Document:

2003 Incentive Stock Plan

 Exhibit 10.4 
 The Boeing Company 2003 Incentive Stock Plan 
 (As Amended and Restated Effective January 1, 2008)

 Section 1. Purpose of the Plan 
 The purpose of The Boeing Company 2003 Incentive Stock Plan (the “Plan”), as amended and restated subject to shareholder approval, is to attract, retain and motivate employees, officers, directors, consultants, agents, advisors
and independent contractors of The Boeing Company (the “Company”) by providing them the opportunity to acquire a proprietary interest in the Company and to link their interests and efforts to the long-term interests of the Company’s
shareholders. 
 Section 2. Definitions 
 As used in the Plan, 
 “Adjusted Operating Cash Flow” means the net cash provided by operating activities of the Company as
reported in the Company’s consolidated statement of cash flows included in its Annual Report on Form 10-K, adjusted to eliminate the effect on operating cash flows of net customer financing cash flows, as reported in the Company’s
consolidated statement of cash flows included in its Annual Report on Form 10-K. 
 “Award” means any Option, Stock Appreciation Right,
Restricted Stock, Stock Unit, Performance Share, Performance Unit, dividend equivalent, cash-based award or other incentive payable in cash or in shares of Common Stock as may be designated by the Committee from time to time. 
 “Board” means the Board of Directors of the Company. 
 “Code” means the Internal Revenue Code of 1986, as amended from time to time. 
 “Committee” has the meaning set
forth in Section 3.1. 
 “Common Stock” means the common stock, par value $5.00 per share, of the Company. 
 “Company” means The Boeing Company, a Delaware corporation. 
 “Covered Employee” means a “covered employee” as that term is defined in Section 162(m)(3) of the Code or any successor provision. 
 “Disability” means “Disability” as defined by the Committee or the Company’s vice president of compensation and benefits for purposes of the Plan or an Award or in the instrument
evidencing the Award or in a written employment or services agreement between the Participant and the Company or a Related Company. 
 “Effective
Date” has the meaning set forth in Section 18. 
 “Exchange Act” means the Securities Exchange Act of 1934, as amended from
time to time. 
 “Fair Market Value” means the average of the high and low per share trading prices (or the average of the opening and
closing prices, or the closing price, if so determined by the Committee) for the Common Stock on the New York Stock Exchange during regular session trading as reported to the Company by The Wall Street Journal or such other source the
Committee deems reliable for a single trading day. The Committee may vary its determination of the Fair Market Value as provided in this Section 2 depending on whether Fair Market Value is in reference to the grant, exercise, vesting,
settlement or payout of an Award and, for Awards subject to 409A, as provided in Section 409A. 
 “Grant Date” means the date on which
the Committee completes the corporate action authorizing the grant of an Award or such later date specified by the Committee, provided that conditions to the exercisability or vesting of Awards shall not defer the Grant Date. 
  

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 “Incentive Stock Option” means an Option granted with the intention that it qualify as an
“incentive stock option” as that term is defined in Section 422 of the Code or any successor provision. 
 “Layoff” means
“Layoff” as defined by the Committee or the Company’s vice president of compensation and benefits for purposes of the Plan or an Award or in the instrument evidencing the Award or in a written employment or services agreement between
the Participant and the Company or a Related Company. 
 “Nonqualified Stock Option” means an Option other than an Incentive Stock Option.

 “Nonrecurring Items” means nonrecurring items deemed not reflective of the Company’s core operating performance, including, but not
limited to, exogenous events, acquisitions, divestitures, changes in accounting principles or “extraordinary items” determined under generally accepted accounting principles. 
 “Option” means a right to purchase Common Stock granted under Section 7. 
 “Participant” means any eligible person as set forth in Section 5 to whom an Award is granted. 
 “Performance
Criteria” has the meaning set forth in Section 11.2. 
 “Performance Period” means any period as determined by the Committee
in its sole discretion. The Committee may establish different Performance Periods for different Participants, and the Committee may establish concurrent or overlapping Performance Periods. 
 “Performance Share” has the meaning set forth in Section 10.1. 
 “Performance Unit” has the meaning set forth in Section 10.2. 
 “Plan” means The
Boeing Company 2003 Incentive Stock Plan. 
 “Related Company” means any corporation in which the Company owns, directly or indirectly, at
least 50% of the total combined voting power of all classes of stock, or any other entity (including, but not limited to, partnerships and joint ventures) in which the Company owns, directly or indirectly, at least 50% of the combined equity
thereof. Notwithstanding the foregoing, for purposes of determining whether any individual may be a Participant for purposes of any grant of Incentive Stock Options, the term “Related Company” shall have the meaning ascribed to the term
“subsidiary” in Section 424(f), and for purposes of determining whether any individual may be a Participant for purposes of any grant of Options or Stock Appreciation Rights, the term “Related Company” shall mean any
“Service Recipient” as that term is defined for purposes of Section 409A. 
 “Restricted Stock” means an Award of shares of
Common Stock granted under Section 9, the rights of ownership of which may be subject to restrictions prescribed by the Committee. 
 “Retirement” means termination of employment voluntarily at a time when a Participant is entitled to begin immediate receipt of early or normal retirement benefits under one or more of the Company’s defined benefit
pension plans, or under comparable terms of a Related Company’s pension plan, as then in effect, unless provided otherwise in the instrument evidencing the Award or in a written employment or services agreement between the Participant and the
Company or a Related Company. 
 “Section 162(m)” means Code Section 162(m), including any proposed and final regulations and other
guidance issued thereunder by the Department of the Treasury and/or the Internal Revenue Service. 
 “Section 409A” means Code
Section 409A, including any proposed and final regulations and other guidance issued thereunder by the Department of the Treasury and/or the Internal Revenue Service. 
 “Securities Act” means the Securities Act of 1933, as amended from time to time. 
 “Stock
Appreciation Right” or “SAR” has the meaning set forth in Section 8.1. 
 “Stock Unit” means an Award granted under
Section 9 denominated in units of Common Stock. 
  

