Document:

Exhibit 10.2 to STRATTEC April 2007 Form 10-Q

    

      Exhibit
        10.2

      

      EMPLOYMENT
        AGREEMENT

      

       

      AGREEMENT
        by and between STRATTEC SECURITY CORPORATION, a Wisconsin corporation (the
        "Company") and Brian Reetz (the "Executive"), dated as of the 1st day
        of
January,
        2007.

      

      The
        Board
        of Directors of the Company (the "Board"), has determined that it is in the
        best
        interests of the Company and its shareholders to assure that the Company
        will
        have the continued dedication of the Executive, notwithstanding the possibility,
        threat or occurrence of a Change of Control (as defined below) of the Company.
        The Board believes it is imperative to diminish the inevitable distraction
        of
        the Executive by virtue of the personal uncertainties and risks created by
        a
        pending or threatened Change of Control and to encourage the Executive's
        full
        attention and dedication to the Company currently and in the event of any
        threatened or pending Change of Control, and to provide the Executive with
        compensation and benefits arrangements upon a Change of Control which ensure
        that the compensation and benefits expectations of the Executive will be
        satisfied and which are competitive with those of other corporations. Therefore,
        in order to accomplish these objectives, the Board has caused the Company
        to
        enter into this Agreement.

      

      NOW,
        THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

      

      1.    Certain
        Definitions.
        

      

      (a)  The
        "Effective Date"
        shall mean the first date during the Change of Control Period (as defined
        in
        Section l(b)) on which a Change of Control (as defined in Section 2)
        occurs. Anything in this Agreement to the contrary notwithstanding, if a
        Change
        of Control occurs and if the Executive's employment with the Company or this
        Agreement is terminated prior to the date on which the Change of Control
        occurs,
        and if it is reasonably demonstrated by the Executive that such termination
        of
        employment or of this Agreement (i) was at the request of a third party who
        has taken steps reasonably calculated to effect a Change of Control or
        (ii) otherwise arose in connection with or anticipation of a Change of
        Control, then for all purposes of this Agreement the "Effective Date" shall
        mean
        the date immediately prior to the date of such termination of employment
        or
        purported termination of this Agreement.

      

      (b)  The
        "Change of Control Period" shall mean the period commencing on the date hereof
        and ending on the third anniversary of the date hereof; provided, however,
        that
        commencing on the date one year after the date hereof, and on each annual
        anniversary of such date (such date and each annual anniversary thereof shall
        be
        hereinafter referred to as the "Renewal Date"), unless previously terminated,
        the Change of Control Period shall be automatically extended so as to terminate
        three years from such Renewal Date, unless at least 60 days prior to the
        Renewal Date the Company shall give notice to the Executive that the Change
        of
        Control Period shall not be so extended.

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      2.    Change
        of Control.
        For the
        purpose of this Agreement, a "Change of Control" shall mean:

      

      (a)   The
        acquisition by any individual, entity or group (within the meaning of
        Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
        amended (the "Exchange Act")) (a "Person") of beneficial ownership (within
        the
        meaning of Rule 13d-3 promulgated under the Exchange Act) of 20% or more of
        either (i) the then outstanding shares of common stock of the Company (the
        "Outstanding Company Common Stock") or (ii) the combined voting power of
        the then outstanding voting securities of the Company entitled to vote generally
        in the election of directors (the "Outstanding Company Voting Securities");
        provided, however, that the following acquisitions shall not constitute a
        Change
        of Control: (i) any acquisition directly from the Company, (ii) any
        acquisition by the Company, (iii) any acquisition by any employee benefit
        plan (or related trust) sponsored or maintained by the Company or any
        corporation controlled by the Company or (iv) any acquisition by any
        corporation pursuant to a transaction which complies with clauses (i), (ii)
        and (iii) of subsection (c) of this Section 2; or

      

      (b)   Individuals
        who, as of the date hereof, constitute the Board (the "Incumbent Board")
        cease
        for any reason to constitute at least a majority of the Board; provided,
        however, that any individual becoming a director subsequent to the date hereof
        whose election, or nomination for election by the Company's shareholders,
        was
        approved by a vote of at least a majority of the directors then comprising
        the
        Incumbent Board shall be considered as though such individual were a member
        of
        the Incumbent Board, but excluding, for this purpose, any such individual
        whose
        initial assumption of office occurs as a result of an actual or threatened
        election contest with respect to the election or removal of directors or
        other
        actual or threatened solicitation of proxies or consents by or on behalf
        of a
        Person other than the Board; or

      

      (c)   Approval
        by the shareholders of the Company of a reorganization, merger or consolidation
        (a "Business Combination"), in each case, unless, following such Business
        Combination, (i) all or substantially all of the individuals and entities
        who were the beneficial owners, respectively, of the Outstanding Company
        Common
        Stock and Outstanding Company Voting Securities immediately prior to such
        Business Combination beneficially own, directly or indirectly, more than
        60% of,
        respectively, the then outstanding shares of common stock and the combined
        voting power of the then outstanding voting securities entitled to vote
        generally in the election of directors, as the case may be, of the corporation
        resulting from such Business Combination (including, without limitation,
        a
        corporation which as a result of such transaction owns the Company through
        one
        or more subsidiaries) in substantially the same proportions as their ownership,
        immediately prior to such Business Combination of the Outstanding Company
        Common
        Stock and Outstanding Company Voting Securities, as the case may be,
        (ii) no Person (excluding any employee benefit plan (or related trust) of
        the Company or such corporation resulting from such Business Combination)
        beneficially owns, directly or indirectly, 20% or more of, respectively,
        the
        then outstanding shares of common stock of the corporation resulting from
        such
        Business Combination or the combined voting power of the then outstanding
        voting
        securities of such corporation except to the extent that such ownership existed
        prior to the Business Combination and (iii) at least a majority of the
        members of the board of directors of the corporation resulting from such
        Business Combination were members of the Incumbent Board at the time of the
        execution of the initial agreement, or of the action of the Board, providing
        for
        such Business Combination; or

      
        
          
          

        

        
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      (d)   Approval
        by the shareholders of the Company of (i) a complete liquidation or
        dissolution of the Company or (ii) the sale or other disposition of all or
        substantially all of the assets of the Company, other than to a corporation,
        with respect to which following such sale or other disposition, [a] more
        than 60% of, respectively, the then outstanding shares of common stock of
        such
        corporation and the combined voting power of the then outstanding voting
        securities of such corporation entitled to vote generally in the election
        of
        directors is then beneficially owned, directly or indirectly, by all or
        substantially all of the individuals and entities who were the beneficial
        owners, respectively, of the Outstanding Company Common Stock and outstanding
        Company Voting Securities immediately prior to such sale or other disposition
        in
        substantially the same proportion as their ownership, immediately prior to
        such
        sale or other disposition, of the Outstanding Company Common Stock and
        Outstanding Company Voting Securities, as the case may be, [b] less than
        20% of, respectively, the then outstanding shares of common stock of such
        corporation and the combined voting power of the then outstanding voting
        securities of such corporation entitled to vote generally in the election
        of
        directors is then beneficially owned, directly or indirectly, by any Person
        (excluding any employee benefit plan (or related trust) of the Company or
        such
        corporation), except to the extent that such Person owned 20% or more of
        the
        Outstanding Company Common Stock or Outstanding Company Voting Securities
        prior
        to the sale or disposition, and [c] at least a majority of the members of
        the board of directors of such corporation were members of the Incumbent
        Board
        at the time of the execution of the initial agreement, or of the action of
        the
        Board, providing for such sale or other disposition of assets of the Company
        or
        were elected, appointed or nominated by the Board.

      

      3.    Employment
        Period.
        The
        Company hereby agrees to continue the Executive in its employ, and the Executive
        hereby agrees to remain in the employ of the Company subject to the terms
        and
        conditions of this Agreement, for the period commencing on the Effective
        Date
        and ending on the third an-niversary of such date (the "Employment
        Period").

      

      4.    Terms
        of Employment.
        

      

      (a)   Position
        and Duties.
        

      

      (i)    During
        the Employment Period, [a] the Executive's position (including status,
        offices, titles and reporting requirements), authority, duties and
        responsibilities shall be at least commensurate in all material respects
        with
        the most significant of those held, exercised and assigned at any time during
        the 120-day period immediately preceding the Effective Date and [b] the
        Executive's services shall be performed at the location where the Executive
        was
        employed immediately preceding the Effective Date or any office or location
        less
        than 35 miles from such location.

      

      
        
          
          

        

        
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      (ii)   During
        the Employment Period, and excluding any periods of vacation and sick leave
        to
        which the Executive is entitled, the Executive agrees to devote reasonable
        attention and time during normal business hours to the business and affairs
        of
        the Company and, to the extent necessary to discharge the responsibilities
        assigned to the Executive hereunder, to use the Executive's reasonable best
        efforts to perform faithfully and efficiently such responsibilities. During
        the
        Employment Period it shall not be a violation of this Agreement for the
        Executive to [a] serve on corporate, civic or charitable boards or
        committees, [b] deliver lectures, fulfill speaking engagements or teach at
        educational institutions and [c] manage personal investments, so long as
        such activities do not significantly interfere with the performance of the
        Executive's responsibilities as an employee of the Company in accordance
        with
        this Agreement. It is expressly understood and agreed that to the extent
        that
        any such activities have been conducted by the Executive prior to the Effective
        Date, the continued conduct of such activities (or the conduct of activities
        similar in nature and scope thereto) subsequent to the Effective Date shall
        not
        thereafter be deemed to interfere with the performance of the Executive's
        responsibilities to the Company.

      

      (b)   Compensation.

      

      (i)   Base
        Salary.
        During
        the Employment Period, the Executive shall receive an annual base salary
        ("Annual Base Salary"), which shall be paid at a monthly rate, at least equal
        to
        twelve times the highest monthly base salary paid or payable, including any
        base
        salary which has been earned but deferred, to the Executive by the Company
        and
        its affiliated companies in respect of the 12-month period immediately preceding
        the month in which the Effective Date occurs. During the Employment Period,
        the
        Annual Base Salary shall be reviewed no more than 12 months after the last
        salary increase awarded to the Executive prior to the Effective Date and
        thereafter at least annually and shall be first increased no more than
        12 months after the last salary increase awarded to the Executive prior to
        the Effective Date and thereafter at least annually by the higher of (x)
        the
        average increase (excluding promotional increases) in base salary awarded
        to the
        Executive for each of the three full fiscal years (annualized in the case
        of any
        fiscal year consisting of less than twelve full months or during which the
        Executive was employed for less than twelve months) prior to the Effective
        Date,
        and (y) the percentage increase (excluding promotional increases) in base
        salary
        generally awarded to peer executives of the Company and its affiliated companies
        for the year of determination. Any increase in Annual Base Salary shall not
        serve to limit or reduce any other obligation to the Executive under this
        Agreement. Annual Base Salary shall not be reduced after any such increase
        and
        the term Annual Base Salary as utilized in this Agreement shall refer to
        Annual
        Base Salary as so increased. As used in this Agreement, the term "affiliated
        companies" shall include any company controlled by, controlling or under
        common
        control with the Company.

      

      
        
          
          

        

        
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      (ii)   Annual
        Bonus.
        In
        addition to Annual Base Salary, the Executive shall be awarded, for each
        fiscal
        year ending during the Employment Period, an annual bonus (the "Annual Bonus")
        in cash at least equal to the higher of (x) the average of the three highest
        bonuses paid or payable, including any bonus or portion thereof which has
        been
        earned but deferred, to the Executive by the Company and its affiliated
        companies in respect of the five fiscal years (or such shorter period during
        which the Executive has been employed by the Company) immediately preceding
        the
        fiscal year in which the Effective Date occurs (annualized for any fiscal
        year
        during such period consisting of less than twelve full months or with respect
        to
        which the Executive has been employed by the Company for less than twelve
        full
        months) and (y) the bonus paid or payable (annualized as described above),
        including any bonus or portion thereof which has been earned but deferred,
        to
        the Executive by the Company and its affiliated companies in respect of the
        most
        recently completed fiscal year prior to the Effective Date (such higher amount
        being referred to as the "Recent Annual Bonus"). Each such Annual Bonus shall
        be
        paid no later than the end of the third month of the fiscal year next following
        the fiscal year for which the Annual Bonus is awarded, unless the Executive
        shall elect to defer the receipt of such Annual Bonus.

      

      (iii)   Incentive,
        Savings and Retirement Plans.
        During
        the Employment Period, the Executive shall be entitled to participate in
        all
        incentive, savings and retirement plans, practices, policies and programs
        applicable generally to other peer executives of the Company and its affiliated
        companies, but in no event shall such plans, practices, policies and programs
        provide the Executive with incentive opportunities (measured with respect
        to
        both regular and special incentive opportunities, to the extent, if any,
        that
        such distinction is applicable), savings opportunities and retirement benefit
        opportunities, in each case, less favorable, in the aggregate, than the most
        favorable of those provided by the Company and its affiliated companies for
        the
        Executive under such plans, practices, policies and programs as in effect
        at any
        time during the 120-day period immediately preceding the Effective Date or
        if
        more favorable to the Executive, those provided generally at any time after
        the
        Effective Date to other peer executives of the Company and its affiliated
        companies.

      

      (iv)   Welfare
        Benefit Plans.
        During
        the Employment Period, the Executive and/or the Executive's family, as the
        case
        may be, shall be eligible for participation in and shall receive all benefits
        under welfare benefit plans, practices, policies and programs provided by
        the
        Company and its affiliated companies (including, without limitation, medical,
        prescription, dental, disability, salary continuance, employee life, group
        life,
        accidental death and travel accident insurance plans and programs) to the
        extent
        applicable generally to other peer executives of the Company and its affiliated
        companies, but in no event shall such plans, practices, policies and programs
        provide the Executive with benefits which are less favorable, in the aggregate,
        than the most favorable of such plans, practices, policies and programs in
        effect for the Executive at any time during the 120-day period immediately
        preceding the Effective Date or, if more favorable to the Executive, those
        provided generally at any time after the Effective Date to other peer executives
        of the Company and its affiliated companies.

