTICIPANT ELECTIONS	 	 	5	 
	 	4.1	 	 	Amount of Deferrals
	 	 	5	 
	 	4.2	 	 	Election Form
	 	 	6	 
	 	4.3	 	 	Election Period; Timing of Election to Defer
	 	 	6	 
	 	4.4	 	 	Election of Payment Timing and Form of Payment
	 	 	8	 
	 	4.5	 	 	Plan-Specific Limits on Payment Timing and Form Elections
	 	 	8	 

i

 

	 	 	 	 	 	 	 	 	 

	ARTICLE 5 — EMPLOYER CONTRIBUTIONS	 	 	10	 
	 	5.1	 	 	Matching Make-Up Contributions
	 	 	10	 
	 	5.2	 	 	Other Contributions
	 	 	10	 
	 	5.3	 	 	Timing of Employer Contributions
	 	 	10	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 6 — ACCOUNTS AND CREDITS	 	 	10	 
	 	6.1	 	 	Establishment of Account
	 	 	10	 
	 	6.2	 	 	Credits to Account
	 	 	11	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 7 — INVESTMENT OF CONTRIBUTIONS	 	 	11	 
	 	7.1	 	 	Investment Options
	 	 	11	 
	 	7.2	 	 	Adjustment of Accounts
	 	 	11	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 8 — RIGHT TO BENEFITS	 	 	11	 
	 	8.1	 	 	Vesting
	 	 	11	 
	 	8.2	 	 	Beneficiaries
	 	 	11	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 9 — DISTRIBUTION OF BENEFITS	 	 	12	 
	 	9.1	 	 	Amount of Benefits
	 	 	12	 
	 	9.2	 	 	Subsequent Changes in the Method and Timing of Distributions
	 	 	12	 
	 	9.3	 	 	Unforeseeable Emergency
	 	 	12	 
	 	9.4	 	 	Required Delay in Payment to Key Employees
	 	 	13	 
	 	9.5	 	 	Change in Control
	 	 	14	 
	 	9.6	 	 	Permissible Delays in Payment
	 	 	17	 
	 	9.7	 	 	Permitted Acceleration of Payment
	 	 	17	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 10 — AMENDMENT AND TERMINATION	 	 	18	 
	 	10.1	 	 	Amendment by Plan Sponsor
	 	 	18	 
	 	10.2	 	 	Plan Termination Following Change in Control or Corporate Dissolution
	 	 	18	 
	 	10.3	 	 	Other Plan Terminations
	 	 	19	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 11 — THE TRUST	 	 	19	 
	 	11.1	 	 	Establishment of Trust
	 	 	19	 
	 	11.2	 	 	Grantor Trust
	 	 	19	 
	 	11.3	 	 	Investment of Trust Funds
	 	 	20	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 12 — PLAN ADMINISTRATION	 	 	20	 
	 	12.1	 	 	Powers and Responsibilities of the Administrator
	 	 	20	 
	 	12.2	 	 	Claims and Review Procedures
	 	 	20	 
	 	12.3	 	 	Plan Administrative Costs
	 	 	21	 
	 	 	 	 	 
	 	 	 	 
	ARTICLE 13 — MISCELLANEOUS	 	 	22	 
	 	13.1	 	 	Unsecured General Creditor of the Employer
	 	 	22	 
	 	13.2	 	 	Employer’s Liability
	 	 	22	 
	 	13.3	 	 	Limitation of Rights
	 	 	22	 

ii

 

	 	 	 	 	 	 	 	 	 

	 	13.4	 	 	Anti-Assignment
	 	 	22	 
	 	13.5	 	 	Facility of Payment
	 	 	22	 
	 	13.6	 	 	Notices
	 	 	23	 
	 	13.7	 	 	Tax Withholding
	 	 	23	 
	 	13.8	 	 	Indemnification
	 	 	23	 
	 	13.9	 	 	Successors
	 	 	24	 
	 	13.10	 	 	Disclaimer
	 	 	24	 
	 	13.11	 	 	Governing Law
	 	 	24	 

iii

 

PREAMBLE

The Plan is intended to be a “plan which is unfunded and is maintained by an employer primarily for
the purpose of providing deferred compensation for a select group of management or highly
compensated employees” within the meaning of Sections 201(2), 301(a)(3) and 401(a)(1) of the
Employee Retirement Income Security Act of 1974. The Plan is further intended to conform with the
requirements of Internal Revenue Code Section 409A and the final regulations issued thereunder and
shall be interpreted, implemented and administered in a manner consistent therewith.

ARTICLE 1 — GENERAL

	1.1	 	Plan Name and Sponsor. The Plan will be referred to as either the Brown-Forman Nonqualified
Savings Plan, or the Brown-Forman (or “BF”) Executive Savings Plan, adopted by Brown-Forman
Corporation as the Plan Sponsor, 850 Dixie Highway, Louisville, Kentucky 40210, 502-585-1100,
EIN: 61-0143150, with a Fiscal Year from May 1 through April 30.
	 
	1.2	 	Other Participating Employers. The following entities have been authorized by the Plan
Sponsor to participate in and have adopted the Plan. Of the participating Employers, only the
Plan Sponsor has a class of securities traded on a public securities market.

Brown-Forman Corporation (“Plan Sponsor”)

AMG Trading L.L.C.

Brown-Forman Italy, Inc.

Brown-Forman Thailand

Brown-Forman Worldwide, L.L.C.

Early Times Distillers Company

Fetzer Vineyards

Heddon’s Gate Investments, Inc.

Jack Daniel’s Properties, Inc.

Jack Daniel Distillery, Lem Motlow, Prop., Inc.

Sonoma-Cutrer Vineyards, Inc.

Southern Comfort Properties, Inc.

Washington Investments, LLC

Woodford Reserve Stables, L.L.C.

	1.3	 	Effective Date. The Plan shall be effective for deferrals beginning January 1, 2011, based on
elections made in the first enrollment period described in Article 4.
	 
	1.4	 	Administrator. The Plan Sponsor has designated the Employee Benefits Committee (EBC) of
Brown-Forman Corporation, as appointed from time to time by the Compensation Committee of the
Board of Directors (except with respect to decisions affecting benefits of individual members
of the EBC or “named executive officers” within the meaning given in item 402(a)(3) of
Regulation S-K as promulgated by the Securities and Exchange Commission, with respect to whom
discretionary decisions shall

1

 

	 	 	be reserved to the Compensation Committee of the Board of Directors of the Plan Sponsor) as
the parties responsible for the administration of the Plan.

ARTICLE 2 — DEFINITIONS

Pronouns used in the Plan are in the masculine gender but include the feminine gender unless the
context clearly indicates otherwise. Wherever used herein, the following terms have the meanings
set forth below, unless a different meaning is clearly required by the context:

	2.1	 	“Account” means an account established for the purpose of recording amounts credited on
behalf of a Participant and any income, expenses, gains, losses or distributions included
thereon, and shall be subdivided for record keeping purposes as appropriate to separately
track portions in Subaccounts for amounts distributable at specified date(s) versus after
Separation from Service or Retirement. The Account shall be a bookkeeping entry only and
shall be utilized solely as a device for the measurement and determination of the amounts to
be paid to a Participant or to the Participant’s Beneficiary pursuant to the Plan.
	 
	2.2	 	“Administrator” means the person or persons designated by the Plan Sponsor in Section 1.4 to
be responsible for the administration of the Plan.
	 
	2.3	 	“Beneficiary” means the persons, trusts, estates or other entities entitled under Section 8.2
to receive benefits under the Plan upon the death of a Participant.
	 
	2.4	 	“Board” or “Board of Directors” means the Board of Directors of the Plan Sponsor.
	 
	2.5	 	“Bonus” means an amount of incentive remuneration payable by the Employer to a Participant.
	 
	2.6	 	“Change in Control” means the occurrence of an event involving the Plan Sponsor that is
described in Section 9.5.
	 
	2.7	 	“Code” means the Internal Revenue Code of 1986, as amended.
	 
