Document:

Exhibit 10.26

 

INVESTMENT TECHNOLOGY GROUP, INC.

PERFORMANCE STOCK UNIT GRANT AGREEMENT

FOR EMPLOYEES

 

THIS GRANT AGREEMENT, dated as of                            
(the “Date of Grant”), is entered into by and between Investment
Technology Group, Inc. (the “Company”), a Delaware corporation, and
                        ,
an employee of the Company (the “Employee”).

 

WHEREAS, the Employee has been awarded the following Grant
under the Investment Technology Group, Inc. 2007 Omnibus Equity
Compensation Plan (the “Plan”). 
Capitalized terms used herein and not defined herein shall have the
meanings set forth in the Plan.  In the
event of any conflict between this Grant Agreement and the Plan, the Plan shall
control.

 

NOW, THEREFORE, in consideration of the premises and
mutual covenants contained herein, and for other good and valuable
consideration, the parties hereto agree as follows:

 

1.          Grant
of Stock Units.  Subject to the terms and conditions set forth in
this Grant Agreement and the Plan, the Employee is hereby awarded           
Stock Units that represent hypothetical shares of Company Stock on a
one-for-one basis (the “Stock Unit Grant”).

 

2.          Grant Subject to Plan Provisions.  This Stock
Unit Grant is granted pursuant to the Plan, the terms of which are incorporated
herein by reference, and in all respects shall be interpreted in accordance
with the Plan.  The Plan and the Plan
prospectus are available at http://assetlib.itginc.com/stellent/groups/public/documents/itginc/047794.pdf
and  http://assetlib.itginc.com/stellent/groups/public/documents/itginc/047867.pdf, respectively; provided that paper copies of the Plan
and the Plan prospectus are available upon request by contacting the Legal
Department of the Company at ITG_Legal or 212.444.6378.  This Stock Unit Grant is subject to
interpretations, regulations and determinations concerning the Plan established
from time to time by the Committee in accordance with the provisions of the
Plan, including, but not limited to, provisions pertaining to (a) the
registration, qualification or listing of the shares issued under the Plan, (b) changes
in capitalization, (c) requirements of applicable law and (d) all
other Plan provisions.  The Committee has
the authority to interpret and construe this Grant Agreement pursuant to the
terms of the Plan, and its decisions are conclusive as to any questions arising
hereunder.

 

3.          Stock
Unit Account.  The Company shall
establish and maintain a Stock Unit bookkeeping account (the “Account”)
on its records for the Employee and shall record in the Account the number of
Stock Units awarded to the Employee.  No
shares of stock shall be issued to the Employee at the time the Stock Unit
Grant is made.

 

4.          Vesting
of the Stock Unit Grant.

 

(a)        Except
as otherwise provided herein, a percentage between 0% and 100% of the Stock
Units underlying this Stock Unit Grant shall vest on [insert
third anniversary of the Date of Grant], provided that the Employee
has remained continuously 

 

1

 

employed by the Employer from the Date of Grant through the vesting
date, based on the amount of the Employer’s “Cumulative Three Year Pre-Tax
Operating Income” (as defined below) determined in accordance with the
following schedule:

 

	
  Vesting Thresholds - Cumulative Three Year

  Pre-Tax Operating Income

  	
   

  	
  Percentage of Stock Unit

  Grant that Vests

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than $     million

  	
   

  	
  0

  	
  %

  
	
  $     million

  	
   

  	
  25

  	
  %

  
	
  $     million

  	
   

  	
  50

  	
  %

  
	
  $     million

  	
   

  	
  75

  	
  %

  
	
  $     million or more

  	
   

  	
  100

  	
  %

  

 

In the event the amount of Cumulative Three Year Pre-Tax Operating
Income is between two of the thresholds set forth in the schedule above, the
percentage of the Stock Units underlying the Stock Unit Grant that shall vest shall
be determined by multiplying (A) 25% by (B) a fraction, the numerator
of which is the excess of the actual Cumulative Three Year Pre-Tax Operating
Income over the next lowest vesting threshold and the denominator of which is
the excess of the next higher vesting threshold over the next lower vesting
threshold and adding the product to the percentage corresponding to the next
lowest vesting threshold.

 

For example, if Cumulative Three Year Pre-Tax Operating Income is $      million, the vesting percentage would be 86.5%
= [[(     -     )/(    
-       )] x 25%] + 75%.

 

For purposes hereof, (i) “Cumulative Three Year Pre-Tax
Operating Income” shall mean the Employer’s “Pre-Tax Operating Income” for
the period beginning             
through             ,
and (ii) “Pre-Tax Operating Income” means the consolidated pre-tax
income of the Employer, computed in accordance with generally accepted
accounting principles, (A) prior to reduction for income taxes and (B) excluding
one time gains, nonrecurring restructuring charges and non-cash charges
(including impairment of good will).  The
determination of “Cumulative Three Year Pre-Tax Operating Income” shall be made
by the Committee in good faith, which determination shall be binding on the
Employee.

 

(b)        To the
extent the Stock Unit Grant does not vest on           ,
the Stock Unit Grant shall be forfeited. 
In the event of the Employee’s Termination of Service (as defined below)
for any reason prior to           ,
all Stock Units underlying the Stock Unit Grant that are not then vested shall
be forfeited.

 

(c)        Notwithstanding
any other provision of this Grant Agreement to the contrary, upon the
occurrence of a Change in Control prior to             ,
100% of the Stock Unit Grant shall become vested as of the date of the Change
in Control, provided that the Employee has remained continuously employed by
the Employer from the Date of Grant through the date of such Change in Control.

 

(d)        Unless
otherwise provided by the Committee, all amounts receivable in connection with
any adjustments to the Company Stock under Section 5(d) of the Plan shall
be subject to the vesting schedule in this Section 4.

 

2

 

5.             Termination
of Service; Forfeiture of Unvested Stock Unit Grant.  In the event of the Employee’s Termination of
Service prior to the date the Stock Unit Grant otherwise becomes vested in
accordance with the provisions of Section 4 above, the Stock Unit Grant
shall immediately be forfeited by the Employee.

 

“Termination of Service” means the Employee ceases to be
employed by the Employer.  An Employee
employed by a Subsidiary of the Company shall also be deemed to incur a
Termination of Service if such Subsidiary ceases to be a Subsidiary of the
Company and such Employee does not immediately thereafter become employed by the
Company or another Subsidiary of the Company. 
Temporary absences from employment because of illness, vacation or leave
of absence and transfers among Employers shall not be considered a Termination
of Service.

 

6.             Distribution of Shares.  The Company shall distribute to the Employee
(or the Employee’s heirs in the event of the Employee’s death) at the time of
vesting of the Stock Unit Grant in accordance with Section 4 above (but
not later than March 15 of the calendar year following the calendar year
in which the Stock Units vest), a number of shares of Company Stock equal to
the number of Stock Units then held by the Employee that became vested at such
time, subject to reduction for withholding of shares pursuant to Section 9
below.