      

      
        
          
          

        

        
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      (v)   Expenses.
        During
        the Employment Period, the Executive shall be entitled to receive prompt
        reimbursement for all reasonable expenses incurred by the Executive in
        accordance with the most favorable policies, practices and procedures of
        the
        Company and the affiliated companies in effect for the Executive at any time
        during the 120-day period immediately preceding the Effective Date or, if
        more
        favorable to the Executive, as in effect generally at any time thereafter
        with
        respect to other peer executives of the Company and its affiliated
        companies.

      

      (vi)   Fringe
        Benefits.
        During
        the Employment Period, the Executive shall be entitled to fringe benefits,
        including, without limitation, tax and financial planning services, payment
        of
        club dues, and, if applicable, use of automobile and payment of related
        expenses, in accordance with the most favorable plans, practices, programs
        and
        policies of the Company and its affiliated companies in effect for the Executive
        at any time during the 120-day period immediately preceding the Effective
        Date
        or, if more favorable to the Executive, as in effect generally at any time
        thereafter with respect to other peer executives of the Company and its
        affiliated companies.

      

      (vii)   Office
        and Support Staff.
        During
        the Employment Period, the Executive shall be entitled to an office or offices
        of a size and with furnishings and other appointments, and to exclusive personal
        secretarial and other assistance, at least equal to the most favorable of
        the
        foregoing provided to the Executive by the Company and its affiliated companies
        at any time during the 120-day period immediately preceding the Effective
        Date
        or, if more favorable to the Executive, as provided generally at any time
        thereafter with respect to other peer executives of the Company and its
        affiliated companies.

      

      (viii)   Vacation.
        During
        the Employment Period, the Executive shall be entitled to paid vacation in
        accordance with the most favorable plans, policies, programs and practices
        of
        the Company and its affiliated companies as in effect for the Executive at
        any
        time during the 120-day period immediately preceding the Effective Date or,
        if
        more favorable to the Executive, as in effect generally at any time thereafter
        with respect to other peer executives of the Company and its affiliated
        companies.

      

      5.   Termination
        of Employment.
        

      

      (a)   Death
        or Disability.
        The
        Executive's employment shall terminate automatically upon the Executive's
        death
        during the Employment Period. If the Company determines in good faith that
        the
        Disability of the Executive has occurred during the Employment Period (pursuant
        to the definition of Disability set forth below), it may give to the Executive
        written notice in accordance with Section 12(b) of this Agreement of its
        intention to terminate the Executive's employment. In such event, the
        Executive's employment with the Company shall terminate effective on the
        30th
        day after receipt of such notice by the Executive (the "Disability Effective
        Date"), provided that, within the 30 days after such receipt, the Executive
        shall not have returned to full-time performance of the Executive's duties.
        For
        purposes of this Agreement, "Disability" shall mean the absence of the Executive
        from the Executive's duties with the Company on a full-time basis for 180
        consecutive business days as a result of incapacity due to mental or physical
        illness which is determined to be total and permanent by a physician selected
        by
        the Company or its insurers and acceptable to the Executive or the Executive's
        legal representative (such agreement as to acceptability not to be withheld
        unreasonably).

      

      
        
          
          

        

        
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      (b)   Cause.
        The
        Company may terminate the Executive's employment during the Employment Period
        for Cause. For the sole and exclusive purposes of this Agreement, "Cause"
        shall
        mean:

      

      (i)   The
        willful and continued failure of the Executive to perform substantially the
        Executive's duties with the Company or one of its affiliates (other than
        any
        such failure resulting from incapacity due to physical or mental illness),
        after
        a written demand for substantial performance is delivered to the Executive
        by
        the Board or the Chief Executive Officer of the Company which specifically
        identifies the manner in which the Board or Chief Executive Officer believes
        that the Executive has not substantially performed the Executive's duties,
        or

      

      (ii)   The
        willful engaging by the Executive in illegal conduct or gross misconduct
        which
        is materially and demonstrably injurious to the Company.

      

      For
        purposes of this provision, no act or failure to act, on the part of the
        Executive, shall be considered "willful" unless it is done, or omitted to
        be
        done, by the Executive in bad faith or without reasonable belief that the
        Executive's action or omission was in the best interests of the Company.
        Any
        act, or failure to act, based upon authority given pursuant to a resolution
        duly
        adopted by the Board or upon the instructions of the Chief Executive Officer
        or
        a senior officer of the Company or based upon the advice of counsel for the
        Company shall be conclusively presumed to be done, or omitted to be done,
        by the
        Executive in good faith and in the best interests of the Company. The cessation
        of employment of the Executive shall not be deemed to be for Cause unless
        and
        until there shall have been delivered to the Executive a copy of a resolution
        duly adopted by the affirmative vote of not less than three-quarters of the
        entire membership of the Board at a meeting of the Board called and held
        for
        such purpose (after reasonable notice is provided to the Executive and the
        Executive is given an opportunity, together with counsel, to be heard before
        the
        Board), finding that, in the good faith opinion of the Board, the Executive
        is
        guilty of the conduct described in subparagraph (i) or (ii) above, and
        specifying the particulars thereof in detail.

      

      (c)   Good
        Reason.
        The
        Executive's employment may be terminated by the Executive for Good Reason.
        For
        the sole and exclusive purposes of this Agreement, "Good Reason" shall
        mean:

      

      (i)   The
        assignment to the Executive of any duties inconsistent in any respect with
        the
        Executive's position (including status, offices, titles and reporting
        requirements), authority, duties or responsibilities as contemplated by
        Section 4(a) of this Agreement, or any other action by the Company which
        results in a diminution in such position, authority, duties or responsibilities,
        excluding for this purpose an isolated, insubstantial and inadvertent action
        not
        taken in bad faith and which is remedied by the Company promptly after receipt
        of notice thereof given by the Executive;

      

      
        
          
          

        

        
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      (ii)   Any
        failure by the Company to comply with any of the provisions of Section 4(b)
        of this Agreement, other than an isolated, insubstantial and inadvertent
        failure
        not occurring in bad faith and which is remedied by the Company promptly
        after
        receipt of notice thereof given by the Executive;

      

      (iii)   The
        Company's requiring the Executive to be based at any office or location other
        than as provided in Section 4(a)(i)(b) hereof or the Company's requiring
        the Executive to travel on Company business to a substantially greater extent
        than required immediately prior to the Effective Date;

      

      (iv)   Any
        purported termination by the Company of the Executive's employment otherwise
        than as expressly permitted by this Agreement; or

      

      (v)   Any
        failure by the Company to comply with and satisfy Section 11(c) of this
        Agreement.

      

      For
        purposes of this Section 5(c), any good faith determination of "Good
        Reason" made by the Executive shall be conclusive. Anything in this Agreement
        to
        the contrary notwithstanding, a termination by the Executive for any reason
        during the 30-day period immediately following the first anniversary of the
        Effective Date shall be deemed to be a termination for Good Reason for all
        purposes of this Agreement.

      

      (d)   Notice
        of Termination.
        Any
        termination by the Company for Cause, or by the Executive for Good Reason,
        shall
        be communicated by Notice of Termination to the other party hereto given
        in
        accordance with Section 12(b) of this Agreement. For purposes of this
        Agreement, a "Notice of Termina-tion" means a written notice which
        (i) indicates the specific termination provision in this Agreement relied
        upon, (ii) to the extent applicable, sets forth in reasonable detail the
        facts and circumstances claimed to provide a basis for termination of the
        Executive's employment under the provision so indicated, and (iii) if the
        Date of Termination (as defined below) is other than the date of receipt
        of such
        notice, specifies the termination date (which date shall be not more than
        thirty
        days after the giving of such notice). The failure by the Executive or the
        Company to set forth in the Notice of Termination any fact or circumstance
        which
        contributes to a showing of Good Reason or Cause shall not waive any right
        of
        the Executive or the Company, respectively, hereunder or preclude the Executive
        or the Company, respectively, from asserting such fact or circumstance in
        enforcing the Executive's or the Company's rights hereunder.

      

      (e)   Date
        of Termination.
        "Date
        of Termination" means (i) if the Executive's employment is terminated by
        the Company for Cause, or by the Executive for Good Reason, the date of receipt
        of the Notice of Termination or any later date specified therein, as the
        case
        may be, (ii) if the Executive's employment is terminated by the Company
        other than for Cause or Disability, the Date of Termination shall be the
        date on
        which the Company notifies the Executive of such termination, and (iii) if
        the Executive's employment is terminated by reason of death or Disability,
        the
        Date of Termination shall be the date of death of the Executive or the
        Disability Effective Date, as the case may be.

      

      
        
          
          

        

        
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      6.   Obligations
        of the Company upon Termination.

      

      (a)   Good
        Reason; Other Than for Cause, Death or Disability.
        If,
        during the Employment Period, the Company shall terminate the Executive's
        employment other than for Cause, death or Disability or the Executive shall
        terminate employment for Good Reason:

      

      (i)   The
        Company shall pay to the Executive in a lump sum in cash within 30 days
        after the Date of Termination the aggregate of the following
        amounts:

      

      [a]   The
        sum
        of [i] the Executive's Annual Base Salary through the Date of Termination
        to the extent not theretofore paid, [ii] the product of (x) the higher of
        [A] the Recent Annual Bonus and [B] the Annual Bonus paid or payable,
        including any bonus or portion thereof which has been earned but deferred
        (and
        annualized for any fiscal year consisting of less than 12 full months or
        during
        which the Executive was employed for less than 12 full months), for the most
        recently completed fiscal year during the Employment Period, if any (such
        higher
        amount being referred to as the "Highest Annual Bonus") and (y) a fraction,
        the
        numerator of which is the number of days in the current fiscal year through
        the
        Date of Termination, and the denominator of which is 365 and [iii] any
        compensation previously deferred by the Executive (together with any accrued
        interest or earnings thereon) and any accrued vacation pay, in each case
        to the
        extent not theretofore paid (the sum of the amounts described in
        clauses [i], [ii] and [iii] shall be hereinafter referred to as the
        "Accrued Obligations"); and

      

      [b]   The
        amount equal to the product of [i] three and [ii] the sum of (x) the
        Executive's Annual Base Salary and (y) the Highest Annual Bonus;
        and

      

      [c]   An
        amount
        equal to the difference between [i] the actuarial equivalent of the benefit
        (utilizing actuarial assumptions no less favorable to the Executive than
        those
        in effect under the Retirement Plan (as defined below) immediately prior
        to the
        Effective Date, except as specified below with respect to increases in base
        salary and annual bonus) under the qualified defined benefit retirement plan
        in
        which the Executive participates (the "Retirement Plan") and any excess or
        supplemental retirement plan in which the Executive participates (together,
        the
        "SERP") which the Executive would receive if the Executive's employment
        continued for three years after the Date of Termination assuming for this
        purpose that all accrued benefits are fully vested, and, assuming that
        (x) the Executive's base salary increased in each of the three years by the
        amount required by Section 4(b)(i) (in the case of Section 4-(b)(i)(y)
        based on increases (excluding promotional increases) in base salary for the
        most
        recently completed fiscal year prior to the Date of Termination) had the
        Executive remained employed, and (y) the Executive's annual bonus
        (annualized for any fiscal year consisting of less than twelve full months
        or
        during which the Executive was employed for less than twelve full months)
        in
        each of the three years bears the same proportion to the Executive's base
        salary
        in such year or fraction thereof as it did for the last full year prior to
        the
        Date of Termination, and [ii] the actuarial equivalent of the Executive's
        actual benefit (paid or payable), if any, under the Retirement Plan and the
        SERP
        as of the Date of Termination;

      

      
        
          
          

        

        
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      (ii)   For
        three
        years after the Executive's Date of Termination, or such longer period as
        may be
        provided by the terms of the appropriate plan, program, practice or policy,
        the
        Company shall continue benefits to the Executive and/or the Executive's family
        at least equal to those which would have been provided to them in accordance
        with the plans, programs, practices and policies described in
        Section 4(b)(iv) of this Agreement if the Executive's employment had not
        been terminated in accordance with the most favorable plans, practices, programs
        or policies of the Company and its affiliated companies applicable generally
        to
        other peer executives and their families during the 120-day period immediately
        preceding the Effective Date or, if more favorable to the Executive, as in
        effect generally at any time thereafter with respect to other peer executives
        of
        the Company and its affiliated companies and their families, provided, however,
        that if the Executive becomes reemployed with another employer and is eligible
        to receive medical or other welfare benefits under another employer provided
        plan, the medical and other welfare benefits described herein shall be secondary
        to those provided under such other plan during such applicable period of
        eligibility. For purposes of determining eligibility (but not the time of
        commencement of benefits) of the Executive for retiree benefits pursuant
        to such
        plans, practices, programs and policies, the Executive shall be considered
        to
        have remained employed until two and one-half years after the Date of
        Termination and to have retired on the last day of such period;

      

      (iii)   The
        Company shall, at its sole expense as incurred, provide the Executive with
        outplacement services the scope and provider of which shall be selected by
        the
        Executive in his sole discretion; and

      

      (iv)   To
        the
        extent not theretofore paid or provided, the Company shall timely pay or
        provide
        to the Executive any other amounts or benefits required to be paid or provided
        or which the Executive is eligible to receive under any plan, program, policy
        or
        practice or contract or agreement of the Company and its affiliated companies
        (such other amounts and benefits shall be hereinafter referred to as the
        "Other
        Benefits").

