Document:

Exhibit 10.34.4

 

THE FIRST MARBLEHEAD CORPORATION

 

Restricted
Stock Unit Agreement

Granted Under 2003 Stock Incentive Plan

 

1.                                       Grant of Award.

 

This Agreement evidences the grant by The First
Marblehead Corporation, a Delaware corporation (the “Company”), on July 11,
2005 (the “Grant Date”) to Peter B. Tarr (the “Participant”) of 146,584
restricted stock units of the Company (individually, an “RSU” and collectively,
the “RSUs”).  Each RSU represents the
right to receive one share of the common stock, $0.01 par value per share, of
the Company (“Common Stock”) as provided in this Agreement.  The shares of Common Stock that are issuable
upon vesting of the RSUs are referred to in this Agreement as “Shares.”

 

2.                                       Vesting; Forfeiture.

 

(a)                                  This
award shall vest as to twenty percent (20%) of the original number of RSUs on
the first anniversary of the Grant Date and as to an additional twenty percent
(20%) of the original number of RSUs on each succeeding anniversary of the
Grant Date until the fifth anniversary of the Grant Date. 

 

(b)                                 In
the event that the Participant’s employment with the Company is terminated by
reason of death or disability, this award shall be fully vested.  For this purpose, “disability” shall mean the
inability of the Participant, due to a medical reason, to carry out his duties
as an employee of the Company for a period of six consecutive months.  In addition, the Participant is party to a
letter agreement with the Company relating to the Participant’s employment with
the Company (the “Offer Letter”).  If the
Participant’s employment with the Company is terminated by the Company for a
reason other than “Cause” (as defined in the Offer Letter), then the number of
RSUs which shall be vested shall be determined in accordance with the Offer
Letter.

 

(c)                                  For
purposes of this Agreement, employment with the Company shall include
employment with a parent or subsidiary of the Company.

 

(d)                                 The
Participant agrees not to engage in a Competitive Action (as defined below)
from the date hereof through the first anniversary of the date of termination
of the Participant’s employment with the Company.  If on or prior to a Settlement Date (as
defined below), the Participant engages in a Competitive Action or enters into,
or has entered into, an agreement (written, oral or otherwise) to engage in a
Competitive Action, all of the RSUs and all Shares issuable upon vesting of all
RSU’s subject to this Agreement shall be immediately forfeited, and the
Participant shall have no further rights with respect to such RSUs or
Shares.  In the event that the
Participant engages in a Competitive Action or enters into, or has entered
into, an agreement (written, oral or otherwise) to engage in a Competitive
Action after the last Settlement Date but on or prior to the first anniversary
of the Participant’s termination of employment with the Company, the
Participant shall pay to the Company, upon demand by the Company, an amount
equal to (i) the value, as of each Settlement Date, of the number of
Shares

 

 

delivered to the
Participant represented by RSUs on such Settlement Date and (ii) the value
of all dividends, if any, paid to the Participant in respect of the Shares
delivered to the Participant on such Settlement Date.  The Participant may satisfy the payment
obligation to the Company of the portion due under (i) above by returning
the Shares delivered to the Participant on all Settlement Dates, provided that
any amounts due under (ii) above must be remitted to the Company in
addition to the return of the Shares. 
The Participant acknowledges that the restriction on engaging in a
Competitive Action, in view of the nature of the business in which the Company
is engaged, is reasonable in scope (as to both the temporal and geographical
limits) and necessary in order to protect the legitimate business interests of
the Company, and that any violation thereof would result in irreparable
injuries to the Company.  The Participant
acknowledges further that the amounts required to be paid to the Company
pursuant to this provision are reasonable and are not liquidated damages nor
shall they be characterized as such and that the payment of such amounts shall
not preclude the Company from seeking any further remedies at law or in equity.

