Document:

Exhibit 10.1 to St. Jude Medical, Inc. Form 8-K dated April 21, 2006

Exhibit 10.1 

STOCK PURCHASE PLAN ENGAGEMENT AGREEMENT 

        Stock Purchase Plan
Engagement Agreement dated as of April 21, 2006 (this “Agreement”) between St. Jude Medical, Inc., a Minnesota
corporation (the “Company”), and Banc of America Securities LLC (“Broker”), acting as agent for
the Company. 

        WHEREAS, the Company desires
to establish a trading plan (subject to the terms and provisions of this Agreement, the “Plan”) that qualifies
for the safe harbors provided by Rule 10b-18 (“Rule 10b-18”) and Rule 10b5-1 (“Rule 10b5-1”)
each under the Securities Exchange Act of 1934, as amended (the “Exchange Act”); and 

        WHEREAS, the Company wishes
to engage Broker as its exclusive agent to make purchases of shares of the common stock, par value $0.10, of the Company (the
“Securities”) on its behalf under the Plan; 

        NOW, THEREFORE, in
consideration of the foregoing and the mutual covenants, agreements, representations and warranties contained in this Agreement
and intending to be legally bound, the parties agree as follows: 

1.    ENGAGEMENT OF BROKER. 

        The Company hereby engages
the Broker as the Company’s exclusive agent to purchase the Securities during the term of this Agreement. Subject to the
terms and conditions set forth herein, Broker hereby accepts such appointment and engagement. 

2.    TERMS OF THE PLAN. 

        A.       Broker
is authorized to begin purchasing the Securities as agent for the Company pursuant to the Plan on April 21, 2006, after the
execution of this Agreement by both parties, and shall cease purchasing the Securities on the Termination Date (as defined below).
The time period beginning on the date purchases are to first be made to the date of the termination of the Plan is referred to
herein as the “Plan Period”. 

        B.       (i)    On
each Trading Day during the Plan Period on which no Market Disruption Event (as defined below) occurs, Broker shall purchase as
agent for the Company and for the account of the Company the lesser of (a) the maximum number of Securities that the Company could
purchase under Rule 10b-18 and (b) number of Securities that Broker is able, subject to market conditions and principles of best
execution, to purchase as agent for the Company and for the account of the Company on such Trading Day using commercially
reasonable means in accordance with the guidelines set forth below (the “Guidelines”). 

	

	Purchase Price Range 	  	Number of Shares to be Purchased 	 
	

	Greater than or equal to $45	 	0 shares	 
	

	Less than $45	 	Up to $700,000,000 of shares	 
	

The Company shall pay to Broker a commission of $0.02 per Security so
purchased. 

        (ii)                 A
“Trading Day” is any day during the Plan Period that the New York Stock Exchange, Inc. (the “Principal
Market”) is open for business and the Securities trade regular way on the Principal Market. “Market Disruption
Event” has the meaning set forth in Section 6.3(a) of the 2002 Equity Derivatives Definitions, as published by the
International Swaps and Derivatives Association, Inc., and references therein to “Exchange” shall be deemed to be
references to the Principal Market. 

        (iii)                 Any
Securities so purchased shall be purchased under ordinary principles of best execution at the then-prevailing market price.
Subject to the terms set forth in this Agreement, Broker shall have full discretion with respect to the execution of all
purchases, and the Company acknowledges and agrees that the Company does not have, and shall not attempt to exercise, any
influence over how, when or whether to effect such purchases of Securities pursuant to the Plan. The Company acknowledges and
agrees that, in acting under this Agreement, Broker will be an independent contractor and will not be acting as the Company’s
trustee or fiduciary or in any similar capacity. 

  

        (iv)                 In
the event that Broker, in its discretion, determines that it is appropriate with regard to any legal, regulatory or
self-regulatory requirements or related policies and procedures (whether or not such requirements, policies or procedures are
imposed by law or have been voluntarily adopted by Broker, and including without limitation Rule 10b-18, Rule 10b-5, Regulation
13D-G and Regulation 14E under the Exchange Act, “Requirements”) for Broker to refrain from purchasing Securities
or to purchase fewer than the otherwise applicable Number of Shares to be Purchased on any Trading Day during the Plan Period,
then Broker may, in its discretion, elect that the Number of Shares to be Purchased for such Trading Day shall be reduced for such
day to an amount determined by Broker in its discretion as appropriate with regard to any Requirements. 

        (v)                 Any
Number of Shares to be Purchased (and the corresponding purchase price limits or ranges) set forth in the Guidelines shall be
adjusted automatically on a proportionate basis to take into account any stock split, reverse stock split or stock dividend with
respect to the Securities or any change in capitalization with respect to the Company or any similar event that occurs during the
Plan Period, as determined by Broker in good faith and a commercially reasonable manner. 

        C.                 Broker
may purchase Securities on the Principal Market, any national securities exchange, in the over-the-counter market, on an automated
trading system or otherwise. 

        D.                 Broker
shall use good faith efforts to execute all purchase transactions under this Agreement in accordance with the timing, price and
volume restrictions contained in subparagraphs (2), (3) and (4) of Rule 10b-18. Nothing herein shall preclude the purchase by
Broker of the Securities for its own account, or the solicitation or execution of purchase or sale orders of the Securities for
the account of Broker’s clients. Please be advised that, due to the manual process involved in executing and reporting trades
on the floor of the New York Stock Exchange, Inc. (the “NYSE”), a trade that is otherwise compliant with the
price restrictions of Rule 10b-18 may appear to have been effected outside of the price restriction. Such a condition typically
occurs as a result of the delays inherent in the NYSE specialist process of reporting a trade to the Consolidated Tape. In those
instances in which there is a delay between the execution and reporting of a trade by the specialist on the NYSE floor, a trade
reported to the Consolidated Tape by another market may cause the NYSE trade report to appear as an “uptick”, i.e., a
trade executed at a price higher than the highest independent bid or last sale price. These conditions are more likely to occur in
actively traded stocks. 

        E.                 It
is the intent of the parties that this Agreement and the Plan comply with the requirements of Rule 10b5-1(c)(1)(i)(B) of the
Exchange Act, and the parties agree that this Agreement shall be interpreted to comply with the requirements of Rule 10b5-1(c) and
the Company shall take no action that results in this transaction not so complying with such requirements. 

        F.                 The
Company also acknowledges and agrees that any amendment, modification or waiver of this Agreement or the Plan, must be effected in
accordance with the requirements for the amendment of a “plan” as defined in Rule 10b5-1(c). Without limiting the
generality of the foregoing, any such amendment, modification or waiver shall be made in good faith and not as part of a plan or
scheme to evade the prohibitions of Rule 10b-5 under the Exchange Act, and no such amendment, modification or waiver shall be made
at any time at which the Company is aware of any material nonpublic information concerning the Company or the Securities. Upon any
amendment, modification or waiver of this Agreement or the Plan, the Company shall immediately deliver to Broker a letter
substantially in the form of Exhibit A hereto. 

3.    REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY. 

        A.                 The
Company is not entering this Agreement “on the basis of” (as defined in Rule 10b5-1(b) under the Exchange Act) any
material nonpublic information concerning the Securities or the business, operations or prospects of the Company. 

        B.                 During
the Plan Period, the Company agrees not to enter into or alter any corresponding or hedging transaction or position with respect
to the securities covered by the Plan (including, without limitation, with respect to any securities convertible or exchangeable
into the Securities) and agrees not to alter or deviate from the terms of the Plan. 

        C.                 The
Company agrees that, during the Plan Period, neither the Company nor its officers or employees shall, directly or indirectly,
communicate any information relating to the Securities or the Company to any employee of Broker or its affiliates involved in
trading the Securities in connection with the transactions contemplated hereby, who currently include the individuals specified in
Annex A hereto. 

2 

        D.                 The
execution and delivery of this Agreement and the consummation of the transactions herein contemplated will not (i) result in a
breach of any of the terms or provisions of, or constitute a default under, any agreement or instrument to which the Company or
any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound, nor will such action result in any
violation of the provisions of the certificate of incorporation, by-laws or other constitutive documents of the Company or any
statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any
of its subsidiaries or any of their respective properties or (ii) conflict with or exceed the authority granted under resolutions
of the board of directors of the Company authorizing this Agreement or the consummation of the Plan. 

        E.                 The
Company has made, and shall use its best efforts during the Plan Period to make in a timely manner, all filings required to be
made by it with the Securities and Exchange Commission, any securities exchange or any other regulatory body with respect to the
transactions contemplated hereby. The Company agrees to immediately notify Broker of any failure or delay in making any such
filings when due. 

        F.                 Without
the prior written consent of Broker, the Company agrees that during the Plan Period (or until the Plan has been terminated, if
earlier) the Company shall not, directly or indirectly (including, without limitation, by means of a cash-settled or other
derivative instrument) purchase, offer to purchase, place any bid or limit order that would effect a purchase of, any Securities
(or an equivalent interest, including a unit of beneficial interest in a trust or limited partnership or a depository share) or
any security convertible into or exchangeable for Securities, except for any Securities tendered to or withheld by the Company to
satisfy the exercise price of any stock option or to satisfy tax withholding obligations upon the exercise of any stock option or
the vesting of any restricted stock under the Company’s stock plans. 

        G.                 The
Company shall notify Broker prior to the opening of trading in the Securities on any day on which the Company makes, or expects to
be made, any public announcement (as defined in Rule 165(f) under the Securities Act) of any merger, acquisition, or similar
transaction involving a recapitalization relating to the Company (other than any such transaction in which the consideration
consists solely of cash and there is no valuation period), and shall promptly notify Broker with information relating to actual
purchases by the Company during the three calendar months preceding such announcement (unless Broker already has such information
relating to actual purchases by the Company). The Company acknowledges that if the Company does not provide such notice and
information to Broker, Broker may in its discretion cease any purchase activity hereunder after such an announcement is made by
the Company until such time as the Company provides Broker with the necessary information. 

        H.                 The
Company shall, on the business day prior to the intended date of such purchase, notify Broker of the intention on the part of any
affiliated purchaser, as defined in Rule 10b-18, of the Company to purchase Securities on any day if such purchase is to be
effected otherwise than through Broker pursuant to this Agreement and Broker shall refrain from purchasing any Securities
hereunder on the day following receipt of such notice. The Company shall be solely responsible for any purchases made by Broker as
the Company’s agent prior to Broker’s receipt of such written notice. Notwithstanding the foregoing, if Broker receives
such notice, Broker may nevertheless be entitled to make, and the Company shall be solely responsible for, a purchase hereunder
pursuant to a bid made before such notice is received by Broker. The Company shall be solely responsible for notifying Broker of
any purchases of Securities by any such affiliated purchaser, and the Company agrees to indemnify and hold harmless Broker for any
failure to so notify Broker or any error in any such notification. The Company also acknowledges that purchases of Securities by
any such affiliated purchaser (including without limitation any purchases caused or influenced by any action of the Company) may
cause the Number of Shares to be Purchased on any Trading Day to be reduced pursuant to Section 2.B(iv) above. The Company
acknowledges that any action it takes that causes or influences any purchase of Securities by any affiliated purchaser must comply
with the standards set forth in Section 2.F above. 