	2.8	 	“Compensation” means, for purposes of determining Participant contributions under Article 4
and Employer contributions under Article 5, Base Salary (which term also includes annual
Holiday bonus), plus Bonuses (which includes Short-Term Incentive Plan and, effective in 2012,
Long Term Incentive Plan bonuses payable in cash), the latter two of which will be treated
hereunder as “performance-based compensation” as defined in Section 409A of the Code.
	 
	2.9	 	“Disability” means a determination by the Administrator that the Participant is either (a)
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 (b) is, by reason of any medically
determinable physical or mental impairment which can be

2

 

	 	 	expected to result in death or last for a continuous period of not less than twelve months,
receiving income replacement benefits for a period of not less than three months under an
accident and health plan covering employees of the Employer. A Participant will be
considered to have incurred a Disability if he is determined to be totally disabled by the
Social Security Administration or the Railroad Retirement Board.
	 
	2.10	 	“Election Form” means the form or electronic enrollment process established from time to time
by the Administrator that a Participant uses to make a deferral election under the Plan, and
to designate when first eligible hereunder a payment timing and form election as among the
options available for Accounts (or Subaccounts), and to designate in advance of any Plan Year
that some or all of the Account credits for that Plan Year should be allocated to a Scheduled
Date Subaccount.
	 
	2.11	 	“Eligible Employee” means those Employees of the Employer designated by the Administrator in
its sole discretion from among those employees eligible for the Employer’s Long Term Incentive
Plan.
	 
	2.12	 	“Employer” means the Plan Sponsor and the other Related Employers listed in Section 1.2 or
which in fact, with the Plan Sponsor’s permission, adopt the Plan.
	 
	2.13	 	“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
	 
	2.14	 	“Identification Date” means December 31, the date as of which Key Employees are determined.
	 
	2.15	 	“Key Employee” means an employee who satisfies the conditions set forth in Section 9.4.
	 
	2.16	 	“Participant” means an Eligible Employee who commences participation in the Plan in
accordance with Article 3.
	 
	2.17	 	“Plan” means the unfunded plan of deferred compensation set forth herein, including any
trust agreement, as adopted by the Plan Sponsor and as amended from time to time.
	 
	2.18	 	“Plan Year” means the calendar year.
	 
	2.19	 	“Related Employer” means the Employer and each other corporation or other organization that
is deemed to be a single employer with an Employer under Section 414(b) or (c) of the Code
(i.e., as part of a controlled group of corporations that includes an Employer or
under common control with an Employer).
	 
	2.20	 	“Retirement” means a Separation from Service that occurs on or after the Participant attains
age 55 with 5 or more years of service. For this purpose, a year of service shall include all
service performed for the Employer and shall include service performed for all Related
Employers, computed in accordance with elapsed time from date of hire.

3

 

	2.21	 	“Separation from Service” means the date the Employer and Participant reasonably anticipate
that the Participant will perform no further services (or that the level of services will
decline to the extent provided below) with respect to all entities comprising the Related
Employer, provided, however, that solely for purposes of this definition, in determining the
Related Employers, “at least 50 percent” shall be substituted for each reference to “at least
80 percent” that is contained in Code Section 1563(a)(1), (2), and (3) and in Reg. Sec.
1.414(c)-2. A Separation from Service does not occur if the Participant is on military
leave, sick leave or other bona fide leave of absence if the period of leave does not exceed
six months or such longer period during which the Participant’s right to re-employment is
provided by statute or contract. If the period of leave exceeds six months and the
Participant’s right to re-employment is not provided either by statute or contract, a
Separation from Service will be deemed to have occurred on the first day following the
six-month period. If the level of bona fide services the Participant would perform after such
date (whether as an employee or as an independent contractor) would permanently decrease to no
more than 20 percent of the average level of bona fide services performed (whether as an
employee or an independent contractor) over the immediately preceding 36 month period (or the
full period of services to the Related Employer if the employee has been providing services to
the Related Employer for less than 36 months), a Separation from Service shall be deemed to
have occurred.
	 
	 	 	An independent contractor is considered to have experienced a Separation from Service with
the Related Employer upon the expiration of the contract (or, in the case of more than one
contract, all contracts) under which services are performed for the Related Employer if the
expiration constitutes a good-faith and complete termination of the contractual
relationship.
	 
	 	 	If a Participant provides services as both an employee and an independent contractor of the
Related Employer, the Participant must separate from service both as an employee and as an
independent contractor to be treated as having incurred a Separation from Service. If a
Participant ceases providing services as an independent contractor and begins providing
services as an employee, or ceases providing services as an employee and begins providing
services as an independent contractor, the Participant will not be considered to have
experienced a Separation from Service until the Participant has ceased providing services in
both capacities.
	 
	 	 	If a Participant provides services both as an employee and as a member of the board of
directors of a corporate Related Employer (or an analogous position with respect to a
noncorporate Related Employer), the services provided as a director are not taken into
account in determining whether the Participant has incurred a Separation from Service as an
employee for purposes of a nonqualified deferred compensation plan in which the Participant
participates as an employee that is not aggregated under Code Section 409A with any plan in
which the Participant participates as a director.
	 
	 	 	If a Participant provides services both as an employee and as a member of the board of
directors of a corporate related Employer (or an analogous position with respect to a
noncorporate Related Employer), the services provided as an employee are not taken into

4

 

	 	 	account in determining whether the Participant has experienced a Separation from Service as
a director for purposes of a nonqualified deferred compensation plan in which the
Participant participates as a director that is not aggregated under Code Section 409A with
any plan in which the Participant participates as an employee.
	 
	 	 	If a Participant works in a division or subsidiary, and substantial assets related to
Participant’s service are sold by a Related Employer in a transaction that would otherwise
result in a Separation from Service, the affected Related Employer has reserved the
discretion to agree in a bona fide, arms’ length transaction with a buyer of such assets for
whom the Participant(s) will provide services after the closing, that such transaction does
not constitute a Separation from Service with respect to any such Participants, all in
accordance with Reg. Sec. 1.409A-1(h)(4).
	 
	 	 	All determinations of whether a Separation from Service has occurred will be made in a
manner consistent with Code Section 409A and the final regulations thereunder.
	 
	2.22	 	“Unforeseeable Emergency” means a severe financial hardship of the Participant resulting from
a sudden and unexpected illness or accident of the Participant, the Participant’s spouse, or
the Participant’s dependent (as defined in Code Section 152, without regard to Code section
152(b)(i), (b)(2) and (d)(i)(B); 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.
	 
	2.23	 	“Valuation Date” means the last day of each month in a Plan Year, and such additional date(s)
as the Administrator may determine feasible from time to time.

ARTICLE 3 — PARTICIPATION

	3.1	 	Participation. The Participants in the Plan shall be employees of the Employer who satisfy
the requirements of Section 2.11.
	 
	3.2	 	Termination of Participation. The Administrator may terminate a Participant’s participation
in the Plan in a manner consistent with Code Section 409A (generally, only with the effect of
ceasing elected deferrals as of the Plan Year-end of such action). If the Employer terminates
a Participant’s participation before the Participant experiences a Separation from Service,
the Participant’s vested Accounts shall still be paid in accordance with the provisions of
Article 9 as if participation continued.

ARTICLE 4 — PARTICIPANT ELECTIONS

	4.1	 	Amount of Deferrals. Participant may elect within the period specified in Section 4.2 to
defer the following amounts of various types of Compensation:

5

 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	% Amount	 	 
	 	 	Min	 	Max	 	Increment
	Base Salary (which includes
Holiday Bonus)
	 	 	0	%	 	 	50	%	 	 	1	%
	STIP
	 	 	0	%	 	 	75	%	 	 	1	%
	LTIP
	 	 	0	%	 	 	75	%	 	 	1	%

	4.2	 	Election Form. Each Eligible Employee may elect to defer his Compensation by submitting an
Election Form in accordance with rules and procedures established by the Administrator and the
provisions of this Article 4. A new Election Form must be timely submitted for each Plan Year
during which the Eligible Employee desires to defer Compensation. An Eligible Employee who
does not timely submit an Election Form shall be deemed to have elected zero deferrals of
Compensation for such Plan Year. An Election Form may be changed or revoked during the
specified deferral election period, and except as provided in Section 9.3 or in Section
4.3(e), a deferral agreement becomes irrevocable at the close of the specified election
period.
	 
