Document:

EX-10.95

Exhibit 10.95

RETAIL VENTURES, INC.

SECOND AMENDED AND RESTATED

2000 STOCK INCENTIVE PLAN

1. BACKGROUND, PURPOSE AND DURATION

     1.1 Effective Date. Effective December 4, 2000, the Company adopted the Amended and Restated
2000 Stock Incentive Plan. This second amended and restated version of the Plan is effective as of
the 1st day of January, 2008.

     1.2 Purpose of the Plan. The Plan is intended to further the growth and profitability of the
Company by providing increased incentive to and encourage Share ownership on the part of (a)
Employees of the Company and its Related Companies, (b) Consultants who provide significant
services to the Company or a Related Company, and (c) Directors of the Company who are not
employees of the Company or a Related Company. All management and key Employees, Consultants and
Directors of the Company or a Related Company are eligible to receive Awards under the Plan.

2. DEFINITIONS

     The following words and phrases shall have the following meanings unless a different meaning
is plainly required by the context.

     2.1 “1934 Act” means the Securities Exchange Act of 1934, as amended. Reference to a specific
section of the 1934 Act or regulation thereunder shall include such section or regulation, any
valid regulation promulgated under such section, and any comparable provision of any future
legislation or regulation amending, supplementing or superseding such section or regulation.

     2.2 “Affiliate” means any corporation or any other entity (including, but not limited to,
partnerships, limited liability corporations and joint ventures) controlling, controlled by, or
under common control with the Company.

     2.3 “Award” means, individually or collectively, a grant under the Plan of Nonqualified Stock
Options, Incentive Stock Options, SARs, Restricted Stock, Performance Units, or Performance Shares.

     2.4 “Award Agreement” means the written agreement setting forth the terms and provisions
applicable to each Award granted under the Plan.

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

     2.6 “Change of Control” will be deemed to have occurred if and when (a) an individual,
partnership, corporation, trust or other entity (“Person”) acquires or combines with the Company,
or 50 percent or more of the Company’s assets or earning power, in one or more transactions, and
after such acquisition or combination, less than a majority of the outstanding voting shares of the
Person surviving such transaction (or the ultimate parent of the surviving Person) are owned by the
owners of the voting shares of the Company outstanding immediately

 

 

prior to such acquisition or combination; or (b) during any period of two consecutive years
during the term of this Plan, individuals who at the beginning of such period are members of the
Board (“Original Board Members”) cease for any reason to constitute at least a majority of the
Board, unless the election of each Board member who was not an original Board Member has been
approved in advance by Board members representing at least two-thirds of the Board members then in
office who were Original Board Members or elected by them.

     2.7 “Code” means the Internal Revenue Code of 1986, as amended. Reference to a specific
section of the Code or regulation thereunder shall include such section or regulation, any valid
regulation promulgated under such section, and any comparable provision of any future legislation
or regulation amending, supplementing or superseding such section or regulation.

     2.8 “Committee” means the committee appointed by the Board (pursuant to Section 3.1) to
administer the Plan.

     2.9 “Company” means Retail Ventures, Inc., an Ohio corporation, or any successor thereto.
Where the context requires, as determined by the Committee in its sole and absolute discretion, a
reference to the Company may include a Related Company.

     2.10 “Consultant” means any consultant, independent contractor, or other person who provides
significant services to the Company or a Related Company, but who is neither an Employee nor a
Director.

     2.11 “Covered Officers” means those Participants who the Committee designates, for each
Performance Period, in order to maintain qualified performance-based compensation within the
meaning of Code Section 162(m).

     2.12 “Director” means any individual who is a member of the Board.

     2.13 “Disability” means a permanent and total disability within the meaning of Code Section
22(e)(3), provided that in the case of Awards other than Incentive Stock Options, the Committee,
its discretion may determine whether a permanent and total disability exists in accordance with
uniform and non-discriminatory standards adopted by the Committee from time to time.

     2.14 “Employee” means any management or key employee of the Company or a Related Company,
whether such employee is so employed at the time the Plan is adopted or becomes so employed
subsequent to the adoption of the Plan.

     2.15 “Exercise Price” means: (a) with respect to an Option, the price at which a Share may be
purchased by a Participant pursuant to the exercise of such Option; (b) with respect to a Tandem
SAR, the Exercise Price of the underlying Option; and (c) with respect to a Freestanding SAR, the
Fair Market Value of a Share underlying the Freestanding SAR on the Grant Date.

     2.16 “Extraordinary Events” shall mean (a) asset write-downs, (b) litigation or claim
judgments or settlements, (c) the effect of changes in tax law, accounting principles or other such
laws or provisions affecting reported results, (d) accruals for reorganization and restructuring
programs, (e) capital gains and losses, (f) special charges in connection with mergers and

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acquisitions, and (g) 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 operation appearing or incorporated by reference in the Company’s Annual
Report on Form 10-K filed with the Securities and Exchange Commission for the applicable year.

     2.17 “Fair Market Value” means, as of any relevant date, the arithmetic mean of the high and
low sales price per Share reported on the New York Stock Exchange, or such other established
securities market on which the Shares may be traded, on the specified date, or if there be no
reported sale on that date, the next preceding date on which the Shares were traded. In the event
that the Shares are not traded on an established securities market, the fair market value of the
Shares, as of any relevant date, shall be determined by the Committee through the reasonable
application of a reasonable valuation method, taking into account all information material to the
value of the Company, that satisfies the requirements of Code Section 409A.

     2.18 “Fiscal Year” means the fiscal year of the Company.

     2.19 “Freestanding SAR” means a SAR that is granted independently of any Option.

     2.20 “Grant Date” means, with respect to an Award, the date that the Award was granted.

     2.21 “Incentive Stock Option” means an Option to purchase Shares which is designated as an
Incentive Stock Option and is intended to meet the requirements of Code Section 422.

     2.22 “Nonqualified Stock Option” means an Option to purchase Shares which is not intended to
be an Incentive Stock Option.

     2.23 “Option” means an Incentive Stock Option or a Nonqualified Stock Option.

     2.24 “Participant” means an Employee, Consultant, or Nonemployee Director who has an
outstanding Award.

     2.25 “Performance Goal” shall mean any one or more of the following performance criteria:

          (a) Income (loss) per common share from continuing operations as disclosed in the Company’s
annual report to shareholders for a particular Fiscal Year;

          (b) Income (loss) per common share disclosed in the Company’s annual report to shareholders
for a particular Fiscal Year;

          (c) Income (loss) per common share or income (loss) per common share from continuing
operations excluding (i) extraordinary charge(s); and/or (ii) any accruals for restructuring
programs, merger integration costs, or merger transaction costs; and/or (iii) other unusual or
infrequent items (whether gains or losses) as defined by generally accepted accounting principles
(GAAP) which are disclosed as a separate component of income or loss on the face of the income
statement or as may be disclosed in the notes to the financial statements (hereinafter “EPS”);

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          (d) Ratio of operating profit, or other objective and specific income (loss) category results
to (ii) average common shares outstanding (adjustments to W in this paragraph may be made at the
time of the goal/target establishment by the Committee in its discretion);

          (e) Any of items (a), (b), (c) or (d) on a diluted basis as described in Statement of
Financial Accounting Standards No. 128 including official interpretations or amendments thereof
which may be issued from time to time as long as such interpretations or amendments are utilized on
the face of the income statement or in the notes to the financial statements disclosed in the
Company’s annual report to shareholders;

          (f) Share price;

          (g) Total shareholder return expressed on a dollar or percentage basis as is customarily
disclosed in the proxy statement accompanying the notice of annual meetings of shareholders;

          (h) Income (loss) (i) from continuing operations before extraordinary charge(s), or (ii)
before extraordinary charge(s), or (iii) net, as the case may be, adjusted to remove the effect of
any accruals for restructuring programs or other unusual or infrequent items as defined by
generally accepted accounting principles (GAAP) disclosed as a separate component of income on the
face of the income statement or in the notes to the financial statements;

          (i) Net income;

          (j) Income (loss) before income taxes;

          (k) Percentage increase in comparable store sales as disclosed in the Company’s annual report
on Form 10-K;

          (l) Any of items (a) through (k) above with respect to any Related Company, Affiliate,
division, business unit or business group of the Company whether or not such information is
included in the Company’s annual report to shareholders, proxy statement or notice of annual
meeting of shareholders;

          (m) Any of items (a) though (k) above with respect to a Performance Period whether or not such
information is included in the Company’s annual report to shareholders, proxy statement or notice
of annual meetings of shareholders;

          (n) Total Shareholder Return Ranking Position meaning the relative placement of the Company’s
Total Shareholder Return compared to those publicly held companies in the Company’s peer group as
established by the Committee prior to the beginning of a vesting period or such later date as
permitted under the Code. The peer group shall be comprised of not less than six (6) companies,
including the Company; or

          (o) Any other objective criteria established by the Committee and approved by the shareholders
of the Company prior to payment of any Award based on the criteria.

