Document:

EX-10.1 AMENDMENT NO.2 TO CREDIT AGREEMENT

 

Exhibit 10.1

AMENDMENT NO. 2 TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT

     THIS AMENDMENT NO. 2 TO FIRST AMENDED AND RESTATED CREDIT AGREEMENT dated as of August 15,
2006 (this “Amendment”) by and among CRAWFORD & COMPANY, a Georgia corporation
(“Crawford”) and CRAWFORD & COMPANY INTERNATIONAL, INC., a Georgia corporation
(“International”; International and Crawford are collectively referred to herein as the
“Borrowers”, and each individually as a “Borrower”), the LENDERS party hereto (the
“Lenders”) and SUNTRUST BANK (“SunTrust”), as administrative agent for the Lenders
(in such capacity, together with its successors in such capacity, the “Administrative
Agent”).

     WHEREAS, the Borrowers, the Lenders and Administrative Agent are parties to the Revolving
Credit Agreement dated as of September 30, 2003, as amended and restated by that certain First
Amended and Restated Credit Agreement dated as of September 30, 2005 and amended by that Amendment
No. 1 to First Amended and Restated Credit Agreement (as so amended, the “Credit
Agreement”); and

     WHEREAS, the Borrowers have requested that the definition of “LC Commitment” in the Credit
Agreement be amended, and the Lenders are willing to make such an amendment on the terms and
conditions set forth below.

     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged by the parties hereto, the parties hereto hereby agree as follows:

     Section 1. Amendment to Credit Agreement. The Credit Agreement is hereby amended by
amending and restating in its entirety the defined term “LC Commitment” contained in Section 1.1.
of the Credit Agreement as follows:

“LC Commitment” shall mean that portion of the Aggregate Resolving Commitments that
may be used by the Borrowers for the issuance of Letters of Credit in an aggregate
stated amount not to exceed $20,000,000.

     Section 2. Representations and Warranties. The Borrowers hereby represent and warrant
to the Lenders and the Administrative Agent that as of the date the conditions precedent set forth
in Section 3 below have been satisfied:

     (a) the representations and warranties set forth in Article IV of the Credit
Agreement (as amended by this Amendment) are true and correct in all material respects as of
the date the conditions precedent set forth in Section 3 below have been satisfied, except
to the extent such representations and warranties specifically relate to an earlier date, in
which case such representations and warranties shall have been true, correct and complete in
all material respects on and as of such earlier date;

     (b) the execution and delivery by the Borrowers of this Amendment are within the
corporate power and authority of the Borrowers, have been duly authorized by all

 

 

requisite
corporate action of the Borrowers, and do not and will not contravene any provision of
applicable law or the Borrowers’ articles of incorporation or by-laws, or any amendment
thereof, or any indenture, agreement, instrument or undertaking binding on the Borrowers,
including, without limitation, the Note Purchase Agreement. This Amendment has been duly
executed by the Borrowers;

     (c) the Credit Agreement and the other Loan Documents remain in full force and effect
and constitute the legal, valid and binding obligations of the Borrowers, enforceable in
accordance with their terms, except as limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or affecting generally the enforcement of creditor’s
rights;

     (d) on and as of the date the conditions precedent set forth in Section 3 below have
been satisfied, and after giving effect to this Amendment, no Default or Event of Default
has occurred or will otherwise exist; and

     (e) all Subsidiary Loan Parties, and all Subsidiaries of Crawford that are required to
be or become a Subsidiary Loan Party pursuant to Section 5.10 of the Credit Agreement, have
duly executed and delivered the Reaffirmation (as defined below).

     Section 3. Conditions Precedent. The amendment of the Credit Agreement shall become
effective as of the date that the Administrative Agent shall have received each of the following,
in form and substance satisfactory to it:

     (a) This Amendment, duly executed and delivered by the Borrowers, the Lenders and the
Administrative Agent;

     (b) A Reaffirmation of Obligations under Loan Documents (the “Reaffirmation”)
duly executed by the Borrowers, the Administrative Agent, the Lenders and each of the
Subsidiary Loan Parties, in the form of Exhibit A attached hereto;

     (c) Such other documents as the Administrative Agent on behalf of the Lenders may
reasonably request.

     Section 4. Release. In consideration of the amendment contained herein, the
Borrowers hereby waive and release each of the Lenders, the Administrative Agent and the Issuing
Bank from any and all claims and defenses, known or unknown, with respect to the Credit Agreement
and the other Loan Documents and the transactions contemplated thereby

     Section 5. Expenses. The Borrowers jointly and severally agree to reimburse the
Administrative Agent on demand for all reasonable out-of-pocket costs and expenses (including,
without limitation, attorneys’ fees) incurred by it in negotiating, documenting and consummating
this Amendment and the transactions contemplated hereby.

     Section 6. Miscellaneous. Except as herein provided, the Credit Agreement shall
remain unchanged and in full force and effect. This Amendment may be executed in any number of

- 2 -

 

counterparts, all of which taken together shall constitute one and the same instrument and any of
the parties hereto may execute this Amendment by signing any such counterpart and sending the same
by telecopier, mail, messenger or courier to the Administrative Agent. This Amendment shall be
governed by, and construed in accordance with, the law of the State of New York. Each reference to
the Credit Agreement in any of the Loan Documents (including the Credit Agreement) shall be deemed
to be a reference to the Credit Agreement, as amended by this Amendment. This Amendment shall be
binding upon and shall inure to the benefit of the parties hereto and their respective permitted
successors and assigns.

     Section 13. Definitions. All capitalized terms not otherwise defined herein are used
herein with the respective definitions given them in the Credit Agreement.

[Signature Page Follows]

- 3 -

 

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2 to First Amended
and Restated Credit Agreement to be duly executed as of the date first above written.

	 	 	 	 	 	 	 
	 	 	BORROWERS
	 
	 	 	 	 	 	 
	 	 	CRAWFORD & COMPANY
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joseph R. Caporaso	 	 
	 

	 	 	 	 

Name: Joseph R. Caporaso
	 	 
	 

	 	 	 	Title: Senior Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	U.S. Federal Tax Identification No.: 58-0506554
	 
	 	 	 	 	 	 
	 	 	CRAWFORD & COMPANY
	 	 	     INTERNATIONAL, INC.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joseph R. Caporaso	 	 
	 

	 	 	 	 

Name: Joseph R. Caporaso
	 	 
	 

	 	 	 	Title: Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	U.S. Federal Tax Identification No.: 58-1925694

Notice Address:
	 
	 	 	 	 	 	 
	 	 	5620 Glenridge Drive N.E.
	 	 	Atlanta, Georgia 30342
	 	 	Attention: Joe Caporaso
	 	 	Telecopy No.: 404-845-3127

 

 

	 	 	 	 	 	 	 
	 	 	LENDERS
	 
	 	 	 	 	 	 
	 	 	SUNTRUST BANK,
	 	 	     as Administrative Agent, Issuing Bank,
	 	 	     as Swingline Lender and as a Lender
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Kelly Gunter	 	 
	 

	 	 	 	 

Name: Kelly Gunter

Title: Vice President
	 	 
	 
	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A.,
	 	 	     as Syndication Agent and a Lender
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Kirsten Carver	 	 
	 

	 	 	 	 

Name: Kirsten Carver

Title: Vice President
	 	 
	 
	 	 	 	 	 	 
	 	 	CITIBANK, N.A.,
	 	 	     as a Lender
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ George Van	 	 
	 

	 	 	 	 

Name: George Van

Title: Vice President
	 	 

 

 

EXHIBIT A

REAFFIRMATION OF OBLIGATIONS UNDER LOAN DOCUMENTS

     Reference is hereby made to that certain First Amended and Restated Credit Agreement dated as
of September 30, 2005 among Crawford & Company, Crawford & Company International, Inc., the Lenders
a party thereto and SunTrust Bank, as Administrative Agent, as amended pursuant to that certain
Amendment No. 1 to First Amended and Restated Credit Agreement dated as of June 16, 2006 and as
amended pursuant to that certain Amendment No. 2 to First Amended and Restated Credit Agreement
dated as of August 15, 2006 (as so amended, the “Credit Agreement”; capitalized terms used
herein and not defined herein have the meanings ascribed to such terms in the Credit Agreement).

