Document:

M & F WORLDWIDE, CORP. 

OUTSIDE DIRECTORS DEFERRED COMPENSATION PLAN

AS AMENDED AND RESTATED

	
                        1.
 	
                        NAME. The M & F Worldwide, Corp. Outside Directors Deferred Compensation Plan as previously in effect is hereby amended and restated, except as provided herein (the “Plan”). The principal purpose of the amendment is to clarify the Plan’s operation in compliance with applicable requirements of section 409A of the Internal Revenue Code. Provisions of the amended and restated Plan shall be effective with respect to deferrals under the Plan for periods after 2004.
 

	
                        2.
 	
                        DEFINITIONS. The following definitions shall apply in interpreting the Plan:
 

	
                         
 	
                        a.
 	
                        “Account” shall mean an individual account established by the Company in the name of each Participant containing (i) a number of Stock Units equal to the number of shares of Stock hypothetically purchased with deferred Compensation and dividend equivalents deemed to have been paid on each Stock Unit in such account and (ii) prior to their conversion to such Stock Units, such dividend equivalents and deferred Compensation deemed credited to the Account.
 

	
                         
 	
                        b.
 	
                        “Beneficiary” shall mean such individual or the trustees or trustee of a trust as may be designated by a Participant pursuant to such Participant’s deferral election.
 

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

	
                         
 	
                        d.
 	
                        “Code” shall mean the Internal Revenue Code of 1986, as amended, and the rules and regulations promulgated thereunder.
 

	
                         
 	
                        e.
 	
                        “Company” shall mean M & F Worldwide, Corp., a Delaware corporation.
 

	
                         
 	
                        f.
 	
                        “Compensation” shall mean any retainer fees, meeting fees and any other director fees, payable in the form of cash by the Company as consideration for services as a member of the Board.
 

	
                         
 	
                        g.
 	
                        “Distribution Event” shall have the meaning set forth in Section 5(a).
 

	
                         
 	
                        h.
 	
                        “Election Form” shall have the meaning set forth in Section 3(a).
 

	
                         
 	
                        i.
 	
                        “Fair Market Value” per share as of a particular date shall mean (i) the closing price per share of Stock on a national securities exchange, for the last preceding date on which there was a sale of Stock on such exchange or (ii) if the shares of Stock are then traded on any other over-the-counter market, the average of the closing bid and asked prices for the shares of Stock in such over-the-counter market for the last preceding date on which
 

 

 

there was a sale of Stock in such market or (iii) if the shares of Stock are not then listed on a national securities exchange or traded in an over-the-counter market, such value as the Committee in its discretion may determine.

	
                         
 	
                        j.
 	
                        “New Outside Director” means a Non-Employee Director who (i) was not previously eligible to participate in this Plan and (ii) was not previously eligible to participate (whether as an employee, director or otherwise) in any other nonqualified deferred compensation plan sponsored by the Company or an affiliate, taking into account only nonqualified deferred compensation plans required to be aggregated with this Plan under Code Section 409A.
 

	
                         
 	
                        k.
 	
                        “Non-Employee Director” means a person who (i) is serving as a member of the Board and (ii) is not an officer or employee of the Company.
 

	
                         
 	
                        l.
 	
                        “Participant” shall mean an eligible Non-Employee Director who elects to defer Compensation under the terms of the Plan.
 

	
                         
 	
                        m.
 	
                        “Payment Date” shall have the meaning set forth in Section 5(f).
 

	
                         
 	
                        n.
 	
                        ‘Plan Year” shall mean the calendar year.
 

	
                         
 	
                        o.
 	
                        “Stock” shall mean the Common Stock of the Company, par value $0.01 per share.
 

	
                         
 	
                        p.
 	
                        “Stock Unit” shall mean a bookkeeping unit credited to a Participant’s Account, in accordance with Section 4 below.
 

	
                        3.
 	
                        PARTICIPATION.
 

	
                         
 	
                        a.
 	
                        All Non-Employee Directors are eligible to participate in the Plan. Each Non-Employee Director of the Company receiving Compensation may elect to have all or part of such Compensation otherwise payable to him or her deferred and paid at the time and in the manner prescribed herein. Non-Employee Directors may elect to defer 100%, 50% or 0% of their total Compensation. All deferral elections under the Plan shall be made on an “Election Form,” which means the form set forth on Exhibit A to this Plan or such other form as shall be determined by the Board from time to time. 
 

	
                         
 	
                        b.
 	
                        A Non-Employee Director may elect to defer Compensation payable for a Plan Year by making an election no later than December 31 of the preceding Plan Year.
 

 

 

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                        c.
 	
                        Notwithstanding Section 3(b), for the Plan Year in which a New Outside Director first starts serving on the Board, the New Outside Director shall be permitted to defer Compensation to be earned in such Plan Year if the election is (i) made no more than 30 days after service as a director starts and (ii) pertains only to Compensation earned after the election is made.
 

	
                         
 	
                        d.
 	
                        Any election to defer Compensation communicated to the Company as provided in this Section 3 shall continue in force until the end of the Plan Year for which the Participant made such election. The amount accumulated pursuant to the Plan prior to any notice of election to cease future deferrals will continue to be subject to the provisions of the Plan.
 

	
                        4.
 	
                        METHOD OF DEFERRAL OF COMPENSATION.
 

	
                         
 	
                        a.
 	
                        The Company shall establish an Account on its books in the name of each Participant. The Account shall consist of a number of Stock Units equal to the number of shares of Stock hypothetically purchased with deferred cash Compensation, together with any deferred cash Compensation not yet credited as Stock Units pursuant to Section 4(b) hereof and any cash dividends deemed paid on each Stock Unit in the Account (prior to conversion of such deemed cash dividends to Stock Units pursuant to Section 4(c)). The number of Stock Units hypothetically purchased with deferred Compensation shall be determined in accordance with Section 4(b) hereof.
 