 

7.             Rights
and Restrictions.  The Stock Unit
Grant shall not be transferable, other than by will or under the laws of
descent and distribution (or pursuant to a beneficiary designation authorized
by the Committee).  Prior to vesting of
the Stock Unit Grant and delivery of the shares of Company Stock to the
Employee, the Employee shall not have any rights or privileges of a stockholder
as to the shares of Company Stock subject to the Stock Unit Grant.  Specifically, the Employee shall not have the
right to receive dividends or the right to vote such shares of Company Stock,
nor shall the Employee have the right to sell, assign, pledge, hypothecate,
encumber, transfer or otherwise dispose of, in whole or in part, the Stock Unit
Grant, prior to vesting of the Stock Unit Grant and delivery of the shares of
Company Stock.  The Employee shall not
have any interest in any fund or specific assets of the Employer by reason of
this Stock Unit Grant or the Account established for the Employee.

 

8.             Limitations.  Nothing herein shall limit the Company’s
right to issue Company Stock, Stock Units or other rights to purchase Company
Stock subject to vesting, expiration and other terms and conditions deemed
appropriate by the Company and its affiliates. 
Nothing expressed or implied herein is intended or shall be construed to
confer upon or give to any Person, other than the parties hereto, any right,
remedy or claim under or by reason of this Grant Agreement or of any term,
covenant or condition hereof.

 

9.             Withholding.  The Employee shall pay to the Employer or
make arrangements satisfactory to the Committee regarding payment of any
federal, state or local taxes of any kind required by law to be withheld at any
time with respect to the Stock Unit Grant and the Employer shall, to the extent
permitted or required by law, have the right to deduct from any payment of any
kind otherwise due to the Employee, federal, state and local taxes of any kind
required by law to be withheld.  To the
extent permitted by the Committee, the Employee may elect to have the Employer
withhold Company Stock to pay any applicable withholding taxes 

 

3

 

resulting from the Stock Unit Grant, in accordance with any rules or
regulations of the Committee then in effect.

 

10.           Expenses
of Issuance of Company Stock.  The
issuance of stock certificates hereunder shall be without charge to the
Employee.  The Company shall pay, and
indemnify the Employee from and against any issuance, stamp or documentary
taxes (other than transfer taxes) or charges imposed by any governmental body,
agency or official (other than income taxes) by reason of the issuance of Company
Stock.

 

11.           Terms
are Binding.  The terms of this Grant
Agreement shall be binding upon the executors, administrators, heirs,
successors, transferees and assignees of the Employee and the Company.

 

12.           Compliance
with Law.  The transfer of Company
Stock hereunder shall be subject to the terms, conditions and restrictions as
set forth in the governing instruments of the Company, Company policies, applicable
federal and state securities laws or any other applicable laws or regulations,
and approvals by any governmental or regulatory agency as may be required.  By signing this Grant Agreement, the Employee
agrees not to sell any Company Stock at a time when applicable laws or the
Company policies prohibit a sale.

 

13.           References.  References
herein to rights and obligations of the Employee shall apply, where
appropriate, to the Employee’s legal representative or estate without regard to
whether specific reference to such legal representative or estate is contained
in a particular provision of this Grant Agreement.

 

14.           Notices.  Any
notice required or permitted to be given under this Grant Agreement shall be in
writing and shall be deemed to have been given when delivered personally or by
courier, or sent by certified or registered mail, postage prepaid, return
receipt requested, duly addressed to the party concerned at the address
indicated below or to such changed address as such party may subsequently, by
similar process, give notice of:

 

If to the Company:

 

Investment Technology Group, Inc.

380 Madison Avenue

New York, NY 10017

Attention: General Counsel

 

If to the Employee:

 

At the Employee’s most recent address shown on the
Employer’s corporate records, or at any other address at which the Employee may
specify in a notice delivered to the Company in the manner set forth herein.

 

15.           No
Right to Continued Employment.  This Stock
Unit Grant shall not confer upon the Employee any right to continue in the employ
of the Employer nor shall this Stock Unit Grant interfere with the right of the
Employer to terminate the Employee’s employment at any time.

 

4

 

16.           Section 409A.  It is intended that the Stock Unit Grant
issued hereunder shall comply with Section 409A of the Code (and any
regulations and guidelines issued thereunder) to the extent the Stock Unit
Grant is subject thereto, and the Stock Unit Grant shall be interpreted on a
basis consistent with such intent.  In no
event shall the Employee, directly or indirectly, designate the calendar year
in which the shares underlying the Stock Unit Grant will be distributed.  This Grant Agreement
may be amended without the consent of the Employee in any respect deemed by the
Committee to be necessary in order to preserve compliance with Section 409A
of the Code.

 

17.           Costs.  In any action at law or in equity to enforce
any of the provisions or rights under this Grant Agreement, including any
arbitration proceedings to enforce such provisions or rights, the unsuccessful
party to such litigation or arbitration, as determined by the court in a final
judgment or decree, or by the panel of arbitrators in its award, shall pay the
successful party or parties all costs, expenses and reasonable attorneys’ fees
incurred by the successful party or parties (including without limitation
costs, expenses and fees on any appeals), and if the successful party recovers
judgment in any such action or proceeding such costs, expenses and attorneys’
fees shall be included as part of the judgment.

 

18.           Further
Assurances.  The Employee agrees to
perform all acts and execute and deliver any documents that may be reasonably
necessary to carry out the provisions of this Grant Agreement, including but
not limited to all acts and documents related to compliance with federal and/or
state securities laws.

 

19.           Counterparts.  For convenience, this Grant Agreement may be
executed in any number of identical counterparts, each of which shall be deemed
a complete original in itself and may be introduced in evidence or used for any
other purposes without the production of any other counterparts.

 

20.           Governing
Law.  This Grant Agreement shall be
construed and enforced in accordance with Section 19(h) of the Plan.

 

21.           Entire
Agreement.  This Grant Agreement,
together with the Plan, sets forth the entire agreement between the parties
with reference to the subject matter hereof, and there are no agreements,
understandings, warranties, or representations, written, express, or implied,
between them with respect to the Stock Unit Grant other than as set forth
herein or therein, all prior agreements, promises, representations and
understandings relative thereto being herein merged.

 

22.           Amendment;
Waiver.  This Grant Agreement may be
amended, modified, superseded, canceled, renewed or extended and the terms or
covenants hereof may be waived only by a written instrument executed by the
parties hereto or, in the case of a waiver, by the party waiving compliance.  Any such written instrument must be approved
by the Committee to be effective as against the Company.  The failure of any party at any time or times
to require performance of any provision hereof shall in no manner affect the
right at a later time to enforce the same. 
No waiver by any party of the breach of any term or provision contained
in this Grant Agreement, whether by conduct or otherwise, in any one or more
instances, shall be deemed to be, or construed as, a further or continuing
waiver of any such breach, or a waiver of the breach of any other term or
covenant contained in this Grant Agreement.

 

5

 

23.           Severability.  Any provision of this Grant Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

 

[SIGNATURE PAGE FOLLOWS]

 

6

 

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

 

	
   

  	
  INVESTMENT TECHNOLOGY GROUP, INC.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name: Robert C. Gasser

  
	
   

  	
  Title: CEO and President

  

 

 

I hereby accept the Stock Unit Grant described in this Grant Agreement,
and I agree to be bound by the terms of the Plan and this Grant Agreement.  I hereby further agree that all the decisions
and determinations of the Committee shall be final and binding.

