Document:

EXHIBIT 10.5(b)

 

AMENDMENT

 

TO
THE

 

MAIDENFORM BRANDS,
INC.

 

2004
STOCK OPTION PLAN

 

WHEREAS, Maidenform Brands, Inc. (the “Corporation”) maintains the
Maidenform Brands, Inc. 2004 Stock Option Plan (the “Plan”);

 

WHEREAS, pursuant to Section 10 of the Plan, the Board of Directors of
the Corporation (the “Board”) reserved the right to amend the Plan; and

 

WHEREAS, the Board desires to
amend the Plan.

 

NOW,
THEREFORE, the Plan is amended,
effective upon stockholder approval of the Corporation’s 2005 Stock Incentive
Plan, as follows:

 

1.                                       Section 3 of the Plan is amended by adding the following new
sentence to the end thereof:

 

“Notwithstanding
the foregoing, effective upon stockholder approval of the Corporation’s 2005
Stock Incentive Plan, no shares of Common Stock shall be available for issuance
under this Plan or be subject to Stock Options, provided, however, the Board or
the Committee may, in their sole discretion, modify outstanding Stock Options
in accordance with the terms of the Plan (including, without limitation, to
comply with Section 409A of the Code).”

 

IN WITNESS
WHEREOF, the Corporation has caused
this amendment to be executed this 6th day of July, 2005.

 

 

	
   

  	
  MAIDENFORM BRANDS,
  INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
     /s/ Thomas
  J. Ward

  	
   

  
	
   

  	
   

  	
     Thomas
  J. Ward

  	
   

  
	
   

  	
  Title: Chief
  Executive OfficerEXHIBIT 10.6(b)

 

AMENDMENT

 

TO
THE

 

MAIDENFORM BRANDS,
INC.

 

2004
ROLLOVER STOCK OPTION PLAN

 

WHEREAS, Maidenform Brands, Inc. (the “Corporation”) maintains the
Maidenform Brands, Inc. 2004 Rollover Stock Option Plan (the “Plan”);

 

WHEREAS, pursuant to Section 9 of the Plan, the Board of Directors of
the Corporation (the “Board”) reserved the right to amend the Plan; and

 

WHEREAS, the Board desires to amend the Plan.

 

NOW,
THEREFORE, the Plan is amended,
effective as of the date set forth below, as follows:

 

1.                                       Effective upon stockholder approval of the Corporation’s 2005 Stock
Incentive Plan, Section 3 of the Plan is amended by adding the following
new sentence to the end thereof:

 

“Notwithstanding
the foregoing, effective upon stockholder approval of the Corporation’s 2005
Stock Incentive Plan, no shares of Common Stock shall be available for issuance
under this Plan or be subject to Stock Options.”

 

IN WITNESS
WHEREOF, the Corporation has caused
this amendment to be executed this 6th day of July, 2005.

 

 

	
   

  	
  MAIDENFORM BRANDS,
  INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
     /s/ Thomas
  J. Ward

  	
   

  
	
   

  	
   

  	
     Thomas
  J. Ward

  	
   

  
	
   

  	
  Title: Chief
  Executive OfficerEXHIBIT 10.7(b)

 

AMENDMENT

 

TO THE

 

MAIDENFORM BRANDS, INC.

 

2004 STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS

 

WHEREAS, Maidenform Brands, Inc. (the “Corporation”) maintains the
Maidenform Brands, Inc. 2004 Stock Option Plan for Non-Employee Directors (the
“Plan”);

 

WHEREAS, pursuant to Section 18 of the Plan, the Board of Directors of
the Corporation (the “Board”) reserved the right to amend the Plan; and

 

WHEREAS, the Board desires to
amend the Plan.

 

NOW,
THEREFORE, the Plan is amended,
effective as of the dates set forth below, as follows:

 

1.                                       Effective upon stockholder approval of the Corporation’s 2005 Stock
Incentive Plan, Section 2 of the Plan is amended by adding the following
new sentence to the end thereof:

 

“Notwithstanding
the foregoing, effective upon stockholder approval of the Corporation’s 2005
Stock Incentive Plan, no shares of Common Stock shall be available for issuance
under this Plan or be subject to Options, provided, however, the Board may, in
its sole discretion, modify outstanding Options in accordance with the terms of
the Plan (including, without limitation, to comply with Section 409A of
the Code).”

 

2.                                       Effective as of June 1, 2005, subject to stockholder approval, Section 4
of the Plan is amended by adding the following new sentence to the end thereof:

 

“The Board
may, in its sole discretion, modify the exercise price under any Option,
provided, however, no action taken by the Board shall adversely

 

 

affect in any respect the rights granted to any Participant under any
outstanding Option without the Participant’s written consent.”

 

IN WITNESS
WHEREOF, the Corporation has caused
this amendment to be executed this 6th day of July, 2005.

 

	
   

  	
  MAIDENFORM BRANDS,
  INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
     /s/ Thomas
  J. Ward

  	
   

  
	
   

  	
   

  	
     Thomas
  J. Ward

  	
   

  
	
   

  	
  Title: Chief
  Executive Officer

  

 

2EXHIBIT 10.9

 

MAIDENFORM BRANDS, INC.

 

 

2005 STOCK INCENTIVE PLAN

 

 

ARTICLE I

PURPOSE

 

The purpose of this Plan is to enhance the profitability and value of
the Company for the benefit of its stockholders by enabling the Company to
offer Eligible Employees, Consultants and Non-Employee Directors stock-based
incentives in the Company to attract, retain and reward such individuals and
strengthen the mutuality of interests between such individuals and the Company’s
stockholders.

 

ARTICLE II

DEFINITIONS

 

For purposes of this Plan, the following terms shall have the following
meanings:

 

2.1                               “Acquisition
Event” means a merger or consolidation in which the Company is not the
surviving entity, any transaction that results in the acquisition of
substantially all of the Company’s outstanding Common Stock by a single person
or entity or by a group of persons and/or entities acting in concert, or the
sale or transfer of all or substantially all of the Company’s assets.

 

2.2                               “Affiliate”
means each of the following: (a) any Subsidiary; (b) any Parent; (c) any
corporation, trade or business (including, without limitation, a partnership or
limited liability company) which is directly or indirectly controlled 50% or
more (whether by ownership of stock, assets or an equivalent ownership interest
or voting interest) by the Company or one of its Affiliates; (c) any
corporation, trade or business (including, without limitation, a partnership or
limited liability company) which directly or indirectly controls 50% or more
(whether by ownership of stock, assets or an equivalent ownership interest or
voting interest) of the Company; and (e) any other entity in which the
Company or any of its Affiliates has a material equity interest and which is
designated as an “Affiliate” by resolution of the Committee.

 

2.3                               “Ares
Person” means (i) Ares Corporate Opportunities Fund, L.P., a
limited partnership organized under the laws of Delaware; (ii) any
investment fund, investment account or investment partnership whose investment
manager, investment advisor or general partner, is an Ares Person or the
investment manager, investment advisor or general partner of an Ares Person; (iii) any
Affiliate of any Person specified in clause (i) or (ii) above; (iv) any
member or

 

 

partner of any Person specified
in clause (i), (ii) or (iii) above; or (v) any officer or
employee of any Person specified in clause (i)-(iv) above.

 

2.4                               “Award”
means any award under this Plan of any Stock Option, Stock Appreciation Right,
Restricted Stock, Performance Share or Other Stock-Based Award.  All Awards shall be granted by, confirmed by,
and subject to the terms of, a written agreement executed by the Company and
the Participant.

 

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

 

2.6                               “Cause”
means with respect to a Participant’s Termination of Employment or Termination
of Consultancy, the following: (a) in the case where there is no
employment agreement, consulting agreement, change in control agreement or
similar agreement in effect between the Company or an Affiliate and the
Participant at the time of the grant of the Award (or where there is such an
agreement but it does not define “cause” (or words of like import)), termination
due to: (i) a Participant’s conviction of, or plea of guilty or nolo
contendere to, a felony; (ii) perpetration by a Participant of an illegal
act, dishonesty, or fraud which could cause significant economic injury to the
Company; (iii) a Participant’s insubordination, refusal to perform his or
her duties or responsibilities for any reason other than illness or incapacity
or materially unsatisfactory performance of his or her duties for the Company; (iv) continuing
willful and deliberate failure by the Participant to perform the Participant’s
duties in any material respect, provided that the Participant is given notice
and an opportunity to effectuate a cure as determined by the Committee; or (v) a
Participant’s willful misconduct with regard to the Company that could have a
material adverse effect on the Company; or (b) in the case where there is
an employment agreement, consulting agreement, change in control agreement or
similar agreement in effect between the Company or an Affiliate and the
Participant at the time of the grant of the Award that defines “cause” (or
words of like import), “cause” as defined under such agreement; provided,
however, that with regard to any agreement under which the definition of “cause”
only applies on occurrence of a change in control, such definition of “cause”
shall not apply until a change in control actually takes place and then only
with regard to a termination thereafter. 
With respect to a Participant’s Termination of Directorship, “cause”
means an act or failure to act that constitutes cause for removal of a director
under applicable Delaware law.

 

2.7                               “Change
in Control” has the meaning set forth in Section 11.2.

 

2.8                               “Change
in Control Price” has the meaning set forth in Section 11.1.

 

2.9                               “Code”
means the Internal Revenue Code of 1986, as amended.  Any reference to any section of the Code
shall also be a reference to any successor provision and any Treasury
Regulation promulgated thereunder.

 

2.10                        “Committee”
means:  (a) with respect to the
application of this Plan to Eligible Employees and Consultants, a committee or
subcommittee of the Board appointed from time to time by the Board, which
committee or subcommittee shall consist of two or more non-employee directors,
each of whom is intended to be, to the extent required by Rule 16b-3
promulgated under Section 16(b) of the Exchange Act, a “non-employee
director” as defined in Rule 16b-3; and to the extent required by
applicable stock exchange rules, “independent” as defined under

 

2

 

applicable stock exchange
rules; and (b) with respect to the application of this Plan to
Non-Employee Directors, the Board.  To
the extent that no Committee exists that has the authority to administer this
Plan, the functions of the Committee shall be exercised by the Board.  If for any reason the appointed Committee does
not meet the requirements of Rule 16b-3, such noncompliance with the
requirements of Rule 16b-3 shall not affect the validity of Awards,
grants, interpretations or other actions of the Committee.

 

2.11                        “Common
Stock” means the Common Stock, $0.01 par value per share, of the
Company.

 

2.12                        “Company”
means Maidenform Brands Inc., a Delaware corporation, and its successors by
operation of law.

