Document:

Exhibit 10.4

 

TYCO ELECTRONICS LTD.

2007 STOCK AND INCENTIVE PLAN

(AMENDED AND RESTATED AS OF JUNE 22, 2009)

 

ARTICLE I

PURPOSE

 

1.1  Purpose.  The purposes of this Tyco
Electronics Ltd. 2007 Stock and Incentive Plan (Amended and Restated as of
June 22, 2009) (the “Plan”) are to promote the interests of Tyco
Electronics Ltd. (and any successor thereto) by (i) aiding in the
recruitment and retention of Directors and Employees, (ii) providing
incentives to such Directors and Employees by means of performance-related
incentives to achieve short-term and long-term performance goals, (iii) providing
Directors and Employees an opportunity to participate in the growth and
financial success of the Company, and (iv) promoting the growth and
success of the Company’s business by aligning the financial interests of
Directors and Employees with that of the other stockholders of the Company.
Toward these objectives, the Plan provides for the grant of Stock Options,
Stock Appreciation Rights, Annual Performance Bonuses, Long Term Performance
Awards and other Stock-Based Awards.

 

1.2  Effective
Dates; Shareholder Approval. 
The Plan was originally effective June 29, 2007, the date of the
dividend distribution of Tyco Electronics Ltd. shares to the Tyco
International Ltd. shareholders of record on the distribution date. The
Plan was approved by the Tyco Electronics Ltd. Board of Directors on June 4,
2007 and adopted by Tyco International Ltd., as the Company’s sole
shareholder, on June 4, 2007. The Plan was amended and restated effective
as of November 18, 2008 to ensure its compliance with Section 409A of
the Code and to make certain other clarifying changes. This amended and
restated Plan was adopted by the Board of Directors of Tyco
Electronics Ltd. on January 13, 2009 and was approved by the Company’s shareholders on June 22,
2009.

 

ARTICLE II

DEFINITIONS

 

For
purposes of the Plan, the following terms have the following meanings, unless
another definition is clearly indicated by particular usage and context:

 

“Acquired Company” means any business, corporation or
other entity acquired by the Company or any Subsidiary.

 

“Acquired Grantee” means the grantee of a stock-based
award of an Acquired Company and may include a current or former Director of an
Acquired Company.

 

“Annual Performance Bonus” means an Award of cash or Shares
granted under Section 4.4 of the Plan that is paid solely on account of
the attainment of a specified performance target in relation to one or more
Performance Measures.

 

“Award” means any form of incentive or
performance award granted under the Plan, whether singly or in combination, to
a Participant by the Committee pursuant to any terms and conditions that the
Committee may establish and set forth in the applicable Award Certificate.
Awards granted under the Plan may consist of:

 

(a)           “Stock Options” awarded pursuant to Section 4.3;

 

(b)           “Stock Appreciation Rights” awarded
pursuant to Section 4.3;

 

(c)           “Annual Performance Bonuses” awarded
pursuant to Section 4.4;

 

(d)           “Long Term Performance Awards” awarded
pursuant to Section 4.5;

 

(e)           “Other Stock-Based Awards” awarded pursuant
to Section 4.6;

 

(f)            “Director Awards” awarded pursuant to Section 4.7;
and

 

(g)           “Substitute Awards” awarded pursuant to Section 4.8.

 

 

“Award Certificate” means
the document issued, either in writing or an electronic medium, by the
Committee or its designee to a Participant evidencing the grant of an Award.

 

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

 

“Cause” means misconduct
that is willfully or wantonly harmful to the Company or any of its
Subsidiaries, monetarily or otherwise, including, without limitation, conduct
that violates the Company’s Code of ethical Conduct.

 

“Change in Control” means
the first to occur of any of the following events:

 

(a)           any “person”
(as defined in Section 13(d) and 14(d) of the Exchange Act,
excluding for this purpose, (i) the Company or any Subsidiary or (ii) any
employee benefit plan of the Company or any Subsidiary (or any person or entity
organized, appointed or established by the Company for or pursuant to the terms
of any such plan that acquires beneficial ownership of voting securities of the
Company), is or becomes the “beneficial owner” (as defined in Rule 13d-3
under the Exchange Act) directly or indirectly of securities of the Company
representing more than 30 percent of the combined voting power of the
Company’s then outstanding securities; provided, however, that no Change in
Control will be deemed to have occurred as a result of a change in ownership
percentage resulting solely from an acquisition of securities by the Company;
or

 

(b)           persons who, as
of the Effective Date constitute the Board (the “Incumbent Directors”) cease
for any reason (including without limitation, as a result of a tender offer,
proxy contest, merger or similar transaction) to constitute at least a majority
thereof, provided that any person becoming a Director of the Company subsequent
to the Effective Date shall be considered an Incumbent Director if such person’s
election or nomination for election was approved by a vote of at least
50 percent of the Incumbent Directors; but provided further, that any such
person whose initial assumption of office is in connection with an actual or
threatened proxy contest relating to the election of members of the Board or
other actual or threatened solicitation of proxies or consents by or on behalf
of a “person” (as defined in Section 13(d) and 14(d) of the
Exchange Act) other than the Board, including by reason of agreement intended
to avoid or settle any such actual or threatened contest or solicitation, shall
not be considered an Incumbent Director; or

 

(c)           consummation of
a reorganization, merger or consolidation or sale or other disposition of at
least 80 percent of the assets of the Company (a “Business Combination”),
in each case, unless, following such Business Combination, all or substantially
all of the individuals and entities who were the beneficial owners of
outstanding voting securities of the Company immediately prior to such Business
Combination beneficially own directly or indirectly more than 50 percent
of the combined voting power of the then outstanding voting securities entitled
to vote generally in the election of directors, of the company resulting from
such Business Combination (including, without limitation, a company which, as a
result of such transaction, owns the Company or all or substantially all of the
Company’s assets either directly or through one or more Subsidiaries) in
substantially the same proportions as their ownership, immediately prior to
such Business Combination, of the outstanding voting securities of the Company;
or

 

(d)           approval by the
stockholders of the Company of a complete liquidation or dissolution of the
Company;

 

provided,
however, that if and to the extent that any provision of this Plan or an Award
Certificate would cause a payment of deferred compensation that is subject to
Code Section 409A(a)(2) to be made upon the occurrence of a “Change
in Control,” or would change the timing and/or form of any payment of deferred
compensation that is subject to Code Section 409A(a)(2) upon a
specified date or event occurring after a “Change in Control” or upon a “Change
in Control Termination,” then such payment shall not be made, or such change in
timing or form of payment shall not occur, unless such “Change in Control” is
also a “change in ownership or effective control” of the Company within the
meaning of Code Section 409A(2)(A)(v) and applicable regulations and
rulings thereunder and such payment, or such associated date or event, occurs
no later than two years after the date of such “Change in Control.”

 

 

“Change in Control Termination”
means a Participant’s involuntary termination of employment that occurs during
the 12 month period immediately following a Change in Control. For this
purpose, a Participant’s involuntary termination of employment includes only
the following:

 

(a)           termination of
the Participant’s employment by the Company for any reason other than for
Cause, Disability or death;

 

(b)           termination of
the Participant’s employment by the Participant after one of the following
events, provided that the Participant’s termination of employment occurs within
one hundred and eighty (180) days after the occurrence of any such event:

 

i.              the Company (1) assigns
or causes to be assigned to the Participant duties inconsistent in any material
respect with his or her position as in effect immediately prior to the Change
in Control; (2) makes or causes to be made any material adverse change in
the Participant’s position, authority, duties or responsibilities; or (3) takes
or causes to be taken any other action which, in the reasonable judgment of the
Participant, would cause him or her to violate his or her ethical or
professional obligations (after written notice of such judgment has been
provided by the Participant to the Company and the Company has been given a
15-day period within which to cure such action), or which results in a
significant diminution in such position, authority, duties or responsibilities;
or

 

ii.             the Company, without
the Participant’s consent, (1) requires the Participant to relocate to a
principal place of employment more than fifty (50) miles from his or her
existing place of employment; or (2) reduces the Participant’s base
salary, annual bonus, or retirement, welfare, stock incentive, perquisite (if
any) and other benefits taken as a whole.

 

“Code” means the United
States Internal Revenue Code of 1986, as amended.

 

“Committee” means the
Management Development and Compensation Committee of the Board or any successor
committee or subcommittee of the Board, which committee is comprised solely of
two or more persons who are outside directors within the meaning of Section 162(m)(4)(C)(i) of
the Code and the applicable regulations and nonemployee directors within the
meaning of Rule 16b-3(b)(3) under the Exchange Act.

 

“Common Stock” means the
common stock of the Company, $.20 (U.S.) par value, and such other securities
or property as may become subject to Awards pursuant to an adjustment made
under Section 5.3 of the Plan.

 

“Company” means Tyco
Electronics Ltd., a Swiss company, or any successor thereto.

 

“Deferred Stock Unit” means a Unit granted under Section 4.6 to
acquire Shares upon Termination of Directorship or Termination of Employment,
subject to any restrictions that the Committee, in its discretion, may
determine.

 

“Director” means a member
of the Board who is a “non-employee director” within the meaning of Rule 16b-3(b)(3) under
the Exchange Act.

 

“Director
Shares” means the award of fully-vested Shares to a
Director under Section 4.6 as part of the Director’s annual compensation,
or under such circumstances as are deemed appropriate by the Board.

 

“Disabled” or “Disability”
means the inability of the Director or Employee to perform the material duties
pertaining to such Director’s directorship or such Employee’s employment due to
a physical or mental injury, infirmity or incapacity for 180 days
(including weekends and holidays) in any 365-day period. The existence or
nonexistence of a Disability shall be determined by an independent physician
selected by the Company and reasonably acceptable to the Director or Employee.
Notwithstanding the above, if and to the extent that any provision of this Plan
or an Award Certificate would cause a payment of deferred compensation that is
subject to Code Section 409A(a)(2) to be made upon the occurrence of
a “Disability” or upon a person becoming “Disabled,” or would cause a change in
the timing or form of payment of such deferred compensation upon the occurrence
of a “Disability” or upon a person becoming “Disabled,” then such payment shall
not be made, or such change in timing 

 

 

or
form of payment shall not occur, unless such “Disability” or condition of being
“Disabled” satisfies the requirements of Code Section 409A(2)(C) and
applicable regulations and rulings thereunder.

