Document:

Exhibit 10.1

 

INDEMNITY AGREEMENT

 

THIS AGREEMENT is made and entered into as of                     ,
20     by and between CUBIC CORPORATION,
a Delaware corporation (the “Corporation”), and [NAME][“Indemnitee”].

 

RECITALS

 

WHEREAS, Indemnitee has performed, and will continue to
perform, valuable services to the Corporation;

 

WHEREAS, the Corporation’s bylaws ( “Bylaws”) and Certificate
of Incorporation (“Certificate”) provide for the indemnification of the
directors, officers, employees and other agents of the Corporation, including
persons serving at the request of the Corporation in such capacities with other
corporations or enterprises, as authorized by the Delaware General Corporation
Law, as amended (the “Code”);

 

WHEREAS, the Bylaws, the Certificate and the Code permit contracts
between the Corporation and its directors, officers, employees and other agents
with respect to indemnification of such persons; and

 

WHEREAS, in order to induce Indemnitee to serve or continue
serving, and to further its own best interests, the Corporation is entering
into this Agreement.

 

NOW, THEREFORE, in consideration of Indemnitee’s continued service,
the parties agree as follows:

 

AGREEMENT

 

1. Services to the Corporation. Indemnitee will serve, at the will of
the Corporation, or under separate contract, if any, as [TITLE] faithfully and
to the best of his ability provided,
however, that Indemnitee may at any time and for any reason resign
from such position and provided, further, that the Corporation shall not,
solely by this Agreement, have any obligation to continue Indemnitee in any
position.

 

2. Indemnity. The Corporation shall hold harmless and indemnify Indemnitee
to the fullest extent authorized or permitted by the provisions of the Bylaws,
the Certificate, and the Code, as the same may be amended from time to time
(but, only to the extent that such amendment permits the Corporation to provide
broader indemnification rights than the Bylaws, the Certificate or the Code
permitted prior to adoption of such amendment).

 

3. Additional Indemnity. In addition to and not in limitation of the
indemnification otherwise provided for herein, and subject only to the
exclusions set forth in Section 4 hereof, the Corporation hereby further
agrees to hold harmless and indemnify Indemnitee:

 

(a)        against any and all expenses (including
attorneys’ fees), witness fees, damages, judgments, fines and amounts paid in
settlement and any other amounts that Indemnitee becomes legally obligated to
pay because of any claim or claims made against or by him in connection with
any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, arbitral, administrative or investigative (including an action by or
in the right of the Corporation) to which Indemnitee is, was, or at any time
becomes a party, or is threatened to be made a party, by reason of the fact
that Indemnitee is or was serving in any position at the request of the
Corporation,  and

 

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(b)       as long as Indemnitee acted in good
faith and in a manner he reasonably believed to be in, or not opposed to, the
best interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful.

 

4. Limitations on Additional Indemnity. No indemnity pursuant to Sections 2 or 3
hereof shall be paid by the Corporation:

 

(a)       on account of Indemnitee’s conduct that
is established by a final judgment as knowingly fraudulent or deliberately
dishonest or that constituted willful misconduct;

 

(b)        on account of Indemnitee’s conduct that
is established by a final judgment as constituting a breach of his duty of
loyalty to the Corporation or resulting in any personal profit or advantage to
which he was not legally entitled;

 

(c)       for which payment is fully made to Indemnitee
under an insurance policy or under another indemnification provision;

 

(d)        if indemnification is not lawful (and,
in this respect, both the Corporation and Indemnitee have been advised that the
Securities and Exchange Commission believes that indemnification for
liabilities arising under the federal securities laws is against public policy
and is, therefore, unenforceable and that claims for indemnification should be submitted
to appropriate courts for adjudication);

 

(e)        in connection with any proceeding (or
part thereof) initiated by Indemnitee, or any proceeding by Indemnitee against
the Corporation or its directors, officers, employees or other agents, unless (i) such
indemnification is expressly required by law to be made, (ii) the
proceeding was authorized by the Board of Directors of the Corporation, (iii) such
indemnification is provided by the Corporation, in its sole discretion,
pursuant to the powers vested in the Corporation under the Code, or (iv) the
proceeding is initiated pursuant to Section 9 hereof, or

 

(f)        for
any claim, issue or matter as to which Indemnitee is adjudged to be liable to
the Corporation unless and only to the extent that the Delaware Court of
Chancery or a judge of the court in which the action or suit was brought shall
determine upon application that, despite the adjudication of liability, but in
view of all the circumstances of the case, Indemnitee is fairly and reasonably
entitled to indemnity for such expenses as the court deems proper.

 

5. Continuation of Indemnity. All agreements and obligations of the Corporation
contained herein shall continue during the period Indemnitee is or was serving
at the request of the Corporation and shall continue thereafter so long as Indemnitee
is potentially subject to any claim or threatened, pending or completed action,
suit or proceeding, whether civil, criminal, arbitral, administrative or
investigative, by reason of the fact that he was serving in any position at the
request of the Corporation.

 

6. Partial Indemnification. Indemnitee shall be entitled to indemnification by
the Corporation for such portion of the expenses (including attorneys’ fees),
witness fees, damages, judgments, fines and amounts paid in settlement and any
other amounts that he becomes legally obligated to pay in connection with any
action, suit or proceeding referred to in Sections 2 and 3 hereof even if not
entitled to indemnification for the total amount thereof, and the Corporation
shall indemnify him for the portion thereof to which he is entitled.

 

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7. Notification and Defense of Claim. Not later than 20 days after receipt by Indemnitee
of a first notice of a claim or the commencement of any action, suit or
proceeding, he shall, if an indemnification claim is to be made under this
Agreement, notify the Corporation of the matter and shall deliver to the
Corporation a written application to indemnify Indemnitee in accordance with
this Agreement; provided, however, that the omission to promptly notify the
Corporation will not relieve it from any liability except to the extent that it
was prejudiced thereby. With respect to any indemnification:

 

(a)        the Corporation shall defend and may
control the defense at its own expense;

 

(b)       except as otherwise provided below, the
Corporation shall assume the defense thereof with counsel reasonably
satisfactory to Indemnitee. Indemnitee shall have the right to employ separate
counsel in such matter at his own expense unless (i) the employment of
counsel by Indemnitee has been authorized by the Corporation, (ii) Indemnitee
shall have reasonably concluded, and so notified the Corporation, that there is
an actual conflict of interest between the Corporation and Indemnitee in the
conduct of the defense of such action or (iii) the Corporation shall not
in fact have seasonably employed counsel to assume the defense of such action,
in each of which cases the fees and expenses of Indemnitee’s separate counsel
shall be at the expense of the Corporation. The Corporation shall not be
entitled to assume the defense of any action, suit or proceeding brought by or
on behalf of the Corporation or as to which Indemnitee shall have made the
conclusion provided for in clause (ii) above; and

 

(c)        the Corporation shall not be liable to
indemnify Indemnitee for any amounts paid in settlement of any action or claim
effected without its prior written consent, which shall not be unreasonably
withheld. The Corporation shall be permitted to settle any action except that
it shall not settle any action or claim in any manner which would impose any
penalty or limitation on Indemnitee without his written consent, which may be
given or withheld in his reasonable discretion.

