Document:

EX-10.5

 

Exhibit 10.5

BOB EVANS FARMS, INC. AND AFFILIATES

THIRD AMENDED AND RESTATED

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	PAGE	 
	SECTION 1.00 PURPOSE
	 	 	1	 
	 
	 	 	 	 
	SECTION 2.00 DEFINITIONS
	 	 	1	 
	 
	 	 	 	 
	2.01 Account
	 	 	1	 
	2.02 Beneficiary
	 	 	1	 
	2.03 Board
	 	 	1	 
	2.04 Cause
	 	 	1	 
	2.05 Change Agreement
	 	 	1	 
	2.06 Change in Control
	 	 	1	 
	2.07 Code
	 	 	2	 
	2.08 Committee
	 	 	2	 
	2.09 Common Shares
	 	 	2	 
	2.10 Confidential Information
	 	 	2	 
	2.11 Disability
	 	 	2	 
	2.12 Early Retirement Date
	 	 	3	 
	2.13 Eligible Employee
	 	 	3	 
	2.14 Employer
	 	 	3	 
	2.15 Employer Contribution
	 	 	3	 
	2.16 Enrollment Form
	 	 	3	 
	2.17 ERISA
	 	 	3	 
	2.18 Grandfathered Amount
	 	 	3	 
	2.19 Group
	 	 	3	 
	2.20 Group Member
	 	 	3	 
	2.21 Inactive Participant
	 	 	3	 
	2.22 Member
	 	 	3	 
	2.23 Normal Retirement Date
	 	 	3	 
	2.24 Participant
	 	 	4	 
	2.25 Plan
	 	 	4	 
	2.26 Plan Year
	 	 	4	 
	2.27 Section 409A Amount
	 	 	4	 
	2.28 Specified Employee
	 	 	4	 
	2.29 Spouse
	 	 	4	 
	2.30 Termination
	 	 	4	 
	 
	 	 	 	 
	SECTION 3.00 PARTICIPATION
	 	 	4	 
	 
	 	 	 	 
	3.01 Eligibility to Participate
	 	 	4	 
	3.02 Designation of Beneficiary
	 	 	5	 
	 
	 	 	 	 
	SECTION 4.00 MEMBERS’ OBLIGATIONS
	 	 	5	 

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	 	 	PAGE	 
	4.01 Services During Certain Events
	 	 	5	 
	4.02 Confidential Information
	 	 	6	 
	4.03 Effect of Breach of Obligations
	 	 	6	 
	 
	 	 	 	 
	SECTION 5.00 CONTRIBUTIONS
	 	 	6	 
	 
	 	 	 	 
	5.01 Accounts
	 	 	6	 
	5.02 Participants’ Earned Benefit
	 	 	6	 
	5.03 Employer Contribution
	 	 	10	 
	5.04 Effect of Change in Control on Employer Contribution
	 	 	10	 
	5.05 Interest
	 	 	11	 
	 
	 	 	 	 
	SECTION 6.00 DISTRIBUTIONS
	 	 	11	 
	 
	 	 	 	 
	6.01 Distributions
	 	 	11	 
	6.02 Death Benefits
	 	 	12	 
	6.03 Disability Benefits
	 	 	12	 
	6.04 Termination Other Than Death or Disability
	 	 	12	 
	6.05 Amount and Payment of Benefits
	 	 	12	 
	 
	 	 	 	 
	SECTION 7.00 PLAN COMMITTEE
	 	 	15	 
	 
	 	 	 	 
	7.01 Appointment of Committee
	 	 	15	 
	7.02 Powers and Duties
	 	 	15	 
	7.03 Actions by the Committee
	 	 	16	 
	7.04 Interested Committee Members
	 	 	16	 
	7.05 Indemnification
	 	 	16	 
	7.06 Conclusiveness of Action
	 	 	17	 
	7.07 Payment of Expenses
	 	 	17	 
	7.08 Claims Procedure
	 	 	17	 
	7.09 Arbitration
	 	 	19	 
	 
	 	 	 	 
	SECTION 8.00 AMENDMENT TO THE PLAN
	 	 	19	 
	 
	 	 	 	 
	8.01 Right to Amend
	 	 	19	 
	8.02 Amendment Procedure
	 	 	20	 
	 
	 	 	 	 
	SECTION 9.00 TERMINATION OF THE PLAN
	 	 	20	 
	9.01 Right to Terminate
	 	 	20	 
	9.02 Plan Merger and Consolidation
	 	 	20	 
	9.03 Successor Employer
	 	 	20	 
	 
	 	 	 	 
	SECTION 10.00 UNFUNDED PLAN
	 	 	20	 
	 
	 	 	 	 
	SECTION 11.00 MISCELLANEOUS
	 	 	21	 

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	 	 	PAGE	 
	11.01 Voluntary Plan
	 	 	21	 
	11.02 Non-alienation of Benefits
	 	 	21	 
	11.03 Inability to Receive Benefits
	 	 	21	 
	11.04 Lost Members
	 	 	21	 
	11.05 Limitation of Rights
	 	 	21	 
	11.06 Invalid Provision
	 	 	21	 
	11.07 One Plan
	 	 	21	 
	11.08 Governing Law
	 	 	22	 
	11.09 Code §409A
	 	 	22	 

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BOB EVANS FARMS, INC. AND AFFILIATES

THIRD AMENDED AND RESTATED

SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN

SECTION 1.00 PURPOSE

On April 17, 1992, Bob Evans Farms, Inc. (“Corporation”) adopted the Bob Evans Farms, Inc.
Supplemental Executive Retirement Plan to provide deferred and incentive compensation to a select
group of its management or highly compensated employees. The Plan was amended and restated
effective May 1, 1998 and effective May 1, 2002 and was subsequently amended effective as of
January 1, 2006, February 13, 2007 and June 11, 2007. Effective as of January 1, 2008, the
Corporation adopts this third amended and restated version of the Plan. This Plan is intended to
be an unfunded, nonqualified program of deferred compensation within the meaning of Title I of
ERISA.

SECTION 2.00 DEFINITIONS

When used in this Plan, the following terms will have the meanings given to them in this section
unless another meaning is expressly provided elsewhere in this Plan. When applying these
definitions, the form of any term or word will include any of its other forms.

2.01 Account. The account established under Section 5.01 to measure the value of each Member’s
Plan benefit. The Account of any Member shall include both Grandfathered Amounts and Section 409A
Amounts, as applicable.

2.02 Beneficiary. The person a Member designates under Section 3.02 to receive any death benefit
payable under Section 6.02.

2.03 Board. The Corporation’s board of directors.

2.04 Cause. A Member’s (1) willful and continued refusal to substantially perform assigned duties
(other than any refusal resulting from incapacity due to physical or mental illness), (2) willful
engagement in gross misconduct materially and demonstrably injurious to any Group Member or
(3) breach of any term of this Plan. Notwithstanding the foregoing, “Cause” will not arise solely
because the Member is absent from active employment during periods of vacation, consistent with the
Employer’s applicable vacation policy, or other period of absence initiated by the Member and
approved by the Employer.

2.05 Change Agreement. An individual agreement between the Corporation and any Member describing
the effect of a Change in Control.

2.06 Change in Control.

(1) With respect to any Member who is a party to a Change Agreement, a “change in control”
as defined in (and subject to the terms of) that Member’s Change Agreement; and

 

 

(2) With respect to all Members, approval by the Corporation’s stockholders of a definitive
agreement (a) to merge or consolidate the Corporation with or into another corporation in
which the Corporation is not the continuing or surviving corporation or pursuant to which
any Common Shares would be converted into cash, securities or other property of another
corporation, other than a merger of the Corporation in which holders of Common Shares
immediately before the merger have the same proportionate ownership of shares of the
surviving corporation immediately after the merger as immediately before or (b) within a
12-consecutive calendar month period, to sell or otherwise dispose of 50 percent or more of
the book value of the Group’s assets. For purposes of this definition, “book value” will be
established on the basis of the latest consolidated financial statement the Corporation
filed with the Securities and Exchange Commission before the date any 12-consecutive
calendar month measurement period began.

2.07 Code. The Internal Revenue Code of 1986, as amended, or any successor statute.

2.08 Committee. The committee described in Section 7.00.

2.09 Common Shares. The Corporation’s shares of common stock, par value $0.01 per share, or any
security issued in substitution, exchange or in place of such shares.

2.10 Confidential Information. Any and all information (other than information in the public
domain) related to the business of the Group or any Group Member, including all processes,
inventions, trade secrets, computer programs, engineering or technical data, drawings, or designs,
manufacturing techniques, information concerning pricing and pricing policies, marketing
techniques, plans and forecasts, new product information, information concerning suppliers, methods
and manner of operations, and information relating to the identity and location of all past,
present and prospective customers.

2.11 Disability.

(1) With respect to Grandfathered Amounts, an incapacity due to physical or mental illness
that has prevented a Member from discharging assigned duties on a full-time basis for at
least 26 consecutive weeks.

(2) With respect to Section 409A Amounts:

(a) The Member is unable to engage in any substantial gainful activity by reason of
any medically determinable physical or mental impairment that can be expected to
result in death or can be expected to last for a continuous period of not less than
12 months; or

(b) The Member is, by reason of any medically determinable physical or mental
impairment that can be expected to result in death or can be expected to
last for a continuous period of not less than 12 months, receiving income
replacement benefits for a period of not less than three months under an accident
and health plan covering employees of the Member’s Employer; or

2

 

(c) The Member is determined to be totally disabled by the Social Security
Administration or the Railroad Retirement Board.

2.12 Early Retirement Date. The earlier of the date that (1) a Member reaches age 55 and has been
credited with at least ten years of service with the Group or (2)(a) the sum of the Member’s age
(measured in whole years only) and years of service with the Group (measured in whole years only)
equals 70 and (b) the Member has been credited with at least ten years of service with the Group.
In the sole discretion of the Committee, the calculation of a Member’s “years of service” with the
Group may include the Member’s years of service with a predecessor employer who becomes a Group
Member.

2.13 Eligible Employee. Each person who is employed by a Group Member and who is a member of its
select group of management or is a highly compensated employee within the meaning of Title I of
ERISA.

2.14 Employer. The Group Member by which a Member is directly employed on the date of any event,
act or occurrence described in this Plan. If, without incurring a Termination, a Member becomes a
common law employee of a Group Member other than the Employer, that Group Member will automatically
become that Member’s “Employer” under this Plan and will be fully liable as the Member’s Employer
for all obligations arising under this Plan with respect to that Member during the period of that
relationship.