 

2.13                        “Consultant”
means any natural person who provides bona fide consulting or advisory services
to the Company or its Affiliates, which are not in connection with the offer
and sale of securities in a capital raising transaction.

 

2.14                        “Detrimental
Activity” means: (a) the disclosure to anyone outside the Company
or its Affiliates, or the use in any manner other than in the furtherance of
the Company’s or its Affiliate’s business, without written authorization from
the General Counsel or the Chief Executive Officer of the Company, of any
confidential information or proprietary information, relating to the business of
the Company or its Affiliates that is acquired by a Participant prior to the
Participant’s Termination; (b) activity while employed or performing
services that results, or if known could result, in the Participant’s
Termination that is classified by the Company as a termination for Cause; (c) the
Participant’s Disparagement, or inducement of others to do so, of the Company
or its Affiliates or their past and present officers, directors, employees or
products; or (d) breach of any agreement between the Participant and the
Company or an Affiliate (including, without limitation, any employment agreement
or noncompetition or nonsolicitation agreement).

 

2.15                        “Disability”
means with respect to a Participant’s Termination, a permanent and total
disability as defined in Section 22(e)(3) of the Code.  A Disability shall only be deemed to occur at
the time of the determination by the Committee of the Disability.  Notwithstanding the foregoing, for Awards
that are subject to Section 409A of the Code, Disability shall mean that a
Participant is disabled under Section 409A(a)(2)(C)(i) of the Code.

 

2.16                        “Disparagement”
means making comments or statements to the press, the Company’s or its
Affiliates’ employees, consultants or any individual or entity with whom the
Company or its Affiliates has a business relationship which could reasonably be
expected to adversely affect in any manner: (a) the conduct of the
business of the Company or its Affiliates (including, without limitation, any
products or business plans or prospects); or (b) the business reputation
of the Company or its Affiliates, or any of their products, or their past or
present officers, directors or employees.

 

2.17                        “Effective
Date” means the effective date of this Plan as defined in Article XV.

 

2.18                        “Eligible
Employees” means each employee of the Company or an Affiliate.

 

3

 

2.19                        “Exchange
Act” means the Securities Exchange Act of 1934, as amended.  Any references to any section of the
Exchange Act shall also be a reference to any successor provision.

 

2.20                        “Fair
Market Value” means, unless otherwise required by any applicable
provision of the Code or any regulations issued thereunder, as of any date and
except as provided below, the last sales price reported for the Common Stock on
the applicable date: (a) as reported on the principal national securities
exchange in the United States on which it is then traded or The Nasdaq Stock
Market; or (b) if not traded on any such national securities exchange or
The Nasdaq Stock Market, as quoted on an automated quotation system sponsored
by the National Association of Securities Dealers, Inc. or if the Common
Stock shall not have been reported or quoted on such date, on the first day
prior thereto on which the Common Stock was reported or quoted.  For purposes of the grant of any Award, the
applicable date shall be the trading day immediately prior to the date on which
the Award is granted.  For purposes of
the exercise of any Award, the applicable date shall be the date a notice of
exercise is received by the Committee or, if not a day on which the applicable
market is open, the next day that it is open. 
Notwithstanding anything herein to the contrary, for purposes of Stock
Options that are granted effective on the initial Registration Date, the Fair
Market Value shall equal the initial public offering price of the Common Stock.

 

2.21                        “Family
Member” means “family member” as defined in Section A.1.(5) of
the general instructions of Form S-8.

 

2.22                        “Incentive
Stock Option” means any Stock Option awarded to an Eligible Employee of
the Company, its Subsidiaries and its Parent (if any) under this Plan intended
to be and designated as an “Incentive Stock Option” within the meaning of Section 422
of the Code.

 

2.23                        “Non-Employee
Director” means a director of the Company who is not an active employee
of the Company or an Affiliate.

 

2.24                        “Non-Qualified
Stock Option” means any Stock Option awarded under this Plan that is
not an Incentive Stock Option.

 

2.25                        “Other
Stock-Based Award” means an Award under Article X of this Plan
that is valued in whole or in part by reference to, or is payable in or
otherwise based on, Common Stock, including, without limitation, an Award
valued by reference to an Affiliate.

 

2.26                        “Parent”
means any parent corporation of the Company within the meaning of Section 424(e) of
the Code.

 

2.27                        “Participant”
means an Eligible Employee, Non-Employee Director or Consultant to whom an
Award has been granted pursuant to this Plan.

 

2.28                        “Performance
Period” has the meaning set forth in Section 9.1.

 

2.29                        “Performance
Share” means an Award made pursuant to Article IX of this Plan of
the right to receive Common Stock or cash of an equivalent value at the end of
a specified Performance Period.

 

4

 

2.30                        “Person”
means any individual, corporation, partnership, limited liability company,
firm, joint venture, association, joint-stock company, trust, incorporated
organization, governmental or regulatory or other entity.

 

2.31                        “Plan”
means this Maidenform Brands, Inc. 2005 Stock Incentive Plan, as amended
from time to time.

 

2.32                        “Reference
Stock Option” has the meaning set forth in Section 7.1.

 

2.33                        “Registration
Date” means the first date (a) on which the Company sells its Common
Stock in a bona fide, firm commitment underwriting pursuant to a registration
statement under the Securities Act or (b) any class of common equity
securities of the Company is required to be registered under Section 12 of
the Exchange Act.

 

2.34                        “Restricted
Stock” means an Award of shares of Common Stock under this Plan that is
subject to restrictions under Article VIII.

 

2.35                        “Restriction
Period” has the meaning set forth in Subsection 8.3(a).

 

2.36                        “Retirement”
means a Termination of Employment or Termination of Consultancy at or after age
65 or such earlier date after age 50 as may be approved by the Committee, in
its sole discretion, with regard to such Participant, except that Retirement
shall not include any Termination for Cause. 
With respect to a Participant’s Termination of Directorship, Retirement
means the failure to stand for reelection or the failure to be reelected on or
after a Participant has attained age 65 or, with the consent of the Board,
before age 65 but after age 50.

 

2.37                        “Rule 16b-3”
means Rule 16b-3 under Section 16(b) of the Exchange Act as then
in effect or any successor provision.

 

2.38                        “Securities
Act” means the Securities Act of 1933, as amended and all rules and
regulations promulgated thereunder.  Any
reference to any section of the Securities Act shall also be a reference
to any successor provision.

 

2.39                        “Stock
Appreciation Right” shall mean the right pursuant to an Award granted
under Article VII.  A Tandem Stock
Appreciation Right shall mean the right to surrender to the Company all (or a
portion) of a Stock Option in exchange for a number of shares of Common Stock equal
to the difference between (i) the Fair Market Value on the date such Stock
Option (or such portion thereof) is surrendered, of the Common Stock covered by
such Stock Option (or such portion thereof), and (ii) the aggregate
exercise price of such Stock Option (or such portion thereof).  A Non-Tandem Stock Appreciation Right shall
mean the right to receive a number of shares of Common Stock equal to the difference
between (x) the Fair Market Value of a share of Common Stock on the date
such right is exercised, and (y) the aggregate exercise price of such right,
otherwise than on surrender of a Stock Option.

 

2.40                        “Stock
Option” or “Option”
means any option to purchase shares of Common Stock granted to Eligible
Employees, Non-Employee Directors or Consultants granted pursuant to Article VI.

 

5

 

2.41                        “Subsidiary”
means any subsidiary corporation of the Company within the meaning of Section 424(f) of
the Code.

 

2.42                        “Ten
Percent Stockholder” means a person owning stock possessing more than
10% of the total combined voting power of all classes of stock of the Company,
its Subsidiaries or its Parent.

 

2.43                        “Termination”
means a Termination of Consultancy, Termination of Directorship or Termination
of Employment, as applicable.

 

2.44                        “Termination
of Consultancy” means: (a) that the Consultant is no longer acting
as a consultant to the Company or an Affiliate; or (b) when an entity
which is retaining a Participant as a Consultant ceases to be an Affiliate
unless the Participant otherwise is, or thereupon becomes, a Consultant to the
Company or another Affiliate at the time the entity ceases to be an Affiliate.  In the event that a Consultant becomes an
Eligible Employee or a Non-Employee Director upon the termination of his or her
consultancy, unless otherwise determined by the Committee, in its sole
discretion, no Termination of Consultancy shall be deemed to occur until such
time as such Consultant is no longer a Consultant, an Eligible Employee or a
Non-Employee Director.  Notwithstanding
the foregoing, the Committee may, in its sole discretion, otherwise define
Termination of Consultancy in the Award agreement or, if no rights of a
Participant are reduced, may otherwise define Termination of Consultancy
thereafter.

 

2.45                        “Termination
of Directorship” means that the Non-Employee Director has ceased to be
a director of the Company; except that if a Non-Employee Director becomes an
Eligible Employee or a Consultant upon the termination of his or her
directorship, his or her ceasing to be a director of the Company shall not be
treated as a Termination of Directorship unless and until the Participant has a
Termination of Employment or Termination of Consultancy, as the case may be.

 

2.46                        “Termination
of Employment” means: (a) a termination of employment (for reasons
other than a military or personal leave of absence granted by the Company) of a
Participant from the Company and its Affiliates; or (b) when an entity
which is employing a Participant ceases to be an Affiliate, unless the
Participant otherwise is, or thereupon becomes, employed by the Company or
another Affiliate at the time the entity ceases to be an Affiliate.  In the event that an Eligible Employee
becomes a Consultant or a Non-Employee Director upon the termination of his or
her employment, unless otherwise determined by the Committee, in its sole
discretion, no Termination of Employment shall be deemed to occur until such
time as such Eligible Employee is no longer an Eligible Employee, a Consultant
or a Non-Employee Director. 
Notwithstanding the foregoing, the Committee may, in its sole
discretion, otherwise define Termination of Employment in the Award agreement
or, if no rights of a Participant are reduced, may otherwise define Termination
of Employment thereafter.

 

2.47                        “Transfer”
means: (a) when used as a noun, any direct or indirect transfer, sale,
assignment, pledge, hypothecation, encumbrance or other disposition (including
the issuance of equity in a Person), whether for value or no value and whether
voluntary or involuntary (including by operation of law), and (b) when
used as a verb, to directly or indirectly transfer, sell, assign, pledge,
encumber, charge, hypothecate or otherwise dispose of (including the

 

6

 

issuance of equity in a Person)
whether for value or for no value and whether voluntarily or involuntarily
(including by operation of law).  “Transferred”
and “Transferrable” shall have a correlative meaning.

