As discussed previously, the “Stock Awards” amounts for 2016 and 2015 reflect primarily performance-contingent award opportunities that are only earned if specific financial and relative TSR goals are achieved, whereas, the 2014, “Stock Awards” were only subject to continued employment.

⁽²⁾ Grant date fair value is determined by multiplying the number of shares granted by the Market Value (“MV”) on the grant date. MV is determined by the closing price on the date of grant. The MV for the Restricted Stock awards granted to all Named Executive Officers on February 17, 2016 is $16.44, on February 11, 2015 is $17.65, and on October 1, 2014 is $15.37. The target Performance Share awards that are based on financial measures were valued using the closing stock price on the date of grant, discounted because these shares are not eligible for dividends. The resulting value for the 2016 grant on February 17, 2016 is $15.85, and for the 2015 grant on May 6, 2015 is $16.31. The target Performance Share awards that are based on the relative TSR measure are valued using a Monte Carlo valuation method, effective the date of grant. The value for the 2016 grant on February 17, 2016 is $19.73, and for the 2015 grant on May 6, 2015 is $16.01. Please reference the Company’s 2016~~10-K~~ filing for details of the assumptions used in the Monte Carlo valuation. The MV for the September 15, 2014 grant to Mr. Thirot is $17.03 and the grant to Mr. Quigley on November 10, 2014 is $15.63.

⁽³⁾ The maximum number of shares and award value for Performance Share awards for the 2016-2018 performance period is 200% of target shares granted. The table below shows the maximum number of shares and value based on the values of $15.85 for Performance Share awards based on financial measures, and $19.73 for Performance Share awards based on the relative TSR measure, as explained in the previous footnote.

⁽⁴⁾ Amounts for Named Executive Officers (other than Mr. Thirot) include premiums paid for life insurance, dividends on unvested restricted shares, company matching contributions to the MRP, and Medicare tax~~gross-ups~~ on those MRP contributions. (See table below.) No highly compensated employees as outlined by Section 414(q)(1)(B)(i) of the Internal Revenue Code, including the Named Executive Officers, are eligible to participate in the Company’s~~tax-qualified~~ retirement plan. Company contributions to the MRP include the Company match on participant deferrals as explained in the Retirement Benefits section of this document. The total value of perquisites provided to each Named Executive Officer (other than Mr. Thirot) in 2016 was less than $10,000 and, in accordance with reporting regulations, were not required to be included here.

⁽⁵⁾ The amount reported for Mr. Thirot includes his representation allowance, supplemental health care allowance, and a supplemental contribution to the government-mandated occupational pension benefit program paid through Swiss payroll; dividend equivalents paid to Mr. Thirot during 2016; the value of unused Swiss vacation time paid to Mr. Thirot in December 2016 as a result of his moving from Swiss payroll and benefits to U.S. payroll and benefits effective January 1, 2017; the incremental cost of his personal use of the Company-owned vacation property in 2016; the cost of his executive physical; and the following costs associated with his international assignment from Switzerland to the U.S.: tax preparation fee of $13,183, visa support expense: $3,999, credit for repayment of home leave in the amount of $2,634, and tax~~gross-ups/payments,~~ net of tax recoveries (from prior years received in 2016) of US federal and Michigan state taxes made by the Company on Mr. Thirot’s behalf under the Company’s tax equalization policy totaling $648,386. Final tax recoveries related to the 2016 reporting year will be reflected in the future reporting year in which the 2016 tax obligation is finalized.

⁽⁶⁾ ~~Amounts reported for Mr. Thirot are converted from Swiss francs to U.S. dollars at an exchange rate of 1 CHF = 1.0369 USD. This is the rate used by the Company for budgeting purposes in 2016.~~

⁽¹⁾ ~~The Company did not grant stock options during the 2016 fiscal year. Accordingly, this column has been eliminated from the table.~~

⁽²⁾ ~~Long-Term incentive grants to Named Executive Officers, consisting of Restricted Shares and Performance Shares, were approved by the Committee at its February 17, 2016 meeting.~~

⁽³⁾ Payout for threshold performance under the STIP is 50% of target opportunity for Messrs. Camden, Corona, Quigley, and Thirot. 2016 STIP payouts for each of these Named Executive Officers were based 100% on corporate measures and goals. Additional business unit measures are included in the 2016 STIP goals for Ms. Carroll, that have payouts for threshold performance equal to 20% of her target opportunity. Therefore, the weighted average payout for all measures at a threshold level of performance is equal to 29% of her target opportunity. For the corporate measures, each additional increment above the threshold earns prorated incentive payments up to the maximum as discussed in the Compensation Discussion and Analysis in the Annual Cash Incentive section. For Ms. Carroll’s business unit measures, there is no prorating between payout levels of the payout schedule. STIP maximum payout for all Named Executive Officers is 200% of target opportunity with an individual maximum payout of no more than $3,000,000 as required under the terms of the amended and restated STIP, effective February 12, 2015.

⁽⁴⁾ Performance Shares granted in 2016 are earned based upon achievement of three financial measures and a relative TSR measure. These four measures are equally weighted. Achievement of a threshold level of performance on any measure results in 50% of the target shares being earned. Achievement of the maximum level of performance on any measure results in 200% of the target shares being earned by the Named Executive Officer.

⁽⁵⁾ ~~Restricted Stock Awards granted February 17, 2016 vest ratably on each of the first four anniversaries of the date of grant (25% per year).~~

⁽⁶⁾ Grant date fair value is determined by multiplying the number of shares granted by the MV on the grant date. MV is determined by the closing price on the date of grant. The MV for the Restricted Stock awards granted on February 17, 2016 is $16.44. The target Performance Share awards that are based on financial measures were valued using the closing stock price on the date of grant, February 17, 2016, discounted because these shares are not eligible for dividends, resulting in a value of $15.85. The target Performance Share awards that are based on the relative TSR measure were valued at $19.73 using a Monte Carlo valuation method, effective the date of grant, February 17, 2016.

⁽¹⁾ The Company did not grant stock options during the 2016 fiscal year. All previously outstanding granted stock options for the Named Executive Officers expired during the 2014 fiscal year. As a result, there are no outstanding options to report and, accordingly, these columns have been eliminated from the table.

⁽²⁾ ~~All outstanding restricted stock grants vest ratably over 4 years. The number of outstanding shares has been determined as of December 31, 2016.~~

⁽³⁾ ~~2015 total includes performance shares earned based upon the level of achievement for both financial measures for 2015. These shares will vest in early 2018.~~

⁽⁴⁾ ~~The market value is determined based on the closing market price of our common shares on the last trading day of the 2016 fiscal year, December 30, 2016 ($22.92).~~

⁽⁵⁾ 2015 performance shares that are based upon achievement of the relative TSR measure, whose performance will not be known until early 2018 at the end of the three year performance period 2015-2017. 2016 performance shares that are based upon achievement of financial measures and the relative TSR measures based on the performance period 2016-2018, as explained in the Long-Term Incentives section of this Proxy Statement. Threshold levels are shown here.

⁽¹⁾ ~~Value Realized on Vesting is calculated by multiplying the shares vested times the stock closing price on the day of vesting.~~

⁽¹⁾ Executives may defer a percentage of their base salary (up to 25%) and annual incentive earnings (up to 50%) for retirement. These amounts, as applicable, are reported as a part of the salary or incentive earnings found in the Summary Compensation Table.

⁽²⁾ Registrant Contributions in Last Fiscal Year above represent Company matching contributions (50% of the first 10% of salary and annual incentive deferrals), and they are also reported as All Other Compensation in the Summary Compensation Table.

⁽³⁾ Represents actual earnings from the investment of the prior year aggregate balance plus the earnings on current year executive and Company contributions. The aggregate earnings are based on investment options that are also offered to employees who participate in the Company’s~~tax-qualified~~ ~~401(k) plan and are not “above market”; therefore, they are not included in the Summary Compensation Table.~~

⁽⁴⁾ ~~Participants may elect to receive distributions after separation from service, the later of a specified age and separation of service or a scheduledin-service~~ ~~distribution. Amounts may be paid as a lump sum, monthly installments for up to 20 years, or a combination of the two as elected by the participant. Ms. Carroll received a scheduledin-service~~ ~~distribution from her account in 2016.~~

⁽⁵⁾ Amounts reported in this column include the following amounts that have been reported in the Summary Compensation Table for fiscal years 2006-2016: Carl T. Camden ($2,429,395), George S. Corona ($1,091,837); named in the proxies for fiscal years 2013 - 2016: Peter W. Quigley ($432,218); named in the proxies for fiscal years 2015 - 2016: Teresa S. Carroll ($372,711).

This section describes the potential additional payments and benefits under our compensation and benefit plans and arrangements to which the Named Executive Officers would be entitled upon termination of employment under certain circumstances. Named Executive Officers would also be entitled to vested benefits and generally available benefits under our various plans and arrangements, as discussed after the Potential Payments Upon Termination table. The Company does not maintain employment agreements with our Named Executive Officers. The Company did not provide special protections or benefits under any of our compensation or benefits plans upon a change in control or upon a termination following a change in control during 2016. Messrs. Camden and Corona participate in the Executive Severance Plan as described in detail below. The table following the narrative discussion summarizes the amounts payable upon termination under certain circumstances to our ~~current~~ Named Executive Officers, assuming that the executive’s employment terminated on ~~January 1,~~December 31, 2017, the last day of our fiscal year.

The Company ~~maintains an~~implemented the Senior Executive Severance ~~plan~~Plan (“Severance Plan”) for a limited number of Executive ~~Officers.~~Officers in March 2017. Messrs. ~~Camden~~Corona, Thirot and ~~Corona~~Quigley, and Ms. Carroll are the only ~~remaining~~ participants in the plan. ~~The~~Described below and illustrated in the table, ~~below reflects~~Potential Payouts Upon Termination, are the different elements payable under the Severance Plan if a Named Executive Officer who is a party to the Severance Plan would experience a qualifying termination. All continuation amounts would be paid over the salary continuation period in compliance with Section ~~409A. Messrs. Quigley and Thirot, and Ms. Carroll are not participants~~409A of the Code. Mr. Armstrong participates in the ~~Executive~~General Severance Plan. Severance benefits for Mr. Quigley and Ms. Carroll, if any, would have been determined at the discretion of the Compensation Committee based upon the individual facts and circumstances at the time of their separation from the Company. Separation benefits for Mr. Thirot during 2016 were definedPlan as outlined in the ~~terms~~next section.

If the eligible Named Executive ~~Officer~~Officers were to have experienced a qualifying termination under the Severance Plan in ~~2016,~~2017, the Named Executive Officer would have been entitled to ~~a payment that is~~severance benefits based on the ~~target incentive amount established under~~type of qualified termination and whether they were a Tier 1 or a Tier 2 participant. Mr. Corona is the ~~Company’s~~only Tier 1 participant in the Severance Plan. Messrs. Thirot and Quigley, and Ms. Carroll are Tier 2 participants in the Severance Plan. A “qualified termination” is any termination of a participant’s employment: by the Company other than for cause, disability or death; or for “good reason” by a participant in connection with a change in control.

For a qualified termination that occurs not in connection with a change in control, a Tier 1 participant would receive severance payments in the form of base salary continuation for a period of twenty-four months, and a Tier 2 participant would receive severance payments in the form of base salary continuation for a period of eighteen months. In addition, Tier 1 and Tier 2 participants would receive a prorated portion of their annual incentive ~~plan~~compensation for the fiscal year in which the ~~Named Executive Officer’s~~ termination ~~occurs. This payment would~~occurred, based on the actual performance results for the year. The pro rata annual incentive payout will be ~~adjusted~~determined based on a~~pro-rata~~ ~~basis according to~~ the number of calendar days the eligible Named Executive Officer was actually employed during such plan year. ~~In February 2017,~~Prorated annual incentive awards are paid at the same time that incentive compensation for the same year are paid to the other Senior Officers of the Company, following certification by the Committee ~~approved an amendment to the plan~~ that ~~provides for a payment, if any, that is based on actual~~applicable performance achieved under the Company’s annual incentive plan for the year in which the eligible Named Executive Officer’s termination occurs, and not the target incentive amount. The Named Executive Officer would not be eligible to receive a payment under the terms of the STIP for the year in which his/her termination occurs, or for a recently completed performance year if termination occurs before incentive payments are made, since a participant must be employed on the date the STIP award is paid following the completion of the performance period.

~~The eligible Named Executive Officer would receive salary~~goals have been attained. Salary continuation payments in an amount equal to such multiple as may be identified in the Severance Plan times the Named Executive Officer’s base salary. Mr. Camden is eligible for a severance multiple of two and Mr. Corona is eligible for a severance multiple of one. Only Mr. Camden is eligible to receive incentive continuation payments, that are based on his target STIP amount and severance multiple of two. The combination of salary continuation (and incentive continuation if applicable) amounts would be paid by the Company in installments over the severance period and in accordance with the Company’s standard payroll practice, subject to the requirements of Section 409A. ~~The~~

For a qualified termination that occurs in connection with a change in control, a Tier 1 participant would receive a single lump sum severance payment equal to two (2) times the sum of the participant’s annual base salary and target annual incentive compensation. A Tier 2 participant would receive a single lump sum severance payment equal to one and one-half (1.5) times the sum of the participant’s annual base salary and target annual incentive compensation. In addition, Tier 1 and Tier 2 participants would receive a prorated portion of their annual incentive compensation. If the qualifying termination occurred in the same year as the change in control, a prorated portion of the participant’s annual incentive compensation is paid based on achievement of a target level of performance. If the qualifying termination occurred in the two years following a change in control, a prorated portion of the participant’s annual incentive compensation is paid based on the actual performance results achieved for the year. Any pro rata annual incentive payout will be determined based on the number of calendar days the eligible Named Executive Officer was actually employed during such plan year. Prorated annual incentive awards are paid in a lump sum at the same time that incentive compensation for the same year are paid to the other Senior Officers of the Company, following certification by the Committee that applicable performance goals have been attained.

Subject to the participant’s timely election of continued coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), the Company would provide comparable medical (including prescription drug), dental, vision, and hospitalization benefits to the eligible Named Executive Officer and his or her eligible dependents for the severance period, provided the Named Executive Officer continues to pay the applicable employee rate for such coverage and the Named Executive Officer remains eligible for COBRA coverage. The severance period for a Tier 1 participant is 24 months and for a Tier 2 participant is 18 months.

The eligible Named Executive Officer will be entitled to receive reimbursement for professional outplacement services actually incurred during the initial12-month period following termination, not to exceed $10,000.

The eligible Named Executive Officers, as a condition to receiving payments under the Severance Plan, are required to agree not to directly or indirectly, individually or in any capacity or relationship, engage in any business or employment, or aid or endeavor to assist any business or legal entity, that is in direct competition with the business of the Company for the 12 months following termination.

During ~~this period,~~the 12 months following termination, the eligible Named Executive Officers must also agree to not induce any employee of the Company to terminate employment with the Company, nor knowingly offer employment to any person who is or who was employed by the Company unless such person has ceased to be employed by the Company for a period of at least six months.

Named Executive Officers covered under the Severance Plan may not disparage, slander, or injure the business reputation or goodwill of the Company.

Named Executive Officers must maintain as secret and confidential all protected information such as trade secrets, confidential and proprietary business information of the Company, and any other information of the Company, including but not limited to customer lists, sources of supply, processes, plans, materials, pricing information, internal memoranda, marketing plans, internal policies, and products and services which may be developed from time to time by the Company and its agents or employees, including the Named Executive Officer.

Noncompliance with any of the above may result in the loss of severance benefits.

⁽¹⁾ InThe General Severance Plan was amended and restated effective March 27, 2017 to include the ~~event~~Senior Officers who are not covered by the Senior Executive Severance Plan. Mr. Armstrong is the only Named Executive Officer in 2017 who participates in this plan. Described below and illustrated in the table, Potential Payouts Upon Termination, are the different elements payable under the General Severance Plan if Mr. Armstrong would experience an involuntary termination of employment. All continuation amounts would be paid over the salary continuation period in compliance with Section 409A.

If Mr. Armstrong were to have experienced an “involuntary termination of employment” under the General Severance Plan in 2017, he would have been entitled to severance benefits. “Involuntary termination of employment” is defined in the General Severance Plan as the termination of employment of an eligible employee by the employer, other than: for cause; as a result of his or her failure to accept such additional or revised responsibilities as communicated by the employer; by reason of the sale of his employer or any portion of the employer’s assets (whether by asset or stock sale), provided he or she continues employment with the purchaser thereof; or a voluntary termination of employment of any kind.

For an involuntary termination, an eligible employee would receive severance payments in the form of base salary continuation for a period of weeks that is determined based on his or her job title/level and years of service. Mr. Armstrong would have been eligible for 48 weeks of severance as of December 31, 2017. Salary continuation amounts would be paid by the Company in installments and in accordance with the Company’s standard payroll practice, subject to the requirements of Section 409A.

Subject to the eligible employee’s timely election of continued coverage under COBRA and the Company’s receipt of the signed severance agreement, the Company would provide comparable medical (including prescription drug), dental, vision, and hospitalization benefits to the eligible Named Executive Officer and his or her eligible dependents for a period of time that is determined based on the number of weeks of severance that the employee is eligible for. The Company pays the full cost of COBRA during the severance period. Following completion of the severance period, the employee is responsible for the full cost of maintaining COBRA benefits. Based on the number of weeks of severance that Mr. Armstrong would have been eligible for, he would have received 12 months of company-paid COBRA premiums.

The eligible Named Executive Officer will be entitled to receive reimbursement for professional outplacement services actually incurred during the initial 6-month period following termination, not to exceed $7,500.

Severance benefits under the General Severance Plan are conditioned upon the terms of the severance agreement that include: non-competition; non-solicitation of employees or customers; maintaining confidentiality of information and trade secrets of the Company and all affiliates; and non-disparagement of the Company and all officers and employees.

Each equity-based award is conditioned upon the grantee’s acceptance of the terms of the EIP and the grant agreement, which includes restrictive covenants such as post-employment conditions not to solicit the Company’s employees or customers and not to compete against the Company for twelve months following any termination of employment, and indefinite covenants covering non-disparagement and confidentiality terms. Each of our Named Executive Officer’s ~~termination of employment due~~performance-based equity awards is subject to ~~disability, death, normal retirement (defined as age 62 with five years of service), or termination by~~ the Company without Cause, at the end of the performance period and following approval by the Compensation Committee, the Named Executive Officer (or the Named Executive Officer’s beneficiary) would receive a pro rata portion of the equity-based Performance Award that would have otherwise vested if employment had continued until the end of the performance period, based on the portion of the performance period that the officerCompany’s Clawback Policy, which was employed and based on the performance level achieved. Amounts shown below are prorated for 2015 performance shares based on financial measures that were earned but not yet vested and a target level of performance shares that are based on the relative TSR measure with performance to be determineddescribed earlier in ~~early 2018, and~~this document. Provisions for the ~~2016 performance shares a prorated target level~~treatment of ~~performance for all measures as performance is not yet known and will be determined at~~long-term incentive awards upon various termination scenarios are outlined in the ~~end of the performance period in early 2019 (assuming the December 30, 2016 stock value of $22.92).~~table below.

⁽²⁾ The value of cash severance includes base salary continuation for Messrs. Camden and Corona, and incentive continuation for Mr. Camden. Base Salary continuation is calculated by taking the annual salary times the relevant severance plan multiple according to the Severance Plan. Incentive continuation is calculated by taking the annual target incentive times the relevant severance plan multiple as provided in the Severance Plan. UnderBased on the terms of Mr. Thirot’s Swiss employment agreement, if he is terminated by the Company, other than for willful misconduct, he will be provided with either three months’ notice or three months of salary in lieu of notice, at the Company’s discretion. The table shows the severance ~~benefit if the Company elects to provide three months~~plans and treatment of ~~salary in lieu of notice.~~

⁽³⁾ ~~The value ofpro-rata~~ ~~target incentive with respect to year of termination represents the calculated target incentive~~LTI awards for the Named Executive Officers if they had terminated on January 1, 2017. If the termination date is other than the last day of the Company’s fiscal year, incentive earned would equal the target incentive prorated for the number of days worked in the year.

