Document:

Exhibit 10.1

 

AMENDED
AND RESTATED

 

U-STORE-IT
TRUST

 

2007 EQUITY INCENTIVE PLAN

 

 

Table of
Contents

 

	
   

  	
  Tab No.

  
	
  Section 1.  Purpose

  	
  1

  
	
  Section 2.  Definitions

  	
  1

  
	
  Section 3.  Administration

  	
  7

  
	
  Section 4.  Shares Available For Awards

  	
  9

  
	
  Section 5.  Eligibility

  	
  10

  
	
  Section 6.  Stock Options And Share Appreciation Rights

  	
  10

  
	
  Section 7.  Restricted Shares And Restricted Share
  Units

  	
  12

  
	
  Section 8.  Performance Awards

  	
  14

  
	
  Section 9.  Other Share-Based Awards

  	
  15

  
	
  Section 10.  Non-Employee Trustee Awards

  	
  15

  
	
  Section 11.  Provisions Applicable To Covered Officers
  And Performance Awards

  	
  15

  
	
  Section 12.  Termination Of Employment

  	
  17

  
	
  Section 13.  Change In Control

  	
  17

  
	
  Section 14.  Amendment And Termination

  	
  17

  
	
  Section 15.  General Provisions

  	
  18

  
	
  Section 16.  Term Of The Plan

  	
  21

  

 

 

AMENDED AND RESTATED

U-STORE-IT TRUST

2007 EQUITY INCENTIVE PLAN

 

(As amended and restated effective June 2, 2010)

 

Section 1.              Purpose.  This plan
shall be known as the “Amended and Restated U-Store-It Trust 2007 Equity
Incentive Plan” (the “Plan”).  The
purpose of the Plan is to promote the interests of U-Store-It Trust, a Maryland
real estate investment trust (the “Company”), its Subsidiaries and its
shareholders by (i) attracting and retaining key officers, employees, and
trustees of, and consultants to, the Company and its Subsidiaries and
Affiliates; (ii) motivating such individuals by means of
performance-related incentives to achieve long-range performance goals; (iii) enabling
such individuals to participate in the long-term growth and financial success
of the Company; (iv) encouraging ownership of stock in the Company by such
individuals; and (v) linking their compensation to the long-term interests
of the Company and its shareholders. 
With respect to any awards granted under the Plan that are intended to
comply with the requirements of “performance-based compensation” under Section 162(m) of
the Code, the Plan shall be interpreted in a manner consistent with such
requirements.

 

Section 2.              Definitions.

 

(a)             Rules of
Construction.  As used in
this Plan: (i) unless otherwise specified, all defined terms in the
singular shall have comparable meanings when used in the plural and vice-versa;
(ii) all pronouns and any variations thereof shall be deemed to refer to
masculine, feminine or neuter, singular or plural, as the identity of the
Person or Persons may require; (iii) the words “include,” “includes” and “including”
will be deemed to be followed by the phrase “without limitation,” whether or
not such phrase is included therein; (iv) unless otherwise specified in
the computation of a period of time from a date to a later specified date, the
word “from” means “from and including,” and the words “to” and “until” each
mean “to but excluding”; and (v) references to all documents, contracts,
agreements or instruments shall include any and all supplements and amendments
thereto.

 

(b)             Definitions.  Subject to the provisions of Section 2(a) above,
all initially capitalized words and phrases used in this Plan have the
following meanings:

 

“Affiliate”
shall mean (i) any entity that, directly or indirectly, is controlled by
the Company, (ii) any entity in which the Company has a significant equity
interest, (iii) an affiliate of the Company, as defined in Rule 12b-2
promulgated under Section 12 of the Exchange Act, and (iv) any entity
in which the Company has at least twenty percent (20%) of the combined voting
power of the entity’s outstanding voting securities, including U-Store-It,
L.P., a Delaware limited partnership in each case as designated by the Board as
being a participating employer in the Plan.

 

“Annual Rate” means
the quotient of (i) divided by (ii) where:

 

 

(i)            is the number of Shares
subject to Awards granted in a calendar year; and

 

(ii)           is the sum of the number of
Shares and OP Units outstanding at the end of such calendar year.

 

For purposes of determining the number of
Shares subject to Awards granted in a calendar year under paragraph (i) above,
Shares underlying Full-Value Awards shall be taken into account as 1.5 Shares
and Shares underlying all other Awards shall be taken into account as 1.0
Shares.

 

“Award”
shall mean any Option, Share Appreciation Right, Restricted Share, Restricted
Share Unit, Performance Award, Other Share-Based Award or other award granted
under the Plan, whether singly, in combination or in tandem, to a Participant
by the Board pursuant to such terms, conditions, restrictions and/or
limitations, if any, as the Board may establish or that are required by
applicable legal requirements.

 

“Award
Agreement” shall mean any written agreement, contract or other instrument
or document evidencing any Award.

 

“Board”
shall mean the Board of Trustees of the Company.

 

“Cause”
shall mean, unless otherwise defined in the applicable Award Agreement, (i) the
engaging by the Participant in willful misconduct that is injurious to the
Company or its Subsidiaries or Affiliates, or (ii) the embezzlement or
misappropriation of funds or property of the Company or its Subsidiaries or
Affiliates by the Participant.  For
purposes of this paragraph, no act, or failure to act, on the Participant’s
part shall be considered “willful” unless done, or omitted to be done, by the
Participant not in good faith and without reasonable belief that the
Participant’s action or omission was in the best interest of the Company.  Any determination of Cause for purposes of
the Plan or any Award shall be made by the Board in its sole discretion.  Any such determination shall be final and
binding on a Participant.

 

“Change
in Control” shall mean, unless otherwise defined in the applicable Award
Agreement, any of the following events:

 

(i)            any person or entity,
including a “group” as defined in Section 13(d)(3) of the Exchange
Act, other than the Company or a wholly-owned subsidiary thereof or any
employee benefit plan of the Company or any of its Subsidiaries, becomes the
beneficial owner of the Company’s securities having 35% or more of the combined
voting power of the then outstanding securities of the Company that may be cast
for the election of Trustees of the Company (other than as a result of an
issuance of securities initiated by the Company in the ordinary course of
business);

 

(ii)           as the result of, or in
connection with, any cash tender or exchange offer, merger or other business
combination or contested election, or any combination of the foregoing
transactions, less than a majority of the combined voting power of the then
outstanding securities of the Company or any successor company or entity
entitled to vote generally in the election of the Trustees of the Company or
such other corporation or entity after such transaction are held in the
aggregate by the holders of the Company’s

 

2

 

securities entitled to vote
generally in the election of Trustees of the Company immediately prior to such
transaction;

 

(iii)          during any period of two (2) consecutive
years, individuals who at the beginning of any such period constitute the Board
cease for any reason to constitute at least a majority thereof, unless the election,
or the nomination for election by the Company’s shareholders, of each Trustee
of the Company first elected during such period was approved by a vote of at
least two-thirds (2/3rds) of the Trustees of the Company then still in office
who were (a) Trustees of the Company at the beginning of any such period,
and (b) not initially (1) appointed or elected to office as result of
either an actual or threatened election and/or proxy contest by or on behalf of
a Person other than the Board, or (2) designated by a Person who has
entered into an agreement with the Company to effect a transaction described in
(i) or (ii) above or (iv) or (v) below;

 

(iv)          a complete liquidation or
dissolution of the Company; or

 

(v)           the sale or other
disposition of all or substantially all of the assets of the Company to any
Person (other than a transfer to a Subsidiary).

 

“Code”
shall mean the Internal Revenue Code of 1986, as amended from time to time.

 

“Committee”
shall mean the Compensation Committee of the Board, which shall be composed of
not less than two Non-Employee Trustees, at least two of whom shall be (i) a
“non-employee director” for purposes of Section 16 and Rule 16b-3
promulgated thereunder, and (ii) an Outside Trustee, and each of whom
shall be “independent” within the meaning of the listing standards of the New
York Stock Exchange.

 

“Company” shall have the meaning set forth in Section 1
above.

 

“Consultant”
shall mean any consultant to the Company or its Subsidiaries or Affiliates.

 

“Covered
Officer” shall mean at any date (i) any individual who, with respect
to the previous taxable year of the Company, was a “covered employee” of the
Company within the meaning of Section 162(m); provided, however, that the
term “Covered Officer” shall not include any such individual who is designated
by the Board, in its discretion, at the time of any Award or at any subsequent
time, as reasonably expected not to be such a “covered employee” with respect
to the current taxable year of the Company and (ii) any individual who is
designated by the Board, in its discretion, at the time of any Award or at any
subsequent time, as reasonably expected to be such a “covered employee” with
respect to the current taxable year of the Company or with respect to the
taxable year of the Company in which any applicable Award will be paid or
vested.

 

“Disability”
shall mean, unless otherwise defined in the applicable Award Agreement, a
disability that would qualify as a total and permanent disability under the
Company’s then current long-term disability plan.

 

3

 

“Employee” shall mean
a current or prospective officer or employee of the Company or of any
Subsidiary or Affiliate.

 

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

 

“Fair
Market Value” with respect to the Shares, shall mean, for purposes of a
grant of an Award as of any date, (i) the closing sales price of the
Shares on the New York Stock Exchange, or any other exchange on which the
shares are traded, on such date, or in the absence of reported sales on such
date, the closing sales price on the immediately preceding date on which sales
were reported or (ii) in the event there is no public market for the
Shares on such date, the fair market value as determined, in good faith, by the
Board in its sole discretion.

 

“Family Member” means a person who is a spouse, former spouse,
child, stepchild, grandchild, parent, stepparent, grandparent, niece, nephew,
mother-in-law, father-in-law, son-in-law, daughter-in-law, brother, sister,
brother-in-law, or sister-in-law, including adoptive relationships, of the
grantee, any person sharing the grantee’s household (other than a tenant or
employee), a trust in which any one or more of these persons have more than
fifty percent (50%) of the beneficial interest, a foundation in which any one
or more of these persons (or the grantee) control the management of assets, and
any other entity in which one or more of these persons (or the grantee) own
more than fifty percent (50%) of the voting interests.

 

“Full-Value Award” means an Award other than an Option or Share
Appreciation Right.

 

“Fungible Pool Unit” shall be the measuring unit used for
purposes of the Plan, as specified in Section 4, to determine the number
of Shares which may be subject to Awards hereunder, which shall consist of
Shares in the proportions (ranging from 1.0 to 1.66) as set forth in Section 4.

 

“Incentive
Stock Option” shall mean an option to purchase Shares from the Company that
is granted under Section 6 of the Plan and that is intended to meet the
requirements of Section 422 of the Code or any successor provision
thereto.

 

“Non-Qualified
Stock Option” shall mean an option to purchase Shares from the Company that
is granted under Section 6 or 10 of the Plan and is not intended to be an
Incentive Stock Option.

 

“Non-Employee
Trustee” shall mean a member of the Board who is not an officer or employee
of the Company or any Subsidiary or Affiliate.

 

“OP Units” means units of limited partnership interest in U-Store-It,
L.P. that are exchangeable or convertible into Shares.

 

“Option”
shall mean an Incentive Stock Option or a Non-Qualified Stock Option.

 

“Option
Price” shall mean the purchase price payable to purchase one Share upon the
exercise of an Option.

 

4

 

“Other
Share-Based Award” shall mean any Award granted under Section 9 or 10
of the Plan.

 

“Outside Trustee” means a Trustee who either (i) is not a
current employee of the Company or an “affiliated corporation” (within the
meaning of Treasury Regulations promulgated under Section 162(m) of
the Code), is not a former employee of the Company or an “affiliated
corporation” receiving compensation for prior services (other than benefits
under a tax-qualified pension plan), was not an officer of the Company or an “affiliated
corporation” at any time and is not currently receiving direct or indirect
remuneration from the Company or an “affiliated corporation” for services in
any capacity other than as a Trustee; or (ii) is otherwise considered an “outside
director” for purposes of Section 162(m) of the Code.

 

“Participant”
shall mean any Employee, Trustee, Consultant or other person who receives an
Award under the Plan.

 

“Performance
Award” shall mean any Award granted under Section 8 of the Plan.

 

“Person”
shall mean any individual, corporation, partnership, limited liability company,
association, joint-stock company, trust, unincorporated organization,
government or political subdivision thereof or other entity.

 

“Plan” has the meaning set forth in the Section 1
above.

 

“Restricted
Share” shall mean any Share granted under Section 7 or 10 of the Plan.

 

“Restricted
Share Unit” shall mean any unit granted under Section 7 or 10 of the
Plan.

 

“Retirement”
shall mean, unless otherwise defined in the applicable Award Agreement,
retirement of a Participant from the employ or service of the Company or any of
its Subsidiaries or Affiliates in accordance with the terms of the applicable
Company retirement plan or, if a Participant is not covered by any such plan,
retirement on or after such Participant’s 65th birthday.

 

“SEC”
shall mean the Securities and Exchange Commission or any successor thereto.

 

“Section 16”
shall mean Section 16 of the Exchange Act and the rules promulgated
thereunder and any successor provision thereto as in effect from time to time.

 

“Section 162(m)”
shall mean Section 162(m) of the Code and the regulations promulgated
thereunder and any successor provision thereto as in effect from time to time.

 

“Shares”
shall mean shares of the common shares, $0.01 par value, of the Company.

 

“Share
Appreciation Right”  or “SAR”
shall mean a share appreciation right granted under Section 6 or 10 of the
Plan that entitles the holder to receive, with respect to each Share
encompassed by the exercise of such SAR, the excess of the Fair Market Value on
the date of exercise over the amount determined by the Board and specified in
an Award Agreement as the

 

5

 

exercise price of such SAR,
provided that the exercise price shall not be less than the Fair Market Value
on the date of grant.