 

2.48                        “Transition
Period” means the “reliance period” under Treasury Regulation Section 1.162-27(f)(2),
which ends on the earliest to occur of the following: (i) the date of the
first annual meeting of stockholders of the Company at which directors are to
be elected that occurs after December 31, 2008, provided, however, if the
Registration Date does not occur in 2005, the date of the first annual meeting
of stockholders at which directors are to be elected that occurs after the
close of the third calendar year following the calendar year in which the
Registration Date occurs; (ii) the date the Plan is materially amended for
purposes of Treasury Regulation Section 1.162-27(h)(1)(iii); or (iii) the
date all shares of Common Stock available for issuance under this Plan have
been allocated.

 

ARTICLE III

ADMINISTRATION

 

3.1                               The
Committee.  The Plan shall be
administered and interpreted by the Committee.

 

3.2                               Grants
of Awards.  The Committee shall
have full authority to grant, pursuant to the terms of this Plan, to Eligible
Employees, Consultants and Non-Employee Directors: (i) Stock Options, (ii) Stock
Appreciation Rights, (iii) Restricted Stock, (iv) Performance Shares;
and (v) Other Stock-Based Awards. 
In particular, the Committee shall have the authority:

 

(a)                                  to
select the Eligible Employees, Consultants and Non-Employee Directors to whom
Awards may from time to time be granted hereunder;

 

(b)                                 to
determine whether and to what extent Awards, or any combination thereof, are to
be granted hereunder to one or more Eligible Employees, Consultants or
Non-Employee Directors;

 

(c)                                  to
determine the number of shares of Common Stock to be covered by each Award
granted hereunder;

 

(d)                                 to
determine the terms and conditions, not inconsistent with the terms of this
Plan, of any Award granted hereunder (including, but not limited to, the
exercise or purchase price (if any), any restriction or limitation, any vesting
schedule or acceleration thereof, or any forfeiture restrictions or waiver
thereof, regarding any Award and the shares of Common Stock relating thereto,
based on such factors, if any, as the Committee shall determine, in its sole
discretion);

 

(e)                                  to
determine whether, to what extent and under what circumstances grants of
Options and other Awards under this Plan are to operate on a tandem basis
and/or in conjunction with or apart from other awards made by the Company
outside of this Plan;

 

7

 

(f)                                    to
determine whether and under what circumstances a Stock Option may be settled in
cash, Common Stock and/or Restricted Stock under Section 6.4(d);

 

(g)                                 to
determine whether, to what extent and under what circumstances Common Stock and
other amounts payable with respect to an Award under this Plan shall be
deferred either automatically or at the election of the Participant in any
case, subject to, and in accordance with, Section 409A of the Code;

 

(h)                                 to
determine whether a Stock Option is an Incentive Stock Option or Non-Qualified
Stock Option;

 

(i)                                     to
determine whether to require a Participant, as a condition of the granting of
any Award, to not sell or otherwise dispose of shares acquired pursuant to the
exercise of an Award for a period of time as determined by the Committee, in
its sole discretion, following the date of the acquisition of such Award; and

 

(j)                                     to
offer to buy out an Award previously granted, based on such terms and
conditions as the Committee shall establish and communicate to the Participant
at the time such offer is made.

 

3.3                               Guidelines.  Subject to Article XII hereof, the
Committee shall, in its sole discretion, have the authority to adopt, alter and
repeal such administrative rules, guidelines and practices governing this Plan
and perform all acts, including the delegation of its responsibilities (to the
extent permitted by applicable law and applicable stock exchange rules), as it
shall, from time to time, deem advisable; to construe and interpret the terms
and provisions of this Plan and any Award issued under this Plan (and any
agreements relating thereto); and to otherwise supervise the administration of
this Plan.  The Committee may, in its
sole discretion, correct any defect, supply any omission or reconcile any
inconsistency in this Plan or in any agreement relating thereto in the manner
and to the extent it shall deem necessary to effectuate the purpose and intent
of this Plan.  The Committee may, in its
sole discretion, adopt special guidelines and provisions for persons who are
residing in or employed in, or subject to, the taxes of, any domestic or
foreign jurisdictions to comply with applicable tax and securities laws of such
domestic or foreign jurisdictions.  To
the extent applicable, this Plan is intended to comply with the applicable requirements
of Rule 16b-3, and this Plan shall be limited, construed and interpreted
in a manner so as to comply therewith.

 

3.4                               Decisions
Final.  Any decision,
interpretation or other action made or taken in good faith by or at the
direction of the Company, the Board or the Committee (or any of its members)
arising out of or in connection with this Plan shall be within the absolute
discretion of all and each of them, as the case may be, and shall be final,
binding and conclusive on the Company and all employees and Participants and
their respective heirs, executors, administrators, successors and assigns.

 

8

 

3.5                               Procedures.  If the Committee is appointed, the Board
shall designate one of the members of the Committee as chairman and the
Committee shall hold meetings, subject to the By-Laws of the Company, at such
times and places as it shall deem advisable, including, without limitation, by
telephone conference or by written consent to the extent permitted by applicable
law.  A majority of the Committee members
shall constitute a quorum.  All
determinations of the Committee shall be made by a majority of its members.  Any decision or determination reduced to
writing and signed by all the Committee members in accordance with the By-Laws
of the Company, shall be fully effective as if it had been made by a vote at a
meeting duly called and held.  The
Committee shall keep minutes of its meetings and shall make such rules and
regulations for the conduct of its business as it shall deem advisable.

 

3.6                               Designation
of Consultants/Liability.

 

(a)                                  The
Committee may, in its sole discretion, designate employees of the Company and
professional advisors to assist the Committee in the administration of this
Plan and (to the extent permitted by applicable law and applicable exchange
rules) may grant authority to officers to grant Awards and/or execute
agreements or other documents on behalf of the Committee.

 

(b)                                 The
Committee may, in its sole discretion, employ such legal counsel, consultants
and agents as it may deem desirable for the administration of this Plan and may
rely upon any opinion received from any such counsel or consultant and any
computation received from any such consultant or agent.  Expenses incurred by the Committee or the
Board in the engagement of any such counsel, consultant or agent shall be paid
by the Company.  The Committee, its
members and any person designated pursuant to sub-section (a) above
shall not be liable for any action or determination made in good faith with
respect to this Plan.  To the maximum
extent permitted by applicable law, no officer of the Company or member or
former member of the Committee or of the Board shall be liable for any action
or determination made in good faith with respect to this Plan or any Award
granted under it.

 

3.7                               Indemnification.  To the maximum extent permitted by applicable
law and the Certificate of Incorporation and By-Laws of the Company and to the
extent not covered by insurance directly insuring such person, each officer and
member or former member of the Committee or the Board shall be indemnified and
held harmless by the Company against any cost or expense (including reasonable
fees of counsel reasonably acceptable to the Committee) or liability (including
any sum paid in settlement of a claim with the approval of the Committee), and
advanced amounts necessary to pay the foregoing at the earliest time and to the
fullest extent permitted, arising out of any act or omission to act in
connection with the administration of this Plan, except to the extent arising
out of such officer’s, member’s or former member’s fraud.  Such indemnification shall be in addition to
any rights of indemnification the employees, officers, directors or members or
former officers, directors or members may have under applicable law or under
the Certificate of Incorporation or By-Laws of the Company or any
Affiliate.  Notwithstanding anything else
herein, this indemnification will not apply to the

 

9

 

actions or determinations made
by an individual with regard to Awards granted to him or her under this Plan.

 

ARTICLE IV

SHARE LIMITATION

 

4.1                               Shares.  The aggregate number of shares of Common
Stock that may be issued or used for reference purposes or with respect to
which Awards may be granted under this Plan shall not exceed 1,750,000 shares
(subject to any increase or decrease pursuant to Section 4.2), which may
be either authorized and unissued Common Stock or Common Stock held in or
acquired for the treasury of the Company or both.  If any Option, Stock Appreciation Right or
Other Stock-Based Awards granted under this Plan expires, terminates or is
canceled for any reason without having been exercised in full, the number of
shares of Common Stock underlying any unexercised Award shall again be
available for the purpose of Awards under the Plan.  If any shares of Restricted Stock, Performance
Shares or Other Stock-Based Awards denominated in shares of Common Stock
awarded under this Plan to a Participant are forfeited for any reason, the
number of forfeited shares of Restricted Stock, Performance Shares or Other
Stock-Based Awards denominated in shares of Common Stock shall again be
available for the purposes of Awards under the Plan.  If a Tandem Stock Appreciation Right or a
Limited Stock Appreciation Right is granted in tandem with an Option, such
grant shall only apply once against the maximum number of shares of Common
Stock which may be issued under this Plan. 
In addition, in determining the number of shares of Common Stock
available for Awards, if Common Stock has been delivered or exchanged by a
Participant as full or partial payment to the Company for payment of the
exercise price, or for payment of withholding taxes, or if the number shares of
Common Stock otherwise deliverable has been reduced for payment of the exercise
price or for payment of withholding taxes, the number of shares of Common Stock
exchanged as payment in connection with the exercise or for withholding or
reduced shall again be available for purpose of Awards under this Plan.

 

4.2                               Changes.  

 

(a)                                  The
existence of this Plan and the Awards granted hereunder shall not affect in any
way the right or power of the Board or the stockholders of the Company to make
or authorize (i) any adjustment, recapitalization, reorganization or other
change in the Company’s capital structure or its business, (ii) any merger
or consolidation of the Company or any Affiliate, (iii) any issuance of
bonds, debentures, preferred or prior preference stock ahead of or affecting
the Common Stock, (iv) the dissolution or liquidation of the Company or
any Affiliate, (v) any sale or transfer of all or part of the assets or
business of the Company or any Affiliate or (vi) any other corporate act
or proceeding.

 

(b)                                 Subject
to the provisions of Section 4.2(d), in the event of any such change in
the capital structure or business of the Company by reason of any stock split,
reverse stock split, stock dividend, combination or reclassification of shares,
recapitalization, merger, consolidation, spin-off,

 

10

 

reorganization, partial or
complete liquidation, issuance of rights or warrants to purchase any Common
Stock or securities convertible into Common Stock, any sale or transfer of all
or part of the Company’s assets or business, or any other corporate transaction
or event having an effect similar to any of the foregoing and effected without
receipt of consideration by the Company and the Committee determines in its
sole discretion that an adjustment is necessary or appropriate under the Plan
to prevent substantial dilution or enlargement of the rights granted to, or
available for, Participants under the Plan, then the aggregate number and kind
of shares that thereafter may be issued under this Plan, the number and kind of
shares or other property (including cash) to be issued upon exercise of an
outstanding Award or under other Awards granted under this Plan and the
purchase price thereof shall be appropriately adjusted consistent with such
change in such manner as the Committee may, in its sole discretion, deem
equitable to prevent substantial dilution or enlargement of the rights granted
to, or available for, Participants under this Plan, and any such adjustment determined
by the Committee shall be final, binding and conclusive on the Company and all
Participants and employees and their respective heirs, executors,
administrators, successors and assigns. 
In connection with any event described in this paragraph, the Committee
may provide, in its sole discretion, for the cancellation of any outstanding
Awards and payment in cash or other property in exchange therefor.  Except as provided in this Section 4.2
or in the applicable Award agreement, a Participant shall have no rights by
reason of any issuance by the Company of any class or securities convertible
into stock of any class, any subdivision or consolidation of shares of stock of
any class, the payment of any stock dividend, any other increase or decrease in
the number of shares of stock of any class, any sale or transfer of all or part
of the Company’s assets or business or any other change affecting the Company’s
capital structure or business.