2.15 Employer Contribution. The amount calculated under Sections 5.02 and 5.03.

2.16 Enrollment Form. The written or electronic form that each Eligible Employee must complete
before he or she may participate in the Plan. To be effective, the Enrollment Form must include
all of the information described in Section 3.01.

2.17 ERISA. The Employee Retirement Income Security Act of 1974, as amended.

2.18 Grandfathered Amount. The portion, if any, of a Member’s Account that was earned and vested
under the Plan (within the meaning of Code §409A) as of December 31, 2004 and any earnings on such
portion of the Account (within the meaning of Code §409A).

2.19 Group. The Corporation and all persons with whom the Corporation would be considered a single
employer under Code §§414(b) and (c).

2.20 Group Member. Each entity that is a member of the Group.

2.21 Inactive Participant. A Participant who (1) is actively employed by an Employer but no longer
meets the eligibility conditions described in Section 3.01 or (2) has Terminated but has not
received a complete distribution of his or her Account balance.

2.22 Member. Collectively, (1) a Participant or (2) an Inactive Participant.

2.23 Normal Retirement Date. The date a Member reaches age 62.

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2.24 Participant. Each Eligible Employee who is actively participating in the Plan as provided in
Section 3.01.

2.25 Plan. The Bob Evans Farms, Inc. and Affiliates Third Amended and Restated Supplemental
Executive Retirement Plan, as described in this document and as it may be subsequently amended from
time to time.

2.26 Plan Year. Each fiscal year of the Corporation while the Plan is in effect.

2.27 Section 409A Amount. The portion of a Member’s Account that is not a Grandfathered Amount.

2.28 Specified Employee. A “specified employee” within the meaning of Treasury Regulation
§1.409A-1(i) and as determined under the Corporation’s policy for determining specified employees.

2.29 Spouse. The individual to whom a Member is legally married.

2.30 Termination. A “separation from service” with the Group within the meaning of Treasury
Regulation §1.409A-1(h).

SECTION 3.00 PARTICIPATION

3.01 Eligibility to Participate.

(1) In its sole discretion, the Committee will decide which Eligible Employees may
participate in the Plan and the earliest date on which they may participate.
Notwithstanding the foregoing, any Eligible Employee who is participating in the Plan on
January 1, 2008 shall be a Participant, except as provided in Section 3.01(3).

(2) Before an Eligible Employee who is selected by the Committee to participate in the Plan
may actually participate in the Plan, the Eligible Employee must complete an
Enrollment Form specifying how his or her Account will be distributed (as described in
Section 6.05). Such election must be made and become irrevocable no later than the December
31 preceding the first day of the first Plan Year in which services relating to the Eligible
Employee’s participation in this Plan will be performed. Notwithstanding the foregoing:

(a) With respect to the first Plan Year in which an Eligible Employee becomes
eligible to participate in the Plan, the Eligible Employee may submit the Enrollment
Form to the Committee within 30 days after the date on which the Participant is
first eligible to participate in this Plan. For purposes of this Section
3.01(2)(a), an Eligible Employee is first eligible to participate in this Plan only
if the Eligible Employee is not a participant in any other agreement, method,
program or arrangement that, along with this Plan, would be treated as a single
nonqualified deferred compensation plan under Treasury Regulation §1.409A-1(c)(2).

4

 

(b) If, in order to receive an Employer Contribution under this Plan, an Eligible
Employee is required to provide services to the Corporation or any other Group
Member for a period of at least 12 months from the date that the Eligible Employee
obtains a non-forfeitable legally binding right to the Employer Contribution, the
Eligible Employee may submit the Enrollment Form to the Committee on or before the
30th day after the Eligible Employee obtains such legally binding right,
provided that the election is made at least 12 months in advance of the earliest
date at which the forfeiture condition could lapse.

(3) An Eligible Employee will continue to be a Participant until the earlier of the date he
or she (a) becomes an Inactive Participant or (b) Terminates but is not an Inactive
Participant.

3.02 Designation of Beneficiary.

(1) Each Eligible Employee must designate one or more Beneficiaries by completing a written
or electronic beneficiary designation form prescribed by the Committee. Unless a Member who
designates more than one Beneficiary also specifies the sequence or the portion of the death
benefit to be paid to each Beneficiary, the death benefit will be paid in equal shares to
all named Beneficiaries.

(2) A Member may change his or her Beneficiary at any time by completing a new beneficiary
designation form in accordance with such form’s instructions. No change of Beneficiary will
be effective until the form is completed and received by the Committee. The identity of a
Member’s Beneficiary will be based only on the designation in the form described in this
section and will not be inferred from any other evidence.

(3) If a Member has not made an effective Beneficiary designation or if all his or her
Beneficiaries die before the Member, Plan death benefits will be paid to the Member’s
surviving Spouse or, if there is no surviving Spouse, to the Member’s estate. Any
minor’s share of a Plan death benefit will be paid to the adult who has been appointed to
act as the minor’s legal guardian and who has assumed custody and support of that minor.

(4) The Member and the Beneficiary (and not the Committee) are responsible for ensuring that
the Committee has the Beneficiary’s current address.

SECTION 4.00 MEMBERS’ OBLIGATIONS

4.01 Services During Certain Events. By accepting participation in this Plan, if any “person” or
entity (including a “group” as defined in Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934, as amended, or any successor statute) initiates a tender or exchange offer,
distributes proxy materials to the Corporation’s stockholders or takes other steps to effect, or
that may result in, a Change in Control, each Member agrees not to Terminate voluntarily during the
pendency of that activity other than by reason of retirement, and to continue to serve as a
full-time employee of the Employer until those efforts are abandoned, that activity is terminated
or until a Change in Control has occurred.

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4.02 Confidential Information. Except as otherwise required by applicable law, by accepting
participation in this Plan, each Member expressly agrees to keep and maintain Confidential
Information confidential and not, at any time during or subsequent to the Member’s employment with
any Group Member, to use any Confidential Information for the Member’s own benefit or to divulge,
disclose or communicate any Confidential Information to any person or entity in any manner except
(1) to employees or agents of the Employer or of the Corporation that need the Confidential
Information to perform their duties on behalf of any Group Member or (2) in the performance of the
Member’s duties to the Employer. Each Member also agrees to notify the Corporation promptly of any
circumstance that the Member believes may legally compel the disclosure of Confidential Information
and to give this notice before disclosing any Confidential Information.

4.03 Effect of Breach of Obligations. If a Member breaches any obligation described in this
Section 4.00 or the Plan:

(1) Before the Member has Terminated, the Member will forfeit all benefits under this Plan;
or

(2) After the Member Terminates, the Member will repay any amounts previously paid to the
Member under this Plan plus interest calculated at the prime interest rate quoted in the
Wall Street Journal, or any successor to it, over the period beginning on the date of
payment and ending on the date of repayment.

SECTION 5.00 CONTRIBUTIONS

5.01 Accounts. The Committee will establish an Account for each Member to record:

(1) The Employer Contribution, calculated under Sections 5.02 and 5.03 (and, if applicable,
Section 5.04); minus

(2) Any distributions made to the Member under Section 6.00.

The Employer also will make a final Employer Contribution, calculated as provided in Sections 5.02
and 5.03, for the portion of the Valuation Period during which the Member Terminates but only if
the Member Terminates after meeting the conditions described in Section 6.04.

5.02 Participants’ Earned Benefit. As of each Valuation Date (as defined below), the Committee
will calculate the amount to be credited to each Participant’s Account by applying the following
steps:

(1) First, the Employer will establish the Valuation Period for which the contribution is
being calculated. For these purposes:

(a) A “Valuation Period” is the period between each Valuation Date during which a
Participant performs substantial services for a Group Member (i) beginning on the
later of (A) the date a Participant first was employed by a Group Member or
(B) April 26, 1991 and (ii) ending on the earlier of the date the

6

 

Participant
(A) Terminates, (B) is no longer a Participant (whether or not he or she remains a
Member), or (C) reaches his or her Normal Retirement Date, whether or not he or she
also retires at that time. Unless the Committee specifically provides otherwise,
all Valuation Periods will be comprised of 12 months and will end as of the last day
of each Plan Year; and

(b) A “Valuation Date” is the date the most recent Employer Contribution was
calculated.

(2) Then, the Committee will calculate the Compensation (as defined below) that each
Participant earned during the Valuation Period for which the Employer Contribution is being
calculated. For these purposes, “Compensation” means (a) the total taxable remuneration the
Participant earned for the Valuation Period (or, if less, the portion of the Valuation
Period during which he or she was a Participant) plus (b) the amount the Participant
deferred during the Valuation Period to a plan described in Code §125 or Code §401(k) and
maintained by any Group Member minus (c)(i) the amount of any long-term incentive awards
(e.g., performance share awards, restricted stock or stock appreciation rights) granted,
earned or exercised during the Valuation Period and (ii) the value of any stock options
granted or exercised under Code §83(b) during that Valuation Period. Also, if a Valuation
Period is less than 12 months, the taxable remuneration
described in Section 5.02(2)(a) will be annualized on the basis of the whole months during
that Valuation Period during which the Participant was a Participant.

(3) Then, the Committee will calculate each Participant’s “Projected Compensation” by:

(a) Averaging each Participant’s Compensation over the lesser of (i) the
Participant’s current and four preceding Valuation Periods or (ii) the number of
Valuation Periods during which the Participant was employed by a Group Member; and

(b) Increasing that average by four percent for each 12-month Valuation Period that
will elapse between (i) the end of the Valuation Period for which the Employer
Contribution is being calculated and (ii) the last Valuation Period that will end
before the Participant’s Normal Retirement Date, then (iii) averaging the
Compensation projected to be received during the five Valuation Periods ending
before the Participant’s Normal Retirement Date.

(4) Then, the Committee will calculate each Participant’s “Final Average Compensation.”

(a) Until the Participant reaches his or her Normal Retirement Date, Final Average
Compensation will be calculated by averaging each Participant’s Projected
Compensation (calculated under Section 5.02(3)) over the five consecutive Valuation
Periods during the ten Valuation Periods that both (i) end before the Participant’s
Normal Retirement Date and (ii) produce the highest average; but

7

 

(b) At the Participant’s Normal Retirement Date, Final Average Compensation will be
calculated by averaging the Participant’s Compensation over the five consecutive
Valuation Periods during the ten Valuation Periods that end before the Participant’s
Normal Retirement Date that produces the highest average.