 

(e)                                  For
purposes of this Agreement, the Participant will be deemed to engage in a “Competitive
Action” if, either directly or indirectly, and whether as an employee,
consultant, independent contractor, partner, joint venturer or otherwise, the
Participant (i) engages in or directs any business activities, in any geographical
area where the Company or any subsidiary or parent of the Company is engaged in
business or outside of any such geographical area, in either case, which are
competitive with any business activities conducted by the Company or any
subsidiary or parent of the Company in such geographical area, (ii) on
behalf of any person or entity engaged in business activities competitive with
the business activities of the Company or any subsidiary or parent of the
Company, solicits or induces, or in any manner attempts to solicit or induce,
any person employed by, or as an agent of, the Company or any subsidiary or
parent of the Company to terminate such person’s employment or agency
relationship, as the case may be, with the Company or any subsidiary or parent
of the Company, (iii) diverts, or attempts to divert, any person, concern
or entity from doing business with the Company or any subsidiary or parent of
the Company or attempts to induce any such person, concern or entity to cease
being a customer of the Company or any subsidiary or parent of the Company or (iv) makes
use of, or attempts to make use of, the property or proprietary information of
the Company or any subsidiary or parent of the Company, other than in the
course of the performance of services to the Company or any subsidiary or
parent of the Company or at the direction thereof.  The determination as to whether the
Participant has engaged in a Competitive Action (as defined herein) shall be
made by the Compensation Committee of the Board of Directors of the Company
(the “Committee”) in its sole and absolute discretion.  The Committee’s exercise or nonexercise of
such discretion with respect to any particular event or occurrence by or with
respect to the Participant or any other recipient of stock options, RSUs or
other derivative securities of the Company shall not in any way reduce or
eliminate the authority of the Committee to (i) determine that any event
or occurrence by or with respect to the Participant constitutes engaging in a
Competitive Action or (ii) determine the related Competitive Action date.

 

3.                                       Distribution of Shares.

 

(a)                                  The
Company will distribute to the Participant (or to the Participant’s estate in
the event that his or her death occurs after a vesting date but before
distribution of the corresponding Shares), as soon as administratively
practicable after each vesting date (each such

 

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date of distribution is
hereinafter referred to as a “Settlement Date”), the Shares of Common Stock
represented by RSUs that vested on such vesting date.

 

(b)                                 The
Company shall not be obligated to issue to the Participant the Shares upon the
vesting of any RSU (or otherwise) unless the issuance and delivery of such
Shares shall comply with all relevant provisions of law and other legal
requirements including, without limitation, any applicable federal or state
securities laws and the requirements of any stock exchange upon which shares of
Common Stock may then be listed.

 

4.                                       Restrictions on Transfer.

 

The Participant shall not sell, assign, transfer,
pledge, hypothecate or otherwise dispose of, by operation of law or otherwise
(collectively “transfer”) any RSUs, or any interest therein, except by will or
the laws of descent and distribution.

 

5.                                       Dividend and Other Shareholder Rights.

 

Except as set forth in the Plan, neither the
Participant nor any person claiming under or through the Participant shall be,
or have any rights or privileges of, a stockholder of the Company in respect of
the Shares issuable pursuant to the RSUs granted hereunder until the Shares
have been delivered to the Participant.

 

6.                                       Provisions of the Plan; Reorganization Event.

 

(a)                                  This
Agreement is subject to the provisions of the Plan, a copy of which is
furnished to the Participant with this Agreement.

 

(b)                                 Upon
the occurrence of a Reorganization Event (as defined in the Plan), each RSU
(whether vested or unvested) shall become the right to receive the cash,
securities or other property that a Share was converted into or exchanged for
pursuant to such Reorganization Event. 
If, in connection with a Reorganization Event, a portion of the cash,
securities and/or other property received upon the conversion or exchange of
the Shares is to be placed into escrow to secure indemnification or similar
obligations, the mix between the vested and unvested portion of such cash,
securities and/or other property that is placed into escrow shall be the same
as the mix between the vested and unvested portion of such cash, securities
and/or other property that is not subject to escrow.  Notwithstanding the foregoing provisions,
this award shall be fully vested if, on or prior to the second anniversary of
the date of the consummation of the Reorganization Event, the Participant’s
employment with the Company or the Company’s successor is terminated for Good
Reason (as defined below) by the Participant or is terminated without Cause (as
defined below) by the Company or the Company’s successor. 

