Document:

EX-10.1

Exhibit 10.1

EXECUTION COPY

          SECOND AMENDMENT, dated as of May 12, 2009 (this “Second Amendment”), to the Amended
and Restated Credit Agreement, dated as of January 12, 2009 (as amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among Liz Claiborne, Inc., Mexx Europe
B.V., Liz Claiborne Canada Inc., the other Loan Parties from time to time party thereto, the
Lenders party thereto, JPMorgan Chase Bank, N.A., as Administrative Agent and US Collateral Agent,
J.P. Morgan Europe Limited, as European Administrative Agent and European Collateral Agent,
JPMorgan Chase Bank, N.A., Toronto Branch, as Canadian Administrative Agent and Canadian Collateral
Agent, Bank of America, N.A. and SunTrust Bank, as Syndication Agents, and Wachovia Bank, National
Association, as Documentation Agent.

W I T N
E S S E T H :

          WHEREAS, the Borrowers, the Lenders, the Syndication Agents, the Documentation Agent, the
Administrative Agent, the European Administrative Agent and the Canadian Administrative Agent are
parties to the Credit Agreement;

          WHEREAS, the Borrowers have requested certain amendments to the Credit Agreement as set forth
herein; and

          WHEREAS, the Lenders have consented to the requested amendments as set forth herein;

          NOW, THEREFORE, in consideration of the premises contained herein, the parties hereto agree as
follows:

     1. Defined Terms. Unless otherwise defined herein, capitalized terms used herein
which are defined in the Credit Agreement are used herein as therein defined.

     2. Amendments to Section 1.01 (Defined Terms). (a) Section 1.01 of the Credit
Agreement is hereby amended by inserting in alphabetical order the following new definitions:

          “Increased Reporting Period” means the period commencing on May 16, 2009 and ending
July 31, 2010.

          “Required Availability Amount” means $90,000,000 (or, on any date (x) on or after
October 4, 2009 and prior to December 6, 2009, $75,000,000 and (y) on or after December 15, 2009
and prior to January 30, 2010, $120,000,000). 

          “Second Amendment” means the Second Amendment, dated as of May 12, 2009, to this
Agreement.

          “Second Amendment Effective Date” has the meaning assigned to such term in the Second
Amendment.

 

 

          (b) The definition of “Adjusted LIBO Rate” in Section 1.01 of the Credit Agreement is hereby
amended by deleting the definition contained therein in its entirety and substituting in lieu
thereof the following new definition:

          “Adjusted LIBO Rate” means, with respect to any Eurocurrency Borrowing for any
Interest Period, an interest rate per annum equal to the greater of (1) (a) (i) the LIBO Rate for
such Interest Period multiplied (if applicable) by (ii) the Statutory Reserve Rate,
plus (b) the Mandatory Cost (in each case, rounded upwards, if necessary, to the next 1/16
of 1%) and (2) 1.50%.

          (c) The definition of “Applicable Spread” in Section 1.01 of the Credit Agreement is hereby
amended by (i) deleting the words “Category 4” contained therein and inserting in lieu thereof the
words “Category 2”, (ii) deleting the words “Category 3” contained therein and inserting in lieu
thereof the words “Category 1” and (iii) deleting the pricing grid contained therein and
substituting in lieu thereof the following new pricing grid:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Canadian	 	 	 	 	 	Overnight
	Average Aggregate	 	ABR	 	Eurocurrency	 	Prime	 	Acceptance	 	LIBO
	Availability	 	Spread	 	Spread	 	Spread	 	Fee	 	Spread
	Category 1
>$150,000,000
	 	 	5.00	%	 	 	5.00	%	 	 	5.00	%	 	 	5.00	%	 	 	5.00	%
	Category 2
≤ $150,000,000
	 	 	5.25	%	 	 	5.25	%	 	 	5.25	%	 	 	5.25	%	 	 	5.25	%

          (d) The definition of “Fixed Charges” in Section 1.01 of the Credit Agreement is hereby
amended by adding the words “(net of any income tax refund received, but in no event less than
zero)” immediately following the words “plus income taxes paid in cash” in the second line
thereof;

          (e) The definition of “Full Cash Dominion Period” in Section 1.01 of the Credit Agreement is
hereby amended by deleting the definition contained therein in its entirety and substituting in
lieu thereof the following new definition:

          “Full Cash Dominion Period” means (i) at any time prior to the Second Amendment
Effective Date, any Level 1 Minimum Aggregate Availability Period (provided that a Full
Cash Dominion Period may be discontinued no more than twice in any period of twelve consecutive
months) and (ii) any period commencing on or after the Second Amendment Effective Date.

     3. Amendment to Section 5.01 (Financial Statements; Borrowing Base and Other
Information). (a) Clause (g) of Section 5.01 of the Credit Agreement is hereby amended by
inserting the words “or during the Increased Reporting Period” immediately following the words
“Level 1 Minimum Aggregate Availability Period” in the fourth line thereof.

     (b) Clause (h) of Section 5.01 of the Credit Agreement is hereby amended by inserting the
words “or during the Increased Reporting Period” immediately following the words “Level 1 Minimum
Aggregate Availability Period” in the fourth line thereof.

     4. Amendment to Section 6.01 (Indebtedness). Section 6.01(i) of the Credit Agreement is
hereby amended by adding the following words at the end of the parenthetical contained therein,
immediately before the “)”:

 

 

     “(such determination to be made without giving effect to the proviso set forth at the
end of Section 6.16)”

     5. Amendment to Section 6.16 (Fixed Charge Coverage Ratio). Section 6.16 of the
Credit Agreement is hereby deleted in its entirety and the following new Section 6.16 shall be
substituted in lieu thereof:

          “6.16 Fixed Charge Coverage Ratio. The Loan Parties will not permit the Fixed
Charge Coverage Ratio, as of the last day of any fiscal month, for any Test Period ending during
any period set forth below to be less than the ratio set forth below opposite such period:

	 	 	 	 	 
	Period	 	Fixed Charge Coverage Ratio
	The Effective Date through July 3, 2010
	 	1.25 to 1.00	 
	 
	July 4, 2010 and thereafter
	 	1.50 to 1.00	 

          ; provided however, that for any Test Period ending on or after May 2, 2009
and prior to July 31, 2010, the provisions of this Section 6.16 shall only be applicable if the
Aggregate Availability for two consecutive days is less than the Required Availability Amount.”

     6. Amendment to Section 6 (Negative Covenants). Section 6 of the Credit Agreement is
hereby amended by inserting the following new Section 6.17 at the end thereof:

     “SECTION 6.17 Minimum Aggregate Availability. The Loan Parties will not permit
the Aggregate Availability at any time to be less than $50,000,000 (or, on any date on or
after October 4, 2009 and prior to December 6, 2009, $45,000,000).”

     7. Amendment to Section 1.01 (Defined Terms). Clause (h) of the definition of “US
Borrowing Base” in Section 1.01 of the Credit Agreement is hereby amended by deleting the words “on
or prior to October 31, 2009,” contained therein.

     8. Representations and Warranties. The Borrowers hereby represent that as of the
Second Amendment Effective Date each of the representations and warranties made by any Loan Party
in or pursuant to the Loan Documents is true and correct in all material respects as if made on and
as of such date (it being understood and agreed that any representation or warranty that by its
terms is made as of a specific date shall be required to be true and correct in all material
respects only as of such specified date), and no Default or Event of Default has occurred and is
continuing after giving effect to the amendments contemplated herein.

     9. Effectiveness of Amendment. This Second Amendment shall become effective on and as
of the date (such date the “Second Amendment Effective Date”) of satisfaction of the
following conditions:

          (a) execution and delivery of this Second Amendment by the Borrowers, the Administrative
Agent and the Required Lenders;

          (b) receipt by the Administrative Agent of an amendment fee for the account of each Lender
consenting to this Second Amendment by 5:00 P.M. (New York City time) on May 12, 2009, in an
amount equal to 0.50% of such Lender’s Commitment;

 

 

          (c) receipt by the Administrative Agent of all other fees required to be paid, and all
expenses for which invoices have been presented (including the reasonable fees and expenses of
legal counsel);

          (d) solely with respect to the amendment set forth in clause 7 above, execution and delivery
of this Second Amendment by the Supermajority Lenders.

     10. Expenses. The Borrowers agree to pay and reimburse the Administrative Agent for
all its reasonable costs and out-of-pocket expenses incurred in connection with the preparation and
delivery of this Second Amendment, including, without limitation, the reasonable fees and
disbursements of counsel to the Administrative Agent.

     11. Effect. Except as expressly amended hereby, all of the representations,
warranties, terms, covenants and conditions of the Loan Documents shall remain unamended and not
waived and shall continue to be in full force and effect.

     12. Counterparts. This Second Amendment may be executed in any number of counterparts
by the parties hereto (including by facsimile transmission), each of which counterparts when so
executed shall be an original, but all the counterparts shall together constitute one and the same
instrument.

     13. Severability. Any provision of this Second Amendment which 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 any
such prohibition or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

     14. Integration. This Second Amendment and the other Loan Documents represent the
entire agreement of the Loan Parties, the Administrative Agent, the European Administrative Agent,
the Canadian Administrative Agent and the Lenders with respect to the subject matter hereof, and
there are no promises, undertakings, representations or warranties by the Administrative Agent, the
European Administrative Agent, the Canadian Administrative Agent or any Lender relative to the
subject matter hereof not expressly set forth or referred to herein or in the other Loan Documents.