(c) The following rules will be applied when calculating a Participant’s Final
Average Compensation:

(i) The Final Average Compensation of a Participant who will have completed
fewer than five Valuation Periods at his or her Normal Retirement Date will
be the average of the Compensation the Participant received over his or her
entire period of participation;

(ii) Compensation paid for the Valuation Period during which the Participant
reaches Normal Retirement Date will be disregarded until the Participant
reaches his or her Normal Retirement Date; and

(iii) A Participant’s Final Average Compensation will neither increase nor
decrease for any Valuation Period that begins after the Participant reaches
his or her Normal Retirement Date.

(5) Then, the Committee will establish each Participant’s Prior Service Rate (as defined
below), if any. A Participant’s “Prior Service Rate” (if any) is:

(a) The lesser of (i) 40 percent or (ii) two percent multiplied by the number of
12-month Valuation Periods the Participant will complete if he or she continues to
be a Participant until his or her Normal Retirement Date; multiplied by

(b) The quotient produced by dividing (i) the number of Valuation Periods the
Participant had completed as of the last day of the Corporation’s 1997 fiscal year
by (ii) the number of 12-month Valuation Periods the Participant will complete if he
or she continues to be a Participant until his or her Normal Retirement Date.

A Participant who was first employed after the Corporation’s 1997 fiscal year will not have
a Prior Service Rate.

(6) A Participant’s “Future Service Rate” is:

(a) The lesser of (i) 55 percent or (ii) 2.75 percent multiplied by the number of
12-month Valuation Periods the Participant will complete if he or she continues to
be a Participant until his or her Normal Retirement Date; reduced, but not below
zero, by

(b) The Participant’s Prior Service Rate (if any) calculated under Section 5.02(5);
and then multiplied by

8

 

(c) The lesser of (i) one or (ii) the quotient produced by dividing (A) the number
of Valuation Periods the Participant had completed after the Corporation’s 1997
fiscal year into (B) the greater of five or the number of Valuation Periods the
Participant will complete after the end of the Corporation’s 1997 fiscal year if he
or she continues to be a Participant until his or her Normal Retirement Date.

(7) Then, the Committee will calculate each Participant’s Target Benefit. A Participant’s
“Target Benefit” is:

(a) The greater of (i) the sum of (A) the Participant’s Final Average Compensation
(calculated under Section 5.02(4)); multiplied by the Participant’s Prior Service
Rate, if any (calculated under Section 5.02(5)); plus (B) the Participant’s Final
Average Compensation (calculated under Section 5.02(4)); multiplied by the
Participant’s Future Service Rate (calculated under Section 5.02(6)); or (ii) the
Participant’s Target Benefit calculated as of the last day of the preceding
Valuation Period; minus

(b)(i) The Participant’s Social Security Benefit (as defined below) plus (ii) the
Participant’s Qualified Plan Benefit (as defined below); and then multiplied by
(iii) the lesser of (A) one or (B) the quotient produced by dividing the
Participant’s actual number of 12-month Valuation Periods completed as of the date
the Target Benefit is being calculated by the number of 12-month Valuation Periods
that the Participant will complete if he or she remains actively employed until his
or her Normal Retirement Date.

(c) For purposes of calculating each Participant’s Target Benefit:

(i) A Participant’s “Social Security Benefit” is 50 percent of the maximum
annual Old Age, Survivor and Disability Insurance benefit projected to be
payable to the Participant under the Social Security Act as of the
Participant’s Normal Retirement Date. This amount will be based on the
Participant’s projected “taxable wages,” as defined in the Social Security
Act, and other relevant factors in effect as of the date the calculation is
being made; and

(ii) A Participant’s “Qualified Plan Benefit” is the Participant’s annual
benefit, expressed in the form of a single life annuity, that can be derived
from the sum of all employer-funded benefits (as defined below), and
attributable earnings, under all plans that are maintained by any Group
Member and that are intended to comply with Code §401(a). The amount of
this single life annuity will be established by applying the RP 2000
Mortality Table for Males and Females, an annual interest rate of eight
percent, and by assuming that benefits will begin at the Participant’s
Normal Retirement Date. For purposes of establishing a Participant’s
Qualified Plan Benefit, “employer-funded benefits” means all benefits funded
through Employer contributions (and attributable earnings), for

9

 

periods of
employment before the Participant’s Normal Retirement Date plus any
distributions made to, in behalf of or with respect to, the Participant
before his or her Normal Retirement Date (e.g., in-service withdrawals,
retirement and disability benefits or distributions under any domestic
relations order). Also, until the Participant reaches his or her Normal
Retirement Date, his or her Qualified Plan Benefit will be projected based
on procedures established by the Committee.

(8) Then, the Committee will compare the Participant’s Target Benefit calculated under
Section 5.02(7) with the Target Benefit calculated for the same Participant under Section
5.02(7) as in effect for the preceding Valuation Period.

(a) If the Participant’s Target Benefit calculated for the current Valuation Period
is less than or equal to the Participant’s Target Benefit calculated for the
preceding Valuation Period, no amount will be credited to the Participant’s Account
for the current Valuation Period; but

(b) If the Participant’s Target Benefit calculated for the current Valuation Period
is greater than the Participant’s Target Benefit calculated for the preceding
Valuation Period, an Earned Benefit will be credited to the Participant’s Account.
This Earned Benefit will be calculated under the procedures described in
Section 5.02(9).

(9) If the Participant’s Target Benefit for the current Valuation Period is greater than the
Participant’s Target Benefit for the preceding Valuation Period, the Committee will
calculate an “Earned Benefit” for the current Valuation Period by:

(a) Subtracting the Participant’s Target Benefit for the preceding Valuation Period
from the Target Benefit calculated for the current Valuation Period; and

(b) Calculating the annuity value of this difference. This calculation is done by
calculating the present value of the difference produced under Section 5.02(9)(a) by
applying the RP 2000 Mortality Table for Males and Females, an annual interest rate
of eight percent and by assuming that benefits will begin at the Participant’s
Normal Retirement Date or, if the Participant already has reached his or her Normal
Retirement Date, that benefits will begin when the Participant reaches age 65.

5.03 Employer Contribution. The Employer Contribution for each Participant is the amount
calculated under Section 5.02(9)(b). This amount will be credited to each Participant’s Account in
cash (and credited with interest as described in Section 5.05).

5.04 Effect of Change in Control on Employer Contribution.

(1) Subject to any limitation imposed under a Change Agreement, if, within 36 months after a
Change in Control, (a) the Plan is terminated and not replaced with a similar program
providing comparable benefits and features or (b) with respect to a Member who is a party to
a Change Agreement, an event occurs that generates a change

10

 

in control payment under that
Member’s Change Agreement, (c) all Members’ Accounts will be fully vested and (d) the
Employer will credit a special and additional Employer Contribution to the Account of each
Member who was a Participant on the date of the Change in Control, whether or not he or she
is then a Participant.

(2) The special change in control benefit will be calculated as provided in Sections 5.02
and 5.03 except that the Target Benefit (see Section 5.02(7)) will be calculated under the
following formula:

(a) 2.75% X Final Average Compensation (as defined in Section 5.02(4)) X the lesser
of (i) 20 and (ii) the Participant’s Valuation Periods expected to be earned as of
the Participant’s Normal Retirement Date or the date of the Change in Control, if
later; minus

(b) The Participant’s Social Security Benefit (as defined in Section 5.02(7)(c)(i));
minus

(c) The Participant’s Qualified Plan Benefit (as defined in Section 5.02(7)(c)(ii));
multiplied by

(d) The smaller of (i) one or (ii) the quotient produced by dividing the
Participant’s actual Valuation Periods earned as of the date the Target Benefit is
being calculated by the number of 12-month Valuation Periods the Participant will
complete if he or she remains actively employed until his or her Normal Retirement
Date. For purposes of this Section 5.04(2)(d), the actual Valuation Periods
completed as of the date the Target Benefit is being calculated shall include any
partial Valuation Period (measured in increments of one-twelfth) completed by the
Participant during the period beginning on the day after the Valuation Date
immediately preceding the date the Target Benefit is being calculated and ending on
the date the Target Benefit is being calculated.

Sections 5.02 and 5.03 will then be applied.

(3) Regardless of any provision of this Plan, if more than one Change in Control (whether or
not related) occurs, the total additional amount calculated under this Section 5.04 will be
the greatest amount calculated with respect to any single Change in Control.

5.05 Interest. As of each Valuation Date, amounts credited as cash to Accounts will be credited
with interest at rates established by the Committee.

SECTION 6.00 DISTRIBUTIONS

6.01 Distributions. Subject to Section 6.05, a Member’s Account will become distributable at the
earlier of the date the Member (1) dies, (2) becomes Disabled prior to Terminating or
(3) Terminates after having earned a right to a Plan benefit as provided in Section 6.04.

11

 

6.02 Death Benefits. If a Member Terminates due to his or her death, the undistributed value of
(a) the Member’s Grandfathered Amounts will be paid to the Member’s Beneficiary in a lump sum as of
the Valuation Date following the Member’s death and (b) the Member’s Section 409A Amounts will be
paid to that Member’s Beneficiary in a lump sum within 60 days of the Member’s death. Any
Beneficiary claiming a death benefit under the Plan must provide the Committee with satisfactory
proof of the Member’s death before any death benefit will be paid. If a Member dies after
Terminating, the undistributed portion of the Member’s Account will be paid to that Member’s
Beneficiary in a lump sum within 60 days of the Member’s death.

6.03 Disability Benefits. A Member who becomes Disabled before Terminating will receive a lump sum
distribution of 100 percent of his or her Account within 60 days following the date the Member
becomes Disabled. If a Member becomes Disabled after Terminating, the undistributed portion of the
Member’s Account will be
paid in the same form in which it was being paid to the Member prior to the Member’s Disability (or
would have been paid, if benefit commencement had not then begun).

6.04 Termination Other Than Due to Death or Prior to Disability. A Member who Terminates for any
reason other than death or prior to becoming Disabled will not be entitled to any Plan benefit if
he or she Terminates before the earlier of:

(1) His or her Early Retirement Date or Normal Retirement Date; or

(2) An event described in Section 5.04(1)(a) or (b).

Notwithstanding the foregoing, in no case will a Member be entitled to receive any Plan benefit if
he or she is Terminated for Cause.

6.05 Amount and Payment of Benefits.

(1) Grandfathered Amounts.