 

(c)                                  Fractional
shares of Common Stock resulting from any adjustment in Awards pursuant to Section 4.2(a) or
(b) shall be aggregated until, and eliminated at, the time of exercise by
rounding-down for fractions less than one-half and rounding-up for fractions
equal to or greater than one-half.  No
cash settlements shall be made with respect to fractional shares eliminated by
rounding.  Notice of any adjustment shall
be given by the Committee to each Participant whose Award has been adjusted and
such adjustment (whether or not such notice is given) shall be effective and
binding for all purposes of this Plan.

 

(d)                                 In
the event of an Acquisition Event, the Committee may, in its sole discretion,
terminate all outstanding and unexercised Stock Options or Stock Appreciation
Rights effective as of the date of the Acquisition Event, by delivering notice
of termination to each Participant at least 20 days prior to the date of
consummation of the Acquisition Event, in which case during the period from the
date on which such notice of termination

 

11

 

is delivered to the
consummation of the Acquisition Event, each such Participant shall have the
right to exercise in full all of his or her Stock Options or Stock Appreciation
Rights that are then outstanding (without regard to any limitations on
exercisability otherwise contained in the Award agreements), but any such
exercise shall be contingent on the occurrence of the Acquisition Event, and,
provided that, if the Acquisition Event does not take place within a specified
period after giving such notice for any reason whatsoever, the notice and
exercise pursuant thereto shall be null and void.

 

If an Acquisition Event occurs but the Committee does not terminate the
outstanding Awards pursuant to this Section 4.2(d), then the provisions of
Section 4.2(b) and Article XI shall apply.

 

4.3                               Minimum
Purchase Price.  Notwithstanding
any provision of this Plan to the contrary, if authorized but previously
unissued shares of Common Stock are issued under this Plan, such shares shall not
be issued for a consideration that is less than as permitted under applicable
law.

 

ARTICLE V

ELIGIBILITY

 

5.1                               General
Eligibility.  All Eligible Employees,
prospective employees and Consultants of the Company and its Affiliates, and
Non-Employee Directors of the Company, are eligible to be granted Awards.  Eligibility for the grant of Awards and
actual participation in this Plan shall be determined by the Committee in its
sole discretion.

 

5.2                               Incentive
Stock Options.  Notwithstanding anything
herein to the contrary, only Eligible Employees of the Company, its
Subsidiaries and its Parent (if any) are eligible to be granted Incentive Stock
Options under this Plan.  Eligibility for
the grant of an Incentive Stock Option and actual participation in this Plan
shall be determined by the Committee in its sole discretion.

 

5.3                               General
Requirement.  The vesting and
exercise of Awards granted to a prospective employee or consultant are
conditioned upon such individual actually becoming an Eligible Employee or
Consultant.

 

ARTICLE VI

STOCK OPTIONS

 

6.1                               Options.  Stock Options may be granted alone or in
addition to other Awards granted under this Plan.  Each Stock Option granted under this Plan
shall be of one of two types: (a) an Incentive Stock Option or (b) a
Non-Qualified Stock Option.

 

6.2                               Grants.  The Committee shall, in its sole discretion,
have the authority to grant to any Eligible Employee Incentive Stock Options,
Non-Qualified Stock Options, or both types of

 

12

 

Stock Options.  The Committee shall, in its sole discretion,
have the authority to grant any Consultant or Non-Employee Director Non-Qualified
Stock Options.  To the extent that any
Stock Option does not qualify as an Incentive Stock Option (whether because of
its provisions or the time or manner of its exercise or otherwise), such Stock
Option or the portion thereof which does not qualify shall constitute a
separate Non-Qualified Stock Option.

 

6.3                               Terms
of Options.  Options granted
under this Plan shall be subject to the following terms and conditions and
shall be in such form and contain such additional terms and conditions, not
inconsistent with the terms of this Plan, as the Committee, in its sole
discretion, shall deem desirable:

 

(a)                                  Exercise
Price.  The exercise price per share
of Common Stock subject to a Stock Option shall be determined by the Committee
at the time of grant, provided that the per share exercise price of a Stock
Option shall not be less than 100% (or, in the case of an Incentive Stock
Option granted to a Ten Percent Stockholder, 110%) of the Fair Market Value of
the Common Stock at the time of grant.

 

(b)                                 Stock
Option Term.  The term of each Stock
Option shall be fixed by the Committee, provided that no Stock Option shall be
exercisable more than 10 years after the date the Option is granted; and
provided further that the term of an Incentive Stock Option granted to a Ten
Percent Stockholder shall not exceed five years.

 

(c)                                  Exercisability.  Stock Options shall be exercisable at such
time or times and subject to such terms and conditions as shall be determined
by the Committee at grant.  If the
Committee provides, in its discretion, that any Stock Option is exercisable subject
to certain limitations (including, without limitation, that such Stock Option
is exercisable only in installments or within certain time periods), the
Committee may waive such limitations on the exercisability at any time at or
after grant in whole or in part (including, without limitation, waiver of the
installment exercise provisions or acceleration of the time at which such Stock
Option may be exercised), based on such factors, if any, as the Committee shall
determine, in its sole discretion. 
Unless otherwise determined by the Committee at grant, the Option
agreement shall provide that (i) in the event the Participant engages in
Detrimental Activity prior to any exercise of the Stock Option, all Stock
Options held by the Participant shall thereupon terminate and expire, (ii) as
a condition of the exercise of a Stock Option, the Participant shall be
required to certify (or shall be deemed to have certified) at the time of
exercise in a manner acceptable to the Company that the Participant is in
compliance with the terms and conditions of the Plan and that the Participant
has not engaged in, and does not intend to engage in, any Detrimental Activity,
and (iii) in the event the Participant engages in Detrimental Activity
during the one year period commencing on the later of the date the Stock Option
is exercised or becomes vested, the Company shall be entitled to recover from
the

 

13

 

Participant at any time within
one year after such exercise or vesting, and the Participant shall pay over to
the Company, an amount equal to any gain realized as a result of the exercise
(whether at the time of exercise or thereafter).

 

(d)                                 Method
of Exercise.  Subject to whatever
installment exercise and waiting period provisions apply under subsection (c) above,
to the extent vested, Stock Options may be exercised in whole or in part at any
time during the Option term, by giving written notice of exercise to the
Company specifying the number of shares of Common Stock to be purchased.  Such notice shall be accompanied by payment
in full of the purchase price as follows: (i) in cash or by check, bank
draft or money order payable to the order of the Company; (ii) solely to
the extent permitted by applicable law, if the Common Stock is traded on a
national securities exchange, The Nasdaq Stock Market or quoted on a national
quotation system sponsored by the National Association of Securities Dealers,
and the Committee authorizes, through a procedure whereby the Participant
delivers irrevocable instructions to a broker reasonably acceptable to the
Committee to deliver promptly to the Company an amount equal to the purchase
price; or (iii) on such other terms and conditions as may be acceptable to
the Committee (including, without limitation, the relinquishment of Stock
Options or by payment in full or in part in the form of Common Stock owned by
the Participant for a period of at least six months or such other period
necessary to avoid a charge, for accounting purposes, against the Company’s
earnings as reported in the Company’s financial statements (and for which the
Participant has good title free and clear of any liens and encumbrances) based
on the Fair Market Value of the Common Stock on the payment date as determined
by the Committee, in its sole discretion). 
No shares of Common Stock shall be issued until payment therefor, as
provided herein, has been made or provided for.

 

(e)                                  Non-Transferability
of Options.  No Stock Option shall be
Transferable by the Participant otherwise than by will or by the laws of
descent and distribution, and all Stock Options shall be exercisable, during
the Participant’s lifetime, only by the Participant.  Notwithstanding the foregoing, the Committee
may determine, in its sole discretion, at the time of grant or thereafter that
a Non-Qualified Stock Option that is otherwise not Transferable pursuant to
this Section is Transferable to a Family Member in whole or in part and in
such circumstances, and under such conditions, as determined by the Committee,
in its sole discretion.  A Non-Qualified
Stock Option that is Transferred to a Family Member pursuant to the preceding
sentence (i) may not be subsequently Transferred otherwise than by will or
by the laws of descent and distribution and (ii) remains subject to the
terms of this Plan and the applicable Award agreement.  Any shares of Common Stock acquired upon the
exercise of a Non-Qualified Stock Option by a permissible transferee of a Non-

 

14

 

Qualified Stock Option or a
permissible transferee pursuant to a Transfer after the exercise of the
Non-Qualified Stock Option shall be subject to the terms of this Plan and the
applicable Award agreement.

 

(f)                                    Termination
by Death, Disability or Retirement.  Unless
otherwise determined by the Committee at grant, or if no rights of the
Participant are reduced, thereafter, if Participant’s Termination is by reason
of death, Disability or Retirement, all Stock Options that are held by such
Participant that are vested and exercisable at the time of the Participant’s
Termination may be exercised by the Participant (or, in the case of death, by
the legal representative of the Participant’s estate) at any time within a period
of one year from the date of such Termination, but in no event beyond the
expiration of the stated term of such Stock Options; provided, however, that in
the case of Retirement, if the Participant dies within such exercise period,
all unexercised Stock Options held by such Participant shall thereafter be
exercisable, to the extent to which they were exercisable at the time of death,
for a period of one year from the date of such death, but in no event beyond
the expiration of the stated term of such Stock Options.

 

(g)                                 Involuntary
Termination Without Cause.  Unless
otherwise determined by the Committee at grant, or if no rights of the
Participant are reduced, thereafter, if a Participant’s Termination is by
involuntary termination without Cause, all Stock Options that are held by such
Participant that are vested and exercisable at the time of the Participant’s
Termination may be exercised by the Participant at any time within a period of
90 days from the date of such Termination, but in no event beyond the
expiration of the stated term of such Stock Options.