 

“Subsidiary”
shall mean any Person (other than the Company) of which a majority of its
voting power or its equity securities or equity interest is owned directly or
indirectly by the Company.

 

“Substitute
Awards” shall mean Awards granted solely in assumption of, or in
substitution for, outstanding awards previously granted by a company acquired
by the Company or with which the Company combines.

 

“Target Rate” means the greater of (i) 2% or (ii) the
mean of the Company’s GICS peer group for the three-year period beginning January 1,
2010 and ending December 31, 2012.

 

“Three-Year Average
Annual Rate” means the average of the Annual Rates for calendar years 2010,
2011 and 2012.

 

“Trustee”
shall mean a member of the Board.

 

6

 

Section 3.              Administration.

 

(a)             The Board.  The Board shall have such powers and
authorities related to the administration of the Plan as are consistent with
the Company’s governing documents and applicable law. The Board shall have full
power and authority to take all actions and to make all determinations required
or provided for under the Plan, any Award or any Award Agreement, and shall
have full power and authority to take all such other actions and make all such
other determinations not inconsistent with the specific terms and provisions of
the Plan that the Board deems to be necessary or appropriate for the
administration of the Plan, any Award or any Award Agreement. All such actions
and determinations shall be by the affirmative vote of a majority of the
members of the Board present at a meeting or by unanimous consent of the Board
executed in writing in accordance with the Company’s governing documents and
applicable law. The interpretation and construction by the Board of any
provision of the Plan, any Award or any Award Agreement shall be final, binding
and conclusive. Notwithstanding any other provision of the Plan, the Board
shall not take any action or make any Awards hereunder that could cause the
Company to fail to qualify as a real estate investment trust for Federal income
tax purposes.

 

(b)             Delegation to
Committee.

 

(i)            General. The Board may
delegate all or part of the administration of the Plan to the Committee. If
administration is delegated to the Committee, the Committee shall have, in
connection with the administration of the Plan, the powers theretofore
possessed by the Board, including the power to delegate to a subcommittee any
of the administrative powers the Committee is authorized to exercise (and
references in this Plan to the Board shall thereafter be to the Committee or
subcommittee), subject, however, to such resolutions, not inconsistent with the
provisions of the Plan, as may be adopted from time to time by the Board. The
Board may abolish the Committee at any time and revest in the Board the
administration of the Plan.

 

(ii)           Section 162(m) and
Rule 16b-3 Compliance.  The Board or the Committee shall (A) delegate
to a committee of two or more members of the Board who are Outside Directors
the authority to grant Awards to eligible persons who are either (1) Covered
Officers and are expected to be Covered Officers at the time of recognition of
income resulting from such Award or (2) persons with respect to whom the
Company wishes to comply with Section 162(m) of the Code and/or (B) delegate
to a committee of two or more members of the Board who are Non-Employee
Directors the authority to grant Awards to eligible persons who are then
subject to Section 16 of the Exchange Act.

 

(c)           Subject to the
terms of the Plan and applicable law, and in addition to other express powers
and authorizations conferred on the Board by the Plan, the Board shall have
full power and authority in its discretion to:

 

(i)            designate Participants;

 

(ii)           determine the type or types
of Awards to be granted to a Participant;

 

7

 

(iii)          determine the number of
Shares to be covered by, or with respect to which payments, rights or other
matters are to be calculated in connection with Awards;

 

(iv)          determine the timing, terms,
and conditions of any Award;

 

(v)           accelerate the time at which
all or any part of an Award may be settled or exercised;

 

(vi)          determine whether, to what
extent, and under what circumstances, Awards may be settled or exercised in
cash, Shares, other securities, other Awards or other property, or canceled,
forfeited or suspended and the method or methods by which Awards may be
settled, exercised, canceled, forfeited or suspended;

 

(vii)         determine whether, to what
extent, and under what circumstances cash, Shares, other securities, other
Awards, other property, and other amounts payable with respect to an Award
shall be deferred either automatically or at the election of the holder thereof
or of the Board;

 

(viii)        interpret and administer the
Plan and any instrument or agreement relating to, or Award made under, the Plan;

 

(ix)           except to the extent
prohibited by Section 6(b), amend or modify the terms of any Award
at or after grant with the consent of the holder of the Award;

 

(x)            establish, amend, suspend or
waive such rules and regulations and appoint such agents as it shall deem
appropriate for the proper administration of the Plan; and

 

(xi)           make any other determination
and take any other action that the Board deems necessary or desirable for the
administration of the Plan.

 

The exercise of an Option or
receipt of an Award shall be effective only if an Award Agreement shall have
been duly executed and delivered on behalf of the Company following the grant
of an Award.

 

(d)           Discretion
Binding. 
Unless otherwise expressly provided in the Plan, all designations,
determinations, interpretations, and other decisions under or with respect to
the Plan or any Award shall be within the sole discretion of the Board, may be
made at any time and shall be final, conclusive, and binding upon all Persons,
including the Company, any Subsidiary or Affiliate, any Participant and any
holder or beneficiary of any Award.

 

(e)           Delegation.  Subject to the terms of the
Plan, the Board may delegate to one or more officers or managers of the Company
or of any Subsidiary or Affiliate, or to a committee of such officers or
managers, the authority, subject to such terms and limitations as the Board
shall determine, to grant Awards to or to cancel, modify or waive rights with
respect to, or to alter, discontinue, suspend or terminate Awards held by Participants
who are not officers

 

8

 

or
trustees of the Company for purposes of Section 16 or who are
otherwise not subject to such Section.

 

Section 4.              Shares Available For Awards.

 

(a)             Shares
Available.  Subject to
the additional limitation as provided in Section 4(c) and the
adjustments as provided in Section 4(d), the total number of Shares
subject to Awards granted under the Plan, in the aggregate, may not exceed
8,500,000.  Of this amount, the “Fungible
Pool Limit” shall equal the sum of (i) the 4,600,000 Shares added as of
the Restatement Effective Date, plus (ii) any Shares remaining available
for issuance under the Plan as of the Restatement Effective Date, plus (iii) any
Shares subject to Awards under the Plan as of the Restatement Effective Date
that are later forfeited or for any other reason are not payable under the
Plan.  Each Share issued or subject to
issuance out of the Fungible Pool Limit on or after the Restatement Effective
Date under a Full-Value Award shall be counted against the Fungible Pool Limit
as 1.66 Fungible Pool Units.  Options and
Share Appreciation Rights for Shares subject to issuance out of the Fungible
Pool Limit on or after the Restatement Effective Date shall be counted against
the Fungible Pool Limit as 1.0 Fungible Pool Unit.  (For these purposes, the number of Shares
taken into account with respect to a Share Appreciation Right shall be the
number of Shares underlying the Share Appreciation Rights at grant (i.e., not the
final number of Shares delivered upon exercise of the Share Appreciation
Rights).)  Notwithstanding the foregoing
and subject to adjustment as provided in Section 4(d), for any
calendar year, no Participant may receive Awards for Fungible Share Units in
excess of 1,000,000 Fungible Share Units, provided that such limit shall not
apply to Awards granted in 2010 before the Restatement Effective Date.

 

(b)             Effect of the
Expiration or Termination of Awards; Other Adjustments to Fungible Pool Limit.

 

(i)            Shares that have been
granted on or after the Restatement Effective Date but are later forfeited or
for any other reason are not payable under the Plan may again be made the
subject of Awards under the Plan, and shall be restored to the Fungible Pool
Limit on the same basis as offset under the rules stated in Section 4(a).
All other Shares that have been granted but are later forfeited or for any
other reason are not payable under the Plan may again be made the subject of
Awards under the Plan, and shall be restored to the Fungible Pool Limit on a
one-for-one basis.

 

(ii)           If the Company withholds
Shares to satisfy tax withholding requirements in connection with the exercise,
vesting or payment of an award, other awards may not be granted covering the
Shares so withheld to satisfy the tax withholding requirement.  If a Participant exercises an Option covering
Shares via the delivery of Shares to pay the option exercise price or a
Participant exercises an SAR that is settled in Shares, other awards may not be
granted with respect to the total number of Shares with respect to which such
exercise applies, including those not delivered because of the net share
settlement of the award.

 

(c)             Additional
Limitation.  At the end
of 2012, the Three-Year Average Annual Rate shall not exceed the Target
Rate.  For the avoidance of doubt, the
Annual Rate in

 

9

 

any
one year during such three-year period may exceed the Target Rate, provided that the Three-Year Average
Annual Rate does not exceed the Target Rate.

 

(d)             Adjustments.  In the event that any
dividend or other distribution (whether in the form of cash, Shares, other
securities or other property), recapitalization, stock split, reverse stock
split, reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase or exchange of Shares or other securities of the Company, issuance
of warrants or other rights to purchase Shares or other securities of the
Company, or other similar corporate transaction or event affects the Shares,
then the Board will in an equitable and proportionate manner (and, as
applicable, in such manner as is consistent with Sections 422 and 409A of
the Code and the regulations thereunder and with Section 162(m)) either: (i) adjust
any or all of (1) the aggregate number of Shares or other securities of
the Company (or number and kind of other securities or property) with respect
to which Awards may be granted under the Plan; (2) the number of Shares or
other securities of the Company (or number and kind of other securities or
property) subject to outstanding Awards under the Plan, provided that the
number of shares subject to any Award shall always be a whole number; (3) the
grant or exercise price with respect to any Award under the Plan; and (4) the
limits on the number of Shares that may be granted to Participants under the
Plan in any calendar year; (ii) provide for an equivalent award in respect
of securities of the surviving entity of any merger, consolidation or other
transaction or event having a similar effect; or (iii)  make provision for
a cash payment to the holder of an outstanding Award.

 

(e)             Substitute
Awards.  Any Shares issued by the Company as
Substitute Awards in connection with the assumption or substitution of
outstanding grants from any acquired corporation shall not reduce the Shares
available for Awards under the Plan.

 

(f)              Sources of
Shares Deliverable Under Awards.  Any Shares delivered
pursuant to an Award may consist, in whole or in part, of authorized and
unissued Shares or of issued Shares which have been reacquired by the Company.

 

Section 5.              Eligibility.  Any
Employee, Trustee or Consultant shall be eligible to be designated a
Participant; provided, however, that Non-Employee Trustees shall only be
eligible to receive Awards granted consistent with Section 10.

 

Section 6.              Stock Options And Share Appreciation Rights.

 

(a)             Grant.  Subject to the provisions of
the Plan including, without limitation, Section 3(c) above and
other applicable legal requirements, the Board shall have sole and complete
authority to determine the Participants to whom Options and SARs shall be
granted, the number of Shares subject to each Award, the exercise price and the
conditions and limitations applicable to the exercise of each Option and SAR.  An Option may be granted with or without a
related SAR.  A SAR may be granted with
or without a related Option.  The Board
shall have the authority to grant Incentive Stock Options, and to grant
Non-Qualified Stock Options.  In the case
of Incentive Stock Options, the terms and conditions of such grants shall be
subject to and comply with Section 422 of the Code, as from time to time
amended, and any regulations implementing such statute.  A person who has been granted an Option or
SAR under this Plan may be granted additional Options or SARs under the Plan if
the Board shall so determine;

 

10

 

provided,
however, that to the extent the aggregate Fair Market Value (determined at the
time the Incentive Stock Option is granted) of the Shares with respect to which
all Incentive Stock Options are exercisable for the first time by an Employee
during any calendar year (under all plans described in Section 422(d) of
the Code of the Employee’s employer corporation and its parent and
Subsidiaries) exceeds $100,000, such Options shall be treated as Non-Qualified
Stock Options.

 

(b)             Price.  The Board in its sole
discretion shall establish the Option Price at the time each Option is
granted.  Except in the case of Substitute
Awards, the Option Price of an Option may not be less than one hundred percent
(100%) of the Fair Market Value of the Shares with respect to which the Option
is granted on the date of grant of such Option. 
Notwithstanding the foregoing and except as permitted by the provisions
of Section 4(c) and Section 14, the Board shall
not have the power to (i) amend the terms of previously granted Options to
reduce the Option Price of such Options, or (ii) cancel such Options and
grant substitute Options with a lower Option Price than the cancelled
Options.  Except with respect to
Substitute Awards, SARs may not be granted at a price less than the Fair Market
Value of a Share on the date of grant.

 

(c)             Term.  Subject to the Board’s
authority under Section 3(a) and the provisions of Section 6(e),
each Option and SAR and all rights and obligations thereunder shall expire on
the date determined by the Board and specified in the Award Agreement.  The Board shall be under no duty to provide
terms of like duration for Options or SARs granted under the Plan.  Notwithstanding the foregoing, no Option or
SAR shall be exercisable after the expiration of ten (10) years from the
date such Option or SAR was granted.

 

(d)             Exercise.

 

(i)            Each Option and SAR shall be
exercisable at such times and subject to such terms and conditions as the Board
may, in its sole discretion, specify in the applicable Award Agreement or
thereafter.  The Board shall have full
and complete authority to determine, subject to Section 6(e),
whether an Option or SAR will be exercisable in full at any time or from time
to time during the term of the Option or SAR, or to provide for the exercise
thereof in such installments, upon the occurrence of such events and at such
times during the term of the Option or SAR as the Board may determine.

 

(ii)           The Board may impose such
conditions with respect to the exercise of Options, including without
limitation, any relating to the application of federal, state or foreign
securities laws or the Code, as it may deem necessary or advisable.  The exercise of any Option granted pursuant
to this Plan shall be effective only at such time as the sale of Shares
pursuant to such exercise will not violate any state or federal securities or
other laws.

 

(iii)          An Option or SAR may be
exercised in whole or in part at any time, with respect to whole Shares only,
within the period permitted thereunder for the exercise thereof, and shall be
exercised by written notice of intent to exercise the Option or SAR, delivered
to the Company at its principal office, and payment in full to the

 

11

 

Company at the direction of
the Board of the amount of the Option Price for the number of Shares with
respect to which the Option is then being exercised.