(a) Normal Benefit Form. Unless the Member has effectively elected an
optional benefit form described in Section 6.05(1)(b), all distributions of
Grandfathered Amounts made to a Member who Terminates after having earned a
nonforfeitable benefit as provided in Section 6.04 will be paid in ten annual
installments beginning no later than 60 days after the Member Terminates. The first
of these distributions will be equal to one-tenth of the value of the Member’s
Grandfathered Amounts on the preceding Valuation Date. Subsequent distributions
will be made on the anniversary of the initial distribution date and will equal the
balance of the Member’s Grandfathered Amounts as of the most recent Valuation Date
divided by the number of unpaid annual installments.

(b) Optional Benefit Form. Instead of the normal distribution form
described in Section 6.05(1)(a), a Member may elect to receive (or begin to receive)
his or her Grandfathered Amounts:

(i) In the form of a single lump sum. If this election is made effectively,
the Grandfathered Amounts will be distributed within 60 days

12

 

after the
Valuation Date that coincides with or immediately follows the date the
Member Terminated; or

(ii) As described in Section 6.05(1)(a) but beginning as of the last day of
the Plan Year during which the Member reaches age 65 (regardless of whether
or not the Member has Terminated).

(2) Section 409A Amounts.

(a) Normal Benefit Form. Unless the Member has effectively elected an
optional benefit form described in Section 6.05(2)(b), all distributions of
Section 409A Amounts made to a Member who Terminates after having earned a
nonforfeitable benefit as provided in Section 6.04 will be paid in ten annual
installments beginning no later than 60 days after the date that the Member
Terminates, determined in the sole discretion of the Committee. The first of these
distributions will be equal to one-tenth of the value of the Member’s Section 409A
Amounts on the preceding Valuation Date. Subsequent distributions will be made on
the anniversary of the initial distribution date and will equal the balance of the
Member’s Section 409A Amounts as of the most recent Valuation Date divided by the
number of unpaid annual installments.

(b) Optional Benefit Form. Instead of the normal distribution form
described in Section 6.05(2)(a), a Member may elect, on a properly submitted
Enrollment Form, to receive (or begin to receive) his or her Section 409A Amounts
in:

(i) A lump sum within 60 days after the date that the Member Terminates; or

(ii) A lump sum on the last day of the Plan Year during which the Member
reaches age 65 (regardless of whether or not the Member has Terminated); or

(iii) Annual installments of up to 20 years, as designated by the Member on
his or her Enrollment Form, beginning within 60 days after the date that the
Member Terminates.

(iv) Annual installments of up to 20 years, as designated by the Member on
his or her Enrollment Form, beginning on the last day of the Plan Year
during which the Member reaches age 65 (regardless of whether or not the
Member has Terminated).

If a Member elects annual installments under this Section 6.01(2)(b), (I) the first
distribution will equal the value of the Section 409A Amounts in the Member’s
Account as of the most recent Valuation Date divided by the number of annual
installments elected, and (II) each distribution thereafter will be made on the
anniversary of the initial distribution date and will equal the balance of the
Section 409A Amounts in the Member’s Account as of the most recent Valuation Date
divided by the number of remaining annual installments.

13

 

(3) Elections Relating to Benefit Form. To elect an optional benefit form or change
a benefit form under this Section 6.05 effectively, a Member must file a written or
electronic election with the Committee at the times and in the manner described in this
Section 6.05(3).

(a) Newly Eligible Participants. A newly eligible Participant may make an
election under this Section 6.05 by submitting an Enrollment Form as described in
Section 3.01(2).

(b) Grandfathered Amounts. With respect to Grandfathered Amounts:

(i) An election to receive an optional benefit form must be made on a form
prescribed by the Committee and must be delivered to the Committee no fewer
than 12 months before such election is to be effective.

(ii) An election to receive an optional benefit form may be revoked if the
electing Member files a written or electronic election with the Committee no
fewer than 12 months before the benefit otherwise would have been
distributed in the optional benefit form previously elected. This
revocation must be made on a form prescribed by the Committee.

(iii) Any election to receive payment in an optional form (or any revocation
of an election to do so) will be disregarded unless the Member strictly
complies with the procedures described in this Section 6.05(3)(b).

(c) Section 409A Amounts. With respect to Section 409A Amounts, a Member
will be permitted to change the time and form of payment if such change meets the
following requirements:

(i) A Member may change the time and form of payment for any Section 409A
Amounts (based on the choices available under Section 6.05(2)) by filing a
new election form with the Committee; provided that such change meets the
following requirements: (A) the subsequent election may not take effect
until at least 12 months after the date on which such election is made; (B)
the payment with respect to which such election is made must be deferred
(other than a distribution upon death or Disability) for a period of not
less than five years from the date such payment would otherwise have been
paid; and (C) any subsequent election affecting a distribution at a
specified time (or pursuant to a fixed schedule) may not be made less than
12 months before the date the payment is scheduled to be paid. A subsequent
election may be changed at any time before the last permissible date for
making such election, as described in this Section 6.05(3)(c).

(ii) Once the distribution of an Account begins, no changes to the Member’s
benefit form will be permitted.

14

 

(4) Distribution Delay for Specified Employees. Notwithstanding anything in this
Plan to the contrary, in the case of any Member who is a Specified Employee as of the date
of his or her Termination, any Section 409A Amount due to the Member under the Plan in
connection with such Termination will not be distributed for a period of six months after
the date of such Termination or, if earlier, the date of the Specified Employee’s death (the
“Distribution Delay Period”). If the Distribution Delay Period applies to a Member, each
payment of Section 409A Amounts to which the Member is
entitled under the Plan in connection with the Member’s Termination shall be delayed for six
months.

(5) Limited Cashout. Notwithstanding anything in this Section 6.00 to the contrary,
the Corporation, in its sole discretion, may make a lump sum distribution of a Member’s
Account under the Plan if: (a) the distribution results in the termination and liquidation
of the entirety of the Member’s interest under the Plan and all agreements, methods,
programs or other arrangements with respect to which deferrals of compensation are treated
as having been deferred under a single nonqualified deferred compensation plan under
Treasury Regulation §1.409A-1(c)(2); and (b) the aggregate distribution under the
arrangements is not greater than the applicable dollar amount under Code §402(g)(1)(B).

(6) No Further Liability. Once a Member’s Account has been fully distributed, the
Corporation, all Employers, all Group Members, the Committee and the Plan will have no
further liability to the Member or, if appropriate, to his or her Beneficiary.

SECTION 7.00 PLAN COMMITTEE

7.01 Appointment of Committee. The Board will appoint a committee to administer the Plan. A
Committee member may resign at any time by sending written notice to the Board specifying the
effective date of his or her termination (which must always be prospective). Vacancies in the
Committee will be filled by the Board as the need arises. Also, in its sole discretion, the Board
may remove any Committee member at any time by giving written notice of removal to the affected
Committee member and specifying the effective date of that action (which must always be
prospective).

7.02 Powers and Duties. The Committee is fully empowered to exercise complete discretion to
administer the Plan and to construe and apply all of its provisions. The Committee may delegate
any of its powers and duties to any other person or organization. These powers and duties include:

(1) Deciding which employees are Eligible Employees, which of them may participate in the
Plan and the value of their benefit;

(2) Resolving disputes that may arise with regard to the rights of Eligible Employees,
Members and their legal representatives or Beneficiaries under the terms of the Plan.
Subject to Sections 7.08 and 7.09, the Committee’s decisions in these matters will be final;

15

 

(3) Obtaining from each Group Member, Member and Beneficiary information that the Committee
needs to determine any Member’s or Beneficiary’s rights and benefits under the Plan. The
Committee may rely conclusively upon any information furnished by a Group Member, Member or
Beneficiary;

(4) Compiling and maintaining all records it needs to administer the Plan;

(5) Upon request, furnishing each Group Member with reasonable and appropriate reports of
its administration of the Plan;

(6) Engaging legal, administrative, actuarial, investment, accounting, consulting and other
professional services that the Committee believes are necessary and appropriate;

(7) Adopting rules and regulations for the administration of the Plan that are not
inconsistent with the terms of the Plan; and

(8) Doing and performing any other acts provided for in the Plan.

7.03 Actions by the Committee. The Committee may act at a meeting, or in writing without a
meeting, by the vote or assent of a majority of its members. The Committee will appoint one of its
members to act as a secretary to record all Committee actions. The Committee also may authorize
one or more of its members to execute papers and perform other ministerial duties on behalf of the
Committee.

7.04 Interested Committee Members. No member of the Committee may participate in any Committee
action that directly affects that Committee member’s individual interest in the Plan. These
matters will be determined by a majority of the remainder of the Committee.

7.05 Indemnification.

(1) The Corporation will indemnify and hold harmless any Committee member or employee who
performs services to or on behalf of the Plan (“Indemnified Party”) against all liabilities
and all reasonable expenses (including attorney fees and amounts paid in settlement other
than to any Group Member) incurred or paid in connection with any threatened or pending
action, suit or proceeding brought by any party in connection with the Plan. However, this
indemnification will not extend to any Indemnified Party whose conduct in connection with
the Plan is found to have been grossly negligent or wrongful. This determination will be
based on any final judgment rendered in connection with the action, suit or proceeding
complaining of the conduct or its effect or, if no final judgment is rendered, by a majority
of the Board or by independent counsel to whom the Board has referred the matter.

(2) The obligations under this section may be satisfied, in the Corporation’s discretion,
through the purchase of a policy or policies of insurance providing equivalent protection.

16

 

7.06 Conclusiveness of Action. Subject to Sections 7.08 and 7.09, any action on matters within the
discretion of the Committee will be conclusive, final and binding upon all Members and upon all
persons claiming any rights under the Plan, including Beneficiaries.

7.07 Payment of Expenses.

(1) Committee members will not be separately compensated for their services relating to the
Plan. However, the Corporation will reimburse Committee members for all appropriate
expenses they incur while carrying out their Plan duties.

(2) The compensation or fees of accountants, counsel and other specialists and any other
costs of administering the Plan will be paid by the Corporation or allocated among
Employers.

7.08 Claims Procedure.

(1) Any Member or Beneficiary (“claimant”) who believes that he or she is entitled to an
unpaid Plan benefit may file a claim with the Committee. By accepting participation in the
Plan, each Member expressly waives any right to proceed under Section 7.09 unless and until
the administrative remedies described in this Section 7.08 are fully exhausted.