     15. GOVERNING LAW. THIS SECOND AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS SECOND AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

 

          IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment to be duly executed
and delivered by their proper and duly authorized officers as of the day and year first above
written.

	 	 	 	 	 	 	 
	 	 	BORROWERS
	 
	 	 	 	 	 	 
	 	 	LIZ CLAIBORNE, INC.
	 
	 	 	 	 	 	 
	 

	 	By

Name:
	 	/s/ Nicholas Rubino
 

Nicholas Rubino
	 	 
	 

	 	Title:
	 	Senior Vice President, Chief Legal Officer,
General Counsel and Secretary	 	 
	 
	 	 	 	 	 	 
	 	 	LIZ CLAIBORNE CANADA, INC.
	 
	 	 	 	 	 	 
	 

	 	By

Name:
	 	/s/ Nicholas Rubino
 

Nicholas Rubino
	 	 
	 

	 	Title:
	 	Senior Vice President, Chief Legal Officer,
General Counsel and Secretary	 	 
	 
	 	 	 	 	 	 
	 	 	MEXX EUROPE B.V.
	 
	 	 	 	 	 	 
	 

	 	By

Name:
	 	/s/Gerard Berghuis
 

Gerard Berghuis
	 	 
	 

	 	Title:
	 	Director	 	 

SIGNATURE PAGE TO THE SECOND AMENDMENT

 

 

	 	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A., as Administrative Agent, US
Collateral Agent and Lender
	 
	 	 	 	 	 	 
	 

	 	By

Name:
	 	/s/ Donna M. Di Forio
 

Donna M. DiForio
	 	 
	 

	 	Title:
	 	Vice President	 	 

SIGNATURE PAGE TO THE SECOND AMENDMENT

 

 

	 	 	 	 	 	 	 
	 	 	J.P. MORGAN EUROPE LIMITED, as European
Administrative Agent and European Collateral Agent
	 
	 	 	 	 	 	 
	 

	 	By

Name:
	 	/s/ Tim Jacob
 

Tim Jacob
	 	 
	 

	 	Title:
	 	Senior Vice President	 	 

SIGNATURE PAGE TO THE SECOND AMENDMENT

 

 

	 	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A., TORONTO BRANCH, as
Canadian Administrative Agent and Canadian Collateral
Agent
	 
	 	 	 	 	 	 
	 

	 	By

Name:
	 	/s/ Dan Howat
 

Dan Howat
	 	 
	 

	 	Title:
	 	Senior Vice President	 	 

SIGNATURE PAGE TO THE SECOND AMENDMENT

 

 

	 	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A., as Lender
	 
	 	 	 	 	 	 
	 

	 	By

Name:
	 	/s/ Christine Hutchinson
 

Christine Hutchinson
	 	 
	 

	 	Title:
	 	Principal	 	 

SIGNATURE PAGE TO THE SECOND AMENDMENT

 

 

	 	 	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A., as Lender
	 
	 	 	 	 	 	 
	 

	 	By

Name:
	 	/s/ Bernisi Morrin
 

Bernisi Morrin
	 	 
	 

	 	Title:
	 	Vice President Operations Manager	 	 
	 

	 	 
	 	GCIB Credit Services Business
Capital Europe	 	 

SIGNATURE PAGE TO THE SECOND AMENDMENT

 

 

	 	 	 	 	 	 	 
	 

	 	 	 	BANK OF AMERICA, N. A.
(Canada branch), as Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By

Name:
	 	/s/ Medina Sales de Andrade
 

Medina Sales de Andrade
	 	 
	 

	 	Title:
	 	Vice President	 	 

SIGNATURE PAGE TO THE SECOND AMENDMENT

 

 

	 	 	 	 	 	 	 
	 	 	WACHOVIA BANK, NATIONAL ASSOCIATION, as Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By

Name:
	 	/s/ Susan T. Gallagher
 

Susan T. Gallagher
	 	 
	 

	 	Title:
	 	Director	 	 

SIGNATURE PAGE TO THE SECOND AMENDMENT

 

 

	 	 	 	 	 	 	 
	 	 	SunTrust Bank, as Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By

Name:
	 	/s/ Patrick Wiggins
 

Patrick Wiggins
	 	 
	 

	 	Title:
	 	Vice President	 	 

SIGNATURE PAGE TO THE SECOND AMENDMENT

 

 

	 	 	 	 	 	 	 
	 	 	HSBC Business Credit (USA) Inc., as Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By
	 	/s/ Kysha Pierre-Louis	 	 
	 

	 	Name:
	 	 

Kysha Pierre-Louis
	 	 
	 

	 	Title:
	 	Vice President	 	 

SIGNATURE PAGE TO THE SECOND AMENDMENT

 

 

	 	 	 	 	 	 	 
	 	 	THE BANK OF NEW YORK MELLON, as Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By
	 	/s/ Philip Falivene	 	 
	 

	 	Name:
	 	 

Philip Falivene
	 	 
	 

	 	Title:
	 	Managing Director	 	 

SIGNATURE PAGE TO THE SECOND AMENDMENT

 

 

	 	 	 	 	 	 	 
	 	 	CITIBANK, N.A., as Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By
	 	/s/ Thomas Halsch	 	 
	 

	 	Name:
	 	 

Thomas Halsch
	 	 
	 

	 	Title:
	 	Vice President	 	 

SIGNATURE PAGE TO THE SECOND AMENDMENTEX-10.1

    Exhibit
10.1
    

 

    DOVER
    CORPORATION

    2005 EQUITY AND CASH INCENTIVE PLAN

    (Amended and Restated as of January 1, 2009)

 

    A.  PURPOSE
    AND SCOPE OF THE PLAN

 

    1. Purpose.  The 2005 Equity and Cash
    Incentive Plan (the “Plan”) is intended to
    promote the long-term success of Dover Corporation by providing
    salaried officers and other key employees of Dover Corporation
    and its subsidiaries, on whom major responsibility for the
    present and future success of Dover Corporation rests, with
    long-range and medium-range inducement to remain with the
    organization and to encourage them to increase their efforts to
    make Dover Corporation successful. The term
    “Corporation” shall mean Dover Corporation and
    any present or future corporation which is or would be a
    “subsidiary corporation” of Dover Corporation as
    defined in Section 424 of the Internal Revenue Code of
    1986, as amended (the “Code”), unless the
    context requires otherwise.

 

    2. Successor Plan.  The Plan is the
    successor to the 1995 Incentive Stock Option Plan and 1995 Cash
    Performance Program (the “Predecessor Plan”).
    No further grants of options, restricted stock or cash
    performance awards may be made under the Predecessor Plan after
    the Predecessor Plan expires on January 30, 2005. Options,
    restricted stock, and performance awards under the Predecessor
    Plan shall be administered pursuant to the provisions of the
    Predecessor Plan.

 

    3. Administration.  The Plan shall be
    administered and interpreted by the Compensation Committee or
    such other Committee of the Board of Directors as the Board may
    designate if there is no Compensation Committee (the
    “Committee”), consisting of not less than three
    (3) persons appointed by the Board of Directors of Dover
    Corporation from among its members. A person may serve as a
    Committee member provided he or she shall comply in all respects
    with any qualifications required by law, including specifically
    being a “non-employee director” for purposes of the
    rules promulgated under the Securities Exchange Act of 1934, as
    amended (the “Exchange Act”), and an
    “outside director” for purposes of Section 162(m)
    of the Code and satisfying any other independence requirement
    under applicable law and regulations. The Committee will have
    sole and complete authority to administer all aspects of the
    Plan, including but not limited to: (a) determining the
    individuals eligible to receive stock options, SSARs (as defined
    in Paragraph 6), restricted stock, cash performance awards,
    and/or
    performance share awards under the Plan; (b) granting
    options, SSARs, restricted stock, cash performance awards, and
    performance share awards; (c) determining the number of
    shares to be subject to options and SSARs, and the amount of
    restricted stock, cash performance awards, and performance share
    awards to be granted to any such eligible individuals at any
    time or from time to time; (d) determining the terms and
    conditions under which option and SSAR grants, restricted stock
    awards, cash performance awards, and performance share awards
    will be made; and (e) determining whether objectives,
    conditions and performance targets for cash performance awards,
    performance share awards and, if applicable, other awards have
    been met. The Committee may, subject to the provisions of the
    Plan, from time to time establish such rules and regulations as
    it deems appropriate for the proper administration of the Plan.
    The Committee’s decisions shall be final, conclusive, and
    binding with respect to the interpretation and administration of
    the Plan and any grants or awards made thereunder. The Committee
    shall have the discretion to make awards under the Plan that are
    intended to meet the requirements of Section 162(m) of the
    Code as well as awards that are not intended to meet the
    requirements of Section 162(m) of the Code.

 

    4. Eligibility.  Option and SSAR grants,
    restricted stock awards, cash performance awards, and
    performance share awards may be made to any employee of the
    Corporation who is a salaried officer or other key employee,
    including salaried officers who are also members of the Board of

    

 

    Directors (hereinafter sometimes referred to as
    “participants”). The Committee shall select the
    participants eligible for, and determine the terms of, the
    grants and awards to each.