 

(iv)          Payment of the Option Price
shall be made in cash or cash equivalents, or, at the discretion of the Board, (A) by
transfer, either actually or by attestation, to the Company of Shares that have
been held by the Participant for at least six (6) months (or such lesser
period as may be permitted by the Board), valued at the Fair Market Value of
such Shares on the date of exercise (or next succeeding trading date, if the
date of exercise is not a trading date), together with any applicable
withholding taxes, such transfer to be upon such terms and conditions as
determined by the Board, or (B) by a combination of such cash (or cash
equivalents) and such Shares; provided, however, that the optionee shall not be
entitled to tender Shares pursuant to successive, substantially simultaneous
exercises of an Option or any other stock option of the Company.  Subject to applicable securities laws, an
Option may also be exercised by delivering a notice of exercise of the Option and
simultaneously selling the Shares thereby acquired, pursuant to a brokerage or
similar agreement approved in advance by proper officers of the Company, using
the proceeds of such sale as payment of the Option Price, together with any
applicable withholding taxes.  Until the
optionee has been issued the Shares subject to such exercise, he or she shall
possess no rights as a shareholder with respect to such Shares.

 

(v)           At the Board’s discretion,
the amount payable as a result of the exercise of an SAR may be settled in
cash, Shares or a combination of cash and Shares.  A fractional Share shall not be deliverable
upon the exercise of a SAR but a cash payment will be made in lieu thereof.

 

(e)             Ten Percent
Stock Rule. 
Notwithstanding any other provisions in the Plan, if at the time an
Option is otherwise to be granted pursuant to the Plan, the optionee or rights
holder owns directly or indirectly (within the meaning of Section 424(d) of
the Code) Shares of the Company possessing more than ten percent (10%) of the
total combined voting power of all classes of stock of the Company or its
parent or Subsidiary or Affiliate corporations (within the meaning of Section 422(b)(6) of
the Code), then any Incentive Stock Option to be granted to such optionee or
rights holder pursuant to the Plan shall satisfy the requirement of Section 422(c)(5) of
the Code, and the Option Price shall be not less than one hundred ten percent
(110%) of the Fair Market Value of the Shares of the Company, and such
Incentive Stock Option by its terms shall not be exercisable after the
expiration of five (5) years from the date such Incentive Stock Option is
granted.

 

Section 7.              Restricted Shares And Restricted Share Units.

 

(a)             Grant.

 

(i)            Subject to the provisions of
the Plan and other applicable legal requirements, the Board shall have sole and
complete authority to determine the Participants to whom Restricted Shares and
Restricted Share Units shall be granted, the number of Restricted Shares and/or
the number of Restricted Share Units to be granted to each Participant, the
duration of the period during which, and the conditions under which,

 

12

 

the Restricted Shares and
Restricted Share Units may be forfeited to the Company, and the other terms and
conditions of such Awards.  The Restricted
Share and Restricted Share Unit Awards shall be evidenced by Award Agreements
in such form as the Board shall from time to time approve, which agreements
shall comply with and be subject to the terms and conditions of this Plan and
any additional terms and conditions established by the Board that are
consistent with the terms of the Plan.

 

(ii)           Each Restricted Share and
Restricted Share Unit Award made under the Plan shall be for such number of
Shares as shall be determined by the Board and set forth in the Award Agreement
containing the terms of such Restricted Share or Restricted Share Unit
Award.  Such agreement shall set forth a
period of time during which the Participant must remain in the continuous employment
of the Company in order for the forfeiture and transfer restrictions to
lapse.  If the Board so determines, the
restrictions may lapse during such restricted period in installments with
respect to specified portions of the Shares covered by the Restricted Share or
Restricted Share Unit Award.  The Award
Agreement may also, in the discretion of the Board, set forth performance or
other conditions that will subject the Shares to forfeiture and transfer
restrictions.  The Board may, at its
discretion, waive all or any part of the restrictions applicable to any or all
outstanding Restricted Share and Restricted Share Unit Awards.

 

(b)             Delivery of
Shares and Transfer Restrictions.  At the time of a Restricted
Share Award, a certificate representing the number of Shares awarded thereunder
shall be registered in the name of the Participant.  Such certificate shall be held by the Company
or any custodian appointed by the Company for the account of the Participant
subject to the terms and conditions of the Plan, and shall bear such a legend
setting forth the restrictions imposed thereon as the Board, in its discretion,
may determine.  The applicable Award
Agreement will specify whether a Participant has the right to receive dividends
with respect to the Restricted Shares prior to the lapsing of transfer
restrictions. Unless otherwise provided in the applicable Award Agreement, the
grantee shall have all other rights of a shareholder with respect to the
Restricted Shares, including the right to vote such Shares, subject to the
following restrictions: (i) the Participant shall not be entitled to
delivery of the stock certificate until the expiration of the restricted period
and the fulfillment of any other restrictive conditions set forth in the Award
Agreement with respect to such Shares; (ii) none of the Shares may be
sold, assigned, transferred, pledged, hypothecated or otherwise encumbered or
disposed of during such restricted period or until after the fulfillment of any
such other restrictive conditions; and (iii) except as otherwise
determined by the Board at or after grant, all of the Shares shall be forfeited
and all rights of the Participant to such Shares shall terminate, without
further obligation on the part of the Company, unless the grantee remains in
the continuous employment of the Company for the entire restricted period in
relation to which such Shares were granted and unless any other restrictive
conditions relating to the Restricted Share Award are met.  Unless otherwise provided in the applicable Award
Agreement, any Shares, any other securities of the Company and any other
property (except for cash dividends) distributed with respect to the Shares
subject to Restricted Share Awards shall be subject to the same restrictions,
terms and conditions as such Restricted Shares.

 

(c)             Termination of
Restrictions. 
At the end of the restricted period and provided that any other
restrictive conditions of the Restricted Share Award are met, or at such

 

13

 

earlier
time as otherwise determined by the Board, all restrictions set forth in the
Award Agreement relating to the Restricted Share Award or in the Plan shall
lapse as to the Restricted Shares subject thereto, and a stock certificate for
the appropriate number of Shares, free of the restrictions and restricted stock
legend, shall be delivered to the Participant or the Participant’s beneficiary
or estate, as the case may be.

 

(d)             Payment of
Restricted Share Units.  Each Restricted Share Unit
shall have a value equal to the Fair Market Value of a Share.  Restricted Share Units shall be paid in cash,
Shares, other securities or other property, as determined in the sole
discretion of the Board, upon the lapse of the restrictions applicable thereto,
or otherwise in accordance with the applicable Award Agreement.  The applicable Award Agreement will specify
whether a Participant will be entitled to receive dividend rights in respect of
Restricted Share Units at the time of any payment of dividends to shareholders
on Shares.  If the applicable Award
Agreement specifies that a Participant will be entitled to receive dividend
rights, (i) the amount of any such dividend right shall equal the amount
that would be payable to the Participant as a shareholder in respect of a
number of Shares equal to the number of Restricted Share Units then credited to
the Participant, (ii) any such dividend right shall be paid in accordance
with the Company’s payment practices as may be established from time to time
and as of the date on which such dividend would have been payable in respect of
outstanding Shares, and (iii) the applicable Award Agreement will specify
whether dividend equivalents shall be paid in respect of Restricted Share Units
that are not yet vested.  Except as
otherwise determined by the Board at or after grant, Restricted Share Units may
not be sold, assigned, transferred, pledged, hypothecated or otherwise
encumbered or disposed of, and all Restricted Share Units and all rights of the
grantee to such Restricted Share Units shall terminate, without further obligation
on the part of the Company, unless the Participant remains in continuous
employment of the Company for the entire restricted period in relation to which
such Restricted Share Units were granted and unless any other restrictive
conditions relating to the Restricted Share Unit Award are met.

 

Section 8.              Performance Awards.

 

(a)             Grant.  The Board shall have sole
and complete authority to determine the Participants who shall receive a
Performance Award, which shall consist of a right that is (i) denominated
in cash or Shares (including but not limited to Restricted Shares and
Restricted Share Units), (ii) valued, as determined by the Board, in
accordance with the achievement of such performance goals during such
performance periods as the Board shall establish, and (iii) payable at
such time and in such form as the Board shall determine.

 

(b)             Terms and
Conditions. 
Subject to the terms of the Plan and any applicable Award Agreement,
the Board shall determine the performance goals to be achieved during any performance
period, the length of any performance period, the amount of any Performance
Award and the amount and kind of any payment or transfer to be made pursuant to
any Performance Award, and may amend specific provisions of the Performance
Award; provided, however, that such amendment may not adversely affect existing
Performance Awards made within a performance period commencing prior to
implementation of the amendment.

 

(c)             Payment of
Performance Awards.  Performance Awards may be
paid in a lump sum or in installments following the close of the performance
period or, in accordance with

 

14

 

the
procedures established by the Board, on a deferred basis.  Termination of employment prior to the end of
any performance period, other than for reasons of death or Disability, will
result in the forfeiture of the Performance Award, and no payments will be
made.  A Participant’s rights to any
Performance Award may not be sold, assigned, transferred, pledged, hypothecated
or otherwise encumbered or disposed of in any manner, except by will or the
laws of descent and distribution, and/or except as the Board may determine at
or after grant.

 

Section 9.              Other Share-Based Awards.  The Board shall have the authority to determine
the Participants who shall receive an Other Share-Based Award, which shall
consist of any right that is (i) not an Award described in Section 6
or Section 7 above and (ii) an Award of Shares or an Award
denominated or payable in, valued in whole or in part by reference to, or
otherwise based on or related to, Shares (including, without limitation,
securities convertible into Shares), as deemed by the Board to be consistent
with the purposes of the Plan.  Subject
to the terms of the Plan and any applicable Award Agreement, the Board shall
determine the terms and conditions of any such Other Share-Based Award.

 

Section 10.            Non-Employee Trustee Awards.  The Board may provide that all or a portion
of a Non-Employee Trustee’s annual retainer, meeting fees and/or other awards
or compensation as determined by the Board, be payable (either automatically or
at the election of a Non-Employee Trustee) in the form of Non-Qualified Stock
Options, Restricted Shares, Restricted Share Units and/or Other Share-Based
Awards, including unrestricted Shares. 
The Board shall determine the terms and conditions of any such Awards,
including the terms and conditions which shall apply upon a termination of the
Non-Employee Trustee’s service as a member of the Board, and shall have full
power and authority in its discretion to administer such Awards, subject to the
terms of the Plan and applicable law. 
Subject to applicable legal requirements, the Board may also grant
Awards to Non-Employee Trustees pursuant to the terms of the Plan, including
any Award described in Section 6, Section 7 or Section 9
above.

 

Section 11.            Provisions Applicable To Covered Officers And Performance Awards.

 

(a)              Notwithstanding
anything in the Plan to the contrary, unless the Board determines that a
Performance Award to be granted to a Covered Officer should not qualify as “performance-based
compensation” for purposes of Section 162(m), Performance Awards granted
to Covered Officers shall be subject to the terms and provisions of this Section 11.  Accordingly, unless otherwise determined by
the Board, if any provision of the Plan or any Award Agreement relating to such
an Award does not comply or is inconsistent with Section 162(m), such
provision shall be construed or deemed amended to the extent necessary to
conform to such requirements, and no provision shall be deemed to confer upon
the Board discretion to increase the amount of compensation otherwise payable
to a Covered Officer in connection with any such Award upon the attainment of
the performance criteria established by the Board.

 

(b)             The Board may
grant Performance Awards to Covered Officers based solely upon the attainment
of performance targets related to one or more performance goals selected by the
Board from among the goals specified below. 
For the purposes of this Section 11, performance goals shall
be limited to one or more of the following Company, Subsidiary, operating unit,
business segment or division financial performance measures:

 

15

 

(i)            Funds from Operations or
Adjusted Funds from Operations;

 

(ii)           operating income or profit;

 

(iii)          operating efficiencies;

 

(iv)          return on equity, assets,
capital, capital employed or investment;

 

(v)           net income;

 

(vi)          earnings per share;

 

(vii)         utilization;

 

(viii)        gross profit;

 

(ix)          stock price or total
shareholder return;

 

(x)           net asset growth;

 

(xi)          debt reduction;

 

(xii)         strategic business
objectives, consisting of one or more objectives based on meeting specified
cost targets, business expansion goals and goals relating to acquisitions or
divestitures; or

 

(xiii)        any combination thereof.

 

Each goal may be expressed on an absolute
and/or relative basis, may be based on or otherwise employ comparisons based on
internal targets, the past performance of the Company or any Subsidiary,
operating unit, business segment or division of the Company and/or the past or
current performance of other companies, and in the case of earnings-based
measures, may use or employ comparisons relating to capital, shareholders’
equity and/or Shares outstanding, or to assets or net assets.  The Board may appropriately adjust any
evaluation of performance under criteria set forth in this Section 11(b) to
exclude any of the following events that occurs during a performance period:  (i) asset write-downs, (ii) litigation
or claim judgments or settlements, (iii) the effect of changes in tax law,
accounting principles or other such laws or provisions affecting reported
results, (iv) accruals for reorganization and restructuring programs and (v) any
extraordinary non-recurring items as described in Accounting Principles Board
Opinion No. 30 and/or in management’s discussion and analysis of financial
condition and results of operations appearing in the Company’s annual report to
shareholders for the applicable year.