 

8. Expenses. The Corporation shall advance, prior to the final
disposition of any proceeding, promptly following request therefor, all
expenses incurred by Indemnitee in connection with such proceeding upon receipt
of an undertaking by him to repay said amounts if it shall be determined
ultimately that he is not entitled to be indemnified under the provisions of
this Agreement, the Bylaws, the Code, or otherwise.  This Section 8 shall not apply to any
claim made by Indemnitee for which indemnity is excluded pursuant to Section 4
hereof.

 

9. Enforcement. Any right to indemnification or advances granted by
this Agreement to Indemnitee shall be enforceable by him in any court of
competent jurisdiction if (i) the claim for indemnification or advances is
denied, in whole or in part, or (ii) no disposition of such claim is made
within ninety (90) days of request therefor. Indemnitee in such enforcement
action, if successful in whole or in part, shall be entitled to be paid also
the expense of prosecuting his claim.

 

10. Reserved.

 

11. Non-Exclusivity of Rights. The rights conferred on Indemnitee by this Agreement
shall not be exclusive of any other right which he may have or hereafter
acquire under the Code or any statute, provision of the Corporation’s
Certificate of Incorporation or Bylaws, agreement, vote of stockholders or
directors, or otherwise.

 

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12. Survival of Rights.

 

(a)        The rights conferred on Indemnitee by
this Agreement shall continue after he has ceased to be serving the Corporation
for acts taken or omitted to be taken during his service.

 

(b)       Any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business or assets of the Corporation or any of its
material subsidiaries for which Indemnitee shall have served, shall be deemed
to assume and agree to perform this Agreement in the same manner and to the
same extent that the Corporation would be required to perform if no such
succession had taken place.

 

13. Severability. Each of the provisions of this Agreement is a
separate and distinct agreement and independent of the others, so that if any
provision hereof shall be held to be invalid for any reason, such invalidity or
unenforceability shall not affect the validity or enforceability of the other
provisions hereof.

 

14. Governing Law. This Agreement shall be interpreted and enforced in
accordance with the laws of the State of Delaware.

 

15. Amendment and Termination. No amendment, modification, termination or cancellation
of this Agreement shall be effective unless in writing and signed by both
parties hereto.

 

16. Identical Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original
but all of which together shall constitute but one and the same Agreement. Only
one such counterpart need be produced to evidence the existence of this
Agreement.

 

17. Headings. The headings of the sections of this Agreement are
inserted for convenience only and shall not be deemed to constitute part of
this Agreement or to affect the construction hereof.

 

18. Notices. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given (i) upon delivery if delivered by hand to the party to whom
such communication was directed, or (ii) upon the third business day after
the date on which such communication was mailed if mailed by certified or
registered mail with postage prepaid, or if sent by electronic mail on the date
and time sent:

 

(a)        If to Indemnitee, at the address
indicated on the signature page hereof.

 

(b)        If to the Corporation, to:

 

CUBIC CORPORATION

 

Attn: Corporate
Secretary

 

9333 Balboa Avenue

 

San Diego, CA 92123

 

or to such other address
as may have been furnished to Indemnitee by the Corporation.

 

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IN
WITNESS WHEREOF,
the parties hereto have executed this Agreement on and as of the date and year
first above written.

 

	
   

  	
   

  
	
   

  	
  CUBIC
  CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  INDEMNITEE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
  e-mail:

  	
   

  
				

 

5Exhibit 10.1

 

RLI CORP.

LONG-TERM
INCENTIVE PLAN

 

1.                    Purpose.  The purpose of the RLI Corp. Long-Term
Incentive Plan (the “Plan”) is to promote the interests of the Company and its
shareholders by providing key personnel of the Company and its Affiliates with
an opportunity to acquire a proprietary interest in the Company and reward them
for achieving a high level of corporate performance and thereby develop a
stronger incentive to put forth maximum effort for the continued success and
growth of the Company and its Affiliates. 
In addition, the opportunity to acquire a proprietary interest in the
Company will aid in attracting and retaining key personnel of outstanding
ability.  The Plan is also intended to
provide Outside Directors with an opportunity to acquire a proprietary interest
in the Company, to compensate Outside Directors for their contribution to the
Company and to aid in attracting and retaining Outside Directors.  No further awards shall be made under the Company’s
Omnibus Stock Plan after the Effective Date of this Plan.

 

2.                    Definitions,
Gender and Number

 

2.1              Definitions.  The
capitalized terms used elsewhere in the Plan have the meanings set forth below.

 

(a)          “Affiliate” means any entity that is an “eligible
issuer” of Company Stock within the meaning of Section 409A of the Code.

 

(b)         “Agreement” means a written contract (i) consistent
with the terms of the Plan entered into between the Company or an Affiliate and
a Participant and (ii) containing the terms and conditions of an Award in
such form and not inconsistent with the Plan as the Committee shall approve
from time to time, together with all amendments thereto, which amendments may
be unilaterally made by the Company (with the approval of the Committee) unless
such amendments are deemed by the Committee to be materially adverse to the
Participant and not required as a matter of law.

 

(c)          “Award” or “Awards” means a grant made
under the Plan in the form of Restricted Stock, Options, Stock Appreciation
Rights, Performance Units, Stock or any other Stock-based award.

 

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

 

(e)          “Cause” means the Participant’s:  (i) failure to comply with any material
policies and procedures of the Company or Affiliate; (ii) conduct
reflecting dishonesty or disloyalty to the Company or Affiliate, or which may
have a negative impact on the reputation of the Company or Affiliate; (iii) commission
of a felony, theft or fraud, or violations of law involving moral turpitude; (iv) failure
to perform the material duties of his or her employment; (v) excessive
absenteeism; (vi) unethical behavior; or (vii) violation of a
material policy of the Company.  If a
Participant’s employment is terminated for “Cause,” the date on which the
Participant’s employment is considered to be terminated, for purposes hereof,
shall be the time at which such Participant is instructed or notified to cease
performing job responsibilities for the Company or any Affiliate, whether or
not for other reasons, such as payroll, benefits or compliance with legal
procedures or requirements, he or she may still have other attributes of an
employee.

 

(f)            “Code” means the Internal Revenue Code of
1986, as amended and in effect from time to time or any successor statute.