 

	
   

  	
   

  
	
   

  	
  [Insert
  Name of the Employee]Exhibit
10.27.1

 

INVESTMENT TECHNOLOGY
GROUP, INC.

 

2007 OMNIBUS EQUITY
COMPENSATION PLAN

 

Amended and
Restated Effective February 7, 2008

 

 

INVESTMENT
TECHNOLOGY GROUP, INC.

 

2007
OMNIBUS EQUITY COMPENSATION PLAN

 

1.                                      Purpose

 

The purpose of the
Investment Technology Group, Inc. 2007 Omnibus Equity Compensation Plan (the
“Plan”) is to provide (i) designated employees of Investment Technology
Group, Inc. (the “Company”) and its subsidiaries, and (ii) non-employee
members of the board of directors of the Company with the opportunity to
receive grants of stock options, stock units, stock awards, dividend
equivalents and other stock-based awards. 
The Company believes that the Plan will encourage the participants to
contribute materially to the growth of the Company, thereby benefiting the
Company’s stockholders, and will align the economic interests of the
participants with those of the stockholders. 
The Plan was originally effective on May 8, 2007 upon approval by
the stockholders of the Company.  The
effective date of this amendment and restatement is February 7, 2008.

 

The Investment Technology
Group, Inc. Non-Employee Directors Stock Option Plan (the “Director Plan”),
the Investment Technology Group, Inc. Amended and Restated 1994 Stock
Option and Long-term Incentive Plan (the “1994 Plan”), the Amended and Restated
Investment Technology Group, Inc. Stock Unit Award Program Subplan (the “SUA
Subplan”), the Amended and Restated Investment Technology Group, Inc.
Directors’ Retainer Fee Subplan (the “Directors’ Retainer Fee Subplan”), and
the Amended and Restated Investment Technology Group, Inc. Directors’
Equity Subplan (the “Directors’ Equity Subplan”, and collectively with the SUA
Subplan and the Directors’ Retainer Fee Subplan, the “Subplans”) were merged with
and into this Plan as of May 8, 2007. 
No additional grants will be made thereafter under the Director Plan and
the 1994 Plan.  Outstanding grants under
the Director Plan, the 1994 Plan and the Subplans as of May 8, 2007 will
continue in effect according to their terms as in effect on May 8, 2007
(subject to such amendments as the Committee (as defined below) determines
appropriate, consistent with the terms of the Director Plan, the 1994 Plan or
the Subplans, as applicable), and the shares with respect to such outstanding
grants will be issued or transferred under this Plan.  After May 8, 2007, the Subplans shall
continue in effect as subplans of the Plan and grants and/or deferrals may
continue to be made under the Subplans with shares associated with such grants
and/or deferrals being issued under this Plan.

 

2.                                      Definitions

 

Whenever used in this
Plan, the following terms will have the respective meanings set forth below:

 

(a)           “Board” means the Company’s Board of Directors.

 

(b)           “Change in Control” means and shall be deemed to have
occurred:

 

(i)            if
any person (within the meaning of the Exchange Act), other than the Company or
a Related Party, is or becomes the “beneficial owner” (as defined in Rule 13d-3

 

 

under the Exchange Act), directly or indirectly, of Voting Securities
representing 35% percent or more of the total voting power of all the
then-outstanding Voting Securities; or

 

(ii)           if
the individuals who, as of the date hereof, constitute the Board, together with
those who first become directors subsequent to such date and whose
recommendation, election or nomination for election to the Board was approved
by a vote of at least a majority of the directors then still in office who
either were directors as of the date hereof or whose recommendation, election
or nomination for election was previously so approved, cease for any reason to
constitute a majority of the members of the Board; or

 

(iii)          upon
consummation of a merger, consolidation, recapitalization or reorganization of
the Company, reverse split of any class of Voting Securities, or an acquisition
of securities or assets by the Company other than (i) any such transaction
in which the holders of outstanding Voting Securities immediately prior to the
transaction receive (or retain), with respect to such Voting Securities, voting
securities of the surviving or transferee entity representing more than 50
percent of the total voting power outstanding immediately after such
transaction, with the voting power of each such continuing holder relative to
other such continuing holders not substantially altered in the transaction, or (ii) any
such transaction which would result in a Related Party beneficially owning more
than 50 percent of the voting securities of the surviving or transferee entity
outstanding immediately after such transaction; or

 

(iv)          upon
consummation of the sale or disposition by the Company of all or substantially
all of the Company’s assets, other than any such transaction which would result
in a Related Party owning or acquiring more than 50 percent of the assets owned
by the Company immediately prior to the transaction; or

 

(v)           if
the stockholders of the Company approve a plan of complete liquidation of the
Company.

 

(c)           “Code” means the Internal Revenue Code of 1986, as amended.

 

(d)           “Committee” means (i) with respect to Grants to
Employees, the Compensation Committee of the Board or another committee
appointed by the Board to administer the Plan, (ii) with respect to Grants
made to Non-Employee Directors, the Board, and (iii) with respects to
Grants that are intended to be “qualified performance-based compensation” under
section 162(m) of the Code, a committee that consists of two or more
persons appointed by the Board, all of whom shall be “outside directors” as
defined under section 162(m) of the Code and related Treasury
regulations.

 

(e)           “Company” means Investment Technology Group, Inc. and
any successor corporation.

 

(f)            “Company Stock” means the common stock of the Company.

 

(g)           “Dividend Equivalent” means an amount determined by
multiplying the number of shares of Company Stock subject to a Grant by the
per-share cash dividend, or the per-share 

 

2

 

fair market value (as determined by the Committee) of any dividend in
consideration other than cash, paid by the Company on its Company Stock.

 

(h)           “Employee” means an employee of the Employer (including an
officer or director who is also an employee).

 

(i)            “Employer” means the Company and its subsidiaries.

 

(j)            “Exchange Act” means the Securities Exchange Act of 1934, as
amended.

 

(k)           “Exercise Price” means the per share price at which shares
of Company Stock may be purchased under an Option, as designated by the
Committee.

 

(l)            “Fair Market Value,”
unless otherwise required by an applicable provision of the Code, as of any
date, means the closing sales price of the Common Stock as reported on the New
York Stock Exchange on the date of grant; provided, however, that at any time
that the Common Stock is not quoted on the New York Stock Exchange on such
trading days, Fair Market Value shall be determined by the Committee in its
discretion.

 

(m)          “Grant” means an Option, Stock Unit, Stock Award, SAR,
Dividend Equivalent or Other Stock-Based Award granted under the Plan.

 

(n)           “Grant Agreement” means the written instrument that sets
forth the terms and conditions of a Grant, including all amendments thereto.

 

(o)           “Incentive Stock Option” means an Option that is intended to
meet the requirements of an incentive stock option under section 422 of the
Code.

 

(p)           “Non-Employee Director” means a member of the Board who is
not an employee of the Employer.