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     With respect to items (a), (b), (c) and (d) above, other terminology may be used for “income
(loss) per common share” (such as “Basic EPS”, “earnings per common share”, “diluted EPS”, or
“earnings per common share-assuming dilution”) as contemplated by Statement of Financial Accounting
Standards No. 128.

     2.26 “Performance Period” means the Fiscal Year except in the following cases: (a) the
Employee’s service period within a Fiscal Year in the case of a new hire or promoted Employee; (b)
a period of service determined at the discretion of the Committee prior to the expiration of more
than twenty-five percent (25%) of the period; or (c) such period as determined by the Committee
with respects to grants of Performance Units or Performance Shares pursuant to Section 8.
Notwithstanding any provision contained herein, Performance Periods of Awards granted to Section 16
Persons shall exceed six (6) months in length (or such shorter period as may be permissible while
maintaining compliance with Rule 16b-3).

     2.27 “Performance Share” means a Performance Share granted to a Participant pursuant to
Section 8.

     2.28 “Performance Unit” means a Performance Unit granted to a Participant pursuant to Section
8.

     2.29 “Period of Restriction” means the period during which shares of Restricted Stock are
subject to forfeiture and/or restrictions on transferability; provided, however, that the Period of
Restriction on Shares granted to a Section 16 Person may not lapse until at least six (6) months
after the Grant Date.

     2.30 “Plan” means this plan, the Retail Ventures, Inc. Second Amended and Restated 2000 Stock
Incentive Plan, as set forth in this instrument and as hereafter amended from time to time.

     2.31 “Related Company” means, with respect to: (a) an Award of Incentive Stock Options, a
subsidiary of the Company within the meaning of Code Section 424(f), which includes any entity in
an unbroken chain of entities beginning with the Company if, at the time of the grant of an Award,
each of the entities other than the last entity in the chain then owns fifty percent (50%) or more
of the total combined voting power in one of the other entities in the chain; (b) with respect to
an Award of Nonqualified Stock Options or Stock Appreciation Rights, any entity that, along with
the Company, would be considered an “eligible issuer of service recipient stock” within the meaning
of Treasury Regulation § 1.409A-1(b)(5); and (c) with respect to any other Award, an Affiliate.

     2.32 “Restricted Stock” means an Award granted to a Participant pursuant to Section 7.

     2.33 “Retirement” means, in the case of an Employee, a Termination of Service by reason of the
Employee’s retirement at or after his or her having satisfied the requirements for retirement under
the applicable Company or Related Company qualified retirement plan. With respect to a Consultant,
no Termination of Service shall be deemed to be on account of “Retirement.” With respect to a
Nonemployee Director, “Retirement” means Termination of Service on the Board with the consent of
the remaining Directors.

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     2.34 “Rule 16b-3” means Rule 16b-3 promulgated under the 1934 Act, as amended, and any future
regulation amending, supplementing or superseding such regulation.

     2.35 “Section 16 Person” means a person who, with respect to the Shares, is subject to section
16 of the 1934 Act.

     2.36 “Shares” means the shares of the Company’s common shares, without par value.

     2.37 “Stock Appreciation Right” or “SAR” means an Award, granted alone or in connection with a
related Option, that pursuant to Section 6, is designated as a SAR.

     2.38 “Tandem SAR” means a SAR that is granted in connection with a related Option, the
exercise of which shall require forfeiture of the right to purchase an equal number of Shares under
the related Option (and when a Share is purchased under the Option, the SAR shall be canceled to
the same extent).

     2.39 “Termination of Service” means (a) in the case of an Employee, a cessation of the
employee-employer relationship between an Employee and the Company or a Related Company for any
reason, including, but not by way of limitation, a termination by resignation, discharge, death,
Disability, Retirement, or termination of the termination of Related Company status, including the
disaffiliation of an Affiliate, but excluding any such termination where there is a simultaneous
reemployment by the Company or a Related Company; (b) in the case of a Consultant, a cessation of
the service relationship between a Consultant and the Company or a Related Company for any reason,
including, but not by way of limitation, a termination by resignation, discharge, death,
Disability, or the termination of Related Company status, including the disaffiliation of an
Affiliate, but excluding any such termination where there is a simultaneous re-engagement of the
consultant by the Company or a Related Company; and (c) in the case of a, Nonemployee Director, a
cessation of the Nonemployee Director’s service on the Board for any reason.

3. ADMINISTRATION

     3.1 The Committee. The Plan shall be administered by the Committee. The Committee shall
consist of not less than two (2) Directors. The members of the Committee shall be appointed from
time to time by, and shall serve at the pleasure of, the Board. The Committee shall be comprised
solely of Directors who both are (a) “non-employee directors” under Rule 16b-3, and (b) “outside
directors” under Code Section 162(m).

     3.2 Authority of the Committee. It shall be the duty of the Committee to administer the Plan
in accordance with the Plan’s provisions. The Committee shall have all powers and discretion
necessary or appropriate to administer the Plan and to control its operation, including, but not
limited to, the power to (a) determine which Employees and Consultants shall be granted Awards, (b)
prescribe the terms and conditions of the Awards (other than the Options granted to Nonemployee
Directors pursuant to Section 9), (c) interpret the Plan and the Awards, (d) adopt such procedures
and subplans as are necessary or appropriate to permit participation in the Plan by Employees,
Consultants and Directors who are foreign nationals or employed outside of the United States, (e)
adopt rules for the administration, interpretation and application of the Plan as are consistent
therewith, and (f) interpret, amend or revoke any such rules.

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     3.3 Delegation by the Committee. The Committee, in its sole discretion and on such terms and
conditions as it may provide, may delegate all or any part of its authority and powers under the
Plan to one or more directors or officers of the Company; provided, however, that the Committee may
not delegate its authority and powers (a) with respect to Section 16 Persons, or (b) in any way
which would jeopardize the Plan’s qualification under Code Section 162(m) or Rule 16b-3.

     3.4 Nonemployee Directors. Notwithstanding any contrary provision of this Section 3, the
Board shall administer Section 9 of the Plan, and the Committee shall exercise no discretion with
respect to Section 9. In the Board’s administration of Section 9 and the Options and any Shares
granted to Nonemployee Directors, the Board shall have all of the authority and discretion
otherwise granted to the Committee with respect to the administration of the Plan.

     3.5 Decisions Binding. All determinations and decisions made by the Committee, the Board, and
any delegate of the Committee pursuant to the provisions of the Plan shall be final, conclusive,
and binding on all Persons, and shall be given the maximum deference permitted by law.

4. SHARES SUBJECT TO THE PLAN

     4.1 Number of Shares. Subject to adjustment as provided in Section 4.3, the total number of
Shares available for grant under the Plan shall not exceed thirteen million (13,000,000). Shares
granted under the Plan may be either authorized but unissued Shares or treasury Shares.

     4.2 Lapsed Awards. If an Award terminates, expires, or lapses for any reason, any Shares
subject to such Award again shall be available to be the subject of an Award.