(2) If the claim is wholly or partially denied, the Committee will, within a reasonable
period of time, and within 90 days of the receipt of such claim, or if the claim is a claim
on account of Disability, within 45 days of the receipt of such claim, provide the claimant
with written notice of the denial setting forth in a manner calculated to be understood by
the claimant:

(a) The specific reason or reasons for which the claim was denied;

(b) Specific reference to pertinent Plan provisions, rules, procedures or protocols
upon which the Committee relied to deny the claim;

(c) A description of any additional material or information that the claimant may
file to perfect the claim and an explanation of why this material or information is
necessary;

(d) An explanation of the Plan’s claims review procedure and the time limits
applicable to such procedure and a statement of the claimant’s right to bring a
civil action under ERISA §502(a) following an adverse determination upon review; and

(e) In the case of an adverse determination of a claim on account of Disability, the
information to the claimant shall include, to the extent necessary, the information
set forth in Department of Labor Regulation 2560.503-1(g)(1)(v).

If the special circumstances require the extension of the 45-day or 90-day period described
above, the claimant will be notified before the end of the initial period of the

17

 

circumstances requiring the extension and the date by which the Committee expects to reach a
decision. Any extension for deciding a claim will not be for more than an additional 90-day
period, or if the claim is on account of Disability, for not more than two additional 30-day
periods.

(3) If a claim has been wholly or partially denied, the affected claimant, or his or her
authorized representative may:

(a) Request that the Committee reconsider its initial denial by filing a written
appeal within 60 days after receiving written notice that all or part of the initial
claim was denied (180 days in the case of a denial of a claim on account of
Disability);

(b) Review pertinent documents and other material upon which the Committee relied
when denying the initial claim; and

(c) Submit a written description of the reasons for which the claimant disagrees
with the Committee’s initial adverse decision.

An appeal of an initial denial of benefits and all supporting material must be made in
writing and directed to the Committee. The Committee is solely responsible for reviewing
all benefit claims and appeals and taking all appropriate steps to implement its decision.

The Committee’s decision on review will be sent to the claimant in writing and will include
specific reasons for the decision, written in a manner calculated to be understood by the
claimant, as well as specific references to the pertinent Plan provisions, rules, procedures
or protocols upon which the Committee relied to deny the appeal. The Committee will
consider all information submitted by the claimant, regardless of whether the information
was part of the original claim. The decision will also include a statement of the
claimant’s right to bring an action under ERISA §502(a).

The Committee’s decision on review will be made not later than 60 days (45 days in the case
of a claim on account of Disability) after the Committee’s receipt of the request for
review, unless special circumstances require an extension of time for processing, in which
case a decision will be rendered as soon as possible, but not later than 120 days (90 days
in the case of a claim on account of Disability) after receipt of the request for review.
This notice to the claimant will indicate the special circumstances requiring the extension
and the date by which the Committee expects to render a decision and will be provided to the
claimant prior to the expiration of the initial 45-day or 60-day period.

Notwithstanding anything in this Section 7.08 to the contrary, in the case of a claim on
account of Disability: (1) the review of the denied claim shall be conducted by a named
fiduciary who is (a) determined by the Committee and (b) neither the individual who made the
benefit determination nor a subordinate of such person; and (2) no deference shall be given
to the initial benefit determination. For issues involving medical judgment, the Committee
(or, if applicable, the named fiduciary) must consult with an

18

 

independent health care
professional who may not be the health care professional who decided the initial claim.

To the extent permitted by law, the decision of the Committee (if no review is properly
requested) or the decision of the Committee (or, if applicable, the named fiduciary) on
review, as the case may be, will be final and binding on all parties. No legal action for
benefits under the Plan will be brought unless and until the claimant has exhausted his or
her remedies under this section.

7.09 Arbitration. Binding arbitration will be the exclusive means of resolving all disputes or
questions not resolved to the claimant’s satisfaction through the claims procedure described in
Section 7.08.

(1) After exhausting the procedures described in Section 7.08, the claimant may initiate
arbitration by giving written notice to the Committee specifying the subject of the
requested arbitration.

(2) The arbitration will take place in the city in which the affected Member’s last
principal place of employment with a Group Member is or was located (or another location
mutually agreed upon by the claimant and the Committee) and will be conducted in accordance
with the rules of the American Arbitration Association in effect when the arbitration begins
by three arbitrators, one appointed by each party and a third appointed by those two
arbitrators. The Committee and the claimant (in his or her own behalf and on behalf of all
other claimants) each waive any right to a jury trial with respect to any matter arising
from this Plan.

(3) Any determination or award made or approved by the arbitrator will be final and binding
on the claimant and all Group Members. Judgment upon any award made in any arbitration may
be entered and enforced in any court having competent jurisdiction.

(4) The arbitrators will have no authority to add to, alter, amend or refuse to enforce any
portion of this Plan or to award punitive damages against any Group Member or the claimant.

(5) The costs of arbitration (including legal and other professional fees incurred) will be
borne solely by the party to the arbitration by which they are incurred regardless of the
result of the arbitration.

SECTION 8.00 AMENDMENT TO THE PLAN

8.01 Right to Amend. The Corporation may modify, alter or amend the Plan at any time. However, no
amendment may affect any Member’s or Beneficiary’s vested rights accrued under the Plan before the
effective date of that amendment without such Member’s or, if applicable, Beneficiary’s consent.
If an amendment heightens the vesting conditions described in Section 6.04, each affected Member
who has completed Valuation Periods comprised of at least 36 months may elect to have his or her
vested rights computed without regard to that amendment, but only if the Member files a written
election to this effect with the Committee during the period beginning on the date the amendment is
adopted and ending on the later of [1] 60 days

19

 

after the date the amendment is adopted [2] 60 days
after the amendment is effective or [3] 60 days after the Member is issued a written notice of the
amendment.

8.02 Amendment Procedure. The Board, an executive committee of the Board or other Board committee
or any executive officer to which or to whom the Board delegates discretionary authority over the
Plan may exercise the Corporation’s right to amend the Plan.

SECTION 9.00 TERMINATION OF THE PLAN

9.01 Right to Terminate.

(1) The Corporation may terminate the Plan in whole or in part at any time by written action
of the Board. Each Member affected by a full or partial Plan termination or by a complete
discontinuance of contributions will be 100 percent vested in the value of his or her
Account as of the date of that action.

(2) The Committee may (a) distribute an affected Member’s Grandfathered Amounts at the time
the Plan terminates or partially terminates, even if this date is earlier than the date
benefits otherwise would be distributed under Section 6.05 or (b) hold the Member’s
Grandfathered Amounts until they are otherwise payable under the terms of the Plan.

(3) In the event of a termination of the Plan, except as permitted under Treasury
Regulation §1.409A-3(j)(4)(ix), no Section 409A Amounts shall be distributed until they are
otherwise payable under the terms of the Plan.

9.02 Plan Merger and Consolidation. If the Plan is merged into or consolidated with any other
plan, each affected Member will be entitled to a benefit immediately after the merger,
consolidation or transfer (determined as if the surviving plan had then terminated) at least equal
to the benefit he or she had accrued immediately before the merger or consolidation (determined as
if the Plan terminated immediately before that merger or consolidation).

9.03 Successor Employer. If any Employer dissolves into, reorganizes, merges into or consolidates
with another business entity, provision may be made by which the successor will continue the Plan,
in which case the successor will be substituted for the Employer under the terms and provisions of
this Plan. The substitution of the successor for the Employer will constitute an assumption by the
successor of all Plan liabilities and the successor will have all of the powers, duties and
responsibilities of the Employer under the Plan.

SECTION 10.00 UNFUNDED PLAN

Notwithstanding any Plan provision to the contrary, the Plan constitutes an unfunded, unsecured
promise by each Employer to pay only those benefits that are accrued by Members under the terms of
the Plan. Neither the Corporation nor any Group Member will segregate any assets into a fund
established exclusively to pay Plan benefits unless the Corporation, in its sole discretion,
establishes a trust for the purpose of holding assets from which all or part of a Plan benefit may
be paid. Neither the Corporation nor any other Group Member is liable for the payment of Plan
benefits that are actually paid from a trust established for that purpose. However, the
Corporation and each other Group Member are obliged to pay any benefits not paid from
any

20

 

trust.
Also, Members, Beneficiaries and other persons claiming a Plan benefit through them have only the
rights of general unsecured creditors and do not have any interest in or right to any specific
asset of any Group Member. Nothing in this Plan constitutes a guaranty by the Corporation, any
other Group Member or any other entity or person that their assets will be sufficient to pay Plan
benefits.

SECTION 11.00 MISCELLANEOUS

11.01 Voluntary Plan. The Plan is purely voluntary on the part of each Employer. None of the
establishment of the Plan, any amendment to it, the creation of any fund or account or the payment
of any benefits may be construed as giving any person (1) a legal or equitable right against any
Group Member or the Committee other than those specifically granted under the Plan or conferred by
affirmative action of the Committee or any Employer in a manner that is consistent with the terms
and provisions of this Plan or (2) the right to be retained in the service of any Group Member.
All Members remain subject to discharge to the same extent as though this Plan had not been
established.

11.02 Non-alienation of Benefits. The right of a Member, Beneficiary or any other person to
receive Plan benefits may not be assigned, transferred, pledged or encumbered except as provided in
the Member’s Beneficiary designation, by will or by applicable laws of descent and distribution.
Any attempt to assign, transfer, pledge or encumber a Plan benefit will be null and void and of no
legal effect.

11.03 Inability to Receive Benefits. Any Plan benefit payable to a Member or Beneficiary who is
declared incompetent will be paid to the guardian, conservator or other person legally charged with
the care of his or her person or estate. Any payment made under this section will completely
discharge the Plan’s liability with respect to that payment. The Committee is not required to see
to the application of any distribution made to any person.

11.04 Lost Members. Each Member is obliged to keep the Committee apprised of his or her current
mailing address and that of his or her Beneficiary. The Committee’s obligation to search for any
Member or Beneficiary is limited to sending a registered or certified letter to the Member’s or
Beneficiary’s last known address.

11.05 Limitation of Rights. Nothing in the Plan, expressed or implied, is intended or may be
construed as conferring upon or giving to any person, firm or association (other than Group
Members, Members, their Beneficiaries and their successors in interest) any right, remedy or claim
under or by reason of this Plan.

11.06 Invalid Provision. If any provision of this Plan is held to be illegal or invalid for any
reason, the Plan will be construed and enforced as if the offending provision had not been included
in the Plan. However, that determination will not affect the legality or validity of the remaining
parts of this Plan.

11.07 One Plan. This Plan may be executed in any number of counterparts, each of which will be
deemed to be an original.

21

 

11.08 Governing Law. The Plan will be governed by and construed in accordance with the laws of the
United States and, to the extent applicable, the laws of Ohio.