 

“Dividend Equivalent” means an amount equal to the cash
dividend or the Fair Market Value of the stock dividend that would be paid on
each Share underlying an Award if the Share were duly issued and outstanding on
the date on which the dividend is payable. Dividend Equivalents will not be
awarded in connection with stock option or Stock Appreciation Rights Awards.

 

“Effective Date” means June 22,
2009. The original effective date of the Tyco Electronics Ltd. Stock and
Incentive Plan was, June 29, 2007, the date of the dividend distribution
of Tyco Electronics Ltd. shares to the Tyco International Ltd.
shareholders of record on the distribution date.

 

“Employee” means any
individual who performs services as an officer or employee of the Company or a
Subsidiary.

 

“Exchange Act” means the
United States Securities Exchange Act of 1934, as amended.

 

“Exercise Price” means
the price of a Share, as fixed by the Committee, which may be purchased under a
Stock Option or with respect to which the amount of any payment pursuant to a
Stock Appreciation Right is determined.

 

“Fair
Market Value” of a Share means the closing sales price on the
New York Stock Exchange on the date as of which the determination of Fair
Market Value is being made or, if no sale is reported for such day, on the next
preceding day on which a sale of Shares was reported. Notwithstanding anything
to the contrary herein, the Fair Market Value of a Share will in no event be
determined to be less than par value.

 

“Fair Market Value Stock Option”
means a Stock Option the Exercise Price of which is fixed by the Committee at a
price equal to the Fair Market Value of a Share on the date of grant.

 

“GAAP” means United
States generally accepted accounting principles.

 

“Incentive
Stock Option” means a Stock Option granted under Section 4.3
of the Plan that meets the requirements of Section 422 of the Code and any
related regulations and is designated in the Award Certificate to be an
Incentive Stock Option.

 

“Key Employee” means an
Employee who is a “covered employee” within the meaning of Section 162(m)(3) of
the Code.

 

“Long Term Performance Award”
means an Award granted under Section 4.5 of the Plan that is paid solely
on account of the attainment of a specified performance target in relation to
one or more Performance Measures or other performance criteria as selected in
the discretion of the Committee.

 

“Non-Employee Director”
means any member of the Board, elected or appointed, who is not otherwise an
Employee of the Company or a Subsidiary. An individual who is elected to the
Board at an annual meeting of the stockholders of the Company will be deemed to
be a member of the Board as of the date of the meeting.

 

“Nonqualified Stock Option”
means any Stock Option granted under Section 4.3 of the Plan that is not
an Incentive Stock Option.

 

“Participant” means a
Director, Employee or Acquired Grantee who has been granted an Award under the
Plan.

 

“Performance Cycle”
means, with respect to any Award that vests based on Performance Measures, the
period of 12 months or longer over which the level of performance will be
assessed. The first Performance Cycle under the Plan will begin on such date as
is set by the Committee, in its discretion.

 

“Performance
Measure” means, with respect to any Annual Performance
Bonus or Long Term Performance Award, the business criteria selected by the
Committee to measure the level of performance of the 

 

 

Company
during the Performance Cycle. The Committee may select as the Performance
Measure for a Performance Cycle any one or combination of the following Company
measures, as interpreted by the Committee, which measures (to the extent
applicable) will be determined in accordance with GAAP:

 

(a)           Net operating
profit after taxes;

 

(b)           Net operating
profit after taxes, per Share;

 

(c)           Return on
invested capital;

 

(d)           Return on
assets or net assets;

 

(e)           Total
shareholder return;

 

(f)            Relative total
shareholder return (as compared with a peer group of the Company);

 

(g)           Earnings before
income taxes;

 

(h)           Earnings per
Share;

 

(i)            Net income;

 

(j)            Free cash flow;

 

(k)           Free cash flow
per Share;

 

(l)            Revenue (or any
component thereof); or

 

(m)          Revenue growth.

 

“Performance Unit” means
a Long Term Performance Award denominated in dollar Units.

 

“Plan” means the Tyco
Electronics Ltd. 2007 Stock and Incentive Plan (Amended and Restated as of
June 22, 2009), as it may be amended from time to time.

 

“Premium-Priced Stock Option”
means a Stock Option the Exercise Price of which is fixed by the Committee at a
price that exceeds the Fair Market Value of a Share on the date of grant.

 

“Reporting Person” means
a Director or an Employee who is subject to the reporting requirements of Section 16(a) of
the Exchange Act.

 

“Restricted
Stock” means Shares issued pursuant to Section 4.6
that are subject to any restrictions that the Committee, in its discretion, may
impose.

 

“Restricted Unit” means a
Unit granted under Section 4.6 to acquire Shares or an equivalent amount
in cash, which Unit is subject to any restrictions that the Committee, in its
discretion, may impose.

 

“Retirement” means
Termination of Employment on or after a Participant has attained age fifty-five
(55) and has completed at least five years of service with the Company and
its Subsidiaries.

 

“Securities Act” means
the United States Securities Act of 1933, as amended.

 

“Share” means a share of
Common Stock.

 

“Stock Appreciation Right”
means a right granted under Section 4.3 of the Plan to an amount in cash
or Shares equal to any difference between the Fair Market Value of the Shares
as of the date on which the right is exercised and the Exercise Price, where
the amount of Shares attributable to each Stock Appreciation Right is set forth
on or before the grant date.

 

 

“Stock-Based Award” means
an Award granted under Section 4.6 of the Plan and denominated in Shares.

 

“Stock Option” means a
right granted under Section 4.3 of the Plan to purchase from the Company a
stated number of Shares at a specified price. Stock Options awarded under the
Plan may be in the form of Incentive Stock Options or Nonqualified Stock
Options.

 

“Subsidiary” means a
subsidiary company (wherever incorporated) of the Company; provided, that in
the case of any Award that provides deferred compensation subject to Code Section 409A,
“Subsidiary” shall not include any subsidiary company as defined above unless
such company is within a controlled group of corporations with the Company as
defined in Code Sections 1563(a)(1), (2) and (3) where the
phrase “at least 50%” is substituted in each place “at least 80%” appears or is
with the Company part of a group of trades or businesses under common control
as defined in Code Section 414(c) and Treas. Reg. § 1.414(c)-2
where the phrase “at least 50%” is substituted in each place “at least 80%”
appears, provided, however, that when the relevant determination is to be based
upon legitimate business criteria (as described in Treas. Reg.
§ 1.409A-1(b)(5)(iii)(E) and § 1.409A-1(h)(3)), the phrase “at
least 20%” shall be substituted in each place “at least 50%” appears as
described above with respect to both a controlled group of corporations and
trades or business under common control.

 

“Target Amount” means the
amount of Performance Units that will be paid if the Performance Measure is
fully (100%) attained, as determined by the Committee.

 

“Target Vesting Percentage”
means the percentage of performance-based Restricted Units or Shares of
Restricted Stock that will vest if the Performance Measure is fully (100%)
attained, as determined by the Committee.

 

“Termination of Directorship”
means the date of cessation of a Director’s membership on the Board for any
reason, with or without Cause, as determined by the Company; provided, that if
and to the extent that any provision of this Plan or an Award Certificate would
cause a payment of deferred compensation that is subject to Code Section 409A(a)(2) to
be made upon the occurrence of a Termination of Directorship or would change
the timing and/or form of any payment of deferred compensation that is subject
to Code Section 409A(a)(2) upon a person’s Termination of
Directorship, then such payment shall not be made, or such change in timing
and/or form of payment shall not occur, unless such Termination of Directorship
would be deemed a “separation from service” within the meaning of Code Section 409A(a)(2)(A)(i) and
applicable regulations and rulings thereunder, and shall not include any
services provided in the capacity of an employee or otherwise.

 

“Termination of Employment”
means the date of cessation of an Employee’s employment relationship with the
Company or a Subsidiary for any reason, with or without Cause, as determined by
the Company; provided, that if and to the extent that any provision of this
Plan or an Award Certificate would cause a payment of deferred compensation
that is subject to Code Section 409A(a)(2) to be made upon the
occurrence of a Termination of Employment or would change the timing and/or
form of any payment of deferred compensation that is subject to Code Section 409A(a)(2) upon
a person’s Termination of Employment, then such payment shall not be made or
such change in timing and/or form of payment shall not occur, unless such
Termination of Employment would be deemed a “separation from service” within
the meaning of Code Section 409A(a)(2)(A)(i) and applicable
regulations and rulings thereunder.

 

“Unit” means, for
purposes of Performance Units, the potential right to an Award equal to a
specified amount denominated in such form as is deemed appropriate in the
discretion of the Committee and, for purposes of Restricted Units or Deferred
Stock Units, the potential right to acquire one Share.