        I.                 The
Company agrees that neither the Company nor any of its affiliates or agents shall take any action that would cause Regulation M
under the Exchange Act (“Regulation M”) to be applicable to any purchases of Securities, or any security for
which the Securities are a reference security (as defined in Regulation M), by the Company or any of its affiliated purchasers (as
defined in Regulation M) during the Plan Period. 

        J.                 The
Company represents and warrants that it has publicly disclosed on April 19, 2006 its intention to institute a program for the
acquisition of the Securities as contemplated hereby. 

        K.                 The
Company acknowledges and agrees that it is not relying, and has not relied, upon Broker or any affiliate of Broker with respect to
the legal, accounting, tax or other implications of this Agreement and that it has conducted its own analyses of the legal,
accounting, tax and other implications hereof. The Company further acknowledges and agrees that neither Broker nor any affiliate
of Broker has acted as its advisor in any capacity in connection with this Agreement or the transactions contemplated hereby. The
Company is entering into this Agreement with a full understanding of all of the terms and risks hereof (economic and otherwise),
has adequate expertise in financial matters to evaluate those terms and risks and is capable of assuming (financially and
otherwise) those risks. 

3 

4.    TERMINATION.  

        A.              This
Agreement and the Plan shall terminate on the Termination Date. “Termination Date” means the earliest to occur of
(i) the close of business on June 30, 2006, (ii) the close of business on the date that the Number of Shares to be Purchased have
been purchased, (iii) any Optional Termination Date (as defined below), (iv) the date on which any Required Termination Notice (as
defined below) is received by Broker, (v) the date that the Company or any other person publicly announces a tender or exchange
offer with respect to the Securities or a merger, acquisition, reorganization, recapitalization or comparable transaction
affecting the Securities as a result of which the Securities are to be exchanged or converted into shares of another company and
(vi) the date that Broker becomes aware of the commencement or impending commencement of any proceedings in respect of or
triggered by the Company’s bankruptcy or insolvency. 

        B.                 This
Agreement may be terminated by either party hereto on written notice to the other party in accordance with Section 5.D. below (the
date of any such termination, an “Optional Termination Date”). 

        C.                 If,
at any time during the Plan Period, any legal or regulatory restriction that is applicable to the Company or the Company’s
affiliates would prohibit any purchase pursuant to the Plan, the Company agrees to give Broker notice of such restriction in
accordance with clause (i) of Section 5.D below as soon as practicable (such notice, a “Required Termination
Notice”). Such notice shall indicate the anticipated duration of the restriction, but shall not include any other
information about the nature of the restriction or its applicability to the Company or otherwise communicate any material
nonpublic information about the Company or the Securities to Broker. 

        D.                 Notwithstanding
the termination of this Agreement, the Company shall be solely responsible for any purchases made by Broker on the Company’s
behalf prior to Broker’s receipt of any notice of termination, and if Broker receives such notice, Broker may nevertheless be
entitled to make, and the Company shall be solely responsible for, a purchase hereunder pursuant to a bid made before such notice
is received by Broker. 

5.    GENERAL.  

        A.                 Payment
for the purchase price of Securities purchased under the Plan for the account of the Company, plus applicable commission, will be
delivered to Broker’s account, which Broker shall specify in writing to the Company from time to time, on a normal three-day
settlement basis. Broker shall give the Company at least 30 days prior notice before changing such account. 

        B.                 The
parties hereto agree and acknowledge that Broker is a “stockbroker” within the meaning of Section 101(53A) of Title 11
of the United States Code (the “Bankruptcy Code”). The parties hereto further agree and acknowledge that this
Agreement is a “securities contract,” as such term is defined in Section 741(7) of the Bankruptcy Code, and Broker is
entitled to the protections afforded by, among other Sections, Sections 362(b)(6), 546(e) and 555 of the Bankruptcy Code.

        C.                 This
Agreement constitutes the entire agreement between the parties with respect to the Plan and supercedes any prior agreements or
understandings with regard to the Plan. 

        D.                 All
notices to Broker under this Agreement shall be given to Broker, ATTN: Chip Gibbs, by (i) facsimile at (415) 835-2514 followed by
telephonic confirmation at (212) 583-8354 or (ii) by certified mail or overnight courier to the address below: 

	  	Banc of America Securities LLC

ATTN: Chip Gibbs

9 W. 57th Street

40th Floor

New York, NY 10019 

        All notices to the Company
under this Agreement shall be given to Company, ATTN: John C. Heinmiller, in the manner specified by this Agreement by (i)
facsimile at (651) 490-4333 followed by telephonic confirmation at (651) 483-2000 or (ii) by certified mail or overnight
courier to the address below: 

	  	St. Jude Medical, Inc.

One Lillehei Plaza

St. Paul, MN 55117

ATTN: John C. Heinmiller 

4 

        E.       The
Company’s rights and obligations under this Agreement may not be assigned or delegated without the written consent of Broker,
and Broker’s rights and obligations under this Agreement may not be assigned or delegated without written consent of the
Company. 

        F.       If
any provision of this Agreement is or becomes inconsistent with any applicable present or future law, rule or regulation, that
provision will be deemed modified or, if necessary, rescinded in order to comply with the relevant law, rule or regulation. All
other provisions of this Agreement will continue and remain in full force and effect. 

        G.       THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK. The parties hereto
irrevocably submit to the non-exclusive jurisdiction of the Federal and state courts located in the Borough of Manhattan, in the
City of New York in any suit or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.

        H.       EACH
PARTY HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHTS TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY. 

5 

        IN WITNESS WHEREOF, the
undersigned have signed this Agreement as of the date first written above. 

	 	ST. JUDE MEDICAL, INC.  
	 
	    	By:    	/s/   John C. Heinmiller 

	 	 	Name:   John C. Heinmiller
Title:     Executive Vice President and 
              Chief Financial Officer 
	 
	 	BANC OF AMERICA SECURITIES LLC  
	 
	    	By:    	/s/   David Moran 

	 	 	Name:   David Moran

Title:     Managing Director 
	 

ANNEX A  

The Company agrees that, during the Plan Period, neither the Company nor its
officers or employees shall, directly or indirectly, communicate any information relating to the Securities or the Company to any
employee of Broker or its affiliates involved in trading the Securities in connection with the transactions contemplated hereby,
who currently include the following individuals: Dmitry S. Genkin, Sean W. Groenewald, Soo-Il Lee, Anthony P. Paquette, Marc
Mezzadri and John Wall, and such other employees as may be identified to the Company in writing by Broker from time to time.

Annex A-1 

EXHIBIT A  

[Company Letterhead] 

[Date]  

Banc of America Securities LLC

9 West 57th Street

New York, NY 10019

Attn: Chip Gibbs 

      Re:    [Amendment/Modification/Waiver] of
Stock Purchase Plan Engagement Agreement 

Ladies and Gentlemen: 

        Reference is made to the
Stock Purchase Plan Engagement Agreement (the “Repurchase Agreement”) dated as of [_________] between St. Jude
Medical, Inc. (the “Company”) and Banc of America Securities LLC (“Broker”). 

        In connection with the
[amendment/modification/waiver] of the Repurchase Agreement, the Company hereby represents and warrants to Broker that on the date
hereof the Company is not aware of any material nonpublic information regarding the Company, and that its decision to
[amend/modify/seek a waiver of] the Repurchase Agreement was made in good faith and not as a part of a plan or scheme to evade the
prohibitions of Rule 10b-5 under the Securities Exchange Act of 1934, as amended. 

	 	Very truly yours, 
	 
	 	ST. JUDE MEDICAL, INC. 
	 
	    	By:    	/s/    

	 	 	Name:   

Title:      
	 

	Acknowledged and agreed to as of
the date first above written,

BANC OF AMERICA SECURITIES LLC 
	 
	By:    	/s/    
	    
	 	Name:   

Title:Exhibit 10.01 to KMG America Corporation Form 8-K dated April 18, 2006

EXHIBIT 10.01  

KMG AMERICA CORPORATION 

2004 EQUITY INCENTIVE PLAN 

As Amended April 18, 2006

	Section 		Page 
	 
	ARTICLE I	 	DEFINITIONS	 	1	 
	 
	1.01.	 	Acquiring Person	 	1	 
	1.02.	 	Affiliate	 	1	 
	1.03.	 	Agreement	 	1	 
	1.04.	 	Award	 	1	 
	1.05.	 	Board	 	1	 
	1.06.	 	Cause	 	1	 
	1.07.	 	Change in Control	 	2	 
	1.08.	 	Code	 	2	 
	1.09.	 	Committee	 	3	 
	1.10.	 	Common Stock	 	3	 
	1.11.	 	Company	 	3	 
	1.12.	 	Continuing Director	 	3	 
	1.13.	 	Control Change Date	 	3	 
	1.14.	 	Corresponding SAR	 	3	 
	1.15.	 	Disability	 	3	 
	1.16.	 	Exchange Act	 	4	 
	1.17.	 	Fair Market Value	 	4	 
	1.18.	 	Good Reason	 	4	 
	1.19.	 	Incentive Award	 	5	 
	1.20.	 	Initial Value	 	5	 
	1.21.	 	Named Executive Officer	 	5	 
	1.22.	 	Option	 	5	 
	1.23.	 	Participant	 	5	 
	1.24.	 	Performance Shares	 	5	 
	1.25.	 	Person	 	5	 
	1.26.	 	Plan	 	6	 
	1.27.	 	Related Entity	 	6	 
	1.28.	 	SAR	 	6	 
	1.29.	 	Stock Award	 	6	 
	1.30.	 	Ten Percent Shareholder	 	6	 
	 
	ARTICLE II	 	PURPOSES	 	7	 
	 
	ARTICLE III	 	ADMINISTRATION	 	8	 
	 
	ARTICLE IV	 	ELIGIBILITY	 	10	 
	 
	ARTICLE V	 	COMMON STOCK SUBJECT TO PLAN	 	11	 
	5.01.	 	Common Stock Issued	 	11	 
	5.02.	 	Aggregate Limit	 	11	 

-i- 

	Section 		Page 
	 
	5.03.	 	Individual Limit	 	11	 
	5.04.	 	Reallocation of Shares	 	11	 
	 
	ARTICLE VI	 	OPTIONS	 	12	 
	 
	6.01.	 	Grant	 	12	 
	6.02.	 	Option Price	 	12	 
	6.03.	 	Maximum Option Period	 	12	 
	6.04.	 	Nontransferability	 	12	 
	6.05.	 	Transferable Options	 	12	 
	6.06.	 	Exercise	 	13	 
	6.07.	 	Payment	 	13	 
	6.08.	 	Employee Status	 	14	 
	6.09.	 	Change in Control	 	14	 
	6.10.	 	Stockholder Rights	 	14	 
	6.11.	 	Disposition of Shares	 	15	 
	6.12.	 	No Liability of Company	 	15	 
	 