 

(c)                                  For
purposes of this Section 6, (i) “Good Reason” shall mean any
significant diminution in the Participant’s title, authority, or
responsibilities from and after such Reorganization Event or any reduction in
the annual cash compensation payable to the Participant from and after such
Reorganization Event or the relocation of the place of business at which the
Participant is principally located to a location that is greater than 50 miles
from its location immediately prior to such Reorganization Event and (ii) “Cause”
shall mean any (i) willful failure by the Participant, which failure is
not cured within 30 days of written notice to

 

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the Participant from the Company, to perform his or her material
responsibilities to the Company or (ii)  willful misconduct by the
Participant which affects the business reputation of the Company. 

 

(d)                                 Notwithstanding
any other provision in this agreement, the provisions of the Offer Letter,
including any applicable definitions, and not any inconsistent provisions of
this Section 6, shall apply in the event of a Reorganization Event.

 

7.                                       Withholding Taxes; Section 83(b) Election.

 

(a)                                  No
Shares will be delivered pursuant to the vesting of an RSU unless and until the
Participant pays to the Company, or makes provision satisfactory to the Company
for payment of, any federal, state or local withholding taxes required by law
to be withheld in respect of this option.

 

(b)                                 The
Participant acknowledges that no election under Section 83(b) of the
Internal Revenue Code of 1986 may be filed with respect to this award.

 

8.                                       Miscellaneous.

 

(a)                                  No
Rights to Employment.  The
Participant acknowledges and agrees that the vesting of the RSUs pursuant to Section 2
hereof is earned only by continuing service as an employee at the will of the
Company (not through the act of being hired or purchasing shares
hereunder).  The Participant further
acknowledges and agrees that the transactions contemplated hereunder and the
vesting schedule set forth herein do not constitute an express or implied
promise of continued engagement as an employee or consultant for the vesting
period, for any period, or at all.

 

(b)                                 Severability.  The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, and each other provision of this
Agreement shall be severable and enforceable to the extent permitted by law.

 

(c)                                  Waiver.  Any provision for the benefit of the Company
contained in this Agreement may be waived, either generally or in any
particular instance, by the Board of Directors of the Company.

 

(d)                                 Binding
Effect.  This Agreement shall be
binding upon and inure to the benefit of the Company and the Participant and
their respective heirs, executors, administrators, legal representatives,
successors and assigns, subject to the restrictions on transfer set forth in Section 4
of this Agreement. 

 

(e)                                  Notice.   All notices required or permitted hereunder
shall be in writing and deemed effectively given upon personal delivery or five
days after deposit in the United States Post Office, by registered or certified
mail, postage prepaid, addressed to the other party hereto at the address shown
beneath his or its respective signature to this Agreement, or at such other
address or addresses as either party shall designate to the other in accordance
with this Section 8(e).

 

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(f)                                    Pronouns.  Whenever the context may require, any
pronouns used in this Agreement shall include the corresponding masculine,
feminine or neuter forms, and the singular form of nouns and pronouns shall
include the plural, and vice versa.

 

(g)                                 Entire
Agreement.  This Agreement and the
Plan, together with the Offer Letter, constitute the entire agreement between
the parties, and supersede all prior agreements and understandings, relating to
the subject matter of this Agreement.

 

(h)                                 Amendment.  This Agreement may be amended or modified
only by a written instrument executed by both the Company and the Participant.

 

(i)                                     Governing
Law.  This Agreement shall be
construed, interpreted and enforced in accordance with the internal laws of the
State of Delaware without regard to any applicable conflicts of laws.

 

(j)                                     Participant’s
Acknowledgments.  The Participant
acknowledges that he or she: (i) has read this Agreement; (ii) has
been represented in the preparation, negotiation, and execution of this
Agreement by legal counsel of the Participant’s own choice or has voluntarily
declined to seek such counsel; (iii) understands the terms and
consequences of this Agreement; (iv) is fully aware of the legal and
binding effect of this Agreement; and (v) understands that the law firm of
Wilmer Cutler Pickering Hale and Dorr LLP, is acting as counsel to the Company
in connection with the transactions contemplated by the Agreement, and is not
acting as counsel for the Participant.

