Document:

Exhibit 4.31

SUPPLEMENT NO. 1 TO THE

SECURITY AGREEMENT (ABL)

SUPPLEMENT
NO. 1 dated as of September 11, 2007, to the Security Agreement dated as
of July 6, 2007 (the “Security Agreement”) among Dollar General
Corporation, a Tennessee corporation (the “Parent Borrower”), each
subsidiary of the Parent Borrower party to the Credit Agreement (as defined
below) (each such subsidiary, a “Subsidiary Borrower” together with the
Parent Borrower, the “Borrowers”) and each subsidiary of the Parent
Borrower that became a party thereto pursuant to Section 8.13 of the
Security Agreement) (each such subsidiary individually a “Subsidiary Grantor”
and, collectively, the “Subsidiary Grantors”; the Subsidiary Grantors,
the Subsidiary Borrowers and the Parent Borrower are referred to collectively
herein as the “Grantors”), and The CIT Group/Business Credit, Inc.  (“CIT”), as collateral agent (in such
capacity, the “Collateral Agent”) under the Credit Agreement referred to
below.

A.            Reference is made to
that certain ABL Credit Agreement, dated as of July 6, 2007 (as the same
may be amended, restated, supplemented or otherwise modified, refinanced or
replaced from time to time, the “Credit Agreement”) among the Parent
Borrower, the Subsidiary Borrowers, the lenders or other financial institutions
or entities from time to time party thereto (the “Lenders”), The CIT
Group/Business Credit, Inc. (“CIT”), as Administrative Agent and
Collateral Agent.

B.            Capitalized terms used herein and
not otherwise defined herein shall have the meanings assigned to such terms in
the Security Agreement.

C.            The Grantors have entered into the
Security Agreement in order to induce the Administrative Agent, the Collateral
Agent, the Letter of Credit Issuer, and the Lenders to enter into the Credit
Agreement and to induce the Lenders to make the Loans to the Borrowers and the
Letter of Credit Issuer to issue Letters of Credit under the Credit Agreement
and to induce one or more Cash Management Banks and Hedge Banks to enter into
Secured Cash Management Agreements and Secured Hedge Agreements with the
Borrowers and/or their respective Subsidiaries.

D.            Section 9.11 of the Credit
Agreement and Section 8.13 of the Security Agreement provide that each
Subsidiary of the Parent Borrower that is required to become a party to the
Security Agreement pursuant to Section 9.11 of the Credit Agreement shall
become a Grantor, with the same force and effect as if originally named as a
Grantor therein, for all purposes of the Security Agreement upon execution and
delivery by such Subsidiary of an instrument in the form of this
Supplement.  Each undersigned Subsidiary
(each a “New Grantor”) is executing this Supplement in accordance with
the requirements of the Security Agreement to become a Subsidiary Grantor or
Subsidiary Borrower under the Security Agreement in order to induce the Lenders
to make additional Loans and the Letter of Credit Issuer to issue Letters of
Credit and as consideration for Loans previously made and Letters of Credit
previously issued.

 

Accordingly,
the Collateral Agent and the New Grantors agree as follows:

SECTION 1.  In accordance with Section 8.13 of the
Security Agreement, each New Grantor by its signature below becomes a Grantor
under the Security Agreement with the same force and effect as if originally
named therein as a Grantor and each New Grantor hereby (a) agrees to all
the terms and provisions of the Security Agreement applicable to it as a
Grantor thereunder and (b) represents and warrants that the
representations and warranties made by it as a Grantor thereunder are true and
correct on and as of the date hereof.  In
furtherance of the foregoing, each New Grantor, as security for the payment and
performance in full of the Obligations, does hereby bargain, sell, convey,
assign, set over, mortgage, pledge, hypothecate and transfer to the Collateral
Agent for the benefit of the Secured Parties, and hereby grants to the
Collateral Agent for the benefit of the Secured Parties, a security interest in
all of the Collateral of such New Grantor, in each case whether now or
hereafter existing or in which it now has or hereafter acquires an
interest.  Each reference to a “Grantor”
in the Security Agreement shall be deemed to include each New Grantor.  The Security Agreement is hereby incorporated
herein by reference.