 

    5. Shares Available for Grant.  An
    aggregate maximum of 20,000,000 shares of common stock of
    Dover Corporation (the “Common Stock”) will be
    reserved for issuance upon exercise of options to purchase
    Common Stock granted under the Plan, the exercise of SSARs
    granted under the Plan, and for awards of restricted stock, and
    performance share awards. This maximum number is subject to
    appropriate adjustment resulting from future stock splits, stock
    dividends, recapitalizations, reorganizations, and other similar
    changes to be computed in the same manner as that provided for
    in Paragraph 14 below. If any option or SSAR granted under
    the Plan expires, terminates, or is cancelled without having
    been exercised in full, or if any award of restricted stock or
    award of performance shares is forfeited or canceled for any
    reason, the number of shares underlying such unexercised option
    or SSAR and the number of forfeited or cancelled shares under
    such award will again be available under the Plan. However, the
    total original number of shares subject to any option, SSAR,
    award of restricted stock, or award of performance shares
    granted under the Plan that is exercised, vests or held until
    payout shall continue to be counted against the aggregate
    maximum number of shares reserved for issuance under the Plan,
    even if such grant is settled in whole or in part other than by
    the delivery of Common Stock to a participant (including any
    netting or withholding of any shares to satisfy tax withholding
    obligations).

 

    B.  STOCK
    OPTION AND SSAR GRANTS

 

    6. Stock Options and SSARs.  Options to
    purchase shares of Common Stock may be granted under the terms
    of the Plan and shall be designated as either
    “non-qualified” stock options or “incentive”
    stock options (“ISOs”) within the meaning of
    Section 422 of the Code. Stock appreciation rights that are
    settled upon exercise by the issuance of shares of Common Stock
    (“SSARs”) may be granted under the terms of the
    Plan. SSARs shall be granted separately from options and the
    exercise of an SSAR shall not be linked in any way to the
    exercise of an option and shall not affect any option award then
    outstanding. Stock option grants and SSARs shall contain such
    terms and conditions as the Committee may from time to time
    determine, subject to the following limitations:

 

    (a) Exercise Price.  The price at which
    shares of Common Stock may be purchased upon exercise of an
    option shall be fixed by the Committee and may be equal to or
    more than (but not less than) the fair market value (as defined
    below) of a share of the Common Stock as of the date the option
    is granted.

 

    (b) Base Price.  The base price of an SSAR
    shall be fixed by the Committee and may be equal to or more than
    (but not less than) the fair market value of a share of the
    Common Stock as of the date the SSAR is granted.

 

    (c) Fair Market Value.  For purposes of
    the Plan, the fair market value of a share of Common Stock on
    the date the option or SSAR is granted shall be determined in
    good faith by the Committee on the basis of such considerations
    as the Committee deems appropriate from time to time, including,
    but not limited to, such factors as the closing price for a
    share of Common Stock on such day (or, if such day is not a
    trading day, on the next trading day) on the principal United
    States exchange on which the Common Stock then regularly trades
    (the “Exchange”), the average of the closing
    bid and asked prices for a share of Common Stock on the Exchange
    on the date the option or SSAR is granted by the Committee or
    the average of the high and low sales price of a share of Common
    Stock on the Exchange on the date the option or SSAR is granted
    by the Committee (“fair market value”). The
    Committee shall be authorized, in its discretion, to round up
    the fair market value of a share of Common Stock to the nearest
    whole number or quarterly fraction thereof.

    

 

    (d) Term.  The term of each option or SSAR
    will be for such period as the Committee shall determine as set
    forth in the stock option or SSAR agreement, but in no event
    shall the term of an option or SSAR be greater than
    10 years from the date of grant.

 

    (e) Rights of Holder.  A recipient of
    stock options or SSARs shall have no rights as a shareholder
    with respect to any shares issuable or transferable upon
    exercise thereof until the date of issuance of such shares.
    Except as specifically set forth in Paragraph 14 below, no
    adjustment shall be made for dividends or other distributions of
    cash or other property on or with respect to shares of stock
    covered by options or SSARs paid or payable to holders of record
    prior to such issuance.

 

    (f) Limits on Individuals.  The maximum
    number of shares of Common Stock covered by all options and
    SSARs granted to a single participant in any year may not exceed
    600,000. The aggregate fair market value (determined on the date
    of grant) of Common Stock with respect to which a participant is
    granted ISOs (including ISOs granted under the Predecessor Plan)
    which first become exercisable during any given calendar year
    shall not exceed $100,000.

 

    7. Exercise.  An option or SSAR granted
    under the Plan shall be exercisable during the term of the
    option or SSAR subject to such terms and conditions as the
    Committee shall determine and are specified in the stock option
    or SSAR agreement, not inconsistent with the terms of the Plan;
    provided, however, that except as set forth in
    Paragraphs 11, 14 and 41, no option or SSAR may be
    exercised prior to the third (3rd) anniversary of the date of
    its grant and any partial exercise of an option or SSAR shall be
    with respect to not fewer than 500 shares. In addition, the
    Committee may condition the exercise of an option or SSAR upon
    the attainment by the Corporation or any subsidiary or division
    or by the participant of any performance targets set by the
    Committee. The shares to be issued upon exercise of an option or
    SSAR will be either treasury or authorized and unissued stock,
    in the sole discretion of the Corporation.

 

    (a) Option.  To exercise an option, the
    option holder must give written notice to the Corporation of the
    number of shares to be purchased accompanied by payment of the
    full purchase price of such shares as set forth in
    Paragraph 8. The date when the Corporation has actually
    received both such notice and payment shall be deemed the date
    of exercise of the option with respect to the shares being
    purchased and the shares shall be issued as soon as practicable
    thereafter.

 

    (b) SSAR.  To exercise an SSAR, the SSAR
    holder must give written notice to the Corporation of the number
    of SSARs being exercised as provided in the SSAR agreement. No
    payment shall be required to exercise an SSAR. The date of
    actual receipt by the Corporation of such notice shall be deemed
    to be the date of exercise of the SSAR and the shares issued in
    settlement of such exercise therefor shall be issued as soon as
    practicable thereafter. Upon the exercise of an SSAR, the SSAR
    holder shall be entitled to receive from the Corporation for the
    SSARs being exercised that number of whole shares of Common
    Stock having a fair market value on the date of exercise of the
    SSAR equal in value to the excess of (A) the fair market
    value of a share of Common Stock on the exercise date multiplied
    by the number of SSARs being exercised over (B) the sum of
    (i) the aggregate base prices of the SSARs being exercised
    multiplied by the number of SSARs being exercised, plus
    (ii) unless the holder elects to pay such tax in cash, any
    amount of tax that must be withheld in connection with such
    exercise. For this purpose, the fair market value of a share of
    Common Stock on the date of exercise of a SSAR shall be the
    average of the high and low sales price of a share of Common
    Stock on the Exchange on the date a SSAR is exercised or if no
    sales have occurred on that date, such value will be the closing
    price per share on the next trading date following the exercise
    of the SSAR. Fractional shares of Common Stock shall be
    disregarded upon exercise of an SSAR unless otherwise determined
    by the Committee.

 

    8. Payment of Exercise Price.  Payment of
    the option exercise price must be made in full at the time of
    exercise (a) by check made payable to the Corporation,
    (b) by transfer to the

    

 

    Corporation of shares of Common Stock owned by the participant,
    or (c) with a combination of the foregoing. If payment is
    made by the transfer of shares, the shares of Common Stock to be
    transferred to the Corporation must have been owned by the
    option holder for such minimum period as may be required to
    prevent the Corporation from incurring an adverse accounting
    charge, the value per share of the shares so transferred to the
    Corporation to be credited toward the purchase price will be the
    average between the high and the low sales price per share of
    Common Stock on the Exchange on the date the option is exercised
    or, if no sales have occurred on that date, such value will be
    the closing price per share on the Exchange on the next trading
    day following the exercise of the option. The shares transferred
    to the Corporation will be added to the Corporation’s
    treasury shares or canceled and become authorized and unissued
    shares. Notwithstanding the foregoing, such shares will continue
    to be counted against the maximum number of shares for which
    options and SSARs may be granted to a participant pursuant to
    Section 6(f).

 

    9. Transfers.  The options and SSARs
    granted under the Plan may not be sold, transferred,
    hypothecated, pledged, or otherwise disposed of by any of the
    holders except by will or by the laws of descent and
    distribution, or as otherwise provided herein. The option or
    SSARs of any person to acquire stock and all rights thereunder
    shall terminate immediately if the holder attempts to or does
    sell, assign, transfer, pledge, hypothecate or otherwise dispose
    of the option or SSAR or any rights thereunder to any other
    person except as permitted herein. Notwithstanding the
    foregoing, a participant may transfer any non-qualified stock
    option (but not ISOs or SSARs) granted under this Plan to
    members of the holder’s immediate family (defined as a
    spouse, children
    and/or
    grandchildren), or to one or more trusts for the benefit of such
    family members if the instrument evidencing such option
    expressly so provides and the option holder does not receive any
    consideration for the transfer; provided that any such
    transferred option shall continue to be subject to the same
    terms and conditions that were applicable to such option
    immediately prior to its transfer (except that such transferred
    option shall not be further transferred by the transferee during
    the transferee’s lifetime).