 

(c)              To the extent
necessary to comply with Section 162(m), with respect to grants of
Performance Awards, no later than 90 days following the commencement of
each performance period (or such other time as may be required or permitted by Section 162(m) of
the Code), the Board shall, in writing, (1) select the performance goal or
goals applicable to the performance period, (2) establish the various
targets and bonus amounts which may be earned for such performance period, and (3) specify
the relationship between performance goals and

 

16

 

targets
and the amounts to be earned by each Covered Officer for such performance
period.  Following the completion of each
performance period, the Board shall certify in writing whether the applicable
performance targets have been achieved and the amounts, if any, payable to
Covered Officers for such performance period. 
In determining the amount earned by a Covered Officer for a given performance
period, subject to any applicable Award Agreement, the Board shall have the
right to reduce (but not increase) the amount payable at a given level of
performance to take into account additional factors that the Board may deem
relevant in its sole discretion to the assessment of individual or corporate
performance for the performance period.

 

Section 12.            Termination Of Employment.  The Board shall have the full power and
authority to determine the terms and conditions that shall apply to any Award
upon a termination of employment with the Company, its Subsidiaries and
Affiliates, including a termination by the Company with or without Cause, by a
Participant voluntarily, or by reason of death, Disability or Retirement, and
may provide such terms and conditions in the Award Agreement or in such rules and
regulations as it may prescribe.

 

Section 13.            Change In Control.  The Board may specify in the applicable Award
Agreement at or after grant, or otherwise by resolution prior to a Change in
Control, that all or a portion of the outstanding Awards shall vest, become
immediately exercisable or payable and have all restrictions lifted upon a
Change in Control.

 

Section 14.            Amendment And Termination.

 

(a)              Amendments to
the Plan. 
The Board may amend, alter, suspend, discontinue or terminate the Plan
or any portion thereof at any time; provided that no such amendment,
alteration, suspension, discontinuation or termination shall be made without
shareholder approval if such approval is necessary to comply with any tax or
regulatory requirement for which or with which the Board deems it necessary or
desirable to comply, and provided further, that no amendment that shall
increase the Fungible Share Pool shall be effective unless such increase has
been approved by the Company’s shareholders as and to the extent required by
the listing standards of the New York Stock Exchange.

 

(b)             Amendments to
Awards. 
Subject to the restrictions of Section 6(b), the Board may
waive any conditions or rights under, amend any terms of or alter, suspend,
discontinue, cancel or terminate, any Award theretofore granted, prospectively
or retroactively; provided that any such waiver, amendment, alteration,
suspension, discontinuance, cancellation or termination that would materially
and adversely affect the rights of any Participant or any holder or beneficiary
of any Award theretofore granted shall not to that extent be effective without
the consent of the affected Participant, holder or beneficiary.

 

(c)              Adjustments of
Awards Upon the Occurrence of Certain Unusual or Nonrecurring Events.  The Board is hereby
authorized to make equitable and proportionate adjustments in the terms and
conditions of, and the criteria included in, Awards in recognition of unusual
or nonrecurring events (and shall make such adjustments for events described in
Section 4(c)) affecting the Company, any Subsidiary or Affiliate,
or the financial statements of the Company or any Subsidiary or Affiliate, or
of changes in applicable laws, regulations or accounting principles.

 

17

 

(d)             Section 409A
Compliance.  No Award
(or modification thereof) shall provide for deferral of compensation that does
not comply with Section 409A of the Code unless the Board, at the time of
grant, specifically provides that the Award is not intended to comply with Section 409A
of the Code.  Notwithstanding any
provision of this Plan to the contrary, if one or more of the payments or
benefits received or to be received by a Participant pursuant to an Award would
cause the Participant to incur any additional tax or interest under Section 409A
of the Code, the Board may reform such provision to maintain to the maximum
extent practicable the original intent of the applicable provision without
violating the provisions of Section 409A of the Code.

 

Section 15.            General Provisions.

 

(a)              Limited
Transferability of Awards. Except as
otherwise provided in the Plan, no Award shall be assigned, alienated, pledged,
attached, sold or otherwise transferred or encumbered by a Participant, except
by will or the laws of descent and distribution.  No transfer of an Award by will or by laws of
descent and distribution shall be effective to bind the Company unless the
Company shall have been furnished with written notice thereof and an
authenticated copy of the will and/or such other evidence as the Board may deem
necessary or appropriate to establish the validity of the transfer.  If authorized in the applicable Award
Agreement, a Participant may transfer, “not for value”, all or part of an
Option that is not an Incentive Stock Option to any Family Member. For the
purpose of this Section 15(a), a “not for value” transfer is a
transfer that is (i) a gift; (ii) a transfer under a domestic
relations order in settlement of marital property rights; or (iii) a
transfer to an entity in which more than fifty percent (50%) of the voting
interests are owned by Family Members (or the Participant) in exchange for an
interest in that entity. Following a transfer under this Section 15(a),
any such Option shall continue to be subject to the same terms and conditions
as were applicable immediately prior to transfer. Subsequent transfers of
transferred Options are prohibited except to Family Members of the original
Participant in accordance with this Section 15(a) or by will
or the laws of descent and distribution. Notwithstanding any transfer permitted
by this Section 15(a), such Options shall remain subject to any
vesting, forfeiture or other requirements set forth in the Award Agreement.

 

(b)             Dividend
Equivalents. 
In the sole and complete discretion of the Board, a Full-Value Award
may provide the Participant with dividends or dividend equivalents, payable in
cash, Shares, other securities or other property on a current or deferred
basis.  All dividend or dividend
equivalents which are not paid currently may, at the Board’s discretion, accrue
interest, be reinvested into additional Shares, or, in the case of dividends or
dividend equivalents credited in connection with a Full-Value Award that is a
Performance Award, be credited as additional Performance Awards and paid to the
Participant if and when, and to the extent that, payment is made pursuant to
such Award.  The total number of Shares
available for grant under Section 4 shall not be reduced to reflect
any dividends or dividend equivalents that are reinvested into additional
Shares or credited as Performance Awards.

 

(c)              No Rights to
Awards. 
No Person shall have any claim to be granted any Award, and there is no
obligation for uniformity of treatment of Participants or holders or
beneficiaries of Awards.  The terms and
conditions of Awards need not be the same with respect to each Participant.

 

18

 

(d)             Share
Certificates. 
All certificates for Shares or other securities of the Company or any
Subsidiary or Affiliate delivered under the Plan pursuant to any Award or the
exercise thereof shall be subject to such stop transfer orders and other
restrictions as the Board may deem advisable under the Plan or the rules,
regulations and other requirements of the SEC or any state securities
commission or regulatory authority, any stock exchange or other market upon
which such Shares or other securities are then listed, and any applicable
Federal or state laws, and the Board may cause a legend or legends to be put on
any such certificates to make appropriate reference to such restrictions.

 

(e)              Withholding.  A Participant may be
required to pay to the Company or any Subsidiary or Affiliate and the Company or
any Subsidiary or Affiliate shall have the right and is hereby authorized to
withhold from any Award, from any payment due or transfer made under any Award
or under the Plan, or from any compensation or other amount owing to a
Participant the amount (in cash, Shares, other securities, other Awards or
other property) of any applicable withholding or other tax-related obligations
in respect of an Award, its exercise or any other transaction involving an
Award, or any payment or transfer under an Award or under the Plan and to take
such other action as may be necessary in the opinion of the Company to satisfy
all obligations for the payment of such taxes. 
The Board may provide for additional cash payments to holders of Options
to defray or offset any tax arising from the grant, vesting, exercise or
payment of any Award.

 

(f)              Award
Agreements. 
Each Award shall be evidenced by an Award Agreement that shall be
delivered to the Participant and may specify the terms and conditions of the
Award and any rules applicable thereto. 
In the event of a conflict between the terms of the Plan and any Award
Agreement, the terms of the Plan shall prevail. 
The Board shall, subject to applicable law, determine the date an Award
is deemed to be granted.  The Board or,
except to the extent prohibited under applicable law, its delegate(s) may
establish the terms of agreements or other documents evidencing Awards under
this Plan and may, but need not, require as a condition to any such agreement’s
or document’s effectiveness that such agreement or document be executed by the
Participant, including by electronic signature or other electronic indication
of acceptance, and that such Participant agree to such further terms and
conditions as specified in such agreement or document.  The grant of an Award under this Plan shall
not confer any rights upon the Participant holding such Award other than such
terms, and subject to such conditions, as are specified in this Plan as being
applicable to such type of Award (or to all Awards) or as are expressly set
forth in the agreement or other document evidencing such Award.

 

(g)             No Limit on
Other Compensation Arrangements.  Nothing contained in the
Plan shall prevent the Company or any Subsidiary or Affiliate from adopting or
continuing in effect other compensation arrangements, which may, but need not,
provide for the grant of Options, Restricted Shares, Restricted Share Units,
Other Share-Based Awards or other types of Awards.

 

(h)             No Right to
Employment. 
The grant of an Award shall not be construed as giving a Participant
the right to be retained in the employ of the Company or any Subsidiary or
Affiliate.  Further, the Company or a
Subsidiary or Affiliate may at any time dismiss a Participant from employment,
free from any liability or any claim under the Plan, unless otherwise expressly
provided in an Award Agreement.

 

19

 

(i)               No Rights as
Shareholder. 
Subject to the provisions of the Plan and the applicable Award
Agreement, no Participant or holder or beneficiary of any Award shall have any
rights as a shareholder with respect to any Shares to be distributed under the
Plan until such person has become a holder of such Shares.  Notwithstanding the foregoing, in connection
with each grant of Restricted Shares, the applicable Award Agreement shall
specify if and to what extent the Participant shall not be entitled to the
rights of a shareholder in respect of such Restricted Shares.

 

(j)               Governing Law.  The validity, construction
and effect of the Plan and any rules and regulations relating to the Plan
and any Award Agreement shall be determined in accordance with the laws of the
State of Maryland without giving effect to conflicts of laws principles.

 

(k)              Severability.  If any provision of the Plan
or any Award is, or becomes, or is deemed to be invalid, illegal or
unenforceable in any jurisdiction or as to any Person or Award, or would
disqualify the Plan or any Award under any law deemed applicable by the Board,
such provision shall be construed or deemed amended to conform to the
applicable laws, or if it cannot be construed or deemed amended without, in the
determination of the Board, materially altering the intent of the Plan or the
Award, such provision shall be stricken as to such jurisdiction, Person or
Award and the remainder of the Plan and any such Award shall remain in full
force and effect.

 

(l)               Other Laws.  The Board may refuse to
issue or transfer any Shares or other consideration under an Award if, acting
in its sole discretion, it determines that the issuance or transfer of such
Shares or such other consideration might violate any applicable law or
regulation (including applicable non-U.S. laws or regulations) or entitle the
Company to recover the same under Exchange Act Section 16(b), and any
payment tendered to the Company by a Participant, other holder or beneficiary
in connection with the exercise of such Award shall be promptly refunded to the
relevant Participant, holder or beneficiary.

 

(m)             No Trust or
Fund Created. 
Neither the Plan nor any Award shall create or be construed to create a
trust or separate fund of any kind or a fiduciary relationship between the
Company or any Subsidiary or Affiliate and a Participant or any other
Person.  To the extent that any Person
acquires a right to receive payments from the Company or any Subsidiary or
Affiliate pursuant to an Award, such right shall be no greater than the right
of any unsecured general creditor of the Company or any Subsidiary or
Affiliate.

 

(n)             No Fractional
Shares. 
No fractional Shares shall be issued or delivered pursuant to the Plan
or any Award, and the Board shall determine whether cash, other securities or
other property shall be paid or transferred in lieu of any fractional Shares or
whether such fractional Shares or any rights thereto shall be canceled,
terminated or otherwise eliminated.

 

(o)             Headings.  Headings are given to the
sections and subsections of the Plan solely as a convenience to facilitate
reference.  Such headings shall not be
deemed in any way material or relevant to the construction or interpretation of
the Plan or any provision thereof.

 

20

 

Section 16.            Term Of The Plan.

 

(a)              Effective Date.  The Plan initially became
effective as of May 8, 2007 following approval by the Board and by the
Company’s shareholders.  The Plan has
been amended and restated effective as of June 2, 2010 (the “Restatement
Effective Date”) following approval by the Board and by the Company’s
shareholders.

 

(b)             Expiration Date.  No new Awards shall be
granted under the Plan after the tenth anniversary of the Restatement Effective
Date.  Unless otherwise expressly
provided in the Plan or in an applicable Award Agreement, any Award may, and
the authority of the Board or the Board to amend, alter, adjust, suspend,
discontinue or terminate any such Award or to waive any conditions or rights
under any such Award shall, continue after the tenth anniversary of the
Restatement Effective Date.

 

21Exhibit
10.1

 

Constellation
Energy Group, Inc.

2007 Long-Term
Incentive Plan

(Plan)

Amended and
Restated Effective May 28, 2010

 

1.             Purpose.  The purpose
of this Plan is to increase shareholder value by providing a long-term
incentive to reward officers and key employees of the Company and its
Subsidiaries, who are mainly responsible for the continued growth, development,
and financial success of the Company and its Subsidiaries, and for the
continued profitable performance of the Company and its Subsidiaries.  The Plan is also designed to permit the
Company and its Subsidiaries to attract and retain talented and motivated
directors, officers, consultants and employees and to increase their ownership
of Company common stock.  The Plan also
provides the ability to award long-term incentives that qualify for federal
income tax deduction.  Upon the adoption
of this Plan, no new Awards shall be granted under any prior long-term
incentive plan.

 

2.             Definitions.  All singular
terms defined in this Plan will include the plural and  vice versa.  As used
herein, the following terms will have the meaning specified below:

 

“Award” means
individually or collectively, Cash-Based Award, Restricted Stock, Restricted
Stock Units, Options, Performance Units, Stock Appreciation Rights, Dividend
Equivalents, or Other Equity granted under this Plan.

 

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

 

“Cash-Based Award” means
an Award granted to a Participant as described in Section 12A.