     Crawford hereby (i) reaffirms its continuing obligations owing to the Collateral Agent (as
defined in the Pledge Agreement) and the Lenders under the Pledge Agreement and (ii) confirms that
the liens and security interests created by the Pledge Agreement continue to secure the Pledged
Obligations (as defined in the Pledge Agreement).

     Each of the undersigned Loan Parties hereby reaffirms its continuing obligations owing to the
Administrative Agent and the Lenders under each of the other Loan Document (including, without
limitation, the Notes and the Subsidiary Guaranty Agreement) to which such Person is a party, and
each Loan Party agrees that the amendments contained in Amendment No. 2 to First Amended and
Restated Credit Agreement shall not in any way affect the validity and/or enforceability of any
such other Loan Document, or reduce, impair or discharge the obligations of such Person thereunder.

     Each of the undersigned Loan Parties hereby represents and warrants to the Collateral Agent,
the Administrative Agent and the Lenders that: (a) the execution and delivery by the Loan Parties
of this Reaffirmation is within the power (corporate or otherwise) and authority of the Loan
Parties, has been duly authorized and approved by all requisite action on the part of the Loan
Parties, and does not and will not contravene, breach or conflict with any provision of applicable
law or any of the charter or other organic documents of the Loan Parties, or any indenture,
agreement, instrument or undertaking binding on the Loan Parties; (b) this Reaffirmation has been
duly executed by the Loan Parties; (c) the Loan Documents remain in full force and effect and
constitute the legal, valid and binding obligations of the Loan Parties, enforceable in accordance
with their terms, except as limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws relating to or affecting generally the enforcement of creditor’s rights; and (d) all
of the Obligations are absolute and unconditional, and such Obligations are not subject to any
claim, defense, deduction, right of offset or otherwise.

     This Reaffirmation shall be construed in accordance with and be governed by the law (without
giving effect to the conflict of law principles thereof) of the State of New York.

 

 

     IN WITNESS WHEREOF, each of the undersigned has duly executed and delivered this Reaffirmation
of Obligations under Loan Documents as of August 15, 2006.

	 	 	 	 	 	 	 
	 	 	CRAWFORD & COMPANY
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joseph R. Caporaso	 	 
	 

	 	 	 	 

Name: Joseph R. Caporaso
	 	 
	 

	 	 	 	Title: Senior Vice President & Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	CRAWFORD & COMPANY
	 	 	  INTERNATIONAL, INC.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joseph R. Caporaso	 	 
	 

	 	 	 	 

Name: Joseph R. Caporaso
	 	 
	 

	 	 	 	Title: Vice President & Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	CRAWFORD LEASING SERVICES, INC.
	 	 	THE PRISM NETWORK, INC.
	 	 	CALESCO, INC.
	 	 	CRAWFORD & COMPANY
	 	 	  OF NEW YORK, INC.
	 	 	CRAWFORD & COMPANY
	 	 	  HEALTHCARE MANAGEMENT, INC.
	 	 	RISK SCIENCES GROUP, INC.
	 	 	QIRRA CUSTOM SOFTWARE, INC.
	 	 	BROCKLEHURST MILLER, INC.
	 	 	BROCKLEHURST, INC.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joseph R. Caporaso	 	 
	 

	 	 	 	 

Name: Joseph R. Caporaso
	 	 
	 

	 	 	 	Title: Treasurer	 	 

 

 

[Signature page to Crawford / Reaffirmation of Obligations

under Loan Documents dated as of August 15, 2006]

	 	 	 	 	 	 	 
	 	 	CRAWFORD INVESTIGATION
	 	 	  SERVICES, INC.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ John F. Pflanz	 	 
	 

	 	 	 	Name: John F. Pflanz	 	 
	 

	 	 	 	Title: President	 	 
	 
	 	 	 	 	 	 
	 	 	CRAWFORD & COMPANY, L.P.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	CRAWFORD & COMPANY,	 	 
	 

	 	 	 	as General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joseph R. Caporaso	 	 
	 

	 	 	 	Name: Joseph R. Caporaso	 	 
	 

	 	 	 	Title: Senior Vice President & Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	THE GARDEN CITY GROUP, INC.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joseph R. Caporaso	 	 
	 

	 	 	 	Name: Joseph R. Caporaso	 	 
	 

	 	 	 	Title: Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	CRAWFORD & COMPANY
	 	 	  OF CALIFORNIA
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Jeffrey B. Van Fleet	 	 
	 

	 	 	 	Name: Jeffrey B. Van Fleet	 	 
	 

	 	 	 	Title: President	 	 

 

 

[Signature page to Crawford / Reaffirmation of Obligations

under Loan Documents dated as of August 15, 2006]

	 	 	 	 	 	 	 
	 	 	CRAWFORD & COMPANY OF ILLINOIS
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joseph P. Rainey	 	 
	 

	 	 	 	Name: Joseph P. Rainey	 	 
	 

	 	 	 	Title: President	 	 
	 
	 	 	CRAWFORD & COMPANY OF FLORIDA
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Henry Taylor	 	 
	 

	 	 	 	Name: Henry Taylor	 	 
	 

	 	 	 	Title: President	 	 
	 
	 	 	 	 	 	 
	 	 	CRAWFORD & COMPANY
	 	 	  EMPLOYMENT SERVICES, INC.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Matt C. Wilkinson	 	 
	 

	 	 	 	Name: Matt C. Wilkinson	 	 
	 

	 	 	 	Title: President	 	 
	 
	 	 	 	 	 	 
	 	 	CRAWFORD HEALTHCARE
	 	 	MANAGEMENT OF NORFOLK
	 	 	AND BALTIMORE, INC.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ William L. Beach	 	 
	 

	 	 	 	Name: William L. Beach	 	 
	 

	 	 	 	Title: Vice President & Secretary	 	 

[End of Signatures]EX-4.1 Stock Incentive Plan

 

Exhibit 4.1

ION MEDIA NETWORKS, INC.

2006 STOCK INCENTIVE PLAN

     1. Objectives of the Plan. The objectives of this Stock Incentive Plan are to advance
the interests of the Company and its stockholders by providing the means to attract and retain
qualified personnel for positions of substantial responsibility and to provide additional
incentives to Employees and Consultants, consistent with the Company’s goals, that align the
interests of participants with those of the Company’s stockholders. Awards granted under the Plan
may be Incentive Stock Options, Nonqualified Stock Options, Stock Awards, Performance Units,
Performance Shares or Stock Appreciation Rights.

     2. Definitions. As used herein, the following definitions shall apply:

          “Applicable Law” means the legal requirements relating to the administration of the
Plan under applicable federal, state, local and foreign corporate, tax and securities laws, and the
rules and requirements of any stock exchange or quotation system on which the Common Stock is
listed or quoted.

          “Award” means an Option, Stock Appreciation Right, Stock Award, Performance Unit or
Performance Share granted under the Plan.

          “Award Agreement” means the agreement, notice or terms or conditions by which an Award
is evidenced, documented in such form (including by electronic communication) as may be approved by
the Committee.