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 “Substitute Awards” means Awards granted or shares of Common Stock issued by the Company in assumption
of, or in substitution or exchange for, awards previously granted by a company acquired by the Company or with which the Company combines. 
 “Termination of Service,” unless otherwise defined by the Committee or the Company’s vice president of compensation and benefits or in the instrument evidencing the Award or in a written employment or services
agreement, means a termination of employment or service relationship with the Company or a Related Company for any reason, whether voluntary or involuntary, including by reason of death, Disability, Retirement or Layoff. Any question as to whether
and when there has been a Termination of Service for the purposes of an Award and the cause of such Termination of Service shall be determined by the Company’s vice president of compensation and benefits or by the Committee with respect to
officers subject to the reporting requirements of Section 16(a) of the Securities Act, and such determination shall be final. Transfer of a Participant’s employment or service relationship between wholly owned subsidiaries of the Company,
or between the Company and any wholly owned subsidiaries of the Company, shall not be considered a Termination of Service for purposes of an Award. Unless the Committee determines otherwise, a Termination of Service shall be deemed to occur if the
Participant’s employment or service relationship is with an entity that has ceased to be a Related Company. 
 Section 3. Administration 
 3.1 Administration of the Plan 
 The Plan shall be administered by the Compensation Committee of the Board; provided, however, that with respect to nonemployee directors, the Plan shall be administered by the Governance, Organization and Nominating
Committee of the Board unless otherwise determined by the Board. Each such committee shall be comprised of at least three directors, each of whom shall qualify as an “outside director” as defined by Section 162(m), an
“independent director” as defined under the New York Stock Exchange listing standards and a “non-employee director” as defined in Rule 16b-3 promulgated under the Exchange Act. However, the fact that a Committee member shall fail
to qualify under the foregoing requirements shall not invalidate any Award made by the Committee which is otherwise validly made under the Plan. 
 3.2
Delegation by Committee 
 Notwithstanding the foregoing, the Board or the Committee may delegate responsibility for administering the Plan with respect
to designated classes of eligible persons to different committees consisting of one or more members of the Board, subject to such limitations as the Board or the Compensation Committee deems appropriate, except with respect to benefits to
nonemployee directors and to officers subject to Section 16 of the Exchange Act or officers who are or may be Covered Employees. Members of any committee shall serve for such term as the Board may determine, subject to removal by the Board at
any time. To the extent consistent with applicable law, the Board or the Committee may authorize one or more officers of the Company to grant Awards to designated classes of eligible persons, within limits specifically prescribed by the Board or the
Committee; provided, however, that no such officer shall have or obtain authority to grant Awards to himself or herself or to any person subject to Section 16 of the Exchange Act. All references in the Plan to the “Committee” shall
be, as applicable, to the Compensation Committee, the Governance, Organization and Nominating Committee or any other committee or any officer to whom the Board or the Compensation Committee has delegated authority to administer the Plan. 

3.3 Administration and Interpretation by Committee 
 Except for the
terms and conditions explicitly set forth in the Plan, the Committee shall have full power and exclusive authority, subject to such orders or resolutions not inconsistent with the provisions of the Plan as may from time to time be adopted by the
Board, to (a) select the eligible persons as set forth in Section 5 to whom Awards may from time to time be granted under the Plan; (b) determine the type or types of Award to be granted to each Participant under the Plan;
(c) determine the number of shares of Common Stock to be covered by each Award granted under the Plan; (d) determine the terms and conditions of any Award granted under the Plan; (e) approve the forms of agreements for use under the
Plan; (f) determine whether, to what extent and under what circumstances Awards may be settled in cash, shares of Common Stock or other property or canceled or suspended; (g) determine whether, to what extent and under what circumstances
cash, shares of Common Stock, other property and other amounts payable with respect to an Award shall be deferred either automatically or at the election of the Participant, subject to Section 409A and in accordance with Section 6.3;
(h) interpret and administer the Plan and any instrument or agreement entered into under the Plan; 

  

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(i) establish such rules and regulations and appoint such agents as it shall deem appropriate for the proper administration of the Plan;
(j) delegate ministerial duties to such of the Company’s officers as it so determines; and (k) make any other determination and take any other action that the Committee deems necessary or desirable for administration of the Plan.
Decisions of the Committee shall be final, conclusive and binding on all persons, including the Company, any Participant, any shareholder and any eligible person. A majority of the members of the Committee may determine its actions and fix the time
and place of its meetings. 
 Section 4. Shares Subject to the Plan 
 4.1 Authorized Number of Shares 
 Subject to adjustment from time to
time as provided in Section 15, the maximum number of shares of Common Stock available for issuance under the Plan shall be 60 million. 
 4.2 Share
Usage 
 (a) Shares of Common Stock covered by an Award shall not be counted as used unless and until they are actually issued and delivered to a
Participant. If any Award lapses, expires, terminates or is canceled prior to the issuance of shares thereunder or if shares of Common Stock are issued under the Plan to a Participant and thereafter are reacquired by the Company, the shares subject
to such Awards and the reacquired shares shall again be available for issuance under the Plan. In addition, the following shares of Common Stock shall not be treated as having been issued under the Plan: (i) shares tendered by a Participant or
retained by the Company as full or partial payment to the Company for the purchase price of an Award or to satisfy tax withholding obligations in connection with an Award, (ii) shares covered by an Award that is settled in cash, (iii) the
number of shares subject to a SAR in excess of the number of shares that are delivered to the Participant upon exercise of the SAR, or (iv) shares issued pursuant to Substitute Awards. The number of shares available for issuance under the Plan
shall not be reduced to reflect any dividends or dividend equivalents that are reinvested into additional shares or credited as additional Restricted Stock, Stock Units or Performance Shares. All shares issued under the Plan may be either authorized
and unissued shares or issued shares reacquired by the Company. 
 (b) The Committee shall have the authority to grant Awards as an alternative to or as
the form of payment for grants or rights earned or due under other compensation plans or arrangements of the Company. 
 (c) Notwithstanding the
foregoing, the maximum number of shares that may be issued upon the exercise of Incentive Stock Options shall equal the aggregate share number stated in Section 4.1, subject to adjustment as provided in Section 15. 
 4.3 Limitations 
 (a) Subject to adjustment as provided in
Section 15, the aggregate number of shares that may be issued pursuant to Awards granted under the Plan (other than Awards of Options or Stock Appreciation Rights) that are not (i) subject to restrictions based on the satisfaction of
specified performance goals or (ii) granted in lieu of the payment of performance-based cash incentive awards shall not exceed 12 million. 
 (b) Subject to adjustment as provided in Section 15, the aggregate number of shares that may be issued pursuant to Awards granted under the Plan (other than Awards of Options or Stock Appreciation Rights) that contain no
restrictions or restrictions based solely on continuous employment or services for less than three years (except where Termination of Service occurs by reason of death, Retirement, Disability or Layoff) shall not exceed 3 million. 
 Section 5. Eligibility 
 An Award may be
granted to any employee, officer or director of the Company or a Related Company whom the Committee from time to time selects. An Award may also be granted to any consultant, agent, advisor or independent contractor for bona fide services rendered
to the Company or any Related Company that (a) are not in connection with the offer and sale of the Company’s securities in a capital-raising transaction and (b) do not directly or indirectly promote or maintain a market for the
Company’s securities. The above are “eligible persons.” 
  

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 Section 6. Awards 
 6.1 Form and Grant of Awards 
 The Committee shall have the authority, in its sole discretion, to determine the type
or types of Awards to be granted under the Plan. Such Awards may be granted either alone, in addition to or in tandem with any other type of Award. 
 6.2
Evidence of Awards 
 Awards granted under the Plan shall be evidenced by a written instrument that shall contain such terms, conditions, limitations and
restrictions as the Committee shall deem advisable and that are not inconsistent with the Plan. 
 6.3 Deferrals 
 The Committee may permit a Participant to defer receipt of the payment of any Award. If any such deferral election is permitted, the Committee, in its sole discretion,
shall establish rules and procedures for such payment deferrals, which may include the grant of additional Awards or provisions for the payment or crediting of interest or dividend equivalents, including converting such credits to deferred stock
unit equivalents. The value of the payment so deferred may be allocated to a deferred account established for a Participant under any deferred compensation plan of the Company designated by the Committee. Notwithstanding the foregoing, any deferral
made under this Section 6.3 will be made under a deferred compensation plan of the Company or pursuant to the terms of an employment agreement, either of which satisfies the requirements for exemption from or complies with Section 409A.