⁽⁴⁾ ~~In the event of a Named Executive Officer’s~~each upon termination of employment ~~due to disability, death or termination by~~as outlined above, the ~~Company without Cause, at~~table below illustrates the ~~end of the performance period the~~amounts that each Named Executive Officer ~~(or the Named Executive Officer’s beneficiary)~~ would receive ~~a pro rata portion~~in each of the cash-based Performance Award that would have otherwise vested if employment had continued until the end of the performance period, based on the portion of the performance period that the officer was employed and based on the performance level achieved. Based on Company performance for the three-year 2014-2016 performance period, a threshold level of performance was not achieved for either measure, resulting in no payout.potential termination scenarios.

⁽⁵⁾ The value of the healthcare benefit provided is calculated as the Company-paid portion of the medical plan cost, times the number of months eligible according to the Severance Plan. Costs include medical, dental, and vision (assumes no change in Health Plan or coverage type) and assumes a 10% health care coverage cost increase in second year (as applicable).

2017 Executive ~~continues to make normal employee contributions during the severance period.~~Compensation Tables

⁽⁶⁾ ~~Represents the maximum allowed benefit for reimbursement of outplacement services for participants in the Severance Plan.~~

⁽⁷⁾ ~~In the event of a Named Executive Officer’s termination of employment due to disability or death, the Named Executive Officer (or the Named Executive Officer’s beneficiary) would receive apro-rata~~ settlement of unvested restricted stock outstanding at the time of termination. For each grant of restricted stock, the number of restricted shares settled would equal the total number of restricted shares originally granted times the ratio of days employed since the grant date divided by total number of days in the vesting period less the number of restricted shares already settled on the anniversary dates of the grant. The value of this~~pro-rata~~ ~~settlement (assuming the December 30, 2016 stock value of $22.92) is shown in the table.~~

The Named Executive Officers would also be entitled to the vested benefits included in the Outstanding Equity Awards at FiscalYear-End table and the Nonqualified Deferred Compensation table. In addition, the amounts shown in the table above do not include payments and benefits to the extent they are provided on anon-discriminatory basis to salaried employees generally upon termination of employment or certain types of termination of employment. These include accrued salary and vacation pay, and life insurance benefits.

As required by Section 953(b) of Dodd-Frank and Item 402(u) of Regulation S-K, we are providing the required information about the relationship of the annual total compensation of our employees and the annual total compensation of Mr. Corona, our President and Chief Executive Officer (the “CEO”), as follows:

The pay ratio is a reasonable estimate calculated in a manner consistent with SEC rules based on our payroll and employment records and the methodology described below. The SEC rules for determining the employee population and identifying the median employee provide companies with flexibility surrounding the elements of compensation to be included and various methodologies for gathering the employee population for inclusion in the analysis. The pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies may have different employment and compensation practices, and may utilize different methodologies, exclusions, estimates, samplings and assumptions in calculating their own pay ratios.

To identify the median of the annual total compensation of all our employees, as well as to determine the annual total compensation of our median employee, the methodology that we used and the material assumptions and adjustments that we used to identify the median and determine annual total compensation are outlined below:

PROPOSAL 3 - ~~ADVISORY VOTE TO APPROVE THE FREQUENCY~~AMENDMENT AND RESTATEMENT OF THE COMPANY’S ~~EXECUTIVE COMPENSATION~~CERTIFICATE OF INCORPORATION TO ELIMINATE CERTAIN OBSOLETE PROVISIONS, TO ELIMINATE A “STAKEHOLDER PROVISION” THAT COULD CONFLICT WITH DELAWARE LAW, AND TO MAKE ADDITIONAL REVISIONS IN THE INTERESTS OF MODERNIZATION

~~The Dodd-Frank Act enables our stockholders~~As described in the “Corporate Governance” section of this Proxy Statement, the Board recently formed a special committee consisting of the independent Directors to ~~indicate how frequently we should seek an advisory vote on the compensation of our named executive officers, as disclosed pursuant~~review and make recommendations to the ~~SEC’s compensation disclosure rules. By voting on this Proposal, stockholders may indicate whether they would prefer an advisory vote on named executive officer compensation on~~Board about governance matters. Upon recommendation of the special committee, the Board approved and adopted, and recommends for stockholder approval, amendments to the Company’s Restated Certificate of Incorporation. These amendments eliminate certain obsolete provisions, eliminate a ~~one year, two year, or three year basis.~~“stakeholder provision” that could conflict with Delaware law, and make additional revisions in the interests of modernization. The amendments are as follows:

~~After careful consideration of this Proposal, our Board of Directors has determined~~

Article TENTH currently requires that the Board, when evaluating any offer of another party to make a tender or exchange offer for any equity security of the Company, to merge or consolidate the Company with another corporation or to acquire all or substantially all of the properties and assets of the Company, give “due consideration to such factors as the Board of Directors ordetermines to be relevant, including without limitation, the ~~Company in any way, the Board of Directors may decide that it is in the best interests of our stockholders~~social, legal and ~~the Company to hold an advisory vote on executive compensation more or less frequently than the option approved by our stockholders.~~

The Company adopted the Kelly Services, Inc. Equity Incentive Plan (the “Plan” or the “Equity Incentive Plan”) in 2005. The Equity Incentive Plan has been amended by action of the Company’s Board of Directors on several occasions since its adoption. The most recent amendment was adopted by the Board of Directors on February 16, 2017, subject to the approval of our stockholders at the 2017 Annual Meeting. The Plan provides for the grant to keyproposed transaction upon employees, ~~andnon-employee~~ ~~directors of the Company of options to purchase shares of Class A stock~~customers, suppliers, and other ~~equity-based awards,~~affected persons, firms and corporations and on the communities in which ~~may include incentive stock options,non-qualified~~ stock options, stock appreciation rights (“SARs”), restricted shares, restricted share units, performance awards denominated in cash amounts, performance shares, performance share units, or other stock-based awards (collectively, “Awards”).

~~The amended and restated Plan sets forth the following changes and requirements:~~

The above changes were made in order to be consistent with current market practices and reflect the Company’s objectives for maintaining a strong alignment between pay and performance. A summary of the principal features of the Equity Incentive Plan is set forth below. This summary is qualified in its entirety by reference to the full text of the Plan, which is attached as Exhibit A to this ~~proxy statement.~~

The Board of Directors is asking the Company’s stockholders to approve the Equity Incentive Plan, as amended and restated. The Plan is intended to allow the Committee to pay compensation that may be exempt under the qualified performance-based compensation exception under Section 162(m) of the Code, if shareholders approve the Plan. Treasury Regulations require stockholder approval of the Plan at least every five years for this purpose. Nasdaq regulations require that shareholders approve the entire plan at least every ten years. It is our intent that approval of the amended and restated Plan satisfy the requirements of both provisions.

~~The following summary outlines the principal features of the Equity Incentive Plan.~~

~~Purpose.~~ The purpose of the Plan is to provide for long-term incentive or other performance related compensation to selected key employees and directors of the Company or an affiliated entity of the Company for their contributions to the Company’s growth and profitability. Such compensation is intended to help the Company attract and retain superior individuals, and to give those individuals shared financial interests with the Company’s stockholders that are believed to positively affect their job performance.

~~Eligibility.~~ The persons who are eligible to receive Awards pursuant to the Plan are key employees and directors of the Company or any affiliated entity of the Company who are designated by the Committee (as defined below) from time to time. The Company estimates that approximately 100 officers would currently be eligible for Awards under the Plan. The Plan also provides for modest discretionary stock awards on an exception basis for employees below the officer level.

~~Administration.~~ The Equity Incentive Plan is administered by the Compensation Committee of the Board or any other committee designated by the Board to establish the necessary performance goals and administer the Plan (the “Committee”). The Committee must be comprised of two or more~~“non-employee”~~ ~~directors within the meaning of Rule16b-3~~ of the SEC. In addition, to the extent that the Company determines it desirable to qualify Awards granted under the Plan as “performance-based compensation” under Code Section 162(m), the Committee must be comprised solely of two or more “outside directors” within the meaning of Code Section 162(m).

The Committee may delegate to the chief executive officer of the Company, if also a director, authority to grant Awards under the Plan to employees who are not required to report transactions in Company stock (“Section 16 Reporting Persons”) or who are not senior vice presidents or officers of higher rank.

~~Award Types.~~ ~~The Equity Incentive Plan permits the Committee to grant, in its discretion, incentive stock options,non-qualified~~ stock options, SARs, restricted shares, restricted share units, performance awards denominated in cash amounts, performance shares, performance share units, additional shares, or other stock-based awards, each of which is described hereafter.

~~Maximum Number of Shares Awardable Under the Plan.~~ ~~The Equity Incentive Plan was designed as aso-called~~ “evergreen” plan in that it did not specify a maximum number of shares of Class A stock that may be issued and made subject to issuance over the life of the Plan. Instead, it provided that, at any given time, the maximum number of shares that may be issued and made subject to future issuance shall equal 15% of the number of shares of Class A stock that were outstanding (exclusive of treasury shares) as of the end of the immediately preceding Company fiscal year (rounded downward if necessary to eliminate fractional shares), reduced to take into account various Awards made during the period consisting of the immediately preceding four complete fiscal years of the Companycorporation and its then-current fiscal year to date (the “Adjustment Period”), and increased by the number of shares as to which stock options granted during the Adjustment Period have since expired or terminated for any reason other than exercise of such options or related SARs or by any shares transferred to the Company to satisfy the exercise price of any options. Stock options, SARs and other equity-based Awards assumed by the Company in a merger or acquisition of another company would not count against the shares available for Award under the Plan.

Commencing with the Company’s 2017 shareholders meeting, the maximum number of shares of Company stock that may be issued or delivered pursuant to awards under the Equity Incentive Plan will be 4,700,000. Shares issued or delivered pursuant to an award may be authorized but unissued shares, treasury shares, including shares purchased in the open market, or a combination of the foregoing. With respect to awards granted on or after the Company’s 2017 shareholders meeting, the following shares shall also be available for an award under the Plan: shares covered by an award that expires or is forfeited, canceled, surrendered or otherwise terminated without issuance of such shares and the release of the “substantial risk of forfeiture” under section 83 of the Code, if applicable; shares covered by an award that is settled only in cash; shares granted through the assumption of, or in substitution for, outstanding awards granted by a company to individuals who become employees or directors as the result of a merger, consolidation, acquisition or other corporate transaction involving such company and the Company or any of its affiliates (except as may be required by reason of Section 422 of the Code or the rules and regulations of any stock exchange or other trading market on which the shares are listed); and any shares from awards exercised for or settled in vested and~~non-forfeitable~~ shares that are later returned to the Company pursuant to any compensation recoupment policy, provision or agreement. The following shares issued or delivered under this Plan shall not again be available for grant as described above: shares tendered in payment of the exercise price of an option; shares withheld by the Company or any affiliated entity to satisfy a tax withholding obligation; and shares repurchased by the Company with option proceeds.

In addition, the number of shares covered by outstanding incentive stock options, plus the number of shares issued in settlement of exercised incentive stock options under the Plan, may not exceed 4,000,000 shares.

~~Cash Denominated Award Limits.~~ The maximum amount payable with respect to a cash-denominated performance award to any single employee during any performance period is $2,500,000 multiplied by the number of years included in such performance period. The maximum amount of cash compensation that may be paid, taking any deferrals into account for the year of deferral, to any single director with respect to each twelve-month period beginning with each annual shareholder meeting is $500,000.

~~Equity Awards to Directors.~~The maximum fair market value, as determined on the date of grant, of Company stock that may be granted to any single director with respect to each twelve-month period beginning with each annual shareholder meeting is $500,000.

~~Incentive Stock Options.~~ Incentive stock options entitle the holder to purchase a certain number of shares of Class A stock at an exercise price specified at the time the option is granted. The exercise price per share of Class A stock that may be purchased under an incentive stock option may not be less than 100% of the fair market value of a share of Class A stock on the date the option is granted (110% in the case of certain stockholders). The aggregate fair market value of all shares of Class A stock subject to incentive stock options that become exercisable for the first time during any year may not exceed $100,000.

~~Non-Qualified~~ ~~Stock Options.~~~~Non-qualified~~ stock options, which are stock options that are not incentive stock options, entitle the holder to purchase a certain number of shares of Class A stock at an exercise price which is at least equal to 100% of the fair market value of a share of Class A stock on the date the option is granted.

~~Number of Shares Underlying Options.~~ ~~The maximum number of shares that may be granted as options (whether or not in tandem with SARs) during any consecutive five calendar years to any single employee is 750,000.~~

~~Exercisability of Options.~~ At the time of grant, the Committee will specify the time at which any portion of an option first becomes exercisable and the latest date on which the option may be exercised, provided that no option shall be exercisable prior to twelve (12) months of continued service by a grantee following the date of grant, except as otherwise provided in the option award or this Plan for termination of service due to death or disability. The expiration date for any incentive stock option granted to a 10% owner will not be longer than five years after the date of grant, and the expiration date for any other option will not be longer than ten years after the date of grant. The Committee shall determine the disposition of the grant of each option in the event of the death, disability or other termination of employment of an employee or termination of service as a director. The Committee may, in its discretion, accelerate the exercisability of any portion of an option or provide for automatic acceleration of exercisability upon the occurrence of such events as it may specify, such as upon the death or disability of a grantee.

~~Option Price.~~ The Committee will determine the exercise price per share of options but in no event will the exercise price be less than the fair market value of a share of Class A stock on the date the option is granted. Except as otherwise limited by the Committee at the time of grant, payment for shares of Class A stock purchased upon exercise of an option shall be made on the effective date of such exercise by one or a combination of the following means: (1) entirely in cash; (2) by delivery of whole shares of Class A stock owned by the option holder for more than six months on the date of surrender; or (3) pursuant to a cashless exercise program implemented by the Company in connection with the Plan.

~~Restriction on Repricing.~~ Absent stockholder approval, neither the Committee nor the Board of Directors has the authority to reprice any Option or SAR after the date of the initial grant with a lower exercise price in substitution for the original exercise price.

~~SARs.~~ SARs are rights that, when exercised, entitle the holder to the appreciation in value of the number of shares of Class A stock specified in the grant from the date granted to the date exercised. An exercised SAR may be settled in cash or stock, or any combination of cash and stock, as specified by the holder. SARs may be either stand-alone SARs, which are not granted in conjunction with an option, or tandem SARs, which may be granted at the same time as or subsequent to the time that its related option is granted. The exercise price of a tandem SAR will be the exercise price per share under the related option (but not less than the fair market value of a share of Class A stock on the date of the grant of the SAR), and the exercise price per share subject to a stand-alone SAR will not be less than the fair market value of a share of Class A

stock on the effective date of grant of the SAR. No stand-alone SAR shall be exercisable after the expiration of ten (10) years after the effective date of grant of such SAR and no SAR shall be exercisable prior to twelve (12) months of continued service by a grantee following the date of grant, except as otherwise provided in the option award or this Plan for termination of service due to death or disability. A SAR will be exercisable after a grantee’s termination of employment or service to the extent and during such period as determined in the Committee’s discretion, and as set forth in the Award agreement evidencing such SAR. Tandem SARs related to an incentive stock option are exercisable only when the fair market value of a share of Class A stock exceeds the exercise price of the incentive stock option. The maximum number of shares that may be granted in connection with stand-alone SARs during any consecutive five year period to a single employee is 750,000.

~~Restricted Shares.~~ Restricted shares consist of shares of Class A stock issued under the Plan that are subject to certain restrictions established by the Committee, which may include the achievement of performance goals specified by the Committee from a list stated under “Performance Awards to Named Executive Officers” below, which are designated as subject to the requirements of Section 162(m) of the Code. Restricted stock awards may not be disposed of by the recipient until the restrictions imposed by the Committee have lapsed. If a grantee remains an employee or director throughout the restriction period (which may not be less than 12 months), and upon satisfaction of any other restrictions imposed by the Committee, the restricted stock award will become fully vested. If the grantee ceases to be an employee or director during the restriction period due to death or disability, the Award shall be vested in proportion to the then elapsed portion of the restriction period, and the remainder of the Award will be forfeited, unless the Committee determines to waive the forfeiture. If the grantee otherwise ceases to be an employee or director during the restriction period, the Committee shall determine the disposition of the Award. The grantee of restricted shares will receive any cash dividends paid with respect to such shares during the restriction period. Any~~non-cash~~ ~~dividends will be retained by the Company and will be paid upon the vesting of the restricted shares.~~

~~Restricted Share Units.~~ Restricted share units are awards that may consist of Class A stock, cash equivalents of Class A stock, or a combination of both. Payout of a restricted share unit award is subject to certain restrictions established by the Committee, which may include the achievement of performance goals specified by the Committee from a list stated under “Performance Awards to Named Executive Officers” below, which are designated as subject to the requirements of Section 162(m) of the Code. If a grantee remains an employee or director throughout the restriction period (which may not be less than 12 months), and upon satisfaction of any other restrictions imposed by the Committee, the Award shall be settled in cash, whole shares of Class A stock, or a combination of cash and stock, as the Committee shall determine.

~~Number of Shares in connection with Restricted Shares and Restricted Share Units~~. The maximum number of shares subject to restricted shares and restricted share units that may be granted to any employee with respect to a single performance period during any consecutive five calendar years is 750,000.

~~Performance Awards Generally.~~ The following terms apply to all “performance awards” granted under the Plan. Performance awards may be either cash-denominated performance awards or performance shares or performance share units, which are denominated in shares of Class A stock or share units. All performance awards are subject to forfeiture if performance goals are not attained. The value of any such stock awarded will be the fair market value of the stock on the date of settlement. At the time of grant, the Committee shall establish one or more performance periods of no less than twelve (12) months with respect to the performance award. If the performance award is granted during the first fiscal quarter of the Company’s fiscal year, the performance period will begin on the first day of the fiscal year, and can also be based on calendar years. For grants made after the first fiscal quarter of the Company’s fiscal year, the Committee can also use the performance period that starts on the first day of the fiscal year or calendar year, and the Committee can choose to prorate the grants. Otherwise, the performance period will begin on the date of grant or such other period selected by the Committee. At the time of grant, the Committee will also establish one or more business performance goals for the performance period, and the weight to be given each such goal. All performance goals established by the Committee must also be approved by the Board. The initial performance goals may be modified or adjusted during the performance period in light of previously unforeseen transactions, events or circumstances occurring after the initial performance goals are established.