SECTION 2.  Each New Grantor represents and warrants to
the Collateral Agent and the other Secured Parties that this Supplement has
been duly authorized, executed and delivered by it and constitutes its legal,
valid and binding obligation, enforceable against it in accordance with its
terms, subject to the effects of bankruptcy, insolvency or similar laws
affecting creditors’ rights generally and general equitable principles.

SECTION 3.  This Supplement may be executed by one or
more of the parties to this Supplement on any number of separate counterparts
(including by facsimile or other electronic transmission), and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument.  A set of the copies of this
Supplement signed by all the parties shall be lodged with the Collateral Agent
and the Parent Borrower.  This Supplement
shall become effective as to each New Grantor when the Collateral Agent shall
have received counterparts of this Supplement that, when taken together, bear
the signatures of such New Grantor and the Collateral Agent.

SECTION 4.  Such New Grantor hereby represents and
warrants that set forth on Schedule I hereto is (i) the legal name of such
New Grantor, (ii) the jurisdiction of incorporation or organization of
such New Grantor, (iii) the identity or type of organization or corporate
structure of such New Grantor and (iv) the Federal Taxpayer Identification
Number and organizational number of such New Grantor.

SECTION 5.  Except as expressly supplemented hereby, the
Security Agreement shall remain in full force and effect.

SECTION 6.  THIS
SUPPLEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK.

 

 

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SECTION 7.  Any provision of this Supplement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof and in the Security Agreement, and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.  The parties hereto shall endeavor in good
faith negotiations to replace the invalid, illegal or unenforceable provisions
with valid provisions the economic effect of which comes as close as possible
to that of the invalid, illegal or unenforceable provisions.

SECTION 8.  All notices, requests and demands pursuant
hereto shall be made in accordance with Section 13.2 of the Credit
Agreement.  All communications and
notices hereunder to each New Grantor shall be given to it in care of the
Parent Borrower at the Parent Borrower’s address set forth in Section 13.2
of the Credit Agreement.

 

 

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IN
WITNESS WHEREOF, each New Grantor and the Collateral Agent have duly executed
this Supplement to the Security Agreement as of the day and year first above
written.

	
   

  	
  DC FINANCIAL, LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Dollar General
  Corporation, Sole Member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Wade Smith

  
	
   

  	
   

  	
   

  	
  Wade Smith, Treasurer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  THE CIT GROUP/BUSINESS CREDIT, INC.,

  
	
   

  	
  as Collateral Agent

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Adrian Avalos

  
	
   

  	
   

  	
  Name: Adrian Avalos

  
	
   

  	
   

  	
  Title: Vice President

  

 

 

SCHEDULE
I

TO SUPPLEMENT NO. 1 TO THE

SECURITY AGREEMENT

COLLATERAL

	
  Legal
  Name

  	
   

  	
  Jurisdiction
  of

  Incorporation or

  Organization

  	
   

  	
  Type of

  Organization or

  Corporate

  Structure

  	
   

  	
  Federal
  Taxpayer

  Identification Number and

  Organizational

  Identification Number

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  DC
  Financial, LLC

  	
   

  	
  Tennessee

  	
   

  	
  Member-Managed

  Limited Liability

  Company

  	
   

  	
  N/A
  (Disregarded Entity for

  Tax Purposes—Single-

  Member LLC)Exhibit 10.1

 

2007 STOCK INCENTIVE PLAN

FOR KEY EMPLOYEES OF

DOLLAR GENERAL CORPORATION AND ITS AFFILIATES

 

1.             Purpose of Plan

 

The 2007 Stock Incentive Plan for Key
Employees of Dollar General Corporation and its Affiliates (the “Plan”)
is designed:

 

(a)           to promote the long term
financial interests and growth of Dollar General Corporation (the “Company”)
and its Subsidiaries by attracting and retaining management and other personnel
and key service providers with the training, experience and ability to enable
them to make a substantial contribution to the success of the Company’s
business;

 

(b)           to motivate management
personnel by means of growth-related incentives to achieve long range goals;
and

 

(c)           to further the alignment of
interests of participants with those of the stockholders of the Company through
opportunities for increased stock, or stock-based ownership in the Company.