      

      (b)   Death.
        If the
        Executive's employment is terminated by reason of the Executive's death during
        the Employment Period, this Agreement shall terminate without further
        obligations to the Executive's legal representatives under this Agreement,
        other
        than for payment of Accrued Obligations and the timely payment or provision
        of
        Other Benefits. Accrued Obligations shall be paid to the Executive's estate
        or
        beneficiary, as applicable, in a lump sum in cash within 30 days of the
        Date of Termination. With respect to the provision of Other Benefits, the
        term
        Other Benefits as utilized in this Section 6(b) shall include, without
        limitation, and the Executives estate and/or beneficiaries shall be entitled
        to
        receive, benefits at least equal to the most favorable benefits provided
        by the
        Company and affiliated companies to the estates and beneficiaries of peer
        executives of the Company and such affiliated companies under such plans,
        programs, practices and policies relating to death benefits, if any, as in
        effect with respect to other peer executives and their beneficiaries at any
        time
        during the 120-day period immediately preceding the Effective Date or, if
        more
        favorable to the Executive's estate and/or the Executive's beneficiaries,
        as in
        effect on the date of the Executive's death with respect to other peer
        executives of the Company and its affiliated companies and their
        beneficiaries.

      

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      (c)   Disability.
        If the
        Executive's employment is terminated by reason of the Executive's Disability
        during the Employment Period, this Agreement shall terminate without further
        obligations to the Executive, other than for payment of Accrued Obligations
        and
        the timely payment or provision of Other Benefits. Accrued Obligations shall
        be
        paid to the Executive in a lump sum in cash within 30 days of the Date of
        Termination. With respect to the provision of Other Benefits, the term Other
        Benefits as utilized in this Section 6(c) shall include, and the Executive
        shall be entitled after the Disability Effective Date to receive, disability
        and
        other benefits at least equal to the most favorable of those generally provided
        by the Company and its affiliated companies to disabled executives and/or
        their
        families in accordance with such plans, programs, practices and policies
        relating to disability, if any, as in effect generally with respect to other
        peer executives and their families at any time during the 120-day period
        immediately preceding the Effective Date or, if more favorable to the Executive
        and/or the Executive's family, as in effect at any time thereafter generally
        with respect to other peer executives of the Company and its affiliated
        companies and their families.

      

      (d)   Cause;
        Other than for Good Reason.
        If the
        Executive's employment shall be terminated for Cause during the Employment
        Period, this Agreement shall terminate without further obligations to the
        Executive other than the obligation to pay to the Executive (i) his Annual
        Base Salary through the Date of Termination, (ii) the amount of any
        compensation previously deferred by the Executive, and (iii) Other
        Benefits, in each case to the extent theretofore unpaid. If the Executive
        voluntarily terminates employment during the Employment Period, excluding
        a
        termination for Good Reason, this Agreement shall terminate without further
        obligations to the Executive, other than for Accrued Obligations and the
        timely
        payment or provision of Other Benefits. In such case, all Accrued Obligations
        shall be paid to the Executive in a lump sum in cash within 30 days of the
        Date of Termination.

      

      7.   Nonexclusivity
        of Rights.
        Nothing
        in this Agreement shall prevent or limit the Executive's continuing or future
        participation in any plan, program, policy or practice provided by the Company
        or any of its affiliated companies and for which the Executive may qualify,
        nor
        shall anything herein limit or otherwise affect such rights as the Executive
        may
        have under any contract or agreement with the Company or any of its affiliated
        companies. Amounts which are vested benefits or which the Executive is otherwise
        entitled to receive under any plan, policy, practice or program of or any
        contract or agreement with the Company or any of its affiliated companies
        at or
        subsequent to the Date of Termination shall be payable in accordance with
        such
        plan, policy, practice or program or contract or agreement except as explicitly
        modified by this Agreement.

      

      
        
          
          

        

        
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      8.   Full
        Settlement.
        The
        Company's obligation to make the payments provided for in this Agreement
        and
        otherwise to perform its obligations hereunder shall not be affected by any
        set-off, counterclaim, recoupment, defense or other claim, right or action
        which
        the Company may have against the Executive or others. In no event shall the
        Executive be obligated to seek other employment or take any other action
        by way
        of mitigation of the amounts payable to the Executive under any of the
        provisions of this Agreement and such amounts shall not be reduced whether
        or
        not the Executive obtains other employment. The Company agrees to pay as
        incurred, to the full extent permitted by law, all legal fees and expenses
        which
        the Executive may reasonably incur as a result of any contest (regardless
        of the
        outcome thereof) by the Company, the Executive or others of the validity
        or
        enforceability of, or liability under, any provision of this Agreement or
        any
        guarantee of performance thereof (including as a result of any contest by
        the
        Executive about the amount of any payment pursuant to this Agreement), plus
        in
        each case interest on any delayed payment at the applicable Federal rate
        provided for in Section 7872(f)(2)(A) of the Internal Revenue Code of 1986,
        as amended (the "Code").

      

      9.   Certain
        Additional Payments by the Company.
        

      

      (a)   Anything
        in this Agreement to the contrary notwithstanding, in the event it shall
        be
        determined that any payment or distribution by the Company to or for the
        benefit
        of the Executive (whether paid or payable or distributed or distributable
        pursuant to the terms of this Agreement or otherwise, but determined without
        regard to any additional payments required under this Section 9) (a
        "Payment") would be subject to the excise tax imposed by Section 4999 of
        the Code or any interest or penalties are incurred by the Executive with
        respect
        to such excise tax (such excise tax, together with any such interest and
        penalties, are hereinafter collectively referred to as the "Excise Tax"),
        then
        the Executive shall be entitled to receive an additional payment (a "Gross-Up
        Payment") in an amount such that after payment by the Executive of all taxes
        (including any interest or penalties imposed with respect to such taxes),
        including, without limitation, any income taxes (and any interest and penalties
        imposed with respect thereto) and Excise Tax imposed upon the Gross-Up Payment,
        the Executive retains an amount of the Gross-Up Payment equal to the Excise
        Tax
        imposed upon the Payments.

      

      (b)   Subject
        to the provisions of Section 9(c), all determinations required to be made
        under this Section 9, including whether and when a Gross-Up Payment is
        required and the amount of such Gross-Up Payment and the assumptions to be
        utilized in arriving at such determination, shall be made by Arthur
        Andersen & Co. or such other certified public accounting firm as may be
        designated by the Executive (the "Accounting Firm") which shall provide detailed
        supporting calculations both to the Company and the Executive within
        15 business days of the receipt of notice from the Executive that there has
        been a Payment, or such earlier time as is requested by the Company. In the
        event that the Accounting Firm is serving as accountant or auditor for the
        individual, entity or group effecting the Change of Control, the Executive
        shall
        appoint another nationally recognized accounting firm to make the determinations
        required hereunder (which accounting firm shall then be referred to as the
        Accounting 

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

      Firm
        hereunder). All fees and expenses of the Accounting Firm shall be borne solely
        by the Company. Any Gross-Up Payment, as determined pursuant to this
        Section 9, shall be paid by the Company to the Executive within five days
        of the receipt of the Accounting Firm's determination. If the Accounting
        Firm
        determines that no Excise Tax is payable by the Executive, it shall furnish
        the
        Executive with a written opinion that failure to report the Excise Tax on
        the
        Executive's applicable federal income tax return would not result in the
        imposition of a negligence or similar penalty. Any determination by the
        Accounting Firm shall be binding upon the Company and the Executive. As a
        result
        of the uncertainty in the application of Section 4999 of the Code at the
        time of the initial determination by the Accounting Firm hereunder, it is
        possible that Gross-Up Payments which will not have been made by the Company
        should have been made ("Underpayment"), consistent with the calculations
        required to be made hereunder. In the event that the Company exhausts its
        remedies pursuant to Section 9(c) and the Executive thereafter is required
        to make a payment of any Excise Tax, the Accounting Firm shall determine
        the
        amount of the Underpayment that has occurred and any such Underpayment shall
        be
        promptly paid by the Company to or for the benefit of the
        Executive.

      

      (c)   The
        Executive shall notify the Company in writing of any claim by the Internal
        Revenue Service that, if successful, would require the payment by the Company
        of
        the Gross-Up Payment. Such notification shall be given as soon as practicable
        but no later than ten business days after the Executive is informed in writing
        of such claim and shall apprise the Company of the nature of such claim and
        the
        date on which such claim is requested to be paid. The Executive shall not
        pay
        such claim prior to the expiration of the 30-day period following the date
        on
        which it gives such notice to the Company (or such shorter period ending
        on the
        date that any payment of taxes with respect to such claim is due). If the
        Company notifies the Executive in writing prior to the expiration of such
        period
        that it desires to contest such claim, the Executive shall:

      

      (i)   Give
        the
        Company any information reasonably requested by the Company relating to such
        claim,

      

      (ii)   Take
        such
        action in connection with contesting such claim as the Company shall reasonably
        request in writing from time to time, including, without limitation, accepting
        legal representation with respect to such claim by an attorney reasonably
        selected by the Company,

      

      (iii)   Cooperate
        with the Company in good faith in order effectively to contest such claim,
        and

      

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

      (iv)   Permit
        the Company to participate in any proceedings relating to such claim; provided,
        however, that the Company shall bear and pay directly all costs and expenses
        (including additional interest and penalties) incurred in connection with
        such
        contest and shall indemnify and hold the Executive harmless, on an after-tax
        basis, for any Excise Tax or income tax (including interest and penalties
        with
        respect thereto) imposed as a result of such representation and payment of
        costs
        and expenses. Without limitation on the foregoing provisions of this
        Section 9(c), the Company shall control all proceedings taken in connection
        with such contest and, at its sole option, may pursue or forgo any and all
        administrative appeals, proceedings, hearings and conferences with the taxing
        authority in respect of such claim and may, at its sole option, either direct
        the Executive to pay the tax claimed and sue for a refund or contest the
        claim
        in any permissible manner, and the Executive agrees to prosecute such contest
        to
        a determination before any administrative tribunal, in a court of initial
        jurisdiction and in one or more appellate courts, as the Company shall
        determine; provided, however, that if the Company directs the Executive to
        pay
        such claim and sue for a refund, the Company shall advance the amount of
        such
        payment to the Executive, on an interest-free basis and shall indemnify and
        hold
        the Executive harmless, on an after-tax basis, from any Excise Tax or income
        tax
        (including interest or penalties with respect thereto) imposed with respect
        to
        such advance or with respect to any imputed income with respect to such advance;
        and further provided that any extension of the statute of limitations relating
        to payment of taxes for the taxable year of the Executive with respect to
        which
        such contested amount is claimed to be due is limited solely to such contested
        amount. Furthermore, the Company's control of the contest shall be limited
        to
        issues with respect to which a Gross-Up Payment would be payable hereunder
        and
        the Executive shall be entitled to settle or contest, as the case may be,
        any
        other issue raised by the Internal Revenue Service or any other taxing
        authority.

      

      (d)   If,
        after
        the receipt by the Executive of an amount advanced by the Company pursuant
        to
        Section 9(c), the Executive becomes entitled to receive any refund with
        respect to such claim, the Executive shall (subject to the Company's complying
        with the requirements of Section 9(c)) promptly pay to the Company the
        amount of such refund (together with any interest paid or credited thereon
        after
        taxes applicable thereto). If, after the receipt by the Executive of an amount
        advanced by the Company pursuant to Section 9(c), a determination is made
        that the Executive shall not be entitled to any refund with respect to such
        claim and the Company does not notify the Executive in writing of its intent
        to
        contest such denial of refund prior to the expiration of 30 days after such
        determination, then such advance shall be forgiven and shall not be required
        to
        be repaid and the amount of such advance shall offset, to the extent thereof,
        the amount of Gross-Up Payment required to be paid.

      

      

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

      10.   Confidential
        Information.
        The
        Executive shall hold in a fiduciary capacity for the benefit of the Company
        all
        secret or confidential information, knowledge or data relating to the Company
        or
        any of its affiliated companies, and their respective businesses, which shall
        have been obtained by the Executive during the Executive's employment by
        the
        Company or any of its affiliated companies and which shall not be or become
        public knowledge (other than by acts by the Executive or representatives
        of the
        Executive in violation of this Agreement). After termination of the Executive's
        employment with the Company, the Executive shall not, without the prior written
        consent of the Company or as may otherwise be required by law or legal process,
        communicate or divulge any such information, knowledge or data to anyone
        other
        than the Company and those designated by it. In no event shall an asserted
        violation of the provisions of this Section 10 constitute a basis for
        deferring or withholding any amounts otherwise payable to the Executive under
        this Agreement.

      

      11.   Successors.
        

      

      (a)   This
        Agreement is personal to the Executive and without the prior written consent
        of
        the Company shall not be assignable by the Executive otherwise than by will
        or
        the laws of descent and distribution. This Agreement shall inure to the benefit
        of and be enforceable by the Executive's legal representatives.

      

      (b)   This
        Agreement shall inure to the benefit of and be binding upon the Company and
        its
        successors and assigns.

      

      (c)   The
        Company will require any successor (whether direct or indirect, by purchase,
        merger, consolidation or otherwise) to all or substantially all of the business
        and/or assets of the Company to assume expressly and agree to perform this
        Agreement in the same manner and to the same extent that the Company would
        be
        required to perform it if no such succession had taken place. As used in
        this
        Agreement, "Company" shall mean the Company as hereinbefore defined and any
        successor to its business and/or assets as aforesaid which assumes and agrees
        to
        perform this Agreement by operation of law, or otherwise.

      

      12.   Miscellaneous.
        

      

      (a)   This
        Agreement shall be governed by and construed in accordance with the laws
        of the
        State of Wisconsin, without reference to principles of conflict of laws.
        The
        captions of this Agreement are not part of the provisions hereof and shall
        have
        no force or effect. This Agreement may not be amended or modified otherwise
        than
        by a written agreement executed by the parties hereto or their respective
        successors and legal representatives.

      

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

      

      (b)   All
        notices and other communications hereunder shall be in writing and shall
        be
        given by hand delivery to the other party or by registered or certified mail,
        return receipt requested, postage prepaid, addressed as follows: 

      

      If
        to the
        Executive, to his address appearing on the records of the Company.