~~Performance Awards to Directors or Employees Other than Named Executive Officers.~~The following terms apply only to performance awards granted to directors or employees who are not named executive officers and to performance awards that the Committee otherwise does not designate as subject to the requirements of Section 162(m) of the Code, as explained in more detail in the following section entitled “Performance Awards to Named Executive Officers.” As soon as practicable after the end of a performance period, the Committee will determine the extent to which the performance goals for the related performance award were attained. If the Committee determines that the performance goals were fully attained, and, subject to the terms of any applicable Award agreement, if the grantee of the performance award has remained an employee or director throughout the applicable performance period, and any other conditions imposed by the Committee

are satisfied, the performance award will become fully vested according to its terms. However, if the grantee did not remain employed by or in service to the Company throughout the performance period due to the director or employee’s death, disability, termination by the Company without “cause” (as such term is defined later in this section), or following normal retirement as defined by the Committee, then as soon as practicable following termination of employment or service (but not earlier than after the applicable performance periods are completed and the date the Committee determines that the performance goals are attained), the grantee will be entitled to receive a~~pro-rata~~ portion of the part of his or her performance award that would have otherwise vested if the grantee’s employment or service had continued until the end of the performance period, provided that in the event of a termination by the Company without “cause”, the grantee must have been an employee or director for at least one year after the date the grants were approved by the Committee. If the grantee reaches normal retirement age as defined by the Committee, the grantee will become eligible for a prorated performance award under the terms of the award, provided that the performance goals are attained. The remainder of such grantee’s performance award will be forfeited unless the Committee decides to waive such forfeiture. If the grantee ceases to be an employee or director during the applicable performance period for any reason other than death, disability, termination by the Company without cause or normal retirement, the Committee shall determine the disposition of the performance award at the end of the performance period, which disposition may include forfeiture of all or a portion of the Award. Performance awards that vest will be settled during, or soon after, the year the vesting date occurs, and no later than two and~~one-half~~ months after the end of the year in which vesting occurs. “Cause” means the occurrence of any one or more of the following: (i) the grantee’s willful and continued failure to substantially perform his duties after a written demand and opportunity to explain and defend and cure; (ii) the grantee’s gross negligence or willful engagement in conduct that is demonstrably and materially injurious to the Company, monetarily or otherwise; (iii) the grantee’s conviction of, or plea of guilty or nolo contendere, to any felony or to any other crime which involves the personal enrichment of the grantee at the expense of the Company; and (iv) the grantee’s material breach of the Company’s Code of Business Conduct and Ethics.

At the end of the performance period, the Committee may recommend a grant of additional shares of Class A stock to the grantee of a performance award that is to be settled in shares if the grantee is then an employee and the Committee determines that satisfaction of the performance goals so warrants. Additional shares awarded to a grantee shall be immediately vested and shall be issued to the grantee as soon as practicable after the grant.

An Award of performance share units or any cash-denominated performance award that vests shall be settled in cash, whole shares of Class A stock or a combination of cash and stock, as the Committee shall determine, as soon as practicable after the vesting date.

~~Performance Awards to Named Executive Officers.~~ In order to facilitate exemption of compensation paid in connection with performance awards to named executive officers of the Company (which includes the chief executive officer and the three other most highly compensated executive officers other than the chief executive officer or the chief financial officer) from the $1 million tax deduction limit imposed by Code Section 162(m), the Plan requires that such Awards be “performance-based” and that certain other requirements be met. In addition, if an Award of restricted shares, restricted share units, or other stock-based awards are intended to qualify as “performance-based,” then all requirements described under this subsection will apply to such Awards. The requirements included in this section also extend to any Award to an employee of the Company that the Committee reasonably believes may become a named executive officer if the Committee designates the Award to be subject to the Section 162(m)’s requirements.

Performance awards may be granted to Named Executive Officers only during the first 90 days of the Company’s applicable performance period, except in limited circumstances. Subject to the general limits on Award amounts, the maximum number of performance shares and/or performance share units that may be granted to any given executive officer with respect to a single performance period is 500,000.

At or prior to the grant of any performance award to a named executive officer, the Committee shall establish one or more objectively determinable performance goals for the Award relating to one or more of the following areas of Company performance over the relevant performance period: earnings (which includes net profits, operating earnings, and net income, and may be calculated before or after taxes, interest, depreciation, amortization or taxes) or earnings per share of Class A stock; revenues; gross profits; cash flow; return on revenues, gross profits, sales, assets or equity; customer or employee retention; customer satisfaction; expenses or expense levels; one or more operating ratios; stock price; market share; capital expenditures; net borrowing, debt leverage levels, credit quality or debt ratings; the accomplishment of mergers, acquisitions, dispositions, public offerings or similar extraordinary business transactions; the Company’s Quality Management System; shareholder return; organizational health/productivity; sales volume; and/or brand or product recognition/acceptance. The Committee may elect to determine such performance goals on an annual or cumulative basis, or based on some other portion of the performance period.

At the same time, the Committee shall establish a “payout” schedule for each performance goal established for the performance award, which shall be a predetermined range from threshold performance amount or level of the target performance award, performance shares and/or performance share units constituting the Award (if actual Company results for the period do not at least equal a threshold performance amount or level specified by the Committee, then payout will be zero) to maximum performance amount or level of such target Award and shall be structured so as to permit objective determination of payouts over the full range of actual Company results.

~~In connection with the establishment of the performance goal(s), at the time a performance award is granted, the Committee shall specify which (if any) types or categories of extraordinary, unusual,non-recurring,~~ or other items or events shall be excluded or otherwise not taken into account when actual Company results relating to such goal(s) are calculated. The only adjustments in actual Company results which thereafter shall be permissible for purposes of applying the payout schedule shall be objectively determinable adjustments for the items or events so specified.

The Committee may establish other preconditions to the payout of Awards, including preconditions the satisfaction of which may call for subjective determinations by the Committee to reduce an award. The payout on any performance award may also be reduced if, in the Committee’s judgment, the individual performance of the named executive officer during the performance period has not warranted the payout so calculated. Further, awards made to newly hired or promoted Named Executive Officers can be reduced at the discretion of the Committee. In no event shall the payout on any performance award exceed the payout permissible under the Award’s payout schedule nor shall any additional shares or additional cash amount be granted to any named executive officer under the Plan so long as Code Section 162(m) remains in effect and the award is intended to qualify as “qualified performance-based compensation” within the meaning of Code Section 162(m).

With respect to a named executive officer who is newly hired or is promoted by the Company during the performance period, the Committee will grant a Performance Award, or adjust a Performance Award previously granted, to the named executive officer for the performance period pursuant to the provisions of the Plan; provided, however, that no Performance Award will be granted or adjusted in a manner as to cause any award to fail as “qualified performance-based compensation” within the meaning of section 162(m)(4)(C) of the Code and~~Section 1.162-27~~ ~~of the Treasury Regulations promulgated thereunder.~~

A named executive officer who is granted a Performance Award more than 90 days after the beginning of the performance period, either because the named executive officer is newly hired or is promoted into a named executive officer position, will be granted a Performance Award under the Plan for the performance period based on the threshold, target, and maximum levels established by the Committee during the first 90 days of the performance period for similar employees at the new or promoted named executive officer’s award level, with the number of threshold, target, and maximum shares that can be earned at each level~~pro-rated~~ based on the ratio of the number of full months remaining in the performance period on and after the date of hire or promotion (as applicable) to the total number of months in the performance period. For any award level created between the award levels for which the Committee has established the threshold, target, and maximum levels, straight-line interpolation will be used to determine the~~pro-rated~~ ~~number of threshold, target, and maximum shares.~~

If a named executive officer is promoted after the beginning of a performance period, the named executive officer’s outstanding Performance Award granted for the performance period will be adjusted, effective as of the date of the promotion, based on the threshold, target, and maximum levels established by the Committee during the first 90 days of the Performance Period for similar employees at the named executive officer’s new award level. The adjustments to each named executive officer’s Performance Award will be~~pro-rated~~ on a monthly basis, with the number of threshold, target, and maximum shares for the named executive officer’s original position applicable for the number of full months preceding the effective date of the promotion and the number of threshold, target, and maximum shares for the named executive officer’s new position applicable for the remaining number of months in the performance period. For any award level created between the award levels for which the Committee has established the number of threshold, target, and maximum shares as described above, straight-line interpolation will be used to determine the~~pro-rated~~ ~~number of threshold, target, and maximum shares.~~

As soon as practicable following the completion of the performance period applicable to a performance award, the Committee will certify in writing the extent to which the applicable performance goals have been attained and the resulting final value of the performance award earned by the named executive officer.

If a performance award is granted to a named executive officer and the grantee ceases to be an employee before the end of the performance period due to the grantee’s death, disability, termination by the Company without “cause” (as defined previously) or following normal retirement as defined by the Committee, then as soon as practicable following termination

of employment (but not earlier than after the applicable performance periods are completed and the date the Committee determines that the performance goals are attained), the grantee will be entitled to receive a~~pro-rata~~ portion of the part of his or her performance award that would have otherwise vested if the grantee’s employment had continued until the end of the performance period, provided that in the event of termination by the Company without cause, the grantee had been an employee for at least one year after the date the grants were approved by the Committee. If the grantee reaches normal retirement age as defined by the Committee, the grantee will become eligible for a prorated performance award under the terms of the award, provided that the performance goals are attained. The remainder of such grantee’s performance award will be forfeited. If the grantee ceases to be an employee during the performance period for any reason other than death, disability, termination by the Company without cause or normal retirement, the grantee will immediately forfeit his or her performance award in its entirety. Performance awards that vest will be settled during, or soon after, the year that the vesting date occurs, and no later than two and~~one-half~~ ~~months after the end of the year in which vesting occurs.~~

~~Foreign Awards.~~ The Committee may modify the terms of an Award that is an option, SAR, restricted share, restricted share unit, or performance award, for grant to an employee or director who is subject to the tax or other laws of a country other than the United States, and may grant such modified Award, and structure and grant other types of Awards related to appreciation in value of Class A stock, to such an employee or director, as the Committee determines necessary or desirable in order to provide such grantee with benefits and incentives comparable to those that would be provided the grantee if the grantee were not subject to such foreign laws, but any such modification may not be made in a manner that would cause~~non-compliance~~ ~~with the Code provisions relating tonon-qualified~~ ~~deferred compensation plans.~~

~~Other Stock-Based Awards.~~ ~~The Committee may, in its sole discretion, grant Awards of Class A stock or Awards that are valued in whole or in part by reference to,~~subsidiaries operate or are otherwise based on, the fair market value of Class A stock. These other stock-based awards will be in such form, and dependent on such conditions, as the Committee shall determine, including the right to receive shares of Class A stock (or the equivalent cash value of such shares) upon the completion of a specified period of service, the occurrence of an event, the attainment of performance objectives and/or other criteria specified by the Committee. Any other stock-based award will be paid either no later than two and~~one-half~~ ~~months after the end of the year~~located.” Article TENTH addresses circumstances in which the ~~Award vests or in alump-sum~~ ~~payment at a specified time. The maximum number of other stock-based awards that may be granted~~Board’s obligation under Delaware law is to any named executive officer during any consecutive five calendar years is 750,000. At the time of the grant of other stock-based awards to employees, the Committee shall require a period of no less than twelve (12) months of continued service by an employee following the date of grant, except as otherwise providedact, in the ~~award or the Plan for death, Disability, orchange-in-control,~~ ~~or with respect to 5 percent (5%)~~exercise of ~~the maximum number of shares of Company Stock that may be issued or delivered pursuant to the Plan.~~

~~Director Awards.~~In addition to any other award that might be granted to a director, each director who is elected at the annual stockholders meeting, whose term continues thereafter, or who is elected between annual stockholders meetings shall receive a portion of his or her annual retainer (or~~pro-rated~~ ~~annual retainer for a director elected between annual stockholders meetings)~~its business judgment, in the form of Company stock in a percentage (up to a maximum of 100%) of the annual retainer as determined by the Board at the annual stockholders meeting (or at such other time as determined by the Board). Unless deferred pursuant to a deferral program adopted by the Company for directors, with respect to those directors elected at the annual meeting of stockholders, or whose term continues thereafter, the portion of the annual retainer to be paid in the form of Company stock shall be paid on the first business day next following the date of the annual meeting of stockholders and with respect to any director elected to the Board between annual meetings, the portion of the annual retainer to be paid in the form of Company stock will be paid on the first business day following his or her election to the Board. Unless otherwise determined by the Board, the number of shares of Company stock issued to a director shall be determined by multiplying (x) the annual retainer (or~~pro-rated~~ annual retainer for a director elected between annual stockholders meetings) provided to such director for the year by (y) the percentage established by the Board for the year and dividing the product of (x) and (y) by the fair market value of a share of Company stock on the date of issue. Fractional shares resulting from this formula shall be rounded, up or down, to the nearest whole share at the sole discretion of the Board. The Board shall determine whether any Award to Directors shall be subject to any restrictions.

~~Nontransferability.~~ No Award may be sold, assigned, pledged, hypothecated or otherwise transferred in any manner except that, if the Committee determines that a transfer will not violate any requirement of the SEC or IRS, the Committee may permit an inter vivos transfer by gift to or for the benefit of a family member of the grantee. Upon the death of a grantee, outstanding Awards granted to such grantee may be exercised only by the executor or administrator of the grantee’s estate or by a person who shall have acquired the right to such exercise by will or by the laws of descent and distribution.

~~Overriding Precondition; Potential Forfeiture.~~ ~~In order for any Award to become vested or exercisable, (1) the grantee of an Award must not engage in any activity that, in the opinion of the Committee, is in competition with any activity of the~~

~~Company or any affiliated entity of the Company or that is otherwise inimical to~~ the best interests of the Company and its stockholders. The Board is proposing the elimination of Article TENTH because, in mandating consideration of certain effects upon constituencies other than stockholders, Article TENTH purports to require the Board to consider interests that ~~has not been~~may conflict with or detract from the best interests of the Company and its stockholders.

The full text of the Amended and Restated Certificate of Incorporation as proposed is set forth in Annex A, with additions indicated by underlining and deletions indicated by strikeout.

If this proposal is approved, the Company will file the Amended and Restated Certificate of Incorporation with the Delaware Secretary of State promptly after the Annual Meeting of Stockholders. The Amended and Restated Certificate of Incorporation will take effect upon filing.

This proposal must be approved by the Board of Directors or the Committee and (2) the grantee must furnish the Committee with all information confirming satisfaction of the foregoing condition that the Committee reasonably requests. If the Committee determines that a grantee has engaged in any of the foregoing prohibited activity, all of the grantee’s then outstanding Awards shall immediately be cancelled and forfeited. The above provision provides that for a period of twelve months following the termination of a grantee’s employment, the grantee agrees to abide by the~~non-competition~~ ~~andnon-solicitation~~ ~~terms as specified in the Plan; and that the grantee agrees to abide indefinitely by the confidentiality andnon-disparagement~~ terms as specified in the Plan. In the event of a violation of this provision, the Company retains all rights to seek monetary damages against a grantee or to seek other equitable remedies against the grantee.

~~Adjustments Upon Changes in Capitalization.~~ ~~In the event of a reorganization or recapitalization, merger, consolidation or similar transaction involving the Company, astock-on-stock~~ ~~dividend or split,spin-off,~~ reverse split or combination of Class A stock, a rights offering, or any other change in the corporate or capital structure of the Company, the Board shall make such adjustments as it may deem appropriate in the number and kind of shares available for issuance in the aggregate and to any individual under and pursuant to the Plan (including in settlement of incentive stock options), the number and kind of shares covered by outstanding options and the per share exercise price of such options, the numbers of outstanding SARs and share units and the terms of foreign Awards. Any adjustment with respect to an incentive stock option in connection with a transaction to which Code Section 424(a) (or its successor) applies shall be made in accordance with such Code Section unless the Board specifically determines otherwise.

~~Change-in-Control~~ ~~Definition.~~~~“Change in Control” means, unless otherwise provided in the applicable award agreement, the occurrence of any of the following events,~~

~~(i) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership (within the meaning of Rule13d-3~~ promulgated under the Exchange Act) of twenty percent (20%) or more of either (A) the Class B Common Stock of the Company or (B) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that for purposes of this paragraph (i), unless the Board adopts a resolution stating that such events constitute a Change in Control, the following acquisitions shall not constitute a Change in Control: (I) any acquisition directly from the Company, (II) any acquisition by the Company, (III) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company, (IV) transfers of shares of Company stock shown as beneficially owned by Terence E. Adderley, and any subsequent transfers of such shares, (V) an acquisition by an underwriter who temporarily holds securities pursuant to an offering of such securities, or (VI) any acquisition pursuant to a transaction which complies with clauses (A), (B), and (C) of paragraph (iii) below; or

(ii) Individuals who, at the beginning of any period of twenty-four (24) consecutive months, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date of this Plan whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or

(iii) Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company or the acquisition of assets of another entity (a “Corporate Transaction”), in each case, unless, following such Corporate Transaction, (A) all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Class B Common Stock of the Company or the Outstanding Company Voting Securities immediately prior to such Corporate Transaction beneficially own, directly or indirectly, more than fifty percent (50%) of, respectively, the Class B Common Stock of the Company or the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Corporate Transaction (including, without limitation, a corporation which as a result of such transaction owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Corporate Transaction of the Class B Common Stock of the Company or the Outstanding Company Voting Securities, as the case may be; (B) no Person (excluding any employee benefit plan (or related trust) of the Company or such corporation resulting from such Corporate Transaction) beneficially

owns, directly or indirectly, more than twenty percent (20%) of the combined voting power of the then outstanding voting securities of the corporation resulting from such Corporate Transaction, except with respect to any Person who had such ownership in the Company prior to the Corporate Transaction; and (C) at least a majority of the members of the board of directors of the corporation resulting from such Corporate Transaction were members of the Incumbent Board at the time of the execution of the documentation or action of the Board resulting in a Corporate Transaction; or

~~(iv) Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.~~

~~Application ofChange-in-Control~~ ~~The Committee may, in its sole discretion and without the consent of a grantee of an award, either by the terms of the award or by resolution adopted prior to the occurrence of achange-in-control,~~ ~~determine whether and to what extent outstanding awards under the Plan shall be assumed, converted or replaced by the resulting entity in connection with thechange-in-control~~ ~~(or, if the Company is the resulting entity, whether such Awards shall be continued by the Company), in each case subject to equitable adjustments in accordance with Section 14 of the Plan.~~

~~To the extent outstanding awards granted under the Plan are assumed, converted or replaced by the resulting entity in the event of achange-in-control~~ (or, if the Company is the resulting entity, to the extent such awards are continued by the Company) as provided in Section 15(a) of the Plan, then, except as otherwise provided in the applicable award or in another written agreement with the grantee, or in a Company severance plan, if any: (i) Any such outstanding awards that are subject to performance goals shall be converted to service-based awards by the resulting entity based on the shares of Company stock payable as if the target level performance goal had been achieved, such converted awards will continue to vest and become exercisable or be paid (as applicable) based on continued service during the remaining vesting period; (ii) All other such outstanding awards shall continue to vest and become exercisable or be paid (as applicable) based on continued service during the remaining vesting period, if any; and (iii) Notwithstanding the foregoing, if the employee’s employment is involuntarily terminated without cause, as determined by the Committee, within two years after such~~change-in-control,~~ all such outstanding awards shall become vested and exercisable or be paid (as applicable) in full, effective as of the date of such termination, and any such awards that are options or SARs shall be cancelled as of the date of termination of employment.

~~To the extent outstanding awards granted under the Plan are not assumed, converted or replaced by the resulting entity in connection with achange-in-control~~ (or, if the Company is the resulting entity, to the extent such awards are not continued by the Company) in accordance with Section 15(a) of the Plan, then, except as otherwise provided in the applicable award or in another written agreement with the grantee, or in a Company severance plan, if any, then, effective immediately prior to the~~change-in-control:~~ (i) All service-based and performance-based vesting restrictions with respect to all such outstanding awards shall lapse, with any applicable performance goals deemed to be satisfied as if “target” performance had been achieved, and all such awards shall become fully vested and exercisable or be paid, as applicable, effective as of the date of such~~change-in-control;~~ ~~and (ii) All such outstanding awards that are options or SARs shall be cancelled in accordance with Section 15(d) effective on thechange-in-control.~~

~~The Committee may, in its sole discretion and without the consent of the grantee of an award, either by the terms of the award or by resolution adopted prior to the occurrence of thechange-in-control,~~ ~~provide that any outstanding award (or a portion thereof) shall, upon the occurrence of suchchange-in-control,~~ ~~be cancelled in exchange for a payment in cash or other property (including shares of the resulting entity in connection with achange-in-control)~~ in an amount equal to the excess, if any, of the fair market value of the shares subject to the award, over any exercise price related to the award, which amount may be zero if the fair market value of a share on the date of the~~change-in-control~~ ~~does not exceed the exercise price per share of the applicable awards.~~

~~Any action or determination to be taken by the Committee in connection with achange-in-control~~ ~~shall be taken prior to suchchange-in-control.~~ For purposes of Section 15(b) of the Plan, the cancellation of an award and subjecting a cash equivalent amount to the remaining vesting schedule based on continued service will be treated as a conversion of an award that is assumed.