 

2.             Definitions

 

As used in the Plan, the following words
shall have the following meanings:

 

(a)           “Affiliate” means
with respect to any Person, any entity directly or indirectly controlling,
controlled by or under common control with such Person.

 

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

 

(c)           “Change in Control”
means, in one or a series of related transactions, (i) the sale of all or
substantially all of the assets of Buck Holdings, L.P. or the Company and its
subsidiaries to any person (or group of persons acting in concert), other than
to (x) investment funds affiliated with Kohlberg Kravis Roberts &
Co. L.P. (together the “Sponsor”) or its Affiliates or (y) any
employee benefit plan (or trust forming a part thereof) maintained by the
Company, the Sponsor or their respective Affiliates or other person of which a
majority of its voting power or other equity securities is owned, directly or
indirectly, by the Company, the Sponsor or their respective Affiliates; or (ii) a
merger, recapitalization or other sale by the Company, the Sponsor (indirectly)
or any of their respective Affiliates, to a person (or group of persons acting
in concert) of Common Stock or other voting securities of the Company that
results in more than 50% of the Common Stock or other voting securities of the
Company (or any resulting company after a merger) being held, directly or
indirectly,  by a person (or group of
persons acting in concert) that is not Controlled by (x) the Sponsor or
its Affiliates or (y) an employee benefit plan (or trust forming a part
thereof) maintained by the Company, the Sponsor or their respective Affiliates
or other person of which a majority of its voting power or other equity
securities is owned, directly or indirectly, by the Company, the Sponsor or
their respective Affiliates; in any event, which results in the 

 

 

Sponsor and its Affiliates or such employee
benefit plan ceasing to hold the ability to elect (or cause to be elected) a
majority of the members of the Board.

 

For purposes of this definition, “controlled by” means with
respect to the relationship between or among two or more Persons, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the affairs or management of a Person, whether through the
ownership of voting securities, by contract or otherwise, including the
ownership, directly or indirectly, of securities having the power to elect a
majority of the board of directors or similar body governing the affairs of
such Person.

 

(d)           “Code” means the
United States Internal Revenue Code of 1986, as amended.

 

(e)           “Committee” means the
Compensation Committee of the Board (or, if no such committee is appointed, the
Board).

 

(f)            “Common Stock” or “Share”
means the common stock, par value $0.01 per share, of the Company, which may be
authorized but unissued, or issued and reacquired.

 

(g)           “Employee” means a
person, including an officer, in the regular employment of the Company or any
other Service Recipient who, in the opinion of the Committee, is, or is
expected to have involvement in the management, growth or protection of some
part or all of the business of the Company or any other Service Recipient.

 

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

 

(i)            “Fair Market Value”
means, on a per Share basis, the fair market value of the Common Stock on any
given date, as determined reasonably and in good faith by the Board, which
shall not take into account any minority interest discount or discount for the
imposition of transfer restrictions.

 

(j)            “Grant” means an
award made to a Participant pursuant to the Plan and described in Section 5,
including, without limitation, an award of a Stock Option, Stock Appreciation
Right, Other Stock-Based Award or Dividend Equivalent Right (as such terms are
defined in Section 5), or any combination of the foregoing.

 

(k)           “Grant Agreement”
means an agreement between the Company and a Participant that sets forth the
terms, conditions and limitations applicable to a Grant.

 

(l)            “Group” means “group,”
as such term is used for purposes of Section 13(d) or 14(d) of
the Exchange Act.

 

(m)          “Management Stockholder’s
Agreement” shall mean that certain Management Stockholder’s
Agreement between the applicable Participant and the Company.

 

(n)           “Participant” means
an Employee, non-employee member of the Board, consultant or other person
having a service relationship with the Company or any other Service Recipient,
to whom one or more Grants have been made and remain outstanding.

 

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(o)           “Person” means “person,”
as such term is used for purposes of Section 13(d) or 14(d) of
the Exchange Act.