     4.3 Adjustments in Awards and Authorized Shares. In the event of any merger, reorganization,
consolidation, recapitalization, separation, liquidation, stock dividend, split-up, Share
combination, or other change in the corporate structure of the Company affecting the Shares, the
Committee shall adjust the number and class of Shares which may be delivered under the Plan, the
number, class, and price of shares subject to outstanding Awards, and the numerical limit of
Section 10.5 in such manner as the Committee (in its sole discretion) shall determine to be
appropriate to prevent the dilution or diminution of such Awards. In the case of Options granted
to Nonemployee Directors pursuant to Section 9, no adjustments by stock dividends or split up will
be made to the number of Shares in original grants (i.e., 1,000 per quarter), but the foregoing
adjustments to outstanding Options may be made by the Board in its sole discretion to prevent the
dilution or diminution of such Awards. Notwithstanding the foregoing, (a) an adjustment pursuant
to this Section 4.3 shall only be permissible to the extent such adjustment is in compliance with
the requirements of Code Section 409A, to the extent applicable, and (b) the number of Shares
subject to any Award always shall be a whole number.

5. STOCK OPTIONS

     5.1 Grant of Options. Subject to the terms and provisions of the Plan, Options may be granted
to Employees and Consultants at any time and from time to time as determined by the Committee in
its sole discretion. The Committee, in its sole discretion, shall determine the

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number of Shares subject to each Option. The Committee may grant Incentive Stock Options,
Nonqualified Stock Options, or a combination thereof.

     5.2 Award Agreement. Each Option shall be evidenced by an Award Agreement that shall specify
the Exercise Price, the expiration date of the Option, the number of Shares to which the Option
pertains, any conditions to exercise of the Option, and such other terms and conditions as the
Committee, in its discretion, shall determine. The Award Agreement shall specify whether the
Option is intended to be an Incentive Stock Option or a Nonqualified Stock Option.

     5.3 Exercise Price. Subject to the provisions of this Section 5.3, the Exercise Price for
each Option shall be determined by the Committee in its sole discretion through the application of
the following rules:

          5.3.1 Nonqualified Stock Options. In the case of a Nonqualified Stock Option, the Exercise
Price shall be not less than one hundred percent (100%) of the Fair Market Value of a Share on the
Grant Date.

          5.3.2 Incentive Stock Options. In the case of an Incentive Stock Option, the Exercise Price
shall be not less than one hundred percent (100%) of the Fair Market Value of a Share on the Grant
Date; provided, however, that if on the Grant Date, the Employee (together with persons whose stock
ownership is attributed to the Employee pursuant to Code Section 424(d)) owns stock possessing more
than ten percent (10%) of the total combined voting power of all classes of stock of the Company or
any of its Subsidiaries, the Exercise Price shall be not less than one hundred and ten percent
(110%) of the Fair Market Value of a Share on the Grant Date.

          5.3.3 Substitute Options. Notwithstanding the provisions of Sections 5.3.1 and 5.3.2, in the
event that the Company consummates a transaction described in Code Section 424(a) (e.g., the
acquisition of property or stock from an unrelated corporation), persons who become Employees or
Consultants on account of such transaction may be granted Options in substitution for options
granted by their former employer. If such substitute Options are granted, the Committee, in its
sole discretion, shall determine the Exercise Price of such substitute Options in accordance with
Code Sections 409A and 424.

     5.4 Expiration of Options.

          5.4.1 Expiration Dates. Each Option shall terminate no later than the first to occur of the
following events:

               (a) The date for termination of the Option set forth in the written Award Agreement; or

               (b) The expiration of ten (10) years from the Grant Date (except as provided in Section 5.8.4
regarding Incentive Stock Options; or

               (c) Immediately upon the date and time of the Participant’s Termination of Service for a
reason other than the Participant’s death, Disability or Retirement,

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unless the Committee in its sole discretion elects to extend the exercisability of an Option
to not more than three (3) months from Termination of Service; or

               (d) The expiration of one (1) year from the date of the Participant’s Termination of Service
by reason of death, Disability or Retirement (except as provided in Section 5.8.2 regarding
Incentive Stock Options).

          5.4.2 Committee Discretion. Subject to the limits of Sections 5.4.1, the Committee, in its
sole discretion, (a) shall provide in each Award Agreement when each Option expires and becomes
unexercisable, and (b) may, after an Option is granted, extend the maximum term of the Option
(subject to Section 5.8.4 regarding Incentive Stock Options). Notwithstanding the foregoing, the
term of a Nonqualified Stock Option may only be extended at a time when the Exercise Price of the
Option equals or exceeds the Fair Market Value of the underlying Shares.

     5.5 Exercisability of Options. Options granted under the Plan shall be exercisable at such
times and be subject to such restrictions and conditions as the Committee shall determine in its
sole discretion. After an Option is granted, the Committee, in its sole discretion, may accelerate
the exercisability of the Option. However, in no event may any Option granted to a Section 16
Person be exercisable until at least six (6) months following the Grant Date.

     5.6 Payment. Options shall be exercised by the Participant’s delivery of a written notice of
exercise to the Secretary of the Company (or the Company’s designee), setting forth the number of
Shares with respect to which the Option is to be exercised, accompanied by full payment for the
Shares.

     Upon the exercise of any Option, the Exercise Price shall be payable to the Company in full in
cash or its equivalent. The Committee, in its sole discretion, also may permit exercise (a) by
tendering previously acquired Shares having an aggregate Fair Market Value at the time of exercise
equal to the total Exercise Price, or (b) by any other means which the Committee, in its sole
discretion, determines to both provide legal consideration for the Shares, and to be consistent
with the purposes of the Plan.

     As soon as practicable after receipt of a written notification of exercise and full payment
for the Shares purchased, the Company shall deliver to the Participant (or the Participant’s
designated broker), Share certificates (which may be in book entry form) representing such Shares.

     5.7 Restrictions on Share Transferability. The Committee may impose such restrictions on any
Shares acquired pursuant to the exercise of an Option as it may deem advisable, including, but not
limited to, restrictions related to applicable Federal securities laws, the requirements of any
national securities exchange or system upon which Shares are then listed or traded, or any blue sky
or state securities laws.

     5.8 Certain Additional Provisions for Incentive Stock Options. Notwithstanding anything to
the contrary contained in this Section 5, the following provisions shall apply to any Incentive
Stock Option granted pursuant to the Plan.

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          5.8.1 Exercisability. The aggregate Fair Market Value (determined on the Grant Date(s)) of
the Shares with respect to which Incentive Stock Options are exercisable for the first time by any
Employee during any calendar year (under all plans of the Company and its Subsidiaries) shall not
exceed $100,000.

          5.8.2 Termination of Service. No Incentive Stock Option may be exercised more than three (3)
months after the Participant’s Termination of Service for any reason other than Disability or
death. In the event of a Participant’s Termination of Service due to the Participant’s Disability
or death, the Participant, the Participant’s legal guardian, legal representative or estate shall
have the right to exercise the Incentive Stock Option for a period of one year following the date
of such Termination of Service (but in no event beyond the maximum term of the Incentive Stock
Option specified in Section 5.8.4).

          5.8.3 Company and Subsidiaries Only. Incentive Stock Options may be granted only to persons
who are Employees on the Grant Date.

          5.8.4 Expiration. No Incentive Stock Option may be exercised after the expiration of ten (10)
years from the Grant Date; provided, however, that if the Option is granted to an Employee who,
together with persons whose stock ownership is attributed to the Employee pursuant to Code Section
424(d), owns stock possessing more than ten percent (10%) of the total combined voting power of all
classes of the stock of the Company or any of its Subsidiaries, the Option may not be exercised
after the expiration of five (5) years from the Grant Date.

     5.9 Grant of Reload Options. The Committee may provide in an Award Agreement that a
Participant who exercises all or part of an Option by payment of the Exercise Price with already
owned Shares, shall be granted an additional Option (a “Reload Option”) for a number of shares
equal to the number of Shares tendered to exercise the previously granted Option plus, if the
Committee so determines, any shares withheld or delivered in satisfaction of any tax withholding
requirements. As determined by the Committee, each Reload Option shall: (a) have a Grant Date
which is the date as of which the previously granted Option is exercised, and (b) be exercisable on
the same terms and conditions as the previously granted Option, except that the Exercise Price
shall be determined as of the Grant Date.

     5.10 Acceleration on Change of Control. Unless provided otherwise in the Award Agreement, if
a Change of Control occurs, all outstanding Options granted under the Plan will become immediately
exercisable to the extent of one hundred percent (100%) of the Shares subject thereto
notwithstanding any contrary exercise or vesting periods specified in this Plan.