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

          “Cause” means, except as otherwise may be provided under any agreement under which any
Award is made under this Plan:

               (1) A Grantee’s arrest for the commission of (A) a felony, (B) two offenses for operating a
motor vehicle while impaired by or under the influence of alcohol or illegal drugs, (C) any
criminal act with respect to Grantee’s employment (including any criminal act involving a violation
of the Communications Act of 1934, as amended, or regulations promulgated by the Federal
Communications Commission), or (D) any act that materially threatens to result in suspension,
revocation, or adverse modification of any FCC license of any broadcast station owned by any
affiliate of the Company or would subject any such broadcast station to fine or forfeiture;

               (2) Grantee’s taking of any action or failure to take action, without knowledge or concurrence
of the Company officer to whom the Grantee reports (or the Board of Directors, in the case of the
Chief Executive Officer) which would cause the Company to be in material default under any material
contract, lease or other agreement;

 

 

               (3) Grantee’s dependence on alcohol or illegal drugs;

               (4) Grantee’s failure or refusal to perform his or her employment duties according to or
following the lawful policies and directives of the Chairman of the Board or the Chief Executive
Officer or such other officer or employee to which Grantee reports;

               (5) Grantee’s misappropriation, conversion or embezzlement of the assets of the Company or any
affiliate of the Company; or

               (6) A material breach of any employment agreement between Grantee and the Company or the
occurrence of any other event or condition constituting “cause” under any such employment
agreement.

          “Change in Control” means the occurrence of any of the following events:

               (a) Any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Exchange Act or any successor provisions), other than any one or more of the Permitted Holders,
becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of the Company representing fifty percent (50%) or more of the combined
voting power of the Company’s then outstanding securities (for purposes of this clause (a), such
person or group shall be deemed to beneficially own any voting stock of a corporation held by any
other corporation (the “parent corporation”) so long as such person or group beneficially owns,
directly or indirectly, in the aggregate a majority of the total voting power of the voting stock
of such parent corporation, and in the case of securities that are convertible into or exercisable
for voting securities, where exercise or conversion would be subject to the prior approval of the
Federal Communications Commission, a person or group shall be deemed not to beneficially own such
voting securities until it has received such approval);

               (b) the Company merges, consolidates or amalgamates with or into any other Person or any other
Person merges, consolidates or amalgamates with or into the Company, in any such event pursuant to
a transaction in which the outstanding voting stock of the Company is reclassified into or
exchanged for cash, securities or other property, other than any such transaction where (i) the
outstanding voting stock of the Company is reclassified into or exchanged for other voting stock of
the Company or for voting stock of the surviving entity and (ii) the holders of the voting stock of
the Company immediately prior to such transaction, together with the Permitted Holders, own,
directly or indirectly, not less than a majority of the voting stock of the Company or the
surviving entity immediately after such transaction and in substantially the same proportion as
before the transaction;

               (c) during any period of two consecutive years, individuals who at the beginning of such
period constituted the Board (together with any new directors whose election or appointment by such
Board or whose nomination for election by the stockholders of the Company was approved by a vote of
not less than a majority of the directors then still in office who were either directors at the
beginning of such period or whose election or nomination for election was previously so approved)
cease for any reason to constitute a majority of the Board then in office; or

2

 

               (d) the stockholders of the Company shall have approved any plan of liquidation or dissolution
of the Company or the sale of all or substantially all of the assets of the Company.

          “Change in Control Price” means, as determined by the Board,

               (a) the highest Fair Market Value of a Share within the 60 day period immediately preceding
the date of determination of the Change in Control Price by the Board (the “60-Day Period”), or

               (b) the highest price paid or offered per Share, as determined by the Board, in any bona fide
transaction or bona fide offer related to the Change in Control of the Company, at any time within
the 60-Day Period, or

               (c) some lower price as the Board, in its discretion, determines to be a reasonable estimate
of the fair market value of a Share.

          “Code” means the Internal Revenue Code of 1986, as amended.

          “Committee” means the Compensation Committee appointed by the Board. If the Board does
not appoint a Compensation Committee, or in the case of any Award to members of the Committee,
“Committee” means the Board.

          “Common Stock” means the Class A Common Stock, $.001 par value, of the Company.

          “Company” means Paxson Communications Corporation, a Delaware corporation, d/b/a Ion
Media Networks.

          “Consultant” means any person, including an advisor, engaged by the Company or a
Subsidiary to render services and who is compensated for such services, including without
limitation non-Employee Directors who are compensated by the Company for their services as
non-Employee Directors. In addition, as used herein, “consulting relationship” shall be deemed to
include service by a non-Employee Director as such.

          “Continuous Status as an Employee or Consultant” means that the employment or
consulting relationship is not interrupted or terminated by the Company or any Subsidiary.
Continuous Status as an Employee or Consultant shall not be considered interrupted in the case of
(i) any leave of absence approved in writing by the Board, an Officer, or a person designated in
writing by the Board or an Officer as authorized to approve a leave of absence, including sick
leave, military leave, or any other personal leave; provided, however, that for purposes of
Incentive Stock Options, any such leave may not exceed 90 days, unless reemployment upon the
expiration of such leave is guaranteed by contract (including certain Company policies) or statute,
or (ii) transfers between locations of the Company or between the Company, a Subsidiary or
successor of the Company; or (iii) a change in the status of the Grantee from Employee to
Consultant or from Consultant to Employee.

3

 

          “Date of Grant” means the date on which the Committee makes the determination granting
the Award, or such other later date as is determined by the Committee. Notice of the determination
shall be provided to each Grantee within a reasonable time after the Date of Grant.

          “Date of Termination” means the date on which a Grantee’s Continuous Status as an
Employee or Consultant terminates.

          “Director” means a member of the Board.

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

          “Employee” means any person, including Officers and Directors, employed by the Company
or any Subsidiary. Neither service as a Director nor payment of a director’s fee by the Company
shall be sufficient, of itself, to constitute “employment” by the Company.

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

          “Fair Market Value” means, as of any date, the value of the Common Stock determined as
follows:

               (a) If the Common Stock is listed on any established stock exchange or a national market
system, including without limitation the National Market System of the National Association of
Securities Dealers, Inc. Automated Quotation (“NASDAQ”) System, the Fair Market Value of a Share of
Common Stock shall be the closing sale price for such stock (or the closing bid, if no sales were
reported) as reported on such system or exchange (or if more than one such exchange or system
reports sales of the Common Stock, on the exchange with the greatest volume of trading in the
Common Stock) on the last trading day prior to the date of determination, as reported in The Wall
Street Journal or such other source as the Committee deems reliable;

               (b) If the Common Stock is quoted on the NASDAQ System (but not on the National Market System
thereof) or is regularly quoted by a recognized securities dealer but selling prices are not
reported, the Fair Market Value of a Share of Common Stock shall be the average of the closing bid
and asked prices for the Common Stock on the last trading day prior to the date of determination,
as reported in The Wall Street Journal or such other source as the Committee deems reliable;

               (c) In the absence of an established market for the Common Stock, the Fair Market Value shall
be determined in good faith by the Committee.

          “Grantee” means an individual who has been granted an Award.

          “Incentive Stock Option” means an Option intended to qualify as an incentive stock
option within the meaning of Section 422 of the Code and the regulations promulgated thereunder.

4

 

          “Mature Shares” means Shares for which the holder thereof has good title, free and
clear of all liens and encumbrances, and that such holder either (i) has held for at least six
months or (ii) has purchased on the open market.

          “Nonqualified Stock Option” means an Option not intended to qualify as an Incentive
Stock Option.

          “Officer” means a person who is an officer of the Company within the meaning of
Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.

          “Option” means a stock option granted under the Plan.

          “Performance Period” means the time period during which the performance goals
established by the Committee with respect to a Performance Unit or Performance Share, pursuant to
Section 9 of the Plan, must be met.

          “Performance Share” has the meaning set forth in Section 9 of the Plan.

          “Performance Unit” has the meaning set forth in Section 9 of the Plan.