 

(q)           “Nonqualified Stock Option” means an Option that is not
intended to be taxed as an incentive stock option under section 422 of the
Code.

 

(r)            “Option” means an option to purchase shares of Company
Stock, as described in Section 7.

 

(s)           “Other Stock-Based Award” means any Grant based on, measured
by or payable in, Company Stock (other than a Grant described in Sections 7, 8,
9 or 10(a) of the Plan), as described in Section 10(b).

 

(t)            “Participant” means an Employee or Non-Employee Director
designated by the Committee to participate in the Plan.

 

(u)           “Person” means an individual, a partnership, a corporation,
a limited liability company, an association, a joint stock company, an estate,
a trust, a joint venture, an 

 

3

 

unincorporated organization or a governmental entity or any department,
agency or political subdivision thereof.

 

(v)           “Plan” means this Investment Technology Group, Inc.
2007 Omnibus Equity Compensation Plan, as in effect from time to time.

 

(w)          “Related Party” means (a) a Subsidiary of the Company; (b) an
employee or group of employees of the Company or any Subsidiary of the Company;
(c) a trustee or other fiduciary holding securities under an employee
benefit plan of the Company or any majority-owned Subsidiary of the Company; or
(d) a corporation owned directly or indirectly by the stockholders of the
Company in substantially the same proportion as their ownership of Voting
Securities.

 

(x)            “SAR” means a stock appreciation right as described in Section 10(a).

 

(y)           “Stock Award” means an award of Company Stock as described
in Section 9.

 

(z)            “Stock Unit” means an award of a phantom unit representing a
share of Company Stock, as described in Section 8.

 

(aa)         “Subsidiary” or “Subsidiaries” means, with respect to any
Person, any corporation, partnership, limited liability company, association or
other business entity of which (a) if a corporation, fifty (50) percent or
more of the total voting power of shares of stock entitled (without regard to
the occurrence of any contingency) to vote in the election of directors,
managers or trustees thereof is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of that
Person or combination thereof; or (b) if a partnership, limited liability
company, association or other business entity, fifty (50) percent or more of
the partnership or other similar ownership interest thereof is at the time
owned or controlled, directly or indirectly, by any Person or one or more
Subsidiaries of that Person or a combination thereof.  For purposes of this definition, a Person or
Persons will be deemed to have a fifty (50) percent or more ownership interest
in a partnership, limited liability company, association or other business
entity if such Person or Persons are allocated fifty (50) percent or more of
partnership, limited liability company, association or other business entity
gains or losses or control the managing director or member or general partner
of such partnership, limited liability company, association or other business
entity.

 

(bb)         “Voting
Securities or Security” means any securities of the Company which
carry the right to vote generally in the election of directors.

 

3.                                      Administration

 

(a)           Committee.  The Plan shall be administered and
interpreted by the Compensation Committee of the Board or another committee
appointed by the Board to administer the Plan with respect to grants to
Employees.  The Plan shall be
administered and interpreted by the Board with respect to grants to
Non-Employee Directors.  The Board or
committee, as applicable, that has authority with respect to a specific Grant
shall be referred to as the 

 

4

 

“Committee” with respect to that Grant. 
Ministerial functions may be performed by an administrative committee
comprised of Company employees appointed by the Committee.

 

(b)           Committee
Authority.  The Committee shall have
the sole authority to (i) determine the Participants to whom Grants shall
be made under the Plan, (ii) determine the type, size and terms and
conditions of the Grants to be made to each such Participant, (iii) determine
the time when the grants will be made and the duration of any applicable
exercise or restriction period, including the criteria for exercisability and
the acceleration of exercisability, (iv) amend the terms and conditions of
any previously issued Grant, subject to the provisions of Section 18
below, and (v) deal with any other matters arising under the Plan.

 

(c)           Committee
Determinations.  The Committee shall
have full power and express discretionary authority to administer and interpret
the Plan, to make factual determinations and to adopt or amend such rules,
regulations, agreements and instruments for implementing the Plan and for the
conduct of its business as it deems necessary or advisable, in its sole
discretion.  The Committee’s
interpretations of the Plan and all determinations made by the Committee
pursuant to the powers vested in it hereunder shall be conclusive and binding
on all persons having any interest in the Plan or in any awards granted
hereunder.  All powers of the Committee
shall be executed in its sole discretion, in the best interest of the Company,
not as a fiduciary, and in keeping with the objectives of the Plan and need not
be uniform as to similarly situated Participants.

 

4.                                      Grants

 

(a)           Grants
under the Plan may consist of Options as described in Section 7, Stock
Units as described in Section 8, Stock Awards as described in Section 9,
and SARs or Other Stock-Based Awards as described in Section 10.  All Grants shall be subject to such terms and
conditions as the Committee deems appropriate and as are specified in writing
by the Committee to the Participant in the Grant Agreement.

 

(b)           All
Grants shall be made conditional upon the Participant’s acknowledgement, in
writing or by acceptance of the Grant, that all decisions and determinations of
the Committee shall be final and binding on the Participant, his or her
beneficiaries and any other person having or claiming an interest under such
Grant.  Grants under a particular Section of
the Plan need not be uniform as among the Participants.

 

5.                                      Shares
Subject to the Plan

 

(a)           Shares
Authorized.  The total aggregate
number of shares of Company Stock that may be issued under the Plan shall equal
that number of shares of
Company Stock subject to outstanding grants under the Director Plan and the
1994 Plan as of May 8, 2007 as well as shares remaining available for
issuance under the Director Plan and the 1994 Plan but not subject to
previously exercised, vested or paid grants as of May 8, 2007.

 

(b)           Source
of Shares; Share Counting.  Shares
issued under the Plan may be authorized but unissued shares of Company Stock or
reacquired shares of Company Stock, including shares purchased by the Company
on the open market for purposes of the Plan. 
If and 

 

5

 

to the extent Options or SARs granted under the Plan (including options
granted under the Director Plan, the 1994 Plan and the Subplans) terminate,
expire, or are canceled, forfeited, exchanged or surrendered without having
been exercised, and if and to the extent that any Stock Awards, Stock Units, or
Other Stock-Based Awards (including any stock awards, stock units or
other-stock based awards granted under the Director Plan, the 1994 Plan and the
Subplans) are forfeited or terminated, or otherwise are not paid in full, the
shares reserved for such Grants shall again be available for purposes of the
Plan.  Shares of Company Stock
surrendered in payment of the Exercise Price of an Option shall again be available
for purposes of the Plan.  To the extent any Grants are paid in cash,
and not in shares of Company Stock, any shares previously subject to such
Grants shall again be available for issuance or transfer under the Plan.

 

(c)           Individual
Limits.  All Grants under the Plan
shall be expressed in shares of Company Stock. 
The maximum aggregate number of shares of Company Stock with respect to
which all Grants may be made under the Plan to any individual during any
calendar year shall be 1,000,000 shares, subject to adjustment as described in
subsection (d) below.  A Participant
may not accrue Dividend Equivalents during any calendar year in excess of
$1,000,000.  The individual limits of
this subsection (c) shall apply without regard to whether the Grants are
to be paid in Company Stock or cash.  All
cash payments (other than with respect to Dividend Equivalents) shall equal the
Fair Market Value of the shares of Company Stock to which the cash payments
relate.

