Document:

Exhibit 10.13

 

AMENDED AND RESTATED 2003 STOCK PURCHASE AND
OPTION PLAN

FOR KEY EMPLOYEES OF

ITC HOLDINGS CORP. AND ITS SUBSIDIARIES

 

1.                                       Purpose
of Plan

 

The Amended and Restated 2003 Stock Purchase and Option Plan for Key
Employees of ITC Holdings Corp. and Its Subsidiaries (the “Plan”) is designed:

 

(a)                                  to
promote the long term financial interests and growth of ITC Holdings Corp. (the
“Company”) and its Subsidiaries (including, without limitation, International
Transmission Company (“ITC”)), by attracting and retaining management and other
personnel with the training, experience and ability to enable them to make a
substantial contribution to the success of the Company’s business;

 

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

 

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

 

2.                                       Definitions

 

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

 

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

 

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

 

(c)                                  “Change
of Ownership” means (i) the sale of all or substantially all of the assets of
the Company or ITC to an Unaffiliated Person; (ii) a sale resulting in more
than 50% of the voting stock of the Company or ITC being held by an Unaffiliated
Person; (iii) a merger, consolidation, recapitalization or reorganization of
the Company or ITC with or into another Unaffiliated Person; if and only if any such event listed in
clauses (i) through (iii) above results in the inability of ITH LP, Ironhill,
the Limited Partner Group, or any member or members of the Limited Partner
Group, to designate or elect a majority of the Board (or the board of directors
of the resulting entity or its parent company). 
For purposes of this definition, the term “Unaffiliated Person”
means any Person or Group who is not (x) ITH LP, Ironhill, the Limited Partner
Group or any member of the Limited Partner Group, (y) an Affiliate of ITH LP,
Ironhill, the Limited Partner Group or any member of the Limited Partner Group,
or (z) an entity in which ITH LP, Ironhill, the Limited Partner Group, or any
member of the Limited Partner Group holds, directly or indirectly, a majority
of the economic interests in such entity.

 

(d)                                 “Committee”
means the Compensation Committee of the Board.

 

 

(e)                                  “Common
Stock” or “Share” means common stock of the Company, which may be authorized
but unissued, or issued and reacquired.

 

(f)                                    “Employee”
means a person, including an officer, in the regular employment of the Company
or one of its Subsidiaries who, in the opinion of the Committee, is, or is
expected to have involvement in the management, growth or protection of some
part or all of the business of the Company.

 

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

 

(h)                                 “Fair
Market Value” means the last reported sale price of a Share as reported by the
principal stock exchange on which the Common Stock is listed  or if the Common Stock is not listed on a
stock exchange, as determined in accordance with any applicable resolutions or
regulations of the Committee in effect at the relevant time.

 

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

 

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

 

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

 

(l)                                     “Ironhill”
means Ironhill Transmission LLC, which is the general partner of ITH LP, of
which the Company is a majority-owned Subsidiary.

 

(m)                               “ITH
LP” means International Transmission Holdings Limited Partnership, a Michigan
limited partnership.

 

(n)                                 “Limited
Partner Group” shall mean the KKR Millennium Fund L.P., KKR Partners III, L.P.
(Series A) and Trimaran Capital Partners, collectively.

 

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

 

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

 

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

 

 

(r)                                    “Trimaran
Capital Partners” means, collectively, Trimaran Fund II, L.L.C., Trimaran
Parallel Fund II, L.P., Trimaran Capital, L.L.C., CIBC Employee Private Equity
Fund (Trimaran) Partners and CIBC MB Inc.

 

3.                                       Administration
of Plan

 

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

 

(b)                                 The
Committee may delegate to the Chief Executive Officer and to other senior
officers of the Company its duties under the Plan subject to such conditions
and limitations as the Committee shall prescribe except that only the Committee
may designate and make Grants to Participants who are subject to Section 16
of the Exchange Act.

 

(c)                                  The
Committee may employ counsel, consultants, accountants, appraisers, brokers or
other persons.  The Committee, the
Company, and the officers and directors of the Company shall be entitled to
rely upon the advice, opinions or valuations of any such persons.  All actions taken and all interpretations and
determinations made by the Committee in good faith shall be final and binding
upon all Participants, the Company and all other interested persons.  No member of the Committee shall be
personally liable for any action, determination or interpretation made in good
faith with respect to the Plan or the Grants, and all members of the Committee
shall be fully protected by the Company with respect to any such action,
determination or interpretation.