 

    10. Registration.  The Corporation will
    stamp stock certificates delivered to the shareholder with an
    appropriate legend if the shares are not registered under the
    Securities Act of 1933, as amended (the “Securities
    Act”), or are otherwise not free to be transferred by
    the holder and will issue appropriate stop-order instructions to
    the transfer agent for the Common Stock, if and to the extent
    such stamping or instructions may then be required by the
    Securities Act or by any rule or regulation of the Securities
    and Exchange Commission issued pursuant to the Securities Act.

 

    11. Effect of Death, or Disability or
    Retirement.  If an option or SSAR holder dies or
    becomes disabled while employed by the Corporation, all options
    or SSARs held by such holder shall become immediately
    exercisable and the holder or such holder’s estate or the
    legatees or distributees of such holder’s estate or of the
    options or SSARs, as the case may be, shall have the right, on
    or before the earlier of the respective expiration date of an
    option or SSAR or sixty (60) months following the date of
    such death or disability, to exercise any or all options or
    SSARs held by such holder as of such date of death or
    disability. If an option or SSAR holder retires at or after
    age 62, the holder shall have the right, on or before the
    earlier of the expiration date of the option or SSAR or sixty
    (60) months following the date of such retirement, to
    purchase shares under any options or SSARs which at retirement
    are, or within sixty (60) months following retirement
    become, exercisable.

 

    If the employment of a holder of an option or SSAR terminates
    for any reason other than (i) the reasons specified above
    or (ii) termination for “cause” (as defined
    below), and one of the following sets of circumstances is
    applicable: (a) the holder has at least 10 years of
    service with the Corporation (including service with any
    subsidiary corporation of the Corporation while it is owned by
    the Corporation), the sum of the holder’s years of service
    plus his or her age on the date of such termination equals at
    least 65 and the holder satisfies the notice requirements set
    forth below (“Early Retirement I”),
    (b) the holder has at least 15 years of service with
    the Corporation (including service with any subsidiary
    corporation of the Corporation while is it owned by the

    

 

    Corporation), the sum of the holder’s years of service plus
    his or her age on the date of such termination equals at least
    70 and the holder satisfies the notice requirements set forth
    below (“Early Retirement II”), or (c) such
    holder’s employment with the Corporation terminates due to
    the sale of stock or assets of the subsidiary corporation (or
    line of business) by which the holder is employed and the holder
    is so employed in good standing by the subsidiary or line of
    business through the date of such sale (“Early
    Retirement III”) each of Early
    Retirement I, II and III from time to time being
    referred to herein as “Early Retirement”), the holder
    shall have the right (subject to the provisions of
    Paragraph 42 below), (x) in the event of Early
    Retirement I, on or before the earlier of the expiration
    date of the option or SSAR or twenty-four (24) months
    following the date of such Early Retirement, to exercise, and
    acquire shares under, any options or SSARs which at such
    termination are, or within twenty-four (24) months
    following such termination become, exercisable, (y) in the
    event of Early Retirement II, on or before the earlier of the
    expiration date of the option or SSAR or thirty-six
    (36) months following the date of such Early Retirement, to
    exercise, and acquire shares under, any options or SSARs which
    at such termination are, or within thirty-six (36) months
    following such termination become, exercisable, or (z) in
    the event of Early Retirement III, on or before the earlier of
    the expiration date of the option or SSAR or twelve
    (12) months following the date of such Early Retirement, to
    exercise, and acquire shares under, any options or SSARs which
    at such termination are, or within twelve (12) months
    following such termination become, exercisable. Notwithstanding
    the above, if a holder taking Early Retirement III would
    also qualify for Early Retirement I or II excluding the
    notice requirement, the holder shall be entitled to the benefits
    of Early Retirement I or II, as appropriate.

 

    In order to be eligible for Early Retirement I or II, the holder
    must give six (6) months advance notice of retirement and
    must continue to be employed by the Corporation (or any
    subsidiary corporation provided such subsidiary corporation
    continues to be owned by the Corporation throughout the notice
    period) and perform his or her duties throughout such notice
    period. Failure to satisfy the notice requirement will render
    the holder ineligible for Early Retirement I or II
    notwithstanding the satisfaction by the holder of all other
    applicable requirements. Dover’s Chief Executive Officer
    shall have the authority to reduce or waive the required notice
    period.

 

    12. Voluntary or Involuntary
    Termination.  If any option or SSAR holder’s
    employment with the Corporation is voluntarily or involuntarily
    terminated for any reason, other than for reasons or in
    circumstances specified above or for “cause” (as
    defined below), the holder shall have the right at any time on
    or before the earlier of the expiration date of the option or
    SSAR or three (3) months following the effective date of
    such termination of employment, to exercise, and acquire shares
    under, any options or SSARs which at such termination are
    exercisable.

 

    13. Termination for Cause.  If an option
    or SSAR holder’s employment with the Corporation is
    terminated for cause (defined as (a) a felony conviction of
    the holder; (b) the commission by the holder of an act of
    fraud or embezzlement against the Corporation; or (c) the
    holder’s willful misconduct or gross negligence materially
    detrimental to the Corporation), the option or SSAR shall be
    canceled and the holder shall have no further rights to exercise
    any such option or SSAR and all of such holder’s rights
    thereunder shall terminate as of the effective date of
    termination of employment.

 

    14. Effect of Stock Dividends, Merger, Recapitalization
    or Reorganization or Similar Events.  If any
    Common Stock dividend is paid by the Corporation, if any
    non-cash distribution is made by the Corporation as respects its
    Common Stock, if the shares of Common Stock are split or
    reclassified, if the Corporation should be reorganized or
    consolidated or merged with or into another corporation, or if
    all or substantially all the assets of the Corporation are
    transferred to any other corporation in a reorganization, each
    option or SSAR holder shall be entitled, upon exercise of such
    holder’s option or SSAR, to receive for the same aggregate
    exercise price in the case of an option, or upon exercise of the
    SSAR, the same number and kind of shares of stock (to the
    nearest whole number) as he or she would have been entitled to
    receive upon the happening of such stock dividend, distribution,
    stock split, reclassification, reorganization, consolidation,
    merger or transfer,

    

 

    if he or she had been, immediately prior to such event, the
    holder of such shares. Outstanding options and SSARs shall be
    appropriately amended as to exercise price or base price and
    other terms in a manner consistent with the aforementioned
    adjustment to the shares of Common Stock subject to the Plan.
    The adjustments to be made pursuant to this Paragraph 14
    shall meet the requirements of Section 409A of the Code and
    the regulations thereunder. The Board of Directors shall have
    the power, in the event of any disposition of substantially all
    of the assets of the Corporation, its dissolution, any merger or
    consolidation, or the merger or consolidation of any other
    corporation into the Corporation, to amend all outstanding
    options and SSARs to permit their exercise prior to the
    effectiveness of any such transaction and to terminate such
    options or SSARs as of such effectiveness. If the Board of
    Directors shall exercise such power, all options and SSARs
    outstanding shall be deemed to have been amended to permit the
    exercise thereof in whole or in part by the holder at any time
    or from time to time as determined by the Board of Directors
    prior to the effectiveness of such transaction and such options
    and SSARs shall be deemed to terminate upon such effectiveness.

 

    15. Change in Control.  Options and SSARs
    and grantees of options and SSARs shall be subject to the terms
    of Paragraph 41 below related to a change in control of the
    Corporation.

 

    C.  RESTRICTED
    STOCK AWARDS

 

    16. Grant.  Subject to the provisions and
    as part of the Plan, the Committee shall have the discretion and
    authority to award to persons eligible to participate in the
    Plan shares of Common Stock which are subject to specified
    forfeiture restrictions during a specified restriction period
    and subject to the other applicable terms of the Plan
    (“restricted stock”). Subject to the provisions
    of the Plan, awards of restricted stock shall contain such terms
    and conditions as the Committee may determine at the time of
    award; provided, however, in no event shall the
    aggregate number of shares of restricted stock awarded under the
    Plan plus the aggregate number of performance shares awarded
    under the Plan exceed ten percent (10%) of the total number of
    shares reserved for issuance under the Plan in accordance with
    Paragraph 5 hereof. The maximum number of shares of Common
    Stock that may be paid to a single participant in any year as
    restricted stock may not exceed 600,000. The Committee may
    condition the vesting of restricted stock awards upon the
    attainment of performance targets established by the Committee
    as provided in
    paragraphs 33-36
    below.

 

    17. Term of Restriction Period.  The
    Committee may adopt such vesting schedules, not less than one
    (1) year and not longer than five (5) years from the
    date of the award, as it may deem appropriate with respect to
    awards of restricted stock and may condition the lapse of the
    restrictions applicable to an award upon the attainment by the
    Corporation or any subsidiary or division or by the participant
    of any performance targets set by the Committee as provided in
    paragraphs 33-36
    below.