 6.4 Dividends and Distributions 
 Participants holding
Awards may, if the Committee so determines, be credited with dividends paid with respect to the underlying shares or dividend equivalents while the Awards are so held in a manner determined by the Committee in its sole discretion. The Committee may
apply any restrictions to the dividends or dividend equivalents that the Committee deems appropriate. The Committee, in its sole discretion, may determine the form of payment of dividends or dividend equivalents, including cash, shares of Common
Stock, Restricted Stock or Stock Units. Notwithstanding the foregoing, the right to any dividends or dividend equivalents declared and paid on the number of shares underlying an Option or a Stock Appreciation Right may not be contingent, directly or
indirectly on the exercise of the Option or a Stock Appreciation Right, and an Award providing a right to dividends or dividend equivalents declared and paid on the number of shares underlying an Option or a Stock Appreciation Right, the payment of
which is not contingent upon, or otherwise payable on, the exercise of the Option or a Stock Appreciation Right, must comply with or qualify for an exemption under Section 409A. 
 Section 7. Options 
 7.1 Grant of Options 
 The Committee may grant Options designated as Incentive Stock Options or Nonqualified Stock Options. 
 7.2 Option Exercise Price 
 The exercise price for shares purchased under an Option shall be as determined by the
Committee, but shall not be less than 100% of the Fair Market Value of the Common Stock for the Grant Date, except in the case of Substitute Awards. In no event shall the Committee, without the prior approval of the Company’s shareholders,
cancel any outstanding Option for the purpose of reissuing the Option to the Participant at a lower exercise price or reduce the exercise price of an outstanding Option. 
 7.3 Term of Options 
 Subject to earlier termination in accordance with the terms of the Plan and the instrument
evidencing the Option, the maximum term of an Option shall be a term not to exceed ten years from the Grant Date as established for that Option by the Committee or, if not so established, shall be ten years from the Grant Date. 
  

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 7.4 Exercise of Options 
 The Committee shall establish and set forth in each instrument that evidences an Option the time at which, or the installments in which, the Option shall vest and become exercisable, any of which provisions may be waived or modified by the
Committee at any time. 
 To the extent an Option has vested and become exercisable, the Option may be exercised in whole or from time to time in part by
delivery as directed by the Company to the Company or a brokerage firm designated or approved by the Company of a written stock option exercise agreement or notice, in a form and in accordance with procedures established by the Committee, setting
forth the number of shares with respect to which the Option is being exercised, the restrictions imposed on the shares purchased under such exercise agreement, if any, and such representations and agreements as may be required by the Committee,
accompanied by payment in full as described in Section 7.5. An Option may be exercised only for whole shares and may not be exercised for less than a reasonable number of shares at any one time, as determined by the Committee. 
 7.5 Payment of Exercise Price 
 The exercise price for shares
purchased under an Option shall be paid in full as directed by the Company to the Company or a brokerage firm designated or approved by the Company by delivery of consideration equal to the product of the Option exercise price and the number of
shares purchased. Such consideration must be paid before the Company will issue the shares being purchased and must be in a form or a combination of forms acceptable to the Committee for that purchase, which forms may include: (a) check;
(b) wire transfer; (c) tendering by attestation shares of Common Stock already owned by the Participant that on the day prior to the exercise date have a Fair Market Value equal to the aggregate exercise price of the shares being purchased
under the Option, provided that the Participant must have held for at least six months any such tendered shares that were acquired by the Participant under a Company-sponsored stock compensation program; (d) to the extent permitted by
applicable law, delivery of a properly executed exercise notice, together with irrevocable instructions to a brokerage firm designated or approved by the Company to deliver promptly to the Company the aggregate amount of sale or loan proceeds to pay
the Option exercise price and any tax withholding obligations that may arise in connection with the exercise, all in accordance with the regulations of the Federal Reserve Board; or (e) such other consideration as the Committee may permit in
its sole discretion. 
 7.6 Post-Termination Exercise 
 The Committee shall establish and set forth in each instrument that evidences an Option whether the Option shall continue to be exercisable, and the terms and conditions of such exercise, after a Termination of Service, any of which
provisions may be waived or modified by the Committee at any time, provided that any such waiver or modification shall satisfy the requirements for exemption under Section 409A. 
 7.7 Incentive Stock Options 
 The terms of any Incentive Stock Options shall comply in all respects with the
provisions of Section 422 of the Code, or any successor provision, and any regulations promulgated thereunder. Individuals who are not employees of the Company or one of its parent or subsidiary corporations (as such terms are defined for
purposes of Section 422 of the Code) may not be granted Incentive Stock Options. To the extent that the aggregate Fair Market Value of Common Stock with respect to which Incentive Stock Options are exercisable for the first time by a
Participant during any calendar year exceeds $100,000 or, if different, the maximum limitation in effect at the time of grant under the Code (the Fair Market Value being determined as of the Grant Date for the Option), such portion in excess of
$100,000 shall be treated as Nonqualified Stock Options. 
 Section 8. Stock Appreciation Rights 
 8.1 Grant of Stock Appreciation Rights 
 The Committee may grant stock
appreciation rights (“Stock Appreciation Rights” or “SARs”) to Participants at any time. An SAR may be granted in tandem with an Option or alone (“freestanding”). The grant price of a tandem SAR shall be equal to the
exercise price of the related Option, and the grant price of a freestanding SAR shall be equal to the Fair Market Value of the Common Stock for the Grant Date, except for Substitute Awards. An SAR may be exercised upon such terms and conditions and
for the term as the 

  