	4.3	 	Election Period; Timing of Election to Defer.

	 	(a)	 	General Rules. Each Eligible Employee who desires to defer Compensation
otherwise payable during a Plan Year must submit an Election Form within the period
preceding the Plan Year specified below. Each Eligible Employee who desires to defer
Compensation that is a Bonus must submit an Election Form within the period preceding
the Plan Year during which the Bonus is earned that is specified below, except that if
the Bonus can be treated as performance based compensation as described in Code Section
409A(a)(4)(B)(iii), the Election Form may be submitted within the period that ends no
later than six months prior to the end of the period during which the Bonus is earned,
provided the Participant has performed services continuously from the later of the
beginning of the performance period or the date the performance criteria are
established and through the date the Participant submitted the Election Form and
provided further that the compensation has not yet become ‘readily ascertainable’
within the meaning of Reg. Sec 1.409A-2(a)(8). In addition, if the Compensation
qualifies as ‘fiscal year compensation’ within the meaning of Reg. Sec. 1.409A
-2(a)(6), the Election Form may be submitted not later than the end of the Employer’s
taxable year immediately preceding the first taxable year of the Employer in which any
services are performed for which such Compensation is payable.
	 
	 	(b)	 	Performance-Based Compensation Election Period. There shall be a special
election period ending no later than October 31 with respect to STIP and LTIP payable
with respect to a performance period ending the next April 30 fiscal year end. The
first such election period with respect to LTIP shall end on October 31, 2011, since
the amount payable in 2012 with respect to the performance period May 1, 2009-April
30, 2012 is the first LTIP eligible for deferral hereunder. The special election
period will start at a date determined by the Employer within the timing guideline set
forth above.

6

 

	 	(c)	 	Non-Performance-Based Compensation Election Period. The election period for
non-performance-based compensation shall begin and end on the same dates as for
performance-based compensation, to relate to Base Salary earned in the calendar year
beginning after the election period ends, but elections made during this election
period may be revised, if and to the extent the Administrator so allows, in accordance
with Section 4.3(e).
	 
	 	(d)	 	Newly Eligible Participants. Except as otherwise provided below, an employee
who is classified or designated as an Eligible Employee during a Plan Year may elect to
defer Compensation otherwise payable during the remainder of such Plan Year in
accordance with the rules of this Section 4.2 by submitting an Election Form within the
30 day period beginning on the effective date (which shall always be a future date) of
the employee’s eligibility pursuant to Administrator action to designate him as an
Eligible Employee. If Compensation is based on a specified performance period that
begins before the newly-Eligible Employee submits his Election Form, the election may
apply only to the portion of such Compensation equal to the total amount of
Compensation for the performance period multiplied by the ratio of the number of days
remaining in the performance period after the election becomes irrevocable and
effective over the total number of days in the performance period. The rules of this
paragraph shall not apply unless the Eligible Employee can be treated as initially
eligible in accordance with Reg. Sec. 1.409A-2(a)(7), which generally provides that
this special election period shall not apply to Participants in this Plan who were,
prior to eligibility hereunder, made eligible in any other plans of the Employer that
must be aggregated with this Plan under Code Section 409A, and shall not apply to a
Participant whose eligibility to defer under this Plan started, then ceased, then was
renewed again, unless that Participant was not able to defer Compensation under this
and all aggregated plans (if any) for the previous 24 months or longer.
	 
	 	 	 	For this Plan, in order to avoid the pro ration of deferrals per the above
requirements, an employee who is first classified or designated an Eligible Employee
during a Plan Year (or fiscal year, with respect to “fiscal year compensation” such
as STIP and LTIP) may elect to defer Compensation which is Base Salary only to the
extent earned during the remainder of the Plan Year after the effective date of his
eligibility, and after completion of an irrevocable Election Form within the time
period provided above. New Eligible Employees may elect to defer Compensation that
is STIP or LTIP only with respect to fiscal performance periods beginning on or
after their date of Plan eligibility.
	 
	 	(e)	 	Revocation of Deferral Agreement. A Participant’s Election Form will be
automatically cancelled for the greater of 6 months after, or the remainder of any Plan
Year during which he receives a hardship distribution of elective deferrals from a
qualified cash or deferred arrangement maintained by the Employer. If cancellation
occurs, the Participant may resume participation in a later Plan Year,

7

 

	 	 	 	for Compensation payable at least 6 months following the hardship withdrawal,
accordance with Article 4 of the Plan.
	 
	 	 	 	In addition, to the extent permitted by the Administrator, an Election Form
regarding a future calendar year’s Base Salary which is made during an election
period ending on October 31, may be changed by a Participant, and does not become
irrevocable until December 31 of the year before the year to which the Base Salary
relates.

	4.4	 	Election of Payment Timing and Form of Payment. All elections of a payment schedule and a
form of payment will be made in accordance with rules and procedures established by the
Administrator, consistent with the provisions of this Section 4.4 and Section 4.5. At the
time an Eligible Employee completes each Election Form, the Eligible Employee must elect a
Subaccount to which amounts credited to his Account in the next Plan Year will be allocated,
and the Subaccount to which allocated will determine the time and form of payment of such
amount from among the options the Plan Sponsor has made available for this purpose and which
are specified in Section 4.5 below. Prior to the time required by Reg. Sec. 1.409A-2, if not
dictated by the terms of any Employer grant of contributions, the Eligible Employee shall
elect a Subaccount for any Employer contributions that may be credited to the Participant’s
Account during the Plan Year, except that a Scheduled Date Subaccount shall be available only
if the related specified date for payment is after the date all such amounts are vested.
	 
	4.5	 	Plan-Specific Limits on Payment Timing and Form Elections.

	 	(a)	 	Timing of Distributions. All distributions shall be made (or begin, if payable
in installments) at a “payment date” which will be in the 30-day period after the end
of the month following the applicable date for each Subaccount established for a
Participant hereunder, at the value as of the last Valuation Date before payment. The
date applicable to each Subaccount shall be designated as either

	 	(i)	 	a specific year (the “applicable date” for which shall always
be January 1, so that payments thereof will always be in the month of February)
at least 2 years following the end of the Plan Year in which a contribution is
credited hereunder, with respect to one or more such Subaccounts of a
Participant (a “Scheduled Date Subaccount”), or
	 
	 	(ii)	 	6 months following the Separation from Service for all amounts
not yet paid at that date (into which Subaccount shall then be combined any
Scheduled Date Subaccounts for which the specified payment date has not been
reached) (a “Retirement Subaccount”).

	 	 	 	If an Eligible Employee fails to designate a Subaccount for allocation of any
amount, he shall be deemed to have elected that such amount be allocated to the
Retirement Subaccount. Notwithstanding the applicable date that otherwise applies
to a particular Subaccount, (i) in the case of death, the applicable date

8

 

	 	 	 	shall be accelerated to the date as soon as death is confirmed and the Beneficiary
identified, and the entire Account shall be paid in a single lump sum (with any
remaining installment payments accelerated) to a date in no event later than 21/2
months following the end of the Plan Year in which death occurs; and (ii) the
Participant may elect, on his first Election Form (and later change that election
pursuant to Section 4.5(d) below) that, in the case of Separation from Service
following Retirement, the applicable date for a Retirement Subaccount (and all
Scheduled Date Subaccounts then combined therewith as provided above) shall be a
later date, designated between 6 months following Separation from Service and 10
years and 6 months following Separation from Service. In no event shall the
applicable date for Retirement have the effect of delaying payment of Scheduled Date
Subaccounts to a date later than originally specified, unless further delay of the
applicable date for such Subaccount was elected in accordance with 4.5(c) or
acceleration or delay is allowed in accordance with Article 9.
	 