11.09 Code §409A.

(1) It is intended that the Plan comply with Code §409A and the Treasury Regulations
promulgated thereunder (and any subsequent IRS notices or guidance), and this Plan will be
interpreted, administered and operated accordingly. Nothing herein shall be construed as an
entitlement to or guarantee of any particular tax treatment to a Member.

(2) The Corporation may accelerate the time or schedule of a distribution of Section 409A
Amounts to a Member at any time the Plan fails to meet the requirements of Code §409A and
the Treasury Regulations promulgated thereunder. Such payment may not exceed the amount
required to be included in income as a result of the failure to comply with Code §409A and
the Treasury Regulations promulgated thereunder.

(3) Notwithstanding any terms of the Plan to the contrary, a Member shall be allowed to make
changes to the time and/or form of distribution of the Member’s Section 409A Amounts in
calendar year 2008, as permitted by the transition relief provided in IRS Notice 2007-86.

22EX-10.6

 

Exhibit
10.6

BOB EVANS FARMS, INC. 1998 STOCK OPTION AND INCENTIVE PLAN

SECOND AMENDED AND RESTATED

(Effective as of January 1, 2008)

          l. Purpose. The purpose of the Bob Evans Farms, Inc. Second Amended and Restated 1998 Stock
Option and Incentive Plan (the “Plan”) is to foster and promote the long-term success of Bob Evans
Farms, Inc. (the “Company”) and materially increase stockholder value by (a) motivating superior
performance by means of performance-related incentives, (b) encouraging and providing for the
acquisition of an ownership interest in the Company by the directors and officers and other key
employees of the Company and its Subsidiaries and (c) enabling the Company to attract and retain
the services of an outstanding
management team upon whose judgment, interest and special effort the successful conduct of the
operations of the Company is largely dependent.

          2. Administration. The Plan will be administered by a committee (the “Committee”) of at least
three persons who shall be either the Compensation Committee of the Board of Directors of the
Company or such other committee comprised entirely of “outside directors” within the meaning of
Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), and the regulations
and rulings thereunder, as the Committee may from time to time select. The Committee shall
interpret the Plan; prescribe, amend and rescind rules and regulations relating thereto; and make
all other determinations necessary or advisable for the administration of the Plan. Any
determination, decision or action of the Committee in connection with the construction,
interpretation, administration or application of the Plan shall be final, conclusive and binding
upon all persons participating in the Plan and any person validly claiming under or through persons
participating in the Plan. A majority of the members of the Committee shall constitute a quorum at
any meeting of the Committee, and all determinations of the Committee at a meeting shall be made by
a majority of its members. Any determination of the Committee under the Plan may be made without a
meeting of the Committee by a writing signed by all of its members. No member of the Board of
Directors of the Company or of the Committee shall be liable for any action or determination made
in good faith, with respect to the Plan or any Award granted under the Plan. The Company shall
effect the granting of Awards under the Plan in accordance with the determination of the Committee,
by execution of instruments in writing in such form as approved by the Committee.

          With respect to persons subject to Section 16 of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), transactions under the Plan are intended to comply with all
applicable conditions of Rule l6b-3 under the Exchange Act, or any successor rule or regulation.
To the extent any provision of the Plan or action by the Committee fails to so comply, it shall be
deemed null and void, to the extent permitted by law and deemed advisable by the Committee.

          3. Participants. Participants in the Plan will consist of the directors and officers and other
key employees of the Company or any of its Subsidiaries, as the Committee in its sole discretion
may designate from time to time to receive Awards hereunder (the “Participants”). The Committee’s
designation of a Participant in any year shall not require the

 

 

Committee to designate such person
to receive an Award in any other year. The Committee shall consider such factors as it deems
pertinent in selecting Participants and in determining the type and amount of their respective
Awards, including, without limitation: (a) the financial condition of the Company and its
Subsidiaries; (b) anticipated profits for the current or future years; (c) contributions of
Participants to the profitability and development of the Company and its Subsidiaries; and (d)
other compensation provided to Participants. During any calendar year, no Participant shall be
granted Awards under this Plan covering, in the aggregate, more than Three Hundred Thousand
(300,000) Common Shares and no Participant shall be granted stock options covering, in the
aggregate, more than Two Hundred and Fifty Thousand (250,000) Common Shares.

          4. Types of Awards. Awards under the Plan may be granted in any one or a combination of: (a)
Incentive Stock Options; (b) Non-Qualified Stock Options; (c) Stock
Appreciation Rights; (d) Performance Share Awards; and (e) Restricted Stock, all as described below
in Sections 6, 7, 8, 9 and 10 hereof. Notwithstanding the foregoing, no Stock Appreciation Rights
or Performance Share Awards have been granted under the Plan through December 31, 2007, and no
further Awards may be granted under the Plan after September 11, 2006.

          5. Common Shares Reserved Under the Plan. There is hereby reserved for issuance under the
Plan an aggregate of Five Million (5,000,000) Common Shares, which may be newly issued or treasury
shares. If there is a lapse, expiration, termination or cancellation of any Award granted
hereunder without the issuance of Common Shares or payment of cash thereunder, or if Common Shares
are issued under any Award and thereafter are reacquired by the Company pursuant to rights reserved
upon the issuance thereof, the Common Shares subject to or reserved for such Award may again be
used for new Stock Options or other Awards under the Plan so long as the holder thereof has not
received any benefits of ownership of such Common Shares; provided, however, that in no event may
the number of Common Shares issued under the Plan exceed the total number of Common Shares reserved
for issuance hereunder.

          6. Incentive Stock Options. Incentive Stock Options will consist of Stock Options, qualifying
as “incentive stock options” under the requirements of Section 422 of the Code, to purchase Common
Shares at purchase prices of not less than One Hundred Percent (100%) of the Fair Market Value of
such Common Shares on the date of grant. Incentive Stock Options will only be eligible for grant
to employees of the Company. Incentive Stock Options will be exercisable over not more than ten
(10) years after the date of grant. In the event of the termination of a Participant’s employment
for any reason other than Disability, death, Retirement or for Cause, the right of the Participant
to exercise an Incentive Stock Option shall terminate upon the earlier to occur of the end of the
original term of the Incentive Stock Option or ninety (90) days after the date of such termination
of employment. In the event that a Participant is Terminated for Cause, the right of the
Participant to exercise an Incentive Stock Option shall terminate immediately upon the termination
of employment. In the event of the termination of a Participant’s employment due to Disability,
the right of the Participant (or, in the case of the death of the Participant after his or her
termination of employment due to Disability, his or her successor in interest) to exercise an
Incentive Stock Option shall terminate upon the earlier to occur of (i) the end of the original
term of the Incentive Stock Option or (ii) one (l) year after the

-2-

 

date of termination of
employment. If a Participant should die while employed, the right of the Participant’s successor
in interest to exercise an Incentive Stock Option granted to the Participant shall terminate upon
the earlier to occur of (i) the end of the original term of the Incentive Stock Option or (ii) one
year after the Participant’s last date of employment. Upon Retirement of a Participant, the right
of the Participant (or, in the case of the death of the Participant after his or her termination of
employment due to Retirement, his or her successor in interest) to exercise an Incentive Stock
Option shall terminate upon the earlier of (i) ninety (90) days after the date of such Retirement
or (ii) the end of the original term of the Incentive Stock Option; provided, however, that if the
Participant or his or her successor in interest does not exercise the Incentive Stock Option within
ninety (90) days after the date of such Retirement, the Incentive Stock Option shall automatically
convert into a Non-Qualified Stock Option upon the end of such ninety (90) day period and the
Participant’s or his or her successor in interest’s right to exercise such converted Non-Qualified
Stock Option shall terminate at the end of the original term of the
option. For purposes of this Section 6, if a Participant terminates his or her employment
voluntarily, the date of termination of employment shall be deemed to be the date on which he or
she notifies the Company of his or her intention to terminate his or her employment; in all other
cases, the date of termination of employment shall be the last day of employment.

          The aggregate Fair Market Value (determined as of the time the Stock Option is granted) of the
Common Shares with respect to which incentive stock options are exercisable for the first time by
any Participant during any calendar year (under all option plans of the Company and all
Subsidiaries and Parents of the Company) shall not exceed $100,000. Anything contained herein to
the contrary notwithstanding, no Incentive Stock Option shall be granted to an employee who, at the
time the Incentive Stock Option is granted, owns (actually or constructively under the provisions
of Section 424(d) of the Code) stock possessing more than 10% of the total combined voting power of
all classes of stock of the Company or of any Parent or Subsidiary of the Company, unless the
option exercise price is not less than 110% of the Fair Market Value of the Common Shares subject
to the Incentive Stock Option on the date of grant and the Incentive Stock Option by its terms is
not exercisable more than five (5) years from the date it is granted.

          7. Non-Qualified Stock Options. Non-Qualified Stock Options will consist of options to
purchase Common Shares at purchase prices of not less than One Hundred Percent (100%) of the Fair
Market Value of such Common Shares on the date of grant and with terms as determined by the
Committee in its discretion. In the event of the termination of a Participant’s employment or
service as a director for any reason other than Retirement, Disability, death or for Cause, the
right of the Participant to exercise a Non-Qualified Stock Option shall terminate upon the earlier
to occur of the end of the original term of the Non-Qualified Stock Option or ninety (90) days
after the date of such termination of employment or service. If a Participant is Terminated for
Cause, the right of the Participant to exercise a Non-Qualified Stock Option shall terminate
immediately upon the termination of employment or service. In the event of the termination of a
Participant’s employment or service due to Disability or death, the right of the Participant or his
or her successor in interest to exercise a Non-Qualified Stock Option shall terminate upon the
earlier to occur of (i) the end of the original term of the Non-Qualified Stock Option or (ii) one
(l) year after the date of termination of employment or service as a result of such Disability or
death. In the event of the termination of a Participant’s employment or service due to Retirement,
the right of the Participant (or, in the case of the death of the Participant after

-3-

 

his or her
termination of employment or service due to Retirement, his or her successor in interest) to
exercise a Non-Qualified Stock Option shall terminate upon the end of the original term of the
Non-Qualified Stock Option. For purposes of this Section 7, if a Participant terminates his or her
employment or service voluntarily, the date of termination of employment or service shall be deemed
to be the date on which he or she notifies the Company of his or her intention to terminate his or
her employment or service; in all other cases, the date of termination of employment or service
shall be the last day of employment or service.