 

    18. Issuance of Shares.  Certificates
    issued for restricted stock shall be registered in the name of
    the participant and deposited by the participant with the
    Secretary of the Corporation, together with a stock power
    endorsed in blank. Upon lapse of the applicable restriction
    period
    and/or
    attainment of any applicable performance targets
    and/or
    satisfaction of any other restrictions, the Corporation shall
    deliver such shares of stock to the participant. In the event
    that the shares of restricted stock are forfeited, such shares
    automatically shall be transferred back to the Corporation. The
    Corporation will stamp any stock certificates delivered to the
    participant with an appropriate legend if the shares are not
    registered under the Securities Act, or are otherwise not free
    to be transferred by the participant and will issue appropriate
    stop-order instructions to the transfer agent for the Common
    Stock, if and to the extent such stamping or instructions may
    then be required by the Securities Act or by any rule or
    regulation of the Securities and Exchange Commission issued
    pursuant to the Securities Act.

    

 

    19. Dividends and Voting Rights.  In the
    discretion of the Committee, dividends which become payable with
    respect to restricted stock during the restriction period may be
    reinvested in additional shares of restricted stock for the
    account of the award recipient, or accumulated for later
    distribution to vested participants (in each case, such amounts
    shall be payable upon fixed dates or events in accordance with
    the requirements of Section 409A of the Code), or
    distributed to the award recipient as paid. An employee who
    receives an award of restricted stock may also, in the
    discretion of the Committee, be entitled, during the restriction
    period, to exercise voting rights with respect to such
    restricted stock.

 

    20. Nontransferability.  Shares of
    restricted stock may not be sold, assigned, transferred, pledged
    or otherwise encumbered and shall not be subject to execution,
    attachment, garnishment or other similar legal process, except
    as otherwise provided in the applicable award agreement. Upon
    any attempt to sell, transfer, assign, pledge, or otherwise
    encumber or dispose of the restricted stock contrary to the
    provisions of the award agreement or the Plan, the restricted
    stock shall immediately be forfeited to the Corporation.

 

    21. Termination of Employment.  In the
    case of a participant’s disability, death, termination of
    employment by the Corporation other than for cause (as defined
    in Paragraph 13 above) or special circumstances, as
    determined by the Committee, any purely temporal restrictions
    remaining with respect to shares of restricted stock as of the
    date of such disability, death or termination of employment
    shall lapse and, if any performance targets are applicable, the
    shares of restricted stock shall continue to vest as if the
    participant’s employment had not terminated until the
    prescribed time for determining attainment of performance
    targets has passed and the appropriate determination of
    attainment of performance targets has been made. If the
    participant’s employment with the Corporation is terminated
    as a result of (a) the retirement of the participant at or
    after age 62, or (b) an Early Retirement, subject to
    the provisions of Paragraph 42 below in the case of Early
    Retirement, then, in either such case, the shares of restricted
    stock shall continue to vest as if the participant’s
    employment had not terminated until such time as the remaining
    temporal restrictions lapse and, if any performance targets are
    applicable, the prescribed time for determining attainment of
    performance targets has passed and the appropriate determination
    of attainment of performance targets has been made. If a
    participant’s employment with the Corporation is
    voluntarily or involuntarily terminated for any other reason
    during the restriction period, the shares of restricted stock
    shall be forfeited. Except as provided in paragraph 35,
    payment of restricted stock that is subject to performance
    targets shall be subject to satisfaction of applicable
    performance targets and certification by the Committee of the
    attainment of such targets and the amount of the payment.

 

    22. Effect of Stock Dividends, Merger, Recapitalization
    or Reorganization or Similar Events.  In the event
    of a stock dividend, merger, recapitalization, reorganization,
    or other transaction described in Paragraph 14 above, the
    terms and conditions of the restricted stock awards shall be
    adjusted in a manner consistent with adjustments made to options
    granted under the Plan.

 

    23. Change in Control.  Awards of
    restricted stock and participants who are awarded restricted
    stock shall be subject to the terms of Paragraph 41 below.

 

    24. Cancellation.  The Committee may at
    any time, with due consideration to the effect on the holder of
    Section 409A of the Code, require the cancellation of any
    award of restricted stock in consideration of a cash payment or
    alternative award under the Plan equal to the fair market value
    of the cancelled award of restricted stock.

 

    D.  CASH
    PERFORMANCE AWARDS

 

    25. Awards and Period of Contingency.  
    The Committee may, concurrently with, or independently of, the
    granting of an option, SSAR or other award under the Plan, in
    its sole discretion, grant to a participant the opportunity to
    earn a cash performance payment, conditional upon the
    satisfaction of objective pre-established performance targets
    with respect to performance criteria as set forth in
    paragraphs 33-36
    below. The performance period shall be not less than three

    

 

    (3) fiscal years of the Corporation, including the year in
    which the award is made. The Corporation shall make a payment in
    respect of any award only if the Committee shall have certified
    that the applicable performance targets have been satisfied for
    a performance period. The aggregate maximum cash payout for any
    business unit within the Corporation or the Corporation as a
    whole shall not exceed a fixed percentage of the value created
    at the relevant business unit during the performance period,
    determined using such criteria as may be specified by the
    Committee, such percentages and dollar amounts to be determined
    by the Committee annually when performance targets and
    performance criteria are established. In no event shall a
    participant receive a payment in respect of a performance period
    that exceeds $5,000,000. Cash performance awards shall be paid
    within two and one-half months following the year in which the
    relevant performance period ends.

 

    26. Effect of Death, Disability, or Early
    Retirement.  If a participant in the Plan holding
    a cash performance award dies or becomes disabled while employed
    by the Corporation, then, the participant (or the
    participant’s estate or the legatees or distributees of the
    participant’s estate, as the case may be) shall be entitled
    to receive on the payment date the cash payment which the
    participant would have earned had the participant then been an
    employee of the Corporation, multiplied by a fraction, the
    numerator of which is the number of months the participant was
    employed by the Corporation during the performance measurement
    period and the denominator of which is the number of months of
    the performance measurement period (treating fractional months
    as whole months in each case). Except as provided in
    paragraph 35, such payment shall be subject to satisfaction
    of the applicable performance targets and certification by the
    Committee of the attainment of such performance targets.

 

    If the participant in the Plan is the subject of Early
    Retirement I or Early Retirement II (as defined in
    Paragraph 11) and on the date of such Early Retirement
    the participant holds one or more outstanding cash performance
    awards, the Committee, or if the Committee delegates to the
    Corporation’s Chief Executive Officer such authority, the
    Corporation’s Chief Executive Officer, shall determine in
    its sole discretion whether the participant is eligible to
    receive any payment and, if so, the amount thereof, in which
    event such payment shall be made on the date or dates following
    the date of the participant’s Early Retirement on which the
    Corporation pays cash performance awards for the performance
    measurement period relating to any such outstanding cash
    performance award held by such participant. Any such payment to
    a participant shall be subject to the satisfaction of the
    applicable performance targets, certification by the Committee
    of the satisfaction of such performance targets and
    determination of the amount of the payment by the Committee, and
    the provisions of Paragraph 42 below, and may not exceed
    the amount that the participant would have been entitled to
    receive had the participant been an employee of the Corporation
    on such payment date. Except as provided in this
    Paragraph 26, if the participant is the subject of Early
    Retirement I or II, all cash performance awards held by such
    participant shall be canceled and all of the participant’s
    awards thereunder shall terminate as of the effective date of
    such Early Retirement. If the participant in the Plan is the
    subject of Early Retirement III, all cash performance awards
    held by such participant shall be cancelled and all of the
    participant’s rights thereunder shall terminate as of the
    effective date of such Early Retirement.

 

    27. Effect of Normal Retirement.  If,
    before the date of payment, the participant retires on or after
    age 62, the participant shall be entitled to receive on the
    payment date the same amount of cash which the participant would
    have earned had such participant been an employee of the
    Corporation as of such date, subject to the satisfaction of the
    applicable performance targets and certification by the
    Committee of the attainment of such performance targets and the
    amount of the payment.

 

    28. Effect of Other Terminations of
    Employment.  

 

    (a) General Termination.  If a
    participant’s employment with the Corporation is terminated
    for any other reason, whether voluntary, involuntary, or for
    cause (as defined as Paragraph 13 above), other than those
    described in Paragraphs 26 or 27 above or in

    

 

    Paragraph 28(b) below, then his or her outstanding cash
    performance awards shall be canceled and all of the
    participant’s rights under any such award shall terminate
    as of the effective date of the termination of such employment.

 

    (b) Pre-Payment Termination.  If, after
    the end of a performance measurement period and before the date
    of payment of any final award, a participant’s employment
    is terminated, whether voluntarily or involuntarily for any
    reason other than for cause (as defined in Paragraph 13
    above), the participant shall be entitled to receive on the
    payment date the cash payment which the participant would have
    earned had the participant continued to be an employee of the
    Corporation as of the payment date, subject to the satisfaction
    of the applicable performance targets and certification by the
    Committee of the attainment of such performance targets and the
    amount of the payment.

 

    (c) Change in Control.  The treatment of
    any performance targets and each participant who is granted a
    cash performance award shall be subject to the terms of
    Paragraph 41 below.