          “Permitted Holders” means (a) collectively, Lowell W. Paxson, his spouse, children or
other lineal descendants (adoptive or biological), and any revocable or irrevocable inter vivos or
testamentary trust or othe probate estate of any such individual, so long as one or more of the
foregoing individuals is the principal beneficiary of such trust or probate estate; (b) NBCU and
its Affiliates; and (c) the Company, a Subsidiary or a Company employee benefit plan, including any
trustee of such plan acting as trustee.

          “Plan” means this 2006 Stock Incentive Plan.

          “Restricted Stock” means an Award of Shares subject to such terms and conditions as
may be established pursuant to Section 8 of the Plan.

          “Restricted Stock Unit” means an Award granted pursuant to Section 8 of the Plan
consisting of the right to receive Shares subject to and upon satisfaction of such terms and
conditions as may be established by the Committee.

          “Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act or any successor to
Rule 16b-3, as in effect when discretion is being exercised with respect to the Plan.

          “Share” means a share of the Common Stock, as adjusted in accordance with Section 11
of the Plan.

          “Stock Appreciation Right” or “SAR” has the meaning set forth in Section 7 of
the Plan.

          “Stock Award” means an award of Restricted Stock or Restricted Stock Units pursuant

5

 

to Section 8 of the Plan.

          “Subsidiary” means a corporation, domestic or foreign, of which not less than 50
percent of the voting shares are held by the Company or a Subsidiary, whether or not such
corporation now exists or is hereafter organized or acquired by the Company or a Subsidiary.

          “Unvested Shares” means Shares issued upon exercise of an Option which has not vested,
which shall be subject to the provisions of Section 8 and shall otherwise be subject to such terms
and restrictions as shall be established by the Committee.

     3. Stock Subject to the Plan. Subject to the provisions of Section 11 of the Plan and
except as otherwise provided in this Section 3, the maximum aggregate number of Shares that may be
issued under the Plan is 50,000,000. The Shares may be authorized, but unissued, or reacquired
Common Stock.

          If an Award expires, is forfeited or becomes unexercisable without having been exercised in
full, the remaining Shares that were subject to the Award shall become available for future Awards
under the Plan (unless the Plan has terminated). Shares that are forfeited or that are used to
satisfy a withholding obligation under Section 18 shall become available for future Awards under
the Plan. With respect to Stock Appreciation Rights, if the payment upon exercise of a SAR is in
the form of Shares, the Shares subject to the SAR shall be counted against the available Shares as
one Share for every Share subject to the SAR, regardless of the number of Shares used to settle the
SAR upon exercise.

     4. Administration of the Plan.

          (a) Procedure. The Plan shall be administered by the Committee. To the extent the
Board or the Committee considers it desirable for transactions relating to Awards to be eligible to
qualify for an exemption under Rule 16b-3, the transactions contemplated under the Plan shall be
structured to satisfy the requirements for exemption under Rule 16b-3. To the extent the Board or
the Committee considers it desirable for compensation delivered pursuant to Awards to be eligible
to qualify for an exemption from the limit on tax deductibility of compensation under Section
162(m) of the Code, the transactions contemplated under the Plan shall be structured to satisfy the
requirements for exemption under Section 162(m) of the Code.

          (b) Powers of the Committee. Subject to the provisions of the Plan, and subject to
the specific duties delegated by the Board to the Committee, the Committee shall have the
authority, in its sole and absolute discretion:

               (i) to determine the Fair Market Value of the Common Stock, in accordance with Section 2 of
the Plan;

               (ii) to select the Consultants and Employees to whom Awards will be granted under the Plan;

               (iii) to determine whether, when, to what extent and in what types and amounts

6

 

Awards are granted under the Plan;

               (iv) to determine the number of shares of Common Stock to be covered by each Award granted
under the Plan;

               (v) to determine the forms of Award Agreements, which need not be the same for each grant or
for each Grantee, and which may be delivered electronically, for use under the Plan;

               (vi) to determine the terms and conditions, not inconsistent with the terms of the Plan, of
any Award granted under the Plan. Such terms and conditions, which need not be the same for each
grant or for each Grantee, include, but are not limited to, the exercise price, the time or times
when Options and SARs may be exercised (which may be based on performance criteria), the extent to
which vesting is suspended during a leave of absence, any vesting acceleration or waiver of
forfeiture restrictions, and any restriction or limitation regarding any Award or the shares of
Common Stock relating thereto, based in each case on such factors as the Committee shall determine;

               (vii) to construe and interpret the terms of the Plan and Awards;

               (viii) to prescribe, amend and rescind rules and regulations relating to the Plan, including,
without limiting the generality of the foregoing, rules and regulations relating to the operation
and administration of the Plan to accommodate the specific requirements of local and foreign laws
and procedures;

               (ix) to modify or amend each Award (subject to Section 13 of the Plan);

               (x) to authorize any person to execute on behalf of the Company any instrument required to
effect the grant of an Award previously granted by the Committee;

               (xi) to determine the terms and restrictions applicable to Awards;

               (xii) to provide any notice or other communication required or permitted by the Plan in
either written or electronic form; and

               (xiii) to make all other determinations deemed necessary or advisable for administering the
Plan.

          (c) Effect of Committee’s Decision. The Committee’s decisions, determinations and
interpretations shall be final and binding on all Grantees and any other holders of Awards.

     5. Eligibility and General Conditions of Awards.

          (a) Eligibility. Awards other than Incentive Stock Options may be granted to
Employees and Consultants. Incentive Stock Options may be granted only to Employees. If otherwise
eligible, an Employee or Consultant who has been granted an Award may be granted

7

 

additional Awards.

          (b) Maximum Term. The period during which an Award may be outstanding shall not
extend more than ten years after the Date of Grant, and shall be subject to earlier termination as
specified elsewhere in the Plan or Award Agreement; provided, however, that any deferral of a cash
payment or of the delivery of Shares that is permitted or required by the Committee pursuant to
Section 10 of the Plan may, if so permitted or required by the Committee, extend more than ten
years after the Date of Grant of the Award to which the deferral relates.

          (c) Award Agreement. To the extent not set forth in the Plan, the terms and
conditions of each Award, which need not be the same for each grant or for each Grantee, shall be
set forth in an Award Agreement. The Committee, in its sole and absolute discretion, may require
as a condition to any Award Agreement’s effectiveness that the Award Agreement be executed by the
Grantee, including by electronic signature or other electronic indication of acceptance, and that
the Grantee agree to such further terms and conditions as may be specified in the Award Agreement.

          (d) Termination of Employment or Consulting Relationship. If a Grantee’s Continuous
Status as an Employee or Consultant terminates (other than upon the Grantee’s death or Disability),
then, unless otherwise provided by the Award Agreement, and subject to Section 11 of the Plan:

               (i) the Grantee may exercise his or her unexercised Option or SAR, but only within such period
of time as is determined by the Committee, and only to the extent that the Grantee was entitled to
exercise it at the Date of Termination (but in no event later than the expiration of the term of
such Option or SAR as set forth in the Award Agreement). In the case of an Incentive Stock Option,
the Committee shall determine such period of time (in no event to exceed three months from the Date
of Termination) when the Option is granted. If, at the Date of Termination, the Grantee is not
entitled to exercise his or her entire Option or SAR, the unexercisable portion of the Option or
SAR shall terminate and the Shares covered thereby shall be available for new Awards under the
Plan. If, after the Date of Termination, the Grantee does not exercise his or her Option or SAR
within the time period specified by the Committee, the Option or SAR shall terminate, and the
Shares covered by such Option or SAR shall be available for new Awards under the Plan. An Award
Agreement may also provide that if the exercise of an Option following the Date of Termination
would be prohibited at any time because the issuance of Shares would violate Company policy
regarding compliance with Applicable Law, then the exercise period shall terminate on the earlier
of (A) the expiration of the term of the Option set forth in Section 6(b) of the Plan or (B) the
expiration of a period of ten days after the Date of Termination during which the exercise of the
Option would not be in violation of such requirements;

               (ii) the Grantee’s Stock Awards, to the extent forfeitable immediately before the Date of
Termination, shall thereupon automatically be forfeited;

               (iii) the Grantee’s Stock Awards that were not forfeitable immediately before the Date of
Termination shall promptly be settled by delivery to the Grantee of a number of Shares

8

 

equal to the aggregate number of the Grantee’s vested Stock Awards; and

               (iv) any Performance Shares or Performance Units with respect to which the Performance Period
has not ended as of the Date of Termination shall terminate immediately upon the Date of
Termination.