6. STOCK APPRECIATION RIGHTS.

     6.1 Grant of SARs. Subject to the terms and conditions of the Plan, a SAR may be granted to
Employees and Consultants at any time and from time to time as shall be determined by the
Committee, in its sole discretion. The Committee may grant Freestanding SARs, Tandem SARs, or any
combination thereof. The Committee shall have complete discretion to determine the number of SARs
granted to any Participant.

          6.1.1 Exercise Price and Other Terms. The Committee, subject to the provisions of the Plan,
shall have complete discretion to determine the terms and conditions of SARs

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granted under the Plan. However, the Exercise Price of a Freestanding SAR shall be not less
than one hundred percent (100%) of the Fair Market Value of a Share on the Grant Date and the
Exercise Price of Tandem SAR shall equal the Exercise Price of the related Option. In no event
shall a SAR granted to a Section 16 Person become exercisable until at least six (6) months after
the Grant Date (or such shorter period as may be permissible while maintaining compliance with Rule
16b-3).

     6.2 Exercise of Tandem SARs. Tandem SARs may be exercised for all or part of the Shares
subject to the related Option upon the surrender of the right to exercise the equivalent portion of
the related Option. A Tandem SAR may be exercised only with respect to the Shares for which its
related Option is then exercisable. With respect to a Tandem SAR granted in connection with an
Option: (a) the Tandem SAR shall expire no later than the expiration of the underlying Option; (b)
payment upon exercise of a Tandem SAR shall not be greater than one hundred percent (100%) of the
excess of the Fair Market Value of a Share on the date of exercise over the Exercise Price of the
Option with respect to which such Tandem SAR was granted; and (c) the Tandem SAR shall be
exercisable only when the Fair Market Value of the Shares subject to the Option exceeds the
Exercise Price of the Option.

     6.3 Exercise of Freestanding SARs. Freestanding SARs shall be exercisable on such terms and
conditions as the Committee, in its sole discretion, shall determine. Provided, however, no
Freestanding SAR granted to a Section 16 Person shall be exercisable until at least six (6) months
after the Grant Date (or such shorter period as may be permissible while maintaining compliance
with Rule 16b-3). Provided, further, that payment upon exercise of the Freestanding SAR shall not
be greater than the excess of the Fair Market Value of a Share on the date of exercise over the
Exercise Price of the Freestanding SAR.

     6.4 SAR Agreement. Each SAR grant shall be evidenced by an Award Agreement that shall specify
the Exercise Price, the term of the SAR, the conditions of exercise, and such other terms and
conditions as the Committee, in its sole discretion, shall determine.

     6.5 Expiration of SARs. A SAR granted under the Plan shall expire upon the date determined by
the Committee, in its sole discretion, and set forth in the Award Agreement. Notwithstanding the
foregoing, the rules of Section 5.4 also shall apply to SARs.

     6.6 Payment upon Exercise of SAR. Upon the exercise of a SAR, a Participant shall be entitled
to receive payment within sixty (60) days from the Company in an amount not to exceed:

          (a) The difference between: (1) the Fair Market Value of a Share on the date of exercise and
(2) the Exercise Price of the SAR; multiplied by

          (b) The number of Shares with respect to which the SAR is exercised.

     At the discretion of the Committee, payment upon exercise of a SAR may be made in cash, Shares
or a combination thereof.

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7. RESTRICTED STOCK

     7.1 Grant of Restricted Stock. Subject to the terms and provisions of the Plan, the
Committee, at any time and from time to time, may grant Shares of Restricted Stock to Employees and
Consultants in such amounts as the Committee, in its sole discretion, shall determine. The
Committee, in its sole discretion, shall determine the number of Shares to be granted to each
Participant.

     7.2 Restricted Stock Agreement. Each Award of Restricted Stock shall be evidenced by an Award
Agreement that shall specify the Period of Restriction, the number of Shares granted, any price to
be paid for the Shares, and such other terms and conditions as the Committee, in its sole
discretion, shall determine. Unless the Committee determines otherwise, Shares of Restricted Stock
shall be held by the Company as escrow agent until the restrictions on such Shares have lapsed.

     7.3 Transferability. Shares of Restricted stock may not be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated until the end of the applicable Period of
Restriction. In no event may the restrictions on Restricted Stock granted to a Section 16 Person
lapse prior to six (6) months following the Grant Date.

     7.4 Other Restrictions. The Committee, in its sole discretion, may impose such other
restrictions on Shares of Restricted Stock as it may deem advisable or appropriate, in accordance
with this Section 7.4. For example, the Committee may set restrictions based upon the achievement
of specific performance objectives (Company-wide, divisional, or individual), applicable Federal or
state securities laws, or any other basis determined by the Committee in its discretion. The
Committee, in its discretion, may legend the certificates representing Restricted Stock to give
appropriate notice of the restrictions applicable to such Shares.

     7.5 Removal of Restrictions. Shares of Restricted Stock covered by each Restricted Stock
grant made under the Plan shall be released from escrow as soon as practicable after the last day
of the Period of Restriction. The Committee, in its discretion, may accelerate the time at which
any restrictions shall lapse, and remove any restrictions; provided, however, that the Period of
Restriction on Shares granted to a Section 16 Person may not lapse until at least six (6) months
after the Grant Date. After the restrictions have lapsed, the Participant shall be entitled to
have any legend or legends under Section 7.4 removed from his or her Share certificate, and the
Shares shall be freely transferable by the Participant.

     7.6 Voting Rights. During the Period of Restriction, Participants holding Shares of
Restricted Stock granted hereunder may exercise full voting rights with respect to those Shares,
unless otherwise provided in the Award Agreement.

     7.7 Dividends and Other Distributions. During the Period of Restriction, Participants holding
Shares of Restricted Stock shall be entitled to receive all dividends and other distributions paid
with respect to such Shares unless otherwise provided in the Award Agreement. Any dividends or
distributions payable to a Participant in accordance with this Section 7.7 shall be paid on the
same date as such dividends or distributions are paid to other holders of Shares. If any such
dividends or distributions are paid in Shares, the Shares shall be

12

 

subject to the same restrictions on transferability and forfeitability as the Shares of
Restricted Stock with respect to which they were paid. With respect to Restricted Stock granted to
a Section 16 Person, any dividend or distribution that constitutes a “derivative security” or an
“equity security” under Section 16 of the 1934 Act shall be subject to a Period of Restriction
equal to the longer of: (a) the remaining Period of Restriction on the Shares of Restricted Stock
with respect to which the dividend or distribution is paid; or (b) six (6) months.

     7.8 Return of Restricted Stock to Company. On the date set forth in the Award Agreement, the
Restricted Stock for which restrictions have not lapsed shall revert to the Company and again shall
become available for grant under the Plan.

8. PERFORMANCE UNITS AND PERFORMANCE SHARES

     8.1 Grant of Performance Units/Shares. Performance Units and Performance Shares may be
granted to Employees and Consultants at any time and from time to time, as shall be determined by
the Committee, in its sole discretion. The Committee shall have complete discretion in determining
the number of Performance Units and Performance Shares granted to any Participant.

     8.2 Initial Value. Each Performance Unit shall have an initial value that is established by
the Committee on or before the Grant Date. Each Performance Share shall have an initial value
equal to the Fair Market Value of a Share on the Grant Date.

     8.3 Performance Objectives and Other Terms. The Committee shall set performance objectives in
its discretion which, depending on the extent to which they are met, will determine the number or
value of Performance Units or Shares that will be paid out to the Participants. The Committee may
set performance objectives based upon the achievement of Company-wide, divisional, or individual
goals, or any other basis determined by the Committee in its discretion. The time period during
which the performance objectives must be met shall be called the “Performance Period”. Performance
Periods of Awards granted to Section 16 Persons shall exceed six (6) months in length (or such
shorter period as may be permissible while maintaining compliance with Rule 16b-3). Each Award of
Performance Units/Shares shall be evidenced by an Award Agreement that shall specify the
Performance Period, and ouch other terms and conditions as the Committee, in its sole discretion,
shall determine.