	ARTICLE VII	 	SARS	 	16	 
	 
	7.01.	 	Grant	 	16	 
	7.02.	 	Maximum SAR Period	 	16	 
	7.03.	 	Nontransferability	 	16	 
	7.04.	 	Transferable SARs	 	16	 
	7.05.	 	Exercise	 	17	 
	7.06.	 	Change in Control	 	17	 
	7.07.	 	Employee Status	 	18	 
	7.08.	 	Settlement	 	18	 
	7.09.	 	Stockholder Rights	 	18	 
	 
	ARTICLE VIII	 	STOCK AWARDS	 	19	 
	 
	8.01.	 	Award	 	19	 
	8.02.	 	Vesting	 	19	 
	8.03.	 	Performance Objectives	 	19	 
	8.04.	 	Employee Status	 	20	 
	8.05.	 	Change in Control	 	20	 
	8.06.	 	Stockholder Rights	 	20	 
	 
	ARTICLE IX	 	PERFORMANCE SHARE AWARDS	 	22	 
	 
	9.01.	 	Grant	 	22	 
	9.02.	 	Earning the Award	 	22	 
	9.03.	 	Maximum Performance Share Award Period	 	23	 
	9.04.	 	Payment	 	23	 
	9.05.	 	Stockholder Rights	 	23	 
	9.06.	 	Nontransferability	 	23	 

-ii- 

	Section 		Page 
	 
	9.07.	 	Transferable Performance Shares	 	23	 
	9.08.	 	Employee Status	 	23	 
	9.09.	 	Change in Control	 	24	 
	 
	ARTICLE X	 	INCENTIVE AWARDS	 	25	 
	 
	10.01.	 	Grant	 	25	 
	10.02.	 	Terms and Conditions	 	25	 
	10.03.	 	Maximum Incentive Award Period	 	26	 
	10.04.	 	Nontransferability	 	26	 
	10.05.	 	Transferable Incentive Awards	 	26	 
	10.06.	 	Employee Status	 	26	 
	10.07.	 	Change in Control	 	26	 
	10.08.	 	Stockholder Rights	 	27	 
	 
	ARTICLE XI	 	ADJUSTMENT UPON CHANGE IN COMMON STOCK	 	28	 
	 
	ARTICLE XII	 	COMPLIANCE WITH LAW AND APPROVAL OF REGULATORY BODIES	 	29	 
	 
	12.01.	 	Compliance	 	29	 
	12.02.	 	Postponement of Exercise or Payment	 	29	 
	12.03.	 	Forfeiture of Payment	 	30	 
	 
	ARTICLE XIII	 	GENERAL PROVISIONS	 	31	 
	 
	13.01.	 	Effect on Employment and Service	 	31	 
	13.02.	 	Unfunded Plan	 	31	 
	13.03.	 	Rules of Construction	 	31	 
	13.04.	 	Tax Withholding and Reporting	 	31	 
	13.05.	 	Reservation of Shares	 	31	 
	13.06.	 	Governing Law	 	32	 
	13.07.	 	Other Actions	 	32	 
	13.08.	 	Other Conditions	 	32	 
	13.09.	 	Forfeiture Provisions	 	33	 
	 
	ARTICLE XIV	 	AMENDMENT	 	34	 
	 
	ARTICLE XV	 	DURATION OF PLAN	 	35	 
	 
	ARTICLE XVI	 	EFFECTIVE DATE OF PLAN	 	36	 

-iii- 

ARTICLE I

DEFINITIONS  

1.01.    Acquiring Person  

        Acquiring Person means that a
Person, considered alone or as part of a “group” within the meaning of Section 13(d)(3) of the Securities Exchange Act
of 1934, as amended, is or becomes directly or indirectly the beneficial owner (as defined in Rule 13d-3 under the Exchange Act)
of securities representing more than fifty percent (50%) of the Company’s then outstanding securities entitled to vote
generally in the election of the Board. 

1.02.    Affiliate  

        Affiliate means any
“subsidiary” or “parent” corporation (as such terms are defined in Section 424 of the Code) of the Company.

1.03.    Agreement  

        Agreement means a written
agreement (including any amendment or supplement thereto) between the Company and a Participant specifying the terms and
conditions of an Award granted to such Participant. 

1.04.    Award  

        Award means an Incentive
Award, Option, Performance Share, SAR or Stock Award granted under this Plan. 

1.05.    Board  

        Board means the Board of
Directors of the Company. 

1.06.    Cause  

        Cause has the same definition
as under any employment or service agreement between the Company or any Affiliate and the Participant or, if no such employment or
service agreement exists or if such employment or service agreement does not contain any such definition, Cause means that the
Participant (i) has committed fraud or misappropriated, stolen or embezzled funds or property from the Company or an Affiliate or
secured or attempted to secure personally any profit in connection with any transaction entered into on behalf of the Company or
any Affiliate, (ii) has been convicted of, or entered a plea of guilty or “nolo contendere” to, any criminal act
or has committed any other act of willful misconduct which brings the Participant into disrepute or is likely to cause material
harm to the Company’s (or any Affiliate’s) reputation, business, customer or supplier relations, financial condition or
prospects, (iii) has, notwithstanding not less than 30 days’ prior written notice, willfully failed to comply with any lawful
directives of the Board, the Board of Directors of any Affiliate or any supervisory personnel of the Participant or otherwise
failed to perform in a satisfactory manner his or her duties with the Company or any Affiliate (other than by reason of illness or
temporary disability), (iv) has violated or breached 

-1- 

any material law or regulation to the material detriment of the Company or
any Affiliate or its or their business, (v) has breached any non-competition, non-disclosure or non-solicitation agreement which
causes or is reasonably likely to cause material harm to the Company or any Affiliate or (vi) has committed any act of willful
malfeasance or gross negligence in a matter of material importance to the Company or any Affiliate. For purposes of the Plan,
other than where the definition of Cause is determined under any employment or service agreement between the Company or any
Affiliate and the Participant in which case such employment or service agreement shall control, in no event shall any termination
of employment or service be deemed for Cause unless the Company’s Chief Executive Officer concludes that the situation
warrants a determination that the Participant’s employment or service terminated for Cause; in the case of the Chief
Executive Officer, any determination that the Chief Executive Officer’s employment terminated for Cause shall be made by the
Board acting without the Chief Executive Officer. 

1.07.    Change in Control  

        “Change in Control”
means (i) a Person is or becomes an Acquiring Person; (ii) a transfer of all or substantially all of the Company’s assets on
a consolidated basis, as reported in the Company’s consolidated financial statements; (iii) a merger, consolidation or
statutory share exchange with a Person, regardless of whether the Company is intended to be the surviving or resulting entity
after the merger, consolidation or statutory share exchange, other than a transaction that results in the voting securities
of the Company carrying the right to vote in elections of persons to the Board outstanding immediately prior to the closing of the
transaction continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving
entity) more than 50% (fifty percent) of the Company’s voting securities carrying the right to vote in elections of persons
to the Company’s Board, or such securities of such surviving entity, outstanding immediately after the closing of such
transaction; (iv) the Continuing Directors cease for any reason to constitute a majority of the Board; (v) a liquidation of the
Company or the commencement of actions constituting a plan of liquidation or the closing of a liquidation agreement); or (vi) a
majority of the independent members of the Board adopt a resolution to the effect that, in their judgment, as a consequence of any
one or more transactions or events or series of transactions or events, a change in control of the Company has effectively
occurred. The independent members of the Board shall be entitled to exercise their sole and absolute discretion in exercising
their judgment and in the adoption of such resolution, whether or not any such transaction(s) or event(s) might be deemed,
individually or collectively, to satisfy any of the criteria set forth in subparagraphs (i) through (v) above. Notwithstanding the
foregoing, no event resulting from the initial public offering of the Company’s securities as contemplated by the
Company’s Form S-1 Registration Statement under the Securities Act of 1933, dated August 3, 2004, as amended (the
“Initial Public Offering”), shall constitute a Change in Control. 

1.08.    Code  

        Code means the Internal
Revenue Code of 1986, and any amendments thereto. 

-2- 

1.09.    Committee  

        Committee means the
Compensation Committee of the Board if the Board appoints one to administer the Plan, or the Board itself if no such Compensation
Committee is appointed. If such Compensation Committee is appointed, if and to the extent deemed necessary by the Board, such
Compensation Committee shall consist of two or more directors, all of whom are “non-employee directors” within the
meaning of Rule 16b-3 under the Exchange Act and, after the transition period prescribed by the regulations under Code Section
162(m), “outside directors” within the meaning of Code Section 162(m). 

1.10.    Common Stock  

        Common Stock means the common
stock, par value $0.01 per share, of the Company. 

1.11.    Company  

        Company means KMG America
Corporation, a Virginia corporation, or any successor thereto. 

1.12.    Continuing Director  

        Continuing Director means any
member of the Board, while a member of the Board and (i) who was a member of the Board at the time of the Initial Public Offering
or (ii) whose nomination for or election to the Board was recommended or approved by a majority of the Continuing Directors.

1.13.    Control Change Date  

        Control Change Date means the
date on which a Change in Control occurs. If a Change in Control occurs on account of a series of transactions, the “Control
Change Date” is the date of the last of such transactions. 

1.14.    Corresponding SAR  

        Corresponding SAR means an
SAR that is granted in relation to a particular Option and that can be exercised only upon the surrender to the Company,
unexercised, of that portion of the Option to which the SAR relates. 

1.15.    Disability  

        Disability has the same
definition as under the Company’s long-term disability insurance plan or, if the Participant does not participate in such
plan or the Company does not sponsor such plan or discontinues to sponsor such plan, the Participant shall be considered to have a
disability if he or she qualifies for and receives Social Security disability benefits; provided, however, that with respect to an
incentive stock option, Disability means the inability of a Participant to engage in any substantial gainful activity by reason of
any medically determinable physical or mental 

-3- 

impairment which can be expected to result in death or which has lasted or
can be expected to last for a continuous period of not less than 12 months as defined in Code Section 22(e)(3). 

1.16.    Exchange Act  

        Exchange Act means the
Securities Exchange Act of 1934, as amended. 

1.17.    Fair Market Value  

        Fair Market Value of a share
of Common Stock means, on any given date, the fair market value of a share of Common Stock as the Committee in its discretion
shall determine; provided, however, that the Committee shall determine Fair Market Value without regard to any restriction other
than a restriction which, by its terms, will never lapse and, if the shares of Common Stock are traded on any national stock
exchange or quotation system, the Fair Market Value of a share of Common Stock shall be the closing price of a share of Common
Stock as reported on such stock exchange or quotation system on such date, or if the shares of Common Stock are not traded on such
stock exchange or quotation system on such date, then on the next preceding day that the shares of Common Stock were traded on
such stock exchange or quotation system, all as reported by such source as the Committee shall select. The Fair Market Value that
the Committee determines shall be final, binding and conclusive on the Company, any Affiliate and each Participant. 