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Committee determines in its sole discretion; provided, however, that, subject to earlier termination in accordance with the terms of the Plan and the
instrument evidencing the SAR, the term of a freestanding SAR shall be a term not to exceed ten years from the Grant Date as established for that SAR by the Committee or, if not so established, shall be ten years, and in the case of a tandem SAR,
(a) the term shall not exceed the term of the related Option and (b) the tandem SAR 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, except that the tandem SAR may be exercised only with respect to the shares for which its related Option is then exercisable. 
 8.2
Payment of SAR Amount 
 Upon the exercise of an SAR, a Participant shall be entitled to receive payment from the Company in an amount determined by
multiplying (a) the difference between the Fair Market Value of the Common Stock for the date of exercise over the grant price by (b) the number of shares with respect to which the SAR is exercised. At the discretion of the Committee, the
payment upon exercise of an SAR may be in cash, in shares of equivalent value, in some combination thereof or in any other manner approved by the Committee in its sole discretion. 
 8.3 Post-Termination Exercise 
 The Committee shall establish and set forth in each instrument that evidences a
freestanding SAR whether the SAR shall continue to be exercisable, and the terms and conditions of such exercise, after a Termination of Service, any of which provisions may be waived or modified by the Committee at any time, provided that any such
waiver or modification shall satisfy the requirements for exemption under Section 409A. 
 Section 9. Restricted Stock and
Stock Units 
 9.1 Grant of Restricted Stock and Stock Units 
 The Committee may grant Restricted Stock and Stock Units on such terms and conditions and subject to such forfeiture restrictions, if any (which may be based on continuous service with the Company or a Related Company or the achievement of
any of the Performance Criteria set forth in Section 11.2), as the Committee shall determine in its sole discretion, which terms, conditions and restrictions shall be set forth in the instrument evidencing the Award. 
 9.2 Issuance of Shares 
 Upon the satisfaction of any terms,
conditions and restrictions prescribed with respect to Restricted Stock or Stock Units, or upon a Participant’s release from any terms, conditions and restrictions of Restricted Stock or Stock Units, as determined by the Committee, and subject
to the provisions of Section 13, (a) the shares of Restricted Stock covered by each Award of Restricted Stock shall become freely transferable by the Participant, and (b) Stock Units shall be paid in cash, shares of Common Stock or a
combination of cash and shares of Common Stock as the Committee shall determine in its sole discretion. Any fractional shares subject to such Awards shall be paid to the Participant in cash. 
 9.3 Waiver of Restrictions 
 Notwithstanding any other provisions of
the Plan, the Committee, in its sole discretion, may waive the repurchase or forfeiture period and any other terms, conditions or restrictions on any Restricted Stock or Stock Unit under such circumstances and subject to such terms and conditions as
the Committee shall deem appropriate; provided, however, that the Committee may not adjust performance goals for any Restricted Stock or Stock Unit intended to be exempt under Section 162(m) for the year in which the Restricted Stock or Stock
Unit is settled in such a manner as would increase the amount of compensation otherwise payable to a Participant. 
 Section 10. Performance Shares and Performance Units 
 10.1 Grant of Performance Shares 
 The Committee may grant Awards of performance shares (“Performance Shares”) and designate the Participants to whom Performance Shares are to be awarded and
determine the number of Performance Shares, the length of the Performance Period and the other terms and conditions of each such Award. Each Award of Performance Shares shall entitle the Participant to a payment in 

  

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the form of shares of Common Stock upon the attainment of performance goals and other terms and conditions specified by the Committee. Notwithstanding
satisfaction of any performance goals, the number of shares issued under an Award of Performance Shares may be adjusted on the basis of such further consideration as the Committee shall determine in its sole discretion. The Committee, in its sole
discretion, may make a cash payment equal to the Fair Market Value of the Common Stock otherwise required to be issued to a Participant pursuant to an Award of Performance Shares. It is generally expected that the Committee will exercise its
discretion to make cash settlements of Awards of Performance Shares only with respect to Awards granted to Participants in countries other than the United States. 
 10.2 Grant of Performance Units 
 The Committee may grant Awards of performance units (“Performance Units”) and designate the
Participants to whom Performance Units are to be awarded and determine the number of Performance Units and the terms and conditions of each such Award. Performance Units shall entitle the Participant to a payment in cash upon the attainment of
performance goals and other terms and conditions specified by the Committee, provided that the performance period for any Performance Unit Award shall be at least one year. Notwithstanding the satisfaction of any performance goals, the amount to be
paid under an Award of Performance Units may be adjusted on the basis of such further consideration as the Committee shall determine in its sole discretion. The Committee, in its sole discretion, may substitute actual shares of Common Stock for the
cash payment otherwise required to be made to a Participant pursuant to a Performance Unit. 
 Section 11. Section 162(m) Awards

 11.1 Terms of Section 162(m) Awards Generally 
 In addition to any other Awards under the Plan, the Committee may, at the time of grant of an Award (other than an Option or a Stock Appreciation Right) to a Participant who is then a Covered Employee or is likely to be a Covered Employee
as of the end of the tax year in which the Company would claim a tax deduction in connection with such Award, specify that all or any portion of such Award is intended to satisfy the requirements for qualified performance-based compensation under
Section 162(m). With respect to each such Award, the Committee shall establish, in writing, that the vesting and/or payment pursuant to the Award shall be conditioned on the attainment for the specified Performance Period of specified
performance targets related to designated performance goals for such period selected by the Committee from among the Performance Criteria specified in Section 11.2. Such action shall be taken no later than the earlier of (a) the date 90
days after the commencement of the applicable Performance Period or (b) the date on which 25% of the Performance Period has elapsed and, in any event, at a time when the outcome of the performance goals remain substantially uncertain.

 11.2 Performance Criteria 
 For purposes of this
Section 11, the term “Performance Criteria” shall mean any one or more of the following performance criteria: profits (including, but not limited to, profit growth, net operating profit or economic profit); profit-related return
ratios; return measures (including, but not limited to, return on assets, capital, equity or sales); cash flow (including, but not limited to, operating cash flow, free cash flow or cash flow return on capital); earnings (including, but not limited
to, net earnings, earnings per share, or earnings before or after taxes); net sales growth; net income (before or after taxes, interest, depreciation and/or amortization); gross or operating margins; productivity ratios; share price (including, but
not limited to, growth measures and total shareholder return); expense targets; margins; operating efficiency; customer satisfaction; and working capital targets. 
 11.3 Use and Calculation of Performance Criteria 
 Any Performance Criteria may be used to measure the performance of the Company as a whole
or with respect to one or more business units, divisions, acquired businesses, minority investments, partnerships or joint ventures. Performance Criteria may be stated in absolute terms or relative to comparison companies or indices to be achieved
during a period of time. Performance Criteria shall be calculated in accordance with the Company’s financial statements or generally accepted accounting principles, or under a methodology established by the Committee prior to the issuance of an
Award that is consistently applied and identified in the audited financial statements, including footnotes, or the Management’s Discussion and Analysis section of the Company’s Annual Report on Form 10-K. The Committee shall have the right
to specify, at the time the performance goals are established in accordance with this Section 11, that any Performance Criteria may be adjusted to exclude the impact of any Nonrecurring Item, provided that such Nonrecurring Item may be
identified in the audited financial statements, including footnotes, or the Management’s Discussion and Analysis section of the Company’s Annual Report on Form 10-K. 
  