 

ARTICLE III

ADMINISTRATION

 

 3.1  Committee.  The Plan will be administered by the
Committee.

 

 3.2  Authority of the Committee.  The Committee or, to the extent required by
applicable law, the Board will have the authority, in its sole and absolute
discretion and subject to the terms of the Plan, to:

 

(a)           Interpret and
administer the Plan and any instrument or agreement relating to the Plan;

 

 

(b)           Prescribe the rules and
regulations that it deems necessary for the proper operation and administration
of the Plan, and amend or rescind any existing rules or regulations
relating to the Plan;

 

(c)           Select
Employees to receive Awards under the Plan;

 

(d)           Determine the
form of an Award, the number of Shares subject to each Award, all the terms and
conditions of an Award, including, without limitation, the conditions on
exercise or vesting, the designation of Stock Options as Incentive Stock Options
or Nonqualified Stock Options, and the circumstances in which an Award may be
settled in cash or Shares or may be cancelled, forfeited or suspended, and the
terms of the Award Certificate;

 

(e)           Determine
whether Awards will be granted singly, in combination or in tandem;

 

(f)            Establish and
interpret Performance Measures (or, as applicable, other performance criteria)
in connection with Annual Performance Bonuses and Long Term Performance Awards,
evaluate the level of performance over a Performance Cycle and certify the
level of performance attained with respect to Performance Measures (or other
performance criteria, as applicable);

 

(g)           Except as
provided in Section 6.1, waive or amend any terms, conditions,
restrictions or limitations on an Award, except that the prohibition on the
repricing of Stock Options and Stock Appreciation Rights, as described in Section 4.3(g),
may not be waived and further provided that any such waiver or amendment shall
either comply with the requirements of Section 409A or preserve any
exemption from the application of Code Section 409A;

 

(h)           Make any
adjustments to the Plan (including but not limited to adjustment of the number
of Shares available under the Plan or any Award) and any Award granted under
the Plan as may be appropriate pursuant to Section 5.3;

 

(i)            Determine and
set forth in the applicable Award Certificate the circumstances under which
Awards may be deferred and the extent to which a deferral will be credited with
Dividend Equivalents and interest thereon;

 

(j)            Determine
whether a Nonqualified Stock Option or Restricted Share may be transferable to
family members, a family trust or a family partnership;

 

(k)           Establish any
subplans and make any modifications to the Plan or to Awards made hereunder
(including the establishment of terms and conditions not otherwise inconsistent
with the terms of the Plan) that the Committee may determine to be necessary or
advisable for grants made in countries outside the United States to comply
with, or to achieve favorable tax treatment under, applicable foreign laws or
regulations;

 

(l)            Appoint such
agents as it shall deem appropriate for proper administration of the Plan; and

 

(m)          Take any and
all other actions it deems necessary or advisable for the proper operation or
administration of the Plan.

 

3.3  Effect of
Determinations.  All
determinations of the Committee will be final, binding and conclusive on all
persons having an interest in the Plan.

 

3.4  Delegation of
Authority.  The Board or, if
permitted under applicable corporate law, the Committee, in its discretion and
consistent with applicable law and regulations, may delegate to the Chief
Executive Officer of the Company or any other officer or group of officers as
it deems to be advisable, the authority to select Employees to receive an Award
and to determine the number of Shares under any such Award, subject to any
terms and conditions that the Board or the Committee may establish. When the
Board or the Committee delegates authority pursuant to the foregoing sentence,
it will limit, in its discretion, the number of Shares or aggregate value that
may be subject to Awards that the delegate may grant. Only the Committee will
have authority to grant and administer Awards to Directors, Key Employees and
other Reporting Persons or to delegates of the Committee, and to establish and
certify Performance Measures.

 

 

3.5  Employment of
Advisors.  The Committee may
employ attorneys, consultants, accountants and other advisors, and the
Committee, the Company and the officers and directors of the Company may rely
upon the advice, opinions or valuations of the advisors employed.

 

3.6  No Liability.  No member of the Committee or any person
acting as a delegate of the Committee with respect to the Plan will be liable
for any losses resulting from any action, interpretation or construction made
in good faith with respect to the Plan or any Award granted under the Plan.

 

ARTICLE IV

AWARDS

 

4.1  Eligibility.  All Participants and Employees are eligible
to be designated to receive Awards granted under the Plan, except as otherwise
provided in this Article IV.

 

4.2  Form of
Awards.  Awards will be in the
form determined by the Committee, in its discretion, and will be evidenced by
an Award Certificate. Awards may be granted singly or in combination or in
tandem with other Awards.

 

4.3  Stock Options
and Stock Appreciation Rights. 
The Committee may grant Stock Options and Stock Appreciation Rights
under the Plan to those Employees whom the Committee may from time to time
select, in the amounts and pursuant to the other terms and conditions that the
Committee, in its discretion, may determine and set forth in the Award
Certificate, subject to the provisions below:

 

(a)  Form.  Stock Options granted under the Plan will, at
the discretion of the Committee and as set forth in the Award Certificate, be
in the form of Incentive Stock Options, Nonqualified Stock Options or a
combination of the two. If an Incentive Stock Option and a Nonqualified Stock
Option are granted to the same Participant under the Plan at the same time, the
form of each will be clearly identified, and they will be deemed to have been
granted in separate grants. In no event will the exercise of one Award affect
the right to exercise the other Award. Stock Appreciation Rights may be granted
either alone or in connection with concurrently or previously granted
Nonqualified Stock Options.

 

(b)  Exercise Price.  The Committee will set the Exercise Price of
Fair Market Value Stock Options or Stock Appreciation Rights granted under the Plan
at a price that is equal to the Fair Market Value of a Share on the date of
grant, subject to adjustment as provided in Section 5.3. The Committee
will set the Exercise Price of Premium-Priced Stock Options at a price that is
higher than the Fair Market Value of a Share as of the date of grant, provided
that such price is no higher than 150 percent of such Fair Market Value.
The Exercise Price of Incentive Stock Options will be equal to or greater than
110 percent of the Fair Market Value of a Share as of the date of grant if
the Participant receiving the Stock Options owns stock possessing more than
10 percent of the total combined voting power of all classes of stock of
the Company or any subsidiary or parent corporation of the Company, as defined
in Section 424 of the Code. The Exercise Price of a Stock Appreciation
Right granted in tandem with a Stock Option will equal the Exercise Price of
the related Stock Option. The Committee will set forth the Exercise Price of a
Stock Option or Stock Appreciation Right in the Award Certificate. Stock
Options granted under the Plan will, at the discretion of the Committee and as
set forth in the Award Certificate, be Fair Market Value Stock Options,
Premium-Priced Stock Options or a combination of Fair Market Value Stock
Options and Premium-Priced Stock Options.

 

(c)  Term and Timing of
Exercise.  Each Stock Option
or Stock Appreciation Right granted under the Plan will be exercisable in whole
or in part, subject to the following conditions, unless determined otherwise by
the Committee:

 

(i)            The Committee
will determine and set forth in the Award Certificate the date on which any
Award of Stock Options or Stock Appreciation Rights to a Participant may first
be exercised. Unless the applicable Award Certificate provides otherwise, a
Stock Option or Stock Appreciation Right will become exercisable in equal
annual installments over a period of four years beginning immediately after the
date on which the Stock Option or Stock Appreciation Right was granted. The
right to exercise a Stock Option or Stock Appreciation Right will lapse no
later than 10 years after the date of grant, except to the extent
necessary to comply with applicable laws outside of the United States or to
preserve the tax advantages of the Award outside the United States.

 

(ii)           Unless the
applicable Award Certificate provides otherwise, upon the death or Disability
of a

 

 

Participant who has outstanding Stock Options or Stock Appreciation
Rights, the unvested Stock Options or Stock Appreciation Rights will vest.
Unless the applicable Award Certificate provides otherwise, the Participant’s
Stock Options and Stock Appreciation Rights will lapse, and will not thereafter
be exercisable, upon the earlier of (A) their original expiration date or (B) the
date that is three years after the date on which the Participant dies, incurs a
Disability or retires.

 

(iii)          Unless the
applicable Award Certificate provides otherwise, upon the Retirement of a
Participant, a pro rata portion of the Participant’s Stock Options and Stock
Appreciation Rights will vest so that the total number of vested Stock Options
or Stock Appreciation Rights held by the Participant at Termination of
Employment (including those that have already vested as of such date) will be
equal to (A) the total number of Stock Options or Stock Appreciation
Rights originally granted to the Participant under each Award multiplied by (ii) a
fraction, the numerator of which is the period of time (in whole months) that
have elapsed since the date of grant, and the denominator of which is four
years (or such other applicable vesting term as is set forth in the Award
Certificate). Unless the Award Certificate provides otherwise, such Participant’s
Stock Options and Stock Appreciation Rights will lapse, and will not thereafter
be exercisable, upon the earlier of (A) their original expiration date or (B) the
date that is three years after the date of Termination of Employment.

 

(iv)          Upon the
Termination of Employment of a Participant that does not meet the requirements
of paragraphs (ii) or (iii) above, or as otherwise provided in Section 5.4
(Change in Control), any unvested Stock Options or Stock Appreciation Rights
will be forfeited unless the Award Certificate provides otherwise. Any Stock
Options or Stock Appreciation Rights that are vested as of such Termination of
Employment will lapse, and will not thereafter be exercisable, upon the earlier
of (A) their original expiration date or (B) the date that is ninety
(90) days after the date of such Termination of Employment unless the
Award Certificate provides otherwise.

 

(v)           Stock Options
and Stock Appreciation Rights of a deceased Participant may be exercised only
by the estate of the Participant or by the person given authority to exercise
the Stock Options or Stock Appreciation Rights by the Participant’s will or by
operation of law. If a Stock Option or Stock Appreciation Right is exercised by
the executor or administrator of a deceased Participant, or by the person or
persons to whom the Stock Option or Stock Appreciation Right has been
transferred by the Participant’s will or the applicable laws of descent and
distribution, the Company will be under no obligation to deliver Shares or cash
until the Company is satisfied that the person exercising the Stock Option or
Stock Appreciation Right is the duly appointed executor or administrator of the
deceased Participant or the person to whom the Stock Option or Stock
Appreciation Right has been transferred by the Participant’s will or by
applicable laws of descent and distribution.

 

(vi)          A Stock
Appreciation Right granted in tandem with a Stock Option is subject to the same
terms and conditions as the related Stock Option and will be exercisable only
to the extent that the related Stock Option is exercisable.