	 	(b)	 	Distribution Form. Each Subaccount shall also have, on the Election Form under
which it is first created, a designated form of payment of either a single lump sum, or
installments payable annually over a specific period between 2 and 10 years, provided
that, any designation of installments shall be void and of no effect if the
Participant’s Separation from Service occurs before Retirement. Any Retirement
Subaccount shall be deemed to have elected a lump sum, at the earliest permissible
payment date, unless specifically elected on the Participant’s first Election Form (or
later changes pursuant to subsection (c) below). Installments after the first one will
be paid annually on or about February 15 in each successive year. So, for example, a
Participant who has elected installments over 5 years beginning at the earliest
possible date after Retirement, and who retires on March 10, shall be paid one
installment within 30 days after the end of the month in which the 6 month anniversary
of Retirement occurs (i.e, during the month of October of that year) of
1/5th of the Account, and 1/4th of the then-remaining Account
shall then be paid on or about February 15 in the next calendar year, and future
substantially-equal installments on February 15 each of the next 3 years.
	 
	 	(c)	 	Distribution Election Change. A Participant shall be permitted to modify a
scheduled distribution date and/or payment form option in accordance with Section 9.2
of the Plan but such deferral shall apply only in accordance with the Plan-specific
limits above, and only with respect to payments triggered by Separation from Service
after Retirement or with respect to a Scheduled Date Subaccount (provided that change
in a Scheduled Date Subaccount’s applicable date shall not override the requirement
that such Subaccount be paid at the same time as the Retirement Subaccount, if the
Scheduled Date occurs after such date. Distribution election changes shall be limited
to a maximum of 2 per Subaccount, and in no event may such changes defer the payment
start date to later than 10 years and 6 months following the Separation from Service.

9

 

ARTICLE 5 — EMPLOYER CONTRIBUTIONS

	5.1	 	Matching Make-Up Contributions. The Employer shall make a contribution on behalf of each
Participant equal to 5% of “401(k)-Plan-reduced pay.” 401(k)-Plan-reduced pay shall mean the
difference between

	 	(i)	 	the Code Section 401(a)(17) compensation limit for the Plan Year, if the
Participant’s compensation eligible under the Employer’s 401(k) Plan before deferrals
hereunder are considered is above such limit, otherwise, the Participant’s 401(k)
Plan-eligible Compensation before deferral sunder this Plan, and
	 
	 	(ii)	 	the compensation of the Participant as defined in the 401(k) Plan for that
year, after such compensation has been reduced as a result of deferrals to this Plan.

	 	 	For example, if a Participant has calendar year Base Salary of $220,000 and is paid STIP in
that year of $50,000, and the Code Section 401(a)(17) compensation cap for that year is
$245,000, his Compensation for purposes of the 401(k) plan, before considering any deferrals
to this Plan, would at the Code’s compensation cap for the year because total of Base,
Holiday and STIP pay would be $270,000, well over the $245,000 Code cap. If this
Participant elected to defer 3% of his Base Salary ($6,600) and 50% of his STIP payable in
this year ($25,000) to this Plan, then the Participant’s 401(k) Plan compensation would be
reduced by a total of $31,600 in deferrals, resulting in net 401(k) Plan pay of $238,400
(270,000-31,600), thus reducing the Participant’s match potential in the 401(k) by the
difference between the Code’s Compensation Cap and this net pay (245,000 -238,400 = 6,600 in
“excess pay”) To make up for that lost 401(k) match potential, a contribution to this Plan
would be made of $330 (6,600 x 5%).
	 
	5.2	 	Other Contributions. In addition, a Participant shall receive an allocation of other
Employer contributions for the Plan Year if he is selected by the Employer in its sole
discretion to receive an allocation of other Employer contributions, the amount and vesting
requirements of which shall be determined in the Employer’s sole discretion.
	 
	5.3	 	Timing of Employer Contributions. Employer contributions shall be treated as allocated at
such time or times as the Employer shall determine in its sole discretion, but no less
frequently than once each Plan Year with respect to contributions required by Section 5.1
above, which shall be allocated to all Participants who made elective deferrals hereunder,
without regard to continued employment as of the date such contribution is made.

ARTICLE 6 — ACCOUNTS AND CREDITS

	6.1	 	Establishment of Account. For accounting and computational purposes only, the Administrator
will establish and maintain an Account (and appropriate Subaccounts) on behalf of each
Participant which will reflect the credits made pursuant to Section 6.2, distributions or
withdrawals, along with the earnings, expenses, gains and losses allocated thereto,
attributable to the hypothetical investments made with the amounts in the Account as provided
in Article 7. The Administrator will establish and maintain such

10

 

	 	 	other records and accounts, as it decides in its discretion to be reasonably required or
appropriate to discharge its duties under the Plan.
	 
	6.2	 	Credits to Account. A Participant’s Account will be credited for each Plan Year with the
amount of his elective deferrals under Section 4.1 at the time the amount subject to the
deferral election would otherwise have been payable to the Participant and the amount of
Employer contributions treated as allocated on his behalf under Article 5.

ARTICLE 7 — INVESTMENT OF CONTRIBUTIONS

	7.1	 	Investment Options. The amount credited to each Account shall be treated as invested in the
investment options designated for this purpose by the Administrator.
	 
	7.2	 	Adjustment of Accounts. The amount credited to each Account shall be adjusted for
hypothetical investment earnings, expenses, gains or losses in an amount equal to the
earnings, expenses, gains or losses attributable to the investment options from among the
investment options provided in Section 7.1. A Participant (or the Participant’s Beneficiary
after the death of the Participant) may, in accordance with rules and procedures established
by the Administrator, select the investments from among the options provided in Section 7.1 to
be used for the purpose of calculating future hypothetical investment adjustments to the
Account or to future credits to the Account under Section 6.2 effective as of the Valuation
Date coincident with or next following notice to the Administrator. Each Account shall be
adjusted as of each Valuation Date to reflect: (a) the hypothetical earnings, expenses, gains
and losses described above; (b) amounts credited pursuant to Section 6.2; and (c)
distributions or withdrawals. In addition, each Account may be adjusted for its allocable
share of the hypothetical costs and expenses associated with the maintenance of the
hypothetical investments provided in Section 7.1.

ARTICLE 8 — RIGHT TO BENEFITS

	8.1	 	Vesting. A Participant, at all times, has the 100% nonforfeitable interest in the amounts
credited to his Account attributable to his elective deferrals made in accordance with Section
4.1 and for Employer Contributions made in accordance with Section 5.1.
	 
	 	 	A Participant’s right to the amounts credited to his Account attributable to other Employer
contributions made in accordance with Section 5.2 shall be determined in if and when such a
discretionary contribution is made. If subject to vesting over time, such amounts may not be
designated as payable on a specified date prior to the date of vesting. Upon a Separation
from Service, the Participant shall forfeit any nonvested portion of his Account.
	 
	8.2	 	Beneficiaries. Upon the death of a Participant before the entire vested Account has been
paid hereunder, the remaining balance shall be paid to the Participant’s designated
Beneficiary or Beneficiaries. A Participant may designate a Beneficiary or Beneficiaries,

11

 

	 	 	or change any prior designation of Beneficiary or Beneficiaries in accordance with rules and
procedures established by the Administrator.
	 
	 	 	A copy of the death notice or other sufficient documentation must be filed with and approved
by the Administrator. If upon the death of the Participant there is, in the opinion of the
Administrator, no effective designation of Beneficiary for part or all of the Participant’s
vested Account, or no named Beneficiary(ies) has survived the Participant, such amount will
be paid to the Participant’s spouse, if any if the spouse is still living, or, if not, to
the Participant’s estate in accordance with the provisions of Article 9.

ARTICLE 9 — DISTRIBUTION OF BENEFITS

	9.1	 	Amount of Benefits. The vested amount credited to a Participant’s Account as determined
under Articles 6, 7 and 8 shall determine and constitute the basis for the value of benefits
payable to the Participant under the Plan.
	 