 

(g)         “Committee” means the Executive Resources
Committee of the Board, or any other committee of the Board consisting of two
or more Non-Employee Directors designated by the Board to administer the Plan
under Plan Section 3.1 and constituted so as to permit grants thereby to
comply with Exchange Act Rule 16b-3 and Code Section 162(m).

 

(h)         “Company” means RLI Corp., an Illinois
corporation, or any successor to all or substantially all of its businesses by
merger, consolidation, purchase of assets or otherwise.

 

 

(i)             “Covered Employee” has the meaning set
forth in Section 162(m) of the Code.

 

(j)             “Disabled” or “Disability,” with respect
to a Participant, means that the Participant satisfies the requirements to
receive long-term disability benefits under the Company-sponsored group
long-term disability plan in which the Participant participates without regard
to any waiting periods, or that the Participant has been determined by the
Social Security Administration to be eligible to receive Social Security
disability benefits.  A Participant shall
not be considered to be “Disabled” unless the Participant furnishes proof of
the Disability to the Company in such form and manner as the Company may
require.

 

(k)          “Effective Date” means the date specified
in Plan Section 12.1.

 

(l)             “Employee” means an employee (including
an officer or director who is also an employee) of the Company or an Affiliate.

 

(m)       “Exchange Act” means the Securities
Exchange Act of 1934, as amended and in effect from time to time or any
successor statute.

 

(n)         “Exchange Act Rule 16b-3” means Rule 16b-3
promulgated by the Securities and Exchange Commission under the Exchange Act,
as now in force and in effect from time to time or any successor regulation.

 

(o)         “Fair Market Value” as of any date means,
unless otherwise expressly provided in the Plan:

 

(i)                         the closing sale price of a Share on such
date, or on the next business day, if such date is not a business day, as
reflected on the NYSE or any other national securities exchange registered
under the Exchange Act on which the Shares are traded, or

 

(ii)                      if clause (i) is inapplicable, the
mean between the closing “bid” and the closing “asked” quotation of a Share on
the date immediately preceding that date, or, if no closing bid or asked
quotation is made on that date, on the next preceding day on which a closing
bid and asked quotation is made, on the over-the-counter market or any other
quotation system then in use, or

 

(iii)                   if clauses (i) and (ii) are inapplicable,
what the Committee determines in good faith to be 100% of the fair market value
of a Share on that date, using such criteria as it shall determine, in its sole
discretion, to be appropriate for valuation.

 

The determination of Fair Market Value shall be
subject to adjustment as provided in Plan Section 16.

 

(p)         “Full Value Award” means an Award other
than an Option, Stock Appreciation Right, or a Performance Unit payable solely
in cash.

 

(q)         “Fundamental Change” means a dissolution
or liquidation of the Company, a sale of substantially all of the assets of the
Company, a merger or consolidation of the Company with or into any other
corporation, regardless of whether the Company is the surviving corporation, or
a statutory share exchange involving capital stock of the Company.

 

(r)            “Insider,” as of a particular date means
any person who, as of that date is an officer of the Company as defined under
Exchange Act Rule 16a-1(f) or its successor provision.

 

(s)          “Non-Employee Director” means a member of
the Board who is considered a non-employee director within the meaning of Exchange
Act Rule 16b-3(b)(3) or its successor provision and an outside
director for purposes of Code Section 162(m).

 

(t)            “Option” means a right to purchase
Stock.  Only options that are
non-statutory options (i.e. options
that do not qualify for special tax treatment under Code Section 422) may
be issued under the Plan.

 

(u)         “Outside Director” means a director who
is not an Employee.

 

 

(v)         “Participant” means a person or entity to
whom an Award is or has been made in accordance with the Plan.

 

(w)       “Performance Cycle” means the period of
time as specified in an Agreement over which Performance Units are to be
earned.

 

(x)           “Performance Goals” means the performance
goals established by the Committee in connection with the grant of an
Award.  In the case of a grant of an
Award, other than an Option or Stock Appreciation Right, to a Covered Employee (i) the
Performance Goals shall be based on specified levels of one or more of the
following measures with respect to the performance of the Company or a group,
unit, Affiliate or an individual: 
specified levels of the Company’s stock price, market share, sales,
revenue, premiums, underwriting profit, market value potential, earnings per
share, return on equity, costs, cash flow, dividends paid, operating income,
return on assets, expense ratios, loss ratios or combined ratios, and (ii) shall
be set by the Committee within the time period prescribed by Code Section 162(m) and
related regulations.

 

(y)         “Performance Unit” means an Award made
pursuant to Plan Section 11.

 

(z)           “Plan” means this RLI Corp. Long-Term
Incentive Plan, as may be amended and in effect from time to time.

 

(aa)          “Restricted Stock” means an Award of
Stock granted under Plan Section 7 so long as such Stock remains subject
to the restrictions described in Section 7.

 

(bb)        “Retirement” means the retirement of a
Participant when the Participant’s age plus years of service equal at least 75.

 

(cc)          “Section 16” or “Section 16(b)”
means Section 16 or Section 16(b), respectively, of the Exchange Act
or any successor statute and the rules and regulations promulgated
thereunder as in effect and as amended from time to time.

 

(dd)        “Share” means a share of Stock.

 

(ee)          “Stock” means the common stock, par value
$1.00 per share, of the Company.

 

(ff)              “Stock Appreciation Right” means a right,
the value of which is determined in relation to the appreciation in value of
Shares pursuant to an Award granted under Plan Section 10.

 

(gg)        “Successor,” with respect to a
Participant, means the legal representative of an incompetent Participant, and
if the Participant is deceased, the estate of the Participant or the person or
persons who may, by bequest or inheritance, or pursuant to the terms of an
Award, acquire the right to exercise an Option or Stock Appreciation Right or to
receive cash and/or Shares issuable in satisfaction of an Award in the event of
the Participant’s death.

 

(hh)        “Term” means the period during which an
Option or Stock Appreciation Right may be exercised or the period during which
the restrictions or terms and conditions placed on Restricted Stock or any
other Award are in effect.

 

(ii)                “Transferee” means any member of the
Participant’s immediate family (i.e., his or
her children, step-children, grandchildren and spouse) or one or more trusts
for the benefit of such family members or partnerships in which such family
members are the only partners.

 

2.2         Gender and Number. 
Except when otherwise indicated by the context, reference to the
masculine gender shall include, when used, the feminine gender and any term
used in the singular shall also include the plural.