 

(d)           Adjustments.  If there is any change in the number or kind
of shares of Company Stock outstanding by reason of a stock dividend, spinoff,
stock split or reverse stock split, or by reason of a combination,
reorganization, recapitalization or reclassification affecting the outstanding
Company Stock as a class without the Company’s receipt of consideration, the
maximum number of shares of Company Stock available for Grants, the maximum
number of shares of Company Stock that any individual participating in the Plan
may be granted in any year, the number of shares covered by outstanding Grants,
the kind of shares issued under the Plan and outstanding Grants, and the price
per share of outstanding Grants shall be equitably adjusted by the Committee,
as the Committee deems appropriate, to reflect any increase or decrease in the
number of, or change in the kind or value of, issued shares of Company Stock to
preclude, to the extent practicable, the enlargement or dilution of rights and
benefits under Grants; provided, however, that any fractional shares resulting
from such adjustment shall be eliminated. 
In addition, the Committee shall have discretion to make the foregoing
equitable adjustments in any circumstances in which an adjustment is not
mandated by this subsection (d) or applicable law, including in the event
of a Change in Control.  Any adjustments
to outstanding Grants shall be consistent with section 409A or 422 of the Code,
to the extent applicable.  Any
adjustments determined by the Committee shall be final, binding and conclusive.

 

6.                                      Eligibility
for Participation

 

(a)           Eligible
Persons.  All Employees, including
Employees who are officers or members of the Board, and all Non-Employee
Directors shall be eligible to participate in the Plan.

 

6

 

(b)           Selection
of Participants.  The Committee shall
select the Employees and Non-Employee Directors to receive Grants and shall
determine the number of shares of Company Stock subject to each Grant.

 

7.                                      Options

 

(a)           General
Requirements. The Committee may grant Options to an Employee or
Non-Employee Director upon such terms and conditions as the Committee deems
appropriate under this Section 7. 
The Committee shall determine the number of shares of Company Stock that
will be subject to each Grant of Options to Employees and Non-Employee
Directors.

 

(b)           Type of Option, Price and Term.

 

(i)            The
Committee may grant Incentive Stock Options or Nonqualified Stock Options or
any combination of the two, all in accordance with the terms and conditions set
forth herein.  Incentive Stock Options
may be granted only to Employees of the Company or its parents or subsidiaries,
as defined in section 424 of the Code. 
Nonqualified Stock Options may be granted to Employees or Non-Employee
Directors.

 

(ii)           The
Exercise Price of Company Stock subject to an Option shall be determined by the
Committee and may be equal to or greater than the Fair Market Value of a share
of Company Stock on the date the Option is granted.  However, an Incentive Stock Option may not be
granted to an Employee who, at the time of grant, owns stock possessing more
than 10% of the total combined voting power of all classes of stock of the
Company or any parent or subsidiary, as defined in section 424 of the Code,
unless the Exercise Price per share is not less than 110% of the Fair Market
Value of the Company Stock on the date of grant.

 

(iii)          The
Committee shall determine the term of each Option, which shall not exceed ten
years from the date of grant.  However,
an Incentive Stock Option that is granted to an Employee who, at the time of
grant, owns stock possessing more than 10% of the total combined voting power
of all classes of stock of the Company or any parent or subsidiary, as defined
in section 424 of the Code, may not have a term that exceeds five years from
the date of grant.

 

(c)           Exercisability of Options.

 

(i)            Options
shall become exercisable in accordance with such terms and conditions as may be
determined by the Committee and specified in the Grant Agreement.  The Committee may accelerate the
exercisability of any or all outstanding Options at any time for any reason.

 

(ii)           The
Committee may provide in a Grant Agreement that the Participant may elect to
exercise part or all of an Option before it otherwise has become
exercisable.  Any shares so purchased
shall be restricted shares and shall be subject to a repurchase right in favor
of the Company during a specified restriction period, with the repurchase price
equal to the lesser of (A) the Exercise Price or (B) the Fair Market
Value of such shares at the time of repurchase, or such other restrictions as
the Committee deems appropriate.

 

7

 

(iii)          Options
granted to persons who are non-exempt employees under the Fair Labor Standards
Act of 1938, as amended, may not be exercisable for at least six months after
the date of grant (except that such Options may become exercisable, as
determined by the Committee, upon the Participant’s death, Disability or
retirement, or upon a Change in Control or other circumstances permitted by
applicable regulations).

 

(d)           Termination
of Employment or Service.  Except as
provided in the Grant Agreement, an Option may only be exercised while the
Participant is employed by the Employer, or providing service as a Non-Employee
Director.  The Committee shall determine
in the Grant Agreement under what circumstances and during what time periods a
Participant may exercise an Option after termination of employment or service.

 

(e)           Exercise
of Options.  A Participant may
exercise an Option that has become exercisable, in whole or in part, by
delivering a notice of exercise to the Company. 
The Participant shall pay the Exercise Price for the Option (i) in
cash, (ii) if permitted by the Committee, by delivering shares of Company
Stock owned by the Participant and having a Fair Market Value on the date of
exercise equal to the Exercise Price or by attestation to ownership of shares
of Company Stock having an aggregate Fair Market Value on the date of exercise
equal to the Exercise Price, (iii) by payment through a broker in
accordance with procedures permitted by Regulation T of the Federal Reserve
Board, or (iv) by such other method as the Committee may approve.  Shares of Company Stock used to exercise an
Option shall have been held by the Participant for the requisite period of time
to avoid adverse accounting consequences to the Company with respect to the
Option.  Payment for the shares pursuant
to the Option, and any required withholding taxes, must be received by the time
specified by the Committee depending on the type of payment being made, but in
all cases prior to the issuance of the Company Stock.

 

(f)            Limits
on Incentive Stock Options.  Each
Incentive Stock Option shall provide that, if the aggregate Fair Market Value
of the stock on the date of the grant with respect to which Incentive Stock
Options are exercisable for the first time by a Participant during any calendar
year, under the Plan or any other stock option plan of the Company or a parent
or subsidiary, as defined in section 424 of the Code, exceeds $100,000, then the
Option, as to the excess, shall be treated as a Nonqualified Stock Option.  An Incentive Stock Option shall not be
granted to any person who is not an Employee of the Company or a parent or
subsidiary, as defined in section 424 of the Code.

 

8.                                      Stock
Units

 

(a)                                  General
Requirements.  The Committee may
grant Stock Units to an Employee or Non-Employee Director, upon such terms and
conditions as the Committee deems appropriate under this Section 8.  Each Stock Unit shall represent the right of
the Participant to receive a share of Company Stock or an amount based on the
value of a share of Company Stock.  All
Stock Units shall be credited to bookkeeping accounts on the Company’s records
for purposes of the Plan.