 

    E.  PERFORMANCE
    SHARE AWARDS

 

    29. Awards and Period of Contingency.  The
    Committee may, concurrently with, or independently of, any other
    award under the Plan, in its sole discretion, grant to a
    participant the opportunity to receive shares of Common Stock
    (with or without payment or other consideration therefor),
    conditional upon the satisfaction of pre-established performance
    targets with respect to specified performance criteria as set
    forth in
    paragraphs 33-36
    below (“performance shares”) during a
    performance period of not less than three (3) fiscal years
    of the Corporation, including the year in which the conditional
    award is made. Any such grant may set a specific number of
    performance shares that may be earned, or a range of performance
    shares that may be earned, depending on the degree of
    achievement of performance targets pre-established by the
    Committee. In no event shall the aggregate number of performance
    shares awarded under the Plan plus the aggregate number of
    shares of restricted stock awarded under the Plan exceed ten
    percent (10%) of the total number of shares reserved for
    issuance under the Plan in accordance with Paragraph 5
    hereof. The maximum number of shares of Common Stock that may be
    paid to a single participant as payment for a performance share
    award for any performance period shall not exceed
    600,000 shares. Performance share awards shall be paid
    within two and one-half months following the year in which the
    relevant performance period ends. The Corporation shall issue
    Common Stock in payment of performance share awards only if the
    Committee shall have certified that the applicable performance
    targets have been satisfied. Unless the participant shall have
    elected and made arrangements to pay such tax in cash, the
    Corporation shall be permitted to withhold from the payment of
    performance shares such number of shares (or any cash), to the
    extent permitted by law, as the Corporation shall determine to
    be necessary to pay any amount of federal, state, local and
    foreign tax that must be withheld in connection with such
    payment. No fractional shares of Common Stock shall be issued in
    payment of a performance share award. Prior to the issuance of
    shares of Common Stock, a participant shall not be the legal or
    beneficial owner of shares subject to a performance share award
    and shall not have any voting rights or rights to distributions
    with respect to such shares, provided that the Committee
    may specify that the participant is entitled to receive
    distributions that have a record date on or after the date of
    certification by the Committee but before the shares are issued.
    Grants with respect to performance shares under the Plan may not
    be sold, transferred, hypothecated, pledged, or otherwise
    disposed of by any holder except by will or by the laws of
    descent and distribution, or as otherwise provided herein. All
    rights with respect to such grants shall terminate immediately
    if the holder attempts to or does sell, assign, transfer,
    pledge, hypothecate or otherwise dispose of any such rights to
    any other person except as permitted herein. In the event of a
    stock dividend, merger, recapitalization, reorganization, or
    other transaction described in Paragraph 14 above, the
    terms and conditions of performance share awards shall be
    adjusted in a manner consistent with adjustments made to options
    granted under the Plan.

    

 

    30. Effect of Death, Disability, or Early
    Retirement.  If a participant in the Plan holding
    a performance share award dies or becomes disabled while
    employed by the Corporation, then the participant (or the
    participant’s estate or the legatees or distributes of the
    participant’s estate, as the case may be) shall be entitled
    to receive on the payment date that number of shares of Common
    Stock which the participant would have earned had the
    participant then been an employee of the Corporation, multiplied
    by a fraction, the numerator of which is the number of months
    the participant was employed by the Corporation during the
    performance measurement period and the denominator of which is
    the number of months of the performance measurement period
    (treating fractional months as whole months in each case).
    Except as provided in paragraph 35, such payment shall be
    subject to satisfaction of the applicable performance targets
    and certification by the Committee of the attainment of such
    performance targets and the amount of payment.

 

    If the participant in the Plan is the subject of Early
    Retirement I or Early Retirement II (as defined in
    Paragraph 11) and on the date of such Early Retirement
    the participant holds one or more outstanding performance share
    awards, the Committee, or if the Committee delegates to the
    Corporation’s Chief Executive Officer such authority, the
    Corporation’s Chief Executive Officer, shall determine in
    its sole discretion whether the participant shall receive any
    payment and, if so, the amount thereof, in which event such
    payment shall be made on the date or dates following the date of
    the participant’s Early Retirement on which the Corporation
    pays performance share awards for the performance measurement
    period relating to any such outstanding performance share award
    held by such participant. Any such payment to the participant
    shall be subject to the satisfaction of the applicable
    performance targets, and certification by the Committee of such
    satisfaction and determination by the Committee of the amount of
    payment, shall be subject to the provisions of Paragraph 42
    below, and may not exceed the number of shares that the
    participant would have been entitled to receive had the
    participant been an employee of the Corporation on such payment
    date. Except as provided in this Paragraph 30, if the
    participant is the subject of Early Retirement I or II, all
    performance share awards held by such participant shall be
    canceled, and all of the participant’s awards thereunder
    shall terminate as of the effective date of such Early
    Retirement. If the participant in the Plan is the subject of
    Early Retirement III, all performance share awards held by such
    participant shall be cancelled and all of the participant’s
    rights thereunder shall terminate as of the effective date of
    such Early Retirement.

 

    31. Effect of Normal Retirement.  If,
    before the date of payment of a performance share award, the
    participant retires on or after age 62, the participant
    shall be entitled to receive on the payment date the same number
    of shares which the participant would have earned had such
    participant then been an employee of the Corporation as of such
    date, subject to the satisfaction of the applicable performance
    targets and certification by the Committee of the attainment of
    such performance targets and the amount of the payment.

 

    32. Effect of Other Terminations of Employment.

 

    (a) General Termination.  If a
    participant’s employment with the Corporation is terminated
    for any reason, whether voluntary, involuntary, or for cause (as
    defined as Paragraph 13 above), other than those described
    in Paragraphs 30 or 31 above or in Paragraph 32(b)
    below, then his or her outstanding performance share awards
    shall be canceled and all of the participant’s rights under
    any such award shall terminate as of the effective date of the
    termination of such employment.

 

    (b) Pre-Payment Termination.  If, after
    the end of a performance measurement period and before the date
    of payment of any final award, a participant’s employment
    is terminated, whether voluntarily or involuntarily for any
    reason other than for cause (as defined in Paragraph 13
    above), the participant shall be entitled to receive on the
    payment date the payment which the participant would have earned
    had the participant continued to be an employee of the
    Corporation as of the payment date, subject to the satisfaction
    of the

    

 

    applicable performance targets and certification by the
    Committee of the attainment of such performance targets and the
    amount of the payment.

 

    (c) Change in Control.  The treatment of
    any performance targets and each participant who is granted a
    performance share award shall be subject to the terms of
    Paragraph 41 below. In the event of a change in control,
    the Committee shall have the discretion to pay a performance
    share award by delivery to a participant of shares of Common
    Stock or cash equal to the fair market value on the last
    business day immediately prior to the change in control of the
    number of shares of Common Stock to which the participant is
    entitled, or any combination thereof.

 

    F.  PERFORMANCE
    CRITERIA

 

    33. Establishment of Performance
    Targets.  The Committee may, in its sole
    discretion, grant an award under the Plan conditional upon the
    satisfaction of objective pre-established performance targets
    based on specified performance criteria during a performance
    period. The performance period for cash performance awards and
    performance shares shall be not less than three (3) full
    fiscal years of the Corporation, including the year in which an
    award is made and may be shorter in the case of other awards but
    not less than one full fiscal year. Any performance targets
    established by the Committee shall include one or more objective
    formulas or standards for determining the amount of the
    performance award payable to a participant if the targets are
    satisfied in whole or in part. The performance targets may be
    fixed by the Committee for the Corporation as a whole or for a
    subsidiary, division, or business unit, depending on the
    Committee’s judgment as to what is appropriate, and shall
    be set by the Committee not later than the earlier of the
    90th day after the commencement of the period of services
    to which the performance payment relates or by the time 25% of
    such period of services has elapsed, in either case, provided
    that the outcome of the targets is substantially uncertain at
    the time the targets are established. The performance targets
    with respect to a performance period need not be the same for
    all participants.

 

    34. Performance Criteria.  Performance
    targets shall be based on at least one or more of the following
    performance criteria which the Committee deems appropriate, as
    they apply to the Corporation as a whole or to a subsidiary, a
    division, or business unit: (a) earnings before interest,
    taxes, depreciation and amortization, (b) cash flow,
    (c) earnings per share, (d) operating earnings,
    (e) return on equity, (f) return on investment,
    (g) total shareholder return or internal total shareholder
    return, (h) net earnings, (i) sales or revenue,
    (j) expense targets, (k) targets with respect to the
    value of common stock, (l) margins, (m) pre-tax or
    after-tax net income, (n) market penetration,
    (o) geographic goals, (p) business expansion goals, or
    (q) goals based on operational efficiency.

 

    35. Approval and Certification.  Promptly
    after the close of a performance period, the Committee shall
    certify in writing if the performance targets have been met and
    determine the amount of awards payable to participants. The
    Committee shall have the discretion to approve proportional or
    adjusted awards under the Plan to address situations where
    participants join the Corporation, or transfer or are promoted
    within the Corporation, during a performance period, but only to
    the extent that such discretion would not cause an award
    intended to qualify as “qualified performance based
    compensation” to fail to so qualify. The Committee may, in
    its sole discretion, elect to make a payment to a disabled
    participant or to the participant’s estate (or to legatees
    or distributees, as the case may be, of the participant’s
    estate) in the case of death or upon a change in control as
    provided in Paragraph 41 below, without regard to actual
    attainment of the performance targets (or the Committee’s
    certification thereof), but only to the extent that such
    discretion would not cause an award intended to qualify as
    “qualified performance based compensation” to fail to
    so qualify.