          8. Stock Appreciation Rights. The Committee may grant Stock Appreciation Rights to
Participants at the same time as such Participants are awarded Stock Options under the Plan. Such
Stock Appreciation Rights shall be evidenced by an agreement in such form as the Committee shall
from time to time approve. Such agreements shall comply with, and be subject to, the following
terms and conditions:

               (a) Grant. Each Stock Appreciation Right shall relate to a specific Stock Option under the
Plan and shall be awarded to a Participant concurrently with the grant of such Stock Option. The
number of Stock Appreciation Rights granted to a Participant shall be equal to a proportion of the
number of Common Shares that the Participant is entitled to receive pursuant to the Plan.

               (b) Grant of Parallel Award. Since each Stock Appreciation Right is parallel to a Stock
Option, the exercise of all or a portion of the Stock Options shall cause an equal exercise of the
same proportion of Stock Appreciation Rights granted under the Plan. A Stock Appreciation Right
can only be exercisable in conjunction with the exercise of the parallel Stock Option.

               (c) Calculation of Appreciation. Each Stock Appreciation Right shall entitle a
Participant to the excess of the Fair Market Value of a Common Share on the exercise date over the
Fair Market Value of a Common Share on the date the Stock Appreciation Right was granted.

               (d) Payment of Appreciation. The total appreciation available to a Participant from an
exercise of Stock Appreciation Rights shall be paid in a manner determined by the Committee.

               (e) Exercise Limitations. A Participant may exercise a Stock Appreciation Right only in
conjunction with the exercise of the Stock Option to which the Stock Appreciation Right is
attached. Stock Appreciation Rights may be exercised only at such times and by such persons as may
exercise Stock Options under the Plan.

          9. Performance Share Awards. The Committee may grant awards under which payment may be made
in Common Shares, cash or any combination of Common Shares and cash if the performance of the
Company or any Subsidiary selected by the Committee during the Performance Period meets certain
goals established by the Committee (“Performance Share Awards”). Such Performance Share Awards
shall be subject to the following terms and conditions and such other terms and conditions as the
Committee may prescribe:

-4-

 

               (a) Performance Period and Performance Goals. The Committee shall determine and include in a
Performance Share Award grant the period of time for which a Performance Share Award is made
(“Performance Period”). The Committee shall also establish performance objectives (“Performance
Goals”) to be met by the Company or Subsidiary during the Performance Period as a condition to
payment of the Performance Share Award. The Performance Goals may include earnings per share,
return on stockholders’ equity, return on assets, net income or any other financial or other
measure established by the Committee. The Performance Goals may include minimum and optimum
objectives or a single set of objectives.

               (b) Payment of Performance Share Awards. The Committee shall establish the method of
calculating the amount of payment to be made under a Performance Share Award if the Performance
Goals are met, including the fixing of a maximum payment. The Performance Share Award shall be
expressed in terms of Common Shares and referred to as “Performance Shares.” After the completion
of a Performance Period, the performance of the
Company or Subsidiary shall be measured against the Performance Goals, and the Committee shall
determine whether all, none or any portion of a Performance Share Award shall be paid. Any such
payment shall be made as soon as administratively feasible after the Committee’s determination (but
no later than the 15th day of the third month following the last day of the Performance Period).
The Committee, in its discretion, may elect to make payment in Common Shares, cash or a combination
of Common Shares and cash. Any cash payment shall be based on the Fair Market Value of the
underlying Common Shares on, or as soon as practicable prior to, the date of payment.

               (c) Revision of Performance Goals. At any time prior to the end of a Performance Period, the
Committee may revise the Performance Goals and the computation of payment if unforeseen events
occur which have a substantial effect on the performance of the Company or Subsidiary and which in
the judgment of the Committee make the application of the Performance Goals unfair unless a
revision is made.

               (d) Requirement of Employment. A Participant who receives a Performance Share Award must
remain in the employment of the Company or Subsidiary or remain in the service of the Company or
Subsidiary as a director until the completion of the Performance Period in order to be entitled to
payment under the Performance Share Award; provided that the Committee may, in its sole discretion,
provide for a partial payment (in accordance with the requirements of Section 9(b) above) where
such an exception is deemed equitable.

               (e) Compliance With Code Section 162(m). Any Performance Share Awards granted under this Plan
shall satisfy the requirements of the applicable provisions of Section 162(m) of the Code as
“qualified performance-based compensation.”

          10. Restricted Stock Awards. To the extent not inconsistent with the terms of this Plan, the
Committee may grant Restricted Stock Awards to Participants. Restricted Stock Awards will consist
of Common Shares transferred to a Participant who is eligible to participate in the Plan without
other payment therefor (other than the payment of the par value of such Common Shares if required
by applicable law) as additional compensation for his or her services to the Company or one of its
Subsidiaries. Restricted Stock Awards shall be subject to such

-5-

 

terms and conditions as the
Committee determines appropriate including, without limitation, restrictions on the sale or other
disposition of such Common Shares and rights of the Company to reacquire such Common Shares upon
termination of the Participant’s employment or service as a director with the Company within
specified periods. Subject to such other restrictions as are imposed by the Committee and federal
and state securities laws, the Common Shares covered by a Restricted Stock Award granted to a
Participant under the Plan may be sold or otherwise disposed of only after six (6) months from the
grant date of the Award.

          11. Nontransferability. Each Stock Option, Performance Share Award and Restricted Stock Award
granted under this Plan shall not be transferable other than by will or the laws of descent and
distribution, and Stock Options shall be exercisable, during the Participant’s lifetime, only by
the Participant or the Participant’s guardian or legal representative.

          12. Other Provisions. The grant of any Award under the Plan may also be subject to such other
provisions (whether or not applicable to any Award granted to any other Participant) as the
Committee determines appropriate including, without limitation, provisions for the purchase of
Common Shares under Stock Options in installments, provisions for the payment of the option
exercise price of Common Shares under a Stock Option by delivery of other Common Shares of the
Company having a then Fair Market Value equal to the option exercise price of such Common Shares,
restrictions on resale or other disposition, such provisions as may be appropriate to comply with
federal or state securities laws and stock exchange requirements and understandings or conditions
as to the Participant’s employment or service as a director in addition to those specifically
provided for under the Plan. If the Committee does not specify another exercise schedule at the
time of grant, the number of Common Shares under each Stock Option which may be purchased in any
one year ending on an anniversary date of the grant of the Stock Option shall be the total number
of Common Shares subject to the Stock Option divided by the number of years constituting the term
of the Stock Option; provided, however, that if a Participant does not purchase in any one option
year the full number of Common Shares to which he or she is then entitled, the Participant may
purchase those Common Shares in any subsequent year during the term of the Stock Option.

          The Committee may, in its discretion, permit payment of the option exercise price of Common
Shares under Stock Options by delivery of a properly executed exercise notice together with a copy
of irrevocable instructions to a broker to deliver promptly to the Company the amount of sale or
loan proceeds to pay the option exercise price. To facilitate the foregoing, the Company may enter
into agreements for coordinated procedures with one or more brokerage firms.

          The Committee may, in its discretion and subject to such rules as it may adopt, permit a
Participant to pay all or a portion of the federal, state and local taxes, including FICA
withholding tax, arising in connection with the following transactions: (a) the exercise of a
Non-Qualified Stock Option; or (b) the receipt or exercise of any other Award by electing (i) to
have the Company withhold Common Shares, (ii) to tender back Common Shares received in connection
with such Award or (iii) to deliver other previously acquired Common Shares of the Company having a
Fair Market Value approximately equal to the amount to be withheld.

-6-

 

          13. Term of the Plan and Amendment, Modification, Cancellation or Acceleration of Awards. No
Award shall be granted under the Plan more than ten (10) years after the date of the adoption of
the Plan by the Company’s Board of Directors. The terms and conditions applicable to any Award
granted prior to such date may at any time be amended, modified or canceled, without stockholder
approval, by mutual agreement between the Committee and the Participant or such other persons as
may then have an interest therein, so long as stockholder approval of such amendment, modification
or cancellation is not required under Rule l6b-3 under the Exchange Act or any applicable
requirements of any securities exchange on which are listed any of the Company’s equity securities
or any applicable requirements for issuers whose securities are traded in the NASDAQ National
Market System or any applicable requirements of the Code. The Committee may, at any time and in
its sole discretion, declare any or all Stock Options then outstanding under this Plan to be
exercisable, whether or not such Stock Options are then otherwise exercisable.

          l4. Taxes. The Company shall be entitled to withhold the amount of any tax attributable to
any amount payable or Common Shares deliverable under the Plan after giving the person entitled to
receive such amount or Common Shares notice as far in advance as practicable.

          l5. Definitions.

               (a) Award. The term “Award” means an award or grant of a Stock Option, Stock Appreciation
Right, Performance Share or Restricted Stock made to a Participant under Section 6, 7, 8, 9 or 10
of the Plan.

(b) Change in Control. A “Change in Control” shall be deemed to have
occurred:

                    (i) With respect to a Participant who is a party to a change in control
agreement and to which the Company also is a party (“Change Agreement”), a
“change in control” occurs as defined in (and subject to the terms of) that
Participant’s Change Agreement; and

                    (ii) With respect to all Participants, approval by the Company’s
stockholders of a definitive agreement (A) to merge or consolidate the
Company with or into another corporation in which the Company is not the
continuing or surviving corporation or pursuant to which any Common Shares
would be converted into cash, securities or other property of another
corporation, other than a merger of the Company in which holders of Common
Shares immediately before the merger have the same proportionate ownership
of shares of the surviving corporation immediately after the merger as
immediately before or (B) within a 12-consecutive-calendar-month period, to
sell or otherwise dispose of 50 percent or more of the book value of the
combined assets of the Company and all Subsidiaries. For purposes of this
definition, (A) “book value” will be established on the basis of the latest
consolidated financial statement the Company filed with the Securities and
Exchange Commission before the

-7-

 

date any 12-consecutive-calendar month
measurement period began and (B) “related entity” means (I) an entity
related to the Company by application of Sections 414(b) and (c) of the
Code, as modified by Section 414(h) of the Code or (II) an affiliated
service group [as defined in Section 414(m) of the Code] or other
organization described in Section 414(o) of the Code that includes the
Company.

               (c) Code. “Code” means the Internal Revenue Code of 1986, as amended, and the regulations and
rulings thereunder. References to a particular section of the Code shall include references to
successor provisions.

               (d) Committee. The “Committee” means the Committee of the Board of Directors of the Company
constituted as provided in Section 2 hereof.

               (e) Common Shares. “Common Shares” means the shares of Common Stock, par value $0.01 per
share, of the Company or any security of the Company issued in substitution, exchange or lieu
thereof.