1.18.    Good Reason  

        Good Reason has the same
definition as under any employment or service agreement between the Company or any Affiliate and the Participant or, if no such
employment or service agreement exists or if such employment or service agreement does not contain any such definition, Good
Reason means the Participant voluntarily terminates employment or service on account of and within ninety (90) days of (i)
a failure by the Company or any Affiliate to comply with any material provision of any employment or service agreement between the
Company or the Affiliate and the Participant (other than the payment obligations referred to in clause (v) below) which has not
been cured within thirty (30) days after notice of such noncompliance has been given by the Participant to the Company or the
Affiliate, as applicable; (ii) the assignment to the Participant of any material duties inconsistent with the Participant’s
position with the Company or any Affiliate or a substantial adverse alteration in the nature or status of the Participant’s
responsibilities, in either event without the Participant’s consent; (iii) a material reduction in employee benefits, other
than a reduction generally applicable to similarly situated employees of the Company or the Affiliate, as applicable, without the
Participant’s consent; (iv) relocation of the Participant’s principal place of employment outside a fifty (50) mile
radius of the Participant’s then current principal place of employment without the Participant’s consent; or
(v) any failure by the Company or an applicable Affiliate to pay the Participant’s base salary or any incentive bonus to
which he or she is entitled, which failure has not been cured within ten (10) days after notice of such noncompliance has been
given by the Participant to the Company or the Affiliate, as applicable. For purposes of the Plan, other than where the definition
of Good Reason is determined under any employment or service agreement between the Company or any Affiliate and the Participant in
which case such employment of service agreement shall control, 

-4- 

the Committee shall determine whether any termination of employment or
service shall be deemed for Good Reason. 

1.19.    Incentive Award  

        Incentive Award means an
award stated with reference to a specified dollar amount which, subject to such terms and conditions as may be prescribed by the
Committee, entitles the Participant to receive shares of Common Stock from the Company or an Affiliate. 

1.20.    Initial Value  

        Initial Value means, with
respect to a Corresponding SAR, the option price per share of the related Option and, with respect to an SAR granted independently
of an Option, the Fair Market Value of one share of Common Stock on the date of grant. 

1.21.    Named Executive Officer  

        Named Executive Officer means
a Participant who, as of the last day of a taxable year, is the Chief Executive Officer of the Company (or is acting in such
capacity) or one of the four highest compensated officers of the Company (other than the Chief Executive Officer) or is otherwise
one of the group of “covered employees”, as defined in the Treasury Regulations promulgated under Code Section 162(m).

1.22.    Option  

        Option means a stock option
that entitles the holder to purchase from the Company a stated number of shares of Common Stock at the price set forth in an
Agreement. 

1.23.    Participant  

        Participant means an employee
of the Company or an Affiliate, a non-employee member of the Board, or a person or entity that provides services to the Company or
an Affiliate and who satisfies the requirements of Article IV and is selected by the Committee to receive an Award.

1.24.    Performance Shares  

        Performance Shares means an
award, in the amount determined by the Committee, stated with reference to a specified number of shares of Common Stock, that in
accordance with the terms of an Agreement entitles the holder to receive a cash payment or shares of Common Stock or a combination
thereof. 

1.25.    Person  

        “Person” means any
human being, firm, corporation, partnership, or other entity. “Person” also includes any human being, firm, corporation,
partnership, or other entity as defined in sections 13(d)(3) and 14(d)(2) of the Exchange Act. The term “Person” does
not include the Company or any Related Entity, and the term Person does not include any employee-

-5- 

benefit plan maintained by the Company or any Related Entity, or any person
or entity organized, appointed, or established by the Company or any Related Entity for or pursuant to the terms of any such
employee-benefit plan, unless the Board determines that such an employee-benefit plan or such person or entity is a
“Person”. 

1.26.    Plan  

        Plan means this KMG America
Corporation 2004 Equity Incentive Plan, in its current form and as hereafter amended. 

1.27.    Related Entity  

        Related Entity means any
entity that is part of a controlled group of corporations or is under common control with the Company within the meaning of
Sections 1563(a), 414(b) or 414(c) of the Code. 

1.28.    SAR  

        SAR means a stock
appreciation right that in accordance with the terms of an Agreement entitles the holder to receive a number of shares of Common
Stock, or in the discretion of the Committee, a cash award, or a combination of shares of Common Stock and cash, based on the
increase in the Fair Market Value of the shares underlying the stock appreciation right during a stated period specified by the
Committee. References to “SARs” include both Corresponding SARs and SARs granted independently of Options, unless the
context requires otherwise. 

1.29.    Stock Award  

        Stock Award means shares of
Common Stock granted to a Participant under Article VIII. 

1.30.    Ten Percent Shareholder  

        Ten Percent Shareholder means
any individual who (considering the stock attribution rules described in Code Section 424(d)) owns stock possessing more than 10
percent of the total combined voting power of all classes of stock of the Company or any Affiliate. 

-6- 

ARTICLE II

PURPOSES  

        The Plan is intended to
assist the Company and its Affiliates in recruiting and retaining individuals and other service providers with ability and
initiative by enabling such persons or entities to participate in the future success of the Company and its Affiliates and to
associate their interests with those of the Company and its stockholders. The Plan is intended to permit the grant of both Options
qualifying under Section 422 of the Code (“incentive stock options”) and Options not so qualifying, and the grant
of SARs, Stock Awards, Performance Shares and Incentive Awards in accordance with the Plan and procedures that may be established
by the Committee. No Option that is intended to be an incentive stock option shall be invalid for failure to qualify as an
incentive stock option. The proceeds received by the Company from the sale of shares of Common Stock pursuant to this Plan shall
be used for general corporate purposes. 

-7- 

ARTICLE III

ADMINISTRATION  

        The Plan shall be
administered by the Committee. The Committee shall have authority to grant Awards upon such terms (not inconsistent with the
provisions of this Plan) as the Committee may consider appropriate. Such terms may include conditions (in addition to those
contained in this Plan) on the exercisability of all or any part of an Option or SAR, the transferability or forfeitability of a
Stock Award, or the grant or settlement of Performance Shares or an Incentive Award. Notwithstanding any such conditions, the
Committee may, in its discretion, accelerate the time at which any Option or SAR may be exercised, or the time at which a Stock
Award may become transferable or nonforfeitable or the time at which an Incentive Award or award of Performance Shares may be
settled. In addition, the Committee shall have complete authority to interpret all provisions of this Plan; to prescribe the form
of Agreements; to adopt, amend, and rescind rules and regulations pertaining to the administration of the Plan; and to make all
other determinations necessary or advisable for the administration of this Plan. The express grant in the Plan of any specific
power to the Committee shall not be construed as limiting any power or authority of the Committee. Any decision made, or action
taken, by the Committee in connection with the administration of this Plan shall be final and conclusive. The members of the
Committee shall not be liable for any act done in good faith with respect to this Plan or any Agreement or Award. All expenses of
administering this Plan shall be borne by the Company. 

        To the extent applicable law
so permits, the Committee, in its discretion, may delegate to one or more officers of the Company all or part of the
Committee’s authority and duties with respect to Awards to be granted to individuals who are not subject to the reporting and
other provisions of Section 16 of the Exchange Act and, after the transition period prescribed by the regulations under Code
Section 162(m), who are not Named Executive Officers. The Committee may revoke or amend the terms of a delegation at any time but
such action shall not invalidate any prior actions of the Committee’s delegate or delegates that were consistent with the
terms of the Plan and the Committee’s prior delegation. If and to the extent deemed necessary by the Board, all Awards
granted to any individual who is subject to the reporting and other provisions of Section 16 of the Exchange Act shall be made by
a Committee comprised solely of two or more directors, all of whom are “non-employee directors” within the meaning of
Rule 16b-3 under the Exchange Act and, after the transition period prescribed by the regulations under Code Section 162(m), all
Awards granted to any individual who is a Named Executive Officer shall be made by a Committee comprised solely of two or more
directors, all of whom are “outside directors” within the meaning of Code Section 162(m). 

        The Company shall bear all
expenses of administering this Plan. The Company shall indemnify and hold harmless each person who is or shall have been a member
of the Committee acting as administrator of the Plan, or any delegate of such, against and from any cost, liability, loss or
expense that may be imposed upon or reasonably incurred by such person in connection with or resulting from any action, claim,
suit, or proceeding to which such person may be a party or in which such person may be involved by reason of any action taken or
not taken under the Plan and against and from any and all amounts paid by such person in settlement thereof, with 

-8- 

the Company’s approval, or paid by such person in satisfaction of any
judgment in any such action, suit, or proceeding against such person, provided he or she shall give the Company an opportunity, at
its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf.
Notwithstanding the foregoing, the Company shall not indemnify and hold harmless any such person if (i) applicable law or the
Company’s Articles of Incorporation or Bylaws prohibit such indemnification or (ii) such person did not act in good faith and
in a manner that such person believed to be consistent with the Plan or such person’s conduct constituted gross negligence or
willful misconduct. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which
such persons may be entitled under the Company’s Articles of Incorporation or Bylaws, as a matter of law or otherwise, or
under any other power that the Company may have to indemnify such person or hold him or her harmless. The provisions of the
foregoing indemnity shall survive indefinitely the term of this Plan. 

-9- 

ARTICLE IV

ELIGIBILITY  

        Any employee of the Company
or an Affiliate (including a corporation that becomes an Affiliate after the adoption of this Plan) and any non-employee member of
the Board is eligible to participate in this Plan. In addition, any other person or entity that provides services to the Company
or an Affiliate is eligible to participate in this Plan if the Board, in its sole discretion, determines that it is in the best
interest of the Company. 

-10- 

ARTICLE V

COMMON STOCK SUBJECT TO PLAN  

5.01.    Common Stock Issued  

        Upon the issuance of shares
of Common Stock pursuant to an Award, the Company may deliver to the Participant shares of Common Stock or treasury shares from
its authorized but unissued Common Stock. 

5.02.    Aggregate Limit  

        The maximum aggregate number
of shares of Common Stock that may be issued under this Plan shall be 2,827,500. One hundred percent (100%) of such shares may be
issued pursuant to Options or any other type of Award. In addition, the maximum aggregate number of shares of Common Stock that
may be issued under this Plan and the foregoing limits shall be subject to adjustment as provided in Article XI. 

5.03.    Individual Limit  

        In any calendar year, no
Participant may receive Options, SARs, Stock Awards, Performance Shares or any combination of each that relate to more than
350,000 shares. This Section 5.03 applies only with respect to Awards that are made at the end of the transition period prescribed
by the regulations under Code Section 162(m). 

5.04.    Reallocation of Shares  

        If an Option is terminated,
in whole or in part, for any reason other than its exercise or the exercise of a Corresponding SAR that is settled with shares of
Common Stock, the number of shares of Common Stock allocated to the Option or portion thereof may be reallocated to other Awards
to be granted under this Plan. If an SAR is terminated, in whole or in part, for any reason other than its exercise that is
settled with shares of Common Stock or the exercise of a related Option, the number of shares of Common Stock allocated to the SAR
or portion thereof may be reallocated to other Awards to be granted under this Plan. If an award of Performance Shares is
terminated, in whole or in part, for any reason other than its settlement with shares of Common Stock, the number of shares
allocated to the Performance Shares or portion thereof may be reallocated to other Awards to be granted under this Plan. If a
Stock Award is forfeited, in whole or in part, for any reason, the number of shares of Common Stock allocated to the Stock Award
or portion thereof may be reallocated to other Awards to be granted under this Plan. 