     8.4 Earning of Performance Units and Performance Shares. After the applicable Performance
Period has ended, the Participant shall be entitled to receive a payout of the number of
Performance Units or Shares earned during the Performance Period, depending upon the extent to
which the applicable performance objectives have been achieved. After the grant of a Performance
Unit or Share, the Committee, in its sole discretion, may reduce or waive any performance
objectives for Award; provided that Performance Periods of Awards granted to Section 16 Persons
shall not be less than six (6) months (or such shorter period as may be permissible while
maintaining compliance with Rule 16b-3).

     8.5 Form and Timing of Payment. Payment of earned Performance Units or Performance Shares
shall be made as soon as practicable after the expiration of the applicable Performance Period as
set forth in the Award Agreement related to such Performance Units or

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Performance Shares. The Committee, in its sole discretion, may pay earned Performance Units
or Performance shares in cash, Shares or a combination thereof.

     8.6 Cancellation. On the date set forth in the Award Agreement, all unearned or unvested
Performance Units or Performance Shares shall be forfeited to the Company, and again shall be
available for grant under the Plan.

9. NONEMPLOYEE DIRECTORS

     9.1 Granting of Options. If any class of equity securities of the Company is registered under
Section 12 of the 1934 Act, on the first trading day of each fiscal quarter of the Company, each
Nonemployee Director will automatically receive under the Plan a Nonqualified Stock Option to
purchase 2,500 Shares. Future automatic grants will cease and be suspended at any time that there
are not sufficient Shares available under the Plan.

     9.2 Terms of Options.

          9.2.1 Option Agreement. Each Option granted pursuant to this Section 9 shall be evidenced by
a written stock option agreement which shall be executed by the Participant and the Company.

          9.2.2 Exercise Price. The Exercise Price for the Shares subject to each Option granted
pursuant to this Section 9 shall be one hundred percent (100%) of the Fair Market Value of such
Shares on the Grant Date.

          9.2.3 Exercisability. Each Option granted pursuant to this Section 9 shall become exercisable
in full one year after the date the Option is granted. If a Nonemployee Director incurs a
Termination of Service for a reason other than Retirement, death or Disability, his or her Options
which are not exercisable on the date of such Termination shall never become exercisable. If the
Termination of service is on account of Retirement, death or Disability, the Option shall become
exercisable in full on the date of the Termination of Service.

          9.2.4 Expiration of Options. Each Option shall terminate upon the first to occur of the
following events;

               (a) The expiration of ten (10) years from the Grant Date; or

               (b) The expiration of three (3) months from the date of the Participant’s Termination of
Service for a reason other than death, Disability or Retirement; or

               (c) The expiration of one (1) year from the date of the Participant’s Termination of Service
by reason of Disability or Retirement.

          9.2.5 Death of Director. Notwithstanding Section 9.2.4, if a Director dies prior to the
expiration of his or her Options in accordance with Section 9.2.4, his or her Options shall
terminate one (1) year after the date of his or her death.

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          9.2.6 Special Rule for Retirement. Notwithstanding the provisions of Section 9.2.4, if the
exercisability of an Option is accelerated under Section 9.2.3 on account of the Participant’s
Retirement, such Option shall terminate upon the first to occur of: (a) The expiration of ten (10)
years from the date the Option was granted; or (b) the expiration of one year from the date of the
Participant’s death.

          9.2.7 Not Incentive Stock Options. Options granted pursuant to this Section 9 shall not be
designated as Incentive Stock Options.

          9.2.8 Other Terms. All provisions of the Plan not inconsistent with this Section 9,
including, but not limited to, Section 5.10, shall apply to Options granted to Nonemployee
Directors; provided, however, that Section 5.2 (relating to the Committee’s discretion to set the
terms and conditions of Options) shall be inapplicable with respect to Nonemployee Directors.

     9.3 Elections by Nonemployee Directors. Pursuant to such procedures as the Board (in its
discretion) may adopt from time to time, each Nonemployee Director may elect to forego receipt of
all or a portion of committee fees and meeting fees otherwise due to the Nonemployee Director in
exchange for Shares. The number of Shares received by any Nonemployee Director shall equal the
amount of foregone compensation divided by the Fair Market Value of a Share on the date that the
compensation otherwise would have been paid to the Nonemployee Director, rounded up to the nearest
whole number of Shares. The procedures adopted by the Board for elections under this Section 9.3
shall be designed to ensure that any such election by a Nonemployee Director will not disqualify
him or her as a “non-employee director” under Rule 16b-3.

10. SECTION 162(m) DEDUCTION QUALIFICATION.

     Except as otherwise provided in Section 10.5, the provisions of this Section 10 shall apply
only to Awards of Covered officers.

     10.1 Awards for Covered Officers. Any other provision of the Plan notwithstanding, all Awards
to Covered Officers shall be made in a manner that allows for the full deductibility of the Award
by the Company or a Related Company under Code Section 162(m). All Awards for Covered Officers
shall comply with the provisions of this Section 10.

     10.2 Designation of Covered Officers. For each Performance Period, the Committee will
designate which Participants are Covered Officers prior to the completion of twenty-five percent
(25%) of the Performance Period (or such earlier or later date as is permitted or required by Code
Section 162(m)).

     10.3 Establishment of Performance Goals and Awards for Covered Officers. Prior to the
completion of twenty-five percent (25%) of a Performance Period (or such earlier or later date as
is permitted or required by Code Section 162(m)), the Committee shall in its sole discretion, for
each such Performance Period: (a) determine and establish in writing one or more Performance Goals
applicable to the Performance Period for each Covered Officer; and (b) either (i) assign each
Covered Officer a target Award expressed as a fixed number of Shares or a whole dollar amount or
(ii) establish a payout table or formula for purposes of determining the Award payable to each
Covered Officer. Each payout table or formula: (w) shall be in writing; (x) shall

15

 

be based on a comparison of actual performance to the Performance Goals; (y) may include a
“floor” which is the level of achievement of the Performance Goal in which payout begins; and (z)
shall provide for an actual Award equal to or less than the Covered Officer’s target Award,
depending on the extent to which actual performance approached or reached the Performance Goal.
Such preestablished Performance Goals and Awards must state, in terms of an objective formula or
standard, the method for computing the amount of the Award payable to each Covered Officer if the
Performance Goal is met. A formula or standard is objective if a third party having knowledge of
the relevant performance results could calculate the amount to be paid to the Covered Officer. The
Committee may establish any number of Performance Periods, Performance Goals and Awards for any
Covered Officer running concurrently, in whole or in part, provided, that in so doing the Committee
does not jeopardize the Company’s or a Related Company’s deduction for such Awards under Code
Section 162(m). The Committee may select different Performance Goals and Awards for different
Covered Officers.

     10.4 Certification of Achievement of Performance Goals and Amount of Awards. After the end of
each Performance Period, or such earlier date if the Performance Goals are achieved, the Committee
shall certify in writing, prior to the unconditional payment of any Award, that the Performance
Goals for the Performance Period and all other material terms of the Plan were satisfied and to
what extent they were satisfied. The Committee shall determine the actual Award for each Covered
Officer based on the payout table/formula established in Section 10.3, as the case may be.
Extraordinary Events shall either be excluded or included in determining the extent to which the
corresponding Performance Goal has been achieved, whichever will produce the higher Award,
provided, however, notwithstanding the attainment of specified Performance Goals, the Committee has
the discretion to reduce or eliminate an Award that would otherwise be paid to any Participant,
including any Covered Officer, based on the Committee’s evaluation of Extraordinary Events or other
factors. Without limiting the manner of computing Awards set forth in the preceding sentence, with
respect to Covered Officers, the Committee may not under any circumstances increase the amount of
an Award.

     10.5 Maximum Award. Any other provision of the Plan notwithstanding, the maximum aggregate
Awards payable to any Participant under the Plan for any Performance Period shall not exceed three
million (3,000,000) Shares, which maximum number of Shares shall be adjusted pursuant to Section
4.3.