	9.2	 	Subsequent Changes in the Method and Timing of Distributions. Except as otherwise provided
in this Article 9, distributions under the Plan shall be made in accordance with the elections
made or deemed made by the Participant under Article 4. A Participant may elect, at least 12
months before a scheduled distribution event for a particular Subaccount (other than death or
payments triggered by Separation from Service before Retirement, for which no payment
elections are allowable hereunder), to delay the applicable date that triggers payment for a
minimum period of 60 months from the originally-scheduled date, provided the election does not
take effect for at least 12 months from the date on which the election is made. The
distribution election change must be made in accordance with procedures and rules established
by the Administrator. The Participant may, but only if the applicable date for payment is
also deferred as provided in the preceding sentence, change the form of payment as well, but
such change in the form of payment may not effect an acceleration of payment in violation of
Code Section 409A or the provisions of Reg. Sec. 1.409A-2(b). For purposes of this Section
9.2, a series of installment payments is always treated as a single payment and not as a
series of separate payments.
	 
	9.3	 	Unforeseeable Emergency. A Participant may request a distribution due to an Unforeseeable
Emergency. The request must be in writing and must be submitted to the Administrator along
with evidence that the circumstances constitute an Unforeseeable Emergency. The Administrator
has the discretion to require whatever evidence it deems necessary to determine whether a
distribution is warranted, and may require the Participant to certify that the need cannot be
met from other sources reasonably available to the Participant. Upon a withdrawal due to an
Unforeseeable Emergency, a Participant’s deferral election for the remainder of the Plan Year
will be automatically cancelled. If cancellation occurs, the Participant may resume
participation in accordance with Article 4 of the Plan.
	 
	 	 	Whether a Participant has incurred an Unforeseeable Emergency will be determined by the
Administrator on the basis of the relevant facts and circumstances in its sole

12

 

	 	 	discretion, but, in no event, will an Unforeseeable Emergency be deemed to exist if the
hardship can be relieved: (a) through reimbursement or compensation by insurance or
otherwise, (b) by liquidation of the Participant’s assets to the extent such liquidation
would not itself cause severe financial hardship, or (c) by cessation of deferrals under the
Plan.
	 
	 	 	A distribution due to an Unforeseeable Emergency must be limited to the amount reasonably
necessary to satisfy the emergency need and may include any amounts necessary to pay any
federal, state, foreign or local income taxes and penalties reasonably anticipated to result
from the distribution. The distribution will be made in the form of a single lump sum cash
payment. A Participant’s deferral elections for the remainder of the Plan Year will be
cancelled upon a withdrawal due to an Unforeseeable Emergency. If the payment of all or any
portion of the Participant’s vested Account is being delayed in accordance with Section 9.4
at the time he experiences an Unforeseeable Emergency, the amount being delayed shall not be
subject to the provisions of this Section 9.3 until the expiration of the six month period
of delay required by Section 9.5.
	 
	9.4	 	Required Delay in Payment to Key Employees. Except as otherwise provided in this Section
9.4, a distribution made on account of Separation from Service (including on account of
Retirement) at any time when the Employer or a Related Employer has stock publicly traded on
an established securities market, to a Participant who is a Key Employee as of the date of his
Separation from Service shall not be made before the date which is six months after the
Separation from Service (or Retirement, if applicable).

	 	(a)	 	Definition of Key Employee. A Participant is treated as a Key Employee if he
satisfies the requirements of Code Section 416(i)(1)(A)(i), (ii) or (iii), determined
without regard to Code Section 416(i)(5), at any time during the twelve month period
ending on the Identification Date.
	 
	 	(b)	 	Effective Date of Treatment as a Key Employee. A Participant who is a Key
Employee on an Identification Date shall be treated as a Key Employee for purposes of
the six month delay in distributions for the twelve month period beginning on the first
day of a month no later than the fourth month following the Identification Date.
	 
	 	(c)	 	Alternative Methods. The Plan Sponsor may elect to apply an alternative method
to identify Participants who will be treated as Key Employees for purposes of the six
month delay in distributions if the method satisfies each of the following
requirements. The alternative method is reasonably designed to include all Key
Employees, is an objectively determinable standard providing no direct or indirect
election to any Participant regarding its application, and results in either all Key
Employees or no more than 200 Key Employees being identified in the class as of any
date. Use of an alternative method that satisfies the requirements of this Section
9.6(c) will not be treated as a change in the time and form of payment for purposes of
Reg. Sec. 1.409A-2(b).

13

 

	 	(d)	 	6-Month Delay. The six month delay does not apply to payments described in
Section 9.7(a),(b) or (d) or to payments that occur after the death of the Participant.

	9.5	 	Change in Control. The Plan Sponsor reserves the right to terminate the Plan (or portion of
the Plan related just to a particular Related Employer and Participants in its service) and
distribute all vested amounts credited to Participant Accounts upon a Change in Control as
described in Section 9.5. If not so elected, a distribution after a Change in Control will be
made at the time specified in Section 4.5 in the form elected by the Participant in accordance
with the procedures described in Article 4, although the obligation to make such distribution
and future administration of the Plan with respect to such Participant may be agreed in
connection with a Change in Control to be transferred to another party. If a termination is
elected, the following provisions shall apply.
	 
	 	 	A Change in Control, for purposes of the Plan, will occur upon a change in the ownership of
the Plan Sponsor or another Related Employer, a change in the effective control of the Plan
Sponsor or another Related Employer to which Participant(s) provide services, or a change in
the ownership of a substantial portion of the assets of any of such Employers, including any
corporation identified in this Section 9.5, as described in more detail in this Section 9.5
below. Upon such termination, all deferrals shall cease with respect to affected
Participants.
	 
	 	 	Whether a Change in Control has occurred will be determined by the Administrator in
accordance with the rules and definitions set forth in this Section 9.5.
	 
	 	 	A distribution to the Participant will be treated as occurring upon a Change in Control if
the Plan Sponsor terminates the Plan (or related portion thereof) in accordance with Section
10.2 and distributes the Participant’s benefits within 12 months after the Employer takes
action to terminate as provided in Section 10.3.

	 	(a)	 	Relevant Corporations. To constitute a Change in Control for purposes of the
Plan, the event must relate to (i) the corporation for whom the Participant is
performing services at the time of the Change in Control, (ii) the corporation that is
liable for the payment of the Participant’s benefits under the Plan (or all
corporations liable if more than one corporation is liable) but only if either the
deferred compensation is attributable to the performance of services by the Participant
for such corporation (or corporations) or there is a bona fide business purpose for
such corporation (or corporations) to be liable for such payment and, in either case,
no significant purpose of making such corporation (or corporations) liable for such
payment is the avoidance of federal income tax, or (iii) a corporation that is a
majority shareholder of a corporation identified in (i) or (ii), or any corporation in
a chain of corporations in which each corporation is a majority shareholder of another
corporation in the chain, ending in a corporation identified in (i) or (ii). A
majority shareholder is defined as a shareholder owning more than fifty percent (50%)
of the total fair market value and voting power of such corporation.

14

 

	 	(b)	 	Stock Ownership. Code Section 318(a) applies for purposes of determining stock
ownership. Stock underlying a vested option is considered owned by the individual who
owns the vested option (and the stock underlying an unvested option is not considered
owned by the individual who holds the unvested option). If, however, a vested option
is exercisable for stock that is not substantially vested (as defined by Treasury
Regulation Section 1.83-3(b) and (j)) the stock underlying the option is not treated as
owned by the individual who holds the option.
	 