 

4.                                       Eligibility

 

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

 

5.                                       Grants

 

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

 

(a)                                  Stock
Options - These are options to purchase Common Stock.  At the time of Grant the Committee shall
determine, and shall include in the Grant Agreement or in the Plan rules, the
option exercise period, vesting requirements, and such other terms, conditions
or

 

 

restrictions on the grant or
exercise of the option as the Committee deems appropriate including, without
limitation, the right to receive dividend equivalent payments on vested and/or
unvested options; provided, however, that in no event shall any
option exercise price be less than the Fair Market Value of a Share on the date
the relevant option is granted.  In
addition to other restrictions contained in the Plan, an option granted under this
Section 5(a) may not be exercised more than 10 years after the date it is
granted.  Unless otherwise permitted by
the Committee, payment of the option exercise price shall be made in cash, in
accordance with the terms of the Plan, the Grant Agreement and of any
applicable guidelines of the Committee in effect at the time.

 

(b)                                 Stock
Appreciation Rights - The Committee may grant Stock Appreciation Rights in
connection with the grant of a Stock Option. 
Each Stock Appreciation Right shall be subject to such other terms as
the Committee may determine.  A Stock
Appreciation Right means the right to transfer and surrender to the Company all
or a portion of a Stock Option in exchange for a cash amount equal to the
excess of (i) the aggregate Fair Market Value, as of the date such Option or
portion thereof is transferred or surrendered, of the Common Stock underlying
by such Option or portion thereof, over (ii) the aggregate exercise price of
such Option or portion thereof, relating to such Common Stock.

 

(c)                                  Purchase
Stock - Purchase Stock are Shares offered to a Participant at such price as
determined by the Committee, the acquisition of which may make the Participant
eligible to receive Grants under the Plan, including, but not limited to, Stock
Options.

 

(d)                                 Restricted
Stock – Restricted Stock are Shares granted by the Committee to a
Participant, without charge to the Participant (other than as may be required
by applicable law).  The Restricted Stock
shall be subject to such other terms as the Committee may determine.

 

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

 

6.                                       Limitations
and Conditions

 

(a)                                  The
number of Shares available for Grants under this Plan shall be 1,000,000.  Unless restricted by applicable law, Shares
related to Grants that are forfeited, terminated, canceled or expire
unexercised, shall immediately become available for new Grants.

 

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

 

(c)                                  Nothing
contained herein shall affect the right of the Company or any of its
Subsidiaries to terminate any Participant’s employment at any time or for any
reason.

 

 

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

 

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

 

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

 

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

 

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

 

7.                                       Transfers
and Leaves of Absence

 

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

 

8.                                       Adjustments

 

In the event of any change in the outstanding Common Stock by reason of
a stock split, spin-off, extraordinary dividend, stock dividend, stock
combination, reclassification, recapitalization, liquidation, dissolution,
reorganization, merger, Change of Ownership, or other event affecting the
capital stock of the Company, the Committee may adjust appropriately (a) the
number and kind of shares subject to the Plan and available for or covered by
Grants and (b) share prices related to outstanding Grants, and make such other
revisions to outstanding Grants as it

 

 

deems, in good faith, are equitably required (including, without
limitation, to the exercise price of Stock Options).

 

9.                                       Merger,
Consolidation, Exchange, Acquisition, Liquidation or Dissolution

 

In its absolute discretion, acting in good faith, and on such terms and
conditions as it deems appropriate, coincident with or after the grant of any
Grant, the Committee may provide that such Grant cannot be exercised after the
amalgamation, merger or consolidation of the Company with or into another
corporation, the exchange of all or substantially all of the assets of the
Company for the securities of another corporation, the acquisition by another
corporation of 80% or more of the Company’s then outstanding shares of voting
stock or the recapitalization, reorganization, reclassification, liquidation,
dissolution, or other event affecting the capital stock of the Company, and the
Committee shall, on such terms and conditions as it deems appropriate, acting
in good faith, also provide, either by the terms of such Grant or by a
resolution adopted prior to the occurrence of such amalgamation, merger,
consolidation, exchange, acquisition, recapitalization, reorganization,
reclassification, liquidation, dissolution or other event affecting the capital
stock of the Company, that, after written notice to all affected Participants
and for a reasonable period of time prior to such event, such Grant shall be
exercisable as to any Shares subject thereto which is being made unexercisable
after any such event, notwithstanding anything to the contrary herein (but
subject to the provisions of Section 6(b)) and that, upon the occurrence
of such event, such Grant shall terminate and be of no further force or effect;
provided, however, that the Committee may also provide, in its
absolute discretion, that (a) even if the Grant shall remain exercisable after
any such event, from and after such event, any such Grant shall be exercisable
only for, or (b) the Grant may be cancelled as of the date of such event only
in exchange for, the kind and amount of securities and/or other property, or
the cash equivalent thereof (as determined by the Committee in good faith),
receivable as a result of such event by the holder of a number of Shares for
which such Grant could have been exercised immediately prior to such event.