-11- 

ARTICLE VI

OPTIONS  

6.01.    Grant  

        In accordance with the
provisions of Article IV, the Committee will designate each individual or entity to whom an Option is to be granted and will
specify the number of shares of Common Stock covered by such grant. Notwithstanding any other provision of the Plan or any
Agreement, the Committee may only grant an incentive stock option to an individual who is an employee of the Company or an
Affiliate. 

6.02.    Option Price  

        The price per share of Common
Stock purchased on the exercise of an Option shall be determined by the Committee on the date of grant, but shall not be less than
the Fair Market Value of a share of Common Stock on the date the Option is granted. However, if at the time of grant of an Option
that is intended to be an incentive stock option the Participant is a Ten Percent Shareholder, the price per share of Common Stock
purchased on the exercise of such Option shall not be less than 110% of the Fair Market Value of a share of Common Stock on the
date the Option is granted. 

6.03.    Maximum Option Period  

        The maximum period in which
an Option may be exercised shall be determined by the Committee on the date of grant, except that no Option shall be exercisable
after the expiration of ten years from the date such Option was granted (five years from the date such Option was granted in the
event of an incentive stock option granted to a Ten Percent Shareholder). 

6.04.    Nontransferability  

        Except as provided in Section
6.05, each Option granted under this Plan shall be nontransferable except by will or by the laws of descent and distribution. In
the event of any transfer of an Option (by the Participant or his transferee), the Option and any Corresponding SAR that relates
to such Option must be transferred to the same person or persons or entity or entities. Except as provided in Section 6.05, during
the lifetime of the Participant to whom the Option is granted, the Option may be exercised only by the Participant. No right or
interest of a Participant in any Option shall be liable for, or subject to, any lien, obligation, or liability of such
Participant. 

6.05.    Transferable Options  

        Section 6.04 to the contrary
notwithstanding, if the Agreement provides, an Option that is not an incentive stock option may be transferred by a Participant to
the Participant’s children, grandchildren, spouse, one or more trusts for the benefit of such family members or a partnership
in which such family members are the only partners, on such terms and conditions as appropriate so that such transferees are
included in the class of transferees who may rely on a Form S-8 

-12- 

Registration Statement under the Securities Act of 1933 to sell shares
issuable upon exercise of Options granted under the Plan. The holder of an Option transferred pursuant to this Section shall be
bound by the same terms and conditions that governed the Option during the period that it was held by the Participant; provided,
however, that such transferee may not transfer the Option except by will or the laws of descent and distribution. In the event of
any transfer of an Option (by the Participant or his transferee), the Option and any Corresponding SAR that relates to such Option
must be transferred to the same person or persons or entity or entities. 

6.06.    Exercise  

        Subject to the provisions of
this Plan and if an applicable Agreement does not provide for when Options shall become exercisable, a Participant’s Options
shall become exercisable with respect to one-fourth of the shares of Common Stock subject to the Options on each of the first,
second, third and fourth anniversaries of the date of grant, provided the Participant has been continuously employed by or has
continuously provided services to the Company or an Affiliate as of each such date. Additionally, if the Committee so provides in
an applicable Agreement, the Participant’s outstanding Options shall become exercisable with respect to one hundred percent
(100%) of the shares of Common Stock subject to the Options that have not previously become exercisable upon (i) involuntary
termination of the Participant’s employment or service by the Company or an Affiliate other than for Cause, (ii) voluntary
termination of the Participant’s employment or service with the Company or an Affiliate by the Participant for Good Reason,
(iii) the Participant’s death while still employed by or providing services to the Company or an Affiliate or (iv) the
Participant’s Disability while still employed by or providing services to the Company or an Affiliate. Notwithstanding the
foregoing, incentive stock options (granted under the Plan and all plans of the Company and its Affiliates) may not be first
exercisable in a calendar year for shares of Common Stock having a Fair Market Value (determined as of the date the Option is
granted) exceeding $100,000. If the limitation is exceeded, the Options that cause the limitation to be exceeded shall be treated
as nonqualified stock options. An Option shall be exercised in such a manner and in compliance with such requirements as the
Committee shall determine. An Option granted under this Plan may be exercised with respect to any number of whole shares less than
the full number for which the Option could be exercised. A partial exercise of an Option shall not affect the right to exercise
the Option from time to time in accordance with this Plan and the applicable Agreement with respect to the remaining shares
subject to the Option. The exercise of an Option shall result in the termination of any Corresponding SAR to the extent of the
number of shares with respect to which the Option is exercised. 

6.07.    Payment  

        Subject to rules established
by the Committee and unless provided otherwise in an Agreement, payment of all or part of the Option price may be made in cash,
certified check, by tendering shares of Common Stock (which, if acquired from the Company, have been held by the Participant for
at least six months) or by a broker-assisted cashless exercise. If shares of Common Stock are used to pay all or part of the
Option price, the sum of the cash and cash equivalent and the Fair Market Value (determined as of the day preceding the date of
exercise) of 

-13- 

the shares surrendered must not be less than the Option price of the shares
for which the Option is being exercised. 

6.08.    Employee Status  

        For purposes of determining
the applicability of Section 422 of the Code (relating to incentive stock options), or in the event that the terms of any
Option provide that it may be exercised only during employment or continued service or within a specified period of time after
termination of employment or continued service, the Committee may decide to what extent leaves of absence for governmental or
military service, illness, temporary disability, or other reasons shall not be deemed interruptions of continuous employment or
service. 

6.09.    Change in Control  

        Notwithstanding any provision
of any Agreement, in the event of or in anticipation of a Change in Control, the Committee in its discretion (i) may declare that
some or all outstanding Options previously granted under the Plan, whether or not then exercisable, shall terminate as of a date
before or on the Control Change Date without any payment to the holder of the Option, provided the Committee gives prior written
notice to the Participants of such termination and gives such Participants the right to exercise their outstanding Options before
such date to the extent then exercisable or (ii) may terminate before or on the Control Change Date some or all outstanding
Options previously granted under the Plan, whether or not then exercisable, in consideration of payment to the holder of the
Option, with respect to each share of Common Stock for which the Option is then exercisable, of the excess, if any, of the Fair
Market Value on such date of the Common Stock subject to the exercisable portion of the Option over the Option price. The payment
described in (ii) above may be made in any manner the Committee determines, including in cash, stock or other property. The
Committee may take the actions described in (i) or (ii) above with respect to Options that are not then exercisable whether or not
the Participant will receive any payment therefor. The Committee in its discretion may take the actions described in (i) or (ii)
above contingent on consummation of the Change in Control and with respect to some or all outstanding Options, whether or not then
exercisable, or on an Option-by-Option basis, which actions need not be uniform with respect to all outstanding Options. However,
the Options shall not be terminated to the extent that written provision is made for their continuance, assumption or substitution
by the Company or a successor employer or its parent or subsidiary in connection with the Change in Control. If the Committee so
provides in an applicable Agreement, a Participant’s outstanding Options shall be fully exercisable on and after a Control
Change Date or immediately before the date the Options will be terminated in connection with the Change in Control, as described
above, provided the Participant has been continuously employed by or has continuously provided services to the Company or an
Affiliate as of such time. 

6.10.    Stockholder Rights  

        No Participant shall have any
rights as a stockholder with respect to shares subject to his Option until the date of exercise of such Option. 

-14- 

6.11.    Disposition of Shares  

        A Participant shall notify
the Company of any sale or other disposition of shares of Common Stock acquired pursuant to an Option that was an incentive stock
option if such sale or disposition occurs (i) within two years of the grant of an Option or (ii) within one year of the
issuance of shares of Common Stock to the Participant. Such notice shall be in writing and directed to the Secretary of the
Company. 

6.12.    No Liability of Company  

        The Company shall not be
liable to any Participant or any other person if the Internal Revenue Service or any court or other authority having jurisdiction
over such matter determines for any reason that an Option intended to be an incentive stock option and granted hereunder does not
qualify as an incentive stock option. 

-15- 

ARTICLE VII

SARS  

7.01.    Grant  

        In accordance with the
provisions of Article IV, the Committee will designate each individual or entity to whom SARs are to be granted and will
specify the number of shares of Common Stock covered by such grant. For purposes of the foregoing limit, an Option and
Corresponding SAR shall be treated as a single Award. In addition, no Participant may be granted Corresponding SARs (under this
Plan and all other incentive stock option plans of the Company and its Affiliates) that are related to incentive stock options
which are first exercisable in any calendar year for shares of Common Stock having an aggregate Fair Market Value (determined as
of the date the related Option is granted) that exceeds $100,000. 

7.02.    Maximum SAR Period  

        The term of each SAR shall be
determined by the Committee on the date of grant, except that no SAR shall have a term of more than ten years from the date such
SAR was granted (five years for a Corresponding SAR that is related to an incentive stock option and that is granted to a Ten
Percent Shareholder). 

7.03.    Nontransferability  

        Except as provided in Section
7.04, each SAR granted under this Plan shall be nontransferable except by will or by the laws of descent and distribution. In the
event of any such transfer, a Corresponding SAR and the related Option must be transferred to the same person or persons or entity
or entities. Except as provided in Section 7.04, during the lifetime of the Participant to whom the SAR is granted, the SAR may be
exercised only by the Participant. No right or interest of a Participant in any SAR shall be liable for, or subject to, any lien,
obligation, or liability of such Participant. 

7.04.    Transferable SARs  

        Section 7.03 to the contrary
notwithstanding, if the Agreement so provides, an SAR, other than a Corresponding SAR that is related to an incentive stock
option, may be transferred by a Participant to the Participant’s children, grandchildren, spouse, one or more trusts for the
benefit of such family members or a partnership in which such family members are the only partners, on such terms and conditions
as appropriate so that such transferees are included in the class of transferees who may rely on a Form S-8 Registration Statement
under the Securities Act of 1933 to sell shares received pursuant to Awards granted under the Plan. The holder of an SAR
transferred pursuant to this Section shall be bound by the same terms and conditions that governed the SAR during the period that
it was held by the Participant; provided, however, that such transferee may not transfer the SAR except by will or the laws of
descent and distribution. In the event of any transfer of a Corresponding SAR (by the Participant or his transferee), the
Corresponding SAR and the related Option must be transferred to the same person or person or entity or entities. 

-16- 

7.05.    Exercise  

        Subject to the provisions of
this Plan and if an applicable Agreement does not provide for when an SAR shall become exercisable, an SAR shall become
exercisable with respect to one-fourth of the shares of Common Stock covered by the grant on each of the first, second, third and
fourth anniversaries of the date of grant, provided the Participant has been continuously employed by or has continuously provided
services to the Company or an Affiliate as of each such date. Additionally, if the Committee so provides in an applicable
Agreement, an SAR shall become exercisable with respect to one hundred percent (100%) of the shares of Common Stock covered by the
grant that have not previously become exercisable upon (i) involuntary termination of the Participant’s employment or service
by the Company or an Affiliate other than for Cause, (ii) voluntary termination of the Participant’s employment or service
with the Company or an Affiliate by the Participant for Good Reason, (iii) the Participant’s death while still employed by or
providing services to the Company or an Affiliate or (iv) the Participant’s Disability while still employed by or providing
services to the Company or an Affiliate. Notwithstanding the foregoing, an SAR may be exercised only to the extent that the
related Option (in the case of a Corresponding SAR) is exercisable and only when the Fair Market Value of the Common Stock that is
subject to the exercise exceeds the Initial Value of the SAR. An SAR granted under this Plan may be exercised with respect to any
number of whole shares less than the full number for which the SAR could be exercised. A partial exercise of an SAR shall not
affect the right to exercise the SAR from time to time in accordance with this Plan and the applicable Agreement with respect to
the remaining shares subject to the SAR. The exercise of a Corresponding SAR shall result in the termination of the related Option
to the extent of the number of shares with respect to which the SAR is exercised. 