 

3.                    Administration
and Indemnification

 

3.1              Administration

 

(a)                The Committee shall administer the Plan.  The Committee shall have exclusive power to

 

 

(i) make Awards, (ii) determine
when and to whom Awards will be granted, the form of each Award, the amount of
each Award, and any other terms or conditions of each Award consistent with the
Plan, and (iii) determine whether, to what extent and under what
circumstances, Awards may be settled, paid or exercised in cash, Shares or
other Awards, or other property or canceled, forfeited or suspended.  Each Award shall be subject to an Agreement
authorized by the Committee.  A majority
of the members of the Committee shall constitute a quorum for any meeting of
the Committee, and acts of a majority of the members present at any meeting at
which a quorum is present or the acts unanimously approved in writing by all
members of the Committee shall be the acts of the Committee.  Notwithstanding the foregoing, the Board
shall have the sole and exclusive power to administer the Plan with respect to
Awards granted to Outside Directors.

 

(b)               Solely for purposes of determining and administering
Awards to Participants who are not Insiders, the Committee may delegate all or
any portion of its authority under the Plan to one or more persons who are not
Non-Employee Directors.

 

(c)                To the extent within its discretion and subject to
Plan Sections 15 and 16, other than price, the Committee may amend the
terms and conditions of any outstanding Award.

 

(d)               It is the intent that the Plan and all Awards granted
pursuant to it shall be administered by the Committee so as to permit the Plan
and Awards to comply with Exchange Act Rule 16b-3, except in such
instances as the Committee, in its discretion, may so provide.  If any provision of the Plan or of any Award
would otherwise frustrate or conflict with the intent expressed in this Section 3.1(d),
that provision to the extent possible shall be interpreted and deemed amended
in the manner determined by the Committee so as to avoid the conflict.  To the extent of any remaining irreconcilable
conflict with this intent, the provision shall be deemed void as applicable to
Insiders to the extent permitted by law and in the manner deemed advisable by
the Committee.

 

(e)          The Committee’s interpretation of the Plan and of any
Award or Agreement made under the Plan and all related decisions or resolutions
of the Board or Committee shall be final and binding on all parties with an
interest therein.  Consistent with its
terms, the Committee shall have the power to establish, amend or waive
regulations to administer the Plan.  In
carrying out any of its responsibilities, the Committee shall have
discretionary authority to construe the terms of the Plan and any Award or
Agreement made under the Plan.

 

3.2              Indemnification.  Each person
who is or shall have been a member of the Committee, or of the Board, and any
other person to whom the Committee delegates authority under the Plan, shall be
indemnified and held harmless by the Company, to the extent permitted by law,
against and from any loss, cost, liability or expense that may be imposed upon
or reasonably incurred by such person in connection with or resulting from any
claim, action, suit or proceeding to which such person may be a party or in
which such person may be involved by reason of any action taken or failure to
act, made in good faith, under the Plan and against and from any and all
amounts paid by such person in settlement thereof, with the Company’s approval,
or paid by such person in satisfaction of any judgment in any such action, suit
or proceeding against such person, provided such person shall give the Company
an opportunity, at the Company’s expense, to handle and defend the same before
such person undertakes to handle and defend it on such person’s own
behalf.  The foregoing right of
indemnification shall not be exclusive of any other rights of indemnification
to which such person or

 

 

persons may be entitled under the Company’s Articles
of Incorporation or By-Laws, as a matter of law, or otherwise, or any power
that the Company may have to indemnify them or hold them harmless.

 

4.                    Shares Available
Under the Plan; Other Plan Maximums

 

4.1.           Share Counting Rules

 

(a)          The number of Shares available for distribution under
the Plan shall not exceed 2,000,000 (subject to adjustment pursuant to Plan Section 16).

 

(b)         Any Shares subject to the terms and conditions of an
Award under the Plan that are not used because the terms and conditions of the
Award are not met may again be used for an Award under the Plan.

 

(c)          Any unexercised or undistributed portion of any
terminated, expired, exchanged, or forfeited Award, or any Award settled in
cash in lieu of Shares shall be available for further Awards.

 

(d)         For the purposes of computing the total number of
Shares granted under the Plan, the following rules shall apply to Awards
payable in Shares where appropriate:

 

(i)                   each Share that is subject to a Full Value Award shall
be counted as 2.5 Shares;

 

(ii)                each Option shall be deemed to be the equivalent of
the maximum number of Shares that may be issued upon exercise of the particular
Option;

 

(iii)             each Stock Appreciation Right shall be deemed to be
equivalent to the gross number of Shares with respect to which the Stock
Appreciation Right may be exercised;

 

(iv)            an Award (other than an Option) payable in some other
security shall be deemed to be equal to the number of Shares to which it
relates;

 

(v)               where the number of Shares available under the Award
is variable on the date it is granted, the number of Shares shall be deemed to
be the maximum number of Shares that could be received under that particular
Award;

 

(vi)            where two or more types of Awards (all of which are
payable in Shares) are granted to a Participant in tandem with each other, such
that the exercise of one type of Award with respect to a number of Shares
cancels at least an equal number of Shares of the other, each such joint Award
shall be deemed to be the equivalent of the maximum number of Shares available
under the largest single Award; and

 

(vii)         the following Shares shall not again be made available
for issuance as Awards under the Plan: (A) Shares that are exchanged by a
Participant or withheld by the Company as full or partial payment in connection
with any Award under the Plan; (B) any Shares withheld by the Company or
tendered by a Participant to satisfy the tax withholding obligations related to
any Award under the Plan; (C) Shares not issued or delivered as a result
of the net settlement of an outstanding Award; and, (D) Shares purchased
on the open market with any cash proceeds from the exercise of Stock Options.

 

Additional rules for determining the number of
Shares granted under the Plan may be made by the Committee as it deems
necessary or desirable.

 

 

(e)          No fractional Shares may be issued under the Plan;
however, cash shall be paid in lieu of any fractional Share in settlement of an
Award.

 

4.2.           Other Plan Maximums

 

(a)          The maximum number of Shares that may be awarded to a
Participant in any calendar year in the form of Options is 400,000 and the
maximum number of Shares that may be awarded to a Participant in any calendar
year in the form of Stock Appreciation Rights is 400,000.

 

(b)         The maximum number of Shares that may be awarded to a
Participant in any calendar year in the form of a Full Value Awards is 160,000.

 

(c)          The maximum dollar value that may be paid to a
Participant in any calendar year in Performance Units denominated in cash is
$7,500,000.

 

5.                    Eligibility. 
Participation in the Plan shall be limited to Employees and to certain
other individuals or entities who are not Employees but who provide services to
the Company or an Affiliate, such as services provided in the capacity of a
director.  The granting of Awards is
solely at the discretion of the Committee. 
References herein to “employed,” “employment” or similar terms (except “Employee”)
shall include the providing of services as a director.  Neither the transfer of employment of a
Participant between any of the Company or its Affiliates, nor a leave of
absence granted to such Participant and approved by the Committee, shall be
deemed a termination of employment for purposes of the Plan.