	
                         
 	
                        b.
 	
                        Amounts deferred pursuant to the Plan with respect to a Plan Year shall be credited to each Participant’s Account in the form of Stock Units as of the last business day of each calendar quarter by dividing the amount of all such deferred cash Compensation not previously credited to such Participant’s Account in the form of Stock Units by the Fair Market Value of a share of Stock on such date. Notwithstanding the preceding sentence, amounts deferred pursuant to the Plan for periods prior to May 30, 2007 shall be credited to each Participant’s Account in the form of Stock Units as of the last business day of each month. For the avoidance of doubt, amounts to be credited with respect to the Plan Year ending December 31, 2007 shall be without duplication of deferred amounts already credited to each Participant’s Account prior to May 30,
2007.
 

	
                         
 	
                        c.
 	
                        When cash dividends are declared and paid on the Stock, the Account of each Participant shall be credited with a dividend equivalent credit in an amount equal to the cash which would have been paid if each Stock Unit in such Account, as of the dividend payment date, had been one share of outstanding Stock on the record date for payment of dividends. Any such cash dividend equivalent credit shall be converted once per Plan Year, effective each March 15, into a number of Stock Units equal to the maximum number of whole shares of Stock which could be purchased
 

 

 

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with such accumulated deemed cash balance on the conversion date, based on the fair market value of a share of Stock on such March 15. If installment payments are being made from the Participant’s Account as provided in Section 5 hereunder, such dividend equivalents accruing during the payout period shall not be converted into stock and shall instead be paid in cash on each Payment Date (as defined in Section 5(g)) to the Participant or Beneficiary, as the case may be.

	
                        5.
 	
                        DISTRIBUTION OF DEFERRED COMPENSATION.
 

	
                         
 	
                        a.
 	
                        A Participant’s Account shall be distributed to him or her on or following the occurrence of a “Distribution Event,” as more fully provided herein. For purposes of this Plan, “Distribution Event” shall mean (i) any fixed date elected by the Participant when he makes his deferral election on the Election Form, or if earlier (ii) sixty (60) days after the day on which the Participant’s Board service ends.
 

	
                         
 	
                        b.
 	
                        Distributions from the Participant’s Account may be made either: (i) in a lump sum of Stock or (ii) in cash paid in a lump-sum or (iii) in cash paid in equal annual installments over a period of years (no more than 10). If no specific election as to time and manner of payment is designated on the Election Form payment shall be made in a lump-sum cash payment.
 

	
                         
 	
                        c.
 	
                        If a Participant’s account is to be paid to the Participant in a lump sum, the Company shall pay the balance credited to the Participant’s Account when the Distribution Event occurs. If the Participant’s account is to be distributed to the Participant in installments pursuant to Section 5(d), such installments shall commence on the date provided in Section 5.
 

	
                         
 	
                        d.
 	
                        If the Participant’s service on the Board ceases by reason of the Participant’s death, payments due to the Participant under the Plan will be distributed to the Beneficiaries designated by the Participant in the manner elected by the Participant on the Election Form.
 

	
                         
 	
                        e.
 	
                        If a distribution is to be made in Stock in a lump-sum, the Participant will receive the number of shares of Stock equal to the number of Stock Units held in the Participant’s Account on the date of the applicable Distribution Event. If a distribution is to be made in cash in a lump-sum, the Participant will receive an amount in cash equal to the number of Stock Units held in the Participant’s Account multiplied by the Fair Market Value of a share of Stock on the date of the applicable Distribution Event. If on the applicable Distribution Event, cash dividend equivalents and or deferred Compensation has not yet been converted into Stock Units in accordance with the provisions of the Plan, then such amounts shall be paid in cash as part of the lump sum distribution. 
 

 

 

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                        f.
 	
                        Installment payments of cash shall be made on the last business day of the fiscal year of the Company (each such date, the “Payment Date”) commencing in the year in which the Distribution Event occurs. Unless otherwise determined by the Board, if the Participant elects to receive cash distributions in installments, each installment will equal the value, immediately prior to the Payment Date, of the Stock Units then in the Participant’s Account, divided by the number of remaining installments, plus any dividends that accrued since the last Payment Date but were not yet converted to Stock Units. 
 

	
                         
 	
                        g.
 	
                        For certain Participants, payment may be delayed in order to comply with Code section 409A, as follows:  In the event that payments become due hereunder on account of the Participant’s “separation from service”, and if at the time of such separation the Participant is a “specified employee”, then any payments that would otherwise be due hereunder after such separation from service shall not be paid until the day after the end of the six-month anniversary of such separation from service, and any payments so delayed shall, when paid, be credited as if with interest at an annualized rate of 5%. The foregoing delay provisions are intended to be co-extensive with the requirements of Code Section 409A, and no delay shall be imposed if Code Section 409A does not require such a delay. For these purposes, a “separation from
service” and a “specified employee” shall have the meaning given to them in Code Section 409A.
 

	
                        6.
 	
                        ADMINISTRATION.
 

	
                         
 	
                        a.
 	
                        The Plan shall be administered by the Board. The Board shall have all authority that may be deemed appropriate for administering the Plan, including the discretion and authority to interpret the Plan and to adopt rules and regulations for implementing, amending and carrying out the Plan. The Board may delegate such duties as it determines to a committee of the Board (the “Committee”).
 

	
                         
 	
                        b.
 	