          (e) Disability of Grantee. If a Grantee’s Continuous Status as an Employee or
Consultant terminates as a result of the Grantee’s Disability, then, unless otherwise provided by
the Award Agreement:

               (i) the Grantee may exercise his or her unexercised Option or SAR at any time within 12 months
from the Date of Termination, but only to the extent that the Grantee was entitled to exercise the
Option or SAR at the Date of Termination (but in no event later than the expiration of the term of
the Option or SAR as set forth in the Award Agreement). If, at the Date of Termination, the
Grantee is not entitled to exercise his or her entire Option or SAR, the unexercisable portion of
the Option or SAR shall terminate and the Shares covered thereby shall be available for new Awards
under the Plan. If, after the Date of Termination, the Grantee does not exercise his or her Option
or SAR within the time period specified herein, the Option or SAR shall terminate, and the Shares
covered by such Option or SAR shall be available for new Awards under the Plan.

               (ii) the Grantee’s Stock Awards, to the extent forfeitable immediately before the Date of
Termination, shall thereupon automatically be forfeited;

               (iii) the Grantee’s Stock Awards that were not forfeitable immediately before the Date of
Termination shall promptly be settled by delivery to the Grantee of a number of Shares equal to the
aggregate number of the Grantee’s vested Stock Awards; and

               (iv) any Performance Shares or Performance Units with respect to which the Performance Period
has not ended as of the Date of Termination shall terminate immediately upon the Date of
Termination.

          (f) Death of Grantee. If a Grantee dies, then, unless otherwise provided by the Award
Agreement:

               (i) the Grantee’s unexercised Option or SAR may be exercised at any time within 12 months
following the date of death (but in no event later than the expiration of the term of such Option
or SAR as set forth in the Award Agreement), by the Grantee’s estate or by a person who acquired
the right to exercise the Option or SAR by bequest or inheritance, but only to the extent that the
Grantee was entitled to exercise the Option or SAR at the date of death. If, at the time of death,
the Grantee was not entitled to exercise his or her entire Option or SAR, the unexercisable portion
of the Option or SAR shall terminate and the Shares covered thereby shall be available for new
Awards under the Plan. If, after death, the Grantee’s estate or a person who acquired the right to
exercise the Option or SAR by bequest or inheritance does not exercise the Option or SAR within the
time period specified herein, the Option or SAR shall terminate, and the Shares covered by such
Option or SAR shall be available for new Awards under the Plan.

9

 

               (ii) the Grantee’s Stock Awards, to the extent forfeitable immediately before the date of
death, shall thereupon automatically be forfeited;

               (iii) the Grantee’s Stock Awards that were not forfeitable immediately before the date of
death shall promptly be settled by delivery to the Grantee’s estate or a person who acquired the
right to hold the Stock Grant by bequest or inheritance, of a number of Shares equal to the
aggregate number of the Grantee’s vested Stock Awards; and

               (iv) any Performance Shares or Performance Units with respect to which the Performance Period
has not ended as of the date of death shall terminate immediately upon the date of death.

          (g) Buyout Provisions. Except as otherwise provided in this Section 5(g), the
Committee may at any time offer to buy out, for a payment in cash or Shares, an Award previously
granted, based on such terms and conditions as the Committee shall establish and communicate to the
Grantee at the time that such offer is made. The Committee may condition any such buy out on
receipt of the prior approval or consent of the Company’s stockholders. Any such cash offer made
to an Officer or Director shall comply with the provisions of Rule 16b-3 relating to cash
settlement of stock appreciation rights. This provision is intended only to clarify the powers of
the Committee and shall not in any way be deemed to create any rights on the part of Grantees to
receive buy out offers or payments.

          (h) Nontransferability of Awards.

               (i) Except as provided in Section 5(h)(iii) below, each Award, and each right under any Award,
shall be exercisable only by the Grantee during the Grantee’s lifetime, or, if permissible under
Applicable Law, by the Grantee’s guardian or legal representative.

               (ii) Except as provided in Section 5(h)(iii) below, no Award (prior to the time, if
applicable, Shares are issued in respect of such Award), and no right under any Award, may be
assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by a Grantee
otherwise than by will or the laws of descent and distribution (or in the case of Stock Awards, to
the Company) and any such purported assignment, alienation, pledge, attachment, sale, transfer or
encumbrance shall be void and unenforceable against the Company or any Subsidiary; provided, that
the designation of a beneficiary shall not constitute an assignment, alienation, pledge,
attachment, sale, transfer or encumbrance.

               (iii) To the extent and in the manner permitted by Applicable Law and by the Committee, and
subject to such terms and conditions as may be prescribed by the Committee, a Grantee may transfer
an Award to:

                    (A) a child, stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse,
sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law,
or sister-in-law of the Grantee (including adoptive relationships);

10

 

                    (B) a trust in which persons described in (A) have more than 50 percent of the beneficial
interest;

                    (C) a foundation in which persons described in (A) or the Grantee control the management of
assets; or

                    (D) any other entity in which persons described in (A) or the Grantee own more than 50 percent
of the voting interests;

provided such transfer is not for value. A transfer under a domestic relations order in settlement
of marital property rights and a transfer to an entity in which more than 50 percent of the voting
interests are owned by persons described in (A) above or the Grantee, in exchange for an interest
in such entity, shall not be considered transfers for value.

     6. Options. Each Option shall be designated in the Award Agreement as either an
Incentive Stock Option or a Nonqualified Stock Option.

          (a) Limitations.

               (i) The aggregate Fair Market Value (determined for each Incentive Stock Option at the Date of
Grant) of Shares with respect to which Incentive Stock Options granted under the Plan and under any
other employee stock option plan of the Company or any Subsidiary are exercisable for the first
time by the Grantee during any calendar year, determined in accordance with the provisions of
Section 422 of the Code, may not exceed $100,000. Any Options in excess of such limit that purport
to be Incentive Stock Options shall be treated for all purposes as Nonqualified Options.

               (ii) No Employee shall be granted, in any fiscal year of the Company, Options to purchase more
than 16,000,000 Shares. The limitation described in this Section 6(a)(ii) shall be adjusted
proportionately in connection with any change in the Company’s capitalization as described in
Section 11 of the Plan. If an Option is canceled in the same fiscal year of the Company in which
it was granted (other than in connection with a transaction described in Section 11 of the Plan),
the canceled Option will be counted against the limitation described in this Section 6(a)(ii).

          (b) Term of Option. The term of each Option shall be stated in the Award Agreement;
provided, however, that no Option shall have a term of more than ten years from the Date of Grant.
Moreover, in the case of an Incentive Stock Option granted to a Grantee who, at the time the
Incentive Stock Option is granted, owns stock representing more than 10 percent of the voting power
of all classes of stock of the Company or any Subsidiary, the term of the Incentive Stock Option
shall not be more than five years from the Date of Grant.

          (c) Exercise Price.