 

(b)                                 Terms
of Stock Units.  The Committee may grant
Stock Units that are payable on terms and conditions determined by the
Committee, which may include payment based on 

 

8

 

achievement of performance goals. 
Stock Units may be paid at the end of a specified vesting or performance
period, or payment may be deferred to a date authorized by the Committee.  The Committee shall determine the number of
Stock Units to be granted and the requirements applicable to such Stock Units.

 

(c)           Payment
With Respect to Stock Units.  Payment
with respect to Stock Units shall be made in cash, in Company Stock, or in a
combination of the two, as determined by the Committee.  The Grant Agreement shall specify the maximum
number of shares that can be issued under the Stock Units.

 

(d)           Requirement
of Employment or Service.  The
Committee shall determine in the Grant Agreement under what circumstances a
Participant may retain Stock Units after termination of the Participant’s
employment or service, and the circumstances under which Stock Units may be
forfeited.

 

9.                                      Stock
Awards

 

(a)                                  General
Requirements. The Committee may issue shares of Company Stock to an
Employee or Non-Employee Director under a Stock Award, upon such terms and
conditions as the Committee deems appropriate under this Section 9.  Shares of Company Stock issued pursuant to
Stock Awards may be issued for cash consideration or for no cash consideration,
and subject to restrictions or no restrictions, as determined by the Committee.  The Committee may establish conditions under
which restrictions on Stock Awards shall lapse over a period of time or
according to such other criteria as the Committee deems appropriate, including
restrictions based upon the achievement of specific performance goals.  The Committee shall determine the number of
shares of Company Stock to be issued pursuant to a Stock Award.

 

(b)           Requirement
of Employment or Service.  The
Committee shall determine in the Grant Agreement under what circumstances a
Participant may retain Stock Awards after termination of the Participant’s
employment or service, and the circumstances under which Stock Awards may be
forfeited.

 

(c)           Restrictions
on Transfer.  While Stock Awards are
subject to restrictions, a Participant may not sell, assign, transfer, pledge
or otherwise dispose of the shares of a Stock Award except upon death as
described in Section 15(a).  Each
certificate for a share of a Stock Award shall contain a legend giving
appropriate notice of the restrictions in the Grant.  The Participant shall be entitled to have the
legend removed when all restrictions on such shares have lapsed.  The Company may retain possession of any
certificates for Stock Awards until all restrictions on such shares have
lapsed.

 

(d)           Right
to Vote and to Receive Dividends. 
The Committee shall determine to what extent, and under what conditions,
the Participant shall have the right to vote shares of Stock Awards and to
receive any dividends or other distributions paid on such shares during the
restriction period.

 

9

 

10.                               Stock
Appreciation Rights and Other Stock-Based Awards

 

(a)                                  SARs.  The Committee may grant SARs to an Employee
or Non-Employee Director separately or in tandem with an Option.  The following provisions are applicable to
SARs:

 

(i)            Base
Amount.  The Committee shall
establish the base amount of the SAR at the time the SAR is granted.  The base amount of each SAR shall be equal to
the per share Exercise Price of the related Option or, if there is no related
Option, an amount that is at least equal to the Fair Market Value of a share of
Company Stock as of the date of Grant of the SAR.

 

(ii)           Tandem
SARs.  The Committee may grant tandem
SARs either at the time the Option is granted or at any time thereafter while
the Option remains outstanding; provided, however, that, in the case of an
Incentive Stock Option, SARs may be granted only at the date of the grant of
the Incentive Stock Option.  In the case
of tandem SARs, the number of SARs granted to a Participant that shall be exercisable
during a specified period shall not exceed the number of shares of Company
Stock that the Participant may purchase upon the exercise of the related Option
during such period.  Upon the exercise of
an Option, the SARs relating to the Company Stock covered by such Option shall
terminate.  Upon the exercise of SARs,
the related Option shall terminate to the extent of an equal number of shares
of Company Stock.

 

(iii)          Exercisability.  An SAR shall be exercisable during the period
specified by the Committee in the Grant Agreement and shall be subject to such
vesting and other restrictions as may be specified in the Grant Agreement.  The Committee may grant SARs the exercise of
which is subject to achievement of performance goals or other conditions.  The Committee may accelerate the
exercisability of any or all outstanding SARs at any time for any reason.  The Committee shall determine in the Grant
Agreement under what circumstances and during what periods a Participant may
exercise an SAR after termination of employment or service.  A tandem SAR shall be exercisable only while
the Option to which it is related is exercisable.

 

(iv)          Grants
to Non-Exempt Employees.  SARs
granted to persons who are non-exempt employees under the Fair Labor Standards
Act of 1938, as amended, may not be exercisable for at least six months after
the date of grant (except that such SARs may become exercisable, as determined
by the Committee, upon the Participant’s death, Disability or retirement, or
upon a Change in Control or other circumstances permitted by applicable
regulations).

 

(v)           Value
of SARs.  When a Participant
exercises SARs, the Participant shall receive in settlement of such SARs an
amount equal to the value of the stock appreciation for the number of SARs
exercised.  The stock appreciation for an
SAR is the amount by which the Fair Market Value of the underlying Company
Stock on the date of exercise of the SAR exceeds the base amount of the SAR as
described in subsection (i).

 

(vi)          Form of
Payment.  The Committee shall
determine whether the stock appreciation for an SAR shall be paid in the form
of shares of Company Stock, cash or a 

 

10

 

combination of the two.  For
purposes of calculating the number of shares of Company Stock to be received,
shares of Company Stock shall be valued at their Fair Market Value on the date
of exercise of the SAR.  If shares of
Company Stock are to be received upon exercise of an SAR, cash shall be
delivered in lieu of any fractional share.

 

(b)           Other
Stock-Based Awards.  The Committee
may grant other awards not specified in Sections 7, 8 or 9 or subsection (a) above
that are based on or measured by Company Stock to Employees and Non-Employee
Directors, on such terms and conditions as the Committee deems
appropriate.  Other Stock-Based Awards
may be granted subject to achievement of performance goals or other conditions
and may be payable in Company Stock or cash, or in a combination of the two, as
determined by the Committee in the Grant Agreement.

 

11.          Dividend Equivalents.

 

(a)           General
Requirements.  When the Committee
makes a Grant under the Plan, the Committee may grant Dividend Equivalents in
connection with the Grant, under such terms and conditions as the Committee
deems appropriate under this Section 11. 
Dividend Equivalents may be paid to Participants currently or may be
deferred, as determined by the Committee. 
All Dividend Equivalents that are not paid currently shall be credited
to bookkeeping accounts on the Company’s records for purposes of the Plan.  Dividend Equivalents may be accrued as a cash
obligation, or may be converted to Stock Units for the Participant, and
deferred Dividend Equivalents may accrue interest, all as determined by the
Committee.  The Committee may provide
that Dividend Equivalents shall be payable based on the achievement of specific
performance goals.

 

(b)           Payment
with Respect to Dividend Equivalents. 
Dividend Equivalents may be payable in cash or shares of Company Stock
or in a combination of the two, as determined by the Committee.