 

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

 

(i)            individuals
who, on the effective date of the adoption of the Plan, constitute the Board
(the “Incumbent Directors”)
cease for any reason to constitute at least a majority of the Board, provided
that any person becoming a director subsequent to such adoption date, whose
election or nomination for election was approved by a vote of at least
two-thirds of the Incumbent Directors then on the Board (either by a specific
vote or by approval of the proxy statement of the Company in which such person
is named as a nominee for director, without written objection to such
nomination) shall be an Incumbent Director; provided, however,
that no individual initially elected or nominated as a director of the Company
as a result of an actual or threatened election contest with respect to
directors or as a result of any other actual or threatened solicitation of
proxies by or on behalf of any person other than the Board shall be deemed to
be an Incumbent Director;

 

(ii)           any
“person” (as such term is defined in Section 3(a)(9) of the 1934 Act
and as used in Sections 13(d)(3) and 14(d)(2) of the 1934 Act) is or
becomes a “beneficial owner” (as defined in Rule 13d-3 under the 1934
Act), directly or indirectly, of securities of the Company representing 20% or
more of the combined voting power of the Company’s then outstanding securities
eligible to vote for the election of the Board (the “Company Voting Securities”); provided, however, that
the event described in this paragraph (ii) shall not be deemed to be a
Change in Control by virtue of any of the following acquisitions:  (A) by the Company or any corporation
with respect to which the Company owns a majority of the outstanding shares of
common stock or has the power to vote or direct the voting of sufficient
securities to elect a majority of the directors (a “Subsidiary Company”), (B) by any employee benefit plan (or
related trust) sponsored or maintained by the Company or any Subsidiary
Company, (C) by any underwriter temporarily holding securities pursuant to
an offering of such securities, (D) pursuant to a Non-Qualifying
Transaction (as defined in paragraph (iii)), or (E) pursuant to any
acquisition by a Participant or any group of persons including a Participant
(or any entity controlled by a Participant or any group of persons including a
Participant);

 

 

(iii)          consummation
of a merger, consolidation, statutory share exchange or similar form of
corporate transaction involving the Company (a “Business Combination”), unless immediately following such
Business Combination:  (A) more than
60% of the total voting power of (x) the corporation resulting from such
Business Combination (the “Surviving
Corporation”), or (y) if applicable, the ultimate parent
corporation that directly or indirectly has beneficial ownership of at least
95% of the voting securities eligible to elect directors of the Surviving
Corporation (the “Parent Corporation”),
is represented by Company Voting Securities that were outstanding immediately
prior to such Business Combination (or, if applicable, is represented by shares
into which such Company Voting Securities were converted pursuant to such
Business Combination), and such voting power among the holders thereof is in
substantially the same proportion as the voting power of such Company Voting
Securities among the holders thereof immediately prior to the Business
Combination, (B) no person (other than any employee benefit plan (or
related trust) sponsored or maintained by the Surviving Corporation or the
Parent Corporation), is or becomes the beneficial owner, directly or
indirectly, of 20% or more of the total voting power of the outstanding voting
securities eligible to elect directors of the Parent Corporation (or, if there
is no Parent Corporation, the Surviving Corporation) and (C) at least a
majority of the members of the board of directors of the Parent Corporation
(or, if there is no Parent Corporation, the Surviving Corporation) following
the consummation of the Business Combination were Incumbent Directors at the
time of the Board’s approval of the execution of the initial agreement
providing for such Business Combination (any Business Combination which
satisfies all of the criteria specified in (A), (B), and (C) above shall
be deemed to be a “Non-Qualifying Transaction”);
or

 

(iv)          the
stockholders of the Company approve a plan of complete liquidation or
dissolution of the Company, or the consummation of a sale of all or
substantially all of the Company’s assets.

 

Notwithstanding the
foregoing, a Change in Control of the Company shall not be deemed to occur
solely because any person acquires beneficial ownership of more than 20% of the
Company Voting Securities as a result of the acquisition of Company Voting
Securities by the Company which reduces the number of Company Voting Securities
outstanding; provided, that if after such acquisition by the
Company such person becomes the beneficial owner of additional Company Voting
Securities that increases the percentage of outstanding Company Voting
Securities beneficially owned by such person, a Change in Control of the
Company shall then occur.

 

“Code”
means the Internal Revenue Code of 1986, as amended.  Reference in the Plan to any section of the
Code will be deemed to include any amendments or successor provisions to such
section and any regulations promulgated thereunder.

 

“Committee”
means the Compensation Committee of the Board or such other committee as the
Board shall appoint from time to time to administer the Plan and to otherwise
exercise and perform the authority and functions assigned to the Committee
under the terms of the Plan, at least two members of which qualify as
non-employee directors (within the meaning of Rule 16b-3 promulgated under
Section 16 of the 1934 Act), and as “outside directors” within the meaning
of Treasury Regulation Section 1.162-27(e)(3) and as “independent”
within the meaning of any rules or regulations promulgated by an
applicable stock exchange or similar regulatory authority.

 

“Company” means
Constellation Energy Group, Inc., a Maryland corporation, or its
successor, including any “New Company” as provided in Section 16J.

 

“Covered Employee” means
a Participant, who at the time of reference, is a “covered employee”, as
described in Code Section 162(m).

 

“Date
of Grant” means the date on which the granting of an Award is authorized by the
Plan Administrator or such later date as may be specified by the Plan
Administrator in such authorization.

 

 

“Disability”
means the determination that a Participant is “disabled” under the Company
disability plan in effect at that time or, if applicable to such Participant, a
Subsidiary disability plan in effect at that time.

 

“Dividend
Equivalent” means an Award granted under Section 11.

 

“Eligible
Person” means any person who satisfies all of the requirements of Section 5.

 

“Exercise
Period” means the period or periods during which a Stock Appreciation Right is
exercisable.

 

“Fair
Market Value” means the value of the Stock determined by such methods or
procedures as shall be established from time to time by the Plan Administrator;
provided, that to the extent required to avoid the imposition of a tax under Section 409A
of the Code in respect of an Award, such method shall conform to the
requirements of Section 409A.

 

“Incentive Stock Option”
means an incentive stock option within the meaning of Section 422 of the
Code.

 

“1934
Act” means the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder.

 

“Option”
or “Stock Option” means either a nonqualified stock option or an Incentive
Stock Option.

 

“Option
Period” or “Option Periods” means the period or periods during which an Option
is exercisable.

 

“Other
Equity” means an Award granted under Section 12B.

 

“Participant”
means an individual who has been granted an Award under this Plan.

 

“Pension
Plan” means the Pension Plan of Constellation Energy Group, Inc. as may be
amended from time to time, or other qualified retirement plan of Constellation
Energy Group, Inc. or a Subsidiary designated by the Committee from time
to time.

 

“Performance-Based
Compensation” means compensation under an award that satisfies the requirements
of Section 162(m) of the code for deductibility of remuneration paid
to Covered Employees.

 

“Performance
Measures” means measures as described in Section 13 on which the
performance goals are based and which are approved by the Company’s
shareholders pursuant to the Plan in order to qualify Awards as
Performance-Based Compensation.

 

“Performance
Period” means the taxable year of the Company or any other period designated by
the Plan Administrator with respect to which an Award may be granted.

 

“Performance Target(s)”
means the specific objective goal or goals that are timely set in writing by
the Committee pursuant to Section 13B for each Participant for the
applicable Performance Period in respect of any one or more of the Performance
Measures.

 

“Performance
Unit” means a unit of measurement equivalent to such amount or measure as
defined by the Plan Administrator which may include, but is not limited to,
dollars or market value shares.

 

“Plan
Administrator” means, as set forth in Section 4, the Committee or its
designee.

 

“Restricted
Stock” means Stock issued in the name of a Participant that bears a restrictive
legend prohibiting sale, transfer, pledge or hypothecation of the Stock until
the expiration of the restriction period as described in Section 7.

 

 

“Restricted
Stock Unit” means a right granted that is denominated in shares of stock, each
of which represents a right to receive the value of a share of stock (or a
percentage of such value, which percentage may be higher than 100%) upon the
terms and conditions set forth by the Plan Administrator.

 

“Retirement”
means retirement on or after the earlier of: (i) eligibility to receive an
early retirement benefit under a Pension Plan, (ii) eligibility to receive
retirement benefits under a Company supplemental retirement plan; or (iii) such
time as is specified in an applicable employment arrangement.

 

“Stock”
means the common stock, without par value, of the Company.

 

“Stock
Appreciation Right” means an Award granted under Section 10.

 

“Subsidiary”
means any entity that is directly or indirectly controlled by the Company or
any entity, including an acquired entity, in which the Company has a significant
equity interest, as determined by the Plan Administrator, in its discretion.

 

“Termination”
means resignation or discharge from employment (or cessation of board
membership in the case of a director or cessation of the performance of
services in the case of a consultant) with the Company or any of its
Subsidiaries except in the event of death, Disability, or Retirement.

 

“Year”
means a fiscal year of the Company commencing on or after May 18, 2007
that constitutes all or part of the applicable Performance Period.

 

3.             Effective Date, Duration and Stockholder Approval.

 

A.            Effective Date and Stockholder Approval.  Subject to the approval of the Plan by the
Company’s shareholders in accordance with Maryland law at the Company’s 2007
Annual Meeting of Stockholders, the Plan will be effective as of May 18,
2007.  The Plan was amended and restated
effective February 21, 2008, February 26, 2009, and May 28,
2010.

 

B.            Period for Grants of Awards.  Awards may be made as provided herein for a
period of 10 years after May 18, 2007.

 

C.            Termination.  The Plan will continue in effect until all
matters relating to the payment of outstanding Awards and administration of the
Plan have been settled.

 

4.             Plan Administration.  The Committee is the Plan Administrator and
has sole authority (except as specified otherwise herein) to determine all
questions of interpretation and application of the Plan, or of the terms and
conditions pursuant to which Awards are granted, exercised or forfeited under
the Plan provisions, and, in general, to make all determinations advisable for
the administration of the Plan to achieve its stated purpose.  Without limiting the generality of the
foregoing, on or after the date of grant of an Award the Plan Administrator may
modify, amend, extend, renew or accelerate the vesting or settlement of
outstanding Awards, or accept the surrender of outstanding Awards and
substitute new Awards or otherwise amend an outstanding Award in whole or in
part from time-to-time in such manner as the Committee determines, in its sole
and absolute discretion, to be necessary or appropriate, which amendments may
be made retroactively or prospectively, provided, however, that, (i) no
modification, amendment or substitution that results in repricing a Stock
Option or Stock Appreciation Right that is settled in shares to a lower
exercise price, other than to reflect an adjustment made pursuant to Section 14,
shall be made without prior stockholder approval; (ii) except as provided
in Section 14 of the Plan, any modification that would materially
adversely affect any outstanding Award shall not be made without the consent of
the Participant and, (iii) the Committee shall not have any such authority
to the extent that the grant or exercise of such authority would cause any tax
to become due under Section 409A of the Code).  In addition, the Committee will have the
authority to determine whether an authorized leave of absence, absence in the
military or government 

 

 

service,
or other break in the continuous service of an employee or consultant
constitutes a termination of employment (or provision of services, in the case
of a consultant).  The employment of an
employee (or provision of services in respect of a consultant) with the Company
shall be deemed to have terminated for all purposes of the Plan if such person
is employed by or provides services to an entity that is a Subsidiary of the
Company and such entity ceases to be a Subsidiary of the Company, unless the
Committee determines otherwise.

 

The
Plan Administrator’s determinations under the Plan (including without
limitation, determinations of the persons to receive Awards, the form, amount
and timing of such Awards, the terms and provisions of such Awards and any
agreements evidencing such Awards) need not be uniform and may be made by the
Plan Administrator selectively among persons who receive, or are eligible to
receive, Awards under the Plan, whether or not such persons are similarly
situated.  Such determinations shall be
final and not subject to further appeal.

 

The
Committee may delegate its authority under the Plan to one or more
subcommittees, which may be comprised of one or more directors, officers or
employees of the Company to the extent permitted by applicable law, with
respect to Participants who are not directors or executive officers of the
Company.

 

5.             Eligibility.  Each officer, employee, consultant or
director of the Company and its Subsidiaries may be designated by the Plan
Administrator as a Participant, from time to time, with respect to one or more
Awards.  No officer, employee, consultant
or director of the Company or its Subsidiaries shall have any right to be
granted an Award under this Plan.  The
Plan Administrator may also grant Awards to individuals in connection with
hiring (as an officer, employee, consultant or director), retention or
otherwise[, prior to the date the individual first performs services for the
Company or a Subsidiary; provided, however, that such Awards shall not become
vested or exercisable prior to the date the individual first commences
performance of such services

 

6.             Grant of Awards and
Limitation of Number of Shares Awarded. 
The Plan
Administrator may, from time to time, grant Awards to one or more Eligible
Persons, provided that subject to any adjustment pursuant to Section 14,
the aggregate number of shares of Stock subject to Awards that may be delivered
under this Plan may not exceed 18,000,000 shares.  Shares delivered by the Company
under the Plan may be authorized and unissued Stock or Stock purchased on the open
market (including private purchases) in accordance with applicable securities
laws.

 

Any shares of Stock
covered by an Award (or portion of an Award) granted under the Plan that are
forfeited or canceled, expire or are not issued due to the cash-settlement of
such Award, shall be deemed not to have been delivered for purposes of
determining the maximum number of shares available for delivery under the Plan.  Any shares of Stock
covered by an Award (or portion of an Award) granted under a prior long-term
incentive plan that are forfeited or canceled, expire or are not issued due to
the cash-settlement of such prior long-term incentive plan Award shall be
available for delivery under this Plan.

