Document:

Exhibit 10.1

EXHIBIT 10.1

AMENDMENT NO. 1 TO THE BON-TON STORES, INC.

2009 OMNIBUS INCENTIVE PLAN

WHEREAS, The Bon-Ton Stores, Inc. (the “Company”) maintains The Bon-Ton Stores, Inc. 2009
Omnibus Incentive Plan (the “Plan”) pursuant to which eligible employees may be granted equity
based awards and options, some of which may be linked to the performance of the Company; and

WHEREAS, the Human Resources and Compensation Committee (the “Committee”) of the Company’s
board of directors (the “Board”) has adopted a Compensation Recovery Policy pursuant to which
compensation paid or provided to certain of the Company’s executives may be recovered in the event
it is determined that the payment of such compensation was based on financial statements of the
Company that were later determined to be incorrect and were, therefore, restated; and

WHEREAS, the Board is generally authorized to amend the Plan from time to time in such manner
as it may deem advisable pursuant to the provisions of Section 12 of the Plan, subject to the
approval of any such amendment by the shareholders of the Company in certain circumstances not
applicable here;

NOW, THEREFORE, the Plan is hereby amended effective as of November 22, 2010 as follows:

	 	1.	 	A new Section 23 is added at the end of the Plan, to read:

	 	23.	 	Compensation Recovery Policy.	 

In addition to, and not in limitation of, the Committee’s rights to
reduce any payments or benefits as are set forth under any other
provisions of the Plan, in the event of a restatement of the
Company’s financial statements, the Committee may take such actions
as are permitted under the terms of the Company’s Compensation
Recovery Policy (the “Policy”) and shall take any and all actions as
are required under the Policy, as such may be amended from time to
time.

As currently in effect, the Policy provides that the Committee may
determine that, as a result of a restatement of the Company’s
financial statements, an Executive Officer (as hereinafter defined)
received more incentive compensation than the Executive Officer
would have received absent the incorrect financial statements. In
such case, the Committee, in its discretion, may take such action as
it deems appropriate to address the impact of the restatement of
financial statements. Such action may include, to the extent
permitted under applicable law, directing the Company to recover
from Executive Officers Performance-Based Award earned or
distributed to Executive Officers based on the achievement of
performance targets, if the incorrect financial statements resulted in
an increase in a Performance-Based Award to such Executive Officers.

 

 

 

An “Executive Officer” for these purposes shall be any officer of
the Company who holds an office of executive vice president or
above.

The Committee shall have sole discretion (subject to a standard
of good faith) in determining (i) whether circumstances of the
restatement of financial statements warrant recoupment of a
Performance-Based Award under applicable law or this Policy, and
(ii) the amount of compensation that may be recovered from an
Executive Officer (the “Recoverable Compensation”). Notwithstanding
the foregoing, recoupment of a Performance-Based Award shall be
required if the Company is required to prepare an accounting
restatement due to its material noncompliance with any financial
reporting requirements under applicable law.

Recoverable Compensation will include the Performance-Based Award
earned or distributed (as applicable) during the period(s), not to
exceed 3 years, that required restatement of financial statements,
up to the amount of the Performance-Based Award that the Executive
Officer obtained as a result of financial statements that were later
restated.

In the discretion of the Committee, Recoverable Compensation may
include interest and expenses incurred by the Company to recoup a
Performance-Based Award under this Policy.

	 	2.	 	In all other respects, the Plan shall remain in full force and effect without change.

IN WITNESS WHEREOF, and as evidence of the adoption of this amendment to the Plan, the Board
of Directors has caused this document to be signed by a duly authorized officer this 22nd day of
November, 2010.

	 	 	 	 	 
	 	THE BON-TON STORES, INC.

 	 
	 	By:  	/s/ Keith E. Plowman
 	 
	 	 	Keith E. Plowman 	 
	 	 	Executive Vice President - Chief Financial

Officer and Principal Accounting

Officer 	 
	 

 

-2-Exhibit 10.2

EXHIBIT 10.2

THE BON-TON STORES, INC.

RESTRICTED STOCK AGREEMENT

PERFORMANCE SHARES

This Restricted Stock Agreement — Performance Shares dated as of
 _____ 

, 20
 _____ 

(“Agreement”), between The Bon-Ton Stores, Inc. (the “Company”) and
 _____ 

(the
“Grantee”).

1.    Definitions. As used herein:

(a)    “Committee” means the Human Resources and Compensation Committee of the
Board of Directors of the Company, or such other committee as may be designated by the Board
of Directors pursuant to the Plan.

(b)    “Date of Grant” means
 _____ 

, 20
 _____ 

, the date on which the Company
awarded the Restricted Stock (the “Award”).