7.06.    Change in Control  

        Notwithstanding any provision
of any Agreement, in the event of or in anticipation of a Change in Control, the Committee in its discretion (i) may declare that
some or all outstanding SARs previously granted under the Plan, whether or not then exercisable, shall terminate as of a date
before or on the Control Change Date without any payment to the holder of the SAR, provided the Committee gives prior written
notice to the Participants of such termination and gives such Participants the right to exercise their outstanding SARs before
such termination date to the extent then exercisable or (ii) may terminate before or on the Control Change Date some or all
outstanding SARs previously granted under the Plan, whether or not then exercisable, in consideration of payment to the holder of
the SAR, with respect to each share of Common Stock for which the SAR is then exercisable, of the excess, if any, of the Fair
Market Value of such Common Stock on such date over the Initial Value of the SAR. The payment described in (ii) above may be made
in any manner the Committee determines, including in cash, stock or other property. The Committee may take the actions described
in (i) or (ii) above with respect to SARs that are not then exercisable whether or not the Participant will receive any payment
therefor. The Committee in its discretion may take the actions described in (i) or (ii) above contingent on consummation of the
Change in Control and with respect to some or all outstanding SARs, whether or not then exercisable, or on an SAR-by-SAR basis,
which actions need not be uniform with respect to all outstanding SARs. Notwithstanding the foregoing, no 

-17- 

payment shall be made with respect to a Corresponding SAR to the extent the
Committee made a payment with respect to the Option that relates to the Corresponding SAR. No SARs shall be terminated to the
extent that written provision is made for their assumption, continuance or substitution by the Company or a successor employer or
its parent or subsidiary in connection with the Change in Control. If the Committee so provides in an applicable Agreement, a
Participant’s outstanding SARs shall be fully exercisable on and after a Control Change Date or immediately before the date
the SARs will be terminated in connection with the Change in Control, as described above, provided the Participant has been
continuously employed by or has continuously provided services to the Company or an Affiliate as of such time. 

7.07.    Employee Status  

        If the terms of any SAR
provide that it may be exercised only during employment or continued service or within a specified period of time after
termination of employment or continued service, the Committee may decide to what extent leaves of absence for governmental or
military service, illness, temporary disability or other reasons shall not be deemed interruptions of continuous employment or
service. 

7.08.    Settlement  

        At the Committee’s
discretion, the amount payable as a result of the exercise of an SAR may be settled in cash, shares of Common Stock, or a
combination of cash and Common Stock. No fractional share will be deliverable upon the exercise of an SAR but a cash payment will
be made in lieu thereof. 

7.09.    Stockholder Rights  

        No Participant shall, as a
result of receiving an SAR, have any rights as a stockholder of the Company or any Affiliate until the date that the SAR is
exercised and then only to the extent that the SAR is settled by the issuance of Common Stock. 

-18- 

ARTICLE VIII

STOCK AWARDS  

8.01.    Award  

        In accordance with the
provisions of Article IV, the Committee will designate each individual or entity to whom a Stock Award is to be granted and
will specify the number of shares of Common Stock covered by such grant. 

8.02.    Vesting  

        The Committee, on the date of
grant, may prescribe that a Participant’s rights in the Stock Award shall be forfeitable and nontransferable for a period of
time and subject to such conditions as may be set forth in the Agreement. By way of example and not of limitation, the Committee
may prescribe that a Participant’s rights in a Stock Award shall be forfeitable and nontransferable subject to (a) the
attainment of objectives stated with reference to the Company’s, an Affiliate’s or a business unit’s attainment of
objectives stated with respect to performance criteria listed in Section 8.03, (b) the Participant’s completion of a
specified period of employment or service with the Company or an Affiliate, (c) the Participant’s death, disability or
retirement or (d) satisfaction of a combination of any of the foregoing factors. To the extent the Participant’s rights in a
Stock Award are forfeitable and nontransferable for a period of time, the Committee on the date of grant shall determine the
maximum period over which the rights may become nonforfeitable and transferable, except that such period shall not exceed ten
years. If an applicable Agreement does not provide for when a Participant’s rights in a Stock Award will become
nonforfeitable and transferable, a Participant’s rights in a Stock Award will become nonforfeitable and transferable with
respect to one-fourth of the shares of Common Stock covered by the grant on each of the first, second, third and fourth
anniversaries of the date of grant, provided the Participant has been continuously employed by or has continuously provided
services to the Company or an Affiliate as of each such date. Additionally, if the Committee so provides in an applicable
Agreement, an outstanding Stock Award shall become nonforfeitable and transferable with respect to one hundred percent (100%) of
the shares of Common Stock covered by the grant upon (i) involuntary termination of the Participant’s employment or service
by the Company or an Affiliate other than for Cause, (ii) voluntary termination of a Participant’s employment or service with
the Company or an Affiliate by the Participant for Good Reason, (iii) the Participant’s death while still employed by or
providing services to the Company or an Affiliate or (iv) the Participant’s Disability while still employed by or providing
services to the Company or an Affiliate. 

8.03.    Performance Objectives  

        In accordance with Section
8.02, the Committee may prescribe in an applicable Agreement that Stock Awards will become nonforfeitable and transferable based
on objectives stated with respect to the Company’s, an Affiliate’s or a business unit’s (a) total stockholder
return; (b) total stockholder return as compared to total return (on a comparable basis) of a publicly available index; (c) net
income; (d) gross, operating or net earnings before or after taxes; (e) funds from operations; (f) earnings before interest
expense, taxes, depreciation and 

-19- 

amortization; (g) operating margin; (h) earnings per share; (i) return on
equity, capital, assets, net assets, sales or investment; (j) working capital; (k) ratio of debt to stockholders equity;
(l) revenue; (m) cash flow or cash flow per share; (n) book value per share; (o) earnings growth; (p) sales growth; (q)
customer growth; (r) Fair Market Value of the Company or any Affiliate or shares of Common Stock; (s) share price; (t) market
share; (u) economic value added; (v) market value added; (w) productivity; (x) level of expenses; (y) quality; (z) safety; (aa)
customer satisfaction or (bb) peer group comparisons of any of the aforementioned performance objectives. If the Committee, on the
date of grant, prescribes that a Stock Award shall become nonforfeitable and transferable only upon the attainment of any of the
above performance objectives, the shares of Common Stock subject to such Stock Award shall become nonforfeitable and transferable
only to the extent that the Committee certifies in writing that such objectives have been achieved. 

8.04.    Employee Status  

        In the event that the terms
of any Stock Award provide that shares shall become nonforfeitable and transferable thereunder only after completion of a
specified period of employment or continuous service, the Committee may decide in each case to what extent leaves of absence for
governmental or military service, illness, temporary disability, or other reasons shall not be deemed interruptions of continuous
employment or service. 

8.05.    Change in Control  

        Notwithstanding any provision
of any Agreement, in the event of or in anticipation of a Change in Control, the Committee in its discretion may terminate before
or on the Control Change Date outstanding Stock Awards previously granted under the Plan that are not then nonforfeitable and
transferable without any payment to the holder of the Stock Awards. The Committee in its discretion may take the action described
in this Section 8.05 contingent on the consummation of the Change in Control and with respect to some or all outstanding Stock
Awards or on a Stock Award-by-Stock Award basis, which actions need not be uniform with respect to all outstanding Stock Awards.
The preceding sentences to the contrary notwithstanding, the Stock Awards shall not be terminated to the extent that written
provision is made for their assumption, continuance or substitution by the Company or a successor employer or its parent or
subsidiary in connection with the Change in Control. If the Committee so provides in an applicable Agreement, a Participant’s
outstanding Stock Awards shall become nonforfeitable and transferable on and after a Control Change Date or immediately before the
date the Stock Awards would otherwise be terminated in connection with the Change in Control, as described above, provided the
Participant has been continuously employed by or has continuously provided services to the Company or an Affiliate as of such
time. 

8.06.    Stockholder Rights  

        Prior to their forfeiture (in
accordance with the applicable Agreement and while the shares of Common Stock granted pursuant to the Stock Award may be forfeited
and are nontransferable), a Participant will have all rights of a stockholder with respect to a Stock Award, including the right
to receive dividends and vote the shares; provided, however, that 

-20- 

during such period (i) a Participant may not sell, transfer, pledge,
exchange, hypothecate, or otherwise dispose of shares granted pursuant to a Stock Award, (ii) the Company shall retain custody of
the certificates evidencing shares granted pursuant to a Stock Award, and (iii) the Participant will deliver to the Company a
stock power, endorsed in blank, with respect to each Stock Award. The limitations set forth in the preceding sentence shall not
apply after the shares granted under the Stock Award are transferable and are no longer forfeitable. 

-21- 

ARTICLE IX

PERFORMANCE SHARE AWARDS  

9.01.    Grant  

        In accordance with the
provisions of Article IV, the Committee will designate each individual or entity to whom a grant of Performance Shares is to
be made and will specify the number of shares covered by such grant. 

9.02.    Earning the Award  

        The Committee, on the date of
grant of the Performance Shares, shall prescribe that the Performance Shares will be earned and become payable subject to such
conditions as are set forth in the Agreement. By way of example and not of limitation, the Committee may prescribe that the
Performance Shares will be earned and become payable upon (a) the satisfaction of performance objectives as described below, (b)
the Participant’s completion of a specified period of employment or service with the Company or an Affiliate, (c) the
Participant’s death, disability or retirement or (d) satisfaction of a combination of any of the foregoing factors. The
performance objectives may be stated with respect to the Company’s, an Affiliate’s or a business unit’s (a) total
stockholder return; (b) total stockholder return as compared to total return (on a comparable basis) of a publicly available
index; (c) net income; (d) gross, operating or net earnings before or after taxes; (e) funds from operations; (f) earnings before
interest expense, taxes, depreciation and amortization; (g) operating margin; (h) earnings per share; (i) return on equity,
capital, assets, net assets, sales or investment; (j) working capital; (k) ratio of debt to stockholders equity; (l) revenue; (m)
cash flow or cash flow per share; (n) book value per share; (o) earnings growth; (p) sales growth; (q) customer growth; (r) Fair
Market Value of the Company or any Affiliate or shares of Common Stock; (s) share price; (t) market share; (u) economic value
added; (v) market value added; (w) productivity; (x) level of expenses; (y) quality; (z) safety; (aa) customer satisfaction
or (bb) peer group comparisons of any of the aforementioned performance objectives. If the Committee, on the date of grant,
prescribes that Performance Shares will be earned and payable only upon the attainment of such performance objectives, no
Performance Shares will be considered earned and no payments will be made with respect to such Performance Shares unless, and then
only to the extent that, the Committee certifies in writing that such objectives have been achieved. If an applicable Agreement
does not provide for when a Participant’s rights in Performance Shares will be earned and become payable, a
Participant’s rights in Performance Shares will be earned and become payable with respect to one-fourth of the shares of
Common Stock covered by the grant on each of the first, second, third and fourth anniversaries of the date of grant, provided the
Participant has been continuously employed by or has continuously provided services to the Company or an Affiliate as of each such
date. Additionally, if the Committee so provides in an applicable Agreement, outstanding Performance Shares shall be earned and
become payable with respect to one hundred percent (100%) of the shares of Common Stock covered by the grant upon (i) involuntary
termination of the Participant’s employment or service by the Company or an Affiliate other than for Cause, (ii) voluntary
termination of a Participant’s employment or service with the Company or an Affiliate by the Participant for Good Reason,
(iii) the Participant’s death while still 

-22- 

employed by or providing services to the Company or an Affiliate or (iv) the
Participant’s Disability while still employed by or providing services to the Company or an Affiliate. 