 

(p)           “Public Offering” means any registered public
offering of the Common Stock on the New York Stock Exchange or the Nasdaq
National Market or other nationally recognized stock exchange or listing
system.

 

(q)           “Sale Participation
Agreement” shall mean that certain Sale Participation Agreement between the
applicable Participant and Buck Holdings, L.P.

 

(r)            “Service Recipient”
shall mean, the Company, any Subsidiary of the Company, or any Affiliate of the
Company that satisfies the definition of “service recipient” within the meaning
of Proposed Treasury Regulation Section 1.409A-1(g) (or any successor
regulation), with respect to which the person is a “service provider” (within
the meaning of Proposed Treasury Regulation Section 1.409A-1(f) (or
any successor regulation).

 

(s)           “Subsidiary” means
any corporation or other entity in an unbroken chain of corporations or other
entities beginning with the Company if each of the corporations or other
entities, or group of commonly controlled corporations or other entities, other
than the last corporation or other entity in the unbroken chain then owns stock
or other equity interests possessing 50% or more of the total combined voting
power of all classes of stock or other equity interests in one of the other corporations
or other entities in such chain.

 

3.             Administration of Plan

 

(a)           The Plan shall be
administered by the Committee.  The
Committee may adopt its own rules of procedure, and action of a majority
of the members of the Committee taken at a meeting, or action taken without a
meeting by unanimous written consent, shall constitute action by the
Committee.  The Committee shall have the
power and authority to administer, construe and interpret the Plan, to make rules for
carrying it out and to make changes in such rules.  Any such interpretations, rules, and
administration shall be consistent with the basic purposes of the Plan.

 

(b)           The Committee may delegate
to the Chief Executive Officer and to other senior officers of the Company its
duties under the Plan, subject to applicable law and such conditions and
limitations as the Committee shall prescribe, except that only the Committee
may designate and make Grants to Participants.

 

(c)           The Committee may employ
counsel, consultants, accountants, appraisers, brokers or other persons.  The Committee, the Company, and the officers
and directors of the Company shall be entitled to rely upon the advice,
opinions or valuations of any such persons. 
All actions taken and all interpretations and determinations made by the
Committee in good faith shall be final and binding upon all Participants, the
Company and all other interested persons. 
No member of the Committee, nor employee or representative of the
Company shall be personally liable for any action, determination or
interpretation made in good faith with respect to the Plan or the Grants, and
all such members of the Committee, employees and representatives shall be fully
protected and indemnified to the greatest extent permitted by applicable law by
the Company with respect to any such action, determination or interpretation.

 

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4.             Eligibility

 

The Committee may from time to time make
Grants under the Plan to such Employees, or other persons having a relationship
with Company or any other Service Recipient, and in such form and having such
terms, conditions and limitations as the Committee may determine.  The terms, conditions and limitations of each
Grant under the Plan shall be set forth in a Grant Agreement, in a form
approved by the Committee, consistent, however, with the terms of the Plan; provided,
however, that such Grant Agreement shall contain provisions dealing with
the treatment of Grants in the event of the termination of employment or other
service relationship, death or disability of a Participant, and may also
include provisions concerning the treatment of Grants in the event of a Change
in Control.

 

5.             Grants

 

From time to time, the Committee will
determine the forms and amounts of Grants for Participants.  Such Grants may take the following forms in
the Committee’s sole discretion:

 

(a)           Stock Options - These are
options to purchase Common Stock (“Stock Options”).  At the time of Grant the Committee shall
determine, and shall include in the Grant Agreement, the option exercise
period, the option exercise price, vesting requirements, and such other terms,
conditions or restrictions on the grant or exercise of the option as the
Committee deems appropriate including, without limitation, the right to receive
dividend equivalent payments on vested options. 
Notwithstanding the foregoing, the exercise price per Share of a Stock
Option shall in no event be less than the Fair Market Value on the date the
Stock Option is granted (subject to later adjustment pursuant to Section 8
hereof).  In addition to other
restrictions contained in the Plan, a Stock Option granted under this Section 5(a) may
not be exercised more than 10 years after the date it is granted.  Payment of the Stock Option exercise price
shall be made (i) in cash, (ii) with the consent of the Committee, in
Shares (any such Shares valued at Fair Market Value on the date of exercise)
that the Participant has held for at least six months (or such other period of
time as may be required by the Company’s accountants), (iii) through the
withholding of Shares (any such Shares valued at Fair Market Value on the date
of exercise) otherwise issuable upon the exercise of the Stock Option in a
manner that is compliant with applicable law, or (iv) a combination of the
foregoing methods, in each such case in accordance with the terms of the Plan,
the Grant Agreement and of any applicable guidelines of the Committee in effect
at the time.