(c)    “Forfeiture Date” means any date during the Restricted Period on which
Grantee’s employment with the Company or an Affiliate of the Company terminates for any
reason other than death or disability, within the meaning of subsection 22(e)(3) of the
Internal Revenue Code of 1986, as amended (the “Code”). For purposes of this Agreement,
“Affiliate” shall mean a corporation that is a parent corporation or a subsidiary
corporation with respect to the Company within the meaning of Section 424(e) or (f) of the
Code.

(d)    “Plan” means The Bon-Ton Stores, Inc. 2009 Omnibus Incentive Plan, as may
be amended from time to time.

(e)    “Restricted Period” with respect to any shares of Restricted Stock (as
hereinafter defined) means the period beginning on the Date of Grant and ending on the
Vesting Date for such shares.

(f)    “Vesting Date” means the date set as upon which the Restricted Stock shall
vest.

All other capitalized terms used herein shall have the meaning set forth in the Plan except to
the extent the context clearly requires otherwise. This Agreement is intended to be consistent
with the terms of the Plan and is subject in all regards to the terms of the Plan. All
determinations regarding the vesting of Restricted Stock hereunder shall be made by the Committee
consistent with the Plan’s provisions regarding performance-based compensation. In any case where
there is a conflict between the terms of this Agreement and the terms of the Plan, the conflict
shall be resolved in favor of the Plan.

2.    Grant of Restricted Stock. Subject to the terms and conditions set forth herein
and in the Plan, the Company grants to Grantee
 _____ 

(
 _____ 

) shares of the Company’s Common
Stock, par value $.01 (the “Restricted Stock”). The Restricted Stock is subject to vesting (or
forfeiture) on the basis of the achievement of certain performance goals established for the
Company’s 20
 _____ 

fiscal year (i.e., the fiscal year ending on
 _____ 

, 20
 _____ 

). Except as
otherwise provided herein, the Restricted Stock shall vest (or be forfeited) as follows:

 

 

 

20
 _____ Fiscal Year Performance Targets. The Restricted Stock shall become vested
or shall be forfeited as a result of the achievement or non-achievement of performance
targets for the selected performance metrics to be established for the Company’s 20
 _____ 

fiscal
year by the Committee. These performance targets shall be determined by the Committee
consistent with the Plan and in the normal course (i.e., in the first quarter of the
Company’s 20
 _____ 

fiscal year).

20
 _____ 

Fiscal Year Vesting Date. The Vesting Date with respect to the Restricted
Stock shall be as of
 _____ 

, 20
 _____ 

, subject to the Committee’s certification in writing
of its determination of the level of achievement of the performance goals established in
connection with the vesting of such shares of Restricted Stock (without regard to whether
Grantee has remained employed by the Company or an Affiliate of the Company after the
Vesting Date). Any portion of the Restricted Stock not vested as a result of such
determination shall be considered as having been forfeited as of
 _____ 

, 20_.

3.    Restrictions on Restricted Stock. Subject to the terms and conditions set forth
herein and in the Plan, Grantee shall not be permitted to sell, transfer, pledge or assign any
Restricted Stock during such shares’ Restricted Period.

4.    Lapse of Restrictions. Subject to the terms and conditions set forth herein and in
the Plan, the restrictions on Restricted Stock set forth in Paragraph 3 shall lapse on such shares’
Vesting Date; provided, however, that on such Vesting Date Grantee is, and has continuously
been, an employee of the Company or an Affiliate of the Company during such shares’ Restricted
Period or termination of employment was due to death or disability.

5.    Forfeiture of Restricted Stock. Subject to the terms and conditions set forth
herein and in the Plan, if Grantee’s employment with the Company or an Affiliate of the Company
terminates during the Restricted Period for any reason other than death or disability, within the
meaning of the Code, Grantee shall forfeit any Restricted Stock still subject to restrictions as of
the Forfeiture Date. Upon a forfeiture of any shares of Restricted Stock as provided in this
Paragraph 5, the shares of Restricted Stock so forfeited shall be reacquired by the Company without
consideration.

6.    Rights of Grantee. Except for the restrictions set forth in Paragraph 3, during
the Restricted Period Grantee shall have all of the rights of a shareholder with respect to the
Restricted Stock, including the right to vote the Restricted Stock to the same extent that such
shares could be voted if they were not subject to the restrictions set forth in this Agreement.
However, cash dividends payable with respect to the Restricted Stock during the Restricted Period
shall not accrue or be paid to Grantee. Any extraordinary dividends or dividends that are in the
nature of a distribution of shares or are otherwise equivalent to a stock split, shall be subject
to the same restrictions as apply to the Restricted Stock with respect to which such extraordinary
dividends or shares were issued and shall be forfeited in accordance with Paragraph 5 unless the
restrictions lapse in accordance with Paragraph 4.

7.    Change of Control of the Company. In the event of a Change of Control, the
Committee may take whatever action with respect to the Restricted Stock it deems necessary or
desirable, including, without limitation, removing any restrictions or imposing any additional
restrictions on such Restricted Stock.