Notwithstanding any provision of this Plan to the contrary, and except as otherwise provided in the award, if (i) an award is considered a “deferral of compensation” (within the meaning of Section 409A of the Code), (ii) the award becomes vested or restrictions lapse, expire or terminate upon the occurrence of a~~change-in-control,~~ ~~and (iii) either suchchange-in-control~~ is not treated as a “change in ownership” of the Company, a “change in the effective control” of the Company or a “change in the effective ownership of a substantial portion of the assets” of the Company (within the meaning of Section 409A of the Code) or payment of the award is not otherwise permitted upon the~~change-in-control~~ ~~under Section 409A of~~

~~the Code without the imposition of taxes and penalties, then even though such award may be deemed to be vested or restrictions lapse, expire or terminate upon the occurrence of thechange-in-control,~~ payment of the vested award will be made, to the extent necessary to comply with the provisions of Section 409A of the Code, to the grantee on the earliest of: (A) the grantee’s “separation from service” with the Company (as defined for Section 409A of the Code), provided that if the grantee is a “specified employee” (determined pursuant to the Company’s policy for determining specified employees in accordance with Section 409A of the Code), the payment date shall be the first day of the seventh (7th) month after the date of the grantee’s separation from service; (B) the date payment otherwise would have been made in the absence of any provisions in this Plan to the contrary (provided such date is permissible under Section 409A of the Code); or (C) the grantee’s death.

Section 15 of the Plan shall not apply to any other stock-based awards or director awards granted pursuant to Section 11 of the Plan that are not subject to any vesting restriction and payment is deferred pursuant to the Company’s Management Retirement Plan or the~~Non-Employee~~ ~~Directors Deferred Compensation Plan.~~

~~Duration; Amendment or Termination of Plan.~~ The Plan is effective upon approval of the Board of Directors (subject to approval of the Company’s stockholders) and will continue in effect for a term of 10 years unless terminated by the Board. Following approval of the Company’s stockholders, the expiration date of the Plan is February 15, 2027. The Board of Directors may amend, suspend or terminate the Plan at any time; provided, that no amendment shall adversely affect the rights of any grantee or holder of an Award then outstanding and unvested without the consent of the grantee or holder, unless the amendment or termination is necessary to comply with applicable law. Notwithstanding the foregoing, the Plan will not be amended without the approval of the Company’s stockholders to increase the maximum aggregate number of shares of Class A stock that may be issued under the Plan, to change the class of persons eligible to receive incentive stock options, or to make any other amendment that would require approval of the Company’s stockholders under applicable law.

The following discussion is designed to provide a general summary of the material federal income tax consequences, as of the date of this proxy statement, with respect to Awards granted under the Equity Incentive Plan. In addition to the tax consequences described below, (i) officers and directors of the Company subject to Section 16 of the Exchange Act may be subject to special rules regarding the income tax consequences of their Awards and (ii) any entitlement to a tax deduction on the part of the Company is subject to the applicable federal tax rules, including those relating to the $1 million limitation on deductible compensation under Code Section 162(m).

~~Incentive Stock Options.~~ If a stock option under the Plan is treated as an incentive stock option, the optionee generally recognizes no taxable income as a result of the grant or exercise of the option. However, an amount equal to the difference between the fair market value of the stock on the date of exercise and the exercise price is classified as an item of alternative minimum taxable income in the year of exercise for purposes of the alternative minimum tax.

The Company will not be allowed a deduction for federal income tax purposes in connection with the grant or exercise of an incentive stock option, regardless of the applicability of the alternative minimum tax to the optionee. The Company will be entitled to a deduction, however, to the extent that ordinary income is recognized by the optionee upon a disqualifying disposition (as described below).

Upon a sale or exchange of the shares at least two years after the grant of an incentive stock option and one year after exercise of the option, gain or loss will be recognized by the optionee equal to the difference between the sale price and the exercise price. Such gain or loss will be characterized for federal income tax purposes as a long-term capital gain or loss. The Company is not entitled to any deduction under these circumstances.

If an optionee disposes of shares acquired from the exercise of an incentive stock option prior to completion of either of the above holding periods, the optionee will have made a “disqualifying disposition” of the shares. In such event, the optionee will recognize ordinary income at the time of disposition equal to the difference between the exercise price and the lower of the fair market value of the stock at the date of the option exercise or the sale price of the stock. The Company generally will be entitled to a deduction in the same amount as the ordinary income recognized by the optionee on a disqualifying disposition.

The optionee also will recognize capital gain or loss (long or short-term, depending on the length of time the stock was held) on such disqualifying disposition in an amount equal to the difference between (i) the amount realized by the optionee upon such disqualifying disposition of the stock and (ii) the exercise price, increased by the total amount of ordinary income, if any, recognized by the optionee upon such disqualifying disposition (as described in the second sentence of the preceding paragraph).

~~Non-Qualified~~ ~~Stock Options.~~ ~~An optionee generally recognizes no taxable income as the result of the grant of anon-qualified~~ ~~stock option. Upon exercise of anon-qualified~~ stock option, an optionee generally will recognize ordinary income for federal income tax purposes equal to the excess, if any, of the then fair market value of the shares over the exercise price, subject to withholding of income and applicable employment taxes. The Company will generally be entitled to a tax deduction to the extent and in the year that ordinary income is recognized by the exercising optionee.

~~Upon a sale of shares acquired pursuant to the exercise of anon-qualified~~ stock option, any difference between the sale price and the fair market value of the shares on the date of exercise will be treated as capital gain or loss (long- or short-term, depending on the length of time the stock was held). Long-term capital gain is subject to a lower federal income tax rate than is applied against short-term capital gain.

~~Restricted Shares; Additional Shares.~~ The federal income tax treatment of individuals who receive property in connection with the performance of services is governed by Code Section 83. That section requires that the recipient of the property recognizes income from the transfer in an amount equal to the excess of the fair market value of the property received over the amount (if any) paid for the property. Income is recognized by the recipient in the first year in which the rights of the recipient to the property become “vested,” i.e., are transferable or are no longer subject to a substantial risk of forfeiture, whichever occurs first. The income is taxable at ordinary income rates and is subject to withholding of income and applicable employment taxes at the time of vesting.

Under the Equity Incentive Plan, employees will not pay any consideration for stock transferred to them as restricted shares or additional shares. If additional shares are granted to a recipient without restrictions, the recipient will recognize ordinary income (calculated as described in the preceding paragraph) in the recipient’s taxable year in which the additional shares are granted. If restricted shares are granted subject to a substantial risk of forfeiture, then unless an election is made under Code Section 83(b), as described in the next paragraph, recipients of restricted shares will recognize taxable income as of each date on which they become vested in restricted shares in the amount of the fair market value of the shares then vesting.

If stock is granted subject to restrictions, employees may elect under Code Section 83(b) to report as taxable income in the year of Award an amount of ordinary income equal to the stock’s fair market value at the time of the Award. If such an election is made, the employee is not required thereafter to report any further compensation income upon becoming vested in the stock covered by the election. Such an election must be made within 30 days of receipt of the stock. Such election may not be revoked except with the consent of the Internal Revenue Service. Employees making this election will be subject to withholding with respect to the taxable income they recognize at the time the stock is awarded to them and for applicable employment taxes.

~~The Company will generally be entitled to a tax deduction to the extent and in the year that ordinary income is recognized by the employee.~~

Employees will recognize gain upon the disposition of stock equal to the excess of (a) the amount realized on such disposition over (b) the ordinary income recognized with respect to the stock under the principles set forth above. That gain will be taxed as long or short-term capital gain, depending on the length of time the stock was held.

If an employee disposes of his or her stock for an amount less than the amount of ordinary income recognized with respect to the stock, he or she will generally recognize a capital loss (long or short-term, depending on the length of time the stock was held) equal to the difference between any ordinary income recognized with respect to the stock under the principles described previously and the amount realized upon disposition of the stock. An employee’s capital loss is subject to certain limitations on tax deductibility. If an employee forfeits unvested stock upon termination of employment for which a Code Section 83(b) election has been made, he or she will generally recognize a capital gain or loss equal to the difference between the amount, if any, paid by the employee for the stock and the amount received as a result of the forfeiture, but no loss or deduction is allowed with respect to the amount previously included in income as a result of the Code Section 83(b) election. As stated above, employees will not pay consideration for stock transferred to them as restricted shares and, accordingly, no deduction will be available if the restricted shares are forfeited.

~~SARs.~~ Recipients of SARs generally should not recognize income until such rights are exercised. Upon exercise, the employee will normally recognize ordinary compensation income for federal income tax purposes equal to the amount of cash and the fair market value of stock, if any, received upon such exercise. Employees will be subject to withholding of income and applicable employment taxes with respect to income recognized upon exercise of a SAR.

~~The Company will generally be entitled to a tax deduction to the extent and in the year that ordinary income is recognized by the employee.~~

~~Performance Awards and Restricted Share Unit Awards.~~ An employee generally will recognize no income upon the grant of a performance award or restricted share unit award. Upon the settlement of such Awards, employees normally will recognize ordinary income in the year of receipt in an amount equal to the cash received and the fair market value of any~~non-restricted~~ shares received. Such ordinary income generally is subject to withholding of income and employment taxes. Upon the sale of any shares received, any gain or loss, based on the difference between the sale price and the fair market value on the settlement date, will be taxed as capital gain or loss, long or short-term, depending on the length of time the stock was held.

~~The Company generally will be entitled to a deduction equal to the amount of ordinary income recognized by the employee on the settlement date.~~

Awards under the Equity Incentive Plan are based on the Company’s performance. Accordingly, future Awards under the Plan are not determinable at this time. Reference is made to the tables captioned “Summary Compensation Table 2016”, “Grants of Plan-Based Awards 2016”, “Outstanding Equity Awards at Fiscal Year End 2016”, “Option Exercises and Stock Vested Fiscal Year 2016” at pages 50 through 54 of this proxy statement for detailed information on Awards and exercises of Awards by certain executive officers under the Equity Incentive Plan during the three most recent fiscal years.

~~As of December 30, 2016, the market value of the Class A stock was $22.92 per share, based on the closing price of the Class A stock as reported by the Nasdaq Global Market.~~

The following table shows the number of shares of our common stock that may be issued upon the exercise of outstanding options, warrants and rights, the weighted-average exercise price of outstanding options, warrants and rights, and the number of securities remaining available for future issuance under our equity compensation plans as of the 2016 fiscal year end.

⁽¹⁾ ~~The equity compensation plans approved by our stockholders include our Equity Incentive Plan,Non-Employee~~ ~~Director Stock Option Plan, andNon-Employee~~ ~~Director Stock Award Plan.~~

The number of shares to be issued upon exercise of outstanding options, warrants and rights excludes 653,243 shares of restricted stock, 287,896 shares of financial measure performance awards earned but not yet vested, as well as 497,250 shares of financial measure performance awards and 415,750 shares of total shareholder return performance awards at maximum level (200%) granted to employees and not yet earned or vested at January 1, 2017.

⁽²⁾ The Equity Incentive Plan provided that the maximum number of shares available for grants, including stock options and restricted stock, is 15 percent of the outstanding Class A common stock, adjusted for plan activity over the preceding five years.

~~TheNon-Employee~~ ~~Director Stock Option Plan provides that the maximum number of shares available for settlement of options is 250,000 shares of Class A common stock.~~

~~TheNon-Employee~~ ~~Director Stock Plan provides that the maximum number of shares available for Awards isone-quarter~~ ~~of one percent of the outstanding Class A common stock.~~

⁽³⁾ ~~We have no equity compensation plans that have not been approved by our stockholders.~~

~~This proposal will be approved if it receives the~~ affirmative vote of ~~the~~ holders of a majority of the voting power of the Company’s outstanding Class B ~~common stock present in person or by proxy and entitled to vote at the Annual Meeting.~~Common Stock. For purposes of this stockholder vote, ~~any shares that are the subject of aso-called~~ ~~“brokernon-vote”~~ ~~will not be considered present, but any shares for which an abstention is registered will be considered present. Therefore, any~~abstentions and broker~~non-vote~~ ~~on the proposal will have no effect on the outcome of the vote, while any abstention registered with respect to the proposal~~ non-votes will have the ~~same~~ effect ~~as a vote “Against”~~of votes against the proposal.

PROPOSAL 4 - AMENDMENT TO THE COMPANY’S AMENDED AND RESTATED BYLAWS TO DESIGNATE THE DELAWARE CHANCERY COURT AS THE EXCLUSIVE FORUM FOR CERTAIN LEGAL ACTIONS

As described in the “Corporate Governance” section of this Proxy Statement, the Board recently formed a special committee consisting of the independent Directors to review and make recommendations to the Board about governance matters. Upon recommendation of the special committee, the Board approved and adopted Amended and Restated Bylaws effective March 7, 2018 (as disclosed in the Company’s Current Report on Form 8-K filed with the SEC on March 9, 2018). Also upon recommendation of the special committee, the Board approved and adopted, and recommends for stockholder approval, an amendment to the Company’s Amended and Restated Bylaws (the “Bylaw Amendment”) that, if adopted, would result in the Delaware Court of Chancery serving as the exclusive forum for certain legal actions involving the Company. Specifically, if this proposal is approved by our stockholders, the Company’s Amended and Restated Bylaws will be amended to insert a new Article XI as follows:

Unless the corporation consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall, to the fullest extent permitted by law, be the sole and exclusive forum for (1) any derivative action or proceeding brought on behalf of the corporation, (2) any action asserting a claim of breach of a fiduciary duty owed by any current or former director, officer, other employee or stockholder of the corporation to the corporation or the corporation’s stockholders, (3) any action asserting a claim arising pursuant to any provision of the General Corporation Law of the State of Delaware, the Company’s certificate of incorporation or the Bylaws or as to which the General Corporation Law of the State of Delaware confers jurisdiction on the Court of Chancery of the State of Delaware, or (4) any action asserting a claim governed by the internal affairs doctrine. Any person or entity purchasing or otherwise acquiring or holding any interest in shares of capital stock of the corporation shall be deemed to have notice of and consented to the provisions of this Article XI.

The Board believes that the Bylaw Amendment is in the best interests of the Company and its stockholders for the following reasons:

The Bylaw Amendment is not being proposed by our Board in anticipation of or in reaction to any specific litigation or transaction; rather, it is being proposed to prevent potential harm to the Company and its stockholders. Although some plaintiffs might prefer to litigate the intra-corporate disputes described above in a forum outside of Delaware because they perceive another court as more convenient or more favorable to their claims, the Board believes that the substantial benefits to the Company and to our stockholders as a whole from designating the Delaware Chancery Court as the exclusive forum for these specific matters outweighs such concerns. Furthermore, the Board retains the discretion to permit litigation to proceed in an alternative forum. In keeping with the views of certain proxy advisors, the Board is seeking the approval of stockholders prior to adopting the Bylaw Amendment. If the proposal is not approved, the Board will reconsider whether the Bylaw Amendment is in the best interests of the Company.

If this proposal is approved, the Bylaw Amendment will become effective immediately.

This proposal must be approved by the affirmative vote of holders of a majority of the voting power the Company’s outstanding Class B Common Stock. For purposes of this stockholder vote, abstentions and broker non-votes will have the effect of votes against the proposal.

PROPOSAL 5 - RATIFICATION OF THE APPOINTMENT OF PRICEWATERHOUSECOOPERS LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR THE ~~2017~~2018 FISCAL YEAR

On an annual basis, the Audit Committee ~~(the “Committee”)~~ approves and appoints the independent registered public accounting firm. During its February ~~15, 2017~~14, 2018 meeting, PricewaterhouseCoopers LLP (“PwC”) was appointed to audit the consolidated financial statements of the Company for the year ending December ~~31, 2017.~~30, 2018. This firm has served as the Company’s independent registered public accounting firm for many years and is considered to be well qualified. The reappointment process for the independent registered public accounting firm includes an annual assessment that takes into consideration, but is not limited to, a review of the following:

The Board of Directors seeks ratification of the appointment of PwC. The representatives of the firm are expected to be present at the Annual Meeting and will be available to respond to all appropriate questions.

The Audit Committee is responsible for the compensation (including negotiations) of the independent registered public accounting firm and requirespre-approval of all audit andnon-audit services prior to engagement by the Company. In conjunction with thepre-approval, the Committee considers whethernon-audit services are consistent with the rules and regulations of the SEC on auditor independence. The authority of the Audit Committee is detailed in its charter, which is posted on the Company’s website at~~kellyservices.com.~~kellyservices.com.

The table below displays the fees incurred from the audit andnon-audit services provided by PwC.

Audit Fees: Audits and quarterly reviews of our consolidated financial statements, statutory audits, attestation of controls, issuance of consent, and assistance with review of documents filed with the SEC.

Audit Related Fees:Technical assistance with new accounting standards and services associated with international regulatory reporting.

In connection with the financial statements for the fiscal year ended ~~January 1,~~December 31, 2017, the Audit Committee has:

(2) discussed with PwC, the matters required to be discussed by the statement on Public Company Accounting Oversight Board AU Section 380 Communication With Audit Committees; and

(3) received the written disclosures and the letter from PwC required by applicable requirements of the Public Company Accounting Oversight Board regarding PwC’s communications with the Audit Committee concerning independence, and has discussed with PwC its independence.

Based upon these reviews and discussions, the Audit Committee recommended to the Board at its February ~~15, 2017~~14, 2018 meeting that the Company’s audited financial statements be included in the Annual Report on Form10-K for the year ended ~~January 1,~~December 31, 2017 filed with the SEC. The Board approved this inclusion.


		THE AUDIT COMMITTEE

~~EXHIBIT A~~

~~DRAFT 3/~~1610/1517

~~KELLY SERVICES, INC.~~

~~EQUITY INCENTIVE PLAN~~

~~(As Amended and Restated February~~ ~~12, 201515, 2017~~)

~~Section 1 — Purposes~~

~~This KELLY SERVICES, INC. EQUITY INCENTIVE PLAN (the “Plan”) provides for long-term incentive stock-related or other performance-related compensation to selected key employeesand directorsof the Company or an Affiliated Entity for their contributions to the Company’s growth and profitability. Such compensation is intended to help the Company attract and retain superior~~~~employeesindividuals, and it gives those~~~~employeesindividuals~~ ~~shared financial interests with the Company’s stockholders that are believed to positively affect their job performance.~~

~~Section 2 — Definitions and Rules of Construction~~

~~(a) The terms in quotation marks below have the following meanings under the Plan:~~

“~~Additional Shares” means immediately vested shares of Company Stock awarded pursuant to Section 9A(c) of the Plan.~~

“~~Affiliated Entity” means a corporation, partnership or other business enterprise in which the Company~~~~directly or indirectly has a significant equity interest under United States generally accepted accounting principles.has control as defined in Rule 405 of the Securities Act of 1933.~~

“Annual Retainer” means the total amount payable in cash or Company Stock to a Director as an annual retainer (excluding meeting fees and committee fees) for services provided by the Director to the Company.