11. MISCELLANEOUS

     11.1 Forfeiture. Notwithstanding anything in the Plan or in any Award Agreement to the
contrary, in the event of a breach of conduct by a Participant or former Participant (including,
without limitation, any conduct prejudicial to or in conflict with the Company or a Related
Company), or any activity of a Participant or former Participant in competition with any of the
businesses of the Company or a Related Company, the Committee may (a) cancel any outstanding Award
granted to the Participant, in whole or in part, whether or not vested, and/or (b) if such conduct
or activity occurs within one year following the exercise or payment of an Award, require the
former Participant to repay to the Company or a Related Company any gain realized or payment
received upon the exercise or payment of such Award (with such gain or repayment valued as of the
date of exercise or payment). Such cancellation or repayment obligation shall be effective as of
the date specified by the Committee. Any repayment

16

 

obligation may be satisfied in Shares or cash or a combination thereof (based upon the Fair
Market Value of the Shares on the day prior to the date of payment), and the Committee may provide
for an offset to any future payments owed by the Company or Related Company to such individual if
necessary to satisfy the repayment obligation. The determination of whether any Participant or
former Participant has engaged in a breach of conduct or any activity in competition with any of
the businesses of the Company or a Related Company shall be determined by the Committee in good
faith and in its sole discretion.

     11.2 No Effect on Employment or Service. Nothing in the Plan shall interfere with or limit in
any way the right of the Company or a Related Company to terminate any Participant’s employment or
service at any time, with or without cause. For purposes of the Plan, transfer of employment of a
Participant between the Company and any one of its Subsidiaries (or between Subsidiaries) shall not
be deemed a Termination of Service. Unless there is a written agreement between the Employee and
the Company or a Related Company to the contrary, employment of an Employee with the Company and
its Subsidiaries is on an at-will basis only.

     11.3 Participation. No Employee or Consultant shall have the right to be selected to receive
an Award under this Plan, or, having been so selected, to be selected to receive a future Award.

     11.4 Indemnification. Each person who is or shall have been a member of the Committee, or of
the Board, shall be indemnified and held harmless by the Company against and from (a) any loss,
cost, liability, or expense that may be imposed upon or reasonably incurred by him or her in
connection with or resulting from any claim, action, suit, or proceeding to which he or she may be
a party or in which he or she may be involved by reason of any action taken or failure to act under
the Plan or any Award Agreement, and (b) from any and all amounts paid by him or her in settlement
thereof, with the Company’s approval, or paid by him or her in satisfaction of any judgment in any
such claim, action, suit, or proceeding against him or her, provided he or she shall give the
Company an opportunity, at its own expense, to handle and defend the same before he or she
undertakes to handle and defend it on his or her own behalf. The foregoing right of
indemnification shall not be exclusive of any other rights of indemnification to which such
individuals may be entitled under the Company’s Articles of Incorporation or code of Regulations,
by contract, as a matter of law, or otherwise, or under any power that the Company may have to
indemnify them or hold them harmless.

     11.5 Successors. All obligations of the Company under the Plan, with respect to Awards
granted hereunder, shall be binding on any successor to the Company, whether the existence of such
successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of
all or substantially all of the business or assets of the Company.

     11.6 Beneficiary Designations. If permitted by the Committee, a Participant under the Plan
may name a beneficiary or beneficiaries to whom any vested but unpaid Award shall be paid in the
event of the Participant’s death. Each such designation shall revoke all prior designations by the
Participant and shall be effective only if given in a form and manner acceptable to the Committee.
In the absence of any such designation, any vested benefits remaining unpaid at the Participant’s
death shall be paid to the Participant’s estate and, subject to the terms of the Plan

17

 

and of the applicable Award Agreement, any unexercised vested Award may be exercised by the
administrator or executor of the Participant’s estate.

     11.7 Nontransferability of Awards; Unfunded Plan. No Award granted under the Plan may be
sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will,
by the laws of descent and distribution, or to the limited extent provided in Section 11.5. All
rights with respect to an Award granted to a Participant shall be available during his or her
lifetime only to the Participant. Notwithstanding the foregoing, to the extent provided in the
applicable Award Agreement, a Participant may transfer a Nonqualified Stock Option either (a) to
members of his or her immediate family (as defined in Rule 16a-1 promulgated under the 1934 Act),
to one or more trusts for the benefit of such family members, or to partnerships or other entities
in which such family members are the only partners or owners, provided that the Participant does
not receive any consideration for the transfer, or (b) if such transfer is approved by the
Committee. If such transfer is permitted under the Award Agreement, any Nonqualified Stock Option
held by such transferees are subject to the same terms and conditions that applied to such
Nonqualified Stock Options immediately prior to transfer based on the transferor Participant’s
continuing relationship with the Company or a Related Company. It is intended that the Plan be an
“unfunded” plan for incentive compensation. The Plan does not give a Participant any interest,
lien or claim against any specific asset of the Company or a Related Company. No Participant or
beneficiary shall have any rights under this Plan other than as a general unsecured creditor of the
Company.

     11.8 No Rights as Shareholder. Except to the limited extent provided in Sections 7.6 and 7.7,
no Participant (nor any beneficiary) shall have any of the rights or privileges of a shareholder of
the Company with respect to any Shares issuable pursuant to an Award (or exercise thereof), unless
and until certificates representing such Shares shall have been issued, recorded on the records of
the Company or its transfer agents or registrars, and delivered to the Participant (or
beneficiary).

     11.9 Withholding Requirements. Prior to the delivery of any Shares or cash pursuant to an
Award (or exercise thereof), the Company shall have the power and the right to deduct or withhold,
or require a Participant to remit to the Company, an amount sufficient to satisfy Federal, state,
and local taxes (including the Participant’s FICA obligation) required to be withheld with respect
to such Award (or exercise thereof).

     11.10 Withholding Arrangements. The Committee, in its sole discretion and pursuant to such
procedures as it may specify from time to time, may permit or require a Participant to satisfy all
or part of the tax withholding obligations in connection with an Award by (a) having the Company
withhold otherwise deliverable Shares, or (b) delivering to the Company already-owned Shares having
a Fair Market Value equal to the amount required to be withheld. The amount of the withholding
requirement shall be deemed to include any amount which the Committee determines, not to exceed the
amount determined by using the minimum federal, state or local marginal income tax rates applicable
to the Participant with respect to the Award on the date that the amount of tax to be withheld is
to be determined. The Fair Market Value of the Shares to be withheld or delivered shall be
determined as of the date that the taxes are required to be withheld.

18

 

     11.11 Payments Upon Income Inclusion Under Code Section 409A. The Company may accelerate the
time or schedule of a payment to a Participant to pay an amount the Participant includes in income
as a result of the Plan failing to meet the requirements of Code Section 409A.

12. AMENDMENT, TERMINATION AND DURATION

     12.1 Amendment, Suspension, or Termination. The Board, in its sole discretion, may amend or
terminate the Plan, or any part thereof, at any time and for any reason. However, if and to the
extent required to maintain the Plan’s qualification under applicable law or stock exchange
regulation, any such amendment shall be subject to shareholder approval. In addition, as required
by Rule 16b-3, the provisions of Section 9 regarding the formula for determining the amount,
Exercise Price, and timing of Nonemployee Director Options shall in no event be amended more than
once every six (6) months, other than to comport with changes in the Code. The amendment,
suspension, or termination of the Plan shall not, without the consent of the Participant, alter or
impair any rights or obligations under any Award previously granted to such Participant. No Award
may be granted during any period of suspension or after termination of the Plan.

     12.2 Duration of the Plan. The Plan shall commence on the date specified herein, and subject
to Section 12.1 (regarding the Board’s right to amend or terminate the Plan), shall remain in
effect thereafter. However, without further shareholder approval, no Incentive Stock Option may be
granted under the Plan after December 4, 2010.

13. LEGAL CONSTRUCTION

     13.1 Gender and Number. Except where otherwise indicated by the context, any masculine term
used herein also shall include the feminine; the plural shall include the singular and the singular
shall include the plural.

     13.2 Severability. In the event any provision of the Plan shall be held illegal or invalid
for any reason, the illegality or invalidity shall not affect the remaining parts of the Plan, and
the Plan shall he construed and enforced as if the illegal or invalid provision had not been
included.

     13.3 Requirements of Law. The granting of Awards and the issuance of Shares under the Plan
shall be subject to all applicable laws, rules, and regulations, and to such approvals by any
governmental agencies or national securities exchanges as may be required.