 

(k)                                  Unfunded
Rights.  The right of the Participant
to receive Common Stock pursuant to this Agreement is an unfunded and unsecured
obligation of the Company.  The Participant
shall have no rights under this Agreement other than those of an unsecured
general creditor of the Company.

 

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

 

	
   

  	
  THE FIRST MARBLEHEAD CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Donald R. Peck

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Donald
  R. Peck

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chief
  Financial Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/
  Peter B. Tarr

  	
   

  
	
   

  	
  Peter
  B. Tarr

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  3
  Brooks Circle

  
	
   

  	
   

  	
  Beverly,
  MA 01915Exhibit 10.34.5

 

The First Marblehead Corporation

 

Executive Incentive Compensation Plan

 

Article 1. Name

 

This plan shall be known as the “Executive Incentive Compensation Plan”
(the “Plan”).

 

Article 2. Purpose and Intent

 

The First Marblehead Corporation established this Plan effective July 1,
2004 for the purpose of providing certain of its executive officers with annual
and long-term incentive compensation based on the annual or long-term
performance of the Company measured by an objective corporate performance
measure(s). The intent of the Plan is to provide “performance-based
compensation” within the meaning of Section 162(m)(4)(C) of the Code.
The provisions of the Plan shall be construed and interpreted to effectuate
such intent.

 

Article 3. Definitions

 

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

 

3.1  “Affiliate”  means
any corporation, partnership, limited liability company or partnership,
association, trust or other entity or organization which, directly or indirectly,
controls, is controlled by, or is under common control with the Company. For
purposes of the preceding sentence, “control” (including, with correlative
meanings, the terms “controlled by” and “under common control with”), as used
with respect to any entity or organization, shall mean the possession, directly
or indirectly, of the power (i) to vote more than fifty percent (50%) of
the securities having ordinary voting power for the election of directors of
the controlled entity or organization, or (ii) to direct or cause the
direction of the management and policies of the controlled entity or
organization, whether through the ownership of voting securities or by contract
or otherwise. 

 

3.2  “Annual Incentive Award”  means
an award to a Covered Employee pursuant to Article 6 and which covers a
period of time equal to or less than twelve (12) months. 

 

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

 

3.4  “Code”  means the Internal Revenue Code of 1986, as
amended from time to time, and references thereto shall include the valid
Treasury regulations thereunder. 

 

3.5  “Committee”  means all of the members of the Compensation
Committee of the Board, or any other committee delegated by the Board or the
Compensation Committee of the Board to handle compensation matters, who are
Outside Directors. 

 

3.6  “Company”  means The First Marblehead Corporation, a
Delaware corporation, and any successor thereto. 

 

3.7  “Covered
Employee”  means
any key Employee of the Company who is or may become a “Covered Employee,” as
defined in Section 162(m) of the Code, and who is designated, either as an
individual Employee or class of Employees, by the Committee within the shorter
of (i) ninety (90) days after the beginning of the Plan Year for
Annual Incentive Awards or the Long-Term Performance Period for Long-Term
Incentive Awards, or (ii) twenty-five percent (25%) of the period of
service which has elapsed, as a “Covered Employee” under the Plan for such
applicable performance period. 

 

3.8  “Employee”  means any employee of the Company, its
Affiliates, and/or its Subsidiaries. 

 

3.9  “Long-Term
Incentive Award” 
means an award granted to a Covered Employee pursuant to Article 7
and which covers a Long-Term Performance Period. 

 

3.10  “Long-Term
Performance Period” 
means a period of time greater than twelve (12) months during which
performance goal(s) established by the Committee based on one or more
Performance Measures must be met. 

 

3.11  “Operating
Income”  means,
with respect to a Plan Year, “income from operations” of the Company determined
by the Company’s certified public accountants in accordance with generally
accepted accounting principles for purposes of inclusion in the Company’s
Annual Report to 

 

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Stockholders for such Plan Year. The determination of Operating Income
by the Company’s certified public accountants shall be final and binding on all
persons. 

 

3.12  “Outside
Director”  means
a member of the Board who is an “outside director” within the meaning of Section
162(m)(4)(C)(i) of the Code and regulations promulgated thereunder. 