“~~Award” means a Restricted Award, Performance Award, Other Stock-Based Award, award of Additional Shares, Option, SAR,grant of Company Stock to Directors,or Foreign Award granted under the Plan.~~

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

“~~Cause” means the occurrence of any one or more of the following:~~

~~(i) The grantee’s willful and continued failure to substantially perform hisor her~~duties with the Company (other than any such failure resulting from the grantee’s Disability), after a written demand for substantial performance is delivered to the grantee, by the Board or the Chief Executive Officer of the Company, that specifically identifies the manner in which the Board or the Chief Executive Officer believes that the grantee has not substantially performed his~~or her~~duties, and the grantee has been given an opportunity, within thirty (30) days following grantee’s receipt of such notice, to meet in person with the Board (or its designee) to explain or defend the alleged act or acts, or failure or failures to act relied upon by the Company and, to the extent such cure is possible, the grantee has not cured such act or acts or failure or failures to act within the thirty (30) day period;

;

~~(ii) The grantee’s gross negligence or willful engagement in conduct that is demonstrably and materially injurious to the Company, monetarily or otherwise;~~

~~(iii) The grantee’s conviction of, or plea of guilty or nolo contendere, to any felony or to any other crime which involves the personal enrichment of the grantee at the expense of the Company; and~~

~~(iv) The grantee’s material breach of the Company’s Code of Business Conduct and Ethics.~~

Notwithstanding the above, for purposes of this provision, no act or failure to act shall be considered “willful” or “intentional” unless done or omitted to be done, by the grantee in bad faith or without reasonable belief that the grantee’s act or omission was in the best interests of the Company. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or based upon the instructions of the Chief Executive Officer or a senior officer of the Company or based upon the advice of counsel for the Company shall be conclusively presumed to be done, or omitted to be done, by the grantee in good faith and in the best interests of the Company.

~~“Change in Control” means unless otherwise provided in the applicable Award Agreement, the occurrence of any of the following events:~~

(i) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of twenty percent (20%) or more of either (A) the Class B Common Stock of the Company or (B) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”); provided, however, that for purposes of this paragraph (i), unless the Board adopts a resolution stating that such events constitute a Change in Control, the following acquisitions shall not constitute a Change in Control: (I) any acquisition directly from the Company, (II) any acquisition by the Company, (III) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation controlled by the Company, (IV) transfers of shares of Company stock shown as beneficially owned by Terence E. Adderley, and any subsequent transfers of such shares, (V) an acquisition by an underwriter who temporarily holds securities pursuant to an offering of such securities, or (VI) any acquisition pursuant to a transaction which complies with clauses (A), (B), and (C) of paragraph (iii) below; or

		LESLIE A. MURPHY, CHAIR

~~(iv) Approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.~~

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

“~~Committee~~” means the Compensation Committee of the Board or any other committee designated by the Board to administer this Plan. The Committee shall be comprised of two or more “non-employee directors” within the meaning of Rule 16b-3 of the Securities and Exchange Commission. Further, to the extent that the Company determines it desirable to qualify Awards granted hereunder as “qualified performance-based compensation” within the meaning of Section 162(m), the Committee shall be comprised solely of two or more “outside directors” within the meaning of Section 162(m).

“~~Company” means Kelly Services, Inc.~~

“~~Company Stock” means the Class A Common Stock, $1.00 par value, of the Company.~~

		ROBERT S. CUBBIN

~~“Director” means any individual who is a member of the Board and is not an Employee.~~

“~~Disability~~” means the total and permanent inability of an Employee by reason of sickness or injury to perform the material duties of such Employee’s regular occupation with his or her Employer where such inability has existed for at least six continuous months.

“~~Employee” means an employee of the Company or an Affiliated Entity.~~

“~~Employer” means the Company or the Affiliated Entity which employs an Employee.~~

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

“~~Fair Market Value” means, for any given date, the~~~~closing marketlast sale~~ ~~price for a share of Company Stock as~~~~a Nasdaq Stock Market LLC security reported by the National Association of Securities Dealers, Inc. Automated Quotation Systemreported by The NASDAQ Stock Market~~ (“Nasdaq”) for that date (or if no such prices are so reported for such date, for the latest preceding date on which such sale prices were so reported). If the Fair Market Value for a given date cannot be determined by reference toa~~Nasdaq~~ ~~price report, it shall be determined by the reasonable application of a reasonable valuation method that satisfies the requirements of Treasury Regulation Section 1.409A-1(b)(iv)(B).~~

“~~Foreign Award” means an award granted pursuant to Section 10 of the Plan.~~

“~~Incentive Stock Option” or “ISO” means an Option that meets the requirements of Section 422 of the Code (or any successor provision) and that is identified as intended to be an ISO in the written agreement evidencing the Option.~~

“~~Named Executive Officer~~” means, for purposes of Section 9B, an Employee who is the chief executive officer or among the three highest compensated officers (other than the chief executive officer or the chief financial officer) of the Company for any given fiscal year, whose compensation is subject to disclosure under Exchange Act rules, and who is a Section 16 Reporting Person, and any other~~Employee of the Companyindividual~~ ~~who is included in the definition of “covered employee” for purposes of Section 162(m) of the Code pursuant to Treasury Regulations or other Internal Revenue Service guidance.~~

“~~Nonqualified Stock Option” or “NQSO” means an Option that is not an ISO.~~

“~~Option” means an Option to purchase Company Stock granted pursuant to Section 6 of the Plan.~~

“~~Other Performance Award” means a cash-denominated award granted under Section 9A or 9B of the Plan which, until vested, is subject to forfeiture.~~

“~~Over-10% Owner” means an owner of over 10% of the total combined outstanding voting power of all classes of capital stock of the Company.~~

“~~Performance Award” means an award of Performance Shares, Performance Share Units or Other Performance Award.~~

		TERRENCE B. LARKIN, VICE CHAIR
		DONALD R. PARFET

“~~Performance Shares” and “Performance Share Units” mean, respectively, shares of Company Stock and Share Units granted under Section 9A or 9B of the Plan which, until vested, are subject to forfeiture.~~

“~~Protected Information~~” means trade secrets, confidential and proprietary business information of the Company and Affiliated Entities, and any other information of the Company, including, but not limited to, customer lists (including potential customers), sources of supply, processes, plans, materials, pricing information, internal memoranda, marketing plans, internal policies, and products and services which may be developed from time to time by the Company and its agents or employees, including the grantee; provided, however, that information that is in the public domain (other than as a result of a breach of this Plan) is not Protected Information.

~~“~~Restoration Option” means an Option granted under, and subject to the conditions set forth in, Section 6(f) of the Plan.~~~~

“~~Restricted Award” means an award of Restricted Shares or Restricted Share Units.~~

“~~Restricted Shares” and “Restricted Share Units” mean, respectively, shares of Company Stock and Share Units granted under Section 8 of the Plan which, until vested, are subject to forfeiture.~~

“~~Rule 16b-3” means Securities and Exchange Commission Rule 16b-3, as amended.~~

“~~Section 16 Reporting Person” means a person required by Section 16 of the Exchange Act and related rules to file reports concerning such person’s ownership of and transactions in Company equity securities.~~

“~~Section 162(m)” means Section 162(m) of the Code (or any successor), together with the related U.S. Department of Treasury regulations.~~

“~~Share Unit~~” means a unit available for award under the Plan which: (1) upon vesting or payout, shall entitle the holder to receive from the Company for each Share Unit vested or paid, a share of Company Stock, and (2) until settled after vesting, or until forfeited, shall entitle the holder to be paid by the Company the equivalent of any cash dividend paid on Company Stock to which the holder would have been entitled if, on the date of grant of such Share Unit, the grantee of the Share Unit had instead been granted a Restricted Share or Performance Share; provided, however, that with respect to Performance Share Units, any cash dividend equivalent shall either be not accrued and payable or be subject to the vesting restrictions applicable to the related Award, at the discretion of the Committee when the Award is granted.

“~~Solicitation” means to solicit, divert or attempt to solicit or divert from the Company and its~~~~AaffiliatedAffiliated~~ Entities, any work or business related to the employee staffing and consulting services business, which includes, but is not limited to, direct placement, outplacement, outsourcing, recruitment, recruitment process outsourcing, temporary staffing services, management services, vendor on-site, vendor management, and consulting services (the “Company’s Business”), or otherwise related to any activity that is in competition with the Company and its Affiliated Entities, from any client or customer, or potential client or customer, of the Company and its Affiliated Entities for either grantee or any other entity that may employ, engage, or associate with grantee in any fashion, or have any contact, through business-oriented social networking sites or otherwise, with any client or customer, or potential client or customer, of the Company and its Affiliated Entities for either grantee or any other entity that may employ, engage or associate with grantee in any fashion, for purposes of influencing any such client or customer, or potential client or customer, to not use or not continue to use the Company or its Affiliated Entities for work or business related to the Company’s Business (provided,

~~however, that notwithstanding anything to the contrary contained in this~~~~AgreementPlan~~, a grantee may own up to two percent (2%) of the outstanding shares of the capital stock of a company whose securities are registered under Section 12 of the Securities Exchange Act of 1934). For purposes of this section, “client(s)” or “customer(s)” of the Company and its Affiliated Entities, shall mean any individual, corporation, limited liability company, partnership, proprietorship, firm, association, or any other entity that the Company or its Affiliated Entities has invoiced during the preceding twelve (12) months, and “potential client(s) or customer(s)” shall be any individual, corporation, limited liability company, partnership, proprietorship, firm, association, or any other entity that the grantee knew or should have known was a potential customer through personal knowledge or had any personal exposure through Company meetings or marketing efforts, during the preceding twelve (12) months.

“~~Stock Appreciation Right” or “SAR~~” means a right granted pursuant to Section 7 of the Plan which, upon exercise, shall entitle the holder to receive from the Company the Fair Market Value of a share of Company Stock on the exercise date minus the Fair Market Value of such a share on the date of grant.

~~(b)~~References in this Plan to the “issuance” of shares, to shares “issued” or “issuable,” and the like, include transfers of treasury shares as well as new issuances of authorized but previously unissued shares.

~~Section 3 — Administration~~

~~(a)~~~~General.~~The Plan shall be administered by the Committee, subject to the express limitations set forth in the Plan. The Committee may, by majority vote, grant Awards and determine the type, amount and other terms and conditions of each Award. The Committee shall have authority to prescribe the forms of written agreements to evidence Awards, to interpret the Plan and the provisions of such agreements, to adopt administrative rules and procedures concerning administration of the Plan and to take such other action as it determines to be necessary, advisable, appropriate or convenient for the administration of the Plan in accordance with its purposes, including certifying whether any performance measures have been met.

The Committee may delegate to the chief executive officer of the Company, if also a director, some or all of its authority to grant Awards under the Plan to Employees who are not Section 16 Reporting Persons or Senior Vice Presidents or officers of higher rank, in which case actions taken by the chief executive officer pursuant to such delegated authority shall have the same effect as if taken by the Committee. The chief executive officer shall periodically notify the Committee of any grants made pursuant to such delegation of authority.

~~The Committee may delegate performance of recordkeeping and other ministerial functions concerning the Plan and its day-to-day operations to such persons as it may specify from time to time.~~

~~(b)~~~~Repricing.~~~~AbsentExcept for adjustments made pursuant to Sections 14 and 15, absent~~ ~~stockholder approval, neither the Committee nor the Board shall approve a program providing for~~~~either(i) the cancellation of outstanding Options and/or SARs~~~~andin exchange for cash or~~ ~~the grant in substitution therefore of new Options and/or SARs having a lower exercise price~~ or, ~~(ii) the amendment of outstanding Options and/or SARs to reduce the exercise price thereof~~~~. This paragraph shall~~, or (iii) the payment, at the time of exercise of an Option or SAR, of a cash bonus or grant or sale of another Award. This paragraph is intended to prohibit the repricing of “underwater” Options or SARs without stockholder approval and will ~~not be construed to apply to “issuing or assuming a stock option in a transaction to which section 424(a) applies,” within the meaning of Code Section 424.~~

~~(c)~~~~Interpretation and Construction~~. If an Award is intended to qualify performance-based compensation under Section 162(m), any provision of the Plan that would prevent such Award from so qualifying shall be established and administered, interpreted and construed to carry out such intention and any provision that cannot be so administered, interpreted and construed shall to that extent be disregarded.

~~Section 4 — Eligibility for Awards; No Requirement of Uniformity~~

~~Any type of Award may be granted to any Employeeor Director~~at any time, except that Foreign Awards may be granted only as permitted under Section 10 of the Plan. The type, amount, timing and other terms and conditions of Awards made to a grantee need not be uniform, comparable or proportionate among grantees.

~~Section 5 — Maximum Number of Shares; Other Award Limits~~

~~(a)~~~~Maximum Number of Shares.~~ ~~For purposes of this section, “Affected Shares~~” are shares of Company Stock that have been issued as Restricted Shares or Units, Performance Awards, Additional Shares or similar Foreign Awards or that have been made subject to future issuance in settlement of Options (whether or not with related SARs), Share Units or Foreign Awards. For a given date, the “~~Adjustment Period” comprises the Company’s current fiscal year to date, plus its four immediately preceding fiscal years.~~

~~The total number of Affected Shares~~ ~~awarded through the Company’s 2017 shareholders meeting~~ shall never exceed 15% of the number of outstanding shares of Company Stock (exclusive of treasury shares) at the end of the immediately preceding Company fiscal year (rounded downward, if necessary to eliminate fractional shares)

~~(i) minus the sum, for the Adjustment Period, of the numbers of:~~

~~(A) Shares awarded as Restricted Shares or Performance Awards~~

~~(B) Share Units awarded~~

~~(C) Shares made subject to Option grants~~~~(including Restoration Options)~~

~~(D) Shares issued or granted for future issuance as Foreign Awards.~~

~~(ii) plus the sum, for the Adjustment Period, of the numbers of:~~

~~(A) Shares as to which Options have expired or terminated for any reason other than exercise of such Options or of related Tandem SARs~~

~~(B) Shares as to which Restricted Awards and Performance Awards have been both granted and forfeited~~

~~(C) Shares transferred to the Company (actually or constructively) to satisfy the exercise price of outstanding Options.~~

~~Stock options, SARs and other equity-based awards assumed by the Company in a merger or acquisition of another company shall not count against the shares available for Award under the Plan.~~

Commencing with the Company’s 2017 shareholders meeting, the maximum number of shares of Company Stock that may be issued or delivered pursuant to Awards under the Plan shall be 4,700,000. Shares issued or delivered pursuant to an Award may be authorized but unissued Shares, treasury Shares, including Shares purchased in the open market, or a combination of the foregoing.

~~The aggregate number of Shares available for issuance or delivery under the Plan shall be subject to adjustment as provided in Section 14.~~

~~(b)~~~~ISO Award Limits.~~~~The number of shares covered by outstanding ISOs plus the number of shares issued in settlement of exercised ISOs under this Plan may not exceed 4,000,000 shares.~~

~~(c)~~~~Options, SARs, Restricted Awards, Performance Awards and Other Stock-Based Awards.~~The number of shares of Company Stock subject to an Option, SAR, Restricted Award, Performance Award or Other Stock-Based Award shall be specified at the time of grant. Subject to the limits on Award amounts set forth in Section 5(b) above, this Section 5(c) and any adjustment under Section 14 of the Plan: (i) the maximum number of shares of Company Stock that may be granted as Options (whether or not in tandem with SARs) during any consecutive five calendar years to any single Employee shall be 750,000; (ii) the maximum number of shares of Company Stock that may be granted in connection with stand-alone SARs during any consecutive five calendar years to any single Employee shall be 750,000; (iii) the maximum number of shares of Company Stock that may be granted in connection with Other Stock-Based Awards during any consecutive five calendar years to any single Employee shall be 750,000; (iv) the maximum number of shares of Company Stock subject to Restricted Awards that may be granted to any single Employee with respect to a single performance period during any consecutive five calendar years to any single Employee shall be 750,000; ~~and~~ (v) the maximum number of shares of Company Stock subject to Performance Shares and/or Performance Share Units that may be granted to any single Employee with respect to a single performance period is500,000 and (vi) the maximum Fair Market Value (determined on the grant date) of Company Stock that may be granted to any single Director with respect to each twelve-month period beginning with each annual shareholder meeting is $~~500,000.~~

~~(d)~~~~Cash Denominated Award Limits.~~~~The maximum amount of an Other Performance Award payable with respect to any single Employee shall be $~~~~1,000,0002,500,000~~ ~~multiplied by the number of years included in any applicable performance period(s) (and any applicable fraction for any portion of a performance period of less than one year) relating to such Awards.~~The maximum amount of cash compensation that may be paid (taking any deferrals into account for the year of the deferral) to any single Director with respect to each twelve-month period beginning with each annual shareholder meeting is $500,000.

~~(e)~~~~Share Usage.~~ In addition to the number of shares of Company Stock provided for in Section 5(a) with respect to Awards granted on the date of or after the Company’s 2017 shareholders meeting, the following shares shall be available for Awards under the Plan: (i) shares covered by an Award that expires or is forfeited, canceled, surrendered or otherwise terminated without the issuance of such shares and the release of the “substantial risk of forfeiture” under Section 83 of the Code, if applicable; (ii) shares covered by an Award that is settled only in cash; (iii) shares granted through the assumption of, or in substitution for, outstanding awards granted by a company to individuals who become Employees or Directors as the result of a merger, consolidation, acquisition or other corporate transaction involving such company and the Company or any of its Affiliates (except as may be required by reason of Section 422 of the Code or the rules and regulations of any stock exchange or other trading market on which the Shares are listed); and (iv) any Shares from Awards exercised for or settled in vested and nonforfeitable Shares that are later returned to the Company pursuant to any compensation recoupment policy, provision or agreement. Notwithstanding the foregoing, the following shares issued or delivered under this Plan

shall not again be available for grant as described above with respect to Awards granted on the date of or after the Company’s 2017 shareholders meeting: Shares tendered in payment of the exercise price of an Option, shares withheld by the Company or any Affiliated Entity to satisfy a tax withholding obligation, and shares that are repurchased by the Company with Option proceeds. Without limiting the foregoing, with respect to any SAR that is settled in shares, the full number of shares subject to the Award shall count against the number of shares available for Awards under the Plan regardless of the number of shares used to settle the SAR upon exercise. This Section 5(e) shall apply to the number of shares reserved and available for Incentive Stock Options only to the extent consistent with applicable Treasury regulations relating to Incentive Stock Options under the Code.

~~Section 6 — Options~~

~~(a)~~~~Incentive Stock Options and Nonqualified Stock Options.~~At the time of the grant of an Option, the Committee shall specify whether it is intended to be an Incentive Stock Option or a Nonqualified Stock Option, and the agreement evidencing such Option shall designate the Option accordingly. However, notwithstanding such designation, to the extent that the aggregate Fair Market Value of the shares with respect to which ISOs are exercisable for the first time by the grantee during any calendar year exceeds $100,000 (or such other amount as permitted by Code Section 422(d)) such Options shall be treated as Nonqualified Stock Options. For purposes of this Section 6(a), ISOs shall be taken into account in the order in which they were granted. The Committee may prescribe such terms and conditions for an ISO grant, other than those specified in the Plan, as it deems desirable to qualify the Option as an incentive stock option under the Code. If an Option (or any portion thereof) intended by the Committee to be an ISO fails to qualify as an ISO, either at the time of grant or subsequently, such failure to qualify shall not invalidate the Option (or such portion), and instead the nonqualified portion (or, if necessary, the entire Option) shall be deemed to have been granted as a Nonqualified Stock Option regardless of its designation in the grant and in the Option agreement.

~~(b)~~ ~~Exercisability.~~~~The time at which any portion of an Option first becomes exercisable (which may be at or after the date of grant) and the latest date on which the Option may be exercised (the “expiration date”) shall be as specified at the time of grant~~., provided that no Option shall be exercisable prior to twelve (12) months of continued service by a grantee following the date of grant, except as otherwise provided in the Option Award or this Plan for termination of service for death or Disability, or pursuant to Section 15. However, the expiration date for any ISO granted to an Over-10% Owner may be no later than five years after the grant, and the expiration date for any other Option may be no later than ten years after the date of grant. The Committee may, in its discretion, accelerate the exercisability of any portion of an Option or provide for automatic acceleration of exercisability of any portion of an Option upon the occurrence of such events as it may specify, such as upon the death or Disability of a grantee. However, no acceleration of exercisability of any portion of an ISO shall be effective without the consent of the Option holder if such acceleration would cause the ISO or any other ISO of such holder (or any portion thereof) to become a Nonqualified Stock Option. During the lifetime of the grantee of an Option, the Option may be exercised only by the grantee or the grantee’s legal representative.