      

      If
        to the
        Company:

      

      STRATTEC
        SECURITY CORPORATION 

      3333
        West
        Good Hope Road

      Milwaukee,
        WI 53209

      Attn:
        Chairman and Chief Executive Officer

      

      

      or
        to
        such other address as either party shall have furnished to the other in writing
        in accordance herewith. Notice and communications shall be effective when
        actually received by the addressee.

      

      (c)   The
        invalidity or unenforceability of any provision of this Agreement shall not
        affect the validity or enforceability of any other provision of this
        Agreement.

      

      (d)   The
        Company may withhold from any amounts pay-able under this Agreement such
        Federal, state, local or foreign taxes as shall be required to be withheld
        pursuant to any applicable law or regulation.

      

      (e)   The
        Executive's or the Company's failure to insist upon strict compliance with
        any
        provision hereof or any other provision of this Agreement or the failure
        to
        assert any right the Executive or the Company may have hereunder, including,
        without limitation, the right of the Executive to terminate employment for
        Good
        Reason pursuant to Section 5(c)(i)-(v) of this Agreement, shall not be
        deemed to be a waiver of such provision or right or any other provision or
        right
        of this Agreement.

      

      (f)   The
        Executive and the Company acknowledge that, except as may otherwise be provided
        under any other written agreement between the Executive and the Company,
        the
        employment of the Executive by the Company is "at will" and, prior to the
        Effective Date, the Executive's employment and this Agreement may be terminated
        by either the Executive or the Company at any time prior to the Effective
        Date,
        in which case the Executive shall have no further rights under this Agreement.
        From and after the Effective Date this Agreement shall supersede any other
        agreement between the parties with respect to the subject matter
        hereof.

      

      
        
          
          

        

        
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      IN
        WITNESS WHEREOF, the Executive has hereunto set the Executive's hand and,
        pursuant to the authorization from its Board of Directors, the Company has
        caused these presents to be executed in its name on its behalf, all as of
        the
        day and year first above written.

       

      

          /s/ 
        Brian J.
        Reetz                                                 

              Brian
        J. Reetz

      

          STRATTEC
        SECURITY CORPORATION

      

          BY 
        /s/ Harold M. Stratton
        II                                 

            Harold
        M. Stratton, II, 

           
        Chairman of the Board 

            and
        Chief Executive Officer

      

       

       

       

      

        17Exhibit 10.1

    

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      

      UNOVA,
        INC.

      

      

      2004
        OMNIBUS INCENTIVE COMPENSATION PLAN

      

      

      Approved
        May 6, 2004

      

      Amended
        and Restated as of March 30, 2007

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      UNOVA,
        INC.

      2004
        OMNIBUS INCENTIVE COMPENSATION PLAN

      

      TABLE
        OF CONTENTS

       

      Page

      

      Section
        1. Purposes;
        Definitions 

      Section
        2. Administration 

      Section
        3. Share
        Authorization 

      Section
        4. Eligibility 

      Section
        5. Stock
        Options 

      Section
        6. Stock
        Appreciation Rights 

      Section
        7. Restricted
        Stock and Restricted Stock Units 

      Section
        8. Performance
        Units/Performance Shares 

      Section
        9. Cash-Based
        and Other Stock-Based Awards 

      Section
        10. Performance
        Measures 

      Section
        11. Covered
        Employee Annual Incentive Awards 

      Section
        12. Term,
        Amendment and Termination 

      Section
        13. Change
        of
        Control Provisions 

      Section
        14. Unfunded
        Status of Plan 

      Section
        15. Uncertificated
        Shares 

      Section
        16. Withholding 

      Section
        17. General
        Provisions 

      Section
        18. Effective
        Date of Plan 

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      SECTION
        1. Purpose;
        Definitions

       

      The
        purpose of the Plan is to give the Company a competitive advantage in
        attracting, retaining and motivating officers and other employees and to
        provide
        the Company and its Subsidiaries with a stock plan providing incentives directly
        linked to the profitability of the Company's businesses and increases in
        shareholder value.

      

      For
        purposes of the Plan, the following terms are defined as set forth
        below:

      

      “Affiliate”
        shall
        have the meaning ascribed to such term in Rule 12b-2 of the General Rules
        and
        Regulations of the Exchange Act.

      

      “Award”
        means,
        individually or collectively, a grant under this Plan of Stock Appreciation
        Rights, Stock Options, Restricted Stock, Restricted Stock Units, Performance
        Shares, Performance Units, Covered Employee Annual Incentive Awards, Cash-Based
        Awards and Other Stock-Based Awards.

      

      “Award
        Agreement”
        means
        either (i) a written agreement entered into by the Company and an Eligible
        Individual setting forth the terms and provisions applicable to an Award
        granted
        under this Plan, or (ii) a written statement issued by the Company to an
        Eligible Individual describing the terms and provisions of such
        Award.

      

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

      

      “Cash-Based
        Award”
        means an
        Award granted to an Eligible Individual as
        described in Section 9.

      

      “Change
        of Control”
        has the
        meaning set forth in Section 13(b).

      

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

      

      “Commission”
        means
        the Securities and Exchange Commission, or any successor agency.

      

      “Committee”
        means
        the Committee referred to in Section 2.

      

      “Company”
        means
        UNOVA, Inc., a Delaware corporation.

      

      “Covered
        Employee”
        means an
        Eligible Individual who is a “covered employee,” as defined in Code Section
        162(m) and the regulations promulgated under Code Section 162(m), or any
        successor statute.

      

      “Covered
        Employee Annual Incentive Award” means
        an
        Award granted to a Covered Employee as described in Section 10.

      

      “Disability”
        means
        permanent and total disability as determined for purposes of the Company’s Long
        Term Disability Plan for the staff of the Company’s corporate
        headquarters.

      

      “Early
        Retirement”
        means
        retirement from employment with the Company, a Subsidiary, or Affiliate in
        circumstances in which the employee would be entitled to receive retirement
        benefits under the pension plan of the Company, a Subsidiary, or an Affiliate
        under which such employee is covered.

      

      “Eligible
        Individuals”
        means
        officers or other employees of the Company or any of its Subsidiaries and
        Affiliates and prospective employees who have accepted offers of employment
        from
        the Company, a Subsidiary, or an Affiliate who are or will be responsible
        for or
        contribute to the management, growth or profitability of the business of
        the
        Company, its Subsidiaries, or Affiliates.

      

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

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      “Fair
        Market Value”
        or “FMV”
        means ,
        as of any given date, the average of the highest and lowest per share sales
        prices reported for a Share during normal business hours on the New York
        Stock
        Exchange (“NYSE”) for such date, , if traded thereon, or, if not traded thereon,
        on a national securities exchange, if traded thereon, or, if not traded thereon,
        the average of the high and low or closing bid and asked prices reported
        on
        another reporting system that provides such information on the applicable
        date,
        the preceding trading day, the next succeeding trading day, or an average
        of
        trading days, as determined by the Committee in its discretion. In the event
        Shares are not publicly traded at the time a determination of their value
        is
        required to be made hereunder, the determination of their Fair Market Value
        shall be made by the Committee in such manner as it deems appropriate. Such
        definition(s) of FMV shall be specified in each Award Agreement and may differ
        depending on whether FMV is in reference to the grant, exercise, vesting,
        settlement, or payout of an Award.

      

      “Freestanding
        SAR”
        means a
        SAR that is granted independently of any Stock Options, as described in Section
        6.

      

      “Incentive
        Stock Option”
        or
“ISO”
        means an
        Option to purchase Shares granted under Section 5 to an Eligible Individual
        and
        that is designated as an Incentive Stock Option and that is intended to meet
        the
        requirements of Code Section 422, or any successor provision.

      

      “Non-Qualified
        Stock Option”
        or
“NQSO”
        means
        an Option that is not intended to meet the requirements of Code
        Section 422, or that otherwise does not meet such
        requirements.

      

      “Normal
        Retirement”
        means
        retirement from active employment with the Company or a Subsidiary or an
        Affiliate as provided for in such entity’s retirement or pension plan, as
        applicable.

      

      “Other
        Stock-Based Award” means
        an
        equity-based or equity-related Award not otherwise described by the terms
        of
        this Plan, granted pursuant to Section 9.

      

      “Performance
        Measures” means
        measures as described in Section 10 on which Qualified Performance-Based
        Awards
        are based and which are approved by the Company’s shareholders pursuant to this
        Plan in order to qualify as Qualified Performance-Based Awards.

      

      “Performance
        Period” means
        the
        period of time during which the Performance Measures must be met in order
        to
        determine the degree of payout and/or vesting with respect to an
        Award.

      

      “Performance
        Share” means
        an
        Award granted to an Eligible Individual, as described in Section 8.

      

      “Performance
        Unit” means
        an
        Award granted to an Eligible Individual, as described in Section 8.

      

      “Period
        of Restriction”
        means
        the period when Restricted Stock or Restricted Stock Units are subject to
        a
        substantial risk of forfeiture (based on the passage of time, the achievement
        of
        Performance Measures, or upon the occurrence of other events as determined
        by
        the Committee, in its discretion), as provided in Section 7.

      

      “Plan”
        means
        the UNOVA, Inc. 2004 Omnibus Incentive Compensation Plan, as set forth herein
        and as hereinafter amended from time to time.

      

      “Plan
        Year”
        means
        the Company’s fiscal year, which begins January 1 and ends December
        31.

      

      “Qualified
        Performance-Based Award”
        means an
        Award designated as such by the Committee at the time of grant, based upon
        a
        determination that (i) the recipient is or may be a "covered employee"
        within the meaning of Section 162(m)(3) of the Code in the year in which
        the
        Company would expect to be able to claim a tax deduction with respect to
        such
        Award and (ii) the Committee wishes such Award to qualify for the Section
        162(m) Exemption.

      

      “Restricted
        Stock” means
        an
        Award granted under Section 7.

      

      “Restricted
        Stock Unit”
        or
“RSU” means
        an
        Award granted pursuant to Section 7, except no Shares are actually awarded
        on
        the date of grant.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      “Retirement”
        means
        Normal or Early Retirement.

      

      “Rule
        16b-3”
        means
        Rule 16b-3 as promulgated by the Commission under Section 16(b) of the Exchange
        Act, as amended from time to time.

      

      “Section
        162(m) Exemption”
        means
        the exemption from the limitation on deductibility imposed by Section 162(m)
        of
        the Code that is set forth in Section 162(m)(4)(C) of the Code.

      

      “Share”
        means a
        share of common stock, par value $.01 per share, of the Company.

      

      “Stock
        Appreciation Right”
        means an
        Award granted under Section 6.

      

      “Stock
        Option”
        means an
        Award granted under Section 5.

      

      “Subsidiary” means
        any
        corporation or other entity, whether domestic or foreign, in which the Company
        has or obtains, directly or indirectly, a proprietary interest of more than
        fifty percent (50%) by reason of stock ownership or otherwise.

      

      “Tandem
        SAR”
        means a
        SAR that is granted in connection with a related Stock Option pursuant to
        Section 6 herein, the exercise of which shall require forfeiture of the right
        to
        purchase a Share under the related Stock Option (and when a Share is purchased
        under the Stock Option, the Tandem SAR shall similarly be
        canceled).

      

      “Termination
        of Employment”
        means
        the termination of the Eligible Individual's employment with the Company
        and any
        of its Subsidiaries or Affiliates. An Eligible Individual employed by a
        Subsidiary or Affiliate shall also be deemed to incur a Termination of
        Employment if the Subsidiary or Affiliate ceases to be such a Subsidiary
        or
        Affiliate, and the Eligible Individual does not immediately thereafter become
        an
        employee of the Company or another Subsidiary or Affiliate. Temporary absences
        from employment because of illness, vacation or leave of absence and transfers
        among the Company and its Subsidiaries or Affiliates shall not be considered
        Terminations of Employment. If so determined by the Committee, an Eligible
        Individual shall be deemed not to have incurred a Termination of Employment
        if
        the Eligible Individual enters into a contract with the Company, a Subsidiary,
        or an Affiliate providing for the rendering by the Eligible Individual of
        consulting services to the Company or such Subsidiary or Affiliate on terms
        approved by the Committee; however, Termination of Employment of the Eligible
        Individual shall occur when such contract ceases to be in effect.

      

      In
        addition, certain other terms used herein have definitions given to them
        in the
        first place in which they are used.

      

      SECTION
        2. Administration

       

      The
        Plan
        shall be administered by the Compensation, Governance and Nominating Committee
        or such other committee of the Board as the Board may from time to time
        designate (the “Committee”), which shall be composed of not less than two
        independent directors, and shall be appointed by and serve at the pleasure
        of
        the Board.

      

      The
        Committee shall have plenary authority to grant Awards pursuant to the terms of
        the Plan to Eligible Individuals.

      

      Among
        other things, the Committee shall have the authority, subject to its power
        to
        delegate its authority as described below and subject to the other terms
        of the
        Plan:

      

      
        	
                (a)

              	
                To
                  select the Eligible Individuals to whom Awards may from time to
                  time be
                  granted;

              

      

      

      
        	
                (b)

              	
                To
                  determine the number of Shares or other amount to be covered by
                  each Award
                  granted hereunder;

              

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	
                (c)

              	
                To
                  determine the terms and conditions of any Award granted hereunder,
                  any
                  vesting condition, restriction or limitation (which may be related
                  to the
                  performance of the Eligible Individual, the Company, any Subsidiary,
                  or
                  Affiliate, or any business unit of the Company, Subsidiary or Affiliate)
                  and any vesting acceleration or forfeiture waiver regarding any
                  Award and
                  the Shares relating thereto, based on such factors as the Committee
                  shall
                  determine;

              

      

      

      
        	
                (d)

              	
                To
                  modify, amend or adjust the terms and conditions of any Award,
                  at any time
                  or from time to time, including but not limited to Performance
                  Measures;
                  provided,
                  however,
                  that the Committee may not increase the amount payable with respect
                  to a
                  Qualified Performance-Based Award or waive or alter the Performance
                  Measures associated therewith or cause such Qualified Performance-Based
                  Award to vest earlier than
                  permitted;

              

      

      

      
        	
                (e)

              	
                To
                  determine to what extent and under what circumstances Shares and
                  other
                  amounts payable with respect to an Award shall be deferred;
                  and

              

      

      

      
        	
                (f)

              	
                To
                  determine under what circumstances an Award may be settled in cash
                  or
                  Shares.