 

(d)  Payment of Exercise Price.  The Exercise Price of a Stock Option must be
paid in full when the Stock Option is exercised. Stock certificates will be
registered and delivered only upon receipt of payment. Payment of the Exercise
Price may be made in cash or by certified check, bank draft, wire transfer, or
postal or express money order, provided that the format is approved by the Company
or a designated third-party administrator. The Committee, in its discretion may
also allow payment to be made by any of the following methods, as set forth in
the Award Certificate:

 

(i)            Delivering a
properly executed exercise notice to the Company or its agent, together with
irrevocable instructions to a broker to deliver to the Company, within the
typical settlement cycle for the sale of equity securities on the relevant
trading market (or otherwise in accordance with the provisions of Regulation T
issued by the Federal Reserve Board), the amount of sale proceeds with respect
to the portion of the Shares to be acquired having a Fair Market Value on the
date of exercise equal to the sum of the applicable portion of the Exercise
Price being so paid;

 

(ii)           Tendering
(actually or by attestation) to the Company previously acquired Shares that
have been held by the Participant for at least six months, subject to
paragraph (iv), and that have a Fair Market Value on the day prior to the
date of exercise equal to the applicable portion of the Exercise Price being so
paid, provided that the Board has specifically approved the repurchase of such
Shares (unless such approval is not required by 

 

 

the
terms of the bye-laws of the Company) and the Committee has determined that, as
of the date of repurchase, the Company is, and after the repurchase will
continue to be, able to pay its liabilities as they become due; or

 

(iii)          Provided such
payment method has been expressly authorized by the Board or the Committee in advance
and subject to any requirements of applicable law and regulations, instructing
the Company to reduce the number of Shares that would otherwise be issued by
such number of Shares as have in the aggregate a Fair Market Value on the date
of exercise equal to the applicable portion of the Exercise Price being so
paid.

 

(iv)          The Committee,
in consideration of applicable accounting standards, may waive any holding
period on Shares required to tender pursuant to clause (ii).

 

(e)  Incentive Stock Options.  Incentive Stock Options granted under
the Plan will be subject to the following additional conditions, limitations
and restrictions:

 

(i)            Eligibility.  Incentive Stock Options may be granted only
to Employees of the Company or a Subsidiary that is a subsidiary or parent
corporation of the Company, within the meaning of Section 424 of the Code.

 

(ii)           Timing
of Grant.  No Incentive
Stock Option will be granted under the Plan after the 10-year anniversary of
the date on which the Plan is adopted by the Board or, if earlier, the date on
which the Plan is approved by the Company’s stockholders.

 

(iii)          Amount
of Award.  Subject to Section 5.3
of the Plan, no more than 10 million Shares may be available for grant in
the form of Incentive Stock Options. The aggregate Fair Market Value (as of the
date of grant) of the Shares with respect to which the Incentive Stock Options
awarded to any Employee first become exercisable during any calendar year may
not exceed $100,000 (U.S.). For purposes of this $100,000 (U.S.) limit, the
Employee’s Incentive Stock Options under this Plan and all other plans
maintained by the Company and its Subsidiaries will be aggregated. To the
extent any Incentive Stock Option would exceed the $100,000 (U.S.) limit, the
Incentive Stock Option will afterwards be treated as a Nonqualified Stock
Option for all purposes to the extent required by the Code and underlying
regulations and rulings.

 

(iv)          Timing
of Exercise.  If the
Committee exercises its discretion in the Award Certificate to permit an Incentive
Stock Option to be exercised by a Participant more than three months after the
Participant has ceased being an Employee (or more than 12 months if the
Participant is permanently and totally disabled, within the meaning of Section 22(e) of
the Code), the Incentive Stock Option will afterwards be treated as a
Nonqualified Stock Option to the extent required by the Code and underlying
regulations and rulings. For purposes of this paragraph (iv), an Employee’s
employment relationship will be treated as continuing intact while the Employee
is on military leave, sick leave or another approved leave of absence if the
period of leave does not exceed 90 days, or a longer period to the extent
that the Employee’s right to reemployment with the Company or a Subsidiary is
guaranteed by statute or by contract. If the period of leave exceeds
90 days and the Employee’s right to reemployment is not guaranteed by
statute or contract, the employment relationship will be deemed to have ceased
on the 91st day of the leave.

 

(v)           Transfer
Restrictions.  In no event
will the Committee permit an Incentive Stock Option to be transferred by an
Employee other than by will or the laws of descent and distribution, and any
Incentive Stock Option awarded under this Plan will be exercisable only by the
Employee during the Employee’s lifetime.

 

(f)  Exercise of Stock
Appreciation Rights.  Upon
exercise of a Participant’s Stock Appreciation Rights, the Company will pay
cash or Shares or a combination of cash and Shares, in the discretion of the
Committee and as described in the Award Certificate. Cash payments will be
equal to the excess of the Fair Market Value of a Share on the date of exercise
over the Exercise Price, for each Share for which a Stock Appreciation Right
was exercised. If Shares are paid for the Stock Appreciation Right, the
Participant will receive a number of whole Shares equal to the quotient of the
cash payment amount divided by the Fair Market Value of a Share on the date of
exercise.

 

(g)  No Repricing.  Except as otherwise provided in Section 5.3,
in no event will the Committee (i) decrease the Exercise Price of a Stock
Option or Stock Appreciation Right after the date of grant or (ii) cancel
outstanding Stock Options or Stock Appreciation Rights in exchange for a cash
payment or for a grant of replacement Stock Options or Stock Appreciation
Rights with a lower Exercise Price than that of the replaced Stock Options or
Stock 

 

 

Appreciation
Rights or other Awards, without first obtaining the approval of the holders of
a majority of the Shares who are present in person or by proxy at a meeting of
the Company’s stockholders and entitled to vote.

 

4.4  Annual
Performance Bonuses.  The
Committee may grant Annual Performance Bonuses under the Plan in the form of
cash or Shares to the Reporting Persons that the Committee may from time to
time select, in the amounts and pursuant to the terms and conditions that the
Committee may determine and set forth in the Award Certificate, subject to the
provisions below:

 

(a)  Performance Cycles.  Annual Performance Bonuses will be awarded in
connection with a 12-month Performance Cycle, which will be the fiscal year of
the Company.

 

(b)  Eligible Participants.  Within 90 days after the commencement of
a Performance Cycle, the Committee will determine the Reporting Persons who
will be eligible to receive an Annual Performance Bonus under the Plan.

 

(c)  Performance Measures;
Targets; Award Criteria.

 

(i)            Within
90 days after the commencement of a Performance Cycle, the Committee will
fix and establish in writing (A) the Performance Measures that will apply
to that Performance Cycle; (B) the Target Amount payable to each
Participant; and (C) subject to subsection (d) below, the
criteria for computing the amount that will be paid with respect to each level
of attained performance. The Committee will also set forth the minimum level of
performance, based on objective factors, that must be attained during the
Performance Cycle before any Annual Performance Bonus will be paid and the
percentage of the Target Amount that will become payable upon attainment of
various levels of performance that equal or exceed the minimum required level.

 

(ii)           The Committee
may, in its discretion, select Performance Measures that measure the
performance of the Company or one or more business units, divisions or
Subsidiaries of the Company. The Committee may select Performance Measures that
are absolute or relative to the performance of one or more comparable companies
or an index of comparable companies.

 

(iii)          The Committee,
in its discretion, may, on a case-by-case basis, reduce, but not increase, the
amount payable to any Key Employee with respect to any given Performance Cycle,
provided, however, that no reduction will result in an increase in the amount
payable under any Annual Performance Bonus of another Key Employee.

 

(d)  Payment, Certification.  No Annual Performance Bonus will vest with
respect to any Reporting Person until the Committee certifies in writing the
level of performance attained for the Performance Cycle in relation to the
applicable Performance Measures. In applying Performance Measures, the
Committee may, in its discretion, exclude unusual or infrequently occurring
items (including any event listed in Section 5.3 and the cumulative effect
of changes in the law, regulations or accounting rules), and may determine no
later than ninety (90) days after the commencement of any applicable
Performance Cycle to exclude other items, each determined in accordance with
GAAP (to the extent applicable) and as identified in the financial statements,
notes to the financial statements or discussion and analysis of management.

 

(e)  Form of Payment.  Annual Performance Bonuses will be paid in
cash or Shares. All such Performance Bonuses shall be paid no later than the
15th day of the third month following the end of the calendar year (or, if
later, following the end of the Company’s fiscal year) in which such
Performance Bonuses are no longer subject to a substantial risk of forfeiture
(as determined for purposes of Section 409A of the Code), except to the
extent that a Participant has elected to defer payment under the terms of a
duly authorized deferred compensation arrangement in which case the terms of
such arrangement shall govern.

 

(f)  Section 162(m) of
the Code.  It is the intent of
the Company that Annual Performance Bonuses be “performance-based compensation”
for purposes of Section 162(m) of the Code, that this Section 4.4
be interpreted in a manner that satisfies the applicable requirements of Section 162(m)(C) of
the Code and related regulations, and that the Plan be operated so that the
Company may take a full tax deduction for Annual Performance Bonuses. If any
provision of this Plan or any Annual Performance Bonus would otherwise
frustrate or conflict with this intent, the provision will be interpreted and
deemed amended so as to avoid this conflict.

 

 

4.5  Long Term
Performance Awards.  The
Committee may grant Long Term Performance Awards under the Plan in the form of
Performance Units, Restricted Units or Restricted Stock to any Employee who the
Committee may from time to time select, in the amounts and pursuant to the
terms and conditions that the Committee may determine and set forth in the
Award Certificate, subject to the provisions below:

 

(a)  Performance Cycles.  Long Term Performance Awards will be awarded
in connection with a Performance Cycle, as determined by the Committee in its
discretion, provided, however, that a Performance Cycle may be no shorter than
12 months and no longer than 5 years.

 

(b)  Eligible Participants.  Within 90 days after the commencement of
a Performance Cycle, the Committee will determine the Employees who will be
eligible to receive a Long Term Performance Award for the Performance Cycle,
provided that the Committee may determine the eligibility of any Employee other
than a Key Employee after the expiration of the 90-day period.

 

(c)  Performance Measures;
Targets; Award Criteria.

 

(i)         Within
90 days after the commencement of a Performance Cycle, the Committee will
fix and establish in writing (A) the Performance Measures that will apply
to that Performance Cycle; (B) with respect to Performance Units, the
Target Amount payable to each Participant; (C) with respect to Restricted
Units and Restricted Stock, the Target Vesting Percentage for each Participant;
and (D) subject to subsection (d) below, the criteria for
computing the amount that will be paid or will vest with respect to each level
of attained performance. The Committee will also set forth the minimum level of
performance, based on objective factors, that must be attained during the
Performance Cycle before any Long Term Performance Award will be paid or vest,
and the percentage of Performance Units that will become payable and the
percentage of performance-based Restricted Units or Shares of Restricted Stock
that will vest upon attainment of various levels of performance that equal or
exceed the minimum required level.