8.    Notices. Any notice to be given to the Company shall be addressed to the General
Counsel of the Company at its principal executive office, and any notice to be given to Grantee
shall be addressed to Grantee at the address then appearing on the personnel records of the Company
or the Affiliate of the Company by which he or she is employed, or at such other address as either
party hereafter may designate in writing to the other. Any such notice shall be deemed to have
been duly given when personally delivered, sent by recognized courier service, or by other
messenger, or when deposited in the United States
mail, addressed as aforesaid, registered or certified mail, and with proper postage and
registration or certification fees prepaid.

 

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9.    Securities Laws. The Committee may from time to time impose any conditions on the
Restricted Stock as it deems necessary or advisable to ensure that all rights granted under the
Plan satisfy the conditions of Rule 16b-3 promulgated pursuant to the Securities Exchange Act of
1934, as amended.

10.    Delivery of Shares. Upon a determination that the Restricted Stock has become
vested, the Company shall notify Grantee (or Grantee’s personal representative, heir or legatee in
the event of Grantee’s death) that the restrictions on the Restricted Stock have lapsed, and shall,
without payment from Grantee for such Restricted Stock, upon such Grantee’s request deliver a
certificate for such Restricted Stock without any legend or restrictions, except for such
restrictions as may be imposed by the Committee, in its sole judgment, under Paragraph 9, provided
that no certificates for shares will be delivered to Grantee (or to his or her personal
representative, heir or legatee) until appropriate arrangements have been made with the Company for
the withholding of any taxes which may be due with respect to such shares. The Company may
condition delivery of certificates for shares upon the prior receipt from Grantee of any
undertakings which it may determine are required to assure that the certificates are being issued
in compliance with federal and state securities laws. The right to payment of any fractional
shares shall be satisfied in cash, measured by the product of the fractional amount times the Fair
Market Value of a share on the Vesting Date.

11.    Status of Restricted Stock. The Restricted Stock is intended to constitute
property that is subject to a substantial risk of forfeiture during the Restricted Period, and
subject to federal income tax in accordance with section 83 of the Code. Section 83 generally
provides that Grantee will recognize compensation income with respect to the Restricted Stock on
such Restricted Stock’s Vesting Date in an amount equal to the then Fair Market Value of the shares
for which restrictions have lapsed. Alternatively, Grantee may elect, pursuant to Section 83(b) of
the Code, to recognize compensation income for all or any part of the Restricted Stock at the Date
of Grant in an amount equal to the Fair Market Value of the Restricted Stock subject to the
election on the Date of Grant. Such election must be made within 30 days of the Date of Grant and
Grantee shall immediately notify the Company if such an election is made. Grantee should consult
his or her tax advisors to determine whether a Section 83(b) election is appropriate.

12.    Administration. This Award has been granted pursuant to and is subject to the
terms and provisions of the Plan. All questions of interpretation and application of the Plan and
this Award shall be determined by the Committee. The Committee’s determination shall be final,
binding and conclusive.

13.    Award Not to Affect Employment. Nothing herein contained shall affect the right
of the Company or any Affiliate to terminate Grantee’s employment, services, responsibilities,
duties, or authority to represent the Company or any Affiliate at any time for any reason
whatsoever.

14.    Withholding of Taxes. Whenever the Company proposes or is required to deliver or
transfer shares in connection with this Award, the Company shall have the right to (a) require
Grantee to remit to the Company an amount sufficient to satisfy any federal, state and/or local
withholding tax requirements prior to the delivery or transfer of any certificate or certificates
for such shares or (b) take whatever action it deems necessary to protect its interest with respect
to tax liabilities.

15.    Compensation Recovery Policy. In addition to, and not in limitation of, the
Company’s rights under Paragraph 5, in the event of a restatement of the Company’s financial
statements, the Company may take action to recoup Restricted Stock earned or distributed in
accordance with the Company’s Compensation Recovery Policy.

 

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16.    Governing Law. The validity, performance, construction and effect of this
Agreement shall be governed by the laws of the Commonwealth of Pennsylvania, without giving effect
to principles of conflicts of law.

17.    Entire Agreement. This Agreement is intended by the parties as a final expression
of their agreement and intended to be a complete and exclusive statement of the agreement and
understanding of the parties hereto in respect of the subject matter herein. This Agreement
supersedes all prior agreements and understandings between the parties with respect to such subject
matter.

IN WITNESS WHEREOF, the parties, intending to be legally bound, have executed this Agreement
as of the day and year first above written.

	 	 	 	 	 
	 	THE BON-TON STORES, INC.

 	 
	 	By:  	______________________
 	 
	 	 	 	 
	 	 	Grantee: 

____________________ 	 
	 

 

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