              

      

      

      The
        Committee shall have the authority to adopt, alter and repeal such
        administrative rules, guidelines and practices governing the Plan as it shall
        from time to time deem advisable, to interpret the terms and provisions of
        the
        Plan and any Award issued under the Plan (and any Award Agreement relating
        thereto) and to otherwise supervise the administration of the Plan.

      

      The
        Committee may act only by a majority of its members then in office, except
        that
        the Committee may, except to the extent prohibited by applicable law or
        regulation or the applicable rules of a stock exchange, allocate all or any
        portion of its responsibilities and powers to any one or more of its members
        and
        may delegate all or any part of its responsibilities and powers to any person
        or
        persons selected by it; provided,
        however,
        that no
        such delegation may be made that would cause any Award or transaction to
        become
        subject to (or lose an exemption under) the short-swing profit recovery
        provisions of Section 16(b) of the Exchange Act or cause an Award designated
        as
        a Qualified Performance-Based Award not to qualify for, or to cease to qualify
        for, the Section 162(m) Exemption. Any such allocation or delegation may
        be
        revoked by the Committee at any time.

      

      Any
        determination made by the Committee or pursuant to delegated authority pursuant
        to the provisions of the Plan with respect to any Award shall be made in
        the
        sole discretion of the Committee or such delegate at the time of the grant
        of
        the Award or, unless in contravention of any express term of the Plan, at
        any
        time thereafter. All decisions made by the Committee or any appropriately
        delegated officer pursuant to the provisions of the Plan shall be final and
        binding on all persons, including the Company and Eligible
        Individuals.

      

      Any
        authority granted to the Committee may also be exercised by the full Board,
        except to the extent that the grant or exercise of such authority would cause
        any Award or transaction to become subject to (or lose an exemption under)
        the
        short-swing profit recovery provisions of Section 16(b) of the Exchange Act
        or
        cause an Award designated as a Qualified Performance-Based Award not to qualify
        for, or to cease to qualify for, the Section 162(m) Exemption. To the extent
        that any permitted action taken by the Board conflicts with action taken
        by the
        Committee, the Board action shall control.

      

      SECTION
        3. Share
        Authorization

       

      
        	
                (a)

              	
                Shares
                  Subject to the Plan. The
                  maximum number of Shares that may be issued to Eligible Individuals
                  and
                  their beneficiaries under the Plan shall be three million (3,000,000)
                  Shares. Shares issued under the Plan may be authorized and unissued
                  Shares
                  or may be treasury Shares.

              

      

      

      
        	
                (b)

              	
                Incentive
                  Stock Option Limit.
                  Subject to the limit set forth in Section 3(a) on the number of
                  Shares
                  that may be issued in the aggregate under the Plan, the maximum
                  number of
                  Shares that may be issued pursuant to ISOs shall be two million
                  (2,000,000).

              

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      

      
        	
                (c)

              	
                Share
                  Usage. Shares
                  covered by an Award shall only be counted as used to the extent
                  they are
                  actually issued. Any Shares related to Awards which terminate by
                  expiration, forfeiture, cancellation, or otherwise without the
                  issuance of
                  such Shares, are settled in cash in lieu of Shares, or are exchanged
                  with
                  the Committee’s permission, prior to the issuance of Shares, for Awards
                  not involving Shares, shall be available again for grant under
                  the Plan.
                  Moreover, if the option price of any Stock Option granted under
                  the Plan
                  or the tax withholding requirements with respect to any Award granted
                  under the Plan are satisfied by tendering Shares to the Company
                  (by either
                  actual delivery or by attestation), or if a SAR is exercised, only
                  the
                  number of Shares issued, net of the Shares tendered, if any, will
                  be
                  deemed delivered for purposes of determining the maximum number
                  of Shares
                  available for delivery under the Plan. The maximum number of Shares
                  available for issuance under the Plan shall not be reduced to reflect
                  any
                  dividends or dividend equivalents that are reinvested into additional
                  Shares or credited as additional Restricted Stock, Restricted Stock
                  Units,
                  Performance Shares, or Stock-Based
                  Awards.

              

      

      

      
        	
                (d)

              	
                Annual
                  Award Limits.
                  Unless and until the Committee determines that an Award to a Covered
                  Employee shall not be designed to qualify as Qualified Performance-Based
                  Award, the following limits (each an “Annual Award Limit,” and,
                  collectively, “Annual Award Limits”) shall apply to grants of such Awards
                  under the Plan: 

              

      

      

      (i) Options:
        The
        maximum aggregate number of Shares subject to Options granted in any one
        Plan
        Year to any one Eligible Individual shall be seven hundred fifty thousand
        (750,000).

      

      (ii) SARs:
        The
        maximum number of Shares subject to Stock Appreciation Rights granted in
        any one
        Plan Year to any one Eligible Individual shall be seven hundred fifty thousand
        (750,000).

      

      (iii) Restricted
        Stock or Restricted Stock Units:
        The
        maximum aggregate grant with respect to Awards of Restricted Stock or Restricted
        Stock Units in any one Plan Year to any one Eligible Individual shall be
        two
        hundred fifty thousand (250,000).

      

      (iv) Performance
        Units or Performance Shares:
        The
        maximum aggregate Award of Performance Units or Performance Shares that an
        Eligible Individual may receive in any one Plan Year shall be two hundred
        fifty
        thousand (250,000) Shares, or equal to the value of two hundred fifty thousand
        (250,000) Shares determined as of the date of vesting or payout, as applicable.
        

      

      (v) Cash-Based
        Awards:
        The
        maximum aggregate amount awarded or credited with respect to Cash-Based Awards
        to any one Participant in any one Plan Year may not exceed the greater of
        one
        hundred thousand (100,000)
        Shares or the value of one hundred thousand (100,000) Shares
        determined as of the date of vesting or payout, as applicable.

      

      (vi) Other
        Stock-Based Awards:
        The
        maximum aggregate grant with respect to Other Stock-Based Awards pursuant
        to
        Section 9 in any one Plan Year to any one Eligible Individual shall be one
        hundred thousand (100,000) Shares.

      

      (vii) Covered
        Employee Annual Incentive Awards:
        The
        maximum aggregate amount awarded or credited in any one Plan Year with respect
        to a Covered Employee Annual Incentive Award shall be determined in accordance
        with Section 11.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	
                (e)

              	
                Adjustments
                  in Authorized Shares.
                  In
                  the event of any corporate event or transaction (including, but
                  not
                  limited to, a change in the stock of the Company or the capitalization
                  of
                  the Company) such as a merger, consolidation, reorganization,
                  recapitalization, separation, stock dividend, stock split, reverse
                  stock
                  split, split up, spin-off, or other distribution of stock or property
                  of
                  the Company, combination of Shares, exchange of Shares, dividend
                  in kind,
                  or other like change in capital structure or distribution (other
                  than
                  normal cash dividends) to shareholders of the Company, or any similar
                  corporate event or transaction, the Committee, in its sole discretion,
                  in
                  order to prevent dilution or enlargement of Eligible Individuals’ rights
                  under the Plan, shall substitute or adjust, as applicable, the
                  number and
                  kind of Shares that may be issued under the Plan or under particular
                  forms
                  of Awards, the number and kind of Shares subject to outstanding
                  Awards,
                  the option price or grant price applicable to outstanding Awards,
                  the
                  Annual Award Limits, and other value determinations applicable
                  to
                  outstanding Awards.

              

      

      

      The
        Committee, in its sole discretion, may also make appropriate adjustments
        in the
        terms of Awards under the Plan to reflect or related to such changes or
        distributions and to modify any other terms of outstanding Awards, including
        modifications of Performance Measures and changes in the length of Performance
        Periods. The determination of the Committee as to the foregoing adjustments,
        if
        any, shall be conclusive and binding on Eligible Individuals under the Plan.
        

      

      SECTION
        4. Eligibility

       

      Awards
        may be granted under the Plan to Eligible Individuals. No grant shall be
        made
        under this Plan to a director who is not an officer or a salaried employee
        of
        the Company or its Subsidiaries and Affiliates. Subject to the provisions
        of the
        Plan, the Committee may, from time to time, select from all Eligible
        Individuals, those to whom Awards shall be granted and shall determine, in
        its
        sole discretion, the nature of, any and all terms permissible by law, and
        the
        amount of each Award.

      

       

      SECTION
        5. Stock
        Options

       

      
        	
                (a)

              	
                Grant
                  of Stock Options.
                  Subject to the terms and provisions of the Plan, Stock Options
                  may be
                  granted to Eligible Individuals in such number, and upon such terms,
                  and
                  at any time and from time to time as shall be determined by the
                  Committee,
                  in its sole discretion; provided,
                  however,
                  that ISOs may be granted only to eligible employees of the Company
                  or of
                  any corporate Subsidiary or Affiliate (as permitted by Section
                  422 of the
                  Code and the regulations
                  thereunder).

              

      

      

      
        	
                (b)

              	
                Award
                  Agreement.
                  Each Stock Option grant shall be evidenced by an Award Agreement
                  that
                  shall specify the option price, the maximum term of the Stock Option,
                  the
                  number of Shares to which the Option pertains, the conditions upon
                  which
                  an Option shall become vested and exercisable, and such other provisions
                  as the Committee shall determine which are not inconsistent with
                  the terms
                  of the Plan. The Award Agreement also shall specify whether the
                  Stock
                  Option is intended to be an ISO or a
                  NQSO.

              

      

      

      
        	
                (c)

              	
                Option
                  Price.
                  The option price for each grant of a Stock Option under this Plan
                  shall be
                  as determined by the Committee and shall be specified in the Award
                  Agreement. The option price shall be based on not less than one
                  hundred
                  percent (100%) of the FMV of the Shares on the date of
                  grant.

              

      

      

      
        	
                (d)

              	
                Term.
                  Each Stock Option shall expire at such time as the Committee shall
                  determine at the time of grant; provided,
                  however,
                  that no Stock Option shall be exercisable later than the tenth
                  (10th)
                  anniversary date of its grant. Notwithstanding the foregoing, for
                  Stock
                  Options granted to Eligible Individuals that are employed by the
                  Company,
                  a Subsidiary or an Affiliate outside the United States, the Committee
                  has
                  the authority to grant Stock Options that have a term greater than
                  ten
                  (10) years. 

              

      

      

      
        	
                (e)

              	
                Exercise
                  of Stock Options.
                  Stock Options granted under this Section 5 shall be exercisable
                  at such
                  times and be subject to such restrictions and conditions as the
                  Committee
                  shall in each instance approve, which terms and restrictions need
                  not be
                  the same for each grant or for each Eligible
                  Individual.

              

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	
                (f)

              	
                Payment.
                  Stock Options granted under this Section 5 shall be exercised by
                  the
                  delivery of a notice of exercise to the Company or an agent designated
                  by
                  the Company in a form specified or accepted by the Committee, or
                  by
                  complying with any alternative procedures which may be authorized
                  by the
                  Committee, setting forth the number of Shares with respect to which
                  the
                  Option is to be exercised, accompanied by full payment for the
                  Shares.

              

      

      

      
        	
                (g)

              	
                Restrictions
                  on Share Transferability.
                  The Committee may impose such restrictions on any Shares acquired
                  pursuant
                  to the exercise of a Stock
                  Option granted
                  under this Section 5 as it may deem advisable, including, without
                  limitation, minimum holding period requirements, restrictions under
                  applicable federal securities laws, under the requirements of any
                  stock
                  exchange or market upon which such Shares are then listed
                  and/or traded, or under any blue sky or state securities laws
                  applicable to such Shares.

              

      

      

      
        	
                (h)

              	
                Termination
                  of Employment. Each
                  Eligible
                  Individual’s
                  Award Agreement shall set forth the extent to which the Eligible
                  Individual
                  or
                  his or her personal representative shall have the right to exercise
                  the
                  Stock
                  Option following
                  termination of the Eligible
                  Individual’s
                  employment or provision of services to the Company, its Affiliates,
                  its
                  Subsidiaries, as the case may be. Such provisions shall be determined
                  in
                  the sole discretion of the Committee, shall be included in the
                  Award
                  Agreement entered into with each Eligible
                  Individual,
                  need not be uniform among all Stock
                  Options issued
                  pursuant to this Section 5, and may reflect distinctions based
                  on the
                  reasons for termination.

              

      

      

      
        	
                (i)

              	
                Transferability
                  of Options. 

              

      

      

      
        	(a)	
                Incentive
                  Stock Options.
                  No ISO granted under the Plan may be sold, transferred, pledged,
                  assigned,
                  or otherwise alienated or hypothecated, other than by will or by
                  the laws
                  of descent and distribution. Further, all ISOs granted to an Eligible
                  Individual
                  under this Section 5 shall be exercisable during his or her lifetime
                  only
                  by such Eligible
                  Individual.

              

      

      

      
        	(b)	
                Nonqualified
                  Stock Options.
                  Except as otherwise provided in an Eligible Individual’s Award Agreement
                  or otherwise determined at any time by the Committee, no NQSO granted
                  under this Section 5 may be sold, transferred, pledged, assigned,
                  or
                  otherwise alienated or hypothecated, other than by will or by the
                  laws of
                  descent and distribution; provided,
                  however,
                  that the Board or Committee may permit further transferability,
                  on a
                  general or a specific basis, and may impose conditions and limitations
                  on
                  any permitted transferability. Further, except as otherwise provided
                  in an
                  Eligible Individual’s Award Agreement or otherwise determined at any time
                  by the Committee, or unless the Board or Committee decides to permit
                  further transferability, all NQSOs granted to an Eligible Individual
                  under
                  this Section 5 shall be exercisable during his or her lifetime
                  only by
                  such Eligible Individual. With respect to those NQSOs, if any,
                  that are
                  permitted to be transferred to another person, references in the
                  Plan to
                  exercise or payment of the Option Price by the Eligible Individual
                  shall
                  be deemed to include, as determined by the Committee, the Eligible
                  Individual’s permitted transferee.