 

(ii)        The Committee
may, in its discretion, select Performance Measures that measure the
performance of the Company or one or more business units, divisions or
Subsidiaries of the Company. The Committee may select Performance Measures that
are absolute or relative to the performance of one or more comparable companies
or an index of comparable companies.

 

(iii)       The Committee,
in its discretion, may, on a case-by-case basis, reduce, but not increase, the
amount of Long Term Performance Awards payable to any Key Employee with respect
to any given Performance Cycle, provided, however, that no reduction will
result in an increase in the dollar amount or number of Shares payable under
any Long Term Performance Award of another Key Employee.

 

(iv)       With respect to Employees
who are not Key Employees, the Committee may establish, in its discretion, performance
criteria other than the Performance Measures that will be applicable for the
Performance Cycle.

 

(d) Payment,
Certification.  No Long Term
Performance Award will vest with respect to any Employee until the Committee
certifies in writing the level of performance attained for the Performance
Cycle in relation to the applicable Performance Measures. Long Term Performance
Awards awarded to Participants who are not Key Employees will be based on the
Performance Measures, or other applicable performance criteria, and payment
formulas that the Committee, in its discretion, may establish for these
purposes. These Performance Measures, or other performance criteria, and
formulas may be the same as or different than the Performance Measures and
formulas that apply to Key Employees.

 

In applying Performance Measures, the Committee may, in its discretion,
exclude unusual or infrequently occurring items (including any event listed in Section 5.3)
and the cumulative effect of changes in the law, regulations or accounting
rules, and may determine no later than ninety (90) days after the
commencement of any applicable Performance Cycle to exclude other items, each
determined in accordance with GAAP (to the extent applicable) and as identified
in the financial statements, notes to the financial statements or discussion
and analysis of management.

 

(e)  Form of
Payment.  Long Term
Performance Awards in the form of Performance Units may be paid in cash or full
Shares, in the discretion of the Committee, and as set forth in the Award
Certificate. Performance-based Restricted Units and Restricted Stock will be
paid in full Shares. Payment with respect to any fractional Share will 

 

 

be
in cash in an amount based on the Fair Market Value of the Share as of the date
the Performance Unit becomes payable. All such Long Term Performance Awards
shall be paid no later than the 15th day of the third month following the
end of the calendar year (or, if later, following the end of the Company’s
fiscal year) in which such Long Term Performance Awards are no longer subject
to a substantial risk of forfeiture (as determined for purposes of Code Section 409A),
except to the extent that a Participant has elected to defer payment under the
terms of a duly authorized deferred compensation arrangement, in which case the
terms of such arrangement shall govern.

 

(f)  Section 162(m) of
the Code.  It is the
intent of the Company that Long Term Performance Awards made to Key Employees
be “performance-based compensation” for purposes of Section 162(m) of
the Code, that this Section 4.5 be interpreted in a manner that satisfies
the applicable requirements of Section 162(m)(C) of the Code and
related regulations with respect to Long Term Performance awards made to Key
Employees, and that the Plan be operated so that the Company may take a full
tax deduction for Long Term Performance Awards. If any provision of this Plan
or any Long Term Performance Award would otherwise frustrate or conflict with
this intent, the provision will be interpreted and deemed amended so as to
avoid this conflict.

 

(g) Retirement.  If a Participant would be entitled to a Long
Term Performance Award but for the fact that the Participant’s employment with
the Company terminated prior to the end of the Performance Cycle as a result of
the Participant’s Retirement, the Participant may, in the Committee’s
discretion, receive a Long Term Performance Award, pro rated for the portion of
the Performance Cycle that the Participant completed and payable at the same
time after the end of the Performance Cycle that payments to other Long Term
Performance Award recipients are made.

 

4.6  Other
Stock-Based Awards.  The
Committee may, from time to time, grant Awards (other than Stock Options, Stock
Appreciation Rights, Annual Performance Bonuses or Long Term Performance
Awards) to any Employee who the Committee may from time to time select, which
Awards consist of, or are denominated in, payable in, valued in whole or in
part by reference to, or otherwise related to, Shares. These Awards may include,
among other forms, Restricted Stock, Restricted Units, or Deferred Stock Units.
The Committee will determine, in its discretion, the terms and conditions that
will apply to Awards granted pursuant to this Section 4.6, which terms and
conditions will be set forth in the applicable Award Certificate.

 

(a)  Vesting.  Unless the Award Certificate provides
otherwise, restrictions on Stock-Based Awards granted under this Section 4.6
will lapse in equal annual installments over a period of four years beginning
immediately after the date of grant. If the restrictions on Stock-Based Awards
have not lapsed or been satisfied as of the Participant’s Termination of
Employment, the Shares will be forfeited by the Participant if the termination
is for any reason other than the Retirement, death or Disability of the
Participant or a Change in Control. Unless the Award Certificate provides
otherwise, (i) all restrictions on Stock-Based Awards granted pursuant to
this Section 4.6 will lapse upon the death or Disability of the
Participant, (ii) in the event of Retirement, the Award will vest pro rata
with respect to the portion of the four-year vesting term (or such other
vesting term as is set forth in the Award Certificate) that the Participant has
completed as of the Participant’s Termination of Employment and provided that
the Participant has satisfied all other applicable conditions established by
the Committee with respect to such pro rata vesting, and (iii) in the
event of a Change in Control, Stock-Based Awards will be treated in accordance
with Section 5.4. In no event may the vesting period of a time-based
full-value share award be less than three years (on either a cliff or graded
vesting basis), except that the Committee may award up to 10 percent of
the shares authorized for issuance under Section 5.1 with a vesting period
of less than three years under such circumstances as it deems appropriate.

 

(b) Grant
of Restricted Stock.  The
Committee may grant Restricted Stock to any Employee, which Shares will be
registered in the name of the Participant and held for the Participant by the
Company. The Participant will have all rights of a stockholder with respect to
the Shares, including the right to vote and to receive dividends or other
distributions, except that the Shares may be subject to a vesting schedule and
will be forfeited if the Participant attempts to sell, transfer, assign, pledge
or otherwise encumber or dispose of the Shares before the restrictions are
satisfied or lapse.

 

(c)  Grant
of Restricted Units.  The
Committee may grant Restricted Units to any Employee, which Units will be paid
in cash or whole Shares or a combination of cash and Shares, as determined in
the discretion of the Committee. The Committee will determine the terms and
conditions applicable to the grant of Restricted Units, which terms and
conditions will be set forth in the Award Certificate. For each Restricted Unit
that vests, one Share will be paid or an amount in cash equal to the Fair
Market Value of a Share, as set forth in the Award Certificate, will be
delivered to the Participant on the applicable delivery date.

 

 

(d) Grant
of Deferred Stock Units.  The
Committee may grant Deferred Stock Units to any Employee, which Units will be
paid in whole Shares upon the Employee’s Termination of Employment if the
restrictions on the Units have lapsed. One Share will be paid for each Deferred
Stock Unit that becomes payable.

 

(e)  Dividends
and Dividend Equivalents.  At
the discretion of the Committee and as set forth in the applicable Award Certificate,
dividends issued on Shares may be paid immediately or withheld and deferred in
the Participant’s account. In the event of a payment of dividends on Common
Stock, the Committee may credit Restricted Units with Dividend Equivalents in
accordance with terms and conditions established in the discretion of the
Committee. Dividend Equivalents will be subject to such vesting terms as is
determined by the Committee and may be distributed immediately or withheld and
deferred in the Participant’s account as determined by the Committee and set
forth in the applicable Award Certificate. Deferred Stock Units may, in the
discretion of the Committee and as set forth in the Award Certificate, be
credited with Dividend Equivalents or additional Deferred Stock Units. The
number of any Deferred Stock Units credited to a Participant’s account upon the
payment of a dividend will be equal to the quotient produced by dividing the
cash value of the dividend by the Fair Market Value of one Share as of the date
the dividend is paid. The Committee will determine any terms and conditions on
deferral of a dividend or Dividend Equivalent, including the rate of interest
to be credited on deferral and whether interest will be compounded.

 

4.7  Director
Awards.

 

(a)  The Committee may grant
Deferred Stock Units to each Director in such an amount as the Board, in its
discretion, may approve in advance. Each such Deferred Stock Unit will vest as
determined by the Committee and set forth in the Award Certificate and will be
paid in Shares within 30 days following the recipient’s Termination of
Directorship, subject to deferral under any applicable deferred compensation
plan approved by the Committee, in which case the terms of such arrangement
shall govern. Dividend Equivalents or additional Deferred Stock Units will be
credited to each Director’s account when dividends are paid on Common Stock to
the shareholders, and will be paid to the Director at the same time that the
Deferred Stock Units are paid to the Director.

 

(b) The Committee may grant
Director Shares to each Director in such amounts as the Board, in its
discretion, may approve in advance.

 

(c)  The Committee may, in its
discretion, grant Stock Options, Stock Appreciation Rights and other
Stock-Based Awards to Directors.

 

4.8  Substitute
Awards.  The Committee may
make Awards under the Plan to Acquired Grantees through the assumption of, or
in substitution for, outstanding Stock-Based Awards previously granted to such
Acquired Grantees. Such assumed or substituted Awards will be subject to the
terms and conditions of the original awards made by the Acquired Company, with
such adjustments therein as the Committee considers appropriate to give effect
to the relevant provisions of any agreement for the acquisition of the Acquired
Company, provided that any such adjustment with respect to Nonqualified Stock
Options and Stock Appreciation Rights shall satisfy the requirements of Treas.
Reg. § 1.409A-1(b)(5)(v)(D) and otherwise ensure that such awards
continue to be exempt from Code Section 409A and provided that any
adjustment to Awards that are subject to Code Section 409A is in
compliance with Code Section 409A and the regulations and rulings
thereunder. Any grant of Incentive Stock Options pursuant to this Section 4.8
will be made in accordance with Section 424 of the Code and any final
regulations published thereunder.