               (f) Company. The “Company” means Bob Evans Farms, Inc., a Delaware corporation, or any
successor corporation.

               (g) Disability. The term “Disability” means, as it relates to the exercise of an Incentive
Stock Option after termination of employment, a disability within the meaning of Section 22(e)(3)
of the Code, and for all other purposes, a mental or physical condition which, in the opinion of
the Committee, renders a Participant unable or incompetent to carry out the job responsibilities
which such Participant held or the tasks to which such Participant was assigned at the time the
disability was incurred, and which is expected to be permanent or for an indefinite duration
exceeding one year.

               (h) Exchange Act. The term “Exchange Act” means the Securities Exchange Act of 1934, as
amended, or a successor statute.

               (i) Fair Market Value. The “Fair Market Value” of the Company’s Common Shares shall mean, on
any given date, the last reported sales price of the Common Shares, as reported on the NASDAQ
National Market System or on any securities exchange on which the Company’s Common Shares may be
listed on such date or, if there are no reported sales of Common Shares on such date, then the last
reported sales price on the next preceding day on which such a sale was transacted.

               (j) Incentive Stock Option. “Incentive Stock Option” means any Stock Option granted pursuant
to the provisions of Section 6 of the Plan that is intended to be and is specifically designated as
an “incentive stock option” within the meaning of Section 422 of the Code.

               (k) Non-Qualified Stock Option. A “Non-Qualified Stock Option” means any Stock Option granted
pursuant to the provisions of Section 7 of the Plan that is not an Incentive Stock Option.

-8-

 

               (l) Parent. The term “Parent of the Company” shall have the meaning set forth in 424(e) of
the Code.

               (m) Participant. The term “Participant” shall have the meaning set forth in Section 3 of the
Plan.

               (n) Performance Goals. The term “Performance Goals” shall have the meaning set forth in
Section 9 of the Plan.

               (o) Performance Period. The term “Performance Period” shall have the meaning set forth in
Section 9 of the Plan.

               (p) Performance Share Award. The term “Performance Share Award” shall have the meaning set
forth in Section 9 of the Plan.

               (q) Plan. The “Plan” means the Bob Evans Farms, Inc. Second Amended and Restated 1998 Stock
Option and Incentive Plan, as set forth herein, and as it may be hereafter amended and from time to
time in effect.

               (r) Restricted Stock. The term Restricted Stock shall have the meaning described in Section
10 of this Plan.

               (s) Retirement. The term “Retirement” for all purposes of the Plan shall mean voluntary
separation from employment or termination of service as a director with the Company and each of its
Subsidiaries on or after the date the person both has attained age fifty-five (55) and is credited
with at least ten (10) years of service.

               (t) Stock Appreciation Right. The term Stock Appreciation Right or “SAR” shall mean a right
to receive cash in an amount equal to the excess of the Fair Market Value of a Common Share on the
exercise date of the SAR over the Fair Market Value of a Common Share on the date the SAR is
granted pursuant to the provisions of the Plan.

               (u) Stock Option. The term “Stock Option” means any Incentive Stock Option or Non-Qualified
Stock Option granted under the Plan.

               (v) Stock Option Awards. The term “Stock Option Awards” means any grant of a Stock Option to
a Participant under the Plan.

               (w) Subsidiary. The term “Subsidiary” for all purposes other than the Incentive Stock Option
plan described in Section 6, shall mean any corporation, partnership, joint venture or business
trust, fifty percent (50%) or more of the control of which is owned, directly or indirectly, by the
Company. For purposes of the Incentive Stock Option plan described in Section 6, the term
“Subsidiary” shall be defined as provided in Section 424(f) of the Code.

               (x) Terminated for Cause. The term “Terminated for Cause” for purposes of the Plan shall mean
termination on account of any act of fraud or intentional misrepresentation or embezzlement,
misappropriation or conversion of assets or opportunities of

-9-

 

the Company or a Subsidiary, the
conviction of a felony or intentional and repeated violations of the written policies or procedures
of the Company or any Subsidiary.

          l6. Adjustment Provisions.

               (a) The existence of the Plan and the Awards granted hereunder shall not affect or restrict in
any way the right or power of the Board of Directors or the stockholders of the Company to make or
authorize any adjustment, recapitalization, reorganization or other change in the Company’s capital
structure or its business, any merger or consolidation of the Company, any issue of bonds,
debentures, preferred or prior preference stocks ahead of or affecting the Company’s capital stock
or the rights thereof, the dissolution or liquidation of the Company or any sale or transfer of all
or any part of its assets or business, or any other corporate act or proceeding.

               (b) In the event of any change in capitalization affecting the Common Shares, such as a stock
dividend, stock split, recapitalization, merger, consolidation, split-up, combination or exchange
of shares or other form of reorganization, or any other change affecting the Common Shares, the
Committee shall make proportionate adjustments to reflect such change with respect to the aggregate
number of Common Shares for which Awards in respect thereof may be granted under the Plan, the
maximum number of Common Shares which may be sold or awarded to any Participant, the number of
Common Shares covered by each outstanding Award and the price per share in respect of outstanding
Awards. Notwithstanding the foregoing, an adjustment to a Stock Option pursuant to this
Section 16(b) shall be made only to the extent such adjustment complies, to the extent applicable,
with Section 409A of the Code.

               (c) The Committee also shall make such adjustments in the number of shares covered by, and the
price or other value of, any outstanding Awards in the event of a spin-off or other distribution
(other than normal cash dividends) of assets of the Company to stockholders. Notwithstanding the
foregoing, an adjustment to a Stock Option pursuant to this Section 16(c) shall be made only to the
extent such adjustment complies, to the extent applicable, with Section 409A of the Code.

               (d) Subject to the terms of a Change Agreement (as defined in Section 15(b)), if, within 36
months after a Change in Control, (i) the Plan is terminated and not replaced with a similar
program providing comparable benefits and features or (ii) with respect to a Participant who is a
party to a Change Agreement, an event occurs that generates a change in control payment under that
Participant’s Change Agreement, then (iii) all Stock Options then outstanding under this Plan shall
become fully exercisable as of the date of the Change in Control, whether or not then otherwise
exercisable. In addition, upon Retirement of any Participant, all Stock Options held by such
retiring Participant shall immediately vest and become exercisable.

          17. Amendment and Termination of Plan. The Committee, with the approval of the Board of
Directors of the Company, may amend the Plan from time to time or terminate the Plan at any time
without the approval of the stockholders of the Company except as such stockholder approval may be
required (a) to satisfy the requirements of Rule l6b-3 under the Exchange Act, or any successor
rule or regulation, (b) to satisfy applicable requirements of the

-10-

 

Code or (c) to satisfy applicable
requirements of any securities exchange on which are listed any of the Company’s equity securities
or any requirements applicable to issuers whose securities are traded in the NASDAQ National Market
System. No such action to amend or terminate the Plan shall reduce the then existing amount of any
Participant’s Award or adversely change the terms and conditions thereof without the Participant’s
consent. No amendment of the Plan shall result in any Committee member’s losing his or her status
as a “disinterested person” as defined in Rule l6b-3 under the Exchange Act, or any successor rule
or regulation, with respect to any employee benefit plan of the Company or result in the Plan
losing its status as a plan satisfying the requirements of said Rule l6b-3.

          18. No Right to Employment. Neither the adoption of the Plan nor the granting of any Awards
hereunder shall confer upon any employee or director of the Company or any Subsidiary any right to
continued employment or service with the Company or any Subsidiary, as the case may be, nor shall
it interfere in any way with the right of the Company or
a Subsidiary to terminate the employment or service of any of its employees or directors at any
time, with or without cause.

          19. 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. Any liability
of the Company to any person with respect to any Awards under the Plan shall be based solely upon
any contractual obligations that may be effected pursuant to the Plan. No such obligation of the
Company shall be deemed to be secured by any pledge of, or other encumbrance on, any property of
the Company or any Subsidiary.

          20. Other Company Award and Compensation Plans. Payments and other Awards received by a
Participant under the Plan shall not be deemed a part of a Participant’s regular, recurring
compensation for purposes of any termination indemnity or severance pay law and shall not be
included in, nor have any effect on, the determination of Awards under any other employee benefit
plan or similar arrangement provided by the Company or a Subsidiary unless expressly so provided by
such other plan or arrangement, or except where 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 annual cash
compensation. Awards under the Plan may be made in combination or in tandem with, or as
alternatives to, grants, awards or payments under any other Company or Subsidiary plans. The Plan
notwithstanding, the Company or any Subsidiary may adopt such other compensation programs and
additional compensation arrangements as it deems necessary to attract, retain and reward employees
and directors for their service with the Company and its Subsidiaries.

          21. Securities Law Restrictions. No Common Shares shall be issued under the Plan unless
counsel for the Company shall be satisfied that such issuance will be in compliance with applicable
federal and state securities laws. Certificates for Common Shares delivered under the Plan may be
subject to such stock transfer orders and other restrictions as the Committee may deem advisable
under the rules, regulations and other requirements of the Securities and Exchange Commission, any
stock exchange upon which the Common Shares are then listed or traded, the NASDAQ National Market
System or any applicable federal or state

-11-

 

securities law. The Committee may cause a legend or
legends to be put on any such certificates to make appropriate reference to such restrictions.

          22. Award Agreement. Each Participant receiving an Award under the Plan shall enter into an
agreement with the Company in a form specified by the Committee agreeing to the terms and
conditions of the Award and such related matters as the Committee shall, in its sole discretion,
determine.

          23. Cost of the Plan. The costs and expenses of administering the Plan shall be borne by the
Company.

          24. Governing Law. The Plan and all actions taken thereunder shall be governed by and
construed in accordance with the laws of the State of Delaware.

          25. Stockholder Approval. The Plan was adopted by the Board of Directors of the Company on
May 1, 1998. The Plan and any Award granted thereunder shall be null and void if stockholder
approval is not obtained within twelve (12) months of the adoption of the Plan by the Board of
Directors.

          26. Effective Date. The first amendment and restatement was effective with respect to all
Awards issued on and after May 1, 2002. This second amendment and restatement is effective January
1, 2008.

          27. Compliance with Section 409A of the Code. It is intended that the Plan comply with
Section 409A of the Code and the Treasury Regulations promulgated thereunder (and any subsequent
notices or guidance issued by the Internal Revenue Service), and the Plan shall be interpreted,
administered and operated accordingly. Nothing herein shall be construed as an entitlement to or
guarantee of any particular tax treatment to a Participant.

-12-

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