 

6.                    General Terms of
Awards

 

6.1               Amount and Conditions of Award. 
Each Agreement shall set forth the number of Shares of Restricted Stock,
Stock or Performance Units subject to the Agreement, or the number of Shares to
which the Option subject to the Agreement applies or with respect to which
payment upon the exercise of the Stock Appreciation Right subject to the
Agreement is to be determined, as the case may be, together with such other
terms and conditions applicable to the Award as determined by the Committee
acting in its sole discretion, which may include conditions on Options or Stock
Appreciation Rights becoming exercisable or the lapsing of restrictions on
Restricted Stock that are tied to Performance Goals.

 

6.2               Term.  Each
Agreement, other than those relating solely to Awards of Shares without
restrictions, shall set forth the Term of the Option, Stock Appreciation Right,
Restricted Stock or other Award or the Performance Cycle for the Performance
Units, as the case may be.  The maximum
Term for Options and Stock Appreciation Rights shall be ten years.  Acceleration of the expiration of the
applicable Term is permitted, upon such terms and conditions as shall be set
forth in the Agreement, which may, but need not, include, without limitation,
acceleration in the event of the Participant’s death, Disability or Retirement.  Acceleration of the Performance Cycle of
Performance Units shall be subject to Plan Section 11.2.

 

6.3               Transferability.  Except as
provided in this Section, during the lifetime of a Participant to whom an Award
is granted, only that Participant (or that Participant’s legal representative)
may exercise an Option or Stock Appreciation Right, or receive payment with
respect to Performance Units or any other Award.  No Award of Restricted Stock (before the
expiration of the restrictions), Options, Stock Appreciation Rights or
Performance Units or other Award may be sold, assigned, transferred, exchanged
or otherwise encumbered other than to a Successor in the event of a Participant’s
death or pursuant to a qualified domestic relations order as defined in the Code
or Title 1 of the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”), or the rules thereunder; any attempted transfer in
violation of this Section 6.3 shall

 

 

be of no effect. 
Notwithstanding the immediately preceding sentence, the Committee, in an
Agreement or otherwise at its discretion, may provide that the Award may be
transferable to a Transferee if the Participant does not receive any
consideration for the transfer.  Any
Award held by a Transferee shall continue to be subject to the same terms and
conditions that were applicable to that Award immediately before the transfer
thereof to the Transferee.  For purposes
of any provision of the Plan relating to notice to a Participant or to acceleration
or termination of an Award upon the death, Disability or termination of
employment of a Participant, the references to “Participant” shall mean the
original grantee of an Award and not any Transferee.

 

6.4               Termination of Employment. 
Except as otherwise determined by the Committee or provided by the
Committee in an Agreement, in case of a Participant’s termination of
employment, the following provisions shall apply:

 

(a)     Options and Stock Appreciation Rights

 

(i)                   If a Participant’s employment or other relationship
with the Company and its Affiliates terminates because of the Participant’s
death, then any Option or Stock Appreciation Right that has not expired or been
terminated shall become exercisable in full if the Participant’s employment or
other relationship with the Company and its Affiliates has been continuous
between the date the Option or Stock Appreciation Right was granted and a date
not more than three months prior to such death, and may be exercised by the
Participant’s Successor at any time, or from time to time, within one year
after the date of the Participant’s death.

 

(ii)                If a Participant’s employment or other relationship
with the Company and its Affiliates terminates because the Participant is
Disabled, then any Option or Stock Appreciation Right that has not expired or
been terminated shall become exercisable in full if the Participant’s
employment or other relationship with the Company and its Affiliates has been
continuous between the date the Option or Stock Appreciation Right was granted
and the date of such Disability, and the Participant or the Participant’s
Successor may exercise such Option or Stock Appreciation Right at any time, or
from time to time, within three years after the date of the Participant’s
Disability.

 

(iii)             If a Participant’s employment or other relationship
with the Company and its Affiliates terminates because of the Participant’s
Retirement, then any Option or Stock Appreciation Right that has not expired or
been terminated shall remain exercisable for three years after the Participant’s
Retirement, but, unless otherwise provided in the Agreement, only to the extent
that such Option or Stock Appreciation Right was exercisable immediately prior
to such Participant’s termination of employment; provided, however, that if the
Participant is an Outside Director, the Option or Stock Appreciation Right
shall remain exercisable until the expiration of the Term after such Outside
Director ceases to be a director of the Company, but, unless otherwise provided
in the Agreement, only to the extent that such Option or Stock Appreciation
Right was exercisable immediately prior to such Outside Director ceasing to be
a director.

 

(iv)            If a Participant’s employment terminates for any
reason other than death, Disability or Retirement, then any Option or Stock Appreciation
Right that has not expired or been terminated shall, unless the Committee shall
otherwise provide in

 

 

the Agreement, remain exercisable for three months
after termination of the Participant’s employment, but, unless otherwise
provided in the Agreement, only to the extent that such Option or Stock
Appreciation Right was exercisable immediately prior to such Participant’s
termination of employment; provided, however, that if the Participant is an
Outside Director, the Option or Stock Appreciation Right shall remain
exercisable until the expiration of the Term after such Outside Director ceases
to be a director of the Company, but, unless otherwise provided in the
Agreement, only to the extent that such Option or Stock Appreciation Right was
exercisable immediately prior to such Outside Director ceasing to be a
director.

 

(v)               Notwithstanding the foregoing Plan
Sections 6.4(a)(i), (ii), (iii) and (iv) in no event shall an
Option or a Stock Appreciation Right be exercisable after the expiration of the
Term of such Award or if the Participant’s employment (or service as a
director) is terminated due to “Cause.” 
Any Option or Stock Appreciation Right that is not exercised within the
periods set forth in Plan Sections 6.4 (i), (ii), (iii) and (iv) except
as otherwise provided by the Committee in the Agreement, shall terminate as of
the end of the periods described in such Sections.

 

(b)         Performance Units.  Payment for
Performance Units shall be made on March 1 immediately following the last
day of the Performance Cycle, subject to the following provisions of this Section 6.4(b).  Except as provided in this Section 6.4(b) or
in the Agreement, if a Participant’s employment or other relationship with the
Company and its Affiliates terminates during a Performance Cycle, then such
Participant shall not be entitled to any payment with respect to that
Performance Cycle.  However, if the
Participant dies or becomes Disabled during a Performance Cycle while still
employed by the Company or an Affiliate, or under other circumstances provided
by the Committee in its discretion in the Agreement or otherwise, the
Participant, unless the Committee shall otherwise provide in the Agreement,
shall be entitled to a payment with respect to Performance Units for the
Performance Cycle based upon the extent to which achievement of performance
targets was satisfied at the end of the Performance Cycle and prorated for the
portion of the Performance Cycle during which the Participant was employed by
the Company or its Affiliates.