 

4.9  Limit on
Individual Grants.  Subject to
Sections 5.1 and 5.3, no Employee may be granted more than 6 million
Shares over any calendar year pursuant to Awards of Stock Options, Stock
Appreciation Rights and performance-based Restricted Stock and Restricted
Units, except that an incentive Award of no more than 10 million Shares
may be made pursuant to Stock Options, Stock Appreciation Rights and
performance-based Restricted Stock and Restricted Units to any person who has
been hired within the calendar year as a Key Employee. The maximum amount that
may be paid in cash or Shares pursuant to Annual Performance Bonuses or Long
Term Performance Awards paid in Performance Units to any one Employee is
$10 million (U.S.) for any Performance Cycle of 12 months. For any
longer Performance Cycle, this maximum will be adjusted proportionally.

 

4.10  Termination
for Cause.  Notwithstanding
anything to the contrary herein, if a Participant incurs a Termination of
Directorship or Termination of Employment for Cause, then all Stock Options,
Stock Appreciation Rights, Annual Performance Bonuses, Long Term Performance
Awards, Restricted Units, Restricted Stock and other Stock-Based Awards will
immediately be cancelled. The exercise of any Stock Option or Stock
Appreciation Right or the payment of any Award may be delayed, in the Committee’s
discretion, in the event that a potential termination for Cause is pending,
subject to ensuring an exemption from or compliance with Code Section 409A
and the underlying regulations and rulings. If a 

 

 

Participant incurs a
Termination of Employment for Cause, or the Company becomes aware (after the
Participant’s Termination of Employment) of conduct on the part of the
Participant that would be grounds for a Termination of Employment for Cause,
then the Participant will be required to deliver to the Company (i) Shares
(or, in the discretion of the Committee, cash) in an amount that is equal in
value to the amount of any profit the Participant realized upon the exercise of
an Option during the period beginning six (6) months prior to the
Participant’s Termination of Employment for Cause and ending on the two (2) year
anniversary of such Termination of Employment; and (ii) the number of
Shares (or, in the discretion of the Committee, the cash value of said shares)
the Participant received for Restricted Shares or Restricted Units that vested
during the period described in (i) above.

 

ARTICLE V

SHARES SUBJECT TO THE PLAN; ADJUSTMENTS

 

5.1  Shares
Available.  The Shares
issuable under the Plan will be authorized but unissued Shares, and, to the
extent permissible under applicable law, Shares acquired by the Company, any
Subsidiary or any other person or entity designated by the Company. The total
number of Shares with respect to which Awards may be issued under the Plan may
equal, but may not exceed, five percent (5%) of the Shares outstanding as of June 29,
2007, subject to adjustment in accordance with Section 5.3; provided that
when Shares are issued pursuant to a grant of Restricted Stock, Restricted
Units, Deferred Stock Units, Performance Units or as payment of an Annual
Performance Bonus or other Stock-Based Award, the total number of Shares
remaining available for grant will be decreased by a margin of at least 1.8 per
Share issued. In addition, in the case of the settlement of any stock-settled
Stock Appreciation Right, the total number of Shares available for grant will
be decreased by the total number of Shares equal in value to the total value of
the Stock Appreciation Right on the day of settlement. No more than
10 million Shares of the total Shares issuable under the Plan may be
available for grant in the form of Incentive Stock Options.

 

5.2  Counting
Rules.  The following Shares
related to Awards under this Plan may again be available for issuance under the
Plan, in addition to the Shares described in Section 5.1:

 

(a)  Shares related to Awards
paid in cash;

 

(b) Shares related to Awards
that expire, are forfeited or cancelled or terminate for any other reason
without issuance of Shares, and provided that each such forfeited, cancelled or
terminated Share that was originally issued pursuant to a grant of Restricted
Stock, Restricted Units, Deferred Stock Units, Performance Units or as payment
of an Annual Performance Bonus or other Stock-Based Award shall be counted as
1.8 Share;

 

(c)  Any Shares issued in
connection with Awards that are assumed, converted or substituted as a result
of the acquisition of an Acquired Company by the Company or a combination of
the Company with another company; and

 

(d) Any Shares of Restricted
Stock that are returned to the Company upon a Participant’s Termination of
Employment.

 

5.3  Adjustments.  In the event of a change in the outstanding
Shares by reason of a stock split, reverse stock split, dividend or other
distribution (whether in the form of cash, Shares, other securities or other
property), extraordinary cash dividend, recapitalization, merger,
consolidation, split-up, spin-off, reorganization, combination, repurchase or
exchange of Shares or other securities or similar corporate transaction or
event, the Committee shall make an appropriate adjustment to prevent dilution
or enlargement of the benefits or potential benefits intended to be made
available under the Plan . Any such adjustment with respect to Nonqualified
Stock Options and Stock Appreciation Rights shall satisfy the requirements of
Treas. Reg. § 1.409A-1(b)(5)(v)(D) and otherwise ensure that such
awards continue to be exempt from Code Section 409A, and any adjustment to
Awards that are subject to Code Section 409A shall comply with Code Section 409A
and the regulations and rulings thereunder. Any adjustment made by the
Committee under this Section 5.3 will be conclusive and binding for all
purposes under the Plan.

 

5.4  Change in
Control.

 

(a)  Unless otherwise provided
under the terms of an applicable Award Certificate, (i) all outstanding
Stock Options and Stock Appreciation Rights will become exercisable as of the
effective date of a Participant’s Change in Control Termination if the Awards
are not otherwise vested, and all conditions will be waived with respect to
outstanding Restricted Stock, Restricted Units and other Stock-Based Awards
(other than Long Term Performance Awards) and Deferred Stock Units, and (ii) each
Participant who has been granted an Annual Performance Bonus or 

 

 

Long
Term Performance Award that is outstanding as of the date of such Participant’s
Change in Control Termination will be deemed to have achieved a level of
performance, as of the Change in Control Termination, that would cause all
(100%) of the Participant’s Target Amounts to become payable and all
restrictions on the Participant’s Restricted Units and Shares of Restricted
Stock to lapse. Unless the Committee determines otherwise in its discretion
(either when the award is granted or any time thereafter), in the event that
Awards outstanding as of the date of a Change in Control that are payable in
shares of Company Common Stock will not be substituted with comparable awards
payable or redeemable in shares of publicly-traded stock after the Change in
Control, each such outstanding Award (i) will become fully vested (at
target, where applicable) immediately prior to the Change in Control and (ii) each
such Award that is a Stock Option will be settled in cash, without the
Participant’s consent, for an amount equal to the amount that could have been
attained upon the exercise of such Award immediately prior to the Change in Control
had such Award been exercisable or payable at such time.

 

(b) In addition to the such
other actions described in Section 5.4(a), in the event of a Change in
Control the Committee may take any one or more of the following actions with
respect to any or all outstanding Awards, without the consent of the
Participant: (i) the Committee may determine that outstanding Stock
Options and Stock Appreciation Rights shall be fully exercisable, and
restrictions on Restricted Stock, Restricted Units, Deferred Stock Units and
other Stock-Based Awards shall lapse, as of the date of the Change in Control
or such other time (prior to a Participant’s Change in Control Termination) as
the Committee determines, (ii) the Committee may require that a
Participant surrender their outstanding Stock Options and Stock Appreciation
Rights in exchange for one or more payments by the Company, in cash or Common
Stock as determined by the Committee, in an amount equal to the amount by which
the then Fair Market Value of the shares of Common Stock subject to the
Participant’s unexercised Stock Options and Stock Appreciation Rights exceeds
the exercise price, if any, and on such terms as the Committee determines, (iii) after
giving Participants an opportunity to exercise their outstanding Stock Options
and Stock Appreciation Rights, the Committee may terminate any or all
unexercised Stock Options and Stock Appreciation Rights at such time as the
Committee deems appropriate, (iv) the Committee may determine that Annual
Performance Bonuses and/or Long Term Performance Awards will be paid out at
their target level, in cash or Common Stock as determined by the Committee, or (v) the
Committee may determine that Awards that remain outstanding after the Change in
Control shall be converted to similar grants of, or assumed by, the surviving
corporation (or a parent or subsidiary of the surviving corporation or
successor). Such acceleration, surrender, termination, settlement or conversion
shall take place as of the date of the Change in Control or such other date as
the Committee may specify. The Committee may specify how an Award will be
treated in the event of a Change in Control either when the Award is granted or
at any time thereafter, except as otherwise provided herein.

 

5.5  Fractional
Shares.  No fractional Shares
will be issued under the Plan. Except as otherwise provided in Section 4.5(e),
if a Participant acquires the right to receive a fractional Share under the
Plan, the Participant will receive, in lieu of the fractional Share, a full
Share as of the date of settlement, unless otherwise provided by the Committee.

 

ARTICLE VI

AMENDMENT AND TERMINATION

 

6.1  Amendment.  The Plan may be amended at any time and from
time to time by the Board without the approval of stockholders of the Company,
except that no material revision to the terms of the Plan will be effective
until the amendment is approved by the stockholders of the Company. A revision
is “material” for this purpose if, among other changes, it materially increases
the number of Shares that may be issued under the Plan (other than an increase
pursuant to Section 5.3 of the Plan), expands the types of Awards
available under the Plan, materially expands the class of persons eligible to
receive Awards under the Plan, materially extends the term of the Plan,
materially decreases the Exercise Price at which Stock Options or Stock
Appreciation Rights may be granted, reduces the Exercise Price of outstanding
Stock Options or Stock Appreciation Rights, or results in the replacement of
outstanding Stock Options and Stock Appreciation Rights with new Awards that
have an Exercise Price that is lower than the Exercise Price of the replaced
Stock Options and Stock Appreciation Rights. No amendment of the Plan or any
outstanding Award made without the Participant’s written consent may adversely
affect any right of a Participant with respect to an outstanding Award.

 

6.2  Termination.  The Plan will terminate upon the earlier of
the following dates or events to occur:

 

(a)  the adoption of a resolution
of the Board terminating the Plan; or

 

(b) the day before the
10th anniversary of the adoption of the Plan by the Company’s shareholder
as described in Section 1.2.