 

10.                                 Amendment
and Termination

 

(a)                                  The
Committee shall have the authority to make such amendments to any terms and
conditions applicable to outstanding Grants as are consistent with this Plan
provided that no such action shall modify any Grant in a manner adverse to the
Participant without the Participant’s consent except as such modification is
provided for or contemplated in the terms of the Grant or this Plan (except
that any adjustment that is made pursuant to Section 8 or 9 hereof may be
made by the Committee in good faith).

 

(b)                                 The
Board of Directors may amend, suspend or terminate the Plan except that no such
action, other than an action under Section 8 or 9 hereof or as may be
required to cause the Plan to comply with applicable law, may be taken which
would, without shareholder approval, increase the aggregate number of Shares
available for Grants under the Plan, decrease the price of outstanding Grants,
change the requirements relating to the Committee, extend the term of the Plan
or be materially adverse to all Participants with respect to any outstanding
Grants.

 

 

11.                                 Governing
Law; Foreign Options and Rights

 

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

 

(b)                                 The
Committee may make Grants to Employees who are subject to the laws of
jurisdictions other than those of Michigan or the United States, which Grants
may have terms and conditions that differ from the terms thereof as provided
elsewhere in the Plan for the purpose of complying with foreign laws or otherwise
as deemed to be necessary or desirable by the Committee.

 

12.                                 Withholding
Taxes

 

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

 

13.                                 Effective
Date and Termination Dates

 

The Plan became effective on February 25,
2003 and shall terminate on February 25, 2013, subject to earlier
termination by the Board pursuant to Section 10.

 

Original Plan approved by
stockholders on February 25, 2003.

 

Amended and Restated Plan
approved by stockholders on April    , 2005.Exhibit 10.14

 

ITC HOLDINGS CORP.

SPECIAL BONUS PLAN

 

 

JUNE 15, 2005

 

 

ARTICLE I

INTRODUCTION

 

The Plan is established effective as of June 15,
2005 by ITC Holdings Corp. for the purpose of providing special bonuses to executives
of ITC Holding Corp. and its Subsidiaries.

 

ARTICLE II

DEFINITIONS

 

The following capitalized terms used in the
Plan have the respective meanings set forth in this Article II:

 

2.1.                              “Affiliate” shall mean with respect to any Person, any
entity directly or indirectly controlling, controlled by or under common
control with such Person.

 

2.2.                              “Beneficiary” shall mean such person or legal entity
as may be designated by a Participant under Section 5.2 to receive
benefits hereunder after such Participant’s death or Permanent Disability.

 

2.3.                              “Board” shall mean the board of directors of the
Company (or any successor entity thereto).

 

2.4.                              “Change in Control” means, and occurs on,: (i) the
date that any one Person, or more than one Person acting as a Group, acquires
ownership of stock of the Company that, together with stock held by such Person
or Group, constitutes more than fifty percent (50%) of the total fair market
value or total voting power of the stock of the company; (ii) the date that
either: (A) any one Person, or more than one Person acting as a Group, acquires
(or has acquired during the 12-month period ending on the date of the most
recent acquisition by such Person or Persons) ownership of Company stock
representing thirty-five percent (35%) or more of the total voting power, or
(B) a majority of members of the Company’s Board of Directors is replaced
during any 12-month period by directors whose appointment or election is not
endorsed by a majority of the directors in office prior to the date of the
appointment or election; or (iii) the date that any one Person, or more than
one Person acting as a group acquires (or has acquired during the 12-month
period ending on the date of the most recent acquisition by such person or
persons) assets from the corporation that have a total gross fair market value
equal to or more than 40 percent of the total gross fair market value of all of
the assets of the corporation immediately prior to such acquisition or
acquisitions.