 

(h)                                 Voluntary
Termination.  Unless otherwise
determined by the Committee at grant, or if no rights of the Participant are
reduced, thereafter, if a Participant’s Termination is voluntary (other than a
voluntary termination described in subsection (i)(y) below), all Stock
Options that are held by such Participant that are vested and exercisable at
the time of the Participant’s Termination may be exercised by the Participant
at any time within a period of 30 days from the date of such Termination, but
in no event beyond the expiration of the stated term of such Stock Options.

 

(i)                                     Termination
for Cause.  Unless otherwise
determined by the Committee at grant, or if no rights of the Participant are
reduced, thereafter, if a Participant’s Termination (x) is for Cause or (y) is
a voluntary Termination (as provided in sub-section (h) above) after
the occurrence of an event that would be grounds for a Termination for Cause,
all Stock Options, whether vested or not vested, that are held by such
Participant shall thereupon terminate and expire as of the date of such
Termination.

 

15

 

(j)                                     Unvested
Stock Options.  Unless otherwise
determined by the Committee at grant, or if no rights of the Participant are
reduced, thereafter, Stock Options that are not vested as of the date of a
Participant’s Termination for any reason shall terminate and expire as of the
date of such Termination.

 

(k)                                  Incentive
Stock Option Limitations.  To the
extent that the aggregate Fair Market Value (determined as of the time of
grant) of the Common Stock with respect to which Incentive Stock Options are
exercisable for the first time by an Eligible Employee during any calendar year
under this Plan and/or any other stock option plan of the Company, any
Subsidiary or any Parent exceeds $100,000, such Options shall be treated as Non-Qualified
Stock Options.  Should any provision of
this Plan not be necessary in order for the Stock Options to qualify as
Incentive Stock Options, or should any additional provisions be required, the
Committee may, in its sole discretion, amend this Plan accordingly, without the
necessity of obtaining the approval of the stockholders of the Company.

 

(l)                                     Form,
Modification, Extension and Renewal of Stock Options.  Subject to the terms and conditions and
within the limitations of this Plan, Stock Options shall be evidenced by such
form of agreement or grant as is approved by the Committee, and the Committee
may, in its sole discretion (i) modify, extend or renew outstanding Stock
Options granted under this Plan (provided that the rights of a Participant are
not reduced without his or her consent), and (ii) accept the surrender of
outstanding Stock Options (up to the extent not theretofore exercised) and
authorize the granting of new Stock Options in substitution therefor (to the
extent not theretofore exercised).  Notwithstanding the foregoing, an outstanding
Option may not be modified to reduce the exercise price thereof nor may a new
Option at a lower price be substituted for a surrendered Option (other than
adjustments or substitutions in accordance with Section 4.2), unless such
action is approved by the stockholders of the Company.

 

(m)                               Buyout
and Settlement Provisions.  The
Committee may at any time offer to buy out an Option previously granted, based
on such terms and conditions as the Committee shall establish and communicate
to the Participant at the time that such offer is made.

 

(n)                                 Early
Exercise.  The Committee may provide
that a Stock Option include a provision whereby the Participant may elect at
any time before the Participant’s Termination to exercise the Stock Option as
to any part or all of the shares of Common Stock subject to the Stock Option
prior to the full vesting of the Stock Option and such shares shall be subject
to the provisions of Article VIII and treated as Restricted Stock.  Any unvested shares of Common Stock so
purchased may be subject to a repurchase option in favor of the Company or to
any other restriction the Committee determines to be appropriate.

 

16

 

(o)                                 Other
Terms and Conditions.  Stock Options
may contain such other provisions, which shall not be inconsistent with any of
the terms of this Plan, as the Committee shall, in its sole discretion, deem
appropriate including, without limitation, permitting “reloads” that provide for
the grant of Stock Options equal to the number of shares used to pay for the
exercise price of Stock Options or shares used to pay withholding taxes (“Reloads”).  With respect to Reloads, the exercise price
of the new Stock Option shall be the Fair Market Value on the date of the “reload”
and the term of the Stock Option shall be the same as the remaining term of the
Stock Options that are exercised, if applicable, or such other exercise price
and term as determined by the Committee, in its sole discretion.

 

ARTICLE VII

STOCK APPRECIATION RIGHTS

 

7.1                               Tandem Stock Appreciation Rights.  Stock Appreciation Rights may be granted in
conjunction with all or part of any Stock Option (a “Reference Stock Option”)
granted under this Plan (“Tandem Stock Appreciation Rights”).  In the case of a Non-Qualified Stock Option,
such rights may be granted either at or after the time of the grant of such
Reference Stock Option.  In the case of
an Incentive Stock Option, such rights may be granted only at the time of the
grant of such Reference Stock Option.

 

7.2                               Terms and Conditions of Tandem Stock Appreciation
Rights.  Tandem Stock
Appreciation Rights granted hereunder shall be subject to such terms and
conditions, not inconsistent with the provisions of this Plan, as shall be
determined from time to time by the Committee in its sole discretion, and the
following:

 

(a)                                  Term.  A Tandem Stock Appreciation Right or
applicable portion thereof granted with respect to a Reference Stock Option
shall terminate and no longer be exercisable upon the termination or exercise
of the Reference Stock Option, except that, unless otherwise determined by the
Committee, in its sole discretion, at the time of grant, a Tandem Stock
Appreciation Right granted with respect to less than the full number of shares
covered by the Reference Stock Option shall not be reduced until and then only
to the extent the exercise or termination of the Reference Stock Option causes
the number of shares covered by the Tandem Stock Appreciation Right to exceed
the number of shares remaining available and unexercised under the Reference
Stock Option.

 

(b)                                 Exercisability.  Tandem Stock Appreciation Rights shall be
exercisable only at such time or times and to the extent that the Reference
Stock Options to which they relate shall be exercisable in accordance with the
provisions of Article VI, and shall be subject to the provisions of Section 6.4(c).

 

17

 

(c)                                  Method
of Exercise.  A Tandem Stock
Appreciation Right may be exercised by the Participant by surrendering the
applicable portion of the Reference Stock Option.  Upon such exercise and surrender, the
Participant shall be entitled to receive an amount determined in the manner
prescribed in this Section 7.2. 
Stock Options which have been so surrendered, in whole or in part, shall
no longer be exercisable to the extent the related Tandem Stock Appreciation
Rights have been exercised.

 

(d)                                 Payment.  Upon the exercise of a Tandem Stock
Appreciation Right a Participant shall be entitled to receive up to, but no
more than, a number of shares of Common Stock equal in value to the excess of
the Fair Market Value of one share of Common Stock over the Option exercise price
per share specified in the Reference Stock Option agreement multiplied by the
number of shares in respect of which the Tandem Stock Appreciation Right shall
have been exercised.

 

(e)                                  Deemed
Exercise of Reference Stock Option. 
Upon the exercise of a Tandem Stock Appreciation Right, the Reference
Stock Option or part thereof to which such Stock Appreciation Right is related
shall be deemed to have been exercised for the purpose of the limitation set
forth in Article IV of the Plan on the number of shares of Common Stock to
be issued under the Plan.

 

(f)                                    Non-Transferability.  Tandem Stock Appreciation Rights shall be
Transferable only when and to the extent that the underlying Stock Option would
be Transferable under Section 6.4(e) of the Plan.

 

7.3                               Non-Tandem Stock Appreciation Rights.  Non-Tandem Stock Appreciation Rights may also
be granted without reference to any Stock Options granted under this Plan.

 

7.4                               Terms and Conditions of Non-Tandem Stock Appreciation
Rights.  Non-Tandem Stock
Appreciation Rights granted hereunder shall be subject to such terms and
conditions, not inconsistent with the provisions of this Plan, as shall be
determined from time to time by the Committee in its sole discretion, and the
following:

 

(a)                                  Term.  The term of each Non-Tandem Stock
Appreciation Right shall be fixed by the Committee, but shall not be greater
than 10 years after the date the right is granted.

 

(b)                                 Exercisability.  Non-Tandem Stock Appreciation Rights shall be
exercisable at such time or times and subject to such terms and conditions as
shall be determined by the Committee at grant. 
If the Committee provides, in its discretion, that any such right is
exercisable subject to certain limitations (including, without limitation, that
it is exercisable only in installments or within certain time periods), the
Committee may waive such limitations on the exercisability at any time at or
after grant in whole or in part (including, without limitation, waiver of the
installment exercise

 

18

 

provisions or acceleration of
the time at which such right may be exercised), based on such factors, if any,
as the Committee shall determine, in its sole discretion.  Unless otherwise determined by the Committee
at grant, the Award agreement shall provide that (i) in the event the
Participant engages in Detrimental Activity prior to any exercise of the
Non-Tandem Stock Appreciation Right, all Non-Tandem Stock Appreciation Rights
held by the Participant shall thereupon terminate and expire, (ii) as a
condition of the exercise of a Non-Tandem Stock Appreciation Right, the
Participant shall be required to certify (or shall be deemed to have certified)
at the time of exercise in a manner acceptable to the Company that the
Participant is in compliance with the terms and conditions of the Plan and that
the Participant has not engaged in, and does not intend to engage in, any
Detrimental Activity, and (iii) in the event the Participant engages in
Detrimental Activity during the one year period commencing on the later of the date
the Non-Tandem Stock Appreciation Right is exercised or becomes vested, the
Company shall be entitled to recover from the Participant at any time within
one year after such exercise or vesting, and the Participant shall pay over to
the Company, an amount equal to any gain realized as a result of the exercise
(whether at the time of exercise or thereafter).

 

(c)                                  Method
of Exercise.  Subject to whatever
installment exercise and waiting period provisions apply under subsection (b) above,
Non-Tandem Stock Appreciation Rights may be exercised in whole or in part at
any time in accordance with the applicable Award agreement, by giving written
notice of exercise to the Company specifying the number of Non-Tandem Stock
Appreciation Rights to be exercised.

 

(d)                                 Payment.  Upon the exercise of a Non-Tandem Stock
Appreciation Right a Participant shall be entitled to receive, for each right
exercised, up to, but no more than, a number of shares of Common Stock equal in
value to the excess of the Fair Market Value of one share of Common Stock on
the date the right is exercised over the Fair Market Value of one share of
Common Stock on the date the right was awarded to the Participant.

 

(e)                                  Non-Transferability.  No Non-Tandem Stock Appreciation Rights shall
be Transferable by the Participant otherwise than by will or by the laws of
descent and distribution, and all such rights shall be exercisable, during the
Participant’s lifetime, only by the Participant.