 

The maximum number of
shares of Stock that may be issued in conjunction with  Restricted Stock or Restricted Stock Unit
Awards under Section 7 of the Plan, 
Performance Unit Awards under Section 9 of the Plan and other
Equity Awards under Section 12 of the Plan shall in the aggregate be
4,500,000.  The maximum number of shares
of Stock subject to Awards of any combination that may be granted during any
calendar year under the Plan to any one person is 2,000,000  and
the maximum amount of cash that may be granted pursuant to an Award during any
calendar year under the Plan to any one person is $20,000,000; provided,
however, that to the extent the maximum permissible award is not made in a
year, such amount may be carried over to subsequent years.  Such per-individual limit shall not be
adjusted to effect a restoration of shares of Stock with respect to which the
related Award is terminated, surrendered or canceled.   Shares of Stock covered by Awards granted
pursuant to the Plan in connection with the assumption, replacement, conversion
or adjustment of outstanding equity-based awards in the context of a corporate
acquisition or merger (within the meaning of Section 303A.08 of the New
York Stock Exchange 

 

 

Listed Company Manual or
any successor provision) shall not count as used under the Plan for purposes of
this Section 6..

 

The Plan Administrator
may permit or require a recipient of an Award to defer all or part of such
individual’s receipt of the payment of cash or the delivery of Stock that would
otherwise be due to such individual by virtue of the exercise of, payment of,
or lapse or waiver of restrictions respecting, any Award.  If any such payment deferral is required or
permitted, the Plan Administrator shall, in its sole discretion, establish rules and
procedures for such payment deferrals.

 

7.             Restricted Stock and
Restricted Stock Unit Awards.

 

A.            Grants of Restricted Shares or Units.
One or more shares of Restricted Stock or Restricted Stock Units may be granted
to any Eligible Person.  The Restricted
Stock may be issued or Restricted Stock Unit granted to the Participant on the
Date of Grant without the payment of consideration by the Participant.  The Restricted Stock will be issued or
Restricted Stock Unit granted in the name of the Participant and will bear a
restrictive legend prohibiting sale, transfer, pledge or hypothecation of the
Restricted Stock or Restricted Stock Unit until the expiration of the
restriction period.  Each Restricted
Stock or Restricted Stock Unit Award may have a different restriction period,
at the discretion of the Plan Administrator.

 

The
Plan Administrator may also impose such other restrictions and conditions on
the Restricted Stock or Restricted Stock Unit as it deems appropriate
including, without limitation, a requirement that a Participant pay a
stipulated purchase price for each share of Restricted Stock or Restricted
Stock Unit, restrictions based upon the achievement of specific performance
goals, service-based restrictions on vesting following attainment of
performance goals or service-based restrictions.

 

Upon
issuance to the Participant of the Restricted Stock the Participant will have
the right to vote the Restricted Stock. 
Upon issuance to the Participant of the Restricted Stock or grant of the
Restricted Stock Unit and subject to the Plan Administrator’s discretion, the
Participant will have the right to receive the cash dividends (or Dividend
Equivalents as provided in Section 11) distributable with respect to such
shares or units, with such dividends or Dividend Equivalents treated as
compensation to the Participant. The Plan Administrator, in its sole
discretion, may direct the accumulation and payment of distributable dividends
to the Participant at such times, and in such form and manner, as determined by
the Plan Administrator.

 

B.            Forfeiture or Payout of Award.  For Awards that are subject to restrictions
based upon achievement of specific performance goals, as soon as practicable
after the end of each Performance Period, the Plan Administrator will determine
whether the performance objectives and other material terms of the Award were
satisfied.  The Plan Administrator’s
determination of all such matters will be final and conclusive.

 

As
soon as practicable after the date the Plan Administrator makes the above
determination, the Plan Administrator will determine the Award payment for each
Participant. In the event a Participant ceases employment (or ceases board
membership in the case of a director or ceases the performance of services in
the case of a consultant) during a restriction period, a Restricted Stock or
Restricted Stock Unit Award is subject to forfeiture or payout (i.e., removal
of restrictions) as follows: (a) involuntary Termination by the Company
without cause (as determined in the sole discretion of the Company) -
payout of the Restricted Stock or Restricted Stock Unit Award is prorated for
service during the period; (b) Retirement, Disability or death -
payout of the Restricted Stock or Restricted Stock Unit Award is prorated for
service during the period; or (c) other Termination - the
Restricted Stock or Restricted Stock Unit Award is completely forfeited.  Notwithstanding the foregoing, the Plan
Administrator may modify the above in its sole discretion in the actual Award.

 

Any
shares of Restricted Stock which are forfeited will be transferred to the
Company.

 

 

C.            Form and Timing of Payment.  With respect to shares of Restricted Stock,
upon completion of the restriction period and satisfaction of any other
conditions related to the Award, all Award restrictions will expire and new
certificates representing the Award will be issued (the payout) without the
restrictive legend described in Section 7A.  With respect to Restricted Stock Units, upon
completion of the restriction period and satisfaction of any other conditions
related to the Award, such Units may be paid out in cash or shares of Stock or
in a combination of cash and Stock, as determined by the Plan Administrator in
its sole discretion.  Such payouts will
be made as soon as practicable after the Award payment is determined.

 

D.            Waiver of Section 83(b) Election.  Unless otherwise directed by the Plan
Administrator, as a condition of receiving an Award of Restricted Stock, a
Participant must waive in writing the right to make an election under Section 83(b) of
the Code to report the value of the Restricted Stock as income on the Date of
Grant.

 

8.             Stock Options.

 

A.            Grants of Options.  One or more Options may be granted to any
Eligible Person on the Date of Grant with or without the payment of
consideration by the Participant.

 

B.             Stock Option Agreement.  Each Option granted under the Plan will be
evidenced by a “Stock Option Agreement” between the Company and the Participant
containing provisions determined by the Plan Administrator, including, without
limitation, provisions to qualify Incentive Stock Options as such under Section 422
of the Code if directed by the Plan Administrator at the Date of Grant;
provided, however, that each Incentive Stock Option Agreement must include the
following terms and conditions:  (i) that
the Options are exercisable, either in total or in part, with a partial
exercise not affecting the exercisability of the balance of the Option;  (ii) every share of Stock purchased
through the exercise of an Option will be paid for in full at the time of the
exercise; (iii) each Option will cease to be exercisable, as to any share
of Stock, at the earliest of (a) the Participant’s purchase of the Stock
to which the Option relates, (b) the Participant’s exercise of a related
Stock Appreciation Right, or (c) the lapse of the Option; (iv) Options
will not be transferable by the Participant except by will or the laws of
descent and distribution and will be exercisable during the Participant’s
lifetime only by the Participant or by the Participant’s guardian or legal
representative; and (v) notwithstanding any other provision, in the event
of a public tender for all or any portion of the Stock or in the event that any
proposal to merge or consolidate the Company with another company is submitted
to the stockholders of the Company for a vote, the Plan Administrator, in its
sole discretion, may declare any previously granted Options to be immediately
exercisable.

 

C.             Option Price.  The Option price per share of Stock will be
set by the grant, but will be not less than 100% of the Fair Market Value at
the Date of Grant.

 

D.            Form of Payment.  At the time of the exercise of the Option,
the Option price will be payable in cash or in shares of Stock or in a
combination of cash and shares of Stock, in a form and manner as required by
the Plan Administrator in its sole discretion. 
When Stock is used in full or partial payment of the Option price, it
will be valued at the Fair Market Value on the applicable date.

 

E.             Other Terms and Conditions.  The Option will become exercisable in such
manner and within such Option Period or Periods, not to exceed 10 years from
its Date of Grant, as set forth in the Stock Option Agreement upon payment in
full.  Except as otherwise provided in
this Plan or in the Stock Option Agreement, any vested Option may be exercised
in whole or in part at any time.  In the
event of a Change in Control, any vested option will remain exercisable for the
duration of the Option Period.

 

F.             Lapse of Option.  An Option will lapse upon the earlier
of:  (i) 10 years from the Date of
Grant, or (ii) at the expiration of the Option Period set by the
grant.  If the Participant ceases
employment (or ceases board membership in the case of a director or ceases the
performance of services in the case of a consultant) within the Option Period
and prior to the lapse of the Option, the Option will lapse as follows: (a) Retirement
(for Awards granted on or after February 21, 2008) — any unvested
Option shall continue to vest 

 

 

in
accordance with the schedule set forth in the Stock Option Agreement and all
Options will lapse on the earlier of the expiration date of the Option Period
specified in the Stock Option Agreement or 5 years from the effective date of
Retirement; (b) Retirement (for Awards granted before February 21,
2008), Disability or death — any unvested Option will lapse on the
effective date of the Retirement, Disability or death and any vested Option
will lapse at the expiration of the Option Period set by the Grant; or (c) other
Termination — any unvested Option will lapse on the effective date of the
Termination and any vested Option will lapse 90 days after the effective date
of the Termination.  Notwithstanding the
foregoing, the Plan Administrator may modify the above in its sole discretion
in the actual Award.

 

G.            Individual Limitation.  In the case of an Incentive Stock Option, the
aggregate Fair Market Value of the Stock for which Incentive Stock Options
(whether under this Plan or another arrangement) in any calendar year are first
exercisable will not exceed $100,000 with respect to such calendar year (or
such other individual limit as may be in effect under the Code on the Date of
Grant) plus any unused portion of such limit as the Code may permit to be
carried over.

 

9.             Performance Units.

 

A.            Grants of Performance Units.  One or more Performance Units may be
granted to any Eligible Person.  The
Performance Units may be issued to the Participant on the Date of Grant without
the payment of consideration by the Participant.  One or more Performance Units may be earned
by an Eligible Person based on the achievement of performance objectives during
a Performance Period, in the sole discretion of the Plan Administrator.  The Plan Administrator may also impose such
other restrictions and conditions on the Performance Units as it deems
appropriate.  Each Performance Unit Award
may be subject to different restrictions and conditions, at the discretion of
the Plan Administrator.

 

B.            Forfeiture or Payout of Award.
As soon as practicable after the end of each Performance Period, the Plan
Administrator will determine whether the performance objectives and other
material terms of the Award were satisfied. 
The Plan Administrator’s determination of all such matters will be final
and conclusive.

 

As
soon as practicable after the date the Plan Administrator makes the above
determination, the Plan Administrator will determine the Award payment for each
Participant.

 

In the event a
Participant ceases employment (or ceases board membership in the case of a
director or ceases the performance of services in the case of a consultant)
during a Performance Period (or at the Plan Administrator’s discretion, prior
to Award payout), the Performance Unit Award generally is subject to forfeiture
or payout as follows: (a) involuntary Termination by the Company
without cause, as determined in the sole discretion of the Company (for
terminations that occurred before February 26, 2009), Retirement (for
Awards granted before February 21, 2008), Disability or death — (i) if
the Plan Administrator determines that performance is at or above an applicable
target at the time employment ceases, payout of the Performance Unit Award is
based on 100% of target performance and prorated for service during the
Performance Period and  (ii) if the
Plan Administrator determines that performance is below target at the time
employment ceases no payout will be made; (b) Retirement (for Awards
granted on or after February 21, 2008) — payout is prorated for
service during the Performance Period and based on the achievement of performance
objectives as determined by the Plan Administrator after the end of the
Performance Period; (c) involuntary Termination by the Company without
cause, as determined in the sole discretion of the Company (for terminations on
or after February 26, 2009) — (i) if the Plan Administrator
determines that performance is at or above an applicable target after the end
of the Performance Period, payout of the Performance Unit Award is based on
100% of target performance and prorated for service during the Performance
Period and (ii) if the Plan Administrator determines that performance is
below target after the end of the Performance Period no payout will be made; or
(d) other Termination - the Performance Unit Award is completely
forfeited.  Notwithstanding the foregoing,
the Plan Administrator may modify the above in its sole discretion in the
actual Award.

 

 

C.            Form and Timing of Payment. Each Performance Unit payout may be paid in cash or
shares of Stock or in a combination of cash and Stock, as determined by the
Plan Administrator in its sole discretion. 
Such payouts will be made within a reasonable period of time, as
determined in the sole discretion of the Plan Administrator, after the Award
payment is determined.

 

10.           Stock Appreciation Rights.

 

A.            Grants of Stock Appreciation Rights.  Stock Appreciation Rights may be granted
under the Plan in conjunction with an Option either at the Date of Grant or by
amendment or may be separately granted. 
Each Stock Appreciation Right will have a grant price of not less than
100% of the Fair Market Value at the Date of Grant.  Stock Appreciation Rights will be subject to
such terms and conditions not inconsistent with the Plan as the Plan
Administrator may impose.

 

B.            Right to Exercise; Exercise Period.
A Stock Appreciation Right issued pursuant to an Option will be exercisable to
the extent the Option is exercisable.  A
Stock Appreciation Right issued independent of an Option will be exercisable
pursuant to such terms and conditions established in the Award.  Notwithstanding such terms and conditions, in
the event of a public tender for all or any portion of the Stock or in the
event that any proposal to merge or consolidate the Company with another
company is submitted to the stockholders of the Company for a vote, the Plan
Administrator, in its sole discretion, may declare any previously granted Stock
Appreciation Right immediately exercisable.

 

C.            Failure to Exercise.  If on the last day of the Option Period, in
the case of a Stock Appreciation Right granted pursuant to an Option, or the
specified Exercise Period, in the case of a Stock Appreciation Right issued
independent of an Option, the Participant has not exercised a Stock
Appreciation Right, then such Stock Appreciation Right will be deemed to have
been exercised by the Participant on the last day of the Option Period or
Exercise Period.