~~(c)~~ ~~Exercise Price~~. Unless a higher price is specified at the time of grant, the per share exercise price of each Option shall be the Fair Market Value of a share of Company Stock on the date of grant, except that the per share exercise price of any ISO granted to an Over-10% Owner shall be at least 110% of such Fair Market Value on the grant date.

~~(d)~~ ~~Exercise Procedures and Payment.~~ The holder of an exercisable Option (or Option portion) may exercise it in whole or in part by complying with such procedures for exercise as are then in effect and tendering payment in full of the aggregate exercise price for the number of shares in respect of which the Option is then

being exercised. Except to the extent further restricted or limited at the time of grant, payment may be made (1) entirely in cash, (2) by delivery of whole shares of Company Stock owned by the Option holder for more than six months on the date of surrender, (3) pursuant to a cashless exercise program implemented by the Company in connection with the Plan or (4) by any combination of the foregoing methods of payment. Any shares delivered in payment shall be valued at their Fair Market Value on the date of delivery.

~~(e)~~ ~~Effect of Employmentor ServiceTermination~~~~. The Committee shall determine the disposition of the grant of each Option in the event of the disability, death or other termination of employment of an Employee~~ ~~or termination of service as a Director~~.

~~(f)~~ ~~Restoration Options.~~ ~~Subject to the provisions below, the Committee may provide that an Option shall also carry with it a right to receive another Option (a “~~~~Restoration Option~~~~”) in certain circumstances. A Restoration Option may be created at the time of grant of an Option (for purposes of this paragraph, an “~~~~original Option~~”) that is not itself a Restoration Option at the time a Restoration Option arises (so as to provide a subsequent Restoration Option to it), or at any other time while the grantee continues to be eligible for Awards and the original or Restoration Option (the “~~prior Option~~”) is outstanding. In addition to any other terms and conditions (including additional limitations on exercisability) that the Committee deems appropriate, each Restoration Option shall be subject to the following:

(i) A Restoration Option may arise only if, earlier than six months before the expiration date of the prior Option, the grantee exercises the prior Option (or a portion thereof) while still an Employee and pays all or some of the relevant exercise price in shares of Company Stock that have been owned by the grantee for at least six months prior to exercise

~~(ii) The number of shares subject to the Restoration Option shall be the number of whole shares delivered in exercise of the prior Option, except that the number will be reduced~~ ~~to the extent necessary~~~~for the Plan to comply with the limitations imposed by Section 5 of the Plan~~

~~(iii) The Restoration Option shall arise and be granted (if ever) at the time of payment of the relevant exercise price in respect of the prior Option~~

~~(iv) The per share exercise price of the Restoration Option shall be the Fair Market Value of a share of Company Stock on the date the Restoration Option arises~~

~~(v)~~ ~~The expiration date of the Restoration Option shall be the same as that of the prior Option~~

~~(vi) The Restoration Option shall first become exercisable six months after it arises~~

~~(vii)~~ ~~The Restoration Option shall be a Nonqualified Stock Option.~~

~~Section 7 — Stock Appreciation Rights~~

~~(a)~~ ~~Types of SARs Authorized.~~~~SARs may be granted in tandem with all or any portion of a related Option (a “Tandem SAR”) or may be granted independently of any Option (a “Stand-Alone SAR~~”). A Tandem SAR may be granted either concurrently with the grant of the related Option or at any time thereafter prior to the complete exercise, termination, expiration or cancellation of such related Option.

~~(b)~~ ~~Exercise Price.~~The exercise price for each SAR shall be established in the discretion of the Committee; provided, however, that (i) the exercise price per share subject to a Tandem SAR shall be the exercise price per share under the related Option (but not less than the Fair Market Value per share of Company Stock on the effective date of grant of the SAR) and (ii) the exercise price per share subject to a Stand-Alone SAR shall not be less than the Fair Market Value of a share of Company Stock on the effective date of grant of the SAR.

~~(c)~~ ~~Exercisability and Termination~~.

~~(i) Tandem SARs. Tandem SARs shall be exercisable as follows, subject to such other provisions as the Committee may specify when the Tandem SAR is granted:~~

~~(A) The only persons entitled to exercise such SARs shall be the holder of the related Option or such holder’s legal representative~~

~~(B) The expiration date of such SARs shall be the same as that of the related Option~~

(C) SARs shall be exercisable if (and only if) and to the extent that the related Option is then exercisable, except that SARs shall not be exercisable by a Section 16 Reporting Person at any time within six months after the date on which the SARs were granted even if the related Option is then exercisable

~~(D) Exercise of SARs shall automatically terminate the related Option with respect to the same number of shares as the number of SARs being exercised~~

(E) Exercise, cancellation or termination of an Option shall automatically terminate the same number of related SARs as the number of shares with respect to which the Option is being exercised, canceled or terminated

~~(F) Tandem SARs related to an Incentive Stock Option shall be exercisable only when the then Fair Market Value of a share of Company Stock exceeds the exercise price of the Incentive Stock Option.~~

(ii) Stand-Alone SARs. Stand-Alone SARs shall be exercisable at such time or times, or upon such event or events, and subject to such terms, conditions, performance criteria and restrictions as shall be determined by the Committee and set forth in the Award agreement evidencing such SAR; provided, however, that no Stand-Alone SAR shall be exercisable after the expiration of ten (10) years after the effective date of grant of such SAR., and further provided that no SAR shall be exercisable prior to twelve (12) months of continued service by a grantee following the date of grant, except as otherwise provided in the SAR Award or this Plan for termination of service for death or Disability, or pursuant to Section 15.

~~(d)~~ ~~Exercise Procedures and Settlement Elections.~~ Exercisable SARs may be exercised at any time in accordance with such exercise procedures as are then in effect. Except to the extent further restricted at the time of grant, at or prior to exercise of SARs, the holder may elect to have the exercised SARs settled (1) entirely in cash, (2) to the extent possible, in whole shares of Company Stock and the balance in cash, or (3) partially in cash in an amount specified by the holder and the balance in whole shares of Company Stock plus cash in lieu of any fractional share. If no election is made, the SARs shall be settled in any of the foregoing manners as the Committee shall determine. For purposes of settlement, shares of Company Stock shall be valued at their Fair Market Value as of the settlement date.

~~(e)~~ ~~Effect of Termination of Employment.~~ A SAR shall be exercisable after a grantee’s termination of employment to the extent and during such period as determined by the Committee, in its discretion, and as set forth in the Award agreement evidencing such SAR.

~~Section 8 — Restricted Awards~~

~~(a)~~ ~~General.~~Awards of Restricted Shares are awards of actual Company Stock, while Awards of Restricted Share Units are awards that may consist of Company Stock, cash equivalents of Company Stock, or a combination of both. The restrictions that may be imposed relate to possession, vesting and conditions to vesting, payment of dividends and potential forfeiture.

~~(b)~~ ~~Restriction Period.~~~~At the time of grant of a Restricted Award, the Committee shall establish a period of no less than twelve months with respect to such Restricted Award, which period (the “restriction period~~”) shall commence on the date of grant or such other date selected by the Committee. The Committee may provide for such restriction period to lapse in installments. The Committee may impose such restrictions or conditions to the vesting of a Restricted Award as it, in its sole discretion, deems appropriate. By way of example and not by way of limitation, the Committee may require, as a condition to the vesting of any Restricted Award, that the grantee or the Company achieves such performance goals as the Committee may specify. If a Restricted Award is intended to qualify as “qualified performance-based compensation” under Code Section 162(m), all requirements set forth in Section 9B that otherwise apply to Performance Awards must also be satisfied with respect to such Restricted Award in order for a grantee to be entitled to payment.

~~(c)~~ ~~Vesting and Forfeiture.~~ ~~If the grantee of a Restricted Award remains an Employeeor Director~~ throughout the applicable restriction period, and any other conditions imposed by the Committee are satisfied, the entire Restricted Award shall become fully vested and no longer subject to forfeiture at the end of the restriction period. If the grantee ceases to be an Employee~~or Director~~during the restriction period due to death or Disability (including during the first twelve months following the date of grant), the Award shall be vested in proportion to the then elapsed portion of the restriction period, and the remainder of such Award shall be forfeited, unless the Committee determines to waive such forfeiture, in whole or in part, and vest those Shares or Units. If the grantee otherwise ceases to be an Employee~~or Directorduring the restriction period, the Committee shall determine the disposition of the Award.~~

~~(d)~~ ~~Restricted Share Certificates and Dividends or Distributions.~~ Restricted Shares shall be issued to the grantee as promptly as practicable after the grant, but the certificates representing such Restricted Shares shall bear an appropriate legend and shall be held by the Company. Non-cash dividends or other distributions upon Restricted Shares shall be retained and held by the Company, pending vesting or forfeiture of the Restricted Shares. Such retained non-cash dividends and other distributions shall be vested or forfeited, as the case may be, upon the vesting or forfeiture of such Restricted Shares. Non-cash dividends and other distributions that vest shall be distributed to the grantee of the Restricted Shares as promptly as practicable after the vesting date. The grantee of Restricted Shares shall be entitled to receive any cash dividends paid with respect to such Shares during the restriction period.

~~(e)~~ ~~Settlement of Restricted Share Units.~~ ~~An Award of Restricted Share Units that vests shall be settled in cash, whole shares of Company Stock (valued at Fair Market Value as of the settlement date), or a combination~~

thereof, as the Committee shall determine. The mode of settlement shall not violate the Plan’s limitations on available shares or any limitations imposed by the Committee at the time of grant of the Award or at any other time while the Award is unvested and the grantee is still an Employee ~~or Director. Restricted Share Units that vest shall be settled in full during the year that the vesting date occurs, and no later than two and one-half months after the calendar year in which vesting occurs.~~

~~Section 9A — Performance Awards and Additional Shares in General~~

~~(a)~~ ~~Performance Period and Goals.~~~~At the time of grant of a Performance Award, the Committee shall establish one or more performance periodsof no less than twelve (12) months~~with respect to such Performance Award. If the Award is granted during the first fiscal quarter of the Company’s fiscal year, the performance period will commence on the first day of that fiscal year and can also be based on the calendar years. For grants made after the first fiscal quarter of the Company’s fiscal year, the Committee can also use the performance period that starts on the first day of the fiscal year or calendar year, pro-rated as determined by the Committee. Otherwise, the performance period will commence on the date of grant or such other period selected by the Committee. At the time of grant of the Performance Award, the Committee shall also establish one or more business performance goals for the performance period and, if it establishes more than one, the weight to be given each such goal (collectively, “performance goals”). The initial performance goals with respect to a Performance Award may be modified or adjusted during the performance period in light of previously unforeseen transactions, events or circumstances occurring after the initial performance goals are established. All performance goals shall be subject to the approval of the Board.

~~(b)~~ ~~Performance Assessment, Vesting and Forfeiture.~~As soon as practicable after the end of a performance period for a Performance Award, the Committee shall determine the extent to which the performance goals for that Award were attained. Subject to the terms of any applicable award agreement (which terms shall govern), if the grantee of a Performance Award remains an Employee throughout the applicable performance period, and any other conditions imposed by the Committee are satisfied, the Performance Award (or any applicable portion thereof based on the extent the performance-goals are satisfied) shall become vested according to its terms and no longer subject to forfeiture at the end of the applicable performance period. If the grantee ceases to be an Employee during the performance period due to his or her death, Disability or termination by the Company without Cause, then shortly after termination of employment~~or service~~for these reasons (but not earlier than after the applicable performance periods are completed and the date the Committee determines that the performance goals are attained) the grantee shall be entitled to receive a pro-rata portion of the portion of the Performance Award that would have otherwise vested if his or her employment~~or service~~had continued until the end of such performance period, based on the portion of the performance period that the grantee was employed by the Company, and the remainder of such Performance Award shall be forfeited, unless the Committee determines to waive such forfeiture in whole or in part; provided, however, that in the event of a termination by the Company without Cause, the Committee has no such discretion to waive such forfeiture if the grantee is a Named Executive Officer or an individual that the Committee reasonably believes may become a Named Executive Officer and designates the Performance Award as subject to Section 162(m)’s requirements (a “~~Prospective NEO~~”). In the event of termination by the Company without Cause, the grantee must be employed for at least one year after the date the grants were approved to be entitled to a pro rata award. If a grantee who is not a Named Executive Officer otherwise ceases to be an Employee during the applicable performance period for any reason other than death, Disability, or termination by the Company without Cause, or other than following normal retirement, as defined by the Committee, the Committee shall determine the disposition of the Performance Award. If~~Except as stated in the applicable award agreement, if~~ ~~a grantee who is a Named Executive Officer otherwise ceases to be an Employee during the performance period for any reason other than death, Disability termination by the~~

Company without Cause, or following normal retirement, as defined by the Committee, the Performance Award will be forfeited in its entirety. Performance Awards that vest shall be settled during the year that the vesting date occurs, and no later than two and one-half months after the year in which vesting occurs.

~~(c)~~ ~~Additional Shares.~~ At the end of the performance period, the Committee may recommend a grant of Additional Shares to the grantee of a Performance Award that is settled in Company Stock if the grantee is then an Employee and is not a Named Executive Officer, and the Committee determines that satisfaction of the performance goals so warrants. Additional Shares awarded to a grantee shall be immediately vested and shall be issued to the grantee as soon as practicable after the grant.

~~(d)~~ ~~Other Matters.~~ The provisions of Section 8(d) of the Plan shall also apply to Performance Shares, and the provisions of Section 8(e) shall also apply to Performance Share Units. The Committee may make interim grants of Awards to new Employees in a fair and equitable manner. The Committee may, in its sole discretion, settle any vested and payable Other Performance Award (1) entirely in cash, (2) to the extent possible, in whole shares of Company Stock and the balance in cash, or (3) partially in cash in an amount specified by the Committee and the balance in whole shares of Company Stock. For purposes of settlement, shares of Company Stock shall be valued at their Fair Market Value as of the settlement date.

~~Section 9B — Performance Awards to Named Executive Officers~~

~~(a)~~ ~~Special Provisions Applicable.~~ Notwithstanding other provisions of the Plan, the provisions of this Section 9B shall apply to all Performance Awards granted to Named Executive Officers that are intended to qualify as “qualified performance-based compensation” and that are not subject to the tax deduction limit imposed by Section 162(m). Except as superseded by this Section 9B and unless otherwise stated, all provisions of the Plan applicable to Performance Awards shall also apply to such Performance Awards granted to Named Executive Officers.

~~(b)~~ ~~Timing of Grants.~~ ~~Performance Awards may be granted to Named Executive Officers only during the first 90 days of the Company’s applicable performance period, except in limited circumstances. .~~

~~(c)~~ ~~Performance Objectives and Payout Schedules.~~ At or prior to the grant of each Performance Award to a Named Executive Officer or Prospective NEO, the Committee shall establish one or more objectively determinable performance goals (which may be annual, cumulative or based on some other portion of the performance period) for the Award relating to one or more or any combination of the following areas of Company or other business unit performance~~, either in absolute terms or relative to the performance of one or more other companies or an index covering multiple companies,~~ ~~over the relevant performance period.~~

(i) Earnings (which includes net profits, operating profits, operating earnings, and net income, and which may be calculated before or after taxes, interest, depreciation, amortization or taxes, as specified at the time of the any Performance Award is granted) or earnings per share of Company Stock;

~~(ii) Revenues;~~

~~(iii) Gross Profits;~~

~~(iv) Cash flow;~~

~~(v)Return on revenues, gross profits, sales, assets or equity;~~

~~(vi) Customer or employee retention;~~

~~(vii)Customer satisfaction;~~

~~(viii) Expenses or expense levels;~~

~~(ix) One or more operating ratios;~~

~~(x)Stock price;~~

~~(xi) Market share;~~

~~(xii)Capital expenditures;~~

~~(xiii) Net borrowing, debt leverage levels, credit quality or debt ratings;~~

~~(xiv) The accomplishment of mergers, acquisitions, dispositions, public offerings or similar extraordinary business transactions;~~

~~(xv) The Company’s Quality Management System;~~

~~(xvi) Shareholder return;~~

~~(xvii) Organizational health/productivity;~~

~~(xviii) Sales volume; and/or~~

~~(xix) Brand or product recognition/acceptance~~

At the same time, the Committee shall establish a payout schedule for the Performance Award, which shall be a predetermined range from threshold performance amount or level of the target Other Performance Award, Performance Shares and/or Performance Share Units constituting the Award (if actual Company results for the period do not at least equal threshold performance amount or level specified by the Committee, then payout will be zero) to maximum performance amount or level of such Award (if actual Company results for the performance period at least equal the threshold performance goal(s) established) and shall be structured so as to permit objective determination of payouts over the full range of actual Company results. At the time any Performance Award is granted, the Committee shall specify which (if any) types or categories of extraordinary, unusual, non-recurring, or other items or events shall be excluded or otherwise not fully taken into account when actual Company results relating to such goal(s) are calculated, and the only adjustments in actual Company results which thereafter shall be permissible for purposes of applying the established payout schedule for the Performance Award shall be objectively determinable adjustments for the items or events so specified.

~~(d)~~~~No Discretion to Increase Awards or Waive Forfeitures.~~ The Committee may establish other preconditions to payout of a Performance Award to a Named Executive Officer, including preconditions that may call for subjective determinations by the Committee. The otherwise scheduled payout on any Performance Award

granted to a Named Executive Officer may be reduced by the Committee to the extent it deems appropriate if, in the Committee’s judgment, the Named Executive Officer’s individual performance during the performance period has not warranted the scheduled payout. However, for so long as Code Section 162(m) may require, the payout on any Performance Award granted to a Named Executive Officer that is intended to qualify as “qualified performance based compensation” shall not exceed the payout permissible under the Award’s payout schedule, and no Additional Shares or additional cash amount shall be granted to any Named Executive Officer.

~~(e)~~ ~~Promotions and New Hires.~~ With respect to a Named Executive Officer who is newly hired or is promoted by the Company during a performance period, the Committee shall grant a Performance Award, or adjust a Performance Award previously granted, to such Named Executive Officer for such performance period pursuant to the provisions of this Section 9B(e); provided, however, that no Performance Award shall be granted or adjusted in such a manner as to cause any such award to fail as “qualified performance-based compensation” within the meaning of section 162(m)(4)(C) of the Code and Section 1.162-27 of the Treasury Regulations promulgated thereunder.

~~(i)~~. Pro-Rated Performance Awards for Newly-Eligible Executives. A Named Executive Officer who is granted an Performance Award more than 90 days after the beginning of the performance period, either because the Named Executive Officer is newly hired or is promoted into a Named Executive Officer position, will be granted a Performance Award under the Plan for such performance period based on the number of maximum, target, and threshold levels established by the Committee during the first 90 days of the performance period for similar Employees at the new or promoted Named Executive Officer’s award level, with the number of maximum, target, and threshold number of shares that can be earned at each level pro-rated based on the ratio of the number of full months remaining in the performance period on and after the date of hire or promotion (as applicable) to the total number of months in the performance period. For any award grade created between the award grades for which the Committee has established the maximum, target, and threshold levels, straight-line interpolation shall be used to determine the pro-rated number of maximum, target, and threshold shares in accordance with this Section 9B(e).

~~(ii)~~.Adjustments to Outstanding Performance Awards. If a Named Executive Officer is promoted after the beginning of a performance period, such Employee’s outstanding Performance Award granted for such performance period will be adjusted, effective as of the date of such promotion, based on the number of maximum, target, and threshold levels established by the Committee during the first 90 days of the Performance Period for such Employee’s award level. The adjustments to each such Named Executive Officer’s Performance Award shall be pro-rated on a monthly basis, with the number of maximum, target, and threshold shares for the Employee’s original position and the original achievement levels applicable for the number of full months preceding the effective date of the promotion and the number of maximum, target, and threshold shares for the Employee’s new position applicable and the revised achievement levels for the remaining number of months in the performance period. For any award created between the levels for which the Committee has established the number of maximum, target, and threshold shares as described above, straight-line interpolation shall be used to determine the pro-rated number of maximum, target, and threshold shares in accordance with this Section 9B(e).