 

3.13  “Performance-Based
Compensation”  means
compensation that satisfies the requirements of Section 162(m) of the Code
for deductibility of remuneration paid to Covered Employees as “performance-based
compensation”. 

 

3.14  “Performance
Measures”  means
measures as described in Article 8 on which the performance goals are
based and which are approved by the Company’s shareholders pursuant to this
Plan in order to qualify Long-Term Incentive Awards as Performance-Based
Compensation. 

 

3.15  “Plan
Year”  means the
shorter of the (i) fiscal year of the Company beginning July 1 and
ending June 30, or (ii) the period of service. 

 

3.16  “Subsidiary”  means any corporation or other entity,
whether domestic or foreign, in which the Company has or obtains, directly or
indirectly, a proprietary interest of more than fifty percent (50%) by reason
of stock ownership or otherwise.

 

Article 4. Administration

 

The Committee shall be responsible for administering the Plan. The
Committee shall have all of the powers necessary to enable it to properly carry
out its duties under the Plan. Not in limitation of the foregoing, the
Committee shall have the power to construe and interpret the Plan and to
determine all questions that shall arise thereunder. The Committee shall have
such other and further specified duties, powers, authority, and discretion as
are elsewhere in the Plan either expressly or by necessary implication
conferred upon it. The Committee may appoint such agents, who need not be
members of the Committee, as it may deem necessary for the effective
performance of its duties, and may delegate to such agents such powers and
duties as the Committee may deem expedient or appropriate that are not
inconsistent with the intent of the Plan or the requirements of Section 162(m).
The decision of the Committee upon all matters within its scope of authority
shall be final and conclusive on all persons, except to the extent otherwise
provided by law.

 

Article 5. Applicable Limits

 

5.1  Annual Incentive Award.  The maximum aggregate amount awarded or
credited in any one Plan Year to a Covered Employee with respect to an Annual
Incentive Award shall be determined in accordance with Section 6.1.

 

5.2  Long-Term Incentive Awards.  The maximum aggregate amount awarded or
credited in any one Plan Year to a Covered Employee with respect to Long-Term
Incentive Awards to a Covered Employee in a Plan Year may not exceed ten million
dollars ($10,000,000).

 

Article 6. Annual Incentive Awards

 

6.1  Establishment of Incentive Pool.  The Committee may designate Covered Employees
who are eligible to receive a monetary payment in any Plan Year based on a
percentage of an incentive pool equal to five percent (5%) of the Company’s
Operating Income for the Plan Year. The Committee shall allocate an incentive
pool percentage to each designated Covered Employee for each Plan Year. In no
event may (i) the incentive pool percentage for any one Covered Employee
exceed fifty percent (50%) of the total pool, and (ii) the sum of the
incentive pool percentages for all Covered Employees cannot exceed one hundred
percent (100%) of the total pool.

 

6.2  Determination of Covered
Employees’ Portions. 
As soon as possible after the determination of the incentive pool for a
Plan Year, the Committee shall calculate each Covered Employee’s allocated
portion of the incentive pool (the “Incentive Pool Allocation”) based upon the
percentage established at the beginning of the Plan Year and subject to the
limit pursuant to Section 6.1. Each Covered Employee’s Annual Incentive
Award then shall be determined by the Committee based on the Covered Employee’s
Incentive Pool Allocation subject to adjustment in the sole discretion of the
Committee pursuant to Section 6.3. In no event may the portion of the
Incentive Pool Allocation to a Covered Employee be increased in any way,
including as a result of the reduction of any other Covered Employee’s
allocated portion.

 

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6.3  Adjustment of Incentive Pool
Allocation.  The
Incentive Pool Allocation to a Covered Employee pursuant to Section 6.2
may not be adjusted upward. The Committee shall have full discretion to adjust
such Incentive Pool Allocation downward (including without limitation the
discretion to reduce such Incentive Pool Allocation to zero), on such basis as
the Committee determines in its sole discretion.