                        Without limiting the generality of Section 6(a), the Board (or the Committee) shall have the discretionary authority (i) to exercise all of the powers granted to it under the Plan, (ii) to prescribe, amend and rescind rules and regulations relating to the Plan, (iii) to make all determinations necessary or advisable in administering the Plan, and (iv) to correct any defect, supply any omission and reconcile any inconsistency in the Plan 
 

	
                         
 	
                        c.
 	
                        All determinations made by the Board (or the Committee) with respect to the Plan shall be conclusive and binding on the Company and its successors, the Participants and their Beneficiaries. No member of the
 

 

 

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Board (or the Committee) shall be liable for any action or determination made in good faith with respect to the Plan.

	
                        7.
 	
                        GENERAL PROVISIONS.
 

	
                         
 	
                        a.
 	
                        The Stock Units allocated to a Participant’s Account may be adjusted, converted or cancelled by the Board, as it deems appropriate, to reflect any reclassification, recapitalization, stock split, dividend or similar distribution (whether in the form of cash, stock or other property) affecting the Stock, combination, merger, consolidation, spin-off, share exchange, repurchase or other similar corporate transaction or event that, in the discretion of the Board, affects the Stock such that an adjustment is appropriate.
 

	
                         
 	
                        b.
 	
                        The right of any Participant to receive future payments under the provisions of the Plan shall be an unsecured general creditor claim against the general assets of the Company, shall confer on Participants no right in any specific property or assets, and shall not constitute a trust or secured arrangement.
 

	
                         
 	
                        c.
 	
                        A Participant may change his or her Beneficiaries at any time by notifying the Board in such form as the Board shall from time to time designate.
 

	
                         
 	
                        d.
 	
                        No Participant or Beneficiary shall have any power to commute, encumber, sell, or otherwise dispose of the rights provided herein, and such rights shall be non-assignable and non-transferable.
 

	
                         
 	
                        e.
 	
                        The Board or the Committee may in its discretion amend the Plan at any time, retroactively if required, to conform the Plan (either in form or operation) to Code Section 409A. Further, the Board or the Committee may in its discretion restructure to the extent possible, any cash payments, or delivery of Stock in order to avoid the application of any accelerated or additional tax under Code Section 409A.
 

	
                        8.
 	
                        TERMINATION OF THE PLAN; AMENDMENT OF THE PLAN.
 

	
                         
 	
                        a.
 	
                        The Plan shall continue in effect until terminated by resolution of the Board.
 

	
                         
 	
                        b.
 	
                        The Plan may be amended from time to time by resolution of the Board; provided, however, that without the consent of affected Participants, no amendment may adversely alter the rights of Participants to amounts credited to their Accounts as of the date of the amendment; provided further, however, that the Plan may be amended as required to comply 
 

 

 

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with applicable law, including section 409A in such manner as the Company deems necessary or desirable.

	
                        9.
 	
                        EFFECTIVE DATE OF THE PLAN.
 

	
                         
 	
                        a.
 	
                        The Plan was adopted by the Board to be effective as of November 5, 2003 (the “Effective Date”). The Plan shall be effective with respect to any Compensation payable to a Non-Employee Director for services rendered after such effective date, provided, that any compensation deferred after 2004 shall be governed by the terms of the Plan as amended and restated.
 

 

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EXHIBIT A

[Insert Name]

[Insert Address]

[Insert Address]

Attention: Secretary

Gentlemen:

Pursuant to the provisions of Section 3 of the M & F Worldwide, Corp. Deferred Compensation Plan for Non-Employee Directors (hereinafter called the “Plan”), I hereby irrevocably elect to have the indicated percentage of my retainer fees, meeting fees and any other director fees which may have become payable to me with respect to calendar year _______ deferred in Stock Units in the manner provided in the Plan:  (Designate percentage to be deferred.)

	
       
 	
      o
 	
  100%
 

	
                         
 	
                        o
 	
                        50%
 

	
                         
 	
                        o
 	
                        0%
 

This direction shall be effective for fees payable to me with respect to calendar year _______.

I elect to have amounts I have deferred distributed to me:

	
                         
 	
                        o
 	
                        60 days after my service on the Board ends 
 

	
                         
 	
                        o
 	
                        ______________________________ (please specify the date which will trigger distribution of payments to you)
 

I elect to receive payments upon distribution in:

	
                         
 	
                        o
 	
                        Stock
 

	
                         
 	
                        o
 	
                        Cash, in a lump sum
 

	
                         
 	
                        o
 	
                        Cash, in annual installments over __ years (must be 10 or fewer).
 

(Each installment will equal the value, immediately prior to the Payment Date, of the Stock Units then in my Account, divided by the number of remaining installments, plus any dividends that accrued since the last Payment Date that have not been deemed converted to Stock Units.)

 

 

 

 

If I die while a director of the Company or prior to receiving of all distributions to which I am entitled under the Plan, I hereby direct that any amounts remaining in my Account be distributed as follows in:

 

	
                        o       Stock to
 	
                         
 	
                         
 	
                         
 
	
                         
 	
                         
 	
                         
 	
                        (Insert Name of Beneficiary)
 
	
                         
 	
                         
 	
                         
 	
                          
 
	
                         
 	
                         
 	
                         
 	
                          
 
	
                         
 	
                         
 	
                         
 	
                        (If more than one Beneficiary is named, indicate percentages to be paid to each Beneficiary)
 

 

 

	
                        o       Cash, in a lump sum to
 	
                         
 	
                         
 	
                         
 
	
                         
 	
                         
 	
                         
 	
                        (Insert Name of Beneficiary)
 
	
                         
 	
                         
 	
                         
 	
                          
 
	
                         
 	
                         
 	
                         
 	
                          
 
	
                         
 	
                         
 	
                         
 	
                        (If more than one Beneficiary is named, indicate percentages to be paid to each Beneficiary)
 

 

	
                        o       Cash, in continued installments as directed by me above
 
	
                         
 	
                         
 	
                         
 	
                          
 
	
                         
 	
                         
 	
                         
 	
                        (Name one Beneficiary only)
 
	
                         
 	
                         
 	
                         
 	
                          
 
	
                         
 	
                         
 	
                         
 	
                        (Signature)
 
	
                        Date:
 	
                         
 	
                         
 	
                         
 

 

 

9M&F WORLDWIDE CORP.