~~(iii)~~. Negative Discretion. Notwithstanding any other provision of this Section 9B(e), the Committee retains the discretion to reduce the amount of any Performance Shares, including a reduction of such amount to zero. By way of illustration, and not in limitation of the foregoing, the Committee may, in its discretion, determine (A) not to grant a pro-rated Performance Award pursuant to Section 9B(e), (B) not to adjust an outstanding Performance Award pursuant to Section 9B(e), (C) to grant a pro-rated

Performance Award in a smaller amount than would otherwise be provided by Section 9B(e), or (D) to adjust an outstanding Performance Award to produce a smaller award than would otherwise be provided by Section 9B(e), above.

~~(f)~~~~Certification by Committee.~~As soon as practicable following the completion of the performance period applicable to a Performance Award, the Committee shall certify in writing the extent to which the applicable performance goals have been attained and the resulting final value of the Award earned by the Named Executive Officer.

~~Section 10 — Foreign Awards~~

~~The Committee may modify the terms of any type of Award described in Sections 6, 7, 8 or 9A of the Plan for grant to an Employeeor Director~~who is subject to tax or similar laws of a country other than the United States and may grant such modified Award, and structure and grant other types of awards related to appreciation in value of Company Stock, to such an Employee ~~or Director~~, as the Committee determines necessary or advisable in order to provide such grantee with benefits and incentives comparable (to the extent practically possible) to those which would be provided the grantee if the grantee were not subject to such foreign laws. Notwithstanding the foregoing, if the Employee ~~or Director~~ is also subject to Code Section 409A, the modifications of any type of Award described in Sections 6, 7, 8, or 9A of the Plan, or the structure of other types of awards related to appreciation in value of Company Stock may not be made in a manner that would cause non-compliance with Code Section 409A.

~~Section 11 — Other Stock-Based Awards~~

~~(a)~~~~General.~~The Committee may, in its sole discretion, grant Awards of Company Stock or Awards that are valued in whole or in part by reference to, or are otherwise based on the Fair Market Value of Company Stock (“~~Other Stock-Based Awards~~”). Such Other Stock-Based Awards shall be in such form, and dependent on such conditions, as the Committee shall determine including, without limitation, the right to receive one or more shares of Company Stock (or the equivalent cash value of such shares) upon the completion of a specified period of service, the occurrence of an event, the attainment of performance objectives and/or other criteria specified by the Committee. Other Stock-Based Awards may be granted alone or in addition to any other Awards granted under the Plan. Subject to the provisions of the Plan, the Committee shall determine to whom and when Other Stock-Based Awards will be made; the number of shares to be awarded under (or otherwise related to) such Other Stock-Based Awards; whether such Other Stock-Based Awards shall be settled in cash, Company Stock or a combination of cash and Company Stock; and all other terms and conditions of such Awards (including, without limitation, the vesting provisions thereof). If an Other Stock-Based Award is intended to qualify as “qualified performance-based compensation” under Code Section 162(m), all requirements set forth in Section 9B that otherwise apply to Performance Awards must also be satisfied with respect to such Other Stock-Based Award in order for a grantee to be entitled to payment. Other Stock-Based Awards must provide either that they will be paid no later than 2 1/2 months after the end of the year in which they vest or that they will be paid in a lump-sum payment at a specified time, within the meaning of Treasury Regulation Section 1.409A-3(i)(1)(i).

~~(b)~~ ~~Director Awards.~~In addition to any other Award that might be granted to a Director, each Director who is elected at the annual stockholders meeting, whose term continues thereafter, or who is elected between annual stockholders meetings shall receive a portion of his or her Annual Retainer (or pro-rated Annual Retainer for a Director elected between annual stockholders meetings) in the form of Company Stock in a percentage (up to a maximum of 100%) of the Annual Retainer as determined from time to time by the Board.

Unless deferred pursuant to a deferral program adopted by the Company for Directors, with respect to those Directors elected at the annual meeting of stockholders, or whose term continues thereafter, the portion of the Annual Retainer to be paid in the form of Company Stock shall be paid on the first business day next following the date of the annual meeting of stockholders, and with respect to any Director elected to the Board between annual meetings, the portion of the Annual Retainer to be paid in the form of Company Stock will be paid on the first business day following his or her election to the Board (each an “Issue Date”).

Unless otherwise determined by the Board, the number of shares of Company Stock issued to a Director in accordance with Section 11(b) shall be determined by multiplying (x) the Annual Retainer (or pro-rated Annual Retainer for a Director elected between annual stockholders meetings) provided to such Director for the year by (y) the percentage established by the Board in accordance with Section 11(b) for the year and dividing the product of (x) and (y) by the Fair Market Value of a share of Company Stock on the Issue Date. Fractional shares resulting from this formula shall be rounded, up or down, to the nearest whole share at the sole discretion of the Board.

~~The Board shall determine whether any Award to Directors shall be subject to any restrictions consistent with Section 8 or Section 9A.~~

(c) At the time of the grant of Awards to Employees pursuant to Section 11(a), the Committee shall require a period of no less than twelve (12) months of continued service by an Employee following the date of grant, except as otherwise provided in the Award or this Plan for death, Disability, or pursuant to Section 15, or with respect to 5 percent (5%) of the maximum number of shares of Company Stock that may be issued or delivered pursuant to Section 5.

~~Section 12 — Certain Provisions Generally Applicable to Awards~~

~~(a)~~~~Award Agreements.~~ Each Award (other than any award of Additional Shares and any similar Foreign Award unless the Committee otherwise determines) shall be evidenced by a written agreement setting forth the type, amount and other terms and conditions of such Award, as are not inconsistent with the Plan as the Committee shall have specified with respect to such Award.

~~(b)~~ ~~Transfer Restrictions; Potential Forfeiture.~~ No Option or SAR, no Other Stock-Based Award, no unvested Performance Award or Restricted Award, no Foreign Award similar to any of the foregoing, and none of the rights or privileges conferred by any such Award may be sold, assigned, pledged, hypothecated or otherwise transferred in any manner whatsoever, except that, if the Committee determines that such transfer will not violate any requirements of the Securities and Exchange Commission or the Internal Revenue Service, the Committee may permit an intervivos transfer by gift to or for the benefit of a family member of the grantee. Any attempt to sell, assign, pledge, hypothecate or otherwise transfer any such Award or any of the rights and privileges conferred thereby contrary to the provisions of the Plan shall be void and unenforceable against the Company.

~~(c)~~~~Overriding Precondition; Potential Forfeiture.~~ It shall be an overriding precondition to the vesting of each Performance Award, Restricted Award, Other Stock-Based Award, and similar Foreign Award and the exercisability of each Option, SAR and similar Foreign Award: (1) that the grantee of such Award not engage in any activity that, in the opinion of the Committee, is in competition with any activity of the Company or any Affiliated Entity or is otherwise inimical to the best interests of the Company and that has not been approved by the Board or the Committee and (2) that the grantee furnish the Committee with all the information confirming satisfaction of the foregoing condition that the Committee reasonably requests. If the Committee determines that

a grantee has engaged in any activity prohibited by the foregoing conditions, all of the grantee’s then outstanding Options, SARs and similar Foreign Awards shall immediately be cancelled, and all of the grantee’s then unvested Restricted Awards, Performance Awards, Other Stock-Based Awards, and similar Foreign Awards shall immediately be forfeited.

For this purpose, the Awards shall state that the grantee agrees that for a period of twelve (12) months after a grantee’s termination of employment, the grantee shall not directly or indirectly, individually, or as a director, employee, officer, principal, agent, or in any other capacity or relationship, engage in any business or employment, or aid or endeavor to assist any business or legal entity that is in direct competition with the business of the Company as then being carried out (provided, however, that notwithstanding anything to the contrary contained in this~~AgreementPlan~~, a grantee may own up to two percent (2%) of the outstanding shares of the capital stock of a company whose securities are registered under Section 12 of the Securities Exchange Act of 1934). A Grantee will acknowledge that Company has operations in all 50 states, the District of Columbia and at least twenty-nine other countries, that the Company’s strategic plan is to continue to expand its operations and presence both domestically and internationally and that grantee’s services are integral to these operations and expansion plans.

In addition, during grantee’s employment with the Company, and any subsidiary thereof, and during the twelve (12) month period following any termination of grantee’s employment for any reason, grantee shall not, except in the course of carrying out his~~or her~~duties hereunder, directly or indirectly induce any employee of the Company or any of its subsidiaries to terminate employment with such entity, and shall not directly or indirectly, either individually or as owner, agent, employee, consultant or otherwise, knowingly employ or offer employment to any person who is or was employed by the Company or a subsidiary thereof unless such person shall have ceased to be employed by such entity for a period of at least six (6) months.

~~Grantee shall not, directly or indirectly, during hisor heremployment with the Company and during the twelve (12) month period following any termination of grantee’s employment for any reason engage in any Solicitation.~~

Grantee shall not disparage, slander or injure the business reputation or goodwill of the Company in any material way, including, by way of illustration, through any contact with vendors, suppliers, employees or agents of the Company which could harm the business reputation or goodwill of the Company.

The Company has advised the grantee and the grantee acknowledges that it is the policy of the Company to maintain as secret and confidential all Protected Information, and that Protected Information has been and will be developed at substantial cost and effort to the Company. All Protected Information shall remain confidential permanently, and the grantee shall not, at any time, directly or indirectly, divulge, furnish, or make accessible to any person, firm, corporation, association, or other entity (otherwise than as may be required in the regular course of the grantee’s employment with the Company), nor use in any manner, either during the term of employment or after termination, at any time, for any reason, any Protected Information, or cause any such information of the Company to enter public domain.

~~In the event of a violation of this provision, Company retains all rights to seek monetary damages against a grantee or to seek other equitable remedies against the grantee.~~

~~For purposes of this Section 12(c), “grantee” refers only to Employees.~~

~~(d)~~ ~~Tax Withholding; Notice to Company of Certain Actions.~~Whenever cash is to be paid pursuant to the settlement of an Award, the Company shall have the right to deduct therefrom an amount sufficient to satisfy any federal, state and local withholding tax requirements related thereto.

The Committee may provide, on request of a grantee, for withholding of otherwise issuable shares upon the grant, exercise, vesting or settlement of Awards or for the tender of other shares of Company Stock owned by such grantee or holder in order to satisfy tax withholding obligations arising in connection with the grant, exercise, vesting or settlement of an Award. If the Committee grants such elections, it may condition, limit or qualify them in any manner it deems appropriate.

If any grantee shall, in connection with the acquisition of shares of Company Stock under the Plan, make the election permitted under Code Section 83(b) (i.e., an election to include in gross income in the year of transfer the amounts specified in Code Section 83(b)), the grantee shall notify the Company of such election within ten days of filing notice with the Internal Revenue Service, in addition to any filing and notification required pursuant to regulations issued under the authority of Code Section 83(b).

~~(e)~~ ~~Stockholder Status.~~ The grantee of an Award, and other persons to whom the Award or the grantee’s rights thereunder may pass, shall have no rights or privileges of a holder of shares of Company Stock, in respect of any shares issuable pursuant to or in settlement of such Award, unless and until certificates representing such shares have been issued in their name(s).

~~Section 13 — No Right to Employment or Award~~

~~No person shall have any claim or right to be granted an Award. The grant of an Award shall not confer upon any Employeeor Directora right with respect to continued employmentor service~~by the Company or an Affiliated Entity. Further, the Company and each Affiliated Entity reaffirms its at-will employment relationship with its Employees and expressly reserves the right to dismiss a grantee at any time free from any liability or claim, except as provided under this Plan.

~~Section 14 — Adjustments upon Changes in Capitalization~~

In the event of a stock split, stock dividend, reverse stock split, combination of shares or conversion or exchange of voting shares for non-voting shares, the Board shall make a proportionate adjustment to the number and kind of shares available for issuance in the aggregate and to any individual under and pursuant to the Plan (including the settlement of ISOs), the number and kind of shares covered by outstanding Options and the per share exercise price of such Options, the numbers of outstanding SARs and Share Units and the terms of Foreign Awards. In the event of a reorganization or recapitalization, merger, consolidation or similar transaction involving the Company, a rights offering or any other change in the corporate or capital structure of the Company (other than as provided in the immediately preceding sentence), the Board shall make such adjustments as it may deem appropriate in the number and kind of shares available for issuance in the aggregate and to any individual under and pursuant to the Plan (including in settlement of ISOs), the number and kind of shares covered by outstanding Options and the per share exercise price of such Options, the numbers of outstanding SARs and Share Units and the terms of Foreign Awards. Any adjustment with respect to an ISO in connection with a transaction to which Section 424(a) of the Code (or its successor) applies shall be made in accordance therewith unless the Board specifically determines otherwise. Notwithstanding the foregoing, the Board shall not make any adjustment to the number of shares covered by outstanding Options or the per share exercise price of such Options or the number of outstanding SARs that would cause the exercise price to be less than the Fair Market Value of the underlying shares on the date the Option or SAR was granted or cause the number of shares subject to the Option or SAR to be other than fixed on the original date of grant of the Option or SAR.

~~Section 15~~ ~~Change In Control~~

~~(a)~~~~Committee Discretion~~. The Committee may, in its sole discretion and without the consent of a grantee of an Award, either by the terms of the Award or by resolution adopted prior to the occurrence of a Change in Control, determine whether and to what extent outstanding Awards under the Plan shall be assumed, converted or replaced by the resulting entity in connection with the Change in Control (or, if the Company is the resulting entity, whether such Awards shall be continued by the Company), in each case subject to equitable adjustments in accordance with Section 14 of the Plan.

~~(b)~~ ~~Awards that are Assumed.~~ To the extent outstanding Awards granted under the Plan are assumed, converted or replaced by the resulting entity in the event of a Change in Control (or, if the Company is the resulting entity, to the extent such Awards are continued by the Company) as provided in Section 15(a) of the Plan, then, except as otherwise provided in the applicable Award or in another written agreement with the grantee, or in a Company severance plan, if any:

(i) Any such outstanding Awards that are subject to performance goals shall be converted to service-based Awards by the resulting entity based on the shares of Company Stock payable as if the “target” level performance goal had been achieved, and such converted Awards shall continue to vest and become exercisable or be paid (as applicable) based on continued service during the remaining vesting period;

~~(ii) All other such outstanding Awards shall continue to vest and become exercisable or be paid (as applicable) based on continued service during the remaining vesting period, if any; and~~

(iii) Notwithstanding the foregoing, if the Employee’s employment is involuntarily terminated without Cause within two years after such Change in Control, all such outstanding Awards shall become vested and exercisable or be paid (as applicable) in full, effective as of the date of such termination, and any such Awards that are Options or Stock Appreciation Rights shall be cancelled in accordance with Section 15(d) as of the date of termination of employment.

~~(c)~~ ~~Awards that are not Assumed.~~ To the extent outstanding Awards granted under the Plan are not assumed, converted or replaced by the resulting entity in connection with a Change in Control (or, if the Company is the resulting entity, to the extent such Awards are not continued by the Company) in accordance with Section 15(a) of the Plan, then, except as otherwise provided in the applicable Award or in another written agreement with the grantee, or in a Company severance plan, if any, then, effective immediately prior to the Change in Control:

(i) All service-based and performance-based vesting restrictions with respect to all such outstanding Awards shall lapse, with any applicable performance goals deemed to be satisfied as if “target” performance had been achieved, and all such Awards shall become fully vested and exercisable or be paid, as applicable, effective as of the date of such Change in Control; and

~~(ii) All such outstanding Awards that are Options or Stock Appreciation Rights shall be cancelled in accordance with Section 15(d) effective on the Change in Control.~~

~~(d)~~ ~~Cancellation Right.~~ The Committee may, in its sole discretion and without the consent of the grantee of an Award, either by the terms of the Award or by resolution adopted prior to the occurrence of the Change in Control, provide that any outstanding Award (or a portion thereof) shall, upon the occurrence of such Change in Control, be cancelled in exchange for a payment in cash or other property (including shares of the resulting entity in connection with a Change in Control) in an amount equal to the excess, if any, of the Fair Market Value of the shares subject to the Award, over any exercise price related to the Award, which amount may be zero if the Fair Market Value of a share on the date of the Change in Control does not exceed the exercise price per share of the applicable Awards.

~~(e)~~ ~~Miscellaneous~~.

~~(i) Any action or determination to be taken by the Committee pursuant to this Section 15 in connection with a Change in Control shall be taken prior to such Change in Control.~~

(ii) For purposes of Section 15(b), the cancellation of an Award and subjecting a cash equivalent amount to the remaining vesting schedule based on continued service will be treated as a conversion of an Award that is assumed.

~~(f)~~~~Section 409A.~~Notwithstanding any provision of this Plan to the contrary, and except as otherwise provided in the Award, if (i) an Award is considered a “deferral of compensation” (within the meaning of Section 409A of the Code), (ii) the Award becomes vested or restrictions lapse, expire or terminate upon the occurrence of a Change in Control, and (iii) either such Change in Control is not treated as a “change in ownership” of the Company, a “change in the effective control” of the Company or a “change in the effective ownership of a substantial portion of the assets” of the Company (within the meaning of Section 409A of the Code) or payment of the Award is not otherwise permitted upon the Change in Control under Section 409A of the Code without the imposition of taxes and penalties, then even though such Award may be deemed to be vested or restrictions lapse, expire or terminate upon the occurrence of the Change in Control, payment of the vested Award will be made, ~~to the extent necessary~~to comply with the provisions of Section 409A of the Code, to the grantee on the earliest of: (A) the grantee’s “separation from service” with the Company (as defined for Section 409A of the Code), provided that if the grantee is a “specified employee” (determined pursuant to the Company’s policy for determining specified employees in accordance with Section 409A of the Code), the payment date shall be the first day of the seventh (7th) month after the date of the grantee’s separation from service; (B) the date payment otherwise would have been made in the absence of any provisions in this Plan to the contrary (provided such date is permissible under Section 409A of the Code); or (C) the grantee’s death.

(g) Nonapplication to Fully Vested Awards. This Section 15 shall not apply to any Other Stock-Based Awards or Director Awards granted pursuant to Section 11 that are not subject to any vesting restriction and payment is deferred pursuant to the Company’s Management Retirement Plan or the Non-Employee Directors Deferred Compensation Plan.

~~Section 16~~ ~~— Duration, Amendment, Suspension and Termination~~

The Plan shall become effective upon approval by the Board, subject to approval of the stockholders of the Company, and shall continue in effect for a term of ten (10) years unless terminated by the Board. The Board may amend, suspend or terminate any portion or all of the Plan at any time, but no such Board action shall adversely affect the rights of any grantee or other holder of any Award then outstanding or unvested without the consent of such grantee or holder, unless such amendment or termination is necessary to comply with any applicable law, regulation or rule. Notwithstanding the foregoing, the Plan shall not be amended without the

approval of the Company’s stockholders (a) to increase the maximum aggregate number of shares of Company Stock that may be issued under the Plan (except by operation of Section 14); (b) to change the class of persons eligible to receive Incentive Stock Options; or (c) to make any other amendment that would require approval of the Company’s stockholders under any applicable law, regulation or rule~~, including any applicable Nasdaq listing standard.~~

~~Section~~ 1617 ~~— Miscellaneous Provisions~~

~~(a)~~ ~~Governing Law.~~~~The Plan shall be governed by and construed in accordance with the laws of the State of Delaware applicable to contracts made and to be performed in the State of Delaware.~~

~~(b)~~ ~~Severability.~~If any provision of the Plan or any Award is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction or as to any grantee or Award, or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to the applicable laws or if it cannot be construed or deemed amended without, in the determination of the Committee, materially altering the intent of the Plan or the Award, such provision shall be construed or deemed stricken as to such jurisdiction, grantee or Award, and the remainder of the Plan and any such Award shall remain in full force and effect.