               (i) The per share exercise price for the Shares to be issued pursuant to

11

 

exercise of an Option shall be determined by the Committee and in the case of Incentive Stock
Options, shall be no less than 100 percent of the Fair Market Value per Share on the Date of Grant.
In the case of an Incentive Stock Option granted to an Employee who on the Date of Grant owns
stock representing more than 10 percent of the voting power of all classes of stock of the Company
or any Subsidiary, the per Share exercise price shall be no less than 110 percent of the Fair
Market Value per Share on the Date of Grant.

               (ii) Any Option that is (1) granted to a Grantee in connection with the acquisition
(“Acquisition”), however effected, by the Company of another corporation or entity (“Acquired
Entity”) or the assets thereof, (2) associated with an option to purchase shares of stock or other
equity interest of the Acquired Entity or an affiliate thereof (“Acquired Entity Option”) held by
such Grantee immediately prior to such Acquisition, and (3) intended to preserve for the Grantee
the economic value of all or a portion of such Acquired Entity Option, may be granted with such
exercise price as the Committee determines to be necessary to achieve such preservation of economic
value.

               (iii) Any Option that is granted to a Grantee not previously employed by the Company or a
Subsidiary as a material inducement to the Grantee’s commencing employment with the Company or a
Subsidiary may be granted with such exercise price as the Committee determines to be necessary to
provide such material inducement.

          (d) Waiting Period and Exercise Dates. At the time an Option is granted, the
Committee shall fix the period within which the Option may be exercised and shall determine any
conditions that must be satisfied before the Option may be exercised. An Option shall be
exercisable only to the extent that it is vested according to the terms of the Award Agreement.
Notwithstanding the foregoing, the Committee, in its sole discretion may accelerate the vesting of
an Option and may provide that an Option may be exercised for Unvested Shares.

          (e) Form of Consideration. The Committee shall determine the acceptable form of
consideration for exercising an Option, including the method of payment. In the case of an
Incentive Stock Option, the Committee shall determine the acceptable form of consideration at the
time of grant. The acceptable form of consideration may consist of any combination of cash,
certified check, wire transfer or, subject to the approval of the Committee:

               (i) pursuant to rules and procedures approved by the Committee, promissory note;

               (ii) Mature Shares;

               (iii) pursuant to procedures approved by the Committee, (A) through the sale of the Shares
acquired on exercise of the Option through a broker-dealer to whom the Grantee has submitted an
irrevocable notice of exercise and irrevocable instructions to deliver promptly to the Company the
amount of sale or loan proceeds sufficient to pay the exercise price, together with, if requested
by the Company, the amount of federal, state, local or foreign withholding taxes payable by the
Grantee by reason of such exercise, or (B) through simultaneous sale through a broker of Shares
acquired upon exercise; or

12

 

               (iv) such other consideration and method of payment for the issuance of Shares as may be
permitted by Applicable Law.

          (f) Exercise of Option.

               (i) Any Option shall be exercisable according to the terms of the Plan and at such times and
under such conditions as are determined by the Committee and set forth in the Award Agreement. An
Option may not be exercised for a fraction of a Share.

               (ii) An Option shall be deemed exercised when the Company receives (A) written or electronic
notice of exercise (in accordance with the Award Agreement and any action taken by the Committee
pursuant to Section 4(b) of the Plan or otherwise) from the person entitled to exercise the Option,
and (B) full payment for the Shares with respect to which the Option is exercised. Full payment
may consist of any consideration and method of payment authorized by the Committee and permitted by
the Award Agreement and the Plan.

               (iii) Shares issued upon exercise of an Option shall be issued in the name of the Grantee or,
if requested by the Grantee, in the name of the Grantee and his or her spouse. Until the stock
certificate evidencing such Shares is issued (as evidenced by the appropriate entry on the books of
the Company or of a duly authorized transfer agent of the Company), no right to vote or receive
dividends or any other rights as a stockholder shall exist with respect to such Shares,
notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such
stock certificate promptly after the Option is exercised. No adjustment will be made for a
dividend or other right for which the record date is prior to the date the stock certificate is
issued, except as provided in Section 11 of the Plan.

               (iv) Exercising an Option in any manner shall decrease the number of Shares thereafter
available, both for purposes of the Plan and for sale under the Option, by the number of Shares as
to which the Option is exercised.

     7. Stock Appreciation Rights.

          (a) Grant of SARs. Subject to the terms and conditions of the Plan, the Committee may
grant SARs in tandem with an Option or alone and unrelated to an Option. Tandem SARs shall expire
no later than the expiration of the underlying Option.

          (b) Limitation. No Employee shall be granted, in any fiscal year of the Company, SARs
covering more than [3,000,000] Shares. The limitation described in this Section 7(b) shall be
adjusted proportionately in connection with any change in the Company’s capitalization as described
in Section 11 of the Plan. If a SAR is canceled in the same fiscal year of the Company in which it
was granted (other than in connection with a transaction described in Section 11 of the Plan), the
canceled SAR will be counted against the limitation described in this Section 7(b).

          (c) Exercise of SARs. SARs shall be exercised by the delivery of a written or
electronic notice of exercise to the Company (in accordance with the Award Agreement and any

13

 

action taken by the Committee pursuant to Section 4(b) of the Plan or otherwise), setting forth the
number of Shares with respect to which the SAR is to be exercised. Tandem SARs may be exercised:

               (i) with respect to all or part of the Shares subject to the related Option upon the surrender
of the right to exercise the equivalent portion of the related Option;

               (ii) only with respect to the Shares for which its related Option is then exercisable; and

               (iii) only when the Fair Market Value of the Shares subject to the Option exceeds the exercise
price of the Option.

The value of the payment with respect to the tandem SAR may be no more than 100 percent of the
difference between the exercise price of the underlying Option and the Fair Market Value of the
Shares subject to the underlying Option at the time the tandem SAR is exercised.

          (d) Payment of SAR Benefit. Upon exercise of a SAR, the Grantee 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 SAR exercise price by (ii) the number of
Shares with respect to which the SAR is exercised; provided, that the Committee may provide in the
Award Agreement that the benefit payable on exercise of an SAR shall not exceed such percentage of
the Fair Market Value of a Share on the Date of Grant as the Committee shall specify. As
determined by the Committee, the payment upon exercise of an SAR may be in cash, in Shares that
have an aggregate Fair Market Value (as of the date of exercise of the SAR) equal to the amount of
the payment, or in some combination thereof, as set forth in the Award Agreement.

     8. Stock Awards.

          (a) Authorization to Grant Stock Awards. Subject to the terms and conditions of the
Plan, the Committee may grant Restricted Stock and Restricted Stock Units to Employees or
Consultants from time to time. Each Stock Award shall be evidenced by an Award Agreement that
shall set forth the conditions, if any, which will need to be timely satisfied before the grant
will be effective and the conditions, if any, under which the Grantee’s interest in the related
Stock will be forfeited. No more than 8,000,000 Shares may be granted pursuant to Stock Awards to
an individual Grantee in any calendar year.

          (b) Code Section 162(m) Provisions.

               (i) Notwithstanding any other provision of the Plan, if the Committee determines at the time a
Stock Award is granted to a Grantee that such Grantee is, or may be as of the end of the tax year
for which the Company would claim a tax deduction in connection with such Stock Award, a “covered
employee” within the meaning of Section 162(m)(3) of the Code, and to the extent the Committee
considers it desirable for compensation delivered pursuant to such Stock Award to be eligible to
qualify for an exemption from the limit on tax deductibility of compensation under Section 162(m)
of the Code, then the Committee may provide that this

14

 

Section 8(b) is applicable to such Stock Award under such terms as the Committee shall determine.