 

D.            Payment.  An exercisable Stock Appreciation Right
granted pursuant to an Option will entitle the Participant to surrender
unexercised the Option or any portion thereof to which the Stock Appreciation
Right is attached, and to receive in exchange for the Stock Appreciation Right
payment (in cash or Stock or a combination thereof as described below) equal to
the excess of the Fair Market Value of one share of Stock at the date of
exercise over the Option price, times the number of shares called for by the
Stock Appreciation Right (or portion thereof) which is so surrendered.  Upon exercise of a Stock Appreciation Right
not granted pursuant to an Option, the Participant will receive for each Stock
Appreciation Right payment (in cash or Stock or a combination thereof as
described below) equal to the excess of the Fair Market Value of one share of
Stock at the date of exercise over the Fair Market Value of one share of Stock
at the Date of Grant of the Stock Appreciation Right, times the number of
shares called for by the Stock Appreciation Right.

 

The
Plan Administrator may direct the payment in settlement of the Stock
Appreciation Right to be in cash or Stock or a combination thereof.  Alternatively, the Plan Administrator may
permit the Participant to elect to receive cash in full or partial settlement
of the Stock Appreciation Right, provided that the Plan Administrator must
consent to or disapprove such election. 
The value of the Stock to be received upon exercise of a Stock
Appreciation Right shall be the Fair Market Value of the Stock on the trading
day preceding the date on which the Stock Appreciation Right is exercised.  To the extent that a Stock Appreciation Right
issued pursuant to an Option is exercised, such Option shall be deemed to have
been exercised, and shall not be deemed to have lapsed.

 

E.             Nontransferable.  A Stock Appreciation Right will not be
transferable by the Participant except by will or the laws of descent and
distribution and will be exercisable during the Participant’s lifetime only by
the Participant or by the Participant’s guardian or legal representative.

 

F.             Lapse of a Stock Appreciation Right.  A Stock Appreciation Right will lapse upon
the earlier of:  (i) 10 years from
the Date of Grant; or (ii) at the expiration of the Exercise Period as set
by the grant.  If the

 

 

Participant
ceases employment (or ceases Board membership in the case of a director or
ceases the performance of services in the case of a consultant) within the
Exercise Period and prior to the lapse of the Stock Appreciation Right, the
Stock Appreciation Right will lapse as follows: (a) Retirement,
Disability or death — any unvested Stock Appreciation Right will lapse on
the effective date of the Retirement, Disability or death and any vested Stock
Appreciation Right will lapse at the expiration of the Exercise Period set by
the grant; or (b) other Termination — any unvested Stock
Appreciation Right will lapse on the effective date of the Termination and any
vested Stock Appreciation Right will lapse 90 days after the effective date of
the Termination; provided, however, that the Plan Administrator may modify the
above in its sole discretion.

 

11.                                 Dividend Equivalents.

 

A.            Grants of Dividend Equivalents.  Dividend Equivalents may also be granted
under the Plan in conjunction with Restricted Stock, Restricted Stock Units or
Performance Units, at any time during the Performance Period, without
consideration by the Participant.  Dividend Equivalents will be
structured in a manner that complies with Section 409A of the Code.

 

B.            Payment.  Each Dividend Equivalent will entitle the
Participant to receive an amount equal to the dividend actually paid with
respect to a share of Stock on each dividend payment date from the Date of
Grant to the date the Dividend Equivalent lapses as set forth in Section 11D.  The Plan Administrator, in its sole
discretion, may direct the payment of such amount at such times and in such
form and manner as determined by the Plan Administrator.

 

C.            Nontransferable.  A Dividend Equivalent will not be
transferable by the Participant.

 

D.            Lapse of a Dividend Equivalent.  Each Dividend Equivalent will lapse on the
earlier of (i) the end of the Performance Period (or if earlier, the date
the Participant ceases employment or ceases board membership in the case of a
director or ceases the performance of services in the case of a consultant) of
the related Performance Units, Restricted Stock or Restricted Stock Unit Award;
or (ii) the lapse date established by the Plan Administrator on the Date
of Grant of the Dividend Equivalent.

 

12.                                 Cash-Based Awards and Other Equity Awards.

 

A.            Grant of Cash-Based Awards.  Cash-Based Awards may be granted to any
Eligible Person, in such amounts, on such terms and conditions, and for such
consideration, including no consideration as the Plan Administrator shall determine.  A Cash-Based Award may be paid in cash or
shares of Stock or in a combination of cash and Stock, as determined in the
sole discretion of the Plan Administrator.

 

B.            Other Equity Awards.
One or more shares of Stock may be granted to any Eligible Person, in such
amounts, on such terms and conditions, and for such consideration, including no
consideration as the Plan Administrator shall determine.  An Other Equity Award may be denominated in
Stock or other securities, stock-equivalent units, securities or debentures
convertible into Stock, or any combination of the foregoing and may be paid in
Stock or other securities, in cash, or in a combination of Stock or other
securities and cash, as determined in the sole discretion of the Plan
Administrator.

 

C.            Forfeiture of Payout of Award.  The Plan Administrator shall determine the
extent to which the Participant shall have the right to receive outstanding
Cash-Based Awards or Other Equity Awards or to have such Awards vest or payout,
as applicable, in the event a Participant ceases employment (or ceases board
membership in the case of a director or ceases the performance of services in
the case of a consultant).  Such
provisions shall be determined in the sole discretion of the Plan
Administrator, may be included in an agreement with the Participant reflecting
the terms of such Award, but need not be uniform among all such Awards, and may
reflect distinctions based on the reasons for the cessation.

 

 

13.           Performance Measures.

 

A.            General. 
Unless and until the Committee proposes for shareholder vote and the
shareholders approve a change in the general Performance Measures set forth in
this Section, the performance goals upon which the payment or vesting of an
Award to a Covered Employee that is intended to qualify as Performance-Based
Compensation shall be limited to goals set by reference to the following
Performance Measures: net earnings or net income (before or after taxes);
earnings per share; share price (including growth measures and total shareholder
return); net sales growth; net operating profit; capital targets (including
return on capital); return on assets; return on equity; earnings before or
after taxes, interest, depreciation and/or amortization; ongoing earnings; net
earnings; net sales growth; return on sales; cash flow (including operating
cash flow, free cash flow, discounted cash flow return on investment, cash flow
return on capital and cash flow in excess of costs of capital); economic value
added; value created; economic profit (net operating profit after tax, less a
cost of capital charge); shareholder value added; revenues; operating income;
pre-tax profit margin; gross margin; performance against business plan;
customer service; corporate governance quotient or rating; market share; productivity
ratios; operating efficiency; employee satisfaction; customer satisfaction;
safety; employee engagement; succession planning; supplier diversity; workforce
diversity; margins (including gross, future gross or operating margins); credit
rating; dividend payments; expenses (including targets or ratios); fuel cost
per million BTU; costs per kilowatt hour; retained earnings; completion of
acquisitions, divestitures, corporate restructurings, projects or other
specific events or transactions; and individual goals based on objective
business criteria underlying the goals listed above and which pertain to
individual effort as to achievement of those goals or to one or more business
criteria in the areas of litigation, human resources, information services,
production, inventory, support services, site development, plant development,
building development, facility development, government relations, product
market share or management.

 

In the event the
Committee intends that any Award under this Plan should qualify as
Performance-Based Compensation, such Awards shall be granted in accordance with
the additional requirements of this Section, which, in case of any conflict,
shall supersede any other provision of the Plan.  For Awards subject to Performance Measures
set forth in this Section, the Committee will establish (a) Performance
Target(s) relative to the applicable Performance Measures, (b) the
applicable Performance Period and (c) the applicable amount of cash or
number of shares that are the subject of the Award.  The applicable Performance Period and
Performance Target(s) shall be determined by the Committee consistent with
the terms of the Plan and Section 162(m) of the Code.  Notwithstanding the fact that the Performance
Target(s) have been attained, the Committee may pay an Award under this Section of
less than the amount determined by the formula or standard established pursuant
to this Section or may pay no Award at all.  Before any payments are made under this
Section, the Committee shall be responsible for certifying in writing to the
Company that the applicable Performance Targets have been met.

 

B.            Selection of Performance
Target(s).  The specific Performance Target(s) with
respect to the Performance Measures must be established by the Committee in
advance of the deadlines applicable under Section 162(m) of the Code
and while the performance relating to the Performance Target(s) remains
substantially uncertain within the meaning of Section 162(m) of the
Code.  The Performance Target(s) with
respect to any Performance Period may be established based on the performance
of the Company or a Subsidiary as a whole or any business unit of the Company
or a Subsidiary or any combination thereof, as the Committee may deem
appropriate, or on a cumulative basis or in the alternative, or as compared to
the performance of a group of comparator companies, or a published or special
index that the Committee, in its sole discretion, deems appropriate.  The Committee also has the authority to
provide for accelerated vesting of any Award based on the achievement of
performance goals pursuant to the Performance Measures specified in this Section 13.  The Committee also has the authority to use
any other performance measures in connection with Awards under the Plan that
are not intended to qualify as Performance-Based Compensation.  At the time the Performance Target(s) are
selected, the Committee shall provide, in terms of an objective formula or
standard for each Participant, the method of computing the specific amount that
will represent the maximum amount of Award payable to the Participant if the
Performance Target(s) are attained. 
The objective formula or standard shall preclude the use of discretion
to increase the amount of any Award earned pursuant to the terms of the Award.

 

 

C.            Evaluation of Performance For
Performance—Based Compensation.  The Committee
may provide in any such Award that any evaluation of performance may include or
exclude, in whole or in part, any one or more of the following with respect to
the Performance Period: (i) the gain, loss, income or expense resulting
from changes in tax laws or accounting principles or other laws or provisions
affecting reported results,  that become
effective during the Performance Period; (ii) the gain, loss, income or
expense with respect to the Performance Period that are extraordinary or
unusual in nature or infrequent in occurrence, including but not limited to
gain or loss on certain transactions that do not meet the definition of cash
flow hedges under U.S. generally accepted accounting principles and must be
recognized for financial statement purposes prior to financial statement
recognition of the gain or loss of the underlying transaction and also
including but not limited to any major corporate transaction-related costs; (iii) the
gains or losses resulting from, and the direct expenses incurred in connection
with mergers, acquisitions or  the
disposition of a business, in whole or in part, or the sale of investments or
non-core assets; (iv) gain or loss from all or certain claims and/or
litigation and all or certain insurance recoveries relating to claims or
litigation; (v) the impact of impairment of tangible or intangible assets
including but not limited to changes in valuation allowances for deferred income
tax assets; (vi) any impact of the phase-out of the tax credit for
synthetic fuel or any synthetic fuel earnings; (vii) the impact of
reorganization, restructuring or business recharacterization activities,
including but not limited to reductions in force; (viii) foreign exchange
gains and losses and (ix) the impact of investments or acquisitions made
during the year or, to the extent provided by the Committee, any prior
year.  Each of the adjustments described
in this Section 13C may relate to the Company as a whole or any part of
the Company’s business or operations, as determined by the Committee at the
time the Performance Targets are established. 
To the extent such adjustments affect Awards to Covered Employees, they
shall be prescribed in a form that meets the requirements of Code Section 162(m) for
deductibility. The adjustments are to be determined in accordance with U.S.
generally accepted accounting principles and standards, unless another
objective method of measurement is designated by the Committee.  In addition to the foregoing, the Committee
shall adjust any Performance Measures, Performance Targets or other features of
an Award that relate to or are wholly or partially based on the number of, or
the value of, any stock of the Company, to reflect any stock dividend or split,
recapitalization, combination or exchange of shares or other similar changes in
such stock.

 

D.  Committee Discretion to Determine Award.  The Committee has the sole
discretion to determine the standard or formula pursuant to which each
Participant’s Award shall be calculated, whether all or any portion of the
amount so calculated will be paid, and the specific amount (if any) to be paid
to each Participant, subject in all cases to the terms, conditions and limits
of the Plan.  To this same extent, the
Committee may at any time establish (and, once established, rescind, waive or
amend) additional conditions and terms of payment of Awards (including but not
limited to the achievement of other financial, strategic or individual goals,
which may be objective or subjective) as it may deem desirable in carrying out
the purposes of the Plan.  The Committee
may not, however, with respect to Performance-Based Compensation, increase the
maximum amount permitted to be paid to any individual under the Plan or pay
Awards under this Section 13 if the applicable Performance Target(s) have
not been satisfied.

 

In the event that the
requirements of Section 162(m) and the regulations thereunder change
to permit Committee discretion to alter the governing Performance Measures
without obtaining shareholder approval of such changes, the Committee shall
have sole discretion to make such changes without obtaining shareholder
approval.  In addition, in the event that
the Committee determines that it is advisable to grant Awards that shall not
qualify as Performance-Based Compensation and/or to amend previously granted
Awards in a way that would disqualify them as Performance-Based Compensation,
the Committee may make such grants without satisfying the requirements of Code Section 162(m) and
may base vesting on Performance Measures other than those set forth in Section 13A
and/or make such amendments.

 

14.                                 Accelerated Award Payout/Exercise.

 

A.            Adjustment
Upon Changes in Stock.  In the event of any change in the number of
shares of Stock outstanding by reason of any stock dividend or split,
recapitalization, merger, consolidation, 

 

 

combination
or exchange of shares or similar corporate change, the maximum aggregate number
of shares of Stock with respect to which the Committee may grant Awards and the
maximum aggregate number of shares of Stock with respect to which the Committee
may grant Awards to any individual Participant in any year shall be
appropriately adjusted by the Committee. 
In the event of any change in the number of shares of Stock outstanding
by reason of any other similar event or transaction, the Committee may, but
need not, make such adjustments in the number and class of shares of Stock with
respect to which Awards may be granted as the Committee may deem appropriate.