 

12.                               Qualified
Performance-Based Compensation

 

(a)                                  Designation
as Qualified Performance-Based Compensation.  The Committee may determine that Stock Units,
Stock Awards, Dividend Equivalents or Other Stock-Based Awards granted to an
Employee shall be considered “qualified performance-based compensation” under
section 162(m) of the Code, in which case the provisions of this Section 12
shall apply.  The Committee may also
grant Options or SARs under which the exercisability of the Options is subject
to achievement of performance goals as described in this Section 12 or
otherwise.

 

(b)                                 Performance
Goals.  When Grants are made under
this Section 12, the Committee shall establish in writing (i) the
objective performance goals that must be met, (ii) the period during which
performance will be measured, (iii) the maximum amounts that may be paid
if the performance goals are met, and (iv) any other conditions that the
Committee deems appropriate and consistent with the requirements of section 162(m) of
the Code for “qualified performance-based compensation.”  The performance goals shall satisfy the
requirements for “qualified performance-based compensation,” including the
requirement that the achievement of the goals 

 

11

 

be substantially uncertain at the time they are established and that
the performance goals be established in such a way that a third party with
knowledge of the relevant facts could determine whether and to what extent the
performance goals have been met.  The
Committee shall not have discretion to increase the amount of compensation that
is payable, but may reduce the amount of compensation that is payable, pursuant
to Grants identified by the Committee as “qualified performance-based
compensation.”

 

(c)           Criteria
Used for Objective Performance Goals. 
The Committee shall use objectively determinable performance goals based
on one or more of the following criteria: 
stock price, earnings per share, price-earnings multiples, net earnings,
operating earnings, revenue, number of days sales outstanding in accounts
receivable, productivity, margin, EBITDA (earnings before interest, taxes,
depreciation and amortization), net capital employed, return on assets,
shareholder return, return on equity, return on capital employed, growth in
assets, unit volume, sales, cash flow, market share, relative performance to a
comparison group designated by the Committee, or strategic business criteria
consisting of one or more objectives based on meeting specified revenue goals,
market penetration goals, customer growth, geographic business expansion goals,
cost targets or goals relating to acquisitions or divestitures.  The performance goals may relate to one or
more business units or the performance of the Company as a whole, or any
combination of the foregoing. 
Performance goals need not be uniform as among Participants.

 

(d)           Timing
of Establishment of Goals. The Committee shall establish the performance
goals in writing either before the beginning of the performance period or
during a period ending no later than the earlier of (i) 90 days after the
beginning of the performance period or (ii) the date on which 25% of the
performance period has been completed, or such other date as may be required or
permitted under applicable regulations under section 162(m) of the Code.

 

(e)           Certification
of Results.  The Committee shall
certify the performance results for the performance period specified in the
Grant Agreement after the performance period ends.  The Committee shall determine the amount, if
any, to be paid pursuant to each Grant based on the achievement of the
performance goals and the satisfaction of all other terms of the Grant
Agreement.

 

(f)            Death,
Disability or Other Circumstances. 
The Committee may provide in the Grant Agreement that Grants under this Section 12
shall be payable, in whole or in part, in the event of the Participant’s death
or disability, a Change in Control or under other circumstances consistent with
the Treasury regulations and rulings under section 162(m) of the Code.

 

13.          Deferrals

 

The Committee may permit
or require a Participant to defer receipt of the payment of cash (including
dividend equivalents) or the delivery of shares that would otherwise be due to
the Participant in connection with any Grant. 
The Committee shall establish rules and procedures for any such
deferrals, consistent with applicable requirements of section 409A of the Code.

 

12

 

14.                               Withholding
of Taxes

 

(a)           Required
Withholding.  All Grants under the
Plan shall be subject to applicable federal (including FICA), state and local
tax withholding requirements.  The
Company may require that the Participant or other person receiving or
exercising Grants pay to the Company the amount of any federal, state or local
taxes that the Company is required to withhold with respect to such Grants, or
the Company may deduct from other wages paid by the Company the amount of any
withholding taxes due with respect to such Grants.

 

(b)           Election
to Withhold Shares.  If the Committee
so permits, a Participant may elect to satisfy the Company’s tax withholding
obligation with respect to Grants paid in Company Stock by having shares
withheld, at the time such Grants become taxable, up to an amount that does not
exceed the minimum applicable withholding tax rate for federal (including
FICA), state and local tax liabilities. 
The election must be in a form and manner prescribed by the Committee.

 

15.                               Transferability
of Grants

 

(a)                                  Restrictions
on Transfer.  Except as described in
subsection (b) below, only the Participant may exercise rights under a
Grant during the Participant’s lifetime, and a Participant may not transfer
those rights except by will or by the laws of descent and distribution.  When a Participant dies, the personal
representative or other person entitled to succeed to the rights of the
Participant may exercise such rights. 
Any such successor must furnish proof satisfactory to the Company of his
or her right to receive the Grant under the Participant’s will or under the
applicable laws of descent and distribution.

 

(b)                                 Transfer
of Nonqualified Stock Options to or for Family Members.  Notwithstanding subsection (a) above,
the Committee may provide, in a Grant Agreement, that a Participant may
transfer Nonqualified Stock Options to family members, or one or more trusts or
other entities for the benefit of or owned by family members, consistent with
the applicable securities laws, according to such terms as the Committee may
determine; provided that the Participant receives no consideration for the
transfer of an Option and the transferred Option shall continue to be subject
to the same terms and conditions as were applicable to the Option immediately
before the transfer.

 

16.                               Consequences
of a Change in Control

 

(a)                                  In
the event of a Change in Control, the Committee may take any one or more of the
following actions with respect to some or all outstanding Grants, without the
consent of any Participant: (i) the Committee may determine that
outstanding Options and SARs shall be fully exercisable, and restrictions on
outstanding Stock Awards and Stock Units shall lapse, as of the date of the
Change in Control or at such other time as the Committee determines, (ii) the
Committee may require that Participants surrender their outstanding Options and
SARs in exchange for one or more payments by the Company, in cash or Company
Stock as determined by the Committee, in an amount equal to the amount by which
the then Fair Market Value of the shares of Company Stock subject to the
Participant’s unexercised Options and SARs exceeds the 

 

13

 

Exercise Price, or Base Amount, as applicable, if any, and on such
terms as the Committee determines, (iii) after giving Participants an
opportunity to exercise their outstanding Options and SARs, the Committee may
terminate any or all unexercised Options and SARs at such time as the Committee
deems appropriate, (iv) with respect to Participants holding Stock Units,
Other Stock-Based Awards or Dividend Equivalents, the Committee may determine
that such Participants shall receive one or more payments in settlement of such
Stock Units, Other Stock-Based Awards or Dividend Equivalents, in such amount
and form and on such terms as may be determined by the Committee, (v) if
the Company is the surviving corporation, the Committee may determine that
Grants will remain outstanding after the Change in Control, or (vi) if the
Company is not the surviving corporation, the Committee may determine that
Grants that remain outstanding after the Change in Control shall be converted
to similar grants of the surviving corporation (or a parent or subsidiary of
the surviving corporation).  Such
acceleration, surrender, termination, settlement or conversion shall take place
as of the date of the Change in Control or such other date as the Committee may
specify.