 

2.5.                              “Committee” shall mean the compensation committee of
the Board.

 

2.6.                              “Common Stock” or “Share” shall mean common
stock of the Company.

 

2.7.                              “Company” shall mean ITC Holdings Corp., its
successors and assigns.

 

2.8.                              “Eligible Employee”
shall mean an active Employee who holds outstanding Options.

 

 

2.9.                              “Employee” shall mean
a Person who is currently employed by the Company.

 

2.10.                        “Employer” shall mean the Company and each Subsidiary
or Affiliate of the Company designated by the Company that employs one or more
Eligible Employees who have become Participants in accordance with Article III.

 

2.11.                        “Exchange Act” shall mean The Securities Exchange Act
of 1934, as amended, or any successor thereto.

 

2.12.                        “Fair Market Value Per Share” means (a) the last reported
sale price of a Share as reported by the principal stock exchange on which the
Common Stock is listed, or (b) if the Common Stock is not so listed, as
determined in accordance with any applicable resolutions or regulations of the
Board in effect at the relevant date.

 

2.13.                        “Group” shall mean “group”
as such term is used for purposes of Section 13(d) or 14(d) of the
Exchange Act.

 

2.14.                        “Option Plan” shall
mean the Amended and Restated 2003 Stock Purchase and Option Plan of ITC
Holdings and Its Subsidiaries, as from time to time amended.

 

2.15.                       “Options” shall mean
those outstanding, unexercised options to purchase Common Stock granted to any
Participant under the Option Plan.

 

2.16.                        “Participant” shall mean an Eligible Employee who is
selected by the Committee to participate in the Plan.

 

2.17.                        “Permanent Disability” shall mean either: (i) that the
Participant is unable to engage in any substantial gainful activity by reason
of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period
of not less than twelve months, or (ii) the Participant is, by reason of any
medically determinable physical or mental impairment which can be expected to
result in death or can be expected to last for a continuous period of not less
than twelve months, receiving income replacement benefits for a period of not
less than three months under an accident and health plan covering employees of
the Company.

 

2.18.                        “Person” shall mean a Person as such term is used for
purposes of Section 13(d) or 14(d) of the Exchange Act.

 

2.19.                        “Plan” shall mean the ITC Holdings Corp Special Bonus
Plan, as amended from time to time.

 

2.20.                        “Plan Year” shall mean, for the first Plan Year, the
period beginning June 15, 2005 and ending December 31, 2005, and
thereafter, the period beginning January 1 and ending December 31 of
each calendar year.

 

2.21.                        “Record Date” shall mean any given record date
established by the Board for purposes of calculating and paying dividends on
the then outstanding shares of Common Stock.

 

 

2.22.                        “Special Bonus Account” shall mean the notional
account established and maintained by the Company for each Participant, as
described in Article IV of the Plan. 
Special Bonus Accounts shall be maintained solely as bookkeeping entries
to evidence unfunded obligations of the Company.

 

2.23.                        “Special Bonus Amount” shall mean a bookkeeping entry credited
to a Participant’s Special Bonus Account representing a special bonus awarded by
the Board to the Participant.

 

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

 

ARTICLE III

PARTICIPATION BY ELIGIBLE EMPLOYEES

 

3.1                                 Participation.  Participation in the Plan is limited to
Eligible Employees. An Eligible Employee shall be selected to participate in
the Plan as determined by the Committee in its sole discretion This Plan is
intended to be limited to a select group of management or highly compensated
employees of the Employers.  To the
extent that the Committee determines that an employee no longer qualifies as
part of such a group, the Committee can provide that such employee is
ineligible for additional credits under the Plan.

 

3.2                                 Continuity of Participation.
 A Participant who separates from service
with all of the Employers shall immediately cease active participation under
the Plan.  Unless otherwise determined by
the Committee, however, the separation from service of a Participant with one
Employer will not interrupt the continuity of the Participant’s active
participation in the Plan if, concurrently with such separation or as part of a
coordinated transfer from one Employer to another, the Participant is employed
by one or more of the other Employers.