 

 

No Awards will be granted
under this Plan after it has terminated. The termination of the Plan, however,
will not alter or impair any of the rights or obligations of any person under
any Award previously granted under the Plan without such person’s consent.
After the termination of the Plan, any previously granted Awards will remain in
effect and will continue to be governed by the terms of the Plan and the
applicable Award Certificate.

 

ARTICLE VII

GENERAL PROVISIONS

 

7.1 
Nontransferability of Awards. 
No Award under the Plan will be subject in any manner to alienation,
anticipation, sale, assignment, pledge, encumbrance or transfer, and no other
persons will otherwise acquire any rights therein, except as provided below.

 

(a)  Any Award may be transferred
by will or by the laws of descent or distribution.

 

(b) The Committee may provide in
the applicable Award Certificate that all or any part of a Nonqualified Option
or Shares of Restricted Stock may, subject to the prior written consent of the
Committee, be transferred to a family member. For purposes of this
subsection (b), “family member” includes any child, stepchild, grandchild,
parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew,
mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or
sister-in-law of the Participant, including adoptive relationships, any person
sharing the Participant’s household (other than a tenant or employee), a trust
in which these persons have more than 50 percent of the beneficial
interest, a foundation in which these persons (or the Participant) control the
management of assets, and any other entity in which these persons (or the
Participant) own more than 50 percent of the voting interests.

 

Any
transferred Award will be subject to all of the same terms and conditions as
provided in the Plan and the applicable Award Certificate. The Participant or
the Participant’s estate will remain liable for any withholding tax that may be
imposed by any federal, state or local tax authority. The Committee may, in its
discretion, disallow all or a part of any transfer of an Award pursuant to this
subsection (b) unless and until the Participant makes arrangements
satisfactory to the Committee for the payment of any withholding tax. The
Participant must immediately notify the Committee, in the form and manner
required by the Committee, of any proposed transfer of an Award pursuant to
this subsection (b). No transfer will be effective until the Committee
consents to the transfer in writing.

 

(c)   Except as otherwise provided
in the applicable Award Certificate, any Nonqualified Stock Option transferred
by a Participant pursuant to this subsection (c) may be exercised by
the transferee only to the extent that the Award would have been exercisable by
the Participant had no transfer occurred. The transfer of Shares upon exercise
of the Award will be conditioned on the payment of any withholding tax.

 

(d)   Restricted Stock may be
freely transferred after the restrictions lapse or are satisfied and the Shares
are delivered, provided, however, that Restricted Stock awarded to an affiliate
of the Company may be transferred only pursuant to Rule 144 under the
Securities Act, or pursuant to an effective registration for resale under the
Securities Act. For purposes of this subsection (d), “affiliate” will have
the meaning assigned to that term under Rule 144.

 

(e)   In no event may a
Participant transfer an Incentive Stock Option other than by will or the laws
of descent and distribution.

 

7.2  Withholding
of Taxes.  The Committee, in
its discretion, may satisfy a Participant’s tax withholding obligations by any
of the following methods or any method as it determines to be in accordance
with the laws of the jurisdiction in which the Participant resides, has
domicile or performs services.

 

(a)  Stock
Options and Stock Appreciation Rights.  As a condition to the delivery of Shares
pursuant to the exercise of a Stock Option or Stock Appreciation Right, the
Committee may require that the Participant, at the time of exercise, pay to the
Company by cash, certified check, bank draft, wire transfer or postal or
express money order an amount sufficient to satisfy any applicable tax
withholding obligations. The Committee may also, in its discretion, accept
payment of tax withholding obligations through any of the Exercise Price
payment methods described in Section 4.3(d).

 

(b) Other
Awards Payable in Shares.  The
Participant shall satisfy the Participant’s tax withholding obligations arising
in connection with the release of restrictions on Restricted Units, Restricted
Stock and other Stock-Based Awards by payment to the Company in cash or by
certified check, bank draft, wire transfer or postal or 

 

 

express
money order, provided that the format is approved by the Company or a
designated third-party administrator. However, subject to any requirements of
applicable law, the Company may also satisfy the Participant’s tax withholding
obligations by other methods, including selling or withholding Shares that
would otherwise be available for delivery, provided that the Board or the
Committee has specifically approved such payment method in advance.

 

(c)  Cash
Awards.  The Company may satisfy a
Participant’s tax withholding obligation arising in connection with the payment
of any Award in cash by withholding cash from such payment.

 

7.3  Special
Forfeiture Provision.  The
Committee may, in its discretion, provide in an Award Certificate that the
Participant may not, within two years of the Participant’s Termination of
Employment with the Company, enter into any employment or consultation
arrangement (including service as an agent, partner, stockholder, consultant,
officer or director) with any entity or person engaged in any business in which
the Company or any Subsidiary is engaged without prior written approval of the
Committee if, in the sole judgment of the Committee, the business is
competitive with the Company or any Subsidiary or business unit or such
employment or consultation arrangement would present a risk that the
Participant would likely disclose Company proprietary information (as
determined by the Committee). If the Committee makes a determination that this
prohibition has been violated, the Participant (i) will forfeit all rights
under any outstanding Stock Option or Stock Appreciation Right that was granted
subject to the Award Certificate and will return to the Company the amount of
any profit realized upon an exercise of all Awards during the period, as the
Committee determines and sets forth in the Award Certificate, beginning no
earlier than six months prior to the Participant’s Termination of Employment, and
(ii) will forfeit and return to the Company any Annual Performance
Bonuses, Performance Units, Shares of Restricted Stock, Restricted Units
(including any credited Dividend Equivalents), Deferred Stock Units, and other
Stock-Based Awards that are outstanding on the date of the Participant’s
Termination of Employment, subject to the Award Certificate, and have not
vested or that had vested and remain subject to this Section 7.3 during a
period, as the Committee determines and sets forth in the Award Certificate,
beginning no earlier than six months prior to the Participant’s Termination of
Employment.

 

7.4  No Implied
Rights.  The establishment and
operation of the Plan, including the eligibility of a Participant to
participate in the Plan, will not be construed as conferring any legal or other
right upon any Director for any continuation of directorship or any Employee
for the continuation of employment through the end of any Performance Cycle or
other period. The Company expressly reserves the right, which may be exercised
at any time and in the Company’s sole discretion, to discharge any individual
or treat him or her without regard to the effect such discharge might have upon
him or her as a Participant in the Plan.

 

7.5  No Obligation
to Exercise Awards.  The grant
of a Stock Option or Stock Appreciation Right will impose no obligation upon
the Participant to exercise the Award.

 

7.6  No Rights as
Stockholders.  A Participant
who is granted an Award under the Plan will have no rights as a stockholder of
the Company with respect to the Award unless and until certificates for the
Shares underlying the Award are registered in the Participant’s name and (other
than in the case of Restricted Stock) delivered to the Participant. The right
of any Participant to receive an Award by virtue of participation in the Plan
will be no greater than the right of any unsecured general creditor of the
Company.

 

7.7 
Indemnification of Committee. 
The Company will indemnify, to the fullest extent permitted by law, each
person made or threatened to be made a party to any civil or criminal action or
proceeding by reason of the fact that the person, or the executor or
administrator of the person’s estate, is or was a member of the Committee or a
delegate of the Committee.

 

7.8  No Required
Segregation of Assets. 
Neither the Company nor any Subsidiary will be required to segregate any
assets that may at any time be represented by Awards granted pursuant to the
Plan.

 

7.9  Nature of
Payments.  All Awards made
pursuant to the Plan are in consideration of services for the Company or a
Subsidiary. Any gain realized pursuant to Awards under the Plan constitutes a
special incentive payment to the Participant and will not be taken into account
as compensation for purposes of any other employee benefit plan of the Company
or a Subsidiary, except as the Committee otherwise provides. The adoption of
the Plan will have no effect on Awards made or to be made under any other
benefit plan covering an employee of the Company or a Subsidiary or any
predecessor or successor of the Company or a Subsidiary.

 

7.10  Securities
Law Compliance.  Awards under
the Plan are intended to satisfy the requirements of Rule 16b-3 under the
Exchange Act. If any provision of this Plan or any grant of an Award would otherwise
frustrate or conflict with this intent, that provision will be interpreted and
deemed amended so as to avoid conflict. No Participant will be entitled to a 

 

 

grant, exercise, transfer or
payment of any Award if the grant, exercise, transfer or payment would violate
the provisions of the Sarbanes-Oxley Act of 2002 or any other applicable law.

 

7.11  Section 409A
Compliance.  To the extent the
Committee determines that any Award granted under the Plan is subject to Section 409A
of the Code, the Award Certificate evidencing such Award will incorporate the
terms and conditions required by Section 409A of the Code. To the extent
applicable, the Plan and the Award Certificate will be interpreted in
accordance with Section 409A of the Code and Department of Treasury
regulations and other interpretive guidance issued thereunder, including
without limitation any such regulations or other guidance that may be issued
after the Effective Date. Notwithstanding any provision of the Plan, in the
event that the Committee determines that any Award may be subject to Section 409A
of the Code, the Committee may adopt such amendments to the Plan and/or the
applicable Award Certificate or adopt policies and procedures or take any other
action or actions, including an action or amendment with retroactive effect,
that the Committee determines is necessary or appropriate to (i) exempt
the Award from the application of Section 409A of the Code or (ii) comply
with the requirements of Section 409A of the Code. Any Award that provides
for a payment to any Participant who is a “specified employee” of deferred
compensation that is subject to Code Section 409A(a)(2) and that
becomes payable upon, or that is accelerated upon, such Participant’s
Termination of Employment, shall also provide that no such payment shall be
made on or before the date which is six months following such Participant’s
Termination of Employment (or, if earlier, such Participant’s death). A
specified employee for this purpose shall be determined by the Committee or its
delegate in accordance with the provisions of Code Section 409A and the
regulations and rulings thereunder.

 

7.12  Governing
Law, Severability.  The Plan
and all determinations made and actions taken under the Plan will be governed
by the law of Switzerland and construed accordingly. If any provision of the
Plan is held unlawful or otherwise invalid or unenforceable in whole or in
part, the unlawfulness, invalidity or unenforceability will not affect any
other parts of the Plan, which parts will remain in full force and effect.Exhibit 10.5

 

TYCO ELECTRONICS
LTD.