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 11.4 Committee Certification and Authority 
 After the completion of each Performance Period, the Committee shall certify the extent to which any Performance Criteria has been satisfied, and the amount payable as a result thereof, prior to payment, settlement or
vesting of any Award subject to this Section 11. Notwithstanding any provision of the Plan other than Section 11, with respect to any Award subject to this Section 11, the Committee may adjust downwards, but not upwards, the amount
payable pursuant to such Award. 
 The Committee shall have the power to impose such other restrictions on Awards subject to this Section 11 as it may
deem necessary or appropriate to ensure that such Awards satisfy all requirements for “performance-based compensation” within the meaning of Section 162(m). 
 11.5 Maximum Awards 
 Subject to adjustment as provided in Section 15, and in accordance with the requirements
under Section 162(m), no Participant shall receive in any one calendar year grants of Awards that are intended to qualify as performance-based compensation under Section 162(m), other than Options, Stock Appreciation Rights or Performance
Units, covering an aggregate of more than 1 million shares of Common Stock. 
 In accordance with the requirements under Section 162(m), the
maximum aggregate dollar amount paid to an individual Participant in any one calendar year pursuant to a Performance Unit or other cash-based Award that is intended to qualify as performance-based compensation under Section 162(m) shall not
exceed (i) 0.50% of the cumulative Adjusted Operating Cash Flow for the specific Performance Period for which the Award is granted for a Participant who is the Company’s Chief Executive Officer and (ii) 0.20% of the cumulative
Adjusted Operating Cash Flow for the specific Performance Period for which the Award is granted for any other Participant. 
 11.6 Options and SARs 

 Subject to adjustment as provided in Section 15, and in accordance with the requirements under Section 162(m), no Participant shall receive in
any one calendar year grants of Options or Stock Appreciation Rights covering an aggregate of more than 2 million shares of Common Stock. Notwithstanding any other provision of the Plan to the contrary, any Option or Stock Appreciation Right
intended to qualify as performance-based compensation under Section 162(m) shall have an exercise or grant price, as applicable, of no less than 100% of the Fair Market Value of the Common Stock for the Grant Date, except in the case of
Substitute Awards. 
 Section 12. Other Stock or Cash-Based Awards 
 In addition to the Awards described in Sections 7 through 10, and subject to the terms of the Plan, the Committee may grant other incentives payable in cash or in shares
of Common Stock under the Plan as it determines to be in the best interests of the Company and subject to such other terms and conditions as it deems appropriate. 
 Section 13. Withholding 
 The Company may require a Participant to pay to the Company the amount of
(a) any taxes that the Company is required by applicable federal, state, local or foreign law to withhold with respect to the grant, vesting or exercise of an Award (“tax withholding obligations”) and (b) any amounts due from the
Participant to the Company or to any Related Company (“other obligations”). The Company shall not be required to issue any shares of Common Stock under the Plan until such tax withholding obligations and other obligations are satisfied.

 The Committee may permit or require a Participant to satisfy all or part of his or her tax withholding obligations and other obligations by
(a) paying cash to the Company, (b) having the Company withhold an amount from any cash amounts otherwise due or to become due from the Company to the Participant, (c) having the Company withhold a number of shares of Common Stock
that would otherwise be issued to the Participant (or become vested in the case of Restricted Stock) having a Fair Market Value equal to the tax withholding obligations and other obligations, or (d) surrendering a number of shares of Common
Stock the Participant already owns having a value equal to the tax withholding obligations and other obligations. 
  

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 Section 14. Assignability 
 No Award or interest in an Award may be sold, assigned, pledged (as collateral for a loan or as security for the performance of an obligation or for any other purpose) or transferred by the Participant or made subject
to attachment or similar proceedings otherwise than by will or by the applicable laws of descent and distribution, except that to the extent permitted by the Committee, in its sole discretion, a Participant may designate one or more beneficiaries on
a Company-approved form who may receive payment under an Award after the Participant’s death. During a Participant’s lifetime, an Award may be exercised only by the Participant. 
 Section 15. Adjustments 
 In the event, at any time or from time to time, a stock
dividend, stock split, spin-off, combination or exchange of shares, recapitalization, merger, consolidation, distribution to shareholders other than a normal cash dividend or other change in the Company’s corporate or capital structure results
in (a) the outstanding shares of Common Stock, or any securities exchanged therefor or received in their place, being exchanged for a different number or kind of securities of the Company or of any other company or (b) new, different or
additional securities of the Company or of any other company being received by the holders of shares of Common Stock, then the Committee shall make proportional adjustments in (i) the maximum number and kind of securities available for issuance
under the Plan; (ii) the maximum number and kind of securities issuable as Incentive Stock Options as set forth in Section 4.2; (iii) the maximum number and kind of securities that may be issued to an individual in any one calendar
year as set forth in Section 4.3; (iv) the maximum number and kind of securities that may be made subject to the different types of Awards available under the Plan; and (v) the number and kind of securities that are subject to any
outstanding Award and the per share price of such securities, without any change in the aggregate price to be paid therefor. 
 The determination by the
Committee as to the terms of any of the foregoing adjustments shall be conclusive and binding. 
 Notwithstanding the foregoing, the issuance by the Company
of shares of stock of any class, or securities convertible into shares of stock of any class, for cash or property, or for labor or services rendered, either upon direct sale or upon the exercise of rights or warrants to subscribe therefor, or upon
conversion of shares or obligations of the Company convertible into such shares or other securities, shall not affect, and no adjustment by reason thereof shall be made with respect to, outstanding Awards. 
 Section 16. Amendment and Termination 
 16.1 Amendment, Suspension or Termination of the Plan 
 The Board or the Committee may amend, suspend or terminate the Plan or any portion of
the Plan at any time and in such respects as it shall deem advisable; provided, however, that, to the extent required by applicable law, regulation or stock exchange rule, shareholder approval shall be required for any amendment to the Plan.

 Notwithstanding the foregoing, an amendment that constitutes a “material revision,” as defined by the rules of the New York Stock Exchange shall
be submitted to the Company’s shareholders for approval. In addition, any revision that deletes or limits the scope of the provisions in Section 7.2 prohibiting repricing of options without shareholder approval and any revision that
increases the number of shares stated in Section 4.1 as available for issuance under the Plan shall be considered material revisions that require shareholder approval. 
 16.2 Term of the Plan 
 Unless sooner terminated as provided herein, the Plan shall terminate ten years from the
Effective Date. After the Plan is terminated, no future Awards may be granted, but Awards previously granted shall remain outstanding in accordance with their applicable terms and conditions and the Plan’s terms and conditions. Notwithstanding
the foregoing, no Incentive Stock Options may be granted more than ten years after the earlier of (a) the adoption of the Plan by the Board and (b) the Effective Date. 
 16.3 Consent of Participant 
 The amendment, suspension or termination of the Plan or a portion thereof or the
amendment of an outstanding Award shall not, without the Participant’s consent, materially adversely affect any rights under any Award theretofore granted to the Participant under 

  