              

      

      

      
        	
                (j)

              	
                Notification
                  of Disqualifying Disposition.
                  If any Eligible Individual shall make any disposition of Shares
                  issued
                  pursuant to the exercise of an ISO under the circumstances described
                  in
                  Section 421(b) of the Code (relating to certain disqualifying
                  dispositions), such Eligible Individual shall notify the Company
                  of such
                  disposition within ten (10) days
                  thereof.

              

      

      

      
        	
                (k)

              	
                Substituting
                  SARs.
                  Only in the event the Company is not accounting for equity compensation
                  under APB Opinion No. 25, the Committee may substitute, without
                  receiving
                  Eligible
                  Individual
                  permission, SARs paid only in Stock for outstanding Stock Options;
                  provided,
                  however,
                  that the terms of such SARs are the same as the terms for the Stock
                  Options and
                  the aggregate difference between the Fair Market Value of the underlying
                  Shares and the grant price of the SARs is equivalent to the aggregate
                  difference between the Fair Market Value of the underlying Shares
                  and the
                  Option Price of the Stock
                  Options.

              

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      

      SECTION
        6. Stock
        Appreciation Rights

       

      
        	
                (a)

              	
                Grant
                  of SARS. Subject
                  to the terms and conditions of the Plan, SARS may be granted to
                  Eligible
                  Individuals at any time and from time to time as shall be determined
                  by
                  the Committee. The Committee may grant Freestanding SARS, Tandem
                  SARs, or
                  any combination of these forms of
                  SARs.

              

      

      

      
        	 	
                Subject
                  to the terms and conditions of the Plan, the Committee shall have
                  complete
                  discretion in determining the number of SARs granted to each Eligible
                  Individual and, consistent with the provisions of the Plan, in
                  determining
                  the terms and conditions pertaining to such
                  SARs.

              

      

      

      
        	 	
                The
                  grant price for each grant of a Freestanding SAR shall be determined
                  by
                  the Committee and shall be specified in the Award Agreement. The
                  grant
                  price may include (but not be limited to) a grant price based on
                  one
                  hundred percent (100%) of the FMV of the Shares on the date of
                  grant, a
                  grant price that is set at a premium to the FMV of the Shares on
                  the date
                  of grant, or is indexed to the FMV of the Shares on the date of
                  grant,
                  with the index determined by the Committee, in its discretion.
                  The grant
                  price of Tandem SARs shall be equal to the option price of the
                  related
                  Stock Option. 

              

      

      

      
        	
                (b)

              	
                Award
                  Agreement. Each
                  SAR Award shall be evidenced by an Award Agreement that shall specify
                  the
                  grant price, the term of the SAR, and such other provisions as
                  the
                  Committee shall determine.

              

      

      

      
        	
                (c)

              	
                Term
                  of SAR. The
                  term of a SAR granted under the Plan shall be determined by the
                  Committee,
                  in its sole discretion, and except as determined otherwise by the
                  Committee and specified in the Award Agreement, no SAR shall be
                  exercisable later than the tenth (10th) anniversary date of its
                  grant.
                  Notwithstanding the foregoing, for SARs granted to Eligible Individuals
                  outside the United States, the Committee has the authority to grant
                  SARs
                  that have a term greater than ten (10)
                  years.

              

      

      

      
        	
                (d)

              	
                Exercise
                  of Freestanding SARs.
                  Freestanding SARs may be exercised upon whatever terms and conditions
                  the
                  Committee, in its sole discretion,
                  imposes.

              

      

      

      
        	
                (e)

              	
                Exercise
                  of Tandem SARs.
                  Tandem SARs may be exercised for all or part of the Shares subject
                  to the
                  related Stock Option upon the surrender of the right to exercise
                  the
                  equivalent portion of the related Stock Option. A Tandem SAR may
                  be
                  exercised only with respect to the Shares for which its related
                  Stock
                  Option is then exercisable.

              

      

      

      
        	 	
                Notwithstanding
                  any other provision of this Plan to the contrary, with respect
                  to a Tandem
                  SAR granted in connection with an ISO (i) the Tandem SAR will expire
                  no
                  later than the expiration of the underlying ISO; (ii) the value
                  of the
                  payout with respect to the Tandem SAR may be for no more than one
                  hundred
                  percent (100%) of the excess of the Fair Market Value of the Shares
                  subject to the underlying ISO at the time the Tandem SAR is exercised
                  over
                  the option price of the underlying ISO; and (iii) the Tandem SAR
                  may be
                  exercised only when the Fair Market Value of the Shares subject
                  to the ISO
                  exceeds the option price of the
                  ISO.

              

      

      

      
        	
                (f)

              	
                Payment
                  of SAR Amount. Upon
                  the exercise of a SAR, an Eligible Individual shall be entitled
                  to receive
                  payment from the Company in an amount determined by
                  multiplying:

              

      

      

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

              

      

      

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

              

      

      

      
        	 	
                At
                  the discretion of the Committee, the payment upon SAR exercise
                  may be in
                  cash, Shares, or any combination thereof, or in any other manner
                  approved
                  by the Committee in its sole discretion. The Committee’s determination
                  regarding the form of SAR payout shall be set forth in the Award
                  Agreement
                  pertaining to the grant of the
                  SAR.

              

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	
                (g)

              	
                Termination
                  of Employment.
                  Each Award Agreement shall set forth the extent to which the Eligible
                  Individual shall have the right to exercise the SAR following termination
                  of the Eligible Individual’s employment with or provision of services to
                  the Company, its Affiliates, and/or its Subsidiaries, as the case
                  may be.
                  Such provisions shall be determined in the sole discretion of the
                  Committee, shall be included in the Award Agreement entered into
                  with
                  Eligible Individuals, need not be uniform among all SARs issued
                  pursuant
                  to the Plan, and may reflect distinctions based on the reasons
                  for
                  termination.

              

      

      

      
        	
                (h)

              	
                Nontransferability
                  of SARs. Except
                  as otherwise provided in an Award Agreement or otherwise at any
                  time by
                  the Committee, no SAR granted under the Plan may be sold,
                  transferred, pledged, assigned, or otherwise alienated or hypothecated,
                  other than by will or by the laws of descent and distribution.
                  Further,
                  except as otherwise provided in an Award Agreement or otherwise
                  at any
                  time by the Committee, all SARs granted to an Eligible Individual
                  under
                  the Plan shall be exercisable during his or her lifetime only by
                  such
                  Eligible Individual. With respect to those SARs, if any, that are
                  permitted to be transferred to another person, references in the
                  Plan to
                  exercise of the SAR by the Eligible Individual or payment of any
                  amount to
                  the Eligible Individual shall be deemed to include, as determined
                  by the
                  Committee, the Eligible Individual’s permitted
                  transferee.

              

      

      

      
        	
                (i)

              	
                Other
                  Restrictions. The
                  Committee shall impose such other conditions and/or restrictions
                  on any
                  Shares received upon exercise of a SAR granted pursuant to the
                  Plan as it
                  may deem advisable or desirable. These restrictions may include,
                  but shall
                  not be limited to, a requirement that the Eligible Individual hold
                  the
                  Shares received upon exercise of a SAR for a specified period of
                  time.

              

      

      

      SECTION
        7. Restricted
        Stock and Restricted Stock Units

       

      
        	
                (a)

              	
                Grant
                  of Restricted Stock or Restricted Stock Units.
                  Subject to the terms and provisions of the Plan, the Committee,
                  at any
                  time and from time to time, may grant Shares of Restricted Stock
                  and/or
                  Restricted Stock Units to Eligible Individuals in such amounts
                  as the
                  Committee shall determine. Restricted Stock Units shall be similar
                  to
                  Restricted Stock except that no Shares are actually awarded to
                  the
                  Eligible Individual on the date of grant.

              

      

      

      
        	
                (b)

              	
                Restricted
                  Stock or Restricted Stock Unit Agreement.
                  Each Restricted Stock and/or Restricted Stock Unit grant shall
                  be
                  evidenced by an Award Agreement that shall specify the Period(s)
                  of
                  Restriction, the number of Shares of Restricted Stock or the number
                  of
                  Restricted Stock Units granted, and such other provisions as the
                  Committee
                  shall determine. 

              

      

      

      
        	
                (c)

              	
                Transferability.
                  Except as provided in this Plan or an Award Agreement, the Shares
                  of
                  Restricted Stock and/or Restricted Stock Units granted herein may
                  not be
                  sold, transferred, pledged, assigned, or otherwise alienated or
                  hypothecated until the end of the applicable Period of Restriction
                  established by the Committee and specified in the Award Agreement
                  (and in
                  the case of Restricted Stock Units until the date of delivery or
                  other
                  payment), or upon earlier satisfaction of any other conditions,
                  as
                  specified by the Committee, in its sole discretion, and set forth
                  in the
                  Award Agreement or otherwise at any time by the Committee. All
                  rights with
                  respect to the Restricted Stock and/or Restricted Stock Units granted
                  to
                  an Eligible Individual under the Plan shall be available during
                  his or her
                  lifetime only to such Eligible Individual, except as otherwise
                  provided in
                  an Award Agreement or at any time by the Committee.
                  

              

      

      

      
        	
                (d)

              	
                Other
                  Restrictions.
                  The Committee shall impose such other conditions and/or restrictions
                  on
                  any Shares of Restricted Stock or Restricted Stock Units granted
                  pursuant
                  to the Plan as it may deem advisable including, without limitation,
                  a
                  requirement that Eligible Individuals pay a stipulated purchase
                  price for
                  each Share of Restricted Stock or each Restricted Stock Unit, restrictions
                  based upon the achievement of specific performance goals, time-based
                  restrictions on vesting following the attainment of the performance
                  goals,
                  time-based restrictions, and/or restrictions under applicable laws
                  or
                  under the requirements of any stock exchange or market upon which
                  such
                  Shares are listed or traded, or holding requirements or sale restrictions
                  placed on the Shares by the Company upon vesting of such Restricted
                  Stock
                  or Restricted Stock Units.

              

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      To
        the
        extent deemed appropriate by the Committee, the Company may retain any
        certificates representing Shares of Restricted Stock in the Company’s possession
        until such time as all conditions and/or restrictions applicable to such
        Shares
        have been satisfied or lapse.

      

      Notwithstanding
        the foregoing, but subject to the provisions of Section 8 hereof, no Award
        in
        the form of Restricted Stock or RSUs, the vesting of which is conditioned
        only
        upon the continued service of the Eligible Individual, shall vest earlier
        than
        the first, second and third anniversaries of the date of grant thereof, on
        each
        of which dates a maximum of one-third of the Shares subject to the Award
        may
        vest, and no award in the form of Restricted Stock or RSUs, the vesting of
        which
        is conditioned upon the attainment of a specified Performance Goal or Goals,
        shall vest earlier than the first anniversary of the date of grant
        thereof.

      

      SECTION
        8. Performance
        Units/Performance Shares

      

      
        	
                (a)

              	
                Grant
                  of Performance Units/Performance Shares.
                  Subject to the terms and provisions of the Plan, the Committee, at
                  any time and from time to time, may grant Performance Units and/or
                  Performance Shares to Eligible Individuals in such amounts and
                  upon such
                  terms as the Committee shall
                  determine.

              

      

      

      
        	
                (b)

              	
                Value
                  of Performance Units/Performance Shares.
                  Each Performance Unit shall have an initial value that is established
                  by the Committee at the time of grant. Each Performance Share shall
                  have
                  an initial value equal to the Fair Market Value of a Share on the
                  date of
                  grant. The Committee shall set Performance Measures in its discretion
                  which, depending on the extent to which they are met, will determine
                  the
                  value and/or number of Performance Units/Performance Shares that
                  will be
                  paid out to the Eligible Individual.

              

      

      

      
        	
                (c)

              	
                Earning
                  of Performance Units/Performance Shares.
                  Subject to the terms of this Plan, after the applicable Performance
                  Period has ended, the holder of Performance Units/Performance Shares
                  shall
                  be entitled to receive a payout of the value and number of Performance
                  Units/Performance Shares earned by the Eligible Individual over
                  the
                  Performance Period, to be determined as a function of the extent
                  to which
                  the corresponding Performance Measures have been
                  achieved.

              

      

      

      
        	
                (d)

              	
                Form
                  and Timing of Payment of Performance Units/Performance
                  Shares.
                  Payment of earned Performance Units/Performance Shares shall be
                  as
                  determined by the Committee and as evidenced in the Award Agreement.
                  Subject to the terms of the Plan, the Committee, in its sole
                  discretion, may pay earned Performance Units/Performance Shares in
                  the form of cash or in Shares (or in a combination thereof) equal
                  to the
                  value of the earned Performance Units/Performance Shares at the
                  close of
                  the applicable Performance Period, or as soon as practicable after
                  the end
                  of the Performance Period. Any Shares may be granted subject to
                  any
                  restrictions deemed appropriate by the Committee. The determination
                  of the
                  Committee with respect to the form of payout of such Awards shall
                  be set
                  forth in the Award Agreement pertaining to the grant of the
                  Award.

              

      

      

      
        	
                (e)

              	
                Termination
                  of Employment.
                  Each Award Agreement shall set forth the extent to which the Eligible
                  Individual shall have the right to retain Performance Units and/or
                  Performance Shares following termination of the Eligible Individual’s
                  employment with or provision of services to the Company, its Affiliates,
                  and/or its Subsidiaries, as the case may be. Such provisions shall
                  be
                  determined in the sole discretion of the Committee, shall be included
                  in
                  the Award Agreement entered into with each Eligible Individual,
                  need not
                  be uniform among all Awards of Performance Units or Performance
                  Shares
                  issued pursuant to the Plan, and may reflect distinctions based
                  on the
                  reasons for termination.