 

(b)           Stock Appreciation Rights - The
Committee may grant “Stock Appreciation Rights” (as hereinafter defined)
independent of, or in connection with, the grant of a Stock Option or a portion
thereof.  Each Stock Appreciation Right
shall be subject to such other terms as the Committee may determine.  The exercise price per Share of a Stock
Appreciation Right shall in no event be less than the Fair Market Value on the
date the Stock Appreciation Right is granted. 
Each “Stock Appreciation Right” granted independent of a Stock Option
shall be defined as a right of a Participant, upon exercise of such Stock
Appreciation Right, to receive an amount equal to the product of (i) the
excess of (A) the Fair Market Value on the exercise date of one Share over
(B) the exercise price per Share of such Stock Appreciation Right,
multiplied by (ii) the number of Shares covered by the Stock Appreciation
Right.  Payment of the Stock Appreciation
Right shall be made in Shares or in cash, or partly in Shares and partly in
cash (any such Shares valued at the Fair Market Value on the date of the
payment), all as shall be determined by the Committee.

 

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(c)           Other
Stock-Based Awards - The
Committee may grant or sell awards of Shares, awards of restricted Shares and
awards that are valued in whole or in part by reference to, or are otherwise
based on the Fair Market Value of, Shares (including, without limitation,
restricted stock units).  Such “Other
Stock-Based Awards” shall be in such form, and dependent on such conditions, as
the Committee may determine, including, without limitation, the right to
receive, or vest with respect to, one or more Shares (or the equivalent cash
value of such Shares) upon the completion of a specified period of service, the
occurrence of an event and/or the attainment of performance objectives.  Other Stock-Based Awards may be granted alone
or in addition to any other Grants under the Plan.  Subject to the provisions of the Plan, the
Committee shall determine to whom and when Other Stock-Based Awards will be
made, the number of Shares to be awarded under (or otherwise related to) such
Other Stock-Based Awards; whether such Other Stock-Based Awards shall be
settled in cash, Shares or a combination of cash and Shares; and all other
terms and conditions of such awards (including, without limitation, the vesting
provisions thereof and provisions ensuring that all Shares so awarded and
issued shall be fully paid and non-assessable).

 

(d)           Dividend Equivalent Rights – The
Committee may grant Dividend Equivalent Rights either alone or in connection with
the grant of a Stock Option or SAR.  A “Dividend
Equivalent Right” shall be the right to receive a payment in respect of one
Share (whether or not subject to a Stock Option) equal to the amount of any
dividend paid in respect of one Share held by a shareholder in the
Company.  Each Dividend Equivalent Right
shall be subject to such terms as the Committee may determine.

 

6.             Limitations and Conditions

 

(a)           The number of Shares
available for Grants under this Plan shall be  24
million  subject to adjustment as provided for
in Sections 8 and 9, unless restricted by applicable law.  Shares related to Grants that are forfeited,
terminated, canceled, expire unexercised, withheld to satisfy tax withholding
obligations, or are repurchased by the Company shall immediately become
available for new Grants.

 

(b)           No Grants shall be made
under the Plan beyond ten years after July 6, 2007, the effective date of
the Plan (the “Effective Date”), but the terms of Grants made on or before the
expiration of the Plan may extend beyond such expiration.  At the time a Grant is made or amended in
accordance with the terms of the Plan, or the terms or conditions of a Grant
are changed in accordance with the terms of the Plan or the Grant Agreement,
the Committee may provide for limitations or conditions on such Grant.

 

(c)           Nothing contained herein
shall affect the right of the Company or any other Service Recipient to
terminate any Participant’s employment or other service relationship at any
time or for any reason.