	 	(c)	 	Change in the Ownership of a Corporation. A change in the ownership of a
corporation occurs on the date that any one person or more than one person acting as a
group, acquires ownership of stock of the corporation that, together with stock held by
such person or group, constitutes more than fifty percent (50%) of the total fair
market value or total voting power of the stock of such corporation. If any one person
or more than one person acting as a group is considered to own more than fifty percent
(50%) of the total fair market value or total voting power of the stock of a
corporation, the acquisition of additional stock by the same person or persons is not
considered to cause a change in the ownership of the corporation (or to cause a change
in the effective control of the corporation as discussed below in Section 9.5(d)). An
increase in the percentage of stock owned by any one person, or persons acting as a
group, as a result of a transaction in which the corporation acquires its stock in
exchange for property will be treated as an acquisition of stock. Section 9.5(c)
applies only when there is a transfer of stock of a corporation (or issuance of stock
of a corporation) and stock in such corporation remains outstanding after the
transaction. For purposes of this Section 9.5(c), persons will not be considered to be
acting as a group solely because they purchase or own stock of the same corporation at
the same time or as a result of a public offering. Persons will, however, be
considered to be acting as a group if they are owners of a corporation that enters into
a merger, consolidation, purchase or acquisition of stock, or similar business
transaction with the corporation. If a person, including an entity, owns stock in both
corporations that enter into a merger, consolidation, purchase or acquisition of stock,
or similar transaction, such shareholder is considered to be acting as a group with
other shareholders in a corporation prior to the transaction giving rise to the change
and not with respect to the ownership interest in the other corporation.
	 
	 	(d)	 	Change in the Effective Control of a Corporation. A change in the effective
control of a corporation occurs on the date that either (i) any one person, or more
than one person acting as a group, acquires (or has acquired during the twelve month
period ending on the date of the most recent acquisition by such person or persons)
ownership of stock of the corporation possessing thirty percent (30%) or more of the
total voting power of the stock of such corporation, or (ii) a majority of members of
the corporation’s board of directors is replaced during any twelve month period by
directors whose appointment or election is not endorsed by a majority of the members of
the corporation’s board of directors prior to the date of

15

 

	 	 	 	the appointment or election, provided that for purposes of this paragraph (ii), the
term corporation refers solely to the relevant corporation identified in Section
9.5(a) for which no other corporation is a majority shareholder for purposes of
Section 9.5(a). In the absence of an event described in Section 9.5(d)(i) or (ii),
a change in the effective control of a corporation will not have occurred. A change
in effective control may also occur in any transaction in which either of the two
corporations involved in the transaction has a change in the ownership of such
corporation as described in Section 9.5(c) or a change in the ownership of a
substantial portion of the assets of such corporation as described in Section
9.5(e). If any one person, or more than one person acting as a group, is considered
to effectively control a corporation within the meaning of this Section 9.5(d), the
acquisition of additional control of the corporation by the same person or persons
is not considered to cause a change in the effective control of the corporation or
to cause a change in the ownership of the corporation within the meaning of Section
9.5(c). For purposes of this Section 9.5(d), persons will or will not be considered
to be acting as a group in accordance with rules similar to those set forth in
Section 9.5(c) with the following exception. If a person, including an entity, owns
stock in both corporations that enter into a merger, consolidation, purchase or
acquisition of stock, or similar transaction, such shareholder is considered to be
acting as a group with other shareholders in a corporation only with respect to the
ownership in that corporation prior to the transaction giving rise to the change and
not with respect to the ownership interest in the other corporation.
	 
	 	(e)	 	Change in the ownership of a substantial portion of a corporation’s assets. A
change in the ownership of a substantial portion of a corporation’s assets occurs on
the date that any one person, or more than one person acting as a group (as determined
in accordance with rules similar to those set forth in Section 9.5(d)), acquires (or
has acquired during the twelve month period ending on the date of the most recent
acquisition by such person or persons) assets from the corporation that have a total
gross fair market value equal to or more than forty percent (40%) of the total gross
fair market value of all of the assets of the corporation immediately prior to such
acquisition or acquisitions. For this purpose, gross fair market value means the value
of the assets of the corporation or the value of the assets being disposed of
determined without regard to any liabilities associated with such assets. There is no
Change in Control event under this Section 9.5(e) when there is a transfer to an entity
that is controlled by the shareholders of the transferring corporation immediately
after the transfer. A transfer of assets by a corporation is not treated as a change
in ownership of such assets if the assets are transferred to (i) a shareholder of the
corporation (immediately before the asset transfer) in exchange for or with respect to
its stock, (ii) an entity, fifty percent (50%) or more of the total value or voting
power of which is owned, directly or indirectly, by the corporation, (iii) a person, or
more than one person acting as a group, that owns, directly or indirectly, fifty
percent (50%) or more of the total value or voting power of all the outstanding stock
of the corporation, or (iv) an entity, at least fifty (50%) of the total value or
voting power of which is owned, directly or indirectly, by a person described in
Section 9.5(e)(iii). For purposes of

16

 

	 	 	 	the foregoing, and except as otherwise provided, a person’s status is determined
immediately after the transfer of assets.

	9.6	 	Permissible Delays in Payment. Distributions may be delayed beyond the date payment would
otherwise occur in accordance with the provisions of Articles 4, 8 and 9 in any of the
following circumstances as long as the Employer treats all payments to similarly situated
Participants on a reasonably consistent basis.

	 	(a)	 	The Employer may delay payment if it reasonably anticipates that its deduction
with respect to such payment would be limited or eliminated by the application of Code
Section 162(m). Payment must be made during the Participant’s first taxable year in
which the Employer reasonably anticipates, or should reasonably anticipate, that if the
payment is made during such year the deduction of such payment will not be barred by
the application of Code Section 162(m) or during the period beginning with the
Participant’s Separation from Service and ending on the later of the last day of the
Employer’s taxable year in which the Participant separates from service or the 15th day
of the third month following the Participant’s Separation from Service. If a scheduled
payment to a Participant is delayed in accordance with this Section 9.6(a), all
scheduled payments to the Participant that could be delayed in accordance with this
Section 9.6(a) will also be delayed.
	 
	 	(b)	 	The Employer may also delay payment if it reasonably anticipates that the
making of the payment will violate federal securities laws or other applicable laws
provided payment is made at the earliest date on which the Employer reasonably
anticipates that the making of the payment will not cause such violation.
	 
	 	(c)	 	The Employer reserves the right to amend the Plan to provide for a delay in
payment upon such other events and conditions as the Secretary of the Treasury may
prescribe in generally applicable guidance published in the Internal Revenue Bulletin.

	9.7	 	Permitted Acceleration of Payment. The Employer may permit acceleration of the time or
schedule of any payment or amount scheduled to be paid pursuant to a payment under the Plan
provided such acceleration would be permitted by the provisions of Reg. Sec. 1.409A-3(j)(4)
(which regulation requires that no Participant be allowed to elect whether to exercise this
discretion with respect to such Participant’s Account), including the following events:

	 	(a)	 	Domestic Relations Order. A payment may be accelerated if such payment is made
to an alternate payee pursuant to and following the receipt and qualification of a
domestic relations order as defined in Code Section 414(p).\
	 
	 	(b)	 	Compliance with Ethics Agreements and Legal Requirements. A payment may be
accelerated as may be necessary to comply with ethics agreements with the Federal
government or as may be reasonably necessary to avoid the violation of

17

 

	 	 	 	Federal, state, local or foreign ethics law or conflicts of laws, in accordance with
the requirements of Code Section 409A.

	 	(c)	 	De Minimis Amounts. A payment may, in the Employer’s discretion, be
accelerated and paid in a lump sum if (i) the Employer exercises such discretion in
writing, (ii) the amount of the payment is not greater than the applicable dollar
amount under Code Section 402(g)(1)(B), and (iii) at the time the payment is made the
amount constitutes the Participant’s entire interest under the Plan and all other plans
that are aggregated with the Plan under Reg. Sec. 1.409A-1(c)(2).
	 
	 	(d)	 	FICA Tax. A payment may be accelerated to the extent required to pay the
Federal Insurance Contributions Act tax imposed under Code Sections 3101, 3121(a) and
3121(v)(2) of the Code with respect to compensation deferred under the Plan (the “FICA
Amount”). In general, the FICA amount with respect to both deferrals and any other
Employer contributions will be taken from wages otherwise payable to the Participant in
cash, if any are available at the time the FICA amount is due. Additionally, a payment
may be accelerated to pay the income tax on wages imposed under Code Section 3401 of
the Code on the FICA Amount and to pay the additional income tax at source on wages
attributable to the pyramiding Code Section 3401 wages and taxes. The total payment
under this subsection (d) may not exceed the aggregate of the FICA Amount and the
income tax withholding related to the FICA Amount.
	 