9.03.    Maximum Performance Share Award Period  

        The Committee, on the date of
grant, shall determine the maximum period over which Performance Share Awards may be earned, except that such period shall not
exceed ten years. 

9.04.    Payment  

        In the discretion of the
Committee, the amount payable when an award of Performance Shares is earned may be settled in cash, by the issuance of shares of
Common Stock, or a combination thereof. A fractional share of Common Stock shall not be deliverable when an award of Performance
Shares is earned, but a cash payment will be made in lieu thereof. 

9.05.    Stockholder Rights  

        No Participant shall, as a
result of receiving a grant of Performance Shares, have any rights as a stockholder until and then only to the extent that the
Performance Shares are earned and settled in shares of Common Stock. After Performance Shares are earned and settled in shares, a
Participant will have all the rights of a stockholder with respect to such shares, including the right to receive dividends and
vote the shares. 

9.06.    Nontransferability  

        Except as provided in
Section 9.07 Performance Shares granted under this Plan shall be nontransferable except by will or by the laws of descent and
distribution. No right or interest of a Participant in any Performance Shares shall be liable for, or subject to, any lien,
obligation, or liability of such Participant. 

9.07.    Transferable Performance Shares  

        Section 9.06 to the
contrary notwithstanding, if the Agreement so provides, an award of Performance Shares may be transferred by a Participant to the
Participant’s children, grandchildren, spouse, one or more trusts for the benefit of such family members or a partnership in
which such family members are the only partners, on such terms and conditions as appropriate so that such transferees are included
in the class of transferees who may rely on a Form S-8 Registration Statement under the Securities Act of 1933 to sell shares
received pursuant to Awards granted under the Plan. The holder of Performance Shares transferred pursuant to this Section shall be
bound by the same terms and conditions that governed the Performance Shares during the period that they were held by the
Participant; provided, however that such transferee may not transfer Performance Shares except by will or the laws of descent and
distribution. 

9.08.    Employee Status  

        In the event that the terms
of any Performance Share award provide that no payment will be made unless the Participant completes a stated period of employment
or continued service, the 

-23- 

Committee may decide to what extent leaves of absence for government or
military service, illness, temporary disability, or other reasons shall not be deemed interruptions of continuous employment or
service. 

9.09.    Change in Control  

        Notwithstanding any provision
of any Agreement, in the event of or in anticipation of a Change in Control, the Committee in its discretion may terminate before
or on the Control Change Date some or all outstanding Performance Shares previously granted under the Plan that are not then
earned and payable without any payment to the holder of the Performance Shares. The Committee in its discretion may take the
action described in this Section 9.09 contingent on consummation of the Change in Control and with respect to some or all
outstanding Performance Shares or on a Performance Share-by-Performance Share basis, which actions need not be uniform with
respect to all outstanding Performance Shares. The Performance Shares shall not be terminated to the extent that written provision
is made for their assumption, continuance or substitution by the Company or a successor employer or its parent or subsidiary in
connection with the Change in Control. If the Committee so provides in an applicable Agreement, a Participant’s outstanding
Performance Shares shall be deemed earned (and any shares of Common Stock to be paid in settlement of such Performance Shares
shall be nonforfeitable and transferable) as of a Control Change Date or immediately before the date the Performance Shares would
otherwise be terminated in connection with the Change in Control, as described above, provided the Participant has been
continuously employed by or has continuously provided services to the Company or an Affiliate as of such time. 

-24- 

ARTICLE X

INCENTIVE AWARDS  

10.01.    Grant  

        The Committee shall designate
Participants to whom Incentive Awards are to be granted. All Incentive Awards shall be finally determined exclusively by the
Committee under the procedures established by the Committee; provided, however, that no Participant may receive an Incentive Award
payment in any calendar year that exceeds $750,000. 

10.02.    Terms and Conditions  

        The Committee, on the date of
grant of an Incentive Award, shall specify in the applicable Agreement the terms and conditions which govern the grant. By way of
example and not of limitation, the Committee may prescribe that the Incentive Award shall be earned and payable upon (a) the
satisfaction of performance objectives as described below, (b) the Participant’s completion of a specified period of
employment or service with the Company or an Affiliate, (c) the Participant’s death, disability or retirement or (d)
satisfaction of a combination of any of the foregoing factors. The performance objectives may be stated with respect to the
Company’s, an Affiliate’s or a business unit’s (a) total stockholder return; (b) total stockholder return as
compared to total return (on a comparable basis) of a publicly available index; (c) net income; (d) gross, operating or net
earnings before or after taxes; (e) funds from operations; (f) earnings before interest expense, taxes, depreciation and
amortization; (g) operating margin; (h) earnings per share; (i) return on equity, capital, assets, net assets, sales or
investment; (j) working capital; (k) ratio of debt to stockholders equity; (l) revenue; (m) cash flow or cash flow per share;
(n) book value per share; (o) earnings growth; (p) sales growth; (q) customer growth; (r) Fair Market Value of the Company or any
Affiliate or shares of Common Stock; (s) share price; (t) market share; (u) economic value added; (v) market value added;
(w) productivity; (x) level of expenses; (y) quality; (z) safety; (aa) customer satisfaction or (bb) peer group
comparisons of any of the aforementioned performance objectives. If the Committee, on the date of grant, prescribes that the
Incentive Awards will be earned and payable only upon the attainment of such performance objectives, no Incentive Awards will be
considered earned and no payments will be made with respect to such Incentive Awards unless, and then only to the extent that, the
Committee certifies in writing that such objectives have been achieved. If an applicable Agreement does not provide for when a
Participant’s rights in an Incentive Award will become earned and payable, a Participant’s rights in an Incentive Award
will be earned and payable with respect to one-fourth of the value of the Incentive Award on each of the first, second, third and
fourth anniversaries of the date of grant, provided the Participant has been continuously employed by or has continuously provided
services to the Company or an Affiliate as of each such date. Additionally, if the Committee so provides in an applicable
Agreement, an outstanding Incentive Award shall be earned and payable with respect to one hundred percent (100%) of the value of
the Incentive Award that was not previously earned and payable upon (i) involuntary termination of the Participant’s
employment or service by the Company or an Affiliate other than for Cause, (ii) voluntary termination of a Participant’s
employment or service with the Company or an Affiliate by the Participant for Good Reason, 

-25- 

(iii) the Participant’s death while still employed by or providing
services to the Company or an Affiliate or (iv) the Participant’s Disability while still employed by or providing services to
the Company or an Affiliate. 

10.03.    Maximum Incentive Award Period  

        The Committee, at the time an
Incentive Award is made, shall determine the maximum period over which the Incentive Award may be earned, except that such period
shall not exceed ten years. 

10.04.    Nontransferability  

        Except as provided in Section
10.05, Incentive Awards granted under this Plan shall be nontransferable except by will or by the laws of descent and
distribution. No right or interest of a Participant in an Incentive Award shall be liable for, or subject to, any lien,
obligation, or liability of such Participant. 

10.05.    Transferable Incentive Awards  

        Section 10.04 to the contrary
notwithstanding, if so provided in an Agreement, an Incentive Award may be transferred by a Participant to the Participant’s
children, grandchildren, spouse, one or more trusts for the benefit of such family members or to a partnership in which such
family members are the only partners, on such terms and conditions as appropriate so that such transferees are included in the
class of transferees who may rely on a Form S-8 Registration Statement under the Securities Act of 1933 to sell shares received
pursuant to Awards granted under the Plan. The holder of an Incentive Award transferred pursuant to this Section shall be bound by
the same terms and conditions that governed the Incentive Award during the period that it was held by the Participant; provided,
however, that such transferee may not transfer the Incentive Award except by will or the laws of descent and distribution.

10.06.    Employee Status  

        If the terms of an Incentive
Award provide that a payment will be made thereunder only if the Participant completes a stated period of employment or continuous
service, the Committee may decide to what extent leaves of absence for governmental or military service, illness, temporary
disability or other reasons shall not be deemed interruptions of continuous employment or service. 

10.07.    Change in Control  

        Notwithstanding any provision
of any Agreement, in the event of or in anticipation of a Change in Control, the Committee in its discretion may terminate before
or on the Control Change Date some or all outstanding Incentive Awards previously granted under the Plan that are not then earned
and payable without any payment to the holder of the Incentive Award. The Committee in its discretion may take the action
described in this Section contingent on consummation of the Change in Control and with respect to some or all outstanding
Incentive 

-26- 

Awards or on an Incentive Award-by-Incentive Award basis, which actions need
not be uniform with respect to all outstanding Incentive Awards. The Incentive Awards shall not be terminated to the extent that
written provision is made for their assumption, continuance or substitution by the Company or a successor employer or its parent
or subsidiary in connection with the Change in Control. If the Committee so provides in an applicable Agreement, a
Participant’s outstanding Incentive Awards shall be deemed earned (and shares of Common Stock to be paid in settlement of
such Incentive Awards shall be nonforfeitable and transferable) as of a Control Change Date or immediately before the date the
Incentive Awards would otherwise be terminated in connection with the Change in Control, as described above, provided the
Participant has been continuously employed by or has continuously provided services to the Company or an Affiliate as of such
time. 

10.08.    Stockholder Rights  

        No Participant shall, as a
result of receiving an Incentive Award, have any rights as a stockholder of the Company or any Affiliate on account of such
Incentive Award, unless and until the Incentive Award is earned and shares of Common Stock paid in settlement thereof. After an
Incentive Award is earned and settled in shares, a Participant will have all the rights of a stockholder with respect to such
shares, including the right to receive dividends and vote the shares. 