 

(d)           Other than as specifically
provided in the Management Stockholder’s Agreement or Sale Participation
Agreement, no benefit under the Plan shall be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, or
charge, and any attempt to do so shall be void. 
No such benefit shall, prior to receipt thereof by the Participant, be
in any manner liable for or subject to the debts, contracts, liabilities,
engagements, or torts of the Participant.

 

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(e)           Participants shall not be,
and shall not have any of the rights or privileges of, stockholders of the
Company in respect of any Shares purchasable in connection with any Grant
unless and until certificates representing any such Shares have been issued by
the Company to such Participants (or book entry representing such Shares has
been made and such Shares have been deposited with the appropriate registered
book-entry custodian).

 

(f)            No election as to benefits
or exercise of any Grant may be made during a Participant’s lifetime by anyone
other than the Participant except by a legal representative appointed for or by
the Participant.

 

(g)           Absent express provisions to
the contrary, any Grant under this Plan shall not be deemed compensation for purposes
of computing benefits or contributions under any retirement or  severance plan of the Company or other Service Recipient
and shall not affect any benefits under any other benefit plan of any kind now
or subsequently in effect under which the availability or amount of benefits is
related to level of compensation.  This
Plan is not a “Retirement Plan” or “Welfare Plan” under the Employee Retirement
Income Security Act of 1974, as amended.

 

(h)           Unless the Committee
determines otherwise, no benefit or promise under the Plan shall be secured by
any specific assets of the Company or any other Service Recipient, nor shall
any assets of the Company or any other Service Recipient be designated as
attributable or allocated to the satisfaction of the Company’s obligations
under the Plan.

 

7.             Transfers and Leaves of
Absence

 

For purposes of the Plan, unless the
Committee determines otherwise: (a) a transfer of a Participant’s
employment without an intervening period of separation among the Company and
any other Service Recipient shall not be deemed a termination of employment,
and (b) a Participant who is granted in writing a leave of absence or who
is entitled to a statutory leave of absence shall be deemed to have remained in
the employ of the Company (and other Service Recipient) during such leave of
absence.

 

8.             Adjustments

 

In
the event of any stock split, spin-off, share combination, reclassification,
recapitalization, liquidation, dissolution, reorganization, merger, Change in
Control, payment of a dividend (other than a cash dividend paid as part of a
regular dividend program) or other similar transaction or occurrence which
affects the equity securities of the Company or the value thereof, the
Committee shall (i) adjust the number and kind of shares subject to the
Plan and available for or covered by Grants, (ii) adjust the share prices
related to outstanding Grants, and/or (iii) take such other action
(including, without limitation providing for payment of a cash amount to
holders of outstanding Grants), in each case as it deems reasonably necessary
to address, on an equitable basis, the effect of the applicable corporate event
on the Plan and any outstanding Grants, without adverse tax consequences under Section 409A
of the Code.  Any such adjustment made or
action taken by the Committee in accordance with the preceding sentence shall
be final and binding upon holders of Options and upon the Company.

 

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9.             Change in Control

 

In the event of a Change in Control: (a) if
determined by the Committee in the applicable Grant Agreement or otherwise
determined by the Committee in its sole discretion, any outstanding Grants then
held by Participants which are unexercisable or otherwise unvested or subject
to lapse restrictions may automatically be deemed exercisable or otherwise
vested or no longer subject to lapse restrictions, as the case may be, as of
immediately prior to such Change in Control and (b) the Committee may, to
the extent determined by the Committee to be permitted under Section 409A
of the Code, but shall not be obligated to: (i) cancel such awards for
fair value (as determined in the sole discretion of the Committee) which, in
the case of Stock Options and Stock Appreciation Rights, may equal the excess,
if any, of the value of the consideration to be paid in the Change in Control
transaction to holders of the same number of Shares subject to such Stock
Options or Stock Appreciation Rights (or, if no consideration is paid in any
such transaction, the Fair Market Value of the Shares subject to such Stock
Options or Stock Appreciation Rights) over the aggregate option price of such
Stock Options or the aggregate exercise price of such Stock Appreciation
Rights, as the case may be; (ii) provide for the issuance of substitute
awards that will substantially preserve the otherwise applicable terms of any
affected Grants previously granted hereunder, as determined by the Committee in
its sole discretion; or (iii) provide that for a period of at least ten
business days prior to the Change in Control, any Stock Options or Stock
Appreciation Rights shall be exercisable as to all Shares subject thereto and
that upon the occurrence of the Change in Control, such Stock Options or Stock
Appreciation Rights shall terminate and be of no further force and effect.