 

B.            Increase
or Decrease in Issued Shares Without Consideration.
Subject  to any required action by the
shareholders of the Company, in the event of any increase or decrease in the
number of issued shares of Stock resulting from a subdivision or consolidation
of shares of Stock or the payment of a stock dividend (but only on the shares
of Stock), or any other increase or decrease in the number of such shares
effected without receipt or payment of consideration by the Company, the
Committee shall proportionally adjust the number of shares of Stock subject to
each outstanding Award and the exercise price per share of Stock of each such
Award.

 

C.            Certain Mergers.  Subject to any required action by the
shareholders of the Company, in the event that the Company shall be the
surviving corporation in any merger, consolidation or similar transaction as a
result of which the holders of shares of Stock receive consideration consisting
exclusively of securities of such surviving corporation, the Committee shall
adjust each Award outstanding on the date of such merger or consolidation so
that it pertains to and applies to the securities which a holder of the number
of shares of Stock subject to such Award would have received in such merger or
consolidation.

 

D.            Certain Other
Transactions.

 

In the event of (i) a dissolution or liquidation
of the Company, (ii) a sale of all or substantially all of the Company’s
assets (on a consolidated basis), (iii) a merger, consolidation or similar
transaction involving the Company in which the Company is not the surviving
corporation or (iv) a merger, consolidation or similar transaction
involving the Company in which the Company is the surviving corporation but the
holders of shares of Stock receive securities of another corporation and/or
other property, including cash, the Committee shall, in its discretion, have
the power to:

 

(i)  cancel,
effective immediately prior to the occurrence of such event, each Award
(whether or not then exercisable), and, in full consideration of such
cancellation, pay to the Participant to whom such Award was granted an amount
in cash, for each share of Stock subject to such Award equal to the value, as
determined by the  Committee in its
discretion, of such Award, provided that with respect to any outstanding Option
such value shall be equal to the excess of (A) the value, as determined by
the Committee in its discretion, of the property (including cash) received by
the holder of a share of Stock as a result of such event over (B) the
exercise price of such Option; or

 

(ii)  provide for
the exchange of each Award (whether or not then exercisable or vested) for an
incentive award with respect to, as appropriate, some or all of the property
which a holder of the number of shares of Stock subject to such Award would
have received in such transaction and, incident thereto, make an equitable
adjustment as determined by the Committee in its discretion in the exercise
price of the incentive award, or the number of shares or amount of property
subject to the incentive award or, if appropriate, provide for a cash payment
to the Participant to whom such Award was granted in partial consideration for
the exchange of the Award.

 

E.             Other Changes. 
In the event of any change in the capitalization of the Company or
corporate change other than those specifically referred to in paragraphs B, C
or D, the Committee may, in its discretion, make such adjustments in the number
and class of shares subject to Awards outstanding on the date on which such
change occurs and in such other terms of such Awards as the Committee may
consider appropriate.

 

 

F.             No Other Rights. 
Except as expressly provided in the Plan, no Participant shall have any
rights by reason of any subdivision or consolidation of shares of stock of any
class, the payment of any dividend, any increase or decrease in the number of
shares of stock of any class or any dissolution, liquidation, merger or
consolidation of the Company or any other corporation.  Except as expressly provided in the Plan, no
issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number of shares or amount
of other property subject to any Award.

 

G.            Change in Control.  Unless otherwise determined
by the Committee in connection with the grant of an Award, or
unless the Participant and the Company agree in writing that the provisions of
this Section 14G shall not apply, the following provisions shall apply
upon the occurrence of a Change in Control of the Company:

 

i.                  Restricted Stock, Restricted Stock Unit,
Cash-Based, or Other Equity Awards Subject to Service-Based Restrictions on
Vesting. A
prorata portion of all outstanding Restricted Stock, Restricted Stock Unit,
Cash-Based or Other Equity Awards subject to service-based restrictions on
vesting will be immediately and fully vested and earned, with the prorata
portion determined based on the number of months in the restriction period that
have elapsed as of the date of the Change in Control as compared to the total
number of months in the restriction period. 
The amount of the Award not so vested shall remain outstanding (on a
converted basis, if applicable) in accordance with the original terms of the
Award.

 

ii.               Stock Option Awards and Stock
Appreciation Rights.  Any previously granted Stock Option Awards or
Stock Appreciation Rights will be immediately and fully vested and will become
fully exercisable.

 

iii.            Restricted Stock, Restricted Stock Unit,
Cash-Based, or Other Equity Awards with Restrictions Based on Achievement of
Performance Goals/Performance Units.  The
Participant will be entitled to an immediate accelerated vesting and payout of
Performance Unit, Restricted Stock, Restricted Stock Unit, Cash-Based or Other
Equity Awards with restrictions based on achievement of performance goals, and
the amount of the accelerated vesting and payout will be based on the number of
such Restricted Stock or Restricted Stock Units/Performance Units subject to
the Award as established on the Date of Grant, prorated based on the number of
months of the Performance Period that have elapsed as of the date of the Change
in Control as compared to the total number of months in the Performance Period,
and assuming maximum performance was achieved.  
Applicable payouts shall be made in the form set forth in the original
terms of the grant.  The amount of the
Award not so vested shall remain outstanding (on a converted basis, if applicable)
in accordance with the original terms of the grant.

 

H.            Savings Clause.  No provision of this Section 14 shall be given
effect to the extent that such provision would cause any tax to become due
under Section 409A of the Code.

 

15.                                 Amendment of Plan.

 

The
Committee may at any time and from time to time alter, amend, suspend or
terminate the Plan in whole or in part, except (i) no such action may be
taken without stockholder approval which materially increases the number of
securities which may be issued pursuant to the Plan (except as provided in Section 14A
- E), extends the period for granting Options under the Plan or materially
modifies the requirements as to eligibility for participation in the Plan; (ii) no
such action may be taken without the consent of the Participant to whom any
Award was previously granted, which materially adversely affects the rights of
such Participant concerning such Award, except as such alteration, termination,
suspension or amendment of the Plan is required by statute, or rules and
regulations promulgated thereunder; and (iii) no such action that would
require the consent of the Board and/or the stockholders of the Company
pursuant to Section 162(m) of the Code or the 1934 Act, or any other
applicable law, rule, or regulation, or the requirements of

 

 

any
securities exchange on which shares of stock are traded, shall be effective
without such consent.  Notwithstanding
the foregoing, except as otherwise required by applicable law, rule or
regulation, the Committee may amend the Plan at its discretion to (i) address
any issues concerning Section 162(m) of the Code; (ii) comply
with applicable laws, rules or regulations and changes thereto; or (iii) maintain
an exemption under rule 16b-3 of the 1934 Act. No provision of this Section 14
shall be given effect to the extent that such provision would cause any tax to
become due under Section 409A of the Code.

 

16.                                 Miscellaneous Provisions.

 

A.            Nontransferability.  No benefit provided under this Plan shall be
subject to alienation or assignment by a Participant (or by any person entitled
to such benefit pursuant to the terms of this Plan), nor shall it be subject to
attachment or other legal process except (i) to the extent specifically
mandated and directed by applicable state or federal statute; (ii) as
requested by the Participant (or by any person entitled to such benefit
pursuant to the terms of this Plan), and approved by the Committee, to satisfy
income tax withholding; and (iii) as requested by the Participant and
approved by the Committee, to members of the Participant’s family, or a trust
established by the Participant for the benefit of family members.

 

B.            No Employment Right.  Participation in this Plan shall not
constitute a contract of employment between the Company or any Subsidiary and
any person and shall not be deemed to be consideration for, or a condition of,
continued employment of any person.

 

C.            Tax Withholding. 
The Company or a
Subsidiary may withhold any applicable federal, state or local taxes at such time
and upon such terms and conditions as required by law or determined by the
Company or a Subsidiary.  Subject to
compliance with any requirements of applicable law, the Plan Administrator may
permit or require a Participant to have any portion of any withholding or other
taxes payable in respect to a distribution of Stock satisfied through the
payment of cash by the Participant to the Company or a Subsidiary, the
retention by the Company or a Subsidiary of shares of Stock, or delivery of
previously owned shares of the Participant’s Stock, having a Fair Market Value
equal to the withholding amount.

 

D.            Fractional Shares.  Any fractional shares concerning Awards shall
be eliminated at the time of payment or payout by rounding down for fractions
of less than one-half and rounding up for fractions of equal to or more than
one-half.  No cash settlements shall be
made with respect to fractional shares eliminated by rounding.

 

E.             Government and Other Regulations.  The obligation of the Company to make payment
of Awards in Stock or otherwise shall be subject to all applicable laws, rules,
and regulations, and to such approvals by any government agencies as may be
required. The Company shall be under no obligation to register under the
Securities Act of 1933, as amended (“Act”), any of the shares of Stock issued,
delivered or paid in settlement under the Plan. 
If Stock awarded under the Plan may in certain circumstances be exempt
from registration under the Act, the Company may restrict its transfer in such
manner as it deems advisable to ensure such exempt status.  Notwithstanding anything herein to the
contrary, the Company shall not be obligated to cause to be issued or delivered
any certificates evidencing shares of Stock pursuant to the Plan unless and
until the Company is advised by its counsel that the issuance and delivery of
such certificates is in compliance with all applicable laws, regulations of
governmental authority and the requirements of any securities exchange on which
shares of Stock are traded.

 

The
exercise of any Option or Stock Appreciation Right granted under the Plan shall
only be effective at such time as counsel to the Company shall have determined
that the issuance and delivery of shares of Stock pursuant to such exercise is
in compliance with all applicable laws, regulations of governmental authority
and the requirements of any securities exchange on which shares of Stock are
traded.  The Company may, in its
discretion, defer the effectiveness of an exercise of an Option or Stock
Appreciation Right hereunder or the issuance or transfer of shares of Stock
pursuant to any Award pending or to ensure compliance under federal or state
securities laws or the rules or regulations of any exchange on which the
shares are then listed 

 

 

for
trading.  The Company shall inform the
Participant in writing of its decision to defer the effectiveness of the
exercise of an Option or Stock Appreciation Right or the issuance or transfer
of shares of Stock pursuant to any Award. 
During the period that the effectiveness of the exercise of an Option or
Stock Appreciation Right has been deferred, the Participant may, by written
notice, withdraw such exercise and obtain the refund of any amount paid with
respect thereto.

 

F.             Compliance with Section 409A of the Code.  This Plan is intended to comply and
shall be administered in a manner that is intended to comply with section 409A
of the Code and shall be construed and interpreted in accordance with such
intent.  To the extent that an Award,
issuance and/or payment is subject to section 409A of the Code, it shall be
awarded and/or issued or paid in a manner that will comply with section 409A of
the Code, including proposed, temporary or final regulations or any other
guidance issued by the Secretary of the Treasury and the Internal Revenue
Service with respect thereto.  Any
provision of this Plan that would cause an Award, issuance and/or payment to
fail to satisfy section 409A of the Code shall have no force and effect until
amended to comply with Code section 409A (which amendment may be retroactive to
the extent permitted by applicable law).

 

G.            Indemnification.  Each person who is or at any time serves as a
member of the Committee (and each person or committee to whom the Committee or
any member thereof has delegated any of its authority or power under this Plan)
shall be indemnified and held harmless by the Company against and from (i) any
loss, cost, liability, or expense that may be imposed upon or reasonably
incurred by such person in connection with or resulting from any claim, action,
suit, or proceeding to which such person may be a party or in which such person
may be involved by reason of any action or failure to act under the Plan; and (ii) any
and all amounts paid by such person in satisfaction of judgment in any such
action, suit, or proceeding relating to the Plan.  Each person covered by this indemnification
shall give the Company an opportunity, at its own expense, to handle and defend
the same before such person undertakes to handle and defend it on such person’s
own behalf.  The foregoing right of
indemnification shall not be exclusive of any other rights of indemnification
to which such persons may be entitled under the Charter or By-Laws of the
Company or any of its Subsidiaries, as a matter of law, or otherwise, or any
power that the Company may have to indemnify such person or hold such person
harmless.

 

H.            Reliance on Reports.  Each member of the Committee (and each person
or committee to whom the Committee or any member thereof has delegated any of its
authority or power under this Plan) shall be fully justified in relying or
acting in good faith upon any report made by the independent registered public
accounting firm of the Company and its Subsidiaries and upon any other
information furnished in connection with the Plan.  In no event shall any person who is or shall
have been a member of the Committee be liable for any determination made or
other action taken or any omission to act in reliance upon any such report or
information or for any action taken, including the furnishing of information,
or failure to act, if in good faith.

 

I.              Severability. 
If any provision of this
Plan would cause Awards intended  to
qualify as Performance-Based Compensation to not so qualify, that provision
shall be severed from, and shall be deemed not to be a part of, the Plan, but
the other provisions hereof shall remain in full force and effect.  Any specific action by the Committee that
would be violative of Section 162(m) with respect to Awards intended
to qualify as Performance-Based Compensation shall be void.

 

J.             Company Successors.  In the event the Company becomes a party to a
merger, consolidation, sale of substantially all of its assets or any other
corporate reorganization in which the Company will not be the surviving
corporation or in which the holders of the Stock will receive securities of
another corporation (in any such case, the “New Company”), then the New Company
shall assume the rights and obligations of the Company under this Plan.

 

K.            Governing Law.  All matters relating to the Plan or to Awards
granted hereunder shall be governed by the laws of the State of Maryland,
without regard to the principles of conflict of laws.

 

 

L.             Relationship to Other Benefits.  Any Awards under this Plan are not considered
compensation for purposes of determining benefits under any pension, profit
sharing, or other retirement or welfare plan, or for any other general employee
benefit program.

 

M.           Expenses.  The expenses of administering the Plan shall
be borne by the Company and its Subsidiaries.

 

N.            Titles and Headings. 
The titles and headings of the sections in the Plan are for convenience
of reference only, and in the event of any conflict, the text of the Plan,
rather than such titles or headings, shall control.

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