-27- 

ARTICLE XI

ADJUSTMENT UPON CHANGE IN COMMON STOCK  

        The maximum number of shares
that may be issued pursuant to Awards, the terms of outstanding Awards, and the per individual limitations on the number of shares
of Common Stock that may be issued pursuant to for which Awards shall be adjusted as the Board shall determine to be equitably
required in the event that (i) the Company (a) effects one or more stock dividends, stock split-ups, subdivisions or
consolidations of shares or (b) engages in a transaction described under Section 424 of the Code or (ii) there occurs any
other event which, in the judgment of the Board, necessitates such action. In addition, the Committee may make such other
adjustments to the terms of any Awards to the extent equitable and necessary to prevent an enlargement or dilution of the
Participant’s rights thereunder as a result of any such event or similar transaction. Any determination made under this
Article XI by the Board shall be final and conclusive. 

        The issuance by the Company
of stock of any class, or securities convertible into stock of any class, for cash or property, or for labor or services, either
upon direct sale or upon the exercise of rights or warrants to subscribe therefor, or upon conversion of stock or obligations of
the Company convertible into such stock or other securities, shall not affect, and no adjustment by reason thereof shall be made
with respect to, the maximum number of shares that may be issued pursuant to Awards may be granted, the per individual limitations
on the number of shares that may be issued pursuant to Awards, or the terms of outstanding Awards. 

        The Committee may grant
Awards in substitution for performance shares, incentive awards, stock awards, stock options, stock appreciation rights, or
similar awards held by an individual who becomes an employee of the Company or an Affiliate in connection with a transaction
described in the first paragraph of this Article XI. Notwithstanding any provision of the Plan (other than the limitation of
Section 5.02), the terms of such substituted Awards shall be as the Committee, in its discretion, determines is appropriate.

-28- 

ARTICLE XII

COMPLIANCE WITH LAW AND APPROVAL OF REGULATORY BODIES  

12.01.    Compliance  

        No Option or SAR shall be
exercisable, no shares of Common Stock shall be issued, no certificates for shares of Common Stock shall be delivered, and no
payment shall be made under this Plan except in compliance with all applicable federal and state laws and regulations (including,
without limitation, withholding tax requirements), any listing agreement to which the Company is a party, and the rules of all
domestic stock exchanges on which the Company’s shares may be listed. The Company shall have the right to rely on an opinion
of its counsel as to such compliance. Any stock certificate evidencing shares of Common Stock issued pursuant to an Award may bear
such legends and statements as the Committee may deem advisable to assure compliance with federal and state laws and regulations.
No Option or SAR shall be exercisable, no Stock Award or Performance Share shall be granted, no shares of Common Stock shall be
issued, no certificate for shares of Common Stock shall be delivered, and no payment shall be made under this Plan until the
Company has obtained such consent or approval as the Committee may deem advisable from regulatory bodies having jurisdiction over
such matters. 

12.02.    Postponement of Exercise or Payment  

        The Committee may postpone
any grant, exercise, vesting or payment of an Award for such time as the Committee in its sole discretion may deem necessary in
order to permit the Company (i) to effect, amend or maintain any necessary registration of the Plan or the shares of Common Stock
issuable pursuant to the Award under the securities laws; (ii) to permit any action to be taken in order to (A) list such shares
of Common Stock or other shares of stock of the Company on a stock exchange if shares of Common Stock or other shares of stock of
the Company are not then listed on such exchange or (B) comply with restrictions or regulations incident to the maintenance of a
public market for its shares of Common Stock or other shares of stock of the Company, including any rules or regulations of any
stock exchange on which the shares of Common Stock or other shares of stock of the Company are listed; (iii) to determine that
such shares of Common Stock in the Plan are exempt from such registration or that no action of the kind referred to in (ii)(B)
above needs to be taken; (iv) to comply with any other applicable law, including without limitation, securities laws; (v) during
any such time the Company or any Affiliate is prohibited from doing any of such acts under applicable law, including without
limitation, during the course of an investigation of the Company or any Affiliate, or under any contract, loan agreement or
covenant or other agreement to which the Company or any Affiliate is a party or (vi) to otherwise comply with any prohibition on
such acts or payments during any applicable blackout period; and the Company shall not be obligated by virtue of any terms and
conditions of any Agreement or any provision of the Plan to recognize the grant, exercise, vesting or payment of an Award or to
grant, sell or issue shares of Common Stock or make any such payments in violation of the securities laws or the laws of any
government having jurisdiction thereof or any of the provisions hereof. Any such postponement shall not extend the term of the
Award and neither the Company nor its directors and officers nor the Committee shall have any obligation or liability to any
Participant or to any other person with 

-29- 

respect to shares of Common Stock or payments as to which the Award shall
lapse because of such postponement. 

12.03.    Forfeiture of Payment  

        A Participant shall be
required to forfeit any and all rights under Awards or to reimburse the Company for any payment under any Award (with interest as
necessary to avoid imputed interest or original issue discount under the Code or as otherwise required by applicable law) to the
extent applicable law requires such forfeiture or reimbursement. 

-30- 

ARTICLE XIII

GENERAL PROVISIONS  

13.01.    Effect on Employment and Service  

        Neither the adoption of this
Plan, its operation, nor any documents describing or referring to this Plan (or any part thereof), shall confer upon any
individual or entity any right to continue in the employ or service of the Company or an Affiliate or in any way affect any right
and power of the Company or an Affiliate to terminate the employment or service of any individual or entity at any time with or
without assigning a reason therefor. 

13.02.    Unfunded Plan  

        This Plan, insofar as it
provides for Awards, shall be unfunded, and the Company shall not be required to segregate any assets that may at any time be
represented by Awards under this Plan. Any liability of the Company to any person with respect to any Award under this Plan shall
be based solely upon any contractual obligations that may be created pursuant to this Plan. No such obligation of the Company
shall be deemed to be secured by any pledge of, or other encumbrance on, any property of the Company. 

13.03.    Rules of Construction  

        Headings are given to the
articles and sections of this Plan solely as a convenience to facilitate reference. The reference to any statute, regulation, or
other provision of law shall be construed to refer to any amendment to or successor of such provision of law. 

13.04.    Tax Withholding and Reporting  

        Unless an Agreement provides
otherwise, each Participant shall be responsible for satisfying in cash or cash equivalent acceptable to the Committee any income
and employment (including without limitation Social Security and Medicare) tax withholding obligations attributable to
participation in the Plan and the grant, exercise, vesting or payment of Awards granted thereunder. In accordance with procedures
that the Committee establishes, the Committee, to the extent applicable law permits, may allow a Participant to pay such amounts
(i) in cash, (ii) by certified check, (iii) by tendering shares of Common Stock (which, if acquired from the Company, have
been held by the Participant for at least six months) and which do not exceed the Company’s minimum statutory withholding
obligation, (iv) by a broker-assisted cashless exercise or (v) by any combination of the aforementioned methods of payment. The
Company shall comply with all such reporting and other requirements relating to the administration of this Plan and the grant,
exercise, vesting or payment of any Award hereunder as applicable law requires. 

13.05.    Reservation of Shares  

        The Company, during the term
of this Plan, shall at all times reserve and keep available such number of shares of Common Stock as shall be sufficient to
satisfy the requirements of the 

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Plan. Additionally, the Company, during the term of this Plan, shall use its
best efforts to seek to obtain from appropriate regulatory agencies any requisite authorizations needed in order to issue and to
sell such number of shares of Common Stock as shall be sufficient to satisfy the requirements of the Plan. However, the inability
of the Company to obtain from any such regulatory agency the requisite authorizations the Company’s counsel deems to be
necessary for the lawful issuance and sale of any shares of Common Stock hereunder, or the inability of the Company to confirm to
its satisfaction that any issuance and sale of any shares of Common Stock hereunder will meet applicable legal requirements, shall
relieve the Company of any liability in respect to the failure to issue or to sell such shares of Common Stock as to which such
requisite authority shall not have been obtained. 

13.06.    Governing Law  

        This Plan and all Awards
granted hereunder shall be governed by the laws of the Commonwealth of Virginia, except to the extent federal law applies.

13.07.    Other Actions  

        Nothing in the Plan shall be
construed to limit the authority of the Company to exercise its corporate rights and powers, including, by way of illustration and
not by way of limitation, the right to grant options, stock appreciation rights, stock awards, incentive awards or performance
shares for proper corporate purposes otherwise than under the Plan to any employee or to any other person, firm, corporation,
association or other entity, or to grant options, stock appreciation rights, stock awards, incentive awards or performance shares
to, or assume such awards of any person in connection with, the acquisition, purchase, lease, merger, consolidation,
reorganization or otherwise, of all or any part of the business and assets of any person, firm, corporation, association or other
entity. 

13.08.    Other Conditions  

        The Committee, in its
discretion, may, as a condition to the grant, exercise, payment or settlement of an Award, require the Participant on or before
the date of grant, exercise, payment or settlement of the Award to enter into (i) a covenant not to compete (including a
confidentiality, non-solicitation, non-competition or other similar agreement) with the Company or any Affiliate, which may become
effective on the date of termination of employment or service of the Participant with the Company or any Affiliate or any other
date the Committee may specify and shall contain such terms and conditions as the Committee shall otherwise specify, (ii) an
agreement to cancel any other employment agreement, service agreement, fringe benefit or compensation arrangement in effect
between the Company or any Subsidiary and such Participant and/or (iii) a shareholders’ agreement with respect to shares of
Common Stock to be issued pursuant to the Award. If the Participant shall fail to enter into any such agreement at the
Committee’s request, then no Award shall be granted, exercised, paid or settled and the number of shares of Common Stock that
would have been subject to such Award, if any, shall be added to the remaining shares of Common Stock available under the Plan.

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13.09.    Forfeiture Provisions  

        Notwithstanding any other
provisions of the Plan or any Agreement, all rights to any Award that a Participant has will be immediately discontinued and
forfeited, and the Company shall not have any further obligation hereunder to the Participant with respect to any Award and the
Award will not be exercisable (whether or not previously exercisable) or become vested or payable on and after the time the
Participant is discharged from employment or service with the Company or any Affiliate for Cause. 

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ARTICLE XIV

AMENDMENT  

        The Board may amend or
terminate this Plan at any time; provided, however, that no amendment may adversely impair the rights of a Participant with
respect to outstanding Awards without the Participant’s consent. In addition, an amendment will be contingent on approval of
the Company’s stockholders, to the extent required by law or by the rules of any stock exchange on which the Company’s
securities are traded or if the amendment would (i) increase the benefits accruing to Participants under the Plan, including
without limitation, any amendment to the Plan or any Agreement to permit a repricing or a decrease in the exercise price of any
outstanding Options, (ii) increase the aggregate number of shares of Common Stock that may be issued under the Plan, (iii) modify
the requirements as to eligibility for participation in the Plan or, (iv) after the transition period prescribed by the
regulations under Code Section 162(m), change the performance objectives set forth in Sections 8.03, 9.02 or 10.02. 

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ARTICLE XV

DURATION OF PLAN  

        No Award may be granted under
this Plan after December 14, 2014. Awards granted before that date shall remain valid in accordance with their terms. 

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ARTICLE XVI

EFFECTIVE DATE OF PLAN  

        Awards may be granted under
this Plan upon its adoption by the Board; provided that, this Plan shall not be effective unless approved by unanimous consent of
the Company’s stockholders or by a majority of the votes cast by the Company’s stockholders, voting either in person or
by proxy, at a duly held stockholders’ meeting at which a stockholder quorum is present, before December 14, 2004.

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