 

(c)          Restricted Stock Awards.  If a
Participant’s employment or other relationship with the Company and its
Affiliates terminates during the Term of a Restricted Stock Award because of
the Participant’s death or Disability, or under other circumstances provided by
the Committee in its discretion in the Agreement or otherwise, consistent, in
the case of Covered Employees with Code Section 162(m), the Participant,
unless the Committee shall otherwise provide in the Agreement, shall be
entitled to receive a number of Shares of Restricted Stock under the Award that
has been prorated for the portion of the Term of the Award during which the
Participant was employed by the Company and its Affiliates, and, with respect
to such Shares, all restrictions shall lapse. 
Any Shares of Restricted Stock as to which restrictions do not lapse
under the preceding sentence or under the Agreement shall terminate at the date
of the Participant’s termination of employment and such Shares of Restricted
Stock shall be forfeited to the Company.

 

6.5           Rights as Shareholder.  Each
Agreement shall provide that a Participant shall have no rights as a
shareholder with respect to any securities covered by an Award unless and until
the date the Participant becomes the holder of record of the Stock, if any, to
which the Award relates.

 

 

7.                    Restricted Stock
Awards

 

(a)          An Award of Restricted Stock under the Plan shall
consist of Shares subject to restrictions on transfer and conditions of
forfeiture, which restrictions and conditions shall be included in the
applicable Agreement.  The Committee may
provide for the lapse or waiver of any such restriction or condition based on
such factors or criteria as the Committee, in its sole discretion, may
determine, subject, in the case of Covered Employees, to Code Section 162(m).

 

(b)         Except as otherwise provided in the applicable
Agreement, each Stock certificate issued with respect to an Award of Restricted
Stock shall either be deposited with the Company or its designee, together with
an assignment separate from the certificate, in blank, signed by the
Participant, or bear such legends with respect to the restricted nature of the
Restricted Stock evidenced thereby as shall be provided for in the applicable
Agreement.

 

(c)          The Agreement shall describe the terms and conditions
by which the restrictions and conditions of forfeiture upon awarded Restricted
Stock shall lapse.  Upon the lapse of the
restrictions and conditions, Shares free of restrictive legends, if any,
relating to such restrictions shall be issued to the Participant or a Successor
or Transferee.

 

(d)         A Participant or a Transferee with a Restricted Stock
Award shall have all the other rights of a shareholder including, but not
limited to, the right to receive dividends and the right to vote the Shares of
Restricted Stock.

 

8.                    Other Awards.  The Committee may from time to time grant
Stock and other Awards under the Plan including, without limitation, those
Awards pursuant to which Shares are or may in the future be acquired, Awards
denominated in Stock units, restricted Stock units, securities convertible into
Stock and phantom securities.  The
Committee, in its sole discretion, shall determine the terms and conditions of
such Awards provided that such Awards shall not be inconsistent with the terms
and purposes of the Plan.  The Committee
may, at its sole discretion, direct the Company to issue Shares subject to
restrictive legends and/or stop transfer instructions that are consistent with
the terms and conditions of the Award to which the Shares relate.

 

9.                    Stock Options

 

(a)          An Option shall be granted pursuant to an Agreement.
The purchase price of each Share subject to an Option shall be determined by
the Committee and set forth in the Agreement, but shall not be less than 100%
of the Fair Market Value of a Share as of the date the Option is granted
(except as provided in Plan Section 19).

 

(b)         The purchase price of the Shares with respect to which
an Option is exercised shall be payable in full at the time of exercise,
provided that to the extent permitted by law, the Agreement may permit some or
all Participants to simultaneously exercise Options and sell the Shares thereby
acquired pursuant to a brokerage or similar relationship and use the proceeds
from the sale as payment of the purchase price of the Shares.  The purchase price may be payable in cash, by
delivery or tender of Shares (by actual delivery or attestation) having a Fair
Market Value as of the date the Option is exercised equal to the purchase price
of the Shares being purchased pursuant to the Option, or a combination thereof,
as determined by the Committee, but no fractional Shares will be issued or
accepted.  In addition, the Committee may
provide that the Participant may instruct the Company to withhold a number of
Shares having a Fair Market Value (based on the Fair market Value of the Stock
on the date the applicable Option is exercised) equal to the product of (i) the

 

 

exercise price
multiplied by (ii) the number of Shares in respect of which the Option is
being exercised.  Provided, however, that
a Participant exercising an Option shall not be permitted to pay any portion of
the purchase price with Shares if, in the opinion of the Committee, payment in
such manner could have adverse financial accounting consequences for the
Company.

 

(c)          Each Option shall be exercisable in whole or in part
on the terms provided in the Agreement. 
In no event shall any Option be exercisable at any time after the
expiration of its Term.  When an Option
is no longer exercisable, it shall be deemed to have lapsed or terminated.

 

(d)         Upon receipt of notice of exercise, the Committee may
elect to cash out all or part of the portion of the Shares for which an Option
is being exercised by paying the Participant an amount, in cash or Shares,
equal to the excess of the Fair Market Value of the Shares over the aggregate
purchase price for the Shares for which the Option is being exercised on the
effective date of such cash-out.

 

10.              Stock
Appreciation Rights.  An Award of a
Stock Appreciation Right shall entitle the Participant (or a Successor or
Transferee), subject to terms and conditions determined by the Committee, to
receive upon exercise of the Stock Appreciation Right all or a portion of the
excess of (i) the Fair Market Value of a specified number of Shares as of
the date of exercise of the Stock Appreciation Right over (ii) a
specified price that shall not be less than 100% of the Fair Market Value of
such Shares as of the date of grant of the Stock Appreciation Right.  A Stock Appreciation Right may be granted in
connection with part or all of, in addition to, or completely independent of an
Option or any other Award under the Plan. 
If issued in connection with a previously or contemporaneously granted
Option, the Committee may impose a condition that exercise of a Stock
Appreciation Right cancels a pro rata portion of the Option with which it is
connected and vice versa.  Each Stock
Appreciation Right may be exercisable in whole or in part on the terms provided
in the Agreement.  No Stock Appreciation
Right shall be exercisable at any time after the expiration of its Term or if
the Participant’s employment (or service as a director) is terminated due to
Cause .  When a Stock Appreciation Right
is no longer exercisable, it shall be deemed to have lapsed or terminated.  Upon exercise of a Stock Appreciation Right,
payment to the Participant or a Successor or Transferee shall be made at such
time or times as shall be provided in the Agreement in the form of cash, Shares
or a combination of cash and Shares as determined by the Committee.  The Agreement may provide for a limitation
upon the amount or percentage of the total appreciation on which payment
(whether in cash and/or Shares) may be made in the event of the exercise of a
Stock Appreciation Right.