              

      

      

      
        	
                (f)

              	
                Nontransferability.
                  Except as otherwise provided in an Eligible Individual’s Award Agreement
                  or otherwise at any time by the Committee, Performance Units/Performance
                  Shares may not be sold, transferred, pledged, assigned, or otherwise
                  alienated or hypothecated, other than by will or by the laws of
                  descent
                  and distribution. Further, except as otherwise provided in an Eligible
                  Individual’s Award Agreement or otherwise at any time by the Committee, an
                  Eligible Individual’s rights under the Plan shall be exercisable during
                  his or her lifetime only by such Eligible
                  Individual.

              

      

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      SECTION
        9. Cash-Based
        Awards and Other Stock-Based Awards

       

      
        	
                (a)

              	
                Other
                  Stock-Based Awards. The
                  Committee may grant other types of equity-based or equity-related
                  Awards
                  not otherwise described by the terms of this Plan (including the
                  grant or
                  offer for sale of unrestricted Shares) in such amounts and subject
                  to such
                  terms and conditions, as the Committee shall determine. Such Awards
                  may
                  involve the transfer of actual Shares to Eligible Individuals,
                  or payment
                  in cash or otherwise of amounts based on the value of Shares and
                  may
                  include, without limitation, Awards designed to comply with or
                  take
                  advantage of the applicable local laws of jurisdictions other than
                  the
                  United States.

              

      

      

      
        	 	
                Except
                  with respect to a maximum of five percent (5%) of the Shares authorized
                  in
                  Section 3(d)(vi), any Awards of Other Stock-Based Awards which
                  vest on the
                  basis of the Eligible Individual’s continued employment with or provision
                  of service to the Company shall not provide for vesting which is
                  any more
                  rapid than annual pro rata vesting over a three (3) year period
                  and any
                  Awards of Other Stock-Based Awards which vest upon the attainment
                  of
                  Performance Measures shall provide for a performance period of
                  at least
                  twelve (12) months.

              

      

      

      
        	
                (b)

              	
                Grant
                  of Cash-Based Awards.
                  Subject to the terms and provisions of the Plan, the Committee, at
                  any time and from time to time, may grant Cash-Based Awards to
                  Eligible
                  Individuals in such amounts and upon such terms, including the
                  achievement
                  of specific Performance Measures, as the Committee may
                  determine.

              

      

      

      
        	
                (c)

              	
                Value
                  of Cash-Based and Other Stock-Based Awards.
                  Each Cash-Based Award shall specify a payment amount or payment
                  range as
                  determined by the Committee. Each Other Stock-Based Award shall
                  be
                  expressed in terms of Shares or units based on Shares, as determined
                  by
                  the Committee. The Committee may establish performance goals in
                  its
                  discretion. If the Committee exercises its discretion to establish
                  performance goals, the number and/or value of Cash-Based Awards
                  or Other
                  Stock-Based Awards that will be paid out to the Eligible Individual
                  will
                  depend on the extent to which the Performance Measures are met.
                  

              

      

      

      
        	
                (d)

              	
                Payment
                  of Cash-Based Awards and Other Stock-Based Awards.
                  Payment, if any, with respect to a Cash-Based Award or an Other
                  Stock-Based Award shall be made in accordance with the terms of
                  the Award,
                  in cash or Shares, or any combination thereof, as the Committee
                  determines.

              

      

      

      
        	
                (e)

              	
                Termination
                  of Employment. The
                  Committee shall determine the extent to which the Eligible Individual
                  shall have the right to receive Cash-Based Awards or Other Stock-Based
                  Awards following termination of the Eligible Individual’s employment with
                  or provision of services to the Company, its Affiliates, and/or
                  its
                  Subsidiaries, as the case may be. Such provisions shall be determined
                  in
                  the sole discretion of the Committee, such provisions may be included
                  in
                  an Award Agreement entered into with each Eligible Individual,
                  but need
                  not be uniform among all Awards of Cash-Based Awards or Other Stock-Based
                  Awards issued pursuant to the Plan, and may reflect distinctions
                  based on
                  the reasons for termination.

              

      

      

      
        	
                (f)

              	
                Nontransferability.
                  Except
                  as otherwise determined by the Committee, neither Cash-Based Awards
                  nor
                  Other Stock-Based Awards may be sold, transferred, pledged, assigned,
                  or
                  otherwise alienated or hypothecated, other than by will or by the
                  laws of
                  descent and distribution. Further, except as otherwise provided
                  by the
                  Committee, an Eligible Individual’s rights under the Plan, if exercisable,
                  shall be exercisable during his or her lifetime only by such Eligible
                  Individual. With respect to those Cash-Based Awards or Other Stock-Based
                  Awards, if any, that are permitted to be transferred to another
                  person,
                  references in the Plan to exercise or payment of such Awards by
                  or to the
                  Eligible Individual shall be deemed to include, as determined by
                  the
                  Committee, the Eligible Individual’s permitted
                  transferee.

              

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      SECTION
        10. Performance
        Measures

       

      
        	
                (a)

              	
                Performance
                  Measures. Unless
                  and until the Committee proposes for shareholder vote and the shareholders
                  approve a change in the general Performance Measures set forth
                  in this
                  Section 10, the Performance Measures upon which the payment or
                  vesting of
                  an Award to a Covered Employee (other than a Covered Employee Annual
                  Incentive Award awarded or credited pursuant to Section 11) that
                  is
                  intended to qualify as Qualified Performance-Based Award shall
                  be limited
                  to the following Performance
                  Measures:

              

      

      

      
        	
              	(i)	
                
                

              

      

      
        	
              	(ii)	
                Earnings
                  per share (basic or fully diluted);

              

      

      
        	
              	(iii)	
                Net
                  sales growth or bookings growth;

              

      

      
        	
              	(iv)	
                Net
                  operating profit;

              

      

      
        	
              	(v)	
                Return
                  measures (including, but not limited to, return on assets, capital,
                  net
                  capital utilized, equity, or
                  sales);

              

      

      
        	
              	(vi)	
                Cash
                  flow (including, but not limited to, operating cash flow, free
                  cash flow,
                  and cash flow return on capital);

              

      

      
        	
              	(vii)	
                Earnings
                  before or after taxes, interest, depreciation, and/or
                  amortization;

              

      

      
        	
              	(viii)	
                Gross
                  or operating profit;

              

      

      
        	
              	(ix)	
                Productivity
                  ratios;

              

      

      
        	
              	(x)	
                Efficiency
                  ratios;

              

      

      
        	
              	(xi)	
                Share
                  price (including, but not limited to, growth measures and total
                  shareholder return);

              

      

      
        	
              	(xii)	
                Expense
                  targets;

              

      

      
        	
              	(xiii)	
                Margins;

              

      

      
        	
              	(xiv)	
                Operating
                  efficiency;

              

      

      
        	
              	(xv)	
                Capital
                  efficiency;

              

      

      
        	
              	(xvi)	
                Strategic
                  targets;

              

      

      
        	
              	(xvii)	
                Economic
                  profit;

              

      

      
        	
              	(xviii)	
                Customer
                  satisfaction; 

              

      

      
        	
              	(xix)	
                Working
                  capital targets; 

              

      

      
        	
              	(xx)	
                Cash
                  value added (“CVA”); and

              

      

      
        	
              	(xxi)	
                Economic
                  value added (“EVA®”).

              

      

      

      
        	 	
                Any
                  Performance Measure(s) may be used to measure the performance of
                  the
                  Company, Subsidiary, and/or Affiliate as a whole or any business
                  unit of
                  the Company, Subsidiary, and/or Affiliate or any combination thereof,
                  as
                  the Committee may deem appropriate, or any of the above Performance
                  Measures as compared to the performance of a group of comparator
                  companies, or published or special index that the Committee, in
                  its sole
                  discretion, deems appropriate. The Committee also has the authority
                  to
                  provide for accelerated vesting of any Award based on the achievement
                  of
                  Performance Measures pursuant to the Performance Measures specified
                  in
                  this Section 10.

              

      

      

      
        	
                (b)

              	
                Evaluation
                  of Performance. The
                  Committee may provide in any such Award that any evaluation of
                  performance
                  may include or exclude any of the following events that occurs
                  during a
                  Performance Period: (i) asset write-downs, (ii) litigation or claim
                  judgments or settlements, (iii) the effect of changes in tax laws,
                  accounting principles, or other laws or provisions affecting reported
                  results, (iv) any reorganization and restructuring programs, (v)
                  extraordinary nonrecurring items as described in Accounting Principles
                  Board Opinion No. 30 and/or in Management’s Discussion and Analysis of
                  Financial Condition and Results of Operations appearing in the
                  Company’s
                  annual report to shareholders for the applicable year, (vi) acquisitions
                  or divestitures, (vii) foreign exchange gains and losses, and (viii)
                  gains
                  and losses on asset sales. To the extent such inclusions or exclusions
                  affect Awards to Covered Employees, they shall be prescribed in
                  a form
                  that meets the requirements of the Section 162(m)
                  Exemption.

              

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      

      
        	
                (c)

              	
                Adjustment
                  of Qualified Performance-Based Awards. Awards
                  that are designed to qualify as Qualified Performance-Based Awards,
                  and
                  that are held by Covered Employees, may not be increased. The Committee
                  shall retain the discretion to reduce such Awards, either on a
                  formula or
                  discretionary basis or any combination, as the Committee
                  determines.

              

      

      

      
        	
                (d)

              	
                Committee
                  Discretion.
                  In
                  the event that applicable tax and/or securities laws or stock exchange
                  listing requirements change to permit Committee discretion to alter
                  the
                  governing Performance Measures without obtaining shareholder approval
                  of
                  such changes, the Committee shall have sole discretion to make
                  such
                  changes without obtaining shareholder approval. In addition, in
                  the event
                  that the Committee determines that it is advisable to grant Awards
                  that
                  shall not qualify as Qualified Performance-Based Award, the Committee
                  may
                  make such grants without satisfying the requirements of Code Section
                  162(m) and may base vesting on Performance Measures other than
                  those set
                  forth in Section 10(a).

              

      

      

      SECTION
        11. Covered
        Employee Annual Incentive Awards

       

      
        	
                (a)

              	
                Establishment
                  of Incentive Pool. The
                  Committee may designate Covered Employees who are eligible to receive
                  a
                  monetary payment in any Plan Year based on a percentage of an incentive
                  pool equal to the greater of (i) ten percent (10%) of the Company’s gross
                  profit for the Plan Year, (ii) ten percent (10%) of the Company’s
                  consolidated operating earnings for the Plan Year, (iii) ten percent
                  (10%)
                  of the Company’s operating cash flow for the Plan Year, and (d) ten
                  percent (10%) of the Company’s net income for the Plan Year. The Committee
                  shall allocate an incentive pool percentage to each designated
                  Covered
                  Employee for each Plan Year. In no event may the incentive pool
                  percentage
                  for any one Covered Employee exceed twenty-five percent (25%) of
                  the total
                  pool for the Plan Year. The sum of the incentive pool percentages
                  for all
                  Covered Employees cannot exceed one hundred percent (100%) of the
                  total
                  pool for the Plan Year.

              

      

      

      
        	
                (b)

              	
                Determination
                  of Covered Employees’ Portions.
                  As
                  soon as possible after the determination of the incentive pool
                  for a Plan
                  Year, the Committee shall calculate each Covered Employee’s allocated
                  portion of the incentive pool based upon the percentage established
                  at the
                  beginning of the Plan Year. Each Covered Employee’s incentive award then
                  shall be determined by the Committee based on the Covered Employee’s
                  allocated portion of the incentive pool subject to adjustment in
                  the sole
                  discretion of the Committee. In no event may the portion of the
                  incentive
                  pool allocated to a Covered Employee be increased in any way, including
                  as
                  a result of the reduction of any other Covered Employee’s allocated
                  portion. The Committee shall retain the discretion to reduce such
                  Awards.

              

      

      

      SECTION
        12. Term,
        Amendment and Termination

       

      
        	
                (a)

              	
                Term.
                  The
                  Plan will terminate on the tenth anniversary of the effective date
                  of the
                  Plan, as provided in Section 18. Under the Plan, Awards outstanding
                  as of
                  such date shall not be affected or impaired by the termination
                  of the
                  Plan.

              

      

      

      
        	
                (b)

              	
                Amendment,
                  Modification, Suspension, and Termination.
                  Subject to Section 12(d), the Committee may, at any time and from
                  time to time, alter, amend, modify, suspend, or terminate the Plan
                  and any
                  Award Agreement in whole or in part; provided,
                  however,
                  that, without the prior approval of the Company’s shareholders and except
                  as provided in Sections 3(d) and 5(k), Stock Options or SARs issued
                  under
                  the Plan will not be repriced, replaced, or regranted through
                  cancellation, or by lowering the option price of a previously granted
                  Stock Option or the grant price of a previously granted SAR, and
                  no
                  amendment of the Plan shall be made without shareholder approval
                  if
                  shareholder approval is required by law, regulation, or stock exchange
                  rule.

              

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      

      
        	
                (c)

              	
                Adjustment
                  of Awards Upon the Occurrence of Certain Unusual or Nonrecurring
                  Events.
                  The Committee may make adjustments in the terms and conditions
                  of, and the
                  criteria included in, Awards in recognition of unusual or nonrecurring
                  events (including, without limitation, the events described in
                  Section
                  3(e) hereof) affecting the Company or the financial conditions
                  of the
                  Company or of changes in applicable laws, regulations, or accounting
                  principles, whenever the Committee determines that such adjustments
                  are
                  appropriate in order to prevent unintended dilution or enlargement
                  of the
                  benefits or potential benefits intended to be made available under
                  the
                  Plan. The determination of the Committee as to the foregoing adjustments,
                  if any, shall be conclusive and binding on Eligible Individuals
                  under the
                  Plan. 