     13.4 Compliance with Rule 16b-3. Transactions under this Plan with respect to Section 16
Persons are intended to comply with all applicable conditions of Rule 16b-3. To the extent any
provision of the Plan, Award Agreement or action by the Committee fails to so comply, it shall be
deemed null and void, to the extent permitted by law and deemed advisable by the Committee.
Notwithstanding any contrary provision of the Plan, if the Committee specifically determines that
compliance with Rule 16b-3 no longer is required, all references in the Plan to Rule 16b-3 shall be
null and void.

     13.5 Governing Law. The Plan and all Award Agreements shall be construed in accordance with
and governed by the laws of the State of Ohio.

19

 

     13.6 Captions. Captions are provided herein for convenience only, and shall not serve as a
basis for interpretation or construction of the Plan.

20EX-10.96

Exhibit 10.96

SECOND AMENDED AND RESTATED

RETAIL VENTURES, INC.

NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN

1. PURPOSE. This plan (the “Plan”) is intended as an incentive and to encourage stock ownership by
directors of RETAIL VENTURES, INC., an Ohio corporation (the “Company”) who are not employees of
the Company or any subsidiary or parent of the Company (“Non-employee Directors”) by the granting
of stock options (the “Options”) as provided herein. By encouraging such stock ownership, the
Company seeks to attract, retain and motivate highly qualified Non-employee Directors.

2. EFFECTIVE DATE. The Plan first became effective on September 24, 1992 (the “Effective Date”).
The Plan is amended and restated for a second time effective January 1, 2008.

3. ADMINISTRATION.

     (a) The Plan shall be administered by the Board of Directors of the Company (the “Board”),

     (b) Subject to the provisions of the Plan, the Board is authorized to establish, amend and
rescind such rules and regulations as it may deem appropriate for its conduct and for the proper
administration of the Plan, to make all determinations under and interpretations of, and to take
such actions in connection with, the Plan or the Options granted thereunder as it may deem
necessary or advisable. All actions taken by the Board under the Plan shall be final and binding on
all persons. No member of the Board shall be liable for any action taken or determination made
relating to the Plan, except for willful misconduct.

4. ELIGIBILITY AND TERMS. On the first New York Stock Exchange (“NYSE”) trading day in each
calendar quarter, each Non-employee Director shall be granted under this Plan an Option to purchase
1,000 Shares (as hereinafter defined) at an exercise price equal to 100% of the fair market value
of the Shares on the date of grant. Each Option shall not be exercisable until a period of one year
from the date of grant and shall terminate on the NYSE trading day following the tenth anniversary
of the date of grant, except that in the event of the Optionee’s termination of service as a result
of disability or death as specified in subparagraph 9(b) of this Plan, the Option shall be
immediately exercisable to the extent and for the period specified in subparagraph 9(b); (ii) in
the event of the Optionee’s termination of service as specified in subparagraph 9(a), the Option
shall be immediately exercisable to the extent and for the period specified in subparagraph 9(a);
and (iii) in the event of a liquidation or merger as specified in subparagraph 10(b), the Option
shall be immediately exercisable in full for the period specified in subparagraph 10(b).

5. STOCK SUBJECT TO PLAN. The stock subject to Options under the Plan shall be Common Shares
without par value of the Company (“Shares”). The Shares issued pursuant to Options granted under
the Plan may be authorized and unissued Shares, Shares purchased on the open market or in a private
transaction, or Shares held as treasury stock. The aggregate number of Shares for which options may
be granted under the Plan shall not exceed 250,000, subject to

 

 

adjustment in accordance with the terms of paragraph 10 hereof. The unpurchased Shares subject to
terminated or expired options may again be offered under the Plan. Proceeds from the sale of shares
under Options shall constitute general funds of the Company.

6. OPTION AGREEMENT. Within a reasonable time after the date of grant, all options granted shall
be evidenced by stock option agreements in writing (“Stock Option Agreements”), in the form
attached hereto as Exhibit A, or in such other form and containing such terms and conditions not
inconsistent with the provisions of this Plan as the Board shall from time to time determine. Any
action under paragraph 10 may be reflected in an amendment to or restatement of such Stock Option
Agreements.

7. TRANSFERABILITY OF OPTIONS. An Optionee may transfer an Option either (a) to members of his or
her immediate family (as defined in Rule 16a-1 promulgated under the 1934 Act), to one or more
trusts for the benefit of such family members, or to partnerships in which such family members are
the only partners, provided that the Optionee does not receive any consideration for the transfer,
or (b) if such transfer is approved by the Board. Any Options held by such transferees are subject
to the same terms and conditions that applied to such options immediately prior to transfer.

8. EXERCISE OF OPTIONS.

     (a) Notwithstanding the terms and conditions of any Stock Option Agreement to the contrary,
(i) in the event of the Optionee’s termination of service as a result of disability or death as
specified in subparagraph 9(b), the Options shall he immediately exercisable to the extent and for
the period specified in subparagraph 9(b); (ii) in the event of Optionee’s termination of service
as specified in subparagraph 9(a), the Options shall be immediately exercisable to the extent and
for the period specified in subparagraph 9(a); and (iii) in the event of a liquidation or merger as
specified in subparagraph 10(b), the options shall be immediately exercisable in full for the
period specified in subparagraph 10(b).

     (b) An Option shall be exercisable only upon delivery of a written notice to the Company’s
Treasurer, or any other officer of the Company designated by the Board to accept such notices on
its behalf, specifying the number of Shares for which it is exercised.

     (c) Within five business days following the date of exercise of an Option, the Optionee or
other person exercising the option shall make full payment of the Option Price (i) in cash; (ii)
with the consent of the Board, by tendering previously acquired Shares (valued at their fair market
value, as of the trading day immediately prior to such date of tender); (iii) with the consent of
the Board, with a full recourse promissory note of the Optionee for the portion of the option Price
in excess of the par value of Shares subject to the Option, under terms and conditions determined
by the Board; (iv) with the consent of the Board, any combination of (i), (ii), or (iii); or (v)
with the consent of the Board, if the Shares subject to the Option have been registered under the
1933 Act and there is a regular public market for the Shares, by delivering to the Company on the
date of exercise of the Option written notice of exercise together with:

2

 

          (A) Written instructions to forward a copy of such notice of exercise to a broker or dealer,
as defined in section 3(a)(4) and 3(a)(5) of the 1934 Act (“Broker”), designated in such notice
and to deliver to the specified account maintained with the Broker by the person exercising the
Option a certificate for the Shares purchased upon the exercise of the option, and

          (B) A copy of irrevocable instructions to the Broker to deliver promptly to the Company a sum
equal to the purchase price of the Shares purchased upon exercise of the option.

     (d) If cash payments sufficient to allow for any withholding of taxes are not being made at
the time of exercise of an option, the Optionee or other person exercising such option shall pay to
the Company an amount equal to the withholding amount required to be made less any amount withheld
by the Company under paragraph 15.

9. TERMINATION OF SERVICES.

     (a) Upon termination of service as a Director of the Company, other than (i) termination by
reason of death or disability (as defined in subparagraph 22(a) of the Plan), or (ii) termination
for cause (as defined in subparagraph 22(d) of the Plan), the Optionee shall have 90 days after the
date of termination (but not later than the expiration date of the Stock Option Agreement) to
exercise all Options held by him or her to the extent the same were exercisable on the date of
termination; provided, however, if such termination is due to the Optionee’s retirement with the
consent of the Company, such Option shall then be exercisable to the extent of 100% of the Shares
subject thereto. The Board shall determine in each case whether a termination of service shall be
considered a retirement with the consent of the Company and, subject to applicable law, whether a
leave of absence shall be considered a termination of service. The Board may cancel an Option
during the 90-day period after termination of service referred to in this paragraph if the Optionee
engages in employment or activities contrary, in the sole opinion of the Board, to the best
interests of the Company or any parent or subsidiary of the Company.

     (b) Upon termination of service by reason of death or disability, all Options previously
granted to such Optionee may be exercised by the Optionee, the Optionee’s personal representative,
or the person or persons to whom his or her rights under the options pass by will or the laws of
descent or distribution whether or not the same were exercisable on the date of death or disability
at any time during the period ending one year after date of death or termination of employment by
reason of disability (but not later than the expiration date of the Stock option Agreement).