	 	(e)	 	Section 409A Additional Tax. A payment may be accelerated if the Plan fails to
meet the requirements of Code Section 409A; provided that such payment may not exceed
the amount required to be included in income as a result of the failure to comply with
the requirements of Code Section 409A.
	 
	 	(f)	 	Other Events. A payment may be accelerated in the Administrator’s discretion
in connection with such other events and conditions as permitted by Code Section 409A.

ARTICLE 10 — AMENDMENT AND TERMINATION

	10.1	 	Amendment by Plan Sponsor. The Plan Sponsor reserves the right to amend the Plan (for itself
and each Employer) through action of its Board of Directors. No amendment can directly or
indirectly deprive any current or former Participant or Beneficiary of all or any portion of
his Account which had accrued and vested prior to the amendment.
	 
	10.2	 	Plan Termination Following Change in Control or Corporate Dissolution. The Plan Sponsor
reserves the right to terminate the Plan (or related portion thereof) and distribute all
amounts credited to affected Participant Accounts within the 30 days preceding or the 12
months following a Change in Control as determined in accordance with the rules set forth in
Section 9.5. To the extent required by Reg. Sec. 1.409A-3(j)(4)(ix)(B), the Plan (or related
portion thereof) will be treated as terminated only if all agreements, methods, programs and
other arrangements which are treated as a single plan under Reg. Sec.

18

 

	 	 	1.409A-1(c)(2) with respect to each participant therein that experienced the Change in
Control are also terminated so that all such participants under the Plan and all similar
arrangements are required to receive all amounts deferred under the terminated arrangements
within 12 months of the date the Plan Sponsor or other Related Employer irrevocably takes
all necessary action to terminate the arrangements. In addition, the Plan Sponsor reserves
the right to terminate the Plan within 12 months of a corporate dissolution taxed under Code
Section 331 or with the approval of a bankruptcy court pursuant to 11 U. S. C. Section
503(b)(1)(A) provided that amounts deferred under the Plan are included in the gross incomes
of Participants in the latest of (a) the calendar year in which the termination occurs, (b)
the first calendar year in which the amount is no longer subject to a substantial risk of
forfeiture, or (c) the first calendar year in which payment is administratively practicable.
	 
	10.3	 	Other Plan Terminations. The Plan Sponsor retains the discretion to terminate the Plan if
(a) all arrangements sponsored by the Plan Sponsor or its Related Employers that would be
aggregated with any terminated arrangement under Code Section 409A and Reg. Sec.
1.409A-1(c)(2) are terminated, (b) no payments other than payments that would be payable under
the terms of the arrangements if the termination had not occurred are made within 12 months of
the termination of the arrangements, (c) all payments are made within 24 months of the
termination of the arrangements, (d) neither the Plan Sponsor, nor its Related Employers,
adopt a new arrangement that would be aggregated with any terminated arrangement under Code
Section 409A and the regulations thereunder at any time within the three year period following
the date of termination of the arrangement, and (e) the termination does not occur proximate
to a downturn in the financial health of the Plan Sponsor.
	 
	 	 	The Plan Sponsor also reserves the right to amend the Plan to provide that termination of
the Plan will occur under such conditions and events as may be prescribed by the Secretary
of the Treasury in generally applicable guidance published in the Internal Revenue Bulletin.

ARTICLE 11 — THE TRUST

	11.1	 	Establishment of Trust. The Plan Sponsor shall establish a trust to hold amounts which the
Plan Sponsor may contribute from time to time to correspond to some or all amounts credited to
Participants under Section 6.2.
	 
	11.2	 	Grantor Trust. Any trust established by the Plan Sponsor shall be between the Plan Sponsor
and a trustee pursuant to a separate written agreement under which assets are held,
administered and managed, subject to the claims of the Plan Sponsor’s creditors in the event
of the Plan Sponsor’s insolvency. The trust is intended to be treated as a grantor trust
under the Code, and the establishment of the trust shall not cause the Participant to realize
current income on amounts contributed thereto. The Plan Sponsor must notify the trustee in
the event of a bankruptcy or insolvency.

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	11.3	 	Investment of Trust Funds. Any amounts contributed to the trust by the Plan Sponsor shall be
invested by the trustee in accordance with the provisions of the trust and the instructions of
the Administrator. Trust investments need not reflect the hypothetical investments selected
by Participants under Section 7.1 for the purpose of adjusting Accounts and the earnings or
investment results of the trust need not affect the hypothetical investment adjustments to
Participant Accounts under the Plan.

ARTICLE 12 — PLAN ADMINISTRATION

	12.1	 	Powers and Responsibilities of the Administrator. The Administrator has the full power and
the full responsibility to administer the Plan in all of its details, subject, however, to the
applicable requirements of ERISA. The Administrator’s powers and responsibilities include,
but are not limited to, the following:

	 	(a)	 	To make and enforce such rules and procedures as it deems necessary or proper
for the efficient administration of the Plan;
	 
	 	(b)	 	To interpret the Plan, its interpretation thereof to be final, except as
provided in Section 12.2, on all persons claiming benefits under the Plan;
	 
	 	(c)	 	To decide all questions concerning the Plan and the eligibility of any person
to participate in the Plan;
	 
	 	(d)	 	To administer the claims and review procedures specified in Section 12.2;
	 
	 	(e)	 	To compute the amount of benefits which will be payable to any Participant,
former Participant or Beneficiary in accordance with the provisions of the Plan;
	 
	 	(f)	 	To determine the person or persons to whom such benefits will be paid;
	 
	 	(g)	 	To authorize the payment of benefits;
	 
	 	(h)	 	To comply with the reporting and disclosure requirements of Part 1 of Subtitle
B of Title I of ERISA;
	 
	 	(i)	 	To appoint such agents, counsel, accountants, and consultants as may be
required to assist in administering the Plan;
	 
	 	(j)	 	By written instrument, to allocate and delegate its responsibilities, including
the formation of an Administrative Committee to administer the Plan.

	12.2	 	Claims and Review Procedures.

	 	(a)	 	Claims Procedure. If any person believes he is being denied any rights or
benefits under the Plan, such person may file a claim in writing with the
Administrator. If any such claim is wholly or partially denied, the Administrator

20

 

	 	 	 	will notify such person of its decision in writing. Such notification will contain
(i) specific reasons for the denial, (ii) specific reference to pertinent Plan
provisions, (iii) a description of any additional material or information necessary
for such person to perfect such claim and an explanation of why such material or
information is necessary, and (iv) a description of the Plan’s review procedures and
the time limits applicable to such procedures, including a statement of the person’s
right to bring a civil action following an adverse decision on review. Such
notification will be given within 90 days after the claim is received by the
Administrator. The Administrator may extend the period for providing the
notification by 90 days if special circumstances require an extension of time for
processing the claim and if written notice of such extension and circumstance is
given to such person within the initial 90 day period. If such notification is not
given within such period, the claim will be considered denied as of the last day of
such period and such person may request a review of his claim.
	 
	 	(b)	 	Review Procedure. Within 60 days after the date on which a person receives a
written notification of denial of claim (or, if written notification is not provided,
within 60 days of the date denial is considered to have occurred), such person (or his
duly authorized representative) may (i) file a written request with the Administrator
for a review of his denied claim and of pertinent documents and (ii) submit written
issues and comments to the Administrator. The Administrator will notify such person of
its decision in writing. Such notification will be written in a manner calculated to
be understood by such person and will contain specific reasons for the decision as well
as specific references to pertinent Plan provisions. The notification will explain
that the person is entitled to receive, upon request and free of charge, reasonable
access to and copies of all pertinent documents and has the right to bring a civil
action following an adverse decision on review.
	 
	 	 	 	The decision on review will be made within 60 days. The Administrator may extend
the period for making the decision on review by 60 days if special circumstances
require an extension of time for processing the request such as an election by the
Administrator to hold a hearing, and if written notice of such extension and
circumstances is given to such person within the initial 60-day period. If the
decision on review is not made within such period, the claim will be considered
denied.
	 