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the Plan. Any change or adjustment to an outstanding Incentive Stock Option shall not, without the consent of the Participant, be made in a manner so as to
constitute a “modification” that would cause such Incentive Stock Option to fail to continue to qualify as an Incentive Stock Option. Notwithstanding the foregoing, any adjustments made pursuant to Section 15 shall not be subject to
these restrictions. 
 Section 17. General 
 17.1 Clawback Policy 
 The Board shall, in all appropriate circumstances, require reimbursement of any annual
incentive payment or long-term incentive payment under any Award to an executive officer where: (1) the payment was predicated upon achieving certain financial results that were subsequently the subject of a substantial restatement of Company
financial statements filed with the Securities and Exchange Commission; (2) the Board determines the executive engaged in intentional misconduct that caused or substantially caused the need for the substantial restatement; and (3) a lower
payment would have been made to the executive based upon the restated financial results. In each such instance, the Company will, to the extent practicable, seek to recover from the individual executive the amount by which the individual
executive’s incentive payments for the relevant period exceeded the lower payment that would have been made based on the restated financial results. For purposes of this policy, the term “executive officer” means any officer who has
been designated an executive officer by the Board. 
 17.2 No Individual Rights 
 No individual or Participant shall have any claim to be granted any Award under the Plan, and the Company has no obligation for uniformity of treatment of Participants under the Plan. 
 Furthermore, nothing in the Plan or any Award granted under the Plan shall be deemed to constitute an employment contract or confer or be deemed to confer on any
Participant any right to continue in the employ of, or to continue any other relationship with, the Company or any Related Company or limit in any way the right of the Company or any Related Company to terminate a Participant’s employment or
other relationship at any time, with or without cause. 
 17.3 Issuance of Shares 
 Notwithstanding any other provision of the Plan, the Company shall have no obligation to issue or deliver any shares of Common Stock under the Plan or make any other distribution of benefits under the Plan unless, in
the opinion of the Company’s counsel, such issuance, delivery or distribution would comply with all applicable laws (including, without limitation, the requirements of the Securities Act or the laws of any state or foreign jurisdiction) and the
applicable requirements of any securities exchange or similar entity. 
 The Company shall be under no obligation to any Participant to register for offering
or resale or to qualify for exemption under the Securities Act, or to register or qualify under the laws of any state or foreign jurisdiction, any shares of Common Stock, security or interest in a security paid or issued under, or created by, the
Plan, or to continue in effect any such registrations or qualifications if made. The Company may issue certificates for shares with such legends and subject to such restrictions on transfer and stop-transfer instructions as counsel for the Company
deems necessary or desirable for compliance by the Company with federal, state and foreign securities laws. The Company may also require such other action or agreement by the Participants as may from time to time be necessary to comply with
applicable securities laws. 
 To the extent the Plan or any instrument evidencing an Award provides for issuance of stock certificates to reflect the
issuance of shares of Common Stock, the issuance may be effected on a noncertificated basis, to the extent not prohibited by applicable law or the applicable rules of any stock exchange. 
 17.4 Indemnification 
 Each person who is or shall have been a member of the Board, or a committee appointed by the
Board, or an officer of the Company to whom authority was delegated in accordance with Section 3 shall be indemnified and held harmless by the Company against and from 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 

  

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reason of any action taken or failure to act under the Plan and against and 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, however, that 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, unless such loss, cost, liability or expense is a result of his or her own willful misconduct or except as expressly provided by statute. 

The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company’s
certificate of incorporation or bylaws, as a matter of law, or otherwise, or of any power that the Company may have to indemnify them or hold them harmless. 
 17.5 No Rights as a Shareholder 
 Unless otherwise provided by the Committee or in the instrument evidencing the Award or in a written
employment or services agreement, no Option or Award denominated in units shall entitle the Participant to any cash dividend, voting or other right of a shareholder unless and until the date of issuance under the Plan of the shares that are the
subject of such Award. 
 17.6 Compliance With Laws and Regulations 
 Notwithstanding anything in the Plan to the contrary, the Committee, in its sole discretion, may bifurcate the Plan so as to restrict, limit or condition the use of any provision of the Plan to Participants who are
officers or directors subject to Section 16 of the Exchange Act without so restricting, limiting or conditioning the Plan with respect to other Participants. 
 Additionally, in interpreting and applying the provisions of the Plan, any Option granted as an Incentive Stock Option pursuant to the Plan shall, to the extent permitted by law, be construed as an “incentive stock option” within
the meaning of Code Section 422. 
 Additionally, notwithstanding anything contained in the Plan to the contrary, it is the Company’s intention
that any and all Awards and compensation payable under the Plan shall satisfy the requirements for exemption under Section 409A and that all terms and provisions shall be interpreted to satisfy such requirements. If the Committee determines
that an Award, payment, distribution, deferral election, transaction or any other action or arrangement contemplated by the provisions of the Plan would, if undertaken, cause a Participant to become subject to Section 409A, the Committee, to
the extent it deems necessary or advisable in its sole discretion, reserves the right , but shall not be required, to unilaterally amend or modify the Plan and any Award granted under the Plan so that the Award qualifies for exemption from or
compliance with Section 409A. Awards not deferred under Section 6.3 and not otherwise exempt from the requirements of Section 409A are intended to qualify for the short-term deferral exemption to Section 409A, and payment shall
be made as soon as administratively feasible after the Award became vested, but in no event shall such payment be made later than 2-1/2 months after the end of the calendar year in which the Award became vested unless otherwise permitted under the
exemption provisions of Section 409A. 
 17.7 Participants in Other Countries 
 The Committee shall have the authority to adopt such modifications, procedures and subplans as may be necessary or desirable to comply with provisions of the laws of other countries in which the Company or any Related
Company may operate to ensure the viability of the benefits from Awards granted to Participants employed in such countries, to comply with applicable foreign laws and to meet the objectives of the Plan. 
 Notwithstanding the provisions of Sections 7.2 and 8.1, where applicable foreign law requires that compensatory stock right be priced based upon a specific price
averaging method and period, a stock right granted in accordance with such applicable foreign law will be treated as meeting the requirements of Sections 7.2 or 8.1, provided that the averaging period does not exceed 30 days. 
 17.8 No Trust or Fund 
 The Plan is intended to constitute an
“unfunded” plan. Nothing contained herein shall require the Company to segregate any monies or other property, or shares of Common Stock, or to create any trusts, or to make any special deposits for any immediate or deferred amounts
payable to any Participant, and no Participant shall have any rights that are greater than those of a general unsecured creditor of the Company. 
  

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 17.9 Successors 
 All
obligations of the Company under the Plan with respect to Awards 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 the business and/or assets of the Company. 
 17.10 Severability 
 If any provision of the Plan or any Award is determined to be invalid, illegal or unenforceable in any jurisdiction, or as to any person, or would disqualify the Plan or any Award under any law deemed applicable by
the Committee, such provision shall be construed or deemed amended to conform to applicable laws, or, if it cannot be so construed or deemed amended without, in the Committee’s determination, materially altering the intent of the Plan or the
Award, such provision shall be stricken as to such jurisdiction, person or Award, and the remainder of the Plan and any such Award shall remain in full force and effect. 
 17.11 Choice of Law 
 The Plan, all Awards granted thereunder and all determinations made and actions taken pursuant
thereto, to the extent not otherwise governed by the laws of the United States, shall be governed by the laws of the State of Illinois without giving effect to principles of conflicts of law. 
 Section 18. Effective Date 
 The Plan is amended and restated effective
January 1, 2008 (the “Effective Date”). 
  