2008 Long Term Incentive Plan

ARTICLE 1. ESTABLISHMENT AND PURPOSE

	
                        1.1
 	
                        Establishment. The M&F Worldwide Corp. 2008 Long Term Incentive Plan is established effective as of January 1, 2008, subject to approval by the Company’s shareholders. Awards may be made under the Plan prior to shareholder approval of the Plan so long as such Awards are subject to such shareholder approval. Awards may be made under the Plan until December 31, 2013, unless the Plan is terminated earlier by the Board. Subject to other applicable provisions of the Plan, all Awards made under the Plan prior to such termination of the Plan shall remain in effect until such Awards have been satisfied or terminated in accordance with the Plan and the terms of such Awards.
 

	
                        1.2
 	
                        Purpose. The purpose of the Plan is to foster and promote the long-term financial success of the Company and increase shareholder value by:  (a) strengthening the Company’s capability to develop and maintain a management team; (b) motivating superior performance by means of long-term performance related incentives linked to business performance of the Company or an Affiliate; (c) attracting and retaining qualified personnel by providing incentive compensation opportunities competitive with other similar companies; and (d) enabling officers and other key employees to participate in the long-term growth and financial success of the Company or an Affiliate.
 

ARTICLE 2. DEFINITIONS

The following Sections of this Article provide terms used in this Plan, and whenever used herein in a capitalized form, the terms shall be deemed to have the meanings set forth in this Article. In addition, certain other terms used in the Plan but not specifically defined in this Article have the definitions given to them in the first place in which they are used.

	
                        2.1
 	
                        “Affiliate” means any corporation, partnership, limited liability company, association, joint-stock company, trust, unincorporated association or other entity (other than the Company) that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with the Company, including the subsidiaries of the Company and other entities controlled by such subsidiaries.
 

	
                        2.2
 	
                        “Award” means a grant under the Plan, based upon criteria specified by the Committee. Awards shall be subject to the terms and conditions of the Plan and shall be evidenced by an Award Agreement containing such additional terms and conditions as the Committee shall deem desirable.
 

	
                        2.3
 	
                        “Award Agreement” means any agreement, letter or other instrument by which an Award is granted to a Participant. 
 

 

 

	
                        2.4
 	
                        “Award Cycle” means any period designated in an Award Agreement as an “Award Cycle.”
 

	
                        2.5
 	
                        “Award Term” means the period designated in an Award Agreement as the “Award Term.”
 

	
                        2.6
 	
                        “Board” means the Board of Directors of the Company.
 

	
                        2.7
 	
                        “Cause” with respect to any Participant, shall have the meaning set forth in any employment agreement between such Participant and the Company or an Affiliate. Absent such term in any such agreement, and in the case of other Participants who do not have such an agreement, “Cause” shall mean the following: (i) continued neglect by the Participant of the Participant’s duties to the Company or its Subsidiaries, (ii) continued incompetence or unsatisfactory attendance, (iii) conviction of any felony, (iv) violation of the rules, regulations, procedures or instructions relating to the conduct of employees, directors, officers and/or consultants of the Company, (v) willful misconduct by the
Participant in connection with the performance of any material portion of the Participant’s duties to the Company or its Subsidiaries, (vi) breach of fiduciary obligation owed to the Company or commission of any act of fraud, embezzlement, disloyalty or defalcation, or usurpation of a Company opportunity, (vii) breach of any provision of an employment agreement or an Award agreement with the Company or its Subsidiaries, including any non-competition, non-solicitation and/or confidentiality provisions, (viii) any act that has a material adverse effect upon the reputation of and/or the public confidence in the Company, (ix) failure to comply with a reasonable order, policy or rule that constitutes material insubordination, (x) engaging in any discriminatory or sexually harassing behavior or (xi) using, possessing or being impaired by or under the influence of illegal drugs or the abuse of controlled substances or alcohol on the premises of the Company or any of its subsidiaries or
affiliates or while working or representing the Company or any of its subsidiaries or affiliates. A termination for Cause by the Company of any of the events described in clauses (i), (ii), (iv), (ix), (x) and (xi) shall only be effective on 15 days advance written notification, providing the Participant the opportunity to cure, if reasonably capable of cure within said 15-day period; provided, however, that no such notification is required if the Cause event is not reasonably capable of cure or the Board determines that its fiduciary obligation requires it to effect a termination of the Participant for Cause immediately.
 

	
                        2.8
 	
                        “Code” means the Internal Revenue Code of 1986, as amended, or any successor thereto.
 

	
                        2.9
 	
                        “Committee” means the Compensation Committee of the Board or other committee authorized by the Board to administer the Plan
 

	
                        2.10
 	
                        “Company” means M&F Worldwide Corp., a Delaware corporation, and includes any successor or assignee corporation or corporations into which the 
 

 

 

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Company may be merged, changed or consolidated, any corporation for whose securities the securities of the Company shall be exchanged, and any assignee of or successor to substantially all of the assets of the Company.