          (ii) If a Stock Award is subject to this Section 8(b), then the lapsing of restrictions
thereon and the distribution of Shares pursuant thereto, as applicable, shall be subject to
satisfaction of one, or more than one, objective performance targets. The Committee shall
determine the performance targets that will be applied with respect to each Stock Award subject to
this Section 8(b) at the time of grant, but in no event later than 90 days after the commencement
of the period of service to which the performance target(s) relate. The performance criteria
applicable to Stock Awards subject to this Section 8(b) will be one or more of the following
criteria:

	 	•	 	stock price
	 
	 	•	 	market share
	 
	 	•	 	sales
	 
	 	•	 	earnings per share, core earnings per share or variations thereof
	 
	 	•	 	return on equity
	 
	 	•	 	costs
	 
	 	•	 	revenue
	 
	 	•	 	cash to cash cycle
	 
	 	•	 	days payables outstanding
	 
	 	•	 	days sales outstanding
	 
	 	•	 	cash flow or operating cash flow
	 
	 	•	 	operating income or net operating income
	 
	 	•	 	profit before tax or profit after tax
	 
	 	•	 	return on assets
	 
	 	•	 	return on sales
	 
	 	•	 	invested capital
	 
	 	•	 	net operating profit after tax
	 
	 	•	 	return on capital, return on investment and return on invested capital
	 
	 	•	 	market performance
	 
	 	•	 	financial return ratios
	 
	 	•	 	total shareholder return
	 
	 	•	 	earnings
	 
	 	•	 	return on equity or average shareowners’ equity
	 
	 	•	 	total shareowner return
	 
	 	•	 	income or net income
	 
	 	•	 	operating profit or net operating profit
	 
	 	•	 	operating margin and/or gross margin
	 
	 	•	 	return on operating revenue
	 
	 	•	 	economic value added
	 
	 	•	 	overhead or other expense reduction
	 
	 	•	 	growth in shareowner value relative to the moving average of the S&P 500 Index or a
peer group index

15

 

	 	•	 	credit rating
	 
	 	•	 	strategic plan development and implementation
	 
	 	•	 	net cash provided by operating activities.

               (iii) Notwithstanding any contrary provision of the Plan, the Committee may not increase the
number of shares granted pursuant to any Stock Award subject to this Section 8(b), nor may it waive
the achievement of any performance target established pursuant to this Section 8(b).

               (iv) Prior to the payment of any Stock Award subject to this Section 8(b), the Committee shall
certify in writing that the performance target(s) applicable to such Stock Award was met.

               (v) The Committee shall have the power to impose such other restrictions on Stock Awards
subject to this Section 8(b) as it may deem necessary or appropriate to assure that such Stock
Awards satisfy all requirements for “performance-based compensation” within the meaning of Code
section 162(m)(4)(C), the regulations promulgated thereunder, and any successors thereto.

     9. Performance Units and Performance Shares.

          (a) Grant of Performance Units and Performance Shares. Subject to the terms of the
Plan, the Committee may grant Performance Units or Performance Shares to any Employee or Consultant
in such amounts and upon such terms as the Committee shall determine.

          (b) Value/Performance Goals. Each Performance Unit shall have an initial value that
is established by the Committee on the Date 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 goals that, depending upon the extent to which they are met, will determine the number
or value of Performance Units or Performance Shares that will be paid to the Grantee.

          (c) Payment of Performance Units and Performance Shares.

               (i) Subject to the terms of the Plan, after the applicable Performance Period has ended, the
holder of Performance Units or Performance Shares shall be entitled to receive a payment based on
the number and value of Performance Units or Performance Shares earned by the Grantee over the
Performance Period, determined as a function of the extent to which the corresponding performance
goals have been achieved.

               (ii) If a Grantee is promoted, demoted or transferred to a different business unit of the
Company during a Performance Period, then, to the extent the Committee determines appropriate, the
Committee may adjust, change or eliminate the performance goals or the applicable Performance
Period as it deems appropriate in order to make them appropriate and comparable to the initial
performance goals or Performance Period.

          (d) Form and Timing of Payment of Performance Units and Performance Shares.

16

 

Payment of earned Performance Units or Performance Shares shall be made in a lump sum following the
close of the applicable Performance Period. The Committee may pay earned Performance Units or
Performance Shares in cash or in Shares (or in a combination thereof) that have an aggregate Fair
Market Value equal to the value of the earned Performance Units or Performance Shares at the close
of the applicable Performance Period. Such Shares may be granted subject to any restrictions
deemed appropriate by the Committee. The form of payout of such Awards shall be set forth in the
Award Agreement pertaining to the grant of the Award.

     10. Deferral of Receipt of Payment. The Committee may permit or require a Grantee to
defer receipt of the payment of cash or the delivery of Shares that would otherwise be due by
virtue of the exercise of an Option or SAR, the grant of or the lapse or waiver of restrictions
with respect to Stock Awards or the satisfaction of any requirements or goals with respect to
Performance Units or Performance Shares. If any such deferral is required or permitted, the
Committee shall establish rules and procedures for such deferral.

     11. Adjustments Upon Changes in Capitalization or Change of Control.

          (a) Changes in Capitalization. Subject to any required action by the stockholders of
the Company, the number of Shares subject to outstanding Awards, and the number of shares of Common
Stock which have been authorized for issuance under the Plan but as to which no Awards have yet
been granted or which have been returned to the Plan upon cancellation or expiration of an Award,
as well as the price per Share, shall be proportionately adjusted for any increase or decrease in
the number of issued shares of Common Stock resulting from a stock split, reverse stock split,
stock dividend, combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued shares of Common Stock effected without receipt of consideration
by the Company; provided, however, that conversion of any convertible securities of the Company
shall not be deemed to have been “effected without receipt of consideration.” Such adjustment
shall be made by the Board, whose determination in that respect shall be final, binding and
conclusive. Except as expressly provided herein, no issuance by the Company of shares of stock of
any class, or securities convertible into shares of stock of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to, the number or price of Shares subject
to outstanding Awards or that may be issued under the Plan.

          (b) Change in Control. If a Change in Control occurs, the following provisions shall
apply:

               (i) Vesting. Any Award outstanding on the date such Change in Control is determined
to have occurred that is not yet exercisable and vested on such date shall continue to vest in
accordance with its original schedule so long as the Grantee’s Continuous Status as an Employee or
Consultant does not terminate, and:

                    (A) shall become fully exercisable and vested on the first anniversary of the date of such
Change in Control (the “Change in Control Anniversary”) if the Grantee’s Continuous Status as an
Employee or Consultant does not terminate prior to the Change in Control Anniversary;

17

 

                    (B) shall become fully exercisable and vested on the Date of Termination if the Grantee’s
Continuous Status as an Employee or Consultant terminates prior to the Change in Control
Anniversary as a result of termination by the Company without Cause; or

                    (C) shall not become fully exercisable and vested if the Grantee’s Continuous Status as an
Employee or Consultant terminates prior to the Change in Control Anniversary as a result of
termination by the Company for Cause or resignation by the Grantee.

               (ii) Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, to the extent that an Award is outstanding, it will terminate
immediately prior to the consummation of such proposed action. The Board may, in the exercise of
its sole discretion in such instances, declare that any Option or SAR shall terminate as of a date
fixed by the Board and give each Grantee the right to exercise his or her Option or SAR as to all
or any part of the Shares covered thereby, including Shares as to which the Option or SAR would not
otherwise be exercisable.