 

6.4  Form and Timing of Payment.  The Incentive Pool Allocation, as adjusted
pursuant to Section 6.3, shall be paid in cash as soon as possible after
the end of the Plan Year, subject to written certification by the Committee of
the amount of Operating Income for such Plan Year in accordance with Section 162(m)(4)(C)(iii) of
the Code. However, the Committee may permit or require a Covered Employee to
defer receipt of the payment of cash that would otherwise be payable to the
Covered Employee. If any such deferral election is required or permitted, the
Committee, shall, in its sole discretion, establish rules and procedures
for such payment deferrals.

 

6.5  Tax Withholding.  The Company shall have the power and the
right to deduct or withhold, or require the Covered Employee to remit to the
Company, the minimum statutory amount to satisfy federal, state, and local
taxes, required by law or regulation to be withheld with respect to any taxable
event arising as a result of this Plan.

 

6.6  Termination of Employment.  The Committee shall determine the extent to
which a Covered Employee shall have the right to receive payment for his or her
Annual Incentive Awards following termination of the Covered Employee’s
employment with or provision of services to the Company, its Affiliates, and/or
its Subsidiaries, as the case may be. Such provisions shall be determined in
the sole discretion of the Committee, such provisions may be included in an
award agreement entered into with each Covered Employee, but need not be
uniform among all Annual Incentive Awards granted pursuant to the Plan, and may
reflect distinctions based on the reasons for termination.

 

Article 7. Long-Term Incentive Awards

 

7.1  Grant of Long-Term Incentive
Awards.  Subject to the
terms and provisions of the Plan, the Committee, at any time and from time to
time, may grant Long-Term Incentive Awards to Participants in such amounts and
upon such terms, including the achievement of specific performance goals, as
the Committee may determine.

 

7.2  Value of Long-Term Incentive
Awards.  Each Long-Term
Incentive Award shall specify a payment amount or payment range as determined
by the Committee subject to the achievement of certain performance goal(s)
established by the Committee, based on one or more Performance Measures. The
number and/or value of Long-Term Incentive Awards that will be paid out to the
Participant will depend on the extent to which the performance goals are met
during the applicable Long-Term Performance Period.

 

7.3  Payment of Long-Term Incentive
Awards.  Payment, if
any, with respect to a Long-Term Incentive Award shall be made in cash in
accordance with the terms of the Award, as the Committee determines.

 

7.4  Termination of Employment.  The Committee shall determine the extent to
which a Covered Employee shall have the right to receive payment for his or her
Long-Term Incentive Awards following termination of the Covered Employee’s
employment with or provision of services to the Company, its Affiliates, and/or
its Subsidiaries, as the case may be. Such provisions shall be determined in
the sole discretion of the Committee, such provisions may be included in an
award agreement entered into with each Participant, but need not be uniform
among all Long-Term Incentive Awards granted pursuant to the Plan, and may
reflect distinctions based on the reasons for termination.

 

Article 8. Performance Measures

 

8.1  Performance Measures.  Unless and until the Committee proposes for
shareholder vote and the shareholders approve a change in the general
Performance Measures set forth in this Article 8, the performance goals
upon which the payment or vesting of a Long-Term Incentive Award to a Covered
Employee (other than an Annual Incentive Award awarded or credited pursuant to Article 6)
that is intended to qualify as Performance-Based Compensation shall be limited
to the following Performance Measures:

 

(a)          Net earnings or net income (before or after
taxes);

 

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(b)         Earnings per share;

 

(c)          Net service revenue or revenue growth;

 

(d)         Net income from operations;

 

(e)          Return measures (including, but not limited
to, return on assets, capital, invested capital, equity, sales, or revenue);

 

(f)            Cash flow (including, but not limited to,
operating cash flow, free cash flow, and cash flow return on equity);

 

(g)         Earnings before or after taxes, interest,
depreciation, and/or amortization;

 

(h)         Productivity ratios;

 

(i)             Share price (including, but not limited
to, growth measures and total shareholder return);

 

(j)             Expense targets;

 

(k)          Margins;

 

(l)             Operating efficiency;

 

(m)       Market share;

 

(n)         Client satisfaction;

 

(o)         Working capital targets; and

 

(p)         Economic value added or EVA® (net operating
profit after tax minus the sum of capital multiplied by the cost of capital).