 

ARTICLE IV

SPECIAL BONUS AMOUNTS AND
SPECIAL BONUS ACCOUNTS

 

4.1.                              Special Bonus Amounts.  For each Plan Year, the Committee, in its
sole discretion, shall determine with respect to each Eligible Employee whether
such Eligible Employee shall be entitled to a Special Bonus Amount for such
Plan Year and, if so, in what amount.  In
determining the amount of the Special Bonus Amount, the Board shall give
consideration to dividends paid, or expected to be paid, on Common Stock during
such Plan Year and to the number of Options issued and outstanding to each
Eligible Employee during such Plan Year. 
Neither such factors, nor the fact that an Eligible Employee has been
granted a Special Bonus Amount with respect to prior Plan Years shall in any
way restrict the Committee’s discretion with respect to Special Bonus Amounts.

 

4.2.                              Establishment of Special Bonus Accounts.  A Special Bonus
Account will be established for each Participant, as determined by the
Committee.  To the extent that an
Eligible

 

 

Employee is designated as entitled to receive a Special Bonus
Amount for a Plan Year, the Eligible Employee’s Special Bonus Account shall be
credited with such Special Bonus Amount from time to time, as provided in the
award of the Special Bonus Amount.

 

4.3.                              Election of Investment Options.  Each Participant shall, by filing an election
with the Company, in a format approved by the Company, elect the investment
options in which each Special Bonus Amount is to be invested.  Investment options available under the Plan
and the ability to change such investment elections shall be at the discretion
of the Committee.  Participants shall
bear the investment risk in their Special Bonus Account.

 

ARTICLE V

DISTRIBUTIONS

 

5.1.                              Distribution Date.  Unless otherwise provided in this Article V,
distribution of the Special Bonus Account shall be made to each Participant in
accordance with Section 5.4, upon the fifth anniversary of the date on
which each such Participant was first granted an Option under the Option
Plan.  Participant’s not employed on the
fifth anniversary of the date of their Option grant will forfeit their Special
Bonus Account.

 

5.2.                              Distributions
on Death or Permanent Disability.  In the event of a Participant’s death or
Permanent Disability before the Participant’s Special Bonus Account otherwise
has been distributed, distribution of the Participant’s entire account balance
shall be made as soon as administratively feasible to each Participant or the
Beneficiary selected by the Participant. 
Each Participant shall have a right to designate a beneficiary with
respect to amounts payable under the Plan. 
A Participant may from time to time change the Participant’s designated
Beneficiary without the consent of such Beneficiary by filing a new designation
in writing with the Company or its designee. 
If no Beneficiary designation is in effect at the time of the
Participant’s death, or if the designated Beneficiary is missing or has
predeceased the Participant, distribution shall be made to the Participant’s
estate.

 

5.3.                              Effect of Change in Control.  Upon the occurrence of a Change in Control,
all Participants shall become fully vested in their Special Bonus Accounts and
shall receive distribution of their entire account balances in accordance with Section 5.4.

 

5.4.                              Method and Timing of Payment.  All distributions under the Plan shall be in
the form of a lump sum cash payment, not later than fifteen (15) business days
after the applicable Distribution Date.

 

ARTICLE VI

FUNDING AND PARTICIPANT’S
INTEREST

 

The Plan shall be unfunded and the Company
shall pay all distributions from its general assets; and a Participant (or the
Participant’s Beneficiary) shall have the rights of a general, unsecured
creditor against the Company for any distributions due hereunder.

 

 

ARTICLE VII

ADMINISTRATION AND
INTERPRETATION

 

7.1.                              Administration.  The Committee shall be responsible for administering
the Plan. However, the Committee may delegate its duties and powers in whole or
in part as it determines. The Committee has full discretionary authority to
construe and interpret the terms and provisions of the Plan; to adopt, alter
and repeal administrative rules, guidelines and practices governing the Plan;
to perform all acts, including the delegation of its administrative
responsibilities to advisors or other persons who may or may not be employees
of the Employers; and to rely upon the information or opinions of legal counsel
or experts selected to render advice with respect to the Plan, as it shall deem
advisable, with respect to the administration of the Plan.

 

7.2.                              Interpretation.  The Committee may take any action, correct any
defect, supply any omission or reconcile any inconsistency in the Plan or in
any election hereunder, in the manner and to the extent it shall deem necessary
to carry the Plan into effect or to carry out the Company’s purposes in
adopting the Plan.  Any decision,
interpretation or other action made by the Committee arising out of or in
connection with the Plan, shall be final, binding and conclusive on the
Employers and all Participants and Beneficiaries and their respective heirs,
executors, successors and assigns.  The
Committee’s determinations hereunder need not be uniform, and may be made
selectively among Eligible Employees, whether or not they are similarly
situated.