 

10.           Amendment and Termination

 

(a)           The Committee shall have the authority to make such
amendments to any terms and conditions applicable to outstanding Grants as are
consistent with this Plan, provided that no such action shall modify any
Grant in a manner that adversely impacts, other than in a de minimis
manner, a Participant with respect to any outstanding Grants, other than
pursuant to Section 8, 9 or 10(c) hereof, without the Participant’s
consent, except as such modification is provided for or contemplated in the
terms of the Grant or this Plan.

 

(b)           The Board may amend, suspend or terminate the Plan, except
that no such action, other than an action under Section 8, 9 or 10(c) hereof,
may be taken which would, without stockholder approval, increase the aggregate
number of Shares available for Grants under the Plan, decrease the price of
outstanding Grants, change the requirements relating to the Committee, extend
the term of the Plan.  However, no such
action shall adversely impacts, other than in a de minimis
manner, a Participant with respect to any outstanding Grants, other than
pursuant to Section 8, 9 or 10(c) hereof, without the Participant’s
consent, except as otherwise contemplated in the terms of the Grant or the
Plan.

 

(c)           This Plan is intended to comply with Section 409A
of the Code and will be interpreted in a manner intended to comply with Section 409A
of the Code.  Notwithstanding anything
herein to the contrary, (i) if at the time of the Participant’s
termination of employment with any Service Recipient the Participant is a “specified
employee” as defined in Section 409A of the Code, and the deferral of the
commencement of any payments or benefits otherwise payable hereunder as a
result of such termination of service is necessary in order to prevent the
imposition 

 

7

 

of any accelerated or additional tax under Section 409A of the
Code, then the Company will defer the commencement of the payment of any such
payments or benefits hereunder (without any reduction in such payments or
benefits ultimately paid or provided to the Participant) until the date that is
six months and one day following the Participant’s termination of employment
with all Service Recipients (or the earliest date as is permitted under Section 409A
of the Code), if such payment or benefit is payable upon a termination of
employment and (ii) if any other payments of money or other benefits due
to the Participant hereunder would cause the application of an accelerated or
additional tax under Section 409A of the Code, such payments or other
benefits shall be deferred, if deferral will make such payment or other
benefits compliant under Section 409A of the Code, or otherwise such
payment or other benefits shall be restructured, to the extent possible, in a
manner, reasonably determined by the Board in consultation with the
Participant, that does not cause such an accelerated or additional tax or
result in an additional cost to the Company (without any reduction in such
payments or benefits ultimately paid or provided to the Participant).

 

11.           Governing Law; International
Participants

 

(a)           This Plan shall be governed
by and construed in accordance with the laws of the State of Delaware
applicable therein.

 

(b)           With respect to Participants
who reside or work outside the United States of America, the Committee may, in
its sole discretion, amend the terms of the Plan or awards with respect to such
Participants in order to conform such terms with the requirements of local law
or to obtain more favorable tax or other treatment for a Participant, the
Company or any other Service Recipient.

 

12.           Withholding Taxes

 

The Company shall have the right to deduct
from any payment made under the Plan any federal, state or local income or
other taxes required by law to be withheld with respect to such payment.  It shall be a condition to the obligation of
the Company to deliver Shares upon the exercise of a Stock Option that the
Participant pays to the Company such amount as may be requested by the Company
for the purpose of satisfying any liability for such withholding taxes.

 

13.           Effective Date and
Termination Dates

 

The
Plan shall be effective on July 6, 2007 and shall terminate ten years
later, subject to earlier termination by the Board pursuant to Section 10.

 

8

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