 

7.5                               Limited Stock Appreciation Rights.  The Committee may, in its sole discretion,
grant Tandem and Non-Tandem Stock Appreciation Rights either as a general Stock
Appreciation Right or as a Limited Stock Appreciation Right.  Limited Stock Appreciation Rights may be
exercised only upon the occurrence of a Change in Control or such other event
as the Committee may, in its sole discretion, designate at the time of grant or
thereafter.  Upon the exercise of Limited
Stock Appreciation Rights, except as otherwise provided in an Award agreement,
the Participant shall receive a number of shares of Common Stock equal to the

 

19

 

amount (i) set forth in Section 7.2(d) with
respect to Tandem Stock Appreciation Rights or (ii) set forth in Section 7.4(d) with
respect to Non-Tandem Stock Appreciation Rights.

 

ARTICLE VIII

RESTRICTED STOCK

 

8.1                               Awards
of Restricted Stock.  Shares of
Restricted Stock may be issued either alone or in addition to other Awards
granted under the Plan.  The Committee
shall, in its sole discretion, determine the Eligible Employees, Consultants
and Non-Employee Directors, to whom, and the time or times at which, grants of
Restricted Stock shall be made, the number of shares to be awarded, the price
(if any) to be paid by the Participant (subject to Section 8.2), the time
or times within which such Awards may be subject to forfeiture, the vesting schedule and
rights to acceleration thereof, and all other terms and conditions of the
Awards.

 

Unless otherwise determined by the Committee at grant, each Award of
Restricted Stock shall provide that in the event the Participant engages in
Detrimental Activity prior to, or during the one year period after, any vesting
of Restricted Stock, the Committee may direct that all unvested Restricted
Stock shall be immediately forfeited to the Company and that the Participant
shall pay over to the Company an amount equal to the Fair Market Value at the
time of vesting of any Restricted Stock which had vested in the period referred
to above.

 

The Committee may condition the grant or vesting of Restricted Stock
upon the attainment of specified performance goals set forth on Exhibit A as
the Committee may determine in its sole discretion.

 

8.2                               Awards
and Certificates.  Eligible
Employees, Consultants and Non-Employee Directors selected to receive
Restricted Stock shall not have any rights with respect to such Award, unless
and until such Participant has delivered a fully executed copy of the agreement
evidencing the Award to the Company and has otherwise complied with the
applicable terms and conditions of such Award. 
Further, such Award shall be subject to the following conditions:

 

(a)                                  Purchase
Price.  The purchase price of
Restricted Stock shall be fixed by the Committee.  Subject to Section 4.3, the purchase
price for shares of Restricted Stock may be zero to the extent permitted by
applicable law, and, to the extent not so permitted, such purchase price may
not be less than par value.

 

(b)                                 Acceptance.  Awards of Restricted Stock must be accepted
within a period of 60 days (or such other period as the Committee may specify)
after the grant date, by executing a Restricted Stock agreement and by paying
whatever price (if any) the Committee has designated thereunder.

 

(c)                                  Legend.  Each Participant receiving Restricted Stock
shall be issued a stock certificate in respect of such shares of Restricted
Stock, unless the Committee elects to use another system, such as book entries
by the transfer agent, as evidencing ownership of shares of Restricted Stock.  Such certificate shall be registered in the
name of such Participant, and

 

20

 

shall, in addition to such
legends required by applicable securities laws, bear an appropriate legend
referring to the terms, conditions, and restrictions applicable to such Award,
substantially in the following form:

 

“The anticipation, alienation, attachment, sale, transfer, assignment,
pledge, encumbrance or charge of the shares of stock represented hereby are
subject to the terms and conditions (including forfeiture) of the Maidenform
Brands, Inc. (the “Company”) 2005 Stock Incentive Plan (the “Plan”) and an
Agreement entered into between the registered owner and the Company dated                     .  Copies of such Plan and Agreement are on file
at the principal office of the Company.”

 

(d)                                 Custody.  If stock certificates are issued in respect
of shares of Restricted Stock, the Committee may require that any stock
certificates evidencing such shares be held in custody by the Company until the
restrictions thereon shall have lapsed, and that, as a condition of any grant
of Restricted Stock, the Participant shall have delivered a duly signed stock
power, endorsed in blank, relating to the Common Stock covered by such Award.

 

8.3                               Restrictions
and Conditions.  The shares of
Restricted Stock awarded pursuant to this Plan shall be subject to the
following restrictions and conditions:

 

(a)                                  Restriction
Period.  (i)  The Participant
shall not be permitted to Transfer shares of Restricted Stock awarded under
this Plan during the period or periods set by the Committee (the “Restriction
Period”) commencing on the date of such Award, as set forth in the Restricted
Stock Award agreement and such agreement shall set forth a vesting schedule and
any events which would accelerate vesting of the shares of Restricted Stock.  Within these limits, based on service,
attainment of performance goals pursuant to Section 8.3(a)(ii) below
and/or such other factors or criteria as the Committee may determine in its
sole discretion, the Committee may condition the grant or provide for the lapse
of such restrictions in installments in whole or in part, or may accelerate the
vesting of all or any part of any Restricted Stock Award and/or waive the
deferral limitations for all or any part of any Restricted Stock Award.

 

(ii)                                  Objective Performance Goals, Formulae or Standards.  If the grant of shares of Restricted Stock or
the lapse of restrictions is based on the attainment of performance goals, the
Committee shall, in its sole discretion, establish the objective performance
goals and the applicable vesting percentage of the Restricted Stock applicable
to each Participant or class of Participants in writing prior to the beginning
of the applicable fiscal year or at such later date as otherwise determined by
the Committee in its sole discretion and while the outcome of the performance
goals are substantially uncertain.  Such
performance goals may incorporate provisions for disregarding (or adjusting
for) changes in accounting

 

21

 

methods, corporate transactions
(including, without limitation, dispositions and acquisitions) and other
similar type events or circumstances. 
The applicable performance goals shall be based on one or more of the
performance goals set forth in Exhibit A hereto or such other goals
established by the Committee in its sole discretion.

 

(b)                                 Rights
as a Stockholder.  Except as provided
in this subsection (b) and subsection (a) above and as
otherwise determined by the Committee, the Participant shall have, with respect
to the shares of Restricted Stock, all of the rights of a holder of shares of
Common Stock of the Company including, without limitation, the right to receive
any dividends, the right to vote such shares and, subject to and conditioned
upon the full vesting of shares of Restricted Stock, the right to tender such
shares.  The Committee may, in its sole
discretion, determine at the time of grant that the payment of dividends shall
be deferred until, and conditioned upon, the expiration of the applicable
Restriction Period.

 

(c)                                  Termination.  Unless otherwise determined by the Committee
at grant or, if no rights of the Participant are reduced, thereafter, subject
to the applicable provisions of the Restricted Stock Award agreement and this
Plan, upon a Participant’s Termination for any reason during the relevant
Restriction Period, all Restricted Stock still subject to restriction will vest
or be forfeited in accordance with the terms and conditions established by the
Committee at grant or thereafter.

 

(d)                                 Lapse
of Restrictions.  If and when the
Restriction Period expires without a prior forfeiture of the Restricted Stock,
the certificates for such shares shall be delivered to the Participant.  All legends shall be removed from said
certificates at the time of delivery to the Participant, except as otherwise
required by applicable law or other limitations imposed by the Committee.

 

ARTICLE IX

PERFORMANCE SHARES

 

9.1                               Award
of Performance Shares. 
Performance Shares may be awarded either alone or in addition to other
Awards granted under this Plan.  The
Committee shall, in its sole discretion, determine the Eligible Employees,
Consultants and Non-Employee Directors, to whom, and the time or times at
which, Performance Shares shall be awarded, the number of Performance Shares to
be awarded to any person, the duration of the period (the “Performance Period”)
during which, and the conditions under which, receipt of the Shares will be
deferred, and the other terms and conditions of the Award in addition to those
set forth in Section 9.2.

 

Unless otherwise determined by the Committee at grant, each Award of
Performance Shares shall provide that in the event the Participant engages in
Detrimental Activity prior to, or during the one year period after, any vesting
of Performance Shares, the Committee may direct

 

22

 

(at any time within one year thereafter) that
all unvested Performance Shares shall be immediately forfeited to the Company
and that the Participant shall pay over to the Company an amount equal to any
gain the Participant realized from any Performance Shares which had vested in
the period referred to above.

 

Except as otherwise provided herein, the Committee shall condition the
right to payment of any Performance Share upon the attainment of objective performance
goals established pursuant to Section 9.2(c) below.

 

9.2                               Terms
and Conditions.  Performance
Shares awarded pursuant to this Article IX shall be subject to the
following terms and conditions:

 

(a)                                  Earning
of Performance Share Award.  At the
expiration of the applicable Performance Period, the Committee shall determine
the extent to which the performance goals established pursuant to Section 9.2(c) are
achieved and the percentage of each Performance Share Award that has been
earned.

 

(b)                                 Non-Transferability.  Subject to the applicable provisions of the
Award agreement and this Plan, Performance Shares may not be Transferred during
the Performance Period.

 

(c)                                  Objective
Performance Goals, Formulae or Standards. 
The Committee shall, in its sole discretion, establish the objective
performance goals for the earning of Performance Shares based on a Performance
Period applicable to each Participant or class of Participants in writing prior
to the beginning of the applicable Performance Period or at such later date
while the outcome of the performance goals are substantially uncertain.  Such performance goals may incorporate provisions
for disregarding (or adjusting for) changes in accounting methods, corporate
transactions (including, without limitation, dispositions and acquisitions) and
other similar type events or circumstances. 
The applicable performance goals shall be based on one or more of the
performance goals set forth in Exhibit A hereto or such other goals
established by the Committee in it sole discretion.

 

(d)                                 Dividends.  Unless otherwise determined by the Committee
at the time of grant, amounts equal to any dividends declared during the
Performance Period with respect to the number of shares of Common Stock covered
by a Performance Share will not be paid to the Participant.

 

(e)                                  Payment.  Following the Committee’s determination in
accordance with subsection (a) above, shares of Common Stock or, as
determined by the Committee in its sole discretion, the cash equivalent of such
shares shall be delivered to the Eligible Employee, Consultant or Non-Employee
Director, or his legal representative, in an amount equal to such individual’s
earned Performance Share. 
Notwithstanding the foregoing,

 

23

 

the Committee may, in its sole
discretion, award an amount less than the earned Performance Share and/or
subject the payment of all or part of any Performance Share to additional
vesting, forfeiture and deferral conditions as it deems appropriate.

 

(f)                                    Termination.  Subject to the applicable provisions of the
Award agreement and this Plan, upon a Participant’s Termination for any reason
during the Performance Period for a given Award, the Performance Shares in
question will vest or be forfeited in accordance with the terms and conditions
established by the Committee at grant.

 

(g)                                 Accelerated
Vesting.  Based on service,
performance and/or such other factors or criteria, if any, as the Committee may
determine, the Committee may, in its sole discretion, at or after grant,
accelerate the vesting of all or any part of any Performance Share Award and/or
waive the deferral limitations for all or any part of such Award.