              

      

      

      
        	
                (d)

              	
                Awards
                  Previously Granted.
                  Notwithstanding any other provision of the Plan to the contrary,
                  no
                  termination, amendment, suspension, or modification of the Plan
                  or an
                  Award Agreement shall adversely affect in any material way any Award
                  previously granted under the Plan, without the written consent
                  of the
                  Eligible Individual holding such Award.

              

      

      

      SECTION
        13. Change
        of Control Provisions

       

      
        	
                (a)

              	
                Impact
                  of Event.
                  Notwithstanding any other provision of the Plan to the contrary,
                  in the
                  event of a Change of Control:

              

      

      

      (i) Any
        Stock
        Options and SARs outstanding as of the date such Change of Control is determined
        to have occurred, and which are not then exercisable and vested, shall become
        fully exercisable and vested to the full extent of the original
        grant.

      

      (ii) The
        restrictions and deferral limitations applicable to any Restricted Stock
        or RSU
        shall lapse, and such Restricted Stock or RSU shall become free of all
        restrictions and become fully vested and transferable to the full extent
        of the
        original grant.

      

      (iii) The
        incentive pool used to determine Covered Employee Annual Incentive Awards
        shall
        be based on the gross profit, consolidated operating earnings, operating
        cash
        flow or net income of the Plan Year immediately preceding the year of the
        Change
        of Control, or such other method of payment as may be determined by the
        Committee at the time of the Award or thereafter but prior to the Change
        of
        Control;

      

      (iv) The
        target payout opportunities attainable under all outstanding Awards of
        Restricted Stock or Restricted Stock Units whose restrictions are based on
        performance criteria, Performance Units, and Performance Shares, shall be
        deemed
        to have been fully earned based on targeted performance being attained as
        of the
        effective date of the Change of Control;

      

      (v) The
        vesting of all Awards denominated in Shares shall be accelerated as of the
        effective date of the Change of Control, and shall be paid out to Eligible
        Individuals within thirty (30) days following the effective date of the Change
        of Control. The Committee has the authority to pay all or any portion of
        the
        value of the Shares in cash;

      

      (vi) Awards
        denominated in cash shall be paid to Eligible Individuals in cash within
        thirty
        (30) days following the effective date of the Change of Control;

      

      (vii) Upon
        a
        Change of Control, unless otherwise specifically provided in a written agreement
        entered into between the Eligible Individual and the Company, the Committee
        shall pay out all Cash-Based and Other Stock-Based Awards; and

      

      (viii) The
        Committee may also make additional adjustments and/or settlements of outstanding
        Awards as it deems appropriate and consistent with the Plan’s
        purposes.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	
                (b)

              	
                Definition
                  of Change of Control.
                  For purposes of the Plan, a “Change of Control” shall mean the happening
                  of any of the following events:

              

      

      

      (i) An
        acquisition by any individual, entity or group (within the meaning of Section
        13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership
        (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of
        30% or
        more of either (a) the then outstanding Shares of the Company (the “Outstanding
        Company Shares”) or (b) the combined voting power of the then outstanding voting
        securities of the Company entitled to vote generally in the election of
        directors (the “Outstanding Company Voting Securities”); excluding, however, the
        following: (w) any acquisition directly from the Company, other than an
        acquisition by virtue of the exercise of a conversion privilege unless the
        security being so converted was itself acquired directly from the Company,
        (x)
        any acquisition by the Company, (y) any acquisition by any employee benefit
        plan
        (or related trust) sponsored or maintained by the Company or any entity
        controlled by the Company, or (z) any acquisition pursuant to a transaction
        which complies with clauses (1), (2) and (3) of subsection (iii) of this
        Section
        13(b); or

      

      (ii) Individuals
        who, as of the effective date of the Plan, constitute the Board (the "Incumbent
        Board") cease for any reason to constitute at least a majority of the Board;
        provided,
        however,
        that any
        individual who becomes a member of the Board subsequent to such effective
        date
        of the Plan, whose election, or nomination for election by the Company's
        shareholders, was approved by a vote of at least a majority of directors
        then
        comprising the Incumbent Board shall be considered as though such individual
        were a member of the Incumbent Board; but, provided
        further,
        that any
        such individual whose initial assumption of office occurs as a result of
        either
        an actual or threatened election contest (as such terms are used in Rule
        14a-11
        of Regulation 14A promulgated under the Exchange Act) or other actual or
        threatened solicitation of proxies or consents by or on behalf of a Person
        other
        than the Board shall not be so considered as a member of the Incumbent Board;
        or

      

      (iii) The
        consummation of a reorganization, merger or consolidation or sale or other
        disposition of all or substantially all of the assets of the Company (“Business
        Combination”); excluding, however, such a Business Combination pursuant to which
        (1) all or substantially all of the individuals and entities who are the
        beneficial owners, respectively, of the Outstanding Company Shares and
        Outstanding Company Voting Securities immediately prior to such Business
        Combination will beneficially own, directly or indirectly, more than 60%
        of,
        respectively, the outstanding Shares, and the combined voting power of the
        outstanding voting securities entitled to vote generally in the election
        of
        directors, as the case may be, of the corporation resulting from such Business
        Combination (including, without limitation, a corporation which as a result
        of
        such transaction owns the Company or all or substantially all of the Company's
        assets either directly or through one or more subsidiaries) in substantially
        the
        same proportions as their ownership, immediately prior to such Business
        Combination, of the Outstanding Company Shares and Outstanding Company Voting
        Securities, as the case may be, (2) no Person (other than any employee benefit
        plan (or related trust) sponsored or maintained by the Company or any entity
        controlled by the Company or such corporation resulting from such Business
        Combination) will beneficially own, directly or indirectly, 30% or more of,
        respectively, the outstanding shares of the corporation resulting from such
        Business Combination or the combined voting power of the outstanding voting
        securities of such corporation entitled to vote generally in the election
        of
        directors except to the extent that such ownership existed with respect to
        the
        Company prior to the Business Combination and (3) at least a majority of
        the
        members of the board of directors of the corporation resulting from such
        Business Combination will have been members of the Incumbent Board at the
        time
        of the execution of the initial agreement, or of the action of the Board,
        providing for such Business Combination; or

      

      (iv) The
        consummation of a complete liquidation or dissolution of the
        Company.

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      SECTION
        14. Unfunded
        Status of Plan

       

      It
        is
        presently intended that the Plan constitute an “unfunded” plan for incentive and
        deferred compensation. The Committee may authorize the creation of trusts
        or
        other arrangements to meet the obligations created under the Plan to deliver
        Shares or make payments; provided, however, that unless the Committee otherwise
        determines, the existence of such trusts or other arrangements is consistent
        with the “unfunded” status of the Plan.

      

      SECTION
        15. Uncertificated
        Shares

       

      To
        the
        extent that the Plan provides for issuance of certificates to reflect the
        transfer of Shares, the transfer of such Shares may be effected on a
        noncertificated basis, to the extent not prohibited by applicable law or
        the
        rules of any stock exchange on which Shares are listed.

      

      SECTION
        16. Withholding

       

      
        	
                (a)

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

              

      

      

      
        	
                (b)

              	
                Share
                  Withholding.
                  With respect to withholding required upon the exercise of Options
                  or SARs,
                  upon the lapse of restrictions on Restricted Stock and Restricted
                  Stock
                  Units, or upon the achievement of Performance Measures related
                  to
                  Performance Shares, or any other taxable event arising as a result
                  of an
                  Award granted hereunder, Eligible Individuals may elect, subject
                  to the
                  approval of the Committee, to satisfy the withholding requirement,
                  in
                  whole or in part, by having the Company withhold Shares having
                  a Fair
                  Market Value on the date the tax is to be determined equal to the
                  minimum
                  statutory total tax that could be imposed on the transaction. All
                  such
                  elections shall be irrevocable, made in writing, and signed by
                  the
                  Eligible Individual, and shall be subject to any restrictions or
                  limitations that the Committee, in its sole discretion, deems
                  appropriate.

              

      

      

      SECTION
        17. General
        Provisions

       

      
        	
                (a)

              	
                The
                  Committee may require each person purchasing or receiving Shares
                  pursuant
                  to an Award to represent to and agree with the Company in writing
                  that
                  such person is acquiring the Shares without a view to the distribution
                  thereof. The certificates or book-entry registration for such Shares
                  may
                  include any legend which the Committee deems appropriate to reflect
                  any
                  restrictions on transfer.

              

      

      

      
        	
                (b)

              	
                Notwithstanding
                  any other provision of the Plan or agreements made pursuant thereto,
                  the
                  Company shall not be required to issue or deliver any Shares under
                  the
                  Plan prior to fulfillment of all of the following
                  conditions:

              

      

      

      (i) Listing
        or approval for listing upon notice of issuance, of such Shares on the New
        York
        Stock Exchange, Inc., or such other securities exchange as may at the time
        be
        the principal market for the Shares;

      

      (ii) Any
        registration or other qualification of such Shares under any state or federal
        law or regulation, or the maintaining in effect of any such registration
        or
        other qualification which the Committee shall, in its absolute discretion
        upon
        the advice of counsel, deem necessary or advisable; and

      

      (iii) Obtaining
        any other consent, approval, or permit from any state or federal governmental
        agency which the Committee shall, in its absolute discretion after receiving
        the
        advice of counsel, determine to be necessary or advisable.

      

      
        	
                (c)

              	
                Nothing
                  contained in the Plan shall prevent the Company or any Subsidiary
                  from
                  adopting other or additional compensation arrangements for its
                  employees.

              

      

      

      
        	
                (d)

              	
                The
                  Plan shall not constitute a contract of employment and neither
                  adoption of
                  the Plan nor the grant of an Award shall confer upon any employee
                  any
                  right to continued employment, nor shall it interfere in any way
                  with the
                  right of the Company or any Subsidiary to terminate the employment
                  of any
                  employee at any time.

              

      

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      
        	
                (e)

              	
                The
                  Committee shall establish such procedures as it deems appropriate
                  for an
                  Eligible Individual to designate a beneficiary to whom any amounts
                  payable
                  in the event of the Eligible Individual's death are to be paid
                  or by whom
                  any rights of the Eligible Individual, after the Eligible Individual's
                  death, may be exercised.

              

      

      

      
        	
                (f)

              	
                In
                  the case of a grant of an Award to any employee of a Subsidiary
                  of the
                  Company, the Company may, if the Committee so directs, issue or
                  transfer
                  the Shares, if any, covered by the Award to the Subsidiary, for
                  such
                  lawful consideration as the Committee may specify, upon the condition
                  or
                  understanding that the Subsidiary will transfer the Shares to the
                  employee
                  in accordance with the terms of the Award specified by the Committee
                  pursuant to the provisions of the Plan. All Shares underlying Awards
                  that
                  are forfeited or canceled shall revert to the
                  Company.

              

      

      

      
        	
                (g)

              	
                The
                  Plan and all Awards made and actions taken thereunder shall be
                  governed by
                  and construed in accordance with the laws of the State of Delaware,
                  without reference to principles of conflict of
                  laws.

              

      

      

      
        	
                (h)

              	
                Each
                  person who is or shall have been a member of the Board, or a Committee
                  appointed by the Board, or an officer of the company to whom authority
                  was
                  delegated in accordance with Section 2 shall be indemnified and
                  held
                  harmless by the Company against and from any loss, cost, liability,
                  or
                  expense that may be imposed upon or reasonably incurred by him
                  or her in
                  connection with or resulting from any claim, action, suit, or proceeding
                  to which he or she may be a party or in which he or she may be
                  involved by
                  reason of any action taken or any failure to act under the Plan
                  and
                  against and from any and all amounts paid by him or her in settlement
                  thereof, with the Company’s approval, or paid by him or her in
                  satisfaction of any judgment in any such action, suit, or proceeding
                  against him or her, provided he or she shall give the Company an
                  opportunity, at its own expense, to handle and defend the same
                  before he
                  or she undertakes to handle and defend it on his or her own behalf,
                  unless
                  such loss, cost, liability, or expense is a result of his or her
                  own
                  willful misconduct or gross negligence or except as expressly provided
                  by
                  statute. The foregoing right of indemnification shall not be exclusive
                  of
                  any other rights of indemnification to which such persons may be
                  entitled
                  under the Company’s Certificate of Incorporation or By-Laws, as a matter
                  of law, or otherwise, or any power that the Company may have to
                  indemnify
                  them or hold them harmless.

              

      

      

      
        	
                (i)

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

              

      

      

      
        	
                (j)

              	
                Notwithstanding
                  any provision of the Plan to the contrary, in order to comply with
                  the
                  laws in other countries in which the Company, its Affiliates, and/or
                  its
                  Subsidiaries
                  operate or have employees, the
                  Committee, in its sole discretion, shall have the power and authority
                  to:

              

      

      

      (i) Determine
        which Affiliates and Subsidiaries shall be covered by the Plan;

      

      (ii) Determine
        which employees outside the United States are eligible to participate in
        the
        Plan;

      

      (iii) Modify
        the terms and conditions of any Award granted to employees outside the United
        States to comply with applicable foreign laws;

      

      (iv) Establish
        subplans and modify exercise procedures and other terms and procedures, to
        the
        extent such actions may be necessary or advisable. Any subplans and
        modifications to Plan terms and procedures established under this Section
        by the
        Committee shall be attached to this Plan document as appendices;
        and

      

      (v) Take
        any
        action, before or after an Award is made, that it deems advisable to obtain
        approval or comply with any necessary local government regulatory exemptions
        or
        approvals.

      

      Notwithstanding
        the above, the Committee may not take any actions hereunder, and no Awards
        shall
        be granted, that would violate applicable law.

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      

      SECTION
        18. Effective
        Date of Plan

       

      The
        Plan
        shall be effective as of the date it is approved by the shareholders of the
        Company.

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