 

    36. Committee Discretion.  

 

    (a) The Committee shall have the discretion to decrease the
    amount payable under any award made under the Plan upon
    attainment of a performance target. The Committee shall also
    have the

    

 

    discretion to decrease or increase the amount payable upon
    attainment of the performance target to take into account the
    effect on an award of any unusual, non-recurring circumstance,
    extraordinary items or change in accounting methods, but only to
    the extent that such discretion would not cause an award
    intended to qualify as “qualified performance based
    compensation” to fail to so qualify.

 

    (b) Except as provided in paragraph 36(a),
    (i) the Committee shall make a payment in respect of an
    award intended to qualify as “qualified performance-based
    compensation” under Section 162(m) only if the
    Committee shall have certified in writing that the applicable
    performance targets have been satisfied, and (ii) the
    Committee shall not increase the amount payable to a covered
    employee under any award intended to meet the requirements of
    Section 162(m) of the Code. The exercise of discretion by
    the Committee to decrease any award payable to a participant
    shall not result in an increase in the amount payable to a
    covered employee under any award intended to meet the
    requirements of Section 162(m) of the Code.

 

    G.  GENERAL
    PROVISIONS

 

    37. Legal Compliance.  It is the intent of
    the Corporation that the Plan comply in all respects with
    applicable provisions of the Exchange Act, including
    Section 16 and
    Rule 16b-3,
    so that any grant or award of options, SSARs, restricted stock
    or performance shares to, or other transaction by, a participant
    who is subject to the reporting requirements of
    Section 16(a) of the Exchange Act shall not result in
    short-swing profits liability under Section 16(b) (except
    for any transaction exempted under alternative Exchange Act
    rules or intended by such participant to be a non-exempt
    transaction). If it is the intent of the Corporation that any
    compensation income realized in connection with any grant or
    award under the Plan constitute “qualified
    performance-based compensation” within the meaning of
    Section 162(m) of the Code and the Treasury regulations
    issued thereunder, the Corporation does not intend to be subject
    to the limitations of Section 162(m) of the Code.
    Accordingly, if any provision of the Plan or any agreement
    relating to any grant or award under the Plan does not comply
    with the requirements of
    Rule 16b-3
    as then applicable to any such transaction so that such a
    participant would be subject to Section 16(b) liability
    (except for any transaction exempted under alternative Exchange
    Act rules or intended by such participant to be a non-exempt
    transaction), or if any provision of the Plan or any agreement
    relating to any grant or award under the Plan would limit, under
    Section 162(m) of the Code, the amount of compensation
    income that the Corporation would otherwise be entitled to
    deduct, such provision shall be construed or deemed amended to
    the extent necessary to conform to such requirements, or to
    eliminate such deductibility limitation, and the participant
    shall be deemed to have consented to such construction or
    amendment.

 

    38. Withholding Taxes.  The Corporation
    shall make arrangements for the collection of any Federal,
    State, or local taxes of any kind required to be withheld with
    respect to any transactions effected under the Plan. The
    obligations of the Corporation under the Plan shall be
    conditional on satisfaction of such obligations and the
    Corporation, to the extent permitted by law, shall have the
    right to deduct from any payment of any kind otherwise due to or
    with respect to a participant, the minimum amount of such taxes
    as may be determined by the Corporation to be required to be
    withheld by law. The Corporation may, in its discretion, elect
    to withhold shares from delivery to a participant upon exercise
    or payment of an award, or require that all or a portion of such
    shares be sold, to satisfy the Corporation’s withholding
    obligations under the Plan. A participant shall be solely
    responsible for any tax or other amounts payable with respect to
    amounts included in participant’s income under
    Section 409A of the Code in respect of awards received
    under the Plan, including penalties or interest.

 

    39. Effect of Recapitalization or
    Reorganization.  The obligations of the
    Corporation with respect to any grant or award under the Plan
    shall be binding upon the Corporation, its successors or
    assigns, including any successor or resulting company either in
    liquidation or merger of the Corporation into another company
    owning all the outstanding voting stock of the Corporation or in
    any other transaction whether by merger, consolidation or
    otherwise under which such succeeding or

    

 

    resulting company acquires all or substantially all the assets
    of the Corporation and assumes all or substantially all its
    obligations, unless options or SSARs are terminated in
    accordance with Paragraph 14.

 

    40. Employment Rights and
    Obligations.  Neither the making of any grant or
    award under the Plan, nor the provisions related to a change in
    control of the Corporation (as defined below) or a Person (as
    defined below) seeking to effect a change in control of the
    Corporation, shall alter or otherwise affect the rights of the
    Corporation to change any and all the terms and conditions of
    employment of any participant including, but not limited to, the
    right to terminate such participant’s employment.

 

    41. Change in Control.  Each participant,
    upon acceptance of a grant or award under the Plan, and as a
    condition to such grant or award, shall be deemed to have agreed
    that, in the event any Person begins a tender or exchange offer,
    circulates a proxy to shareholders, or takes other steps seeking
    to effect a change in control of the Corporation (as defined
    below), such participant will not voluntarily terminate his or
    her employment with the Corporation or with a direct or indirect
    subsidiary of the Corporation, as the case may be, and, unless
    terminated by the Corporation or such subsidiary, will continue
    to render services to the Corporation or such subsidiary until
    such Person has abandoned, terminated or succeeded in such
    efforts to effect a change in control.

 

    (a) In the event of a change in control,

 

    (i) all options and SSARs to purchase or acquire shares of
    common stock of the Corporation shall immediately vest and
    become exercisable in accordance with the terms of the
    appropriate stock option or SSAR agreement;

 

    (ii) all outstanding restrictions, including any
    performance targets, with respect to any restricted stock shall
    immediately expire and be deemed to have been satisfied;

 

    (iii) with respect to cash performance award and
    performance share awards:

 

    (A) all cash performance awards and performance share
    awards outstanding shall immediately vest and become immediately
    due and payable;

 

    (B) the performance measurement period of all cash
    performance awards and performance share awards outstanding
    shall terminate on the last day of the month prior to the month
    in which the change in control occurs;

 

    (C) the participant shall be entitled to a cash or stock
    payment the amount of which shall be determined in accordance
    with the terms and conditions of the Plan and the appropriate
    cash performance award agreement and performance share award
    agreement, which amount shall be multiplied by a fraction, the
    numerator of which is the number of months in the performance
    measurement period which has passed prior to the change in
    control (as determined in accordance with clause (iii)(B) above)
    and the denominator of which is the total number of months in
    the original performance measurement period; and

 

    (D) the Continuing Directors (as defined in
    Article Fourteenth of the Corporation’s Certificate of
    Incorporation) shall promptly determine whether the participant
    is entitled to any performance award or performance share award,
    and any performance award payable shall be paid to the
    participant promptly but in no event more than five
    (5) days after a change in control;

 

    (iv) the Continuing Directors shall have the sole and
    complete authority and discretion to decide any questions
    concerning the application, interpretation or scope of any of
    the terms and conditions of any grant, award or participation
    under the Plan, and their decisions shall be binding and
    conclusive upon all interested parties; and

    

 

    (v) other than as set forth above, the terms and conditions
    of all grants and awards shall remain unchanged.

 

    (b) A “change in control” shall be deemed
    to have taken place upon the occurrence of any of the following
    events (capitalized terms are defined below):

 

    (i) any Person is or becomes the Beneficial Owner, directly
    or indirectly, of securities of the Corporation (not including
    in the securities beneficially owned by such Person any
    securities acquired directly from the Corporation or its
    Affiliates) representing 20% or more of either the then
    outstanding shares of common stock of the Corporation or the
    combined voting power of the Corporation’s then outstanding
    securities, excluding any Person who becomes such a Beneficial
    Owner in connection with a transaction described in
    clause (A) of paragraph (iii) below; or

 

    (ii) the following individuals cease for any reason to
    constitute a majority of the number of directors then serving:
    individuals who, on January 1, 2006, constituted the Board
    and any new director (other than a director whose initial
    assumption of office is in connection with an actual or
    threatened election contest, including but not limited to a
    consent solicitation, relating to the election of directors of
    the Corporation) whose appointment or election by the Board or
    nomination for election by the Corporation’s shareholders
    was approved or recommended by a vote of at least two-thirds
    (2/3) of the directors in office at the time of such approval or
    recommendation who either were directors on January 1, 2006
    or whose appointment, election or nomination for election was
    previously so approved or recommended; or

 

    (iii) there is consummated a merger or consolidation of the
    Corporation or any direct or indirect subsidiary of the
    Corporation with any other corporation, other than (A) any
    such merger or consolidation after the consummation of which the
    voting securities of the Corporation outstanding immediately
    prior to such merger or consolidation continue to represent
    (either by remaining outstanding or by being converted into
    voting securities of the surviving entity or any parent thereof)
    at least 50% of the combined voting power of the voting
    securities of the Corporation or such surviving entity or any
    parent thereof outstanding immediately after such merger or
    consolidation, or (B) any such merger or consolidation
    effected to implement a recapitalization of the Corporation (or
    similar transaction) in which no Person is or becomes the
    Beneficial Owner, directly or indirectly, of securities of the
    Corporation (not including in the securities Beneficially Owned
    by such Person any securities acquired directly from the
    Corporation or its Affiliates) representing 20% or more of
    either the then outstanding shares of common stock of the
    Corporation or the combined voting power of the
    Corporation’s then outstanding securities; or

 

    (iv) the shareholders of the Corporation approve a plan of
    complete liquidation or dissolution of the Corporation or there
    is consummated an agreement for the sale or disposition by the
    Corporation of all or substantially all of the
    Corporation’s assets, other than a sale or disposition by
    the Corporation of all or substantially all of the
    Corporation’s assets to an entity, at least 50% of the
    combined voting power of the voting securities of which are
    owned by shareholders of the Corporation in substantially the
    same proportions as their ownership of the Corporation
    immediately prior to such transaction or series of transactions.