	 	(c)	 	Exhaustion of Claims Procedure and Right to Bring Legal Claim. No action in
law or equity shall be brought more than one (1) year after the Review Panel’s
affirmation of a denial of the claim, or, if earlier, more than four (4) years after
the facts or events giving rise to the claimant’s allegation(s) or claim(s) first
occurred.

	12.3	 	Plan Administrative Costs. All reasonable costs and expenses (including legal, accounting,
and employee communication fees) incurred by the Administrator in administering the Plan shall
be paid from any Trust that might then be related to the Plan, and shall reduce Participant
Accounts, to the extent not paid by the Employer.

21

 

ARTICLE 13 — MISCELLANEOUS

	13.1	 	Unsecured General Creditor of the Employer. Participants and their Beneficiaries, heirs,
successors and assigns shall have no legal or equitable rights, interests or claims in any
property or assets of the Employer. For purposes of the payment of benefits under the Plan,
any and all of the Employer’s assets shall be, and shall remain, the general, unpledged,
unrestricted assets of the Employer. Each Employer’s legal obligation under the Plan shall be
merely that of an unfunded and unsecured promise to pay money in the future.
	 
	13.2	 	Employer’s Liability. Each Employer’s liability for the payment of benefits under the Plan
shall be defined only by the Plan and by the deferral agreements entered into between a
Participant and the Employer. An Employer shall have no obligation or liability to a
Participant under the Plan except as provided by the Plan and a deferral agreement or
agreements. An Employer shall have no liability to Participants employed by other Employers
unless and until such other Employer remits contributions due for its Participants to the Plan
Sponsor.
	 
	13.3	 	Limitation of Rights. Neither the establishment of the Plan, nor any amendment thereof, nor
the creation of any fund or account, nor the payment of any benefits, will be construed as
giving to the Participant or any other person any legal or equitable right against the
Employer, the Plan or the Administrator, except as provided herein; and in no event will the
terms of employment or service of the Participant be modified or in any way affected hereby.
	 
	13.4	 	Anti-Assignment. Except as may be necessary to fulfill a domestic relations order within the
meaning of Code Section 414(p), none of the benefits or rights of a Participant or any
Beneficiary of a Participant shall be subject to the claim of any creditor. In particular, to
the fullest extent permitted by law, all such benefits and rights shall be free from
attachment, garnishment, or any other legal or equitable process available to any creditor of
the Participant and his or her Beneficiary. Neither the Participant nor his or her
Beneficiary shall have the right to alienate, anticipate, commute, pledge, encumber, or assign
any of the payments which he or she may expect to receive, contingently or otherwise, under
the Plan, except the right to designate a Beneficiary to receive death benefits provided
hereunder.
	 
	13.5	 	Facility of Payment. If the Administrator determines, on the basis of medical reports or
other evidence satisfactory to the Administrator, that the recipient of any benefit payments
under the Plan is incapable of handling his affairs by reason of minority, illness, infirmity
or other incapacity, the Administrator may direct the Employer to disburse such payments to a
person or institution designated by a court which has jurisdiction over such recipient or a
person or institution otherwise having the legal authority under State law for the care and
control of such recipient. The receipt by such person or institution of any such payments
therefore, and any such payment to the extent

22

 

	 	 	thereof, shall discharge the liability of the Employer, the Plan and the Administrator for
the payment of benefits hereunder to such recipient.
	 
	13.6	 	Notices. Any notice or other communication to the Employer or Administrator in connection
with the Plan shall be deemed delivered in writing if addressed to the Plan Sponsor at the
address specified in Article 1 and if either actually delivered at said address or, in the
case or a letter, 5 business days shall have elapsed after the same shall have been deposited
in the United States mails, first-class postage prepaid and registered or certified.
	 
	13.7	 	Tax Withholding. If the Employer concludes that tax is owing with respect to any deferral or
payment hereunder, the Employer shall withhold such amounts from any payments due the
Participant, as permitted by law, or otherwise make appropriate arrangements with the
Participant or his Beneficiary for satisfaction of such obligation. Tax, for purposes of this
Section 13.7 means any federal, state, local or any other governmental income tax, employment
or payroll tax, excise tax, or any other tax or assessment owing with respect to amounts
deferred, any earnings thereon, and any payments made to Participants under the Plan.
	 
	13.8	 	Indemnification.

	 	(a)	 	Each Indemnitee (as defined in Section 13.8(e)) shall be indemnified and held
harmless by the Employer for all actions taken by him and for all failures to take
action (regardless of the date of any such action or failure to take action), to the
fullest extent permitted by the law of the jurisdiction in which the Employer is
incorporated, against all expense, liability, and loss (including, without limitation,
attorneys’ fees, judgments, fines, taxes, penalties, and amounts paid or to be paid in
settlement) reasonably incurred or suffered by the Indemnitee in connection with any
Proceeding (as defined in Subsection (e)). No indemnification pursuant to this Section
shall be made, however, in any case where (1) the act or failure to act giving rise to
the claim for indemnification is determined by a court to have constituted willful
misconduct or recklessness or (2) there is a settlement to which the Employer does not
consent.
	 
	 	(b)	 	The right to indemnification provided in this Section shall include the right
to have the expenses incurred by the Indemnitee in defending any Proceeding paid by the
Employer in advance of the final disposition of the Proceeding, to the fullest extent
permitted by the law of the jurisdiction in which the Employer is incorporated;
provided that, if such law requires, the payment of such expenses incurred by the
Indemnitee in advance of the final disposition of a Proceeding shall be made only on
delivery to the Employer of an undertaking, by or on behalf of the Indemnitee, to repay
all amounts so advanced without interest if it shall ultimately be determined that the
Indemnitee is not entitled to be indemnified under this Section or otherwise.

23

 

	 	(c)	 	Indemnification pursuant to this Section shall continue as to an Indemnitee who
has ceased to be such and shall inure to the benefit of his heirs, executors, and
administrators. The Employer agrees that the undertakings made in this Section shall
be binding on its successors or assigns and shall survive the termination, amendment or
restatement of the Plan.
	 
	 	(d)	 	The foregoing right to indemnification shall be in addition to such other
rights as the Indemnitee may enjoy as a matter of law or by reason of insurance
coverage of any kind and is in addition to and not in lieu of any rights to
indemnification to which the Indemnitee may be entitled pursuant to the by-laws of the
Employer.
	 
	 	(e)	 	For the purposes of this Section, the following definitions shall apply:

	 	(1)	 	“Indemnitee” shall mean each person serving as an Administrator
(or any other person who is an employee, director, or officer of the Employer)
who was or is a party to, or is threatened to be made a party to, or is
otherwise involved in, any Proceeding, by reason of the fact that he is or was
performing administrative functions under the Plan.
	 
	 	(2)	 	“Proceeding” shall mean any threatened, pending, or completed
action, suit, or proceeding (including, without limitation, an action, suit, or
proceeding by or in the right of the Employer), whether civil, criminal,
administrative, investigative, or through arbitration.

	13.9	 	Successors. The provisions of the Plan shall bind and inure to the benefit of the Plan
Sponsor, the Employer and their successors and assigns and the Participant and the
Participant’s designated Beneficiaries.
	 
	13.10	 	Disclaimer. It is the Plan Sponsor’s intention that the Plan comply with the requirements of
Code Section 409A. Neither the Plan Sponsor nor the Employer shall have any liability to any
Participant should any provision of the Plan fail to satisfy the requirements of Code Section
409A.
	 
	13.11	 	Governing Law. The Plan will be construed, administered and enforced according to the laws
of the State of Delaware.

[Signature on next page]

24

 

The Plan Sponsor has caused this Plan to be executed this 23rd day of
September, 2010.

	 	 	 	 	 
	 	BROWN-FORMAN CORPORATION

 	 
	 	By:  	/s/ Lisa Steiner
 	 
	 	 	Title: SVP, Chief Human Resources Officer 	 
	 	 	 	 
	 

25

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