 

7.3.                              Claims Procedure.  If a claim for benefits or for participation
under the Plan is denied in whole or in part, a Participant will receive
written notification.  The notification
will include specific reasons for the denial, specific reference to pertinent
provisions of the Plan, a description of any additional material or information
necessary to process the claim and why such material or information is
necessary, and an explanation of the claims review procedure.  If the Committee (or its designated
administrator) fails to respond within 90 days, the claim is treated as denied.

 

7.4.                              Review Procedure.  Within 60 days after the claim is denied or,
if the claim is deemed denied, within 150 days after the claim is filed, a
Participant (or the Participant’s duly authorized representative) may file a
written request with the Committee (or its designated administrator) for a
review of his denied claim. The Participant may review pertinent documents that
were used in processing the Participant’s claim, submit pertinent documents,
and address issues and comments in writing to the Committee.  The Committee will notify the Participant of
its final decision in writing.  In its
response, the Committee will explain the reason for the decision, with specific
references to pertinent Plan provisions on which the decision was based.  If the Committee (or its designated
administrator) fails to respond to the request for review within 60 days, the
review is treated as denied.

 

ARTICLE VIII

AMENDMENT AND TERMINATION

 

8.1.                              Amendment and Termination.
 The Committee shall have the right, at
any time, to amend or terminate the Plan, in whole or in part, provided
that such amendment or termination shall not materially and adversely affect
the accrued and vested rights of any Participant or

 

 

Beneficiary under the Plan.  Notwithstanding the foregoing, the Committee
shall have the right to amend the Plan in such manner as it deems necessary to
preserve all applicable laws and/or favorable accounting treatment by the
Company of the benefits provided under this Plan (including, without
limitation, to make any amendment to this Plan that would be necessary in order
to cause the Plan, in form and/or in operation, to be compliant with Section 409A
of the U.S. Internal Revenue Code of 1986, as amended, and to avoid any tax
thereunder being imposed on any Participant).  The Company reserves the right, in its sole
discretion, to discontinue the crediting of Special Bonus Amounts, or
completely terminate the Plan at any time.

 

ARTICLE IX

MISCELLANEOUS PROVISIONS

 

9.1.                             Right to
Employment.  The
adoption and maintenance of the Plan shall not be deemed to constitute a
contract between an Employer and any Eligible Employee, or to be a
consideration for, or an inducement or condition of, the employment of any
individual.  Nothing herein contained, or
any action hereunder, shall be deemed to give any Eligible Employee the right
to be retained in the employ of an Employer or to interfere with the right of
any Employer to terminate any Eligible Employee at any time.

 

9.2.                              Alienation or Assignment of Benefits.  Other than by will,
the laws of descent and distribution, or by appointing a Beneficiary, a
Participant’s rights and interest under the Plan shall not be assigned or
transferred except as otherwise permitted by the Committee, and a Participant’s
rights to benefit payments under the Plan shall not be subject to alienation,
pledge or garnishment by or on behalf of creditors (including heirs,
beneficiaries, or dependents) of the Participant or of a Beneficiary.  The Company may assign its rights and
obligations under the Plan to a Person or entity, which is an Affiliate or a
successor in interest to substantially all of the business operations of the
Company.

 

9.3.                              Severability.  In the event that any provision of the Plan
shall be declared illegal or invalid for any reason, said illegality or
invalidity shall not affect the remaining provisions of the Plan but shall be
fully severable, and the Plan shall be construed and enforced as if said
illegal or invalid provision had never been inserted herein.

 

9.4.                              Right to Withhold.  To the extent required by applicable law in
effect at the time a distribution is made from the Plan, the Company, any
Employer or their respective agents shall have the right to withhold or deduct
from any distributions or payments hereunder any taxes required to be withheld
by federal, state or local governments prior to making any such distributions
or payments.

 

9.5.                              Governing Law. The
validity, construction, and effect of the Plan and any rules and regulations
relating to the Plan shall be determined in accordance with the laws of the
State of Michigan, without giving effect to principles of conflicts of laws to
the extent not pre-empted by federal law.

 

9.6.                              Effective Date. The
effective date of the Plan is June 15, 2005.

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