 

11.              Performance Units

 

11.1                           Initial Award

 

(a)    An Award of Performance Units under the Plan shall
entitle the Participant (or a Successor or Transferee) to future payments of
cash, Shares or a combination of cash and Shares, as determined by the Committee,
based upon the achievement of Performance Goals.  The Agreement may establish that a portion of
a Participant’s Award will be paid for performance that exceeds the minimum
target but falls below the maximum target applicable to the Award.  The Agreement shall also provide for the
timing of the payment.

 

(b)   Following the conclusion or acceleration of each
Performance Cycle, the Committee shall determine the extent to which (i) performance
targets have been attained, (ii) any other terms and conditions with
respect to an Award relating to the Performance Cycle have been satisfied and (iii) payment
is due with respect to an Award of Performance Units.

 

11.2                           Acceleration and Adjustment. 
To the extent consistent with Code Sections 409A and

 

 

162(m), the Agreement may permit an acceleration of
the Performance Cycle and an adjustment of performance targets and payments
with respect to some or all of the Performance Units awarded to a Participant,
upon the occurrence of certain events, which may, but need not include, without
limitation, a Fundamental Change, a recapitalization, a change in the
accounting practices of the Company, a change in the Participant’s title or
employment responsibilities, the Participant’s death, Disability or Retirement
or, with respect to payments in Shares with respect to Performance Units, a
reclassification, stock dividend, stock split or stock combination as provided
in Plan Section 16.  The Agreement
also may provide for a limitation on the value of an Award of Performance Units
that a Participant may receive.

 

12.              Effective Date and Duration of
the Plan

 

12.1                           Effective Date. 
The Plan shall become effective as of May 6, 2010, if the Plan is
approved by the requisite vote of shareholders at the 2010 Annual Meeting of
Shareholders or any adjournment thereof.

 

12.2                           Duration of the Plan. 
The Plan shall remain in effect until all Stock subject to it shall be
distributed, all Awards have expired or lapsed, the Plan is terminated pursuant
to Plan Section 15, or May 6, 2020 (the “Termination Date”);
provided, however, that Awards made before the Termination Date may be
exercised, vested or otherwise effectuated beyond the Termination Date unless
limited in the Agreement or otherwise. 
The date and time of approval by the Committee of the granting of an
Award shall be considered the date and time at which the Award is made or
granted.

 

13.              Plan Does Not
Affect Employment Status

 

(a)          Status as an eligible Employee shall not be construed
as a commitment that any Award will be made under the Plan to that eligible
Employee or to eligible Employees generally.

 

(b)         Nothing in the Plan or in any Agreement or related
documents shall confer upon any Employee or Participant any right to continue
in the employment of the Company or any Affiliate or constitute any contract of
employment or affect any right that the Company or any Affiliate may have to
change such person’s compensation, other benefits, job responsibilities, or
title, or to terminate the employment of such person with or without Cause.

 

14.              Tax Withholding.  No later than the date as of which an amount
with respect to an Award first becomes includible in the gross income of a
Participant for federal, state, local or foreign income or employment or other
tax purposes, the Participant shall pay to the Company, or make arrangements
satisfactory to the Company regarding the payment of, any such taxes required
by law to be withheld with respect to such amount.  Unless otherwise determined by the Company, withholding
obligations may be settled in Shares, including Shares that are part of the
Award that gives rise to the withholding requirement, having a Fair Market
Value on the date of withholding equal to the minimum amount (and not any
greater amount) required to be withheld for tax purposes, all in accordance
with such procedures as the Committee establishes.  The obligations of the Company under the Plan
shall be conditioned on such payment or arrangements, and the Company and its
Affiliates shall, to the extent permitted by law, have the right to deduct any
such taxes from any payment otherwise due the Participant.  The Committee may establish such procedures
as it deems appropriate, including making irrevocable elections, for the
settlement of withholding obligations under the Plan.  Notwithstanding anything in this Section 14
to the contrary, no

 

 

election
by a Participant to have taxes withheld with respect to an Award shall be
permitted to the extent it constitutes an impermissible acceleration under Code
Section 409A.

 

15.              Amendment, Modification
and Termination of the Plan

 

(a)          The Board may at any time and from time to time
terminate, suspend or modify the Plan. 
Except as limited in (b) below, the Committee may at any time alter
or amend any or all Agreements under the Plan to the extent permitted by law.

 

(b)         No termination, suspension, or modification of the
Plan will materially and adversely affect any right acquired by any Participant
or Successor or Transferee under an Award granted before the date of
termination, suspension, or modification, unless otherwise agreed to by the
Participant in the Agreement or otherwise, or required as a matter of law; but
it will be conclusively presumed that any adjustment for changes in
capitalization provided for in Plan Section 11.2 or 16 does not adversely
affect these rights.

 

16.              Adjustment for
Changes in Capitalization. 
Subject to any required action by the Company’s shareholders,
appropriate adjustments, so as to prevent enlargement of rights or
inappropriate dilution — (i) in the aggregate number and type of Shares
available for Awards under the Plan, (ii) in the limitations on the number
of Shares that may be issued to an individual Participant as an Option or a
Stock Appreciation Right in any calendar year or that may be issued in the form
of Restricted Stock or Shares without restrictions, (iii) in the number
and type of Shares and amount of cash subject to Awards then outstanding, (iv) in
the Option price as to any outstanding Options and, (v) subject to Plan Section 11.2,
in outstanding Performance Units and payments with respect to outstanding
Performance Units — may be made by the Committee in its sole discretion to give
effect to adjustments made in the number or type of Shares through a
Fundamental Change (subject to Plan Section 17), recapitalization,
reclassification, stock dividend, stock split, stock combination or other
relevant change, provided that fractional Shares shall be rounded to the
nearest whole Share.

 

17.              Fundamental
Change.  In the event of a proposed
Fundamental Change, the Committee may, but shall not be obligated to:

 

(a)          if the Fundamental Change is a merger or consolidation
or statutory share exchange, make appropriate provision for the protection of
the outstanding Options and Stock Appreciation Rights by the substitution of
options and stock appreciation rights in appropriate voting common stock of the
corporation surviving any merger or consolidation or, if appropriate, the
parent corporation of the Company or such surviving corporation; or

 

(b)         at least ten days before the occurrence of the
Fundamental Change, declare, and provide written notice to each holder of an
Option or Stock Appreciation Right of the declaration, that each outstanding
Option and Stock Appreciation Right, whether or not then exercisable, shall be
canceled at the time of, or immediately before the occurrence of the
Fundamental Change in exchange for payment to each holder of an Option or Stock
Appreciation Right, within ten days after the Fundamental Change, of cash equal
to (i) for each Share covered by the canceled Option, the amount, if any,
by which the Fair Market Value (as defined in this Section) per Share exceeds
the exercise price per Share covered by such Option or (ii) for each Stock
Appreciation Right, the price determined pursuant to Section 10, except
that Fair Market Value of the Shares as of the date of exercise of the Stock
Appreciation Right, as used in clause (i) of Plan