EMPLOYEE
STOCK PURCHASE PLAN

AS AMENDED
AND RESTATED MARCH 10, 2009

 

ARTICLE 1 — PURPOSE

The Tyco Electronics Employee
Stock Purchase Plan (the “Plan”) is created for the purpose of encouraging
stock ownership by officers and employees of Tyco Electronics Ltd. and its
subsidiaries (the “Company”) so that they may share in the growth of the
Company by acquiring or increasing their proprietary interest in the Company.

 

ARTICLE 2 — ADMINISTRATION OF THE
PLAN

The Plan will be
administered by the Management Development and Compensation Committee (the “Committee”)
of the Board of Directors of the Company or its designee. The interpretation
and construction by the Committee or its designee of any provision of the Plan
shall be final unless otherwise determined by the Board of Directors.  The Committee or its designee may adopt, from
time to time, such rules and regulations, as it deems appropriate for
carrying out the Plan.  No member of the
Committee or the Committee’s designee shall be liable for any action or
determination made in good faith with respect to the Plan.

 

ARTICLE 3 — ELIGIBLE EMPLOYEES

The Senior Vice
President, Human Resources of Tyco Electronics will, from time to time,
determine which of the Company’s employees (including employees of the Company’s
subsidiaries and divisions) will be eligible to participate in the Plan.  All officers who are employees of the Company
will be eligible to participate in the Plan, unless otherwise determined by the
Senior Vice President, Human Resources of Tyco Electronics.  Eligible employees who elect to participate
in the Plan shall hereinafter be referred to as “Participants”.  Notwithstanding the foregoing, any employee
who sells Shares purchased under the Plan within three months of the date of
purchase shall be precluded from participating in the Plan for the next 12
months.

 

ARTICLE 4 — SHARES TO BE
PURCHASED

The stock subject to
purchase under the Plan is 6,000,000 shares (subject to adjustment in the event
of stock splits, stock dividends, recapitalization, or similar adjustment in
the Company’s common stock) of the common stock of the Company (the “Shares”).  At the discretion of the Company, Shares
purchased on behalf of Plan Participants (a) will be purchased on the open
market or (b) will be issued to the Plan by the Company and allocated to
Plan Participants from newly-issued shares or from shares (“Treasury Shares”)
acquired by the Company, any Subsidiary or any other person or entity
designated by the Company, including the Company’s treasury shares.

 

ARTICLE 5 — PAYROLL DEDUCTIONS

Participants, upon
entering the Plan, shall authorize payroll deductions to be made for the
purchase of Shares.  The maximum
deduction shall not, on a per pay period basis, exceed a Participant’s base
salary or commission (in the case of an employee who receives commission and no
base salary) and deductions shall be exclusive of overtime and net withholding
and other deductions.  The Participant
may authorize increases or decreases in the amount of payroll deductions.  In order to effect such a change in the
amount of the payroll deductions, the Company must receive notice of such
change in the manner specified by the Company and changes will take effect as
soon as administratively possible.  The Company
will accumulate and hold for the Participant’s account the amounts deducted
from his/her pay.  No interest shall be
paid on such amounts.  Notwithstanding
the foregoing, the Committee may, in its sole discretion, authorize a special
bonus payment be made to a Participant and such bonus be designated as an
employee contribution.  Such employee
contribution will be entitled to receive the matching Employer Contribution
described in the next Article.  The bonus
may exceed the contribution 

 

 

limits otherwise imposed
on the Participants.  In the event that
payroll deductions are either prohibited under local law or otherwise deemed to
be administratively burdensome, the Company may accept employee contributions
to the Plan in such other form as is deemed appropriate.

 

Notwithstanding any other
provision in the Plan to the contrary, the maximum annual employee contribution
for employees who are subject to the reporting and short-swing profit
provisions of Section 16 of the Securities Exchange Act of 1934 shall be
$25,000.

 

ARTICLE 6 — EMPLOYER CONTRIBUTION

The Company will match each
employee’s contribution by contributing to the Plan an additional fifteen
percent (15%) of the employee’s payroll deduction.  The Company matching contribution will be
paid on employee contributions made to the Plan up to a maximum annual
contribution of $40,000 (US). For purposes of determining the Company’s maximum
annual contribution in countries outside the United States, the U.S. dollar
equivalent of the $40,000 employee contribution (or other designated annual
employee contribution) for any calendar year will be based on the exchange rate
in effect on the first business day of December of the prior calendar
year.  The Committee, from time to time,
may increase or decrease the percentage of the Company’s contribution to the
Participant’s payroll deduction if the interests of the Company so require.  The matching contributions hereunder are not
intended to be entitled or part of the regular compensation of any
Participant.  The Company will pay all
commissions relating to the purchase of the Shares under the Plan, and the
Company will pay all administrative costs associated with the implementation
and operation of the Plan.

 

ARTICLE 7 — AUTHORIZATION FOR
ENTERING THE PLAN

An eligible employee may
enter the Plan by enrolling in the Plan and specifying his/her contribution
amount in the manner authorized by the Company. 
Such authorization will take effect as of the next practicable payroll
period.  Unless a Participant authorizes
changes to his/her payroll deductions in accordance with Article 5 or
withdraws from the Plan, his/her deductions under the latest authorization on
file with the Company shall continue from one payment period to the succeeding
payment period as long as the Plan remains in effect.

 

ARTICLE 8 — PURCHASE OF SHARES

All Shares purchased
under the Plan which are purchased on the open market shall be purchased by a
broker designated, from time to time, by the Committee.  On a monthly basis, as soon as practicable
following the month end, the Company shall remit the total of contributions to
the broker for the purchase of the Shares. 
The broker will then execute the purchase order and the Plan
Administrator shall allocate Shares (or fraction thereof) to each participant’s
individual recordkeeping account.  In the
event the purchase of Shares takes place over a number of days and at different
prices, then each participant’s allocation shall be adjusted on the basis of
the average price per Share over such period.

 

All Shares issued to the
Plan from newly-issued or Treasury Shares will be allocated to Participants’
accounts as of the eighth trading day of the month and will be allocated based
on the volume weighted average price of the Company’s stock on the New York
Stock Exchange on such date.

 

ARTICLE 9 — ISSUANCE OF SHARES

The Shares purchased
under the Plan shall be held by the Plan Administrator or its nominee.  Participants shall receive periodic
statements that will evidence all activity in the accounts that have been
established on their behalf.  Such
statements will be issued by the Plan Administrator or its nominee.  In the event a Participant wishes to hold
certificates in his/her own name, the Participant must instruct the Plan
Administrator or its nominee independently and bear the costs associated with
the issuance of such certificates and pay, if required, a fee for each
certificate so issued.  Fractional Shares
shall be liquidated on a cash basis only in lieu of the issuance of
certificates for such fractional Shares upon the employee’s withdrawal.

 

 

ARTICLE 10 — AUTOMATIC DIVIDEND
REINVESTMENT

Any dividends paid to
Participants for Shares purchased under the Plan and held by the Plan
Administrator shall be automatically reinvested in the Shares of the Company.

 

ARTICLE 11 — SALE OF SHARES
PURCHASED UNDER THE PLAN

Each Participant may sell
at any time all or any portion of the Shares acquired under the Plan and held
by the Plan Administrator by notifying the Plan Administrator, or its designee,
who will direct the broker to execute the sale on behalf of the
Participant.  The Participant shall pay
the broker’s commission and any other expenses incurred with regard to the sale
of the Shares.  All such sales of the
Shares will be subject to compliance with any applicable federal or state
securities, tax or other laws.  Each
participant assumes the risk of any fluctuations in the market price of the
Shares.

 

ARTICLE 12 — WITHDRAWAL FROM THE
PLAN

A Participant may cease
making contributions to the Plan at any time by changing his/her payroll
deduction to zero as described in Article 5.  In order to execute a sale of all or part of
the Shares purchased under the Plan and held by the Plan Administrator, the
Participant must contact the Plan Administrator, or its designee,
directly.  If the Participant desires to
withdraw from the Plan by liquidating all or part of his/her shareholder
interest, he/she shall receive the proceeds from the sale thereof, minus the
commission and other expenses on such sale.

 

ARTICLE 13 — NO TRANSFER OR
ASSIGNMENT

A Participant’s right to
purchase Shares under the Plan through payroll deduction is his/hers alone and
may not be transferred or assigned to, or availed of, by any other person.

 

ARTICLE 14 — TERMINATION OF
EMPLOYEE RIGHTS

All of the employee’s
rights under the Plan will terminate when he/she ceases to be an eligible
employee due to retirement, resignation, death, termination, or any other
reason.  A notice of withdrawal will be
deemed to have been received from a Participant on the day of his/her final
payroll deduction.  If a Participant’s
payroll deductions are interrupted by any legal process, a withdrawal notice
will be deemed as having been received on the day the interruption occurs.

 

In the event of the
employee’s termination of employment for any reason, a Participant will be
required to:

 

1. Sell any shares then
remaining in the Participant’s account; or

2. Transfer all remaining
shares to an individual brokerage account; or

3. Request Computershare
to issue a share certificate to the Participant for any shares remaining in the
Participant’s account.

 

Any fractional shares
remaining in the Participant’s account will be sold and the proceeds will be
sent to the Participant.

 

If you do not take action
within 30 days of notification by Computershare, your shares are issued in
certificate form as described in option 3 above.  You will be sent a certificate representing
your whole shares.  You will also receive
a check equal to your proceeds from the sale of your fractional shares, less
applicable transaction and handling fees.

 

ARTICLE 15 — TERMINATION AND
AMENDMENT TO THE PLAN

The Plan may be
terminated at any time by the Company’s Board of Directors if the interests of
the Company so require.  Upon such
termination, or any other termination of the Plan, all payroll deductions not
used to purchase Shares will be refunded. 
The Board of Directors also reserves the right to amend the Plan, from
time to time, in any respect and authorizes the Committee to approve amendments
to the Plan on its behalf.

 

 

ARTICLE 16 — LOCAL TAX LAWS

If the provisions of the Plan contradict local tax
laws, the local tax laws shall prevail.

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