	
                        2.11
 	
                        “Disability” means “Disability” as defined in any existing employment agreement between a Participant and the Company or an Affiliate, or, in the absence of such an employment agreement, a mental or physical illness that entitles the Participant to receive benefits under the long-term disability plan of the Company, or if there is no such plan or the Participant is not covered by such a plan or the Participant is not an employee of the Company, a mental or physical illness that renders a Participant totally and permanently incapable of performing the Participant’s duties for the Company, as determined by the Committee. The determination of Disability for purposes of this Plan shall not be
construed to be an admission of disability for any other purpose.
 

	
                        2.12
 	
                        “EBITDA” means earnings before interest, taxes, depreciations and amortization, or as specified in any Award Agreement.
 

	
                        2.13
 	
                        “Eligible Employee” means an Employee who is employed or serves in a position or capacity designated by the Committee as eligible to participate in the Plan.
 

	
                        2.14
 	
                        “Employee” means any person who is considered to be an employee of the Company or an Affiliate pursuant to its personnel policies.
 

	
                        2.15
 	
                        “Participant” means an Eligible Employee who satisfies the eligibility conditions of the Plan and who has been selected by the Committee for participation in the Plan.
 

	
                        2.16
 	
                        “Payment Value” means the amount designated as the “Payment Value” in an Award Agreement.
 

	
                        2.17
 	
                        “Payout” means the actual amount to be distributed under the Plan to a Participant with respect to the Award Term or an Award Cycle.
 

	
                        2.18
 	
                        “Performance Goals” means the level of performance for the Award Term or Award Cycle, as determined by reference to one or more of the Performance Measures, the attainment of which results in a right (subject to the provisions of the Plan and the Award Agreement) to receive a Payout for the Award Term or an Award Cycle.
 

	
                        2.19
 	
                        “Performance Measures” mean the particular performance measures for the Award Term or an Award Cycle determined in the discretion of the Committee, based upon the Committee’s determination of the goals that will further the Company’s corporate objectives. Performance Measures may (i) be based on performance goals for the Company, any Affiliate or any division of the Company or an Affiliate, (ii) be relative or absolute and (iii) include sales; cash flow; cash flow from operations; operating profit or income; net income; operating margin; 
 

 

 

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net income margin; return on net assets; economic value added; return on total assets; return on common equity; return on total capital; total shareholder return; revenue; revenue growth; EBITDA; EBITDA growth; cumulative EBITDA over a period fixed by the Committee; basic earnings per share; diluted earnings per share; funds from operations per share and per share growth; cash available for distribution; cash available for distribution per share and per share growth; share price performance on an absolute basis and relative to an index of earnings per share or improvements in the Company’s or an Affiliate’s (or any division thereof’s) attainment of expense levels; implementing or completion of critical projects; or other reasonable criteria established by the Committee. Unless otherwise specifically defined in the Plan, the foregoing criteria shall have any
reasonable definitions that the Committee may specify, which may include or exclude any or all of the following items as the Committee may specify:  extraordinary, unusual or non-recurring items; effects of accounting changes; effects of financing activities; expenses for restructuring or productivity initiatives; other non-operating items; spending for acquisitions; effects of divestitures; and effects of litigation activities and settlements.

	
                        2.20
 	
                        “Plan” means the M&F Worldwide Corp. 2008 Long Term Incentive Plan, as herein set forth and as may be amended from time to time.
 

	
                        2.21
 	
                        “Termination of Employment” means the occurrence of any act or event whether pursuant to an employment agreement or otherwise that actually or effectively causes or results in the person’s ceasing, for whatever reason, to be an officer or employee of the Company and its Affiliates, including, without limitation, death, Disability, dismissal, resignation, or separation from employment as a result of the discontinuance, liquidation, sale or transfer by the Company and or any Affiliate of a business such entity owns or operates.
 

ARTICLE 3. ADMINISTRATION

	
                        3.1
 	
                        Committee. The Plan shall be controlled, managed and administered by the Committee, which shall consist of two or more members. Each member of the Committee shall be a “Non-employee Director” as that term is defined by Rule 16b-3 promulgated under the Securities Exchange Act of 1934 (the “Exchange Act”) or any similar rule which may subsequently be in effect (“Rule 16b-3”) and shall be an “outside director” within the meaning of Section 162(m)(4)(C)(i) of the Code and the Treasury Regulations promulgated thereunder. The Committee shall have the discretion to interpret the provisions of the Plan,
and its interpretations and determinations shall be final and binding on all persons, including the Company, all Affiliates and Participants. The Committee may, from time to time, adopt rules or guidelines with respect to the administration of the Plan and the rights granted hereunder which are consistent with the provisions of the Plan and may amend any and all rules or guidelines previously established. No determination or decision of the Committee shall be subject to de novo court review if the procedures of this Article have been followed by the Committee. Subject to the express provisions of the Plan and to 
 

 

 

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the extent not inconsistent with the provisions of Section 162(m) of the Code and the Treasury Regulations promulgated thereunder regarding performance-based compensation, the Committee may, from time to time, delegate or allocate the performance of any part or all its ministerial duties under the Plan as it considers desirable to such person or persons as it may select. All costs of Plan administration will be paid by the Company.