 Page 131997 Incentive Stock Plan

 Exhibit 10.5 
 The Boeing Company 1997 Incentive Stock Plan 
 (as Amended Effective May 1, 2000 and as further
amended effective January 1, 2008) 
 1. Purpose 
 The purpose of this 1997 Incentive Stock Plan (the “Plan”) is to attract, retain and motivate key employees, officers, consultants, agents, advisors and independent contractors of The Boeing Company (the
“Company”) by providing them the opportunity to acquire a proprietary interest in the Company and to link their interests and efforts to the long-term interests of the Company’s shareholders. 
 2. Plan Administration 
 2.1 The Compensation Committee

 The Plan shall be administered by the Compensation Committee (the “Committee”) of the Company’s Board of Directors (the
“Board”). Except for the terms and conditions explicitly set forth in the Plan, the Committee shall have the authority, in its sole discretion, to determine all matters relating to awards under the Plan, including selection of the
individuals to be granted awards, the type of awards granted, the number of shares of the Company’s common stock (the “Common Stock”) subject to an award, all terms, conditions, restrictions and limitations, if any, of an award, and
the terms of any award agreement or notice. 
 2.2 Other Plans 
 The Committee shall also have authority to grant awards as an alternative to or as the form of payment for grants or rights earned or due under other compensation plans or arrangements of the Company, including the plan of any entity
acquired by the Company. 
 2.3 Delegation to Stock Plan Committee 
 Except for the power to amend the Plan as provided in Section 12, the Board or the Committee, in its sole discretion, may delegate the Committee’s authority and duties under the Plan to the Stock Plan
Committee of the Board or to such other committee appointed by the Board consisting of one or more senior executive officers of the Company who are also members of the Board, under such conditions and limitations as the Board or the Committee may
from time to time establish, except that only the Committee may make any determinations regarding awards to participants who are subject to Section 16 of the Securities Exchange Act of 1934, as amended (the “1934 Act”). 
 2.4 Finality of Committee Determinations 
 All decisions made by the
Committee or its delegate pursuant to the provisions of the Plan and all determinations and selections made by the Committee or its delegate pursuant to such provisions and related orders or resolutions of the Board shall be final and conclusive.

  

 1 

 3. Eligibility 
 Awards may be granted under the Plan to those officers and employees of the Company as the Committee, the Board or a delegate designated in accordance with Section 2.3 from time to time selects. Awards may also be made to consultants,
agents, advisors and independent contractors who provide services to the Company. Individuals who are not employees of the Company may not be granted Incentive Stock Options (as defined in Section 6.2). For purposes of this Section 3, the
“Company,” with respect to all awards under the Plan other than Incentive Stock Options, includes any entity that is directly or indirectly controlled by the Company or any entity in which the Company has a significant equity interest, as
determined by the Committee. With respect to Incentive Stock Options, the “Company” includes any parent or subsidiary of the Company in accordance with Section 422 of the Internal Revenue Code of 1986, as amended (the
“Code”). 
 4. Shares Subject to the Plan 
 4.1 Number and Source 
 The stock offered under the Plan shall be shares of Common Stock and may be unissued shares or shares now held or
subsequently acquired by the Company as treasury shares, as the Board, or a Board committee to which the Board may delegate such authority, may from time to time determine. Subject to adjustment as provided in Sections 4.3 and 5, the aggregate
number of shares that may be issued under the Plan shall not exceed sixty-one million (61,000,000). Subject to adjustment as provided in Sections 4.3 and 5, the aggregate number of shares that may be issued under awards granted pursuant to
Section 6.4 that are not subject to restrictions based on the achievement of specified performance goals shall not exceed six million (6,000,000). The aggregate number of shares that may be covered by awards granted to any one individual in any
one calendar year shall not exceed one million two hundred thousand (1,200,000). 
 4.2 Shares Available 
 Any shares subject to an award granted under the Plan that is forfeited, terminated or canceled or, in the case of awards granted under Section 6.4, any shares that
do not vest shall again be available for the granting of awards under the Plan. In instances where a stock appreciation right is settled in cash, the shares covered by such award shall remain available for the granting of other awards. Likewise, the
payment of cash dividends and dividend equivalents paid in cash in conjunction with outstanding awards shall not be counted against the shares available for issuance. 
 4.3 Acquisitions 
 The Board, in its sole discretion, may increase the aggregate number of shares of Common Stock to
be delivered under Section 4.1 by up to three million (3,000,000) shares in the event the Company acquires any other corporation or business entity and the Company agrees to assume the acquired entity’s obligations for outstanding
stock options or stock grant commitments or otherwise grants awards to individuals in connection with such acquisition. 
  

 2 

 5. Adjustment of Shares Available 
 The aggregate numbers and kind of shares available for awards under the Plan, the maximum number and kind of shares that may be subject to awards to any individual under the Plan, the number and kind of shares covered
by each outstanding award, and the exercise price per share (but not the total price) for stock options, stock appreciation rights or similar awards outstanding under the Plan shall all be proportionately adjusted for any increase or decrease in the
number of issued shares of Common Stock resulting from any split-up, combination or exchange of shares, consolidation, spin-off or recapitalization of shares or any like capital adjustment or the payment of any stock dividend. 
 6. Awards 
 6.1 Types of Awards 
 The Committee shall have the authority, in its sole discretion, to determine the type or types of awards to be granted under the Plan. Such awards may include, but are
not limited to, Incentive Stock Options, Nonqualified Stock Options (as defined in Section 6.2), stock appreciation rights or restricted stock awards. Such awards may be granted either alone, in addition to or in tandem with any other type of
award granted under the Plan. 
 6.2 Stock Options 
 The
Committee may grant stock options, designated as “Incentive Stock Options,” which comply with the provisions of Section 422 of the Code or any successor statutory provision, or “Nonqualified Stock Options.” The price at
which shares may be purchased upon exercise of a particular option shall be determined by the Committee but shall not be less than 100% of the Fair Market Value of such shares at the time such option is granted. For purposes of the Plan, “Fair
Market Value” as to a particular day equals the mean of the high and low per share trading prices for the Common Stock as reported for such day in The Wall Street Journal or such other source as the Committee deems reliable. The
Committee shall set the term of each stock option, but no Incentive Stock Option shall be exercisable more than 10 years after the date such option is granted and, to the extent the aggregate Fair Market Value (determined as of the date the option
is granted) of Common Stock with respect to which Incentive Stock Options granted to a particular individual become exercisable for the first time during any calendar year (under the Plan and all other stock option plans of the Company) exceeds
$100,000 (or such corresponding amount as may be set by the Code), such options shall be treated as Nonqualified Stock Options. 
 6.3 Stock Appreciation
Rights 
 The Committee may grant stock appreciation rights to individuals, either in tandem with stock options that have been or are granted under the
Plan or with respect to a number of shares on which an option is not granted. A stock appreciation right shall entitle the holder to receive, with respect to each share of stock as to which the right is exercised, payment in an amount equal to the
excess of the share’s Fair Market Value on the date the right is exercised over its Fair Market Value on the date the right was granted. Such payment may be made in cash or in shares of Common Stock valued at the Fair Market Value as of the
date of the surrender, or partly in cash and partly in shares of Common Stock, as determined by the Committee in its sole discretion. The Committee may establish a maximum appreciation value payable for stock appreciation rights. 
  