 

(b)                                 Other
Transactions.  The Committee may
provide in a Grant Agreement that a sale or other transaction involving a
subsidiary or other business unit of the Company shall be considered a Change
in Control for purposes of a Grant, or the Committee may establish other
provisions that shall be applicable in the event of a specified transaction.

 

17.                               Requirements
for Issuance of Shares

 

No Company Stock shall be
issued in connection with any Grant hereunder unless and until all legal
requirements applicable to the issuance of such Company Stock have been
complied with to the satisfaction of the Committee.  The Committee shall have the right to
condition any Grant made to any Participant hereunder on such Participant’s
undertaking in writing to comply with such restrictions on his or her
subsequent disposition of such shares of Company Stock as the Committee shall
deem necessary or advisable, and certificates representing such shares may be
legended to reflect any such restrictions. 
Certificates representing shares of Company Stock issued under the Plan
will be subject to such stop-transfer orders and other restrictions as may be
required by applicable laws, regulations and interpretations, including any
requirement that a legend be placed thereon. 
Except as determined under Section 9(a), no Participant shall have
any right as a shareholder with respect to Company Stock covered by a Grant
until shares have been issued to the Participant.

 

18.                               Amendment
and Termination of the Plan

 

(a)                                  Amendment.  The Board may amend or terminate the Plan at
any time; provided, however, that the Board shall not amend the Plan without
approval of the stockholders of the Company if such approval is required in
order to comply with the Code or applicable laws, or to comply with applicable
stock exchange requirements.  No
amendment or termination of this Plan shall, without the consent of the Participant,
materially impair any rights or obligations under any Grant previously made to
the Participant under the Plan, unless such right has been reserved in the Plan
or the Grant Agreement, or except as provided in Section 19(b) below.  Notwithstanding anything in the Plan to the
contrary, the Board may amend the Plan in such manner as it deems appropriate
in the event of a change in applicable law or regulations.

 

14

 

(b)           No
Repricing Without Stockholder Approval. 
Notwithstanding anything in the Plan to the contrary, the Committee may
not reprice Options, nor may the Board amend the Plan to permit repricing of
Options, unless the stockholders of the Company provide prior approval for such
repricing.  The term “repricing” shall
have the meaning given that term in Section 303A(8) of the New York
Stock Exchange Listed Company Manual, as in effect from time to time.

 

(c)           Stockholder
Approval for “Qualified Performance-Based Compensation.”  If Grants are made under Section 12
above, the Plan must be reapproved by the Company’s stockholders no later than
the first stockholders meeting that occurs in the fifth year following the year
in which the stockholders previously approved the provisions of Section 12,
if additional Grants are to be made under Section 12 and if required by
section 162(m) of the Code or the regulations thereunder.

 

(d)           Termination
of Plan.  The Plan shall terminate on
May 7, 2017, unless the Plan is terminated earlier by the Board or is
extended by the Board with the approval of the stockholders.  The termination of the Plan shall not impair
the power and authority of the Committee with respect to an outstanding Grant.

 

19.                               Miscellaneous

 

(a)                                  Grants
in Connection with Corporate Transactions and Otherwise.  Nothing contained in this Plan shall be
construed to (i) limit the right of the Committee to make Grants under
this Plan in connection with the acquisition, by purchase, lease, merger,
consolidation or otherwise, of the business or assets of any corporation, firm
or association, including Grants to employees thereof who become Employees, or
for other proper corporate purposes, or (ii) limit the right of the
Company to grant stock options or make other stock-based awards outside of this
Plan.  Without limiting the foregoing,
the Committee may make a Grant to an employee of another corporation who
becomes an Employee by reason of a corporate merger, consolidation, acquisition
of stock or property, reorganization or liquidation involving the Company in
substitution for a grant made by such corporation.  The terms and conditions of the Grants may
vary from the terms and conditions required by the Plan and from those of the
substituted stock incentives, as determined by the Committee

 

(b)                                 Compliance
with Law.  The Plan, the exercise of
Options and the obligations of the Company to issue or transfer shares of
Company Stock under Grants shall be subject to all applicable laws and to
approvals by any governmental or regulatory agency as may be required.  With respect to persons subject to section 16
of the Exchange Act, it is the intent of the Company that the Plan and all
transactions under the Plan comply with all applicable provisions of Rule 16b-3
or its successors under the Exchange Act. 
In addition, it is the intent of the Company that Incentive Stock
Options comply with the applicable provisions of section 422 of the Code, that
Grants of “qualified performance-based compensation” comply with the applicable
provisions of section 162(m) of the Code and that, to the extent
applicable, Grants are either exempt from, or comply with, the requirements of
section 409A of the Code.  To the extent
that any legal requirement of section 16 of the Exchange Act or section 422,
162(m) or 409A of the Code as set forth in the Plan ceases to be required
under section 16 of the Exchange Act or section 422, 

 

15

 

162(m) or 409A of the Code, that Plan provision shall cease to
apply.  The Committee may revoke any
Grant if it is contrary to law or modify a Grant to bring it into compliance
with any valid and mandatory government regulation.  The Committee may also adopt rules regarding
the withholding of taxes on payments to Participants.

 

(c)           Enforceability.  The Plan shall be binding upon and
enforceable against the Company and its successors and assigns.

 

(d)           Funding
of the Plan; Limitation on Rights. 
This Plan shall be unfunded.  The
Company shall not be required to establish any special or separate fund or to
make any other segregation of assets to assure the payment of any Grants under
this Plan.  Nothing contained in the Plan
and no action taken pursuant hereto shall create or be construed to create a
fiduciary relationship between the Company and any Participant or any other
person.  No Participant or any other
person shall under any circumstances acquire any property interest in any
specific assets of the Company.  To the
extent that any person acquires a right to receive payment from the Company
hereunder, such right shall be no greater than the right of any unsecured
general creditor of the Company.

 

(e)           Rights
of Participants.  Nothing in this
Plan shall entitle any Employee, Non-Employee Director or other person to any
claim or right to receive a Grant under this Plan.  Neither this Plan nor any action taken
hereunder shall be construed as giving any individual any rights to be retained
by or in the employment or service of the Employer.

 

(f)            No
Fractional Shares.  No fractional
shares of Company Stock shall be issued or delivered pursuant to the Plan or
any Grant.  The Committee shall determine
whether cash, other awards or other property shall be issued or paid in lieu of
such fractional shares or whether such fractional shares or any rights thereto
shall be forfeited or otherwise eliminated.

 

(g)           Employees
Subject to Taxation Outside the United States.  With respect to Participants who are subject
to taxation in countries other than the United States, the Committee may make
Grants on such terms and conditions as the Committee deems appropriate to
comply with the laws of the applicable countries, and the Committee may create
such procedures, addenda and subplans and make such modifications as may be
necessary or advisable to comply with such laws.

 

(h)           Governing
Law.  The validity, construction,
interpretation and effect of the Plan and Grant Agreements issued under the
Plan shall be governed and construed by and determined in accordance with the
laws of the State of New York, without giving effect to the conflict of laws provisions
thereof.

 

16

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00137-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00137-of-00352.parquet"}]]