	
                        3.2
 	
                        Powers of Committee. For purposes of the Plan, the Committee’s powers shall include, but not be limited to, the following authority, in addition to all other powers provided by, or necessary to administer, the Plan:
 

	
                         
 	
                        3.2.1
 	
                        to determine the Award Cycle(s), Award Term, Payment Value, Performance Goals, Performance Measures and other criteria for which the Committee has discretion under the Plan;
 

	
                         
 	
                        3.2.2
 	
                        to select or designate, for the Award Term or any Award Cycle, the Eligible Employees (if any) to become Participants under the Plan;
 

	
                         
 	
                        3.2.3
 	
                        to determine the terms and conditions of any Awards granted hereunder and to adjust the terms and conditions of any Award under the provisions of the Plan;
 

	
                         
 	
                        3.2.4
 	
                        to provide for the forms of Award Agreement to be utilized in connection with the Plan;
 

	
                         
 	
                        3.2.5
 	
                        to determine the Payout to a Participant and any other right to compensation under the Plan;
 

	
                         
 	
                        3.2.6
 	
                        to appoint such agents, counsel, accountants, consultants, claims administrator and other persons as may be necessary or appropriate to assist in administering the Plan;
 

	
                         
 	
                        3.2.7
 	
                        to sue or cause suit to be brought in the name of the Plan or the Company;
 

	
                         
 	
                        3.2.8
 	
                        to determine whether and with what effect an individual has incurred a Termination of Employment; 
 

	
                         
 	
                        3.2.9
 	
                        to obtain from Participants such information as is necessary for the proper administration of the Plan; 
 

	
                         
 	
                        3.2.10
 	
                        to execute and file such returns and reports as may be required with respect to the Plan; and 
 

	
                         
 	
                        3.2.11
 	
                        to make any adjustments or modifications permitted under the provisions of the Plan.
 

 

 

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ARTICLE 4. PARTICIPATION, PERFORMANCE MEASURES AND PERFORMANCE GOALS

	
                        4.1
 	
                        Participation. The Committee shall select which Eligible Employees will become Participants in the Plan during any given fiscal year the Plan is in effect. The Committee may consider any factors it deems pertinent in selecting an Eligible Employee as a Participant. Upon the selection of the Participants, the Committee shall provide the notices described in Section 4.6 below. A person will become a Participant only upon returning to the Company a signed, written Award Agreement received from the Committee stating the person is a Participant and providing such additional information the Committee deems relevant, including the Award Term and, if applicable, the Award Cycle(s).
 

	
                        4.2
 	
                        Participation of Newly Hired Employees. Except as provided in the sole discretion of the Committee, an individual must be an Eligible Employee as of the beginning of an Award Term in order to be selected as a Participant. If an individual first becomes an Eligible Employee after the beginning of an Award Term, the Committee may, in its discretion, designate such new Eligible Employee as a Participant. Unless the Committee, in its sole discretion, determines otherwise, all amounts payable under this Plan to such Participant for the Award Term shall be pro-rated with respect to the date he or she first became an Eligible Employee or such later date as designated by the Committee. The Committee may make such adjustments as it deems appropriate in order to effectuate this Section.
 

	
                        4.3
 	
                        Payout Amounts. The Payouts that a Participant is entitled to receive under the Plan for an Award Term or an Award Cycle, upon the achievement of the Performance Goals, will be based upon a pre-determined percentage of the Payment Value. Such percentages will be set forth in an Award Agreement.
 

	
                        4.4
 	
                        Performance Measures. The Committee shall establish one or more Performance Measures for the Award Term or an Award Cycle. It is the intent of the Committee that the Performance Goals and Performance Measures established for the Award Term or an Award Cycle will not change during such period. However, certain circumstances identified at the discretion of the Committee may warrant a modification to the Performance Goals and Performance Measures. These circumstances would include, but not be limited to, unforeseen events such as changes in law, regulations, or rulings; changes in accounting principles or practices; or a merger, acquisition, divestiture or other significant transaction. Participants will be notified of any such modification as soon as practicable. Different Performance Measures and/or Performance
Goals may be awarded to similarly situated Participants, and the Performance Measures and Performance Goals awarded to one Participant shall not have an effect on or in any way limit the Performance Measures and Performance Goals awarded to any other Participant.
 

 

 

6

 

	
                        4.5
 	
                        Performance Goals. For any Performance Measure established by the Committee, the Committee shall establish the levels of the Performance Goals. After establishing the Performance Goals for a Performance Measure, the Committee shall have the discretion, where practicable, to provide that the amounts payable in respect of the Performance Goals shall be prorated if the actual performance for the Award Term is between the Performance Goals established by the Committee.
 

	
                        4.6
 	
                        Notice of Participation. After an Eligible Employee has been designated as a Participant, the Committee shall provide such Participant with an Award Agreement setting forth the Payment Value, the Award Term, the Award Cycle(s) during the Award Term, if any, the Performance Measure(s) and the Performance Goal(s).
 

ARTICLE 5. CALCULATING THE PAYOUT

	
                        5.1
 	
                        General. As soon as practicable following the end of the Award Term or an Award Cycle, as applicable, the Committee shall calculate the Payout to each Participant based upon the actual performance of the Company and the Performance Measure(s), Performance Goal(s) and Payment Values for such period.
 

	
                        5.2
 	
                        The Payout. The actual Payout amount to be distributed with respect to an Award Term or Award Cycle, as applicable, may range over a set of compensation values determined by the Committee, as further described in this Section and in an Award Agreement. The amount payable to a Participant shall not exceed the Maximum Payment applicable to such Participant. If the actual performance during the Award Term or an Award Cycle, as applicable, shall be less than the Performance Goal(s) for any Performance Measure(s), the Payout shall be zero.
 