 

ARTICLE X

OTHER STOCK-BASED AWARDS

 

10.1                        Other
Awards.  The Committee, in its
sole discretion,  is authorized to grant
to Eligible Employees, Consultants and Non-Employee Directors Other Stock-Based
Awards that are payable in, valued in whole or in part by reference to, or
otherwise based on or related to shares of Common Stock, including but not
limited to, shares of Common Stock awarded purely as a bonus and not subject to
any restrictions or conditions, shares of Common Stock in payment of the
amounts due under an incentive or performance plan sponsored or maintained by the
Company or an Affiliate, stock equivalent units, restricted stock units, deferred
stock units, and Awards valued by reference to book value of shares of Common
Stock.  The Committee may, in its sole
discretion, permit Non-Employee Directors to defer all or a portion of their
cash compensation in the form of Other Stock-Based Awards granted under this
Plan, subject to the terms and conditions of any deferred compensation
arrangement established by the Company.  Other
Stock-Based Awards may be granted either alone or in addition to or in tandem
with other Awards granted under the Plan.

 

Subject to the provisions of this Plan, the Committee shall, in its
sole discretion, have authority to determine the Eligible Employees,
Consultants and Non-Employee Directors, to whom, and the time or times at
which, such Awards shall be made, the number of shares of Common Stock to be
awarded pursuant to such Awards, and all other conditions of the Awards.  The Committee may also provide for the grant
of Common Stock under such Awards upon the completion of a specified
performance period.

 

The Committee may condition the grant or vesting of Other Stock-Based
Awards upon the attainment of specified performance goals set forth on Exhibit A
as the Committee may determine, in its sole discretion.

 

24

 

10.2                        Terms
and Conditions.  Other
Stock-Based Awards made pursuant to this Article X shall be subject to the
following terms and conditions:

 

(a)                                  Non-Transferability.  Subject to the applicable provisions of the
Award agreement and this Plan, shares of Common Stock subject to Awards made
under this Article X may not be Transferred prior to the date on which the
shares are issued, or, if later, the date on which any applicable restriction,
performance or deferral period lapses.

 

(b)                                 Dividends.  Unless otherwise determined by the Committee
at the time of Award, subject to the provisions of the Award agreement and this
Plan, the recipient of an Award under this Article X shall not be entitled
to receive, currently or on a deferred basis, dividends or dividend equivalents
with respect to the number of shares of Common Stock covered by the Award.

 

(c)                                  Vesting.  Any Award under this Article X and any
Common Stock covered by any such Award shall vest or be forfeited to the extent
so provided in the Award agreement, as determined by the Committee, in its sole
discretion.

 

(d)                                 Price.  Common Stock issued on a bonus basis under
this Article X may be issued for no cash consideration; Common Stock purchased
pursuant to a purchase right awarded under this Article X shall be priced,
as determined by the Committee in its sole discretion.

 

ARTICLE XI

CHANGE IN CONTROL PROVISIONS

 

11.1                        Benefits.  In the event of a Change in Control of the
Company , and except as otherwise provided by the Committee in an Award
agreement, a Participant’s unvested Award shall not vest and a Participant’s
Award shall be treated in accordance with one of the following methods as
determined by the Committee in its sole discretion:

 

(a)                                  Awards,
whether or not then vested, shall be continued, assumed, have new rights
substituted therefor or be treated in accordance with Section 4.2(d) hereof,
as determined by the Committee in its sole discretion, and restrictions to
which any shares of Restricted Stock or any other Award granted prior to the
Change in Control are subject shall not lapse upon a Change in Control and the
Restricted Stock or other Award shall, where appropriate in the sole discretion
of the Committee, receive the same distribution as other Common Stock on such
terms as determined by the Committee; provided that, the Committee may, in its
sole discretion, decide to award additional Restricted Stock or other Award in
lieu of any cash distribution. 
Notwithstanding anything to the contrary herein, for purposes of
Incentive Stock Options, any assumed or substituted Stock

 

25

 

Option shall comply with the
requirements of Treasury Regulation §  1.424-1 (and any amendments thereto).

 

(b)                                 The
Committee, in its sole discretion, may provide for the purchase of any Awards by
the Company or an Affiliate for an amount of cash equal to the excess of the
Change in Control Price (as defined below) of the shares of Common Stock
covered by such Awards, over the aggregate exercise price of such Awards.  For purposes of this Section 11.1,
Change in Control Price shall mean the highest price per share of Common Stock
paid in any transaction related to a Change in Control of the Company.

 

(c)                                  Notwithstanding
anything else herein, the Committee may, in its sole discretion, provide for
accelerated vesting or lapse of restrictions, of an Award at any time.

 

11.2                        Change
in Control.  Unless otherwise
determined by the Committee in the applicable Award agreement or other written
agreement approved by the Committee, a “Change in Control” shall be deemed to
occur following any transaction if: (i) any “person” as such term is used
in Sections 13(d) and 14(d) of the Exchange Act (other than the
Company, any Ares Person, any trustee or other fiduciary holding securities
under any employee benefit plan of the Company, or any company owned, directly
or indirectly, by the stockholders of the Company in substantially the same
proportions as their ownership of Common Stock of the Company), becomes the “beneficial
owner” (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of 50% or more of the combined voting power of the then outstanding
securities of the Company (or its successor corporation); provided, however,
that a merger or consolidation effected solely to implement a recapitalization
of the Company  shall not constitute a
Change in Control of the Company; or (ii) the stockholders of the Company
approve a plan of complete liquidation of the Company or the consummation of
the sale or disposition by the Company of all or substantially all of the
Company’s assets other than (x) the sale or disposition of all or substantially
all of the assets of the Company to a person or persons who beneficially own,
directly or indirectly, at least 50% or more of the combined voting power of
the outstanding voting securities of the Company at the time of the sale or (y)
pursuant to a spinoff type transaction, directly or indirectly, of such assets
to the stockholders of the Company.

 

Notwithstanding the foregoing, for purposes of the Plan the
Registration Date shall not be considered a Change in Control.

 

ARTICLE XII

TERMINATION OR AMENDMENT OF PLAN

 

12.1                        Termination
or Amendment.  Notwithstanding
any other provision of this Plan, the Board may at any time, and from time to
time, amend, in whole or in part, any or all of the provisions of the Plan
(including any amendment deemed necessary to ensure that the Company may comply
with any regulatory requirement referred to in Article XIV), or suspend or
terminate it entirely, retroactively or otherwise; provided, that without the
approval of the holders of the

 

26

 

Company’s Common Stock entitled
to vote in accordance with applicable law, no amendment may be made that would:

 

(a)                                  increase
the aggregate number of shares of Common Stock that may be issued under this
Plan (except by operation of Section 4.2);

 

(b)                                 change
the classification of individuals eligible to receive Awards under this Plan;

 

(c)                                  extend
the maximum option period under Section 6.4;

 

(d)                                 materially
alter the performance goals for Restricted Stock, Performance Shares or Other
Stock-Based Awards as set forth in Exhibit A; or

 

(e)                                  require
stockholder approval in order for this Plan to comply with the applicable rules of
any exchange or system on which the Company’s securities are listed or traded
at the request of the Company, the applicable provisions of Section 162(m)
of the Code or, to the extent applicable to Incentive Stock Options, Section 422
of the Code.

 

ARTICLE XIII

 

UNFUNDED PLAN

 

13.1                        Unfunded
Status of Plan.  This Plan is an “unfunded”
plan for incentive and deferred compensation. 
With respect to any payments as to which a Participant has a fixed and
vested interest but that are not yet made to a Participant by the Company,
nothing contained herein shall give any such Participant any rights that are
greater than those of a general unsecured creditor of the Company.

 

ARTICLE XIV

GENERAL PROVISIONS

 

14.1                        Legend.  The Committee may require each person
receiving shares of Common Stock pursuant to a Stock Option or other Award
under the Plan to represent to and agree with the Company in writing that the
Participant is acquiring the shares without a view to distribution
thereof.  In addition to any legend
required by this Plan, the certificates for such shares may include any legend
that the Committee, in its sole discretion, deems appropriate to reflect any
restrictions on Transfer.

 

All certificates for shares of Common Stock delivered under the Plan
shall be subject to such stop transfer orders and other restrictions as the
Committee may, in its sole discretion, deem advisable under the rules,
regulations and other requirements of the Securities and Exchange Commission,
any stock exchange upon which the Common Stock is then listed or any national
securities exchange system upon whose system the Common Stock is then quoted,
any applicable Federal or state securities law, and any applicable corporate law,
and the Committee

 

27

 

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

 

14.2                        Other
Plans.  Nothing contained in this
Plan shall prevent the Board from adopting other or additional compensation
arrangements, subject to stockholder approval if such approval is required; and
such arrangements may be either generally applicable or applicable only in
specific cases.

 

14.3                        No
Right to Employment/Directorship/Consultancy.  Neither this Plan nor the grant of any Option
or other Award hereunder shall give any Participant or other employee,
Consultant or Non-Employee Director any right with respect to continuance of
employment, consultancy or directorship by the Company or any Affiliate, nor
shall they be a limitation in any way on the right of the Company or any
Affiliate by which an employee is employed or a Consultant or Non-Employee
Director is retained to terminate his or her employment, consultancy or
directorship at any time.

 

14.4                        Withholding
of Taxes.  The Company shall have
the right to deduct from any payment to be made pursuant to this Plan, or to
otherwise require, prior to the issuance or delivery of any shares of Common
Stock or the payment of any cash hereunder, payment by the Participant of, any
Federal, state or local taxes required by law to be withheld.  Upon the vesting of Restricted Stock (or
other Award that is taxable upon vesting), or upon making an election under Section 83(b) of
the Code, a Participant shall pay all required withholding to the Company.  Any statutorily required withholding
obligation with regard to any Participant may be satisfied, subject to the
consent of the Committee, by reducing the number of shares of Common Stock
otherwise deliverable or by delivering shares of Common Stock already
owned.  Any fraction of a share of Common
Stock required to satisfy such tax obligations shall be disregarded and the
amount due shall be paid instead in cash by the Participant.

 

14.5                        No
Assignment of Benefits.  No Award
or other benefit payable under this Plan shall, except as otherwise
specifically provided by law or permitted by the Committee, be Transferable in
any manner, and any attempt to Transfer any such benefit shall be void, and any
such benefit shall not in any manner be liable for or subject to the debts,
contracts, liabilities, engagements or torts of any person who shall be
entitled to such benefit, nor shall it be subject to attachment or legal
process for or against such person.