 

    (v) Notwithstanding the foregoing, with respect to a cash
    performance award, performance share award, or any other award
    that is determined to be deferred compensation subject to the
    requirements of Section 409A of the Code, the Corporation
    will not be deemed to have undergone a change in control for the
    purposes of this Plan and with respect to any and all clauses of
    this Paragraph 41, unless the Corporation is deemed to have
    undergone a change in the ownership or effective control of the

    

 

    Corporation or in the ownership of a substantial portion of the
    assets of the Corporation (as such terms are defined in
    Section 409A of the Code and the Treasury regulations
    issued thereunder).

 

    (c) For purposes of this Paragraph 41, the following
    terms shall have the meanings indicated:

 

    (i) “Affiliate” shall have the meaning set
    forth in
    Rule 12b-2
    under Section 12 of the Exchange Act.

 

    (ii) “Beneficial Owner” shall have the
    meaning set forth in
    Rule 13d-3
    under the Exchange Act, except that a Person shall not be deemed
    to be the Beneficial Owner of any securities which are properly
    filed on a
    Form 13-F.

 

    (iii) “Exchange Act” shall mean the
    Securities Exchange Act of 1934, as amended from time to time.

 

    (iv) “Person” shall have the meaning given
    in Section 3(a)(9) of the Exchange Act, as modified and
    used in Sections 13(d) and 14(d) thereof, except that such
    term shall not include (i) the Corporation or any of its
    Affiliates, (ii) a trustee or other fiduciary holding
    securities under an employee benefit plan of the Corporation or
    any of its Affiliates, (iii) an underwriter temporarily
    holding securities pursuant to an offering of such securities or
    (iv) a corporation owned, directly or indirectly, by the
    shareholders of the Corporation in substantially the same
    proportions as their ownership of stock of the Corporation.

 

    42. Non-compete.

 

    (a) Any Early Retirement taken by any participant and the
    benefits thereof, as contemplated in Paragraphs 11, 21, 26
    and 30, unless such benefits are waived in writing by the
    participant, shall be subject to the provisions of this
    Paragraph 42. Any participant who is the beneficiary of any
    such Early Retirement shall be deemed to have expressly agreed
    not to compete with the Corporation or any subsidiary of the
    Corporation at which such participant was employed at any time
    in the three (3) years immediately prior to termination of
    employment, as the case may be, in the geographic area in which
    the Corporation or such subsidiary actively carried on business
    at the end of the participant’s employment there, for the
    period with respect to which such Early Retirement affords the
    participant enhanced benefits, which period shall be,
    (a) with respect to stock options or SSARs, the additional
    period allowed the participant for the vesting and exercise of
    options or SSARs outstanding at termination of employment,
    (b) with respect to restricted stock, the period remaining
    after the participant’s termination of employment until the
    end of the original restriction period for such restricted
    stock, and (c) with respect to cash performance awards and
    performance shares granted under the Plan, the period until the
    payment date following the end of the last applicable
    performance period.

 

    (b) In the event that a participant shall fail to comply
    with the provisions of this Paragraph 42, the Early
    Retirement shall be automatically rescinded and the participant
    shall forfeit the enhanced benefits referred to above and shall
    return to the Corporation the economic value theretofore
    realized by reason of such benefits as determined by the
    Committee. If the provisions of this Paragraph 42 or the
    corresponding provisions of a stock option, SSAR, restricted
    stock award, cash performance award agreement, or performance
    share award shall be unenforceable as to any participant, the
    Committee may rescind the benefits of any such Early Retirement
    with respect to such participant.

 

    (c) If any provision of this Paragraph 42, or the
    corresponding provisions of a stock option, SSAR, restricted
    stock award, cash performance award agreement, or performance
    share award is determined by a court to be unenforceable because
    of its scope in terms of geographic area or duration in time or
    otherwise, the Corporation and the participant agree that the
    court making such determination is specifically authorized to
    reduce the duration
    and/or
    geographical area
    and/or other

    

 

    scope of such provision and, in its reduced form, such provision
    shall then be enforceable; and in every case the remainder of
    this Paragraph 42, or the corresponding provisions of a
    stock option, SSAR, restricted stock award, cash performance
    award agreement, or performance share award shall not be
    affected thereby and shall remain valid and enforceable, as if
    such affected provision were not contained herein or therein.

 

    43. Interpretation.  The Committee shall
    have the sole and complete authority and discretion to decide
    any questions concerning the application, interpretation or
    scope of any of the terms and conditions of the Plan, stock
    option, SSAR, restricted stock award, cash performance award
    agreement, or performance share award entered into pursuant to
    the Plan, and its decisions shall be binding and conclusive upon
    all interested parties. Reference to any statute or regulation
    in the Plan shall mean such statute or regulation in effect from
    time to time and shall include any successor statute or
    regulation. For purposes of the Plan, the term
    “disability” or “disabled” shall have the
    meaning contained in Section 409A(a)(2) of the Code and the
    regulations promulgated thereunder. The Corporation reserves the
    right to make incentive or equity awards to Participants under
    other plans maintained by the Company or otherwise as determined
    by the Company in its sole discretion, which other plans or
    arrangements need not be intended to meet the requirements of
    Section 162(m) of the Code.

 

    44. Amendment.  Except as expressly
    provided in the next sentence, the Board of Directors may amend
    the Plan in any manner it deems necessary or appropriate
    (including any of the terms, conditions or definitions contained
    herein), or terminate the Plan at any time prior to
    January 31, 2015; provided, however, that any
    such termination will not affect the validity of any grants or
    awards previously made under the Plan, as the case may be.
    Without the approval of the Corporation’s shareholders, the
    Board of Directors cannot: (a) increase the maximum number
    of shares covered by the Plan or change the class of employees
    eligible to receive any grants or awards; (b) reduce the
    exercise price of any option or base price of a SSAR below the
    fair market value of the Common Stock on the date of the option
    or SSAR grant; (c) extend beyond 120 months from the
    date of the grant the period within which an option or SSAR may
    be exercised; or (d) make any other amendment to the Plan
    that would constitute a modification, revision or amendment
    requiring shareholder approval pursuant to any applicable law or
    regulation or rule of the Exchange.

 

    45. Effective Date and Termination Date of
    Plan.  The Plan became effective on
    February 1, 2005, and will terminate on January 31,
    2015, provided that no ISOs shall be granted under the
    Plan after February 11, 2014. No non-qualified stock
    options, SSARs, restricted stock, cash performance awards, or
    performance share awards shall be granted after January 31,
    2015. The amendments to the Plan adopted November 3, 2005
    and February 2, 2006 became effective January 1, 2006.
    The Plan was further amended effective January 1, 2009 to
    comply with the provisions of Sections 409A and 162(m) of
    the Code and applicable guidance issued by the Treasury
    Department and the Internal Revenue Service. The Plan is further
    amended effective January 1, 2009, subject to approval by
    the shareholders at the May 7, 2009 shareholders
    meeting.

 

    46. Foreign Jurisdictions.  The Committee
    may adopt, amend, and terminate such arrangements, not
    inconsistent with the intent of the Plan, as it may deem
    necessary or desirable to make available tax or other benefits
    of the laws of foreign jurisdictions to participants who are
    subject to such laws.

 

    47. Governing Law.  The Plan and all
    grants, options, SSARs, awards and payments made hereunder shall
    be governed by and interpreted in accordance with the laws of
    the State of New York.

 

    48. Special Rules for Specified
    Employees.  Notwithstanding any provision of the
    Plan to the contrary, upon the participant’s termination of
    employment for any reason other than death, if the Corporation
    determines that the participant is a “specified
    employee” (as determined by the Board or by such committee
    or other body as the Board shall delegate) and that an award
    constitutes

    

 

    “nonqualified deferred compensation” within the
    meaning of Section 409A, any payment of such award due
    within the six-month period after the participant’s
    termination of employment shall be made at the beginning of the
    seventh month following the date of termination of employment.
    The provisions of this Paragraph 48 shall only apply if
    required to comply with Section 409A of the Code. For the
    period from January 1, 2005 to December 31, 2008, the
    Plan was administered in good faith compliance with
    Section 409A of the Code and applicable guidelines issued
    by the Treasury Department and the Internal Revenue Service.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00158-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00158-of-00352.parquet"}]]