ARTICLE 6. PAYMENT OF BENEFITS

	
                        6.1
 	
                        Normal Payout. Except as otherwise provided in the Plan or an Award Agreement, and subject to the condition of continued employment with the Company or an Affiliate, as set forth in Section 6.2 below, the Payout to a Participant for the Award Term or an Award Cycle shall be made on or about the date that is two and one-half months following the close of the Award Term or such Award Cycle in the form described in Section 6.5; provided, however, that the Committee may, in its discretion, defer payment until audited financial data is available (but in any event no later than the end of the calendar year after such Award Term or Award Cycle ends) unless
such deferral would cause any such payment to be subject to additional taxes pursuant to Code Section 409A. Except as otherwise provided in the subsequent Sections of this Article 6 or in an Award Agreement, each Participant shall receive a payment equal to the full value of his or her Payout for the Award Term or applicable Award Cycle. Payouts under this Section 6.1 are conditioned upon the Participant’s compliance with any 
 

 

 

7

 

non-compete, non-solicitation and/or confidentiality provision in any written agreement or policy between the Participant and the Company or its subsidiaries and Affiliates. Unless the Committee provides otherwise in writing, upon the date of any violation of any such non-compete, non-solicitation and/or confidentiality provision, the person shall immediately cease to be a Participant, and any amount not yet distributed to such Participant under this Section 6.1 shall immediately and automatically be forfeited, whether or not such violation results in a Termination of Employment with the Company during the Award Term, in addition to any other rights and remedies available to the Company or an Affiliate as set forth in such Participant’s Award Agreement.

	
                        6.2
 	
                        Forfeiture. Unless an applicable Award Agreement provides otherwise, if a Participant initiates a Termination of Employment with the Company for any reason other than for death or due to Disability, or the Participant incurs a Termination of Employment for Cause, unless the Committee provides otherwise in writing, the Participant shall immediately cease to be a Participant, and any amount not yet distributed to such Participant under Section 6.1 shall immediately and automatically be forfeited, whether or not such Termination of Employment occurs before the end of the Award Term.
 

	
                        6.3
 	
                        Disability or Death. Unless an applicable Award Agreement provides otherwise, a Participant’s Termination of Employment with the Company under the circumstances set forth in this Section 6.3 shall not result in the forfeiture of the Participant’s Payout or the right to receive a Payout under the Plan:  Unless an applicable Award Agreement provides otherwise, if the Participant incurs a Termination of Employment with the Company that is the result of the Participant’s death or Disability, then, on the date the Payout would have been made if the Participant had not incurred a Termination of the Employment prior to that date,  the Participant shall receive a payment equal to the Payout multiplied by a fraction, the numerator of which is the number of days from January 1, 2008 through the date on
which the Participant incurred a Termination of Employment and the denominator of which is the number of days in the Award Term or Award Cycle, as applicable.
 

	
                        6.4
 	
                        Form of Payment. Any Payout shall be made in cash in a single lump sum.
 

	
                        6.5
 	
                        Deferral of Payout. If so permitted by the Committee, a Participant may elect to defer receipt of all or a portion of a Payout pursuant to the terms of any deferred compensation plan maintained by the Company or an Affiliate in which such Participant participates or as otherwise permitted by the Committee.
 

ARTICLE 7. AMENDMENT OR TERMINATION

	
                        7.1
 	
                        Amendment or Termination. The Board or the Committee may amend, alter, or terminate the Plan at any time, but no amendment, alteration or termination shall be made which would impair the rights of a Participant under an Award theretofore granted without the Participant’s consent, except such an amendment 
 

 

 

8

 

(a) made to cause the Plan to comply with applicable law (including without limitation, Section 409A of the Code), or (b) made to permit the Company a deduction under applicable tax law. The Committee may amend, alter or discontinue the terms of any Award theretofore granted, prospectively or retroactively, on the same conditions and limitations (and exceptions to limitations) as apply to the Board, and further subject to any approval or limitations the Board may impose.

ARTICLE 8. GENERAL PROVISIONS

	
                        8.1
 	
                        Nonalienation of Plan Benefits. A Participant or beneficiary may not sell, assign, margin, transfer, pledge, encumber, convey, gift, hypothecate or otherwise dispose of any interest in a Payout or the right to receive Payout under this Plan, either voluntarily or involuntarily, except by will, by the laws of descent or distribution, or as set forth in Section 6.3 above.
 

	
                        8.2
 	
                        No Employment Rights. Under no circumstances shall the terms of employment of any Participant be modified or in any way affected by the establishment or continuance of this Plan. The maintenance of this Plan shall not constitute a contract of employment. The Plan will not give any Participant a right to be retained in the employment of the Company or its Affiliates.
 

	
                        8.3
 	
                        No Personal Liability. To the extent permitted by law, no person (including any member of the Committee or any present or former employee of the Company) shall be personally liable for any act done or omitted to be done in good faith in the administration of the Plan.
 

	
                        8.4
 	
                        Final Decisions. Any ruling, regulation, procedure or decision of the Committee shall be conclusive and binding upon all persons affected by this Plan.
 

	
                        8.5
 	
                        Withholding of Taxes. The Company shall deduct from any Payout such amount as the Company, in its sole discretion, deems proper to protect it against liability for the payment of taxes, and out of the money so deducted, the Company may discharge any such liability and pay the amount remaining to the Participant or his or her beneficiary, as the case may be.
 

	
                        8.6
 	
                        Applicable Law. The Plan and all Awards made and actions taken under the Plan shall be governed by and construed in accordance with the laws of the State of Delaware and any applicable subdivision thereof. The Plan shall be construed to comply with all applicable laws and to avoid liability to the Company or a Participant.
 

	
                        8.7
 	
                        Successors. The Plan is binding on all persons entitled to benefits hereunder and their respective heirs and legal representatives, on the Committee and its successor, and on the Company and its successor, whether by way of merger, consolidation, purchase or otherwise.
 

 

 

9

 

	
                        8.8
 	
                        Severability. If any provision of the Plan shall be held illegal or invalid for any reason, such illegality or invalidity shall not affect the remaining provisions of the Plan, and the Plan shall be enforced as if the invalid provisions had never been set forth herein.
 