     (c) Upon termination of service for cause, all Options held by such Optionee shall terminate
on the date of termination.

10. REORGANIZATIONS.

     (a) In the event of a stock split, stock dividend, combination or exchange of shares, exchange
for other securities, reclassification, reorganization, redesignation or other change in the
Company’s capitalization, the aggregate number of Shares for which Options may be granted under
this Plan, the number of Shares subject to outstanding options and the Option Price of the

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Shares subject to outstanding options shall be proportionately adjusted or substituted to reflect
the same. The Board shall make such other adjustments to the Options, the provisions of the Plan
and the Stock option Agreements as may be appropriate and equitable, which adjustments may provide
for the elimination of fractional Shares. Any adjustment made pursuant to this Section 10 shall,
to the extent applicable, be consistent with the requirements of Sections 409A and 424 of the
Internal Revenue Code of 1986, as amended (“Code”).

     (b) if the Company shall liquidate or dissolve, or shall be a party to a merger or
consolidation in which the Company shall not be the surviving corporation, other than a merger or
consolidation involving only a change in state of incorporation or an internal reorganization not
involving a substantial change in underlying ownership, the Company shall give written notice
thereof to all holders of Options granted under the Plan at least 30 days prior to the effective
date of such liquidation, dissolution, merger or consolidation, and the holders shall have the
right within such 30-day period to exercise their Options to the extent of 100% of the Shares
subject thereto regardless of restrictions an exercise or vesting percentages contained in the
Stock Option Agreements; provided, however, that in no event shall such options be exercised after
the specific expiration date set forth therein. To the extent such Options shall not have been
exercised on or prior to the effective date of such liquidation, dissolution, merger or
consolidation, they shall terminate on that date.

11. SALE OF OPTION SHARES. If any class of equity securities of the company is registered pursuant
to Section 12 of the 1934 Act, any Optionee or other person exercising the Option who is subject to
Section 16 of the 1934 Act by virtue of his or her relationship to the Company shall not sell or
otherwise dispose of the shares subject to Option unless at least six months have elapsed from the
date of grant of the Option.

12. RIGHTS AS SHAREHOLDER. The Optionee shall have no rights as a shareholder with respect to any
Shares covered by an Option until the date of issuance of a stock certificate to the Optionee for
such Shares.

13. NO CONTRACT OF EMPLOYMENT. Nothing in the Plan or in any Option or Stock Option Agreement shall
confer on any Optionee any right to continue in the service of the Company or any parent or
subsidiary of the Company or interfere with the right of the Company to terminate such Optionee’s
services at any time. The establishment of the Plan shall in no way, now or hereafter, reduce,
enlarge or modify the relationship between the Company or any parent or subsidiary of the Company
and the Optionee. Options granted under the Plan shall not be affected by any change of duties or
position as long as the Optionee continues to serve as a Director of the Company.

14. AGREEMENTS AND REPRESENTATIONS OF OPTIONEES. As a condition to the exercise of an Option, the
Board may, in its sole determination, require the Optionee to represent in writing that the Shares
being purchased are being purchased only for investment and without any present intent at the time
of the acquisition of such Shares to sell or otherwise dispose of the same.

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15. WITHHOLDING TAXES. The Company shall have the right to withhold from any compensation for
services payable by the Company to or with respect to an Optionee, amounts sufficient to satisfy
any federal, state or local withholding tax liability attributable to such Optionee’s (or any
beneficiary’s or personal representative’s) receipt or disposition of Shares purchased under any
Option or to take any such other action as it deems necessary to enable it to satisfy any such tax
withholding obligations. The Board, in its sole discretion, may permit Optionees to elect to have
Shares that would be acquired upon exercise of Options (valued at their fair market value as of the
date of exercise) withheld by the Company in satisfaction of such Optionees, withholding tax
liabilities,

16. COMPLIANCE WITH LAWS AND REGULATIONS. The Plan, the grant and exercise of Options hereunder,
and the obligation of the Company to sell and deliver the Shares under such options, shall be
subject to all applicable federal and state laws, rules and regulations and to such approvals by
any government or regulatory agency as may be required. Options issued under this Plan shall not be
exercisable prior to (i) the date upon which the Company shall have registered the Shares for which
Options may be issued hereunder under the 1933 Act, and (ii) the completion of the listing of such
shares on the New York Stock Exchange and any registration or qualification of such Shares under
state law, or any ruling or regulation of any government body which the Company shall, in its sole
discretion, determine to be necessary or advisable in connection therewith, or alternatively,
unless the Company shall have received an opinion from counsel to the Company stating that the
exercise of such options may be effected without registering the Shares subject to such Options
under the 1933 Act, or under state or other law.

17. ASSUMPTION. The Plan may be assumed by the successors and assigns of the Company.

18. EXPENSES. All expenses and costs in connection with administration of the Plan shall be borne
by the Company.

19. AMENDMENT, MODIFICATION AND TERMINATION OF THE PLAN. The Board may terminate, amend or modify
the Plan at any time without further action on the part of the shareholders of the company;
provided, however, that (a) any amendment to the Plan which requires the approval of the
shareholders of the Company under the Code or the regulations promulgated thereunder shall be
subject to approval by the shareholders of the Company in accordance with the Code or such
regulations; and (b) any amendment to the Plan which requires the approval of the shareholders of
the Company under the rules promulgated under section 16 of the 1934 Act shall be subject to the
approval of the shareholders of the company in accordance with such rules. No amendment,
modification or termination of the Plan shall in any manner adversely affect any option previously
granted to an Optionee under the Plan without the consent of the Optionee.

20. TERM OF PLAN. The Plan became effective on the Effective Date and terminated on the tenth
anniversary of the Effective Date. Termination of the Plan, however, did not affected the rights of
Optionees under Options previously granted to them, and all unexpired options shall continue in
force and operation after termination of the Plan except as they may lapse or be terminated by
their own terms and conditions.

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21. LIMITATION OF LIABILITY. The liability of the Company under this Plan or in connection with
any exercise of an Option is limited to the obligations expressly set forth in the Plan and in any
Stock Option Agreements, and no term or provision of this Plan or of any Stock option Agreements
shall be construed to impose any further or additional duties, obligations or costs on the Company
not expressly set forth in the Plan or the Stock Option Agreements.

22. DEFINITIONS.

     (a) Disability. “Disability,” as used herein, shall mean a physical or mental condition
resulting from bodily injury, disease, or mental disorder which renders the Optionee incapable of
continuing the Optionee’s usual and customary service with the Company or any parent or subsidiary
of the Company.

     (b) Fair Market Value. If the Shares are publicly traded, the term “fair market value” as
used in this Plan shall mean (a) the average of the highest and lowest sale prices quoted in the
NASDAQ National Market System, if the shares are so quoted, (b) the mean between the lowest bid and
highest asked price per Share as reported by NASDAQ, if the Shares are not quoted in the National
Market System, or (c) if the Shares are listed on a securities exchange, the arithmetic mean
between the high and low sales price per Share at which the Shares are quoted or traded on such
exchange, in each case on the date the Option is granted or, if there be no quotation or sale on
that date, the next previous date on which the Shares were quoted or traded. If the Shares are not
publicly traded, the “fair market value” of the Shares shall be determined by the Board through the
reasonable application of a reasonable valuation method, taking into account all information
material to the value of the Company, in accordance with the requirements of Section 409A of the
Code.

     (c) Parent and Subsidiary. The terms “subsidiary” and “parent” as used in the Plan shall have
the respective meanings set forth in sections 424(f) and (e) of the Code.

     (d) Termination For Cause. The term “termination of employment or service for cause” shall
mean termination of employment or service for (a) the commission of an act of dishonesty, including
but not limited to misappropriation of funds or property of the Company; (b) the engagement in
activities or conduct injurious to the reputation of the Company; (c) the conviction or entry of a
guilty or no contest plea to a misdemeanor (involving an act of moral turpitude) or a felony; (d)
the violation of any of the terms and conditions of any written agreement the person may have from
time to time with the Company or any of its subsidiaries (following 30 days, written notice from
the Company specifying the violation and the employee’s failure to cure such violation within such
30-day period) or (e) any refusal to comply with the written directives, policies or regulations
established from time to time by the Board.

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