               (iii) Merger or Asset Sale. Except as otherwise determined by the Board, in its
discretion, prior to the occurrence of a merger of the Company with or into another corporation, or
the sale of substantially all of the assets of the Company, in the event of such a merger or sale
each outstanding Option or SAR shall be assumed or an equivalent option or right shall be
substituted by the successor corporation or a parent or subsidiary of the successor corporation.
In the event that the successor corporation or a parent or subsidiary thereof does not agree to
assume the Option or SAR or to substitute an equivalent option or right, the Committee shall, in
lieu of such assumption or substitution, provide for the Grantee to have the right to exercise the
Option or SAR as to all or a portion of the Shares covered thereby, including Shares as to which it
would not otherwise be exercisable. If the Committee makes an Option or SAR exercisable in lieu of
assumption or substitution in the event of a merger or sale of assets, the Committee shall notify
the Grantee that the Option or SAR shall be fully exercisable for a period of 15 days from the date
of such notice, and the Option or SAR will terminate upon the expiration of such period. For the
purposes of this paragraph, the Option or SAR shall be considered assumed if, following the merger
or sale of assets, the option or right confers the right to purchase, for each Share subject to the
Option or SAR immediately prior to the merger or sale of assets, the consideration (whether stock,
cash, or other securities or property) received in the merger or sale of assets by holders of
Common Stock for each Share held on the effective date of the transaction (and if holders were
offered a choice of consideration, the type of consideration chosen by the holders of a majority of
the outstanding Shares); provided, however, that if such consideration received in the merger or
sale of assets was not solely common stock of the successor corporation or its parent, the
Committee may, with the consent of the successor corporation and the participant, provide for the
consideration to be received upon the exercise of the Option or SAR, for each Share subject to the
Option or SAR, to be solely common stock of the successor corporation or its parent equal in Fair
Market Value to the per Share consideration received by holders of Common Stock in the merger or
sale of assets.

               (iv) Board’s Right to Cash Out Options and SARs. Except as otherwise determined by
the Board, in its discretion, prior to the occurrence of a Change in Control other than the
dissolution or liquidation of the Company, a merger of the Company with or into another

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corporation, or the sale of substantially all of the assets of the Company, in the event of such a
Change in Control, all outstanding Options and SARs, to the extent they are exercisable and vested
(including Options and SARs that shall become exercisable and vested pursuant to Section 11(b)(i)
above), shall be terminated in exchange for a cash payment equal to the Change in Control Price
(reduced by the exercise price applicable to such Options or SARs). These cash proceeds shall be
paid to the Grantee or, in the event of death of an Grantee prior to payment, to the estate of the
Grantee or to a person who acquired the right to exercise the Option or SAR by bequest or
inheritance.

     12. Term of Plan. The Plan shall become effective upon its approval by the
stockholders of the Company in accordance with Delaware law within 12 months after the date the
Plan is adopted by the Board. The Plan shall continue in effect until (a) all Shares that may be
issued under the Plan shall have been issued, or (b) it is sooner terminated by the Board pursuant
to Section 13 hereof, in which case the Plan shall remain in effect thereafter with respect to any
Awards that are then outstanding until such time as all such Awards have been exercised, settled,
forfeited or otherwise terminated, as the case may be. In no event may any Award be granted under
the Plan after June 23, 2016, and in no event may an Incentive Stock Option be granted under the
Plan after April 1, 2016.

     13. Amendment and Termination of the Plan.

          (a) Amendment and Termination. The Board may at any time amend, alter, suspend or
terminate the Plan.

          (b) Stockholder Approval. The Company shall obtain stockholder approval of any Plan
amendment to the extent necessary and desirable to comply with Rule 16b-3 or with Section 422 of
the Code (or any successor rule or statute or other applicable law, rule or regulation, including
the requirements of any exchange or quotation system on which the Common Stock is listed or
quoted). Furthermore, the Company shall obtain stockholder approval of any modification or
amendment of the Plan to the extent that the Board, in its sole and absolute discretion, reasonably
determines, in accordance with the requirements of any exchange or quotation system on which the
Common Stock is listed or quoted, that such modification or amendment constitutes a material
revision or material amendment of the Plan. Such stockholder approval, if required, shall be
obtained in such a manner and to such a degree as is required by applicable law, rule or
regulation.

          (c) Effect of Amendment or Termination. No amendment, alteration, suspension or
termination of the Plan shall impair the rights of any Grantee, unless mutually agreed otherwise
between the Grantee and the Committee, which agreement must be in writing and signed by the Grantee
and the Company.

     14. Conditions Upon Issuance of Shares.

          (a) Legal Compliance. Shares shall not be issued pursuant to an Award unless the
exercise, if applicable, of such Award and the issuance and delivery of such Shares shall comply
with all relevant provisions of law, including, without limitation, the Securities Act of 1933, as

19

 

amended, the Exchange Act, the rules and regulations promulgated thereunder, Applicable Law, and
the requirements of any stock exchange or quotation system upon which the Shares may then be listed
or quoted.

          (b) Investment Representations. As a condition to the exercise of an Award, the
Company may require the person exercising such Award to represent and warrant at the time of any
such exercise that the Shares are being purchased only for investment and without any present
intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a
representation is required.

     15. Liability of Company.

          (a) Inability to Obtain Authority. The inability of the Company to obtain authority
from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to
be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of
any liability in respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained.

          (b) Grants Exceeding Allotted Shares. If the Shares subject to an Award exceed, as of
the date of grant, the number of Shares that may be issued under the Plan without additional
stockholder approval, such Award shall be void with respect to such excess Shares, unless and until
stockholder approval of an amendment sufficiently increasing the number of Shares subject to the
Plan is timely obtained in accordance with Section 13 of the Plan. Any such Awards may be
conditioned upon the receipt of such approval.

     16. Reservation of Shares. The Company, during the term of this Plan, will at all
times reserve and keep available such number of Shares as shall be sufficient to satisfy the
requirements of the Plan.

     17. Rights of Employees and Consultants. Neither the Plan nor any Award shall confer
upon an Grantee any right with respect to continuing the Grantee’s employment or consulting
relationship with the Company, nor shall they interfere in any way with the Grantee’s right or the
Company’s right to terminate such employment or consulting relationship at any time, with or
without cause.

     18. Withholding. The Company shall deduct from all cash distributions under the Plan
any amounts required to be withheld in respect of federal, state, local or foreign taxes. The
Company may condition any issuance or delivery of Shares by it pursuant to an Award upon the
Grantee’s remittance to the Company of an amount sufficient to satisfy any federal, state and local
withholding tax requirements. A Grantee may satisfy this withholding obligation by paying the full
amount of the withholding obligation in cash or check acceptable to the Company or its designee.
The Company may elect, and may permit the Grantee or his or her beneficiary to elect to authorize
the Company, to satisfy tax withholding requirements by refraining from issuing a number of Shares
with respect to an Award, with such Shares being valued for purposes of satisfying withholding
requirements at Fair Market Value on the date such Shares would otherwise have been issued. In
such case the number of Shares to be issued to a Grantee or his

20

 

or her beneficiary in respect of an Award shall be reduced by the number of Shares elected to be
withheld. The Company may revoke any right granted to a Grantee to elect to authorize the Company
to satisfy withholding requirements by refraining from issuing Shares at any time. If the Grantee
fails to pay applicable withholding taxes within the time specified by the Company or its designee,
the Company may, but shall not be required to, elect to reduce the number of Shares that the
Grantee is to receive by the smallest number of whole Shares which, when multiplied by the Fair
Market Value of the common stock on the date on which the amount of tax required to be withheld is
determined, is sufficient to satisfy the amount of the federal, state and local withholding tax
obligations imposed on the Company by reason of the exercise or payment of an Award under the Plan.

     19. Governing Law. The validity, interpretation, and enforcement of the Plan are
governed in all respects by the laws of Delaware and the United States of America.

     20. No Guarantee of Favorable Tax Treatment. Although the Committee intends to
administer the Plan so that Awards will be exempt from, or will comply with, the requirements of
Section 409A of the Code, the Company does not warrant that any Award under the Plan will qualify
for favorable tax treatment under Section 409A of the Code or any other provision of federal,
state, local, or foreign law. The Company shall not be liable to any Grantee or beneficiary for
any tax the Grantee or beneficiary might owe as a result of the grant, holding, vesting, exercise,
or payment of any Award under the Plan.

21

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