	
                        8.9
 	
                        Provisions Relating to Code Section 162(m). The Plan and any Award to any Participant who is (or who, in the judgement of the Committee, could reasonably be expected at the time of any payment of the Award to be) a “Covered Employee” (as defined in Section 162(m)(3) of the Code) (any such Participant, an “Applicable Participant”) under the Plan shall be administered, and the provisions of the Plan and each Award Agreement with an Applicable Participant shall be interpreted, in a manner consistent with the requirements of Code Section 162(m) and the Treasury Regulations promulgated thereunder. If any provision of the Plan or
any Agreement relating to an Award to such a Participant does not comply or is inconsistent with the requirements of Code Section 162(m)(4)(c) and the Treasury Regulations promulgated thereunder, such provision shall be construed or deemed amended to the extent necessary to conform to such applicable requirements, if any such construction or deemed amendment can satisfy Code Section 162(m) and the Treasury Regulations promulgated thereunder. In addition, the following provisions shall apply to the Plan or an Award to the extent necessary to avoid the disallowance of a tax deduction for the Company or an Affiliate:
 

	
                         
 	
                        8.9.1
 	
                        Not later than the date required or permitted for “qualified performance-based compensation” under Code Section 162(m) and the Treasury Regulations promulgated thereunder, the Committee shall determine the Participants who are Applicable Participants who will receive Awards that are intended as qualified performance-based compensation and the amount or method for determining the amount of such compensation. Any Award intended to constitute qualified performance-based compensation shall be designated in writing as such by the Committee at the time it is granted.
 

	
                         
 	
                        8.9.2
 	
                        For Awards that are designated as “performance-based compensation” (as that term is used in Code Section 162(m)) in accordance with Section 8.9.1 above, no more than $10,000,000 (the “Maximum Payment”) may be subject to any such Award granted to any Applicable Participant and payable with respect to the Award’s entire Award Term. In the manner required by Code Section 162(m) and the Treasury Regulations promulgated thereunder, the Committee shall, promptly after the date on which the necessary financial and other information for the Award Term or an Award Cycle becomes available, certify the extent to which Performance Goals have been achieved with respect to any Award intended to qualify as “performance-based compensation” under Code
Section 162(m) and the Treasury Regulations promulgated 
 

 

 

10

 

thereunder. In addition, the Committee may, in its discretion, reduce or eliminate the amount of any Award payable to any Participant, based on such factors as the Committee may deem relevant, but the Committee may not increase the amount of any Award payable to any Participant above the amount established in accordance with the relevant Performance Goals with respect to any Award intended to qualify as “performance-based compensation” under Code Section 162(m) and the Treasury Regulations promulgated thereunder.

	
                         
 	
                        8.9.3
 	
                        Notwithstanding any other provision of this Plan to the contrary (including, without limitation, Section 4.5), with respect to any Award granted to an Applicable Participant: (i) the Performance Goals and Performance Measures established for the Award Term or an Award Cycle shall not change during such period but may be adjusted to take into account significant corporate events (including mergers, acquisitions and divestitures), and (ii) the terms of the award shall specify at the time of grant whether amounts payable pursuant to the Award will or will not be prorated if actual performance for the Award Term is between the applicable Performance Goals established by the Committee.
 

	
                        8.10
 	
                        Unsecured Interest. No Participant in the Plan shall have any interest in any fund or specific asset of the Company by reason of the Plan. No trust fund shall be created in connection with the Plan or any Payout thereunder, and there shall be no required funding of amounts, which may become payable to any Participant.
 

	
                        8.11
 	
                        Offset. Any amounts owed to the Company by the Participant of whatever nature may be offset by the Company from the value of any Payout due under this Plan, and no Payout shall be made under this Plan unless and until all disputes between the Company and the Participant have been fully and finally resolved and the Participant has waived all claims to such against the Company.
 

	
                        8.12
 	
                        Indemnification. The officers, directors and employees of the Company, as well as the Committee members, shall be indemnified and held harmless by the Company against and from any and all loss, cost, liability, or expense that may be imposed upon or reasonably incurred by them in connection with or resulting from any claim, action, suit, or proceeding to which they may be a party or in which they may be involved by reason of any action taken or failure to act under this Plan and against and from any and all amounts paid by them in settlement (with the Company’s written approval) or paid by them in satisfaction of a judgement in any such action, suit or proceeding. The foregoing provision shall not be applicable to any person if the loss, cost, liability or expense is due to such person’s gross
negligence or willful misconduct.
 

 

 

11

 

	
                        8.13
 	
                        Obligation.  The Plan shall be sponsored by the Company and administered by the Committee, provided however that the obligation for the payment of the Payout, if any, shall be solely an obligation of Harland Clarke Holdings Corp., (a subsidiary of the Company) and the Company shall not have any obligation for any payment with respect to the Plan.
 

	
                        8.14
 	
                        Headings. The headings contained in this Plan are for reference purposes only and shall not affect the meaning or interpretation of this Plan.
 

	
                        8.15
 	
                        Gender and Number. Words denoting the masculine gender includes the feminine gender, and the singular shall include the plural and the plural shall include the singular wherever required by the context.
 

	
                        8.16
 	
                        Section 409A. This Plan is intended to comply with the rules regarding deferred compensation codified as Section 409A of the Code, and shall be limited, interpreted and construed in a manner consistent with such intent. The Committee can adjust the form and timing of award payments in its sole discretion if it believes such adjustments are necessary or advisable to avoid accelerated or additional tax under Section 409A of the Code. In no event whatsoever shall the Company or any of its Affiliates be liable for any additional tax, interest or penalties that may be imposed on a Participant by Section 409A of the Code or any damages for failing to comply with Section 409A of the Code.
 

 

 

12

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