 3 

 6.4 Restricted Stock Awards 
 (a) The Committee may grant restricted stock awards under the Plan in Common Stock or denominated in units of Common Stock. The Committee, in its sole discretion, will make such awards subject to conditions and restrictions, as set forth in
the instrument evidencing the award, which may be based on continuous service with the Company or the attainment of certain performance goals related to profits, profit growth, profit-related return ratios, cash flow or shareholder returns, where
such goals may be stated in absolute terms or relative to comparison companies or indices to be achieved during a period of time. No more than three million (3,000,000) shares may be issued subject to restrictions based on continuous employment
or services for less than three years (except where employment or services are terminated because an individual dies, retires, is laid off or becomes disabled). 
 (b) The Committee may choose, at the time of granting an award or at any time thereafter up to the time of payment of the award, to include as part of such award an entitlement to receive dividends or dividend equivalents, subject to such
terms as the Committee may establish. All dividends or dividend equivalents that are not paid currently may, in the Committee’s sole discretion, accrue interest and be paid to the participant if, when and to the extent such award is paid.

 6.5 Payment; Deferral 
 Awards granted under the Plan
may be settled through cash payments, the delivery of Common Stock or the granting of awards or combinations thereof as the Committee shall determine. Any award settlement, including payment deferrals, may be subject to such conditions, restrictions
and contingencies as the Committee shall determine. The Committee may permit or require the deferral of any award payment, subject to such rules and procedures as it may establish, which may include provisions for the payment or crediting of
interest, or dividend equivalents, including converting such credits to deferred stock unit equivalents. Notwithstanding the forgoing, any deferral made under this Section 6.5 will be made under a deferred compensation plan of the Company or
pursuant to an employment agreement, either of which satisfies the requirements for exemption from or complies with Code Section 409A. 
 6.6.
Dividend Equivalents 
 The right to any dividends or dividend equivalents declared and paid on the number of shares underlying an option or a stock
appreciation right may not be contingent, directly or indirectly on the exercise of the option or stock appreciation right, and an award providing a right to dividends or dividend equivalents declared and paid on the number of shares underlying an
option or a stock appreciation right, the payment of which is not contingent upon, or otherwise payable on, the exercise of the option or stock appreciation right, must comply with or qualify for an exemption under Code Section 409A.

 7. Option Exercise 
 7.1 Employment or Service
Requirement 
 Each award agreement or notice for a stock option or stock appreciation right shall contain a provision that the option or right shall not
be exercisable unless the optionee remains in the Company’s employ or service at least 12 months after the granting of the option or right. 
 7.2
Precondition to Stock Issuance 
 No shares shall be delivered pursuant to the exercise of any stock option or stock appreciation right, in whole or in
part, until qualified for delivery under such securities laws and regulations as may be deemed 

  

 4 

 
by the Committee to be applicable thereto and until, in the case of the exercise of an option, payment in full of the option price thereof (in cash or stock
as provided in Section 7.4) is received by the Company. No holder of an option or stock appreciation right, or any legal representative, legatee or distributee shall be or be deemed to be a holder of any shares subject to such option or right
unless and until such shares are issued. 
 7.3 No Fractional Shares 
 No stock option may at any time be exercised with respect to a fractional share. No fractional share shall be issued in the event shares are issued pursuant to the exercise of a stock appreciation right; however, a
fractional stock appreciation right may be exercised for cash. 
 7.4 Form of Payment 
 An optionee may exercise a stock option using as the form of payment (a) cash or cash equivalent (b) stock-for-stock payment (as described in Section 7.5), (c) any combination of the above or
(d) such other means as the Committee may approve. 
 7.5 Stock for Stock 
 An optionee who owns Common Stock may use such shares, the value of which shall be determined as the Fair Market Value of such shares on the date the stock option is exercised, as a form of payment to exercise stock
options under the Plan. The Committee, in its sole discretion, may restrict or rescind this right by notice to optionees. A stock option may be exercised in such manner only by tendering (actually or by attestation) to the Company whole shares of
Common Stock having a Fair Market Value equal to or less than the exercise price. If an option is exercised by surrender of stock having a Fair Market Value less than the exercise price, the optionee must pay the difference in cash. 
 8. Transferability 
 The right of any award recipient to exercise an
award granted under the Plan shall, during such recipient’s lifetime, be exercisable only by such recipient, and shall not be assignable or transferable by such recipient other than by will or the laws of descent and distribution. 

9. Withholding Taxes; Other Deductions 
 The Company shall have the
right to deduct from any settlement of an award made under the Plan, including the delivery or vesting of shares, (a) an amount sufficient to cover withholding as required by law for any federal, state or local taxes and (b) any amounts
due from the recipient of such award to the Company or to any subsidiary of the Company or to take such other action as may be necessary to satisfy any such withholding or other obligations, including withholding from any other cash amounts due or
to become due from the Company to such recipient an amount equal to such taxes or obligations. 
 10. Termination of Employment or Services

 The terms and conditions under which an award may be exercised following termination of a participant’s employment or services with the Company
shall be determined by the Committee; provided, that if a participant’s employment or services terminate for any reason within 12 months of the grant date of a stock option or stock appreciation right, such option or right shall expire as of
the date of such termination of employment or services and the participant and the participant’s legal representative shall forfeit any and all rights pertaining to such award. 
  

 5 

 11. Term of the Plan 
 The Plan shall become effective as of May 1, 1997 and shall remain in full force and effect through April 30, 2007, unless sooner terminated by the Board. After the Plan is terminated, no future awards may be granted but awards
previously granted shall remain outstanding in accordance with their applicable terms and conditions and the Plan’s terms and conditions. 
 12. Plan
Amendment 
 The Committee or the Board may amend, suspend or terminate the Plan at any time; provided that no such amendment shall be made without the
approval of the Company’s shareholders (a) that would increase the number of shares available for issuance in accordance with Section 4 or (b) if such approval is required (i) to comply with Section 422 of the Code with
respect to Incentive Stock Options or (ii) for purposes of Section 162(m) of the Code. 
 13. Bifurcation of the Plan 
 Notwithstanding anything in the Plan to the contrary, the Board, in its sole discretion, may bifurcate the Plan so as to restrict, limit or condition the use of any
provision of the Plan to participants who are officers subject to Section 16 of the 1934 Act without so restricting, limiting or conditioning the Plan with respect to other participants. 
 14. Code Section 409A 
 Notwithstanding anything contained in the Plan to the contrary, it is the Company’s intention that any and all awards and compensation payable under the Plan shall satisfy the requirements for exemption under
Code Section 409A, and that all terms and provisions shall be interpreted to satisfy such requirements. If the Committee determines that an award, payment, distribution, deferral election, transaction or any other action or arrangement
contemplated by the provisions of the Plan would, if undertaken, cause an award recipient to become subject to Code Section 409A, the Committee, to the extent it deems necessary or advisable in its sole discretion, reserves the right , but
shall not be required, to unilaterally amend or modify the Plan and any Award granted under the Plan so that the Award qualified for an exemption from or compliance with Section 409A. Awards not deferred under Section 6.5 and not otherwise
exempt from the requirements of Code Section 409A are intended to qualify for the short-term deferral exemption to Code Section 409A, and payment shall be made as soon as administratively feasible after the award became vested, but in no
event shall such payment be made later than 2 1/2 months after the end of the calendar year in which the award
became vested unless otherwise permitted under the exemption provisions of Code Section 409A. 
  

 6

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