 

 

Section 10, shall be
deemed to mean Fair Market Value for each Share with respect to which the Stock
Appreciation Right is calculated determined in the manner hereinafter referred
to in this Section.  At the time of the
declaration provided for in the immediately preceding sentence, each Stock
Appreciation Right and each Option shall immediately become exercisable in full
and each person holding an Option or a Stock Appreciation Right shall have the
right, during the period preceding the time of cancellation of the Option or
Stock Appreciation Right, to exercise the Option as to all or any part of the
Shares covered thereby or the Stock Appreciation Right in whole or in part, as
the case may be.  In the event of a
declaration pursuant to this Section 17(b), each outstanding Option and
Stock Appreciation Right granted pursuant to the Plan that shall not have been
exercised before the Fundamental Change shall be canceled at the time of, or
immediately before, the Fundamental Change, as provided in the
declaration.  Notwithstanding the
foregoing, no person holding an Option or a Stock Appreciation Right shall be entitled
to the payment provided for in this Section 17(b) if such Option or
Stock Appreciation Right shall have terminated, expired or been cancelled.  For purposes of this Section only, “Fair
Market Value” per Share means the cash plus the fair market value, as
determined in good faith by the Committee, of the non-cash consideration to be
received per Share by the shareholders of the Company upon the occurrence of
the Fundamental Change.

 

18.              Forfeitures.  An Agreement may provide that if a
Participant has received or been entitled to payment of cash, delivery of
Shares, or a combination thereof pursuant to an Award within six months before
the Participant’s termination of employment with the Company and its
Affiliates, the Committee, in its sole discretion, may require the Participant
to return or forfeit the cash and/or Shares received with respect to the Award
(or its economic value as of (i) the date of the exercise of Options or
Stock Appreciation Rights, (ii) the date of, and immediately following, the
lapse of restrictions on Restricted Stock or the receipt of Shares without
restrictions, or (iii) the date on which the right of the Participant to
payment with respect to Performance Units vests, as the case may be) in the
event of certain occurrences specified in the Agreement.  The Committee’s right to require forfeiture
must be exercised within 90 days after discovery of such an occurrence but in
no event later than 15 months after the Participant’s termination of employment
with the Company and its Affiliates.  The
occurrences may, but need not, include competition with the Company or any
Affiliate, unauthorized disclosure of material proprietary information of the
Company or any Affiliate, a violation of applicable business ethics policies of
the Company or Affiliate or any other occurrence specified in the Agreement
within the period or periods of time specified in the Agreement.

 

19.              Corporate
Mergers, Acquisitions, Etc.  Subject to Code Section 409A, the
Committee may also grant Options, Stock Appreciation Rights, Restricted Stock
or other Awards under the Plan in substitution for, or in connection with the
assumption of, existing options, stock appreciation rights, restricted stock or
other award granted, awarded or issued by another corporation and assumed or
otherwise agreed to be provided for by the Company pursuant to or by reason of
a transaction involving a corporate merger, consolidation, acquisition of
property or stock, separation, reorganization or liquidation to which the
Company or a Subsidiary is a party.  The
terms and conditions of the substitute Awards may vary from the terms and
conditions set forth in the Plan to the extent as the Board at the time of the
grant may deem appropriate to conform, in whole or in part, to the provisions of
the awards in substitution for which they are granted.

 

20.              Unfunded Plan.  The Plan shall be unfunded and the Company
shall not be required to segregate any assets that may at any time be
represented by Awards under the Plan. 
Neither the Company, its Affiliates, the Committee, nor the Board shall
be deemed to be a trustee of any amounts to be paid under the Plan

 

 

nor
shall anything contained in the Plan or any action taken pursuant to its
provisions create or be construed to create a fiduciary relationship between
the Company and/or its Affiliates, and a Participant or Successor or
Transferee.  To the extent any person
acquires a right to receive an Award under the Plan, this right shall be no
greater than the right of an unsecured general creditor of the Company.

 

21.              Limits of Liability

 

(a)          Any liability of the Company to any Participant with
respect to an Award shall be based solely upon contractual obligations created
by the Plan and the Award Agreement.

 

(b)         Except as may be required by law, neither the Company
nor any member of the Board or of the Committee, nor any other person
participating in any determination of any question under the Plan, or in the
interpretation, administration or application of the Plan, shall have any
liability to any party for any action taken, or not taken, in good faith under
the Plan.

 

22.              Compliance with
Applicable Legal Requirements.  No certificate for Shares distributable
pursuant to the Plan shall be issued and delivered unless the issuance of the
certificate complies with all applicable legal requirements including, without
limitation, compliance with the provisions of applicable state securities laws,
the Securities Act of 1933, as amended and in effect from time to time or any
successor statute, the Exchange Act and the requirements of the exchanges on
which the Company’s Shares may, at the time, be listed.

 

23.              Other Benefit and
Compensation Programs. 
Payments and other benefits received by a Participant under an Award
made pursuant to the Plan shall not be deemed a part of a Participant’s
regular, recurring compensation for purposes of the termination, indemnity or
severance pay laws of any country and shall not be included in, nor have any
effect on, the determination of benefits under any other employee benefit plan,
contract or similar arrangement provided by the Company or an Affiliate unless
expressly so provided by such other plan, contract or arrangement, or unless
the Committee expressly determines that an Award or portion of an Award should
be included to accurately reflect competitive compensation practices or to
recognize that an Award has been made in lieu of a portion of competitive cash
compensation.

 

24.              Beneficiary Upon
Participant’s Death.  To the extent
that the transfer of a Participant’s Award at his or her death is permitted
under an Agreement, a Participant’s Award shall be transferable at death to the
estate or to the person who acquires the right to succeed to the Award by
bequest or inheritance.

 

25.              Requirements of Law

 

(a)          To the extent that federal laws do not otherwise
control, the Plan and all determinations made and actions taken pursuant to the
Plan shall be governed by the laws of the State of Illinois without regard to
its conflicts-of-law principles and shall be construed accordingly.

 

(b)         If 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 be construed and enforced as if
the illegal or invalid provision had not been included.

 

26.              Repricing; Shareholder Approval. 
Except as provided in Plan Section 16, neither the Board nor any
committee thereof shall cause the Company to adjust or amend the exercise price
of any outstanding Award, whether through amendment, replacement grant,  exchange or other means, without the prior
approval of the shareholders of the Company.

 

27.              Compliance with Code Section 409A. 
Any benefit under the Plan that is or becomes subject to Code Section 409A
is intended to comply with the requirements of Code Section 409A, and the
benefit will administered, and any Plan term governing such benefit will be
interpreted, accordingly.

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