 

Any Performance Measure(s) may be used to measure the performance of
the Company, Subsidiary, and/or Affiliate as a whole or any business unit of
the Company, Subsidiary, and/or Affiliate or any combination thereof, as the
Committee may deem appropriate, or any of the above Performance Measures as
compared to the performance of a group of comparator companies, or published or
special index that the Committee, in its sole discretion, deems appropriate, or
the Company may select Performance Measure (j) above as compared to
various stock market indices. The Committee also has the authority to provide
for accelerated vesting of any Award based on the achievement of performance
goals pursuant to the Performance Measures specified in this Article 8.

 

8.2  Evaluation of Performance.  The Committee may provide in any such
Long-Term Incentive Award that any evaluation of performance may include or
exclude any of the following events that occurs during a Performance Period: (a) asset
write-downs, (b) litigation or claim judgments or settlements, (c) the
effect of changes in tax laws, accounting principles, or other laws or
provisions affecting reported results, (d) any reorganization and
restructuring programs, (e) extraordinary nonrecurring items as described
in Accounting Principles Board Opinion No. 30 and/or in management’s
discussion and analysis of financial condition and results of operations
appearing in the Company’s annual report to shareholders for the applicable
year, (f) acquisitions or divestitures, and (g) foreign exchange
gains and losses. These inclusions or exclusions shall be prescribed in a form
that meets the requirements of Code Section 162(m) for deductibility.

 

8.3  Adjustment of Performance-Based
Compensation. 
Long-Term Incentive Awards that are intended to qualify as Performance-Based
Compensation may not be adjusted upward. The Committee shall retain the
discretion to adjust such awards downward, either on a formula or discretionary
basis or any combination, as the Committee determines.

 

8.4  Committee Discretion.  In the event that applicable tax and /or
securities laws change to permit Committee discretion to alter the governing
Performance Measures without obtaining shareholder approval of such changes,
the Committee shall have sole discretion to make such changes without obtaining
shareholder approval. In addition, in the event that the Committee determines
that it is advisable to grant Long-Term Incentive Awards that shall not qualify
as Performance-Based Compensation, the Committee may make such grants without
satisfying the requirements of Code Section 162(m) and base vesting on
Performance Measures other than those set forth in Section 8.1.

 

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Article 9. Beneficiary Designation

 

Each Covered Employee under the Plan may, from time to time, name any beneficiary
or beneficiaries (who may be named contingently or successively) to whom any
benefit under the Plan is to be paid in case of his or her death before he or
she receives any or all of such benefit. Each such designation shall revoke all
prior designations by the same Covered Employee, shall be in a form prescribed
by the Committee, and will be effective only when filed by the Covered Employee
in writing with the Company during the Covered Employee’s lifetime. In the
absence of any such designation, benefits remaining unpaid at the Covered
Employee’s death shall be paid to the Covered Employee’s estate.

 

Article 10. Stockholder Approval

 

The effectiveness of the Plan is subject to the approval of the
stockholders of the Company to the extent required by Section 162(m)(4)(C)(ii) of
the Code.

 

Article 11. Amendment, Modification, and
Termination of the Plan

 

The Board may amend, modify, or terminate the Plan at any time,
provided that no amendment, modification, or termination of the Plan shall
reduce the amount payable to a Covered Employee under the Plan as of the date
of such amendment, modification, or termination. No amendment which would
require stockholder approval under Section 162(m) of the Code may be
effected without such stockholder approval.

 

Article 12. Applicable Law

 

The Plan shall be construed, administered, regulated, and governed in
all respects under and by the laws of the United States to the extent
applicable, and to the extent such laws are not applicable, by the laws of the
state of Delaware.

 

Article 13. Miscellaneous

 

A Covered Employee’s rights and interests under the Plan may not be
assigned or transferred by the Covered Employee. To the extent the Covered
Employee acquires a right to receive payments from the Company under the Plan,
such right shall be no greater than the right of any unsecured general creditor
of the Company. Nothing contained herein shall be deemed to create a trust of
any kind or any fiduciary relationship between the Company and the Covered
Employee. Designation as a Covered Employee in the Plan shall not entitle or be
deemed to entitle a Covered Employee to continued employment with the Company.

 

5

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