 

14.6                        Listing
and Other Conditions.

 

(a)                                  Unless
otherwise determined by the Committee, as long as the Common Stock is listed on
a national securities exchange or system sponsored by a national securities
association, the issue of any shares of Common Stock pursuant to an Award shall
be conditioned upon such shares being listed on such exchange or system.  The Company shall have no obligation to issue
such shares unless and until such shares are so listed, and the right to

 

28

 

exercise any Option or other
Award with respect to such shares shall be suspended until such listing has
been effected.

 

(b)                                 If
at any time counsel to the Company shall be of the opinion that any sale or
delivery of shares of Common Stock pursuant to an Option or other Award is or
may in the circumstances be unlawful or result in the imposition of excise
taxes on the Company under the statutes, rules or regulations of any
applicable jurisdiction, the Company shall have no obligation to make such sale
or delivery, or to make any application or to effect or to maintain any
qualification or registration under the Securities Act or otherwise, with
respect to shares of Common Stock or Awards, and the right to exercise any Option
or other Award shall be suspended until, in the opinion of said counsel, such
sale or delivery shall be lawful or will not result in the imposition of excise
taxes on the Company.

 

(c)                                  Upon
termination of any period of suspension under this Section 14.6, any Award
affected by such suspension which shall not then have expired or terminated
shall be reinstated as to all shares available before such suspension and as to
shares which would otherwise have become available during the period of such
suspension, but no such suspension shall extend the term of any Award.

 

(d)                                 A
Participant shall be required to supply the Company with any certificates,
representations and information that the Company requests and otherwise
cooperate with the Company in obtaining any listing, registration,
qualification, exemption, consent or approval the Company deems necessary or
appropriate.

 

14.7                        Stockholders
Agreement and Other Requirements. 
Notwithstanding anything herein to the contrary, prior to the
Registration Date, as a condition to the receipt of shares of Common Stock
pursuant to an Award under this Plan, to the extent required by the Committee,
the Participant shall execute and deliver a stockholder’s agreement or such
other documentation which shall set forth certain restrictions on
transferability of the shares of Common Stock acquired upon exercise or
purchase, and such other terms as the Board or Committee shall from time to
time establish.  Such stockholder’s
agreement or other documentation shall apply to the Common Stock acquired under
the Plan and covered by such stockholder’s agreement or other
documentation.  Prior to the Registration
Date, the Company may require, as a condition of exercise, the Participant to
become a party to any other existing stockholder agreement (or other
agreement).

 

14.8                        Governing
Law.  This Plan and actions taken
in connection herewith shall be governed and construed in accordance with the
laws of the State of Delaware (regardless of the law that might otherwise govern
under applicable Delaware principles of conflict of laws).

 

14.9                        Construction.  Wherever any words are used in this Plan in
the masculine gender they shall be construed as though they were also used in
the feminine gender in all cases where they would so apply, and wherever any
words are used herein in the singular form they shall be

 

29

 

construed as though they were
also used in the plural form in all cases where they would so apply.

 

14.10                 Other Benefits.  No Award granted or paid out under this Plan
shall be deemed compensation for purposes of computing benefits under any
retirement plan of the Company or its Affiliates nor affect any benefits under
any other benefit plan now or subsequently in effect under which the availability
or amount of benefits is related to the level of compensation.

 

14.11                 Costs.  The Company shall bear all expenses
associated with administering this Plan, including expenses of issuing Common
Stock pursuant to any Awards hereunder.

 

14.12                 No Right to
Same Benefits.  The provisions of
Awards need not be the same with respect to each Participant, and such Awards
to individual Participants need not be the same in subsequent years.

 

14.13                 Death/Disability.  The Committee may in its sole discretion
require the transferee of a Participant to supply it with written notice of the
Participant’s death or Disability and to supply it with a copy of the will (in
the case of the Participant’s death) or such other evidence as the Committee
deems necessary to establish the validity of the transfer of an Award.  The Committee may, in its discretion, also
require that the agreement of the transferee to be bound by all of the terms
and conditions of the Plan.

 

14.14                 Section 16(b) of
the Exchange Act.  All elections
and transactions under this Plan by persons subject to Section 16 of the
Exchange Act involving shares of Common Stock are intended to comply with any
applicable exemptive condition under Rule 16b-3.  The Committee may, in its sole discretion,
establish and adopt written administrative guidelines, designed to facilitate
compliance with Section 16(b) of the Exchange Act, as it may deem
necessary or proper for the administration and operation of this Plan and the
transaction of business thereunder.

 

14.15                 Successor and
Assigns.  The Plan shall be
binding on all successors and permitted assigns of a Participant, including,
without limitation, the estate of such Participant and the executor,
administrator or trustee of such estate.

 

14.16                 Severability
of Provisions.  If any provision
of the Plan shall be held invalid or unenforceable, such invalidity or
unenforceability shall not affect any other provisions hereof, and the Plan
shall be construed and enforced as if such provisions had not been included.

 

14.17                 Payments to
Minors, Etc.  Any benefit payable
to or for the benefit of a minor, an incompetent person or other person
incapable of receipt thereof shall be deemed paid when paid to such person’s
guardian or to the party providing or reasonably appearing to provide for the
care of such person, and such payment shall fully discharge the Committee, the
Board, the Company, its Affiliates and their employees, agents and
representatives with respect thereto.

 

14.18                 Agreement.  As a condition to the grant of an Award, if
requested by the Company and the lead underwriter of any public offering of the
Common Stock (the “Lead Underwriter”),
a Participant shall irrevocably agree not to sell, contract to sell, grant any
option to purchase, transfer the economic risk of ownership in, make any short
sale of, pledge or

 

30

 

otherwise transfer or dispose
of, any interest in any Common Stock or any securities convertible into,
derivative of, or exchangeable or exercisable for, or any other rights to
purchase or acquire Common Stock  (except
Common Stock  included in such public
offering or acquired on the public market after such offering) during such
period of time following the effective date of a registration statement of the
Company filed under the Securities Act that the Lead Underwriter shall specify
(the “Lock-up Period”).  The Participant
shall further agree to sign such documents as may be requested by the Lead
Underwriter to effect the foregoing and agree that the Company may impose
stop-transfer instructions with respect to Common Stock acquired pursuant to an
Award until the end of such Lock-up Period.

 

14.19                 Headings and
Captions.  The headings and
captions herein are provided for reference and convenience only, shall not be considered
part of the Plan, and shall not be employed in the construction of the Plan.

 

14.20                 Transition
Period.  The Plan has been
adopted by the Board prior to the occurrence of a Registration Date.  The Plan is intended to constitute a plan
described in Treasury Regulation Section 1.162-27(f)(1), pursuant to which
the deduction limits under Section 162(m) of the Code do not apply during
the applicable reliance period.

 

ARTICLE XV

EFFECTIVE DATE OF PLAN

 

The Plan shall become effective upon the date specified by the Board in
its resolution adopting the Plan, subject to the approval of the Plan by the stockholders
of the Company in accordance with the requirements of the laws of the State of
Delaware.

 

ARTICLE XVI

TERM OF PLAN

 

No Award shall be granted pursuant to the Plan on or after the tenth
anniversary of the earlier of the date the Plan is adopted or the date of
stockholder approval, but Awards granted prior to such tenth anniversary may
extend beyond that date.

 

ARTICLE XVII

NAME OF PLAN

 

This Plan shall be known as “The Maidenform Brands, Inc. 2005
Stock Incentive Plan.”

 

31

 

EXHIBIT A

PERFORMANCE GOALS

 

Performance goals established for purposes of the grant or vesting of
performance-based Awards of Restricted Stock, Other Stock-Based Awards and/or
Performance Shares shall be based on the attainment of certain target levels
of, or a specified increase or decrease (as applicable) in one or more of the
following performance goals (“Performance Goals”) or such other criteria
determined by the Committee in its sole discretion:

 

(a)                                  enterprise
value or value creation targets;

 

(b)                                 after-tax
or pre-tax profits, including without limitation as attributable to continuing
and/or other operations of the Company;

 

(c)                                  operational
cash flow or economic value added;

 

(d)                                 specified
objectives with regard to limiting the level of increase in all or a portion
of, the Company’s bank debt or other long-term or short-term public or private
debt or other similar financial obligations of the Company, which may be
calculated net of cash balances and/or other offsets and adjustments as may be
established by the Committee in its sole discretion;

 

(e)                                  earnings
per share or earnings per share from continuing operations;

 

(f)                                    sales,
revenues, net income or earnings before income tax or other exclusions;

 

(g)                                 return
on capital employed or return on invested capital;

 

(h)                                 after-tax
or pre-tax return on stockholder equity;

 

(i)                                     the
fair market value of the shares of the Company’s Common Stock;

 

(j)                                     the
growth in the value of an investment in the Company’s Common Stock assuming the
reinvestment of dividends;

 

(k)                                  a
transaction that results in the sale of stock or assets of the Company;

 

(l)                                     earnings
before interest, taxes plus amortization and depreciation; or

 

(m)                               reduction
in expenses.

 

The Committee may, in its sole discretion, also exclude, or adjust to
reflect, the impact of an event or occurrence which the Committee determines
should be appropriately excluded or adjusted, including:

 

i

 

(i)                                     restructurings,
discontinued operations, extraordinary items or events, and other unusual or
non-recurring charges;

 

(ii)                                  an
event either not directly related to the operations of the Company or not
within the reasonable control of the Company’s management; or

 

(iii)                               a
change in tax law or accounting standards required by generally accepted
accounting principles.

 

Performance goals may also be based upon individual Participant
performance goals, as determined by the Committee, in its sole discretion.

 

In addition, performance goals may be based upon the attainment of
specified goals attained by, or with respect to, the Company, or any
subsidiary, division or other operational unit or business segment of the
Company, or based upon performance under one or more of the measures described
above relative to the performance of other corporations.  The Committee may in its sole discretion:

 

(a)                                  designate
additional business criteria on which the performance goals may be based; or

 

(b)                                 adjust, modify or
amend the aforementioned business criteria.

 

 

TABLE OF CONTENTS

 

	
  ARTICLE I PURPOSE

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II DEFINITIONS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III ADMINISTRATION

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV SHARE LIMITATION

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V ELIGIBILITY

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI STOCK OPTIONS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII STOCK APPRECIATION
  RIGHTS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII RESTRICTED STOCK

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX PERFORMANCE SHARES

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE X OTHER STOCK-BASED
  AWARDS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XI CHANGE IN CONTROL
  PROVISIONS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XII TERMINATION OR
  AMENDMENT OF PLAN

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XIII UNFUNDED PLAN

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XIV GENERAL PROVISIONS

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XV EFFECTIVE DATE OF PLAN

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XVI TERM OF PLAN

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XVII NAME OF PLAN

  	
   

  	
   

  

 

i

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