It is intended that the Plan be applied and administered in compliance with Rule 16b-3. If any provision of the Plan would be in violation of Rule 16b-3 if applied as written, such provision shall not have effect as written and shall be given effect so as to comply with Rule 16b-3, as determined by the Board.

~~Adopted by the Board of Directors of the Company: February 7, 2005, As Amended November 6, 2006, November 8, 2007, February 18, 2010, December 31, 2011,~~~~andFebruary 12,~~~~2015.2015, and February 15, 2017.~~

q ~~PLEASE FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.~~ q


☐		Preliminary Proxy Statement

☐		Confidential, for Use of the Commission Only (as permitted by Rule14a-6(e)(2))

☒		Definitive Proxy Statement

☐		Definitive Additional Materials

☐		Soliciting Material ~~Pursuant to §240.14a-12~~under§240.14a-12



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April ~~10, 2017~~ 9, 2018				By Order of the Board of Directors

999 West Big Beaver Road				JAMES M. POLEHNA
Troy, Michigan 48084-4716				~~Vice President and~~ Corporate Secretary


Proxy Summary			7
~~Annual Meeting Details~~			7
~~How to Cast Your Vote~~Annual Meeting Details			7
How to Cast Your Vote			7
Meeting Agenda and Voting Recommendations			8
Director Nominees			9
Corporate Governance Highlights			10
~~Financial and Operating Highlights~~Company Merits			10
~~Executive Compensation~~Financial and Operating Highlights			11
~~Questions and Answers About the Proxy Statement and the Annual Meeting~~Executive Compensation Highlights			12

Proposal 1: Election of Directors			1413
Director Independence and Tenure			13
Director Qualifications, Background, and Diversity			13
Recommended Director Nominees			14
Director ~~Qualifications, Background, and Diversity~~Nominees’ Bios			14
~~Recommended Director Nominees~~			15

~~Director Nominees’ Bios~~Corporate Governance			1720
~~Corporate~~Recent Governance Review			2220
~~Controlled Company Exemption~~Board Leadership and Governance Structure			20
Committees of the Board			21
Audit Committee			21
Compensation Committee			22
~~Governance Structure~~Compensation Committee Interlocks and Insider Participation			22
~~Committees~~Corporate Governance and Nominating Committee			22
Risk Governance and Oversight			22
Risk Assessment of ~~the Board~~Employee Compensation Programs			23
~~Audit~~Board and Committee Evaluation			23
~~Compensation Committee~~			24
~~Compensation Committee Interlocks~~Code of Business Conduct and ~~Insider Participation~~Ethics			24
~~Corporate Governance~~Related Person Transactions and ~~Nominating Committee~~Certain Relationships			24
~~Risk Governance and Oversight~~Corporate Social Responsibility			24
~~Risk Assessment of Employee Compensation Programs~~			25

~~Board and Committee Evaluation~~Director Compensation			26
~~Code~~Beneficial Ownership of ~~Business Conduct and Ethics~~Shares			2628
~~Corporate Social Responsibility~~			26
~~Director Compensation~~			27
~~Securities Beneficially Owned by Principal Stockholders and Management~~			28
Section 16(a) Beneficial Ownership Reporting Compliance			29

Proposal 2: Advisory Vote to Approve the Company’s Executive Compensation			30
Compensation Discussion and Analysis			31
~~Named Executive Officers~~			31
2017 Named Executive ~~Summary~~Officers			31
~~Fiscal 2016 Performance~~Executive Summary			31
Fiscal 2017 Performance			31
Key Executive Compensation Program Highlights for Fiscal ~~2016~~2017			32
~~2016~~2017 STIP Design and Results			32
~~2016-2018 LTI Design~~			33
~~2014-2016~~2017-2019 LTI ~~Plan~~Design			33
~~2016 Base Salary Decisions~~2015-2017 LTI Results			3334


~~Pay for Performance Framework~~			34
CEO and Other Named Executive Officers Pay Mix			3435
Elements of Compensation for Named Executive Officers			36
~~2017~~2018 Executive Incentive Plans – Overview ~~of Changes~~			36
~~Process for Determining Executive Compensation~~			37
~~Role of the~~Process for Determining Executive Compensation ~~Committee~~			37
Role of the ~~Independent~~ Compensation ~~Consultant~~Committee			37
Role of ~~Management~~the Independent Compensation Consultant			37
Role of Management			37
Comparator Data			38
~~Executive Officer Performance Reviews and Succession Planning~~Tally Sheets			39
~~Compensation Programs: Decisions~~Executive Officer Performance Reviews and ~~Actions in 2016~~Succession Planning			39
~~Base Salary~~Compensation Programs: Decisions and Actions in 2017			39
~~Annual Cash Incentive~~Base Salary			40
~~Long-Term Incentives~~Annual Cash Incentive			4240
~~Performance Shares~~Long-Term Incentives			43
~~Restricted Stock~~			44
~~Long-Term Incentive for 2014-2016~~Performance Shares			45
~~Retirement Benefits~~Restricted Stock			45
~~Health and Welfare Benefits~~			46
~~Perquisites~~Long-Term Incentive for 2015-2017 Performance Results			46
~~Executive Severance Plan~~Retirement Benefits			47
~~Executive Compensation Governance~~			47
~~Annual Say on Pay Vote~~Health and Welfare Benefits			47
~~Stock Ownership and Retention Requirements~~			47
~~Incentive Compensation Recovery (“Clawback”) Policy~~			48
~~Hedging and Pledging of Shares~~Perquisites			48
~~Tax and Accounting Implications~~Senior Executive Severance Plan			48
~~Deductibility of Executive Compensation~~General Severance Plan			48
~~Compensation Committee Report~~			49
~~Summary~~Governance of Executive Compensation ~~Table 2016~~Programs			49
Annual Say on Pay Vote			49
Executive Stock Ownership and Retention Requirements			49
Incentive Compensation Recovery (“Clawback”) Policy			49
Hedging and Pledging of Shares			50
Tax and Accounting Considerations			50
Deductibility of Executive Compensation			50
Compensation Committee Report			50
2017 Executive Compensation Tables			51
Summary Compensation Table 2017			51
Grants of Plan-Based Awards ~~2016~~2017			52
~~Outstanding Equity Awards at Fiscal Year End 2016~~			53
~~Option Exercises and Stock Vested 2016~~Outstanding Equity Awards at Fiscal Year End 2017			54
~~Nonqualified Deferred Compensation 2016~~Option Exercises and Stock Vested 2017			54
~~Potential Payments Upon Termination 2016~~			55
~~Summary of Potential Payments~~Nonqualified Deferred Compensation 2017			55
~~Executive Severance Plan~~Potential Payments Upon Termination 2017			5556
*~~Proposal 3: Advisory Vote to Approve the Frequency~~Summary of ~~Future Voting on the Company’s Executive Compensation~~Potential Payments*			5856
*~~Proposal 4: Approve the Amended and Restated Equity Incentive~~Senior Executive Severance Plan*			5956
General Severance			57
Treatment of Long-Term Inventive Awards			58

CEO Pay Ratio			61

Proposal 3: Approve the amendment and restatement of the Company’s Certificate of Incorporation to eliminate certain obsolete provisions, to eliminate a “stakeholder provision” that could conflict with Delaware law, and to make additional revisions in the interests of modernization			63
Implementation of Amendments			63


2017 Base Salary Decisions			34
Executive Compensation Philosophy, Objectives, and Design			34
Pay for Performance Framework			34


Required Vote			63

Proposal 4: Approve an amendment to the Company’s Amended and Restated Bylaws to designate the Delaware Chancery Court as the exclusive forum for certain legal actions			64
Implementation of Amendment			64
Required Vote			65

Proposal 5: Ratification of the Appointment of PricewaterhouseCoopers LLP as the Company’s Independent Registered Public Accounting Firm for the ~~2017~~2018 Fiscal Year			66
Audit and Non-Audit Fees			7266

Audit Fees			66
Audit Related Fees			66
Tax Fees			66
All Other Fees			66
Report of the Audit Committee			67

Questions and Answers About the Proxy Statement and the Annual Meeting			68

Annex A			70


~~Audit andNon-Audit~~ ~~Fees~~			72
~~Audit Fees~~ 6			72
~~Audit Related Fees~~			72
~~Tax Fees~~			73
~~All Other Fees~~			73
~~Report of the Audit Committee~~			73
~~Exhibit A~~			74



Date:	~~2017 ANNUAL MEETING OF SHAREHOLDERS~~Wednesday, May 9, 2018

Time:	~~Date:~~	~~Wednesday, May 10, 2017~~

	~~Time:~~	11:00 a.m., Eastern Daylight Time

Place:	~~Place:~~	Kelly Services, Inc., 999 West Big Beaver Road, Troy, Michigan 48084-4716

Record Date:	~~Record Date:~~	Close of Business, Eastern Daylight Time, March ~~20, 2017~~ 19, 2018

Voting:	~~Voting:~~	~~Shareholders~~Stockholders as of the Record Date are entitled to vote. Each share of Class B common stock is entitled to one vote for each Director Nominee and one vote for each of the other proposals to be voted on.

	Admission:	All holders of the Company’s Class A and Class B common stock are invited to attend the Annual Meeting of ~~Shareholders,~~Stockholders, but only holders of record of the Company’s Class B common stock atas of the ~~close of business on March 20, 2017~~Record Date are entitled to notice of and to vote at the Meeting.


	~~Internet at~~ ~~www.envisionreports.com/kelyb~~
	QR code -
Internet at	Scan and vote	Calling 1-800-652-VOTE (8683)	Mail -
www.envisionreports.com/kelyb	with your mobile ~~device~~	~~Calling1-800-652-VOTE~~ ~~(8683)~~ within the U.S., U.S. territories &	Return the signed
	device	Canada on a touch tone telephone	~~Mail -~~ ~~Return the signed~~ proxy card


~~MEETING AGENDA AND VOTING RECOMMENDATIONS~~ Voting Matters
	~~Voting Matters~~Board’s Recommendation		~~Board’s~~ ~~Recommendation~~		Page Reference (for more detail)
Proposal 1.		Election of ~~nine~~ten Directors		✓ FOR Each Nominee	14	13

Proposal 2.		Advisory vote to approve the Company’s Executive Compensation		✓ FOR		30

Proposal 3.		~~Advisory vote to approve annual (once every year) voting on~~Amendment and restatement of the Company’s ~~Executive Compensation~~Certificate of Incorporation to eliminate certain obsolete provisions, to eliminate a “stakeholder provision” that could conflict with Delaware Law, and to make additional revisions in the interest of modernization		✓ FOR	58	63

Proposal 4.		~~Amended~~An Amendment to the Company’s amended and ~~Restated Equity Incentive Plan~~ restated Bylaws to designate the Delaware Chancery Court as the exclusive forum for certain legal actions		✓ FOR	59	64

Proposal 5.		Ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the ~~2017~~2018 fiscal year		✓ FOR	72	66


Name	Age		Director Since	Principal Occupation	Independent	Committee Memberships	Other Public Company Boards
Terence E. Adderley		83	1962	Executive Chairman and Chairman of the Board of Directors, Kelly Services, Inc. (1998 – present).	No	Governance		-
Carol M. Adderley		57	2010	Writer and Researcher in the Humanities.	No	Governance (Vice Chair)		-
Carl T. Camden		62	2002	President and Chief Executive Officer, Kelly Services, Inc. (2006 – present); Director, Temp Holdings Co., Ltd. (2006 – present); Director, TopBuild (2015 – present).	No	-		2
Robert S. Cubbin		59	2014	President and Chief Executive Officer, Meadowbrook Insurance Group, Inc. (2002 – 2016); Director, First Merit Corporation (2013 – 2017); Director, Huntington Bancshares Incorporated (2017 – present).	Yes	Audit; Compensation (Vice Chair)		1
Jane E. Dutton		64	2004	Robert L. Kahn; Distinguished University Professor of Business Administration and Psychology, The University of Michigan Business School (2007 – present).	Yes	Compensation; Governance (Chair)		-
Terrence B. Larkin		62	2010	Executive Vice President, Business Development, General Counsel and Corporate Secretary, Lear Corporation (2008 – present).	Yes	Audit (Vice Chair); Compensation		-
Leslie A. Murphy		65	2008	President and CEO, Murphy Consulting, Inc. (2008 present); Certified Public Accountant Member of AICPA’s Governing Council (2008 – present); Member of NACD Advisory Council on Risk Oversight (2012 – present); Director, Detroit Legal News Company (2012 – present).	Yes	Audit (Chair); Compensation		1
Donald R. Parfet		64	2004	Managing Director, Apjohn Group, LLC (2001 present); General Partner, Apjohn Ventures Fund (2003 – present); Director, Rockwell Automation, Inc. (2008 – present); Director, MASCO Corporation (2012 present); Director, Sierra Oncology, Inc. (2015 – present).	Yes	(Lead Director); Audit; Compensation; Governance		3
Hirotoshi Takahashi		47	2015	Director, Intelligence, Ltd. (2008 present); Representative Member of Godo Kaisha Yamashiroya, (2010 – present); Vice President, Japan Association of HR Services Industry (2012 – 2016); Executive Vice President and COO, Temp Holdings Co., Ltd. (2013 – present); Director, TS Kelly Workforce Solutions Limited (2014 present); Director, JAPAN TECSEED CO.,LTD. (2016 – present).	No	-		3


Name	Age	Director Since	Principal Occupation	Independent	Committee Memberships	Other Public Company Boards
Terence E. Adderley	84	1962	Chairman of the Board of Directors, Kelly Services, Inc. (1998 – present).	No	Governance		—
Carol M. Adderley	58	2010	Writer and Researcher in the Humanities.	No	Governance (Vice Chair)		—
Gerald S. Adolph	64	2018	Director, NAACP Legal Defense and Education Fund (1998 –present); Director, Cintas Corporation (2006 – present); Director, Cardinal Spellman High School Board (2010 – present); Senior Partner and other executive positions, Booz & Co. (1981 – 2016).	Yes	—		1
George S. Corona	59	2017	President and Chief Executive Officer, Kelly Services, Inc. (2017 – present); Executive Vice President and Chief Operating Officer, Kelly Services, Inc. (2009 – 2017).	No	—		—
Robert S. Cubbin	60	2014	Director, Huntington Bancshares Incorporated (2017 – present); Director, First Merit Corporation (2013 – 2017); President and Chief Executive Officer, Meadowbrook Insurance Group, Inc. (2002 – 2016).	Yes	Audit; Compensation (Chair); Governance		1
Jane E. Dutton	65	2004	Robert L. Kahn Distinguished University Professor Emeritus of Business Administration and Psychology, The University of Michigan Business School (2017 – present); Robert L. Kahn Distinguished University Professor of Business Administration and Psychology, The University of Michigan Business School (2007 – 2017).	Yes	Compensation; Governance (Chair)		—
Terrence B. Larkin	63	2010	Executive Vice President, Business Development, General Counsel and Corporate Secretary, Lear Corporation (2008 – present).	Yes	Audit (Vice Chair); Compensation		—
Leslie A. Murphy	66	2008	President and CEO, Murphy Consulting, Inc. (2008 – present); Certified Public Accountant; Member of AICPA’s Governing Council (2008 – present); Member of NACD Advisory Councils on Audit Committee Issues and Risk Oversight (2012 – present); Director, Detroit Legal News Company (2012 – present); Director, Loop Industries, Inc. (2017 - present).	Yes	Audit (Chair); Compensation (Vice Chair)		2
Donald R. Parfet	65	2004	Managing Director, Apjohn Group, LLC (2001 – present); General Partner, Apjohn Ventures Fund (2003 –present); Director, Rockwell Automation, Inc. (2008 – present); Director, MASCO Corporation (2012 – present); Director, Sierra Oncology, Inc. (2015 – present).	Yes	(Lead Director since 2012); Audit; Compensation; Governance		3
Hirotoshi Takahashi	48	2015	Director, Deputy Vice President and COO, Persol Holdings Co., LTD. (2013 - present); Representative Member, Godo Kaisha Yamashiroya, (2010 - present); Vice President, Japan Association of HR Services Industry (2012 - 2016)	No	—		1


		Americas Staffing is local/branch-delivered staffing business in the U.S., Puerto Rico, Canada, Mexico, and Brazil.

		Global Talent Solutions (GTS) includes Kelly’s global Outsourcing and Consulting Group (OCG) business, and centralized staffing operations in the U.S., Canada, and Puerto Rico.

		International Staffing includes Kelly’s EMEA staffing business.


~~Table of Contents~~		3


	Robert S. Cubbin Age 60 Director since: 2014		Board Committees:

•			~~Robert S. Cubbin~~Audit
			~~Age: 59~~ ~~Director since: 2014~~•		~~Board Committees:~~Compensation (Chair)
		● ~~Audit~~•		● ~~Compensation (Vice Chair)~~Governance and Nominating
		Principal Occupation and Directorships:

			•		Director, Huntington Bancshares Incorporated (2017 – present)

			•		Director, First Merit Corporation (2013 – 2017)

			•		●President and Chief Executive Officer, Meadowbrook Insurance Group, Inc. (2002 -– 2016) ● ~~Director, First Merit Corporation (2013 - 2017)~~ ● ~~Director, Huntington Bancshares Incorporated (2017 - present)~~ ~~Education:~~ ● ~~Detroit College of Law, JD~~ ● ~~Wayne State University, BA, Psychology~~

		Education:

		•	Detroit College of Law, JD

		•	Wayne State University, BA, Psychology
Robert S. Cubbin is an attorney withthirty-one years of experience in insurance law. ~~He recently~~In 2016 he retired as President and Chief Executive Officer of an insurance company. He serves as a Director of one ~~publicly-held company and his~~other publicly held company. His extensive expertise in legal, insurance, management, accounting, actuarial, investment, underwriting, reinsurance, and claims experience ~~enhances~~are an asset to the ~~Board of the Company.~~Company’s Board.
	Jane E. Dutton Age: 65 Director since: 2004


•	Compensation
•	Governance and Nominating (Chair)
Principal Occupation and Directorships:
•	Robert L. Kahn Distinguished University Professor Emeritus of Business Administration and Psychology, The University of Michigan Business School (2017 – present)
•	~~Jane E. Dutton~~ ~~Age: 64~~ ~~Director since: 2004~~	~~Board Committees:~~ ● ~~Compensation~~ ● ~~Governance and Nominating (Chair)~~ ~~Principal Occupation and Directorships:~~ ●Robert L. ~~Kahn;~~Kahn Distinguished University Professor of Business Administration and Psychology, The University of Michigan Business School (2007 ~~- present)~~– 2017)
Education: ●
	•	Northwestern University, Ph.D. and MA, Organizational Behavior ● ~~Colby College, BA Sociology~~


Terrence B. Larkin Age: 6263 Director since: 2010	Board Committees: ●
	•	Audit (Vice Chair) ● ~~Compensation~~
	•	Compensation
	Principal Occupation and Directorships: ●
	•	Executive Vice President, Business Development, General Counsel and Corporate Secretary, Lear Corporation (2008 -– present)
	Education: ●
	•	Wayne State University Law School, JD cum laude ●
	•	Michigan State University, BA (High Honors), Finance

•		Compensation (Vice Chair)
Principal Occupation and Directorships:
•		President and CEO, Murphy Consulting, Inc. (2008 – present)
	•		Certified Public Accountant
	•		Member of AICPA’s Governing Council (2008 – present)
	•		Member of NACD Advisory Councils on Audit Committee Issues and Risk Oversight (2012 – present)
		•		Director, Detroit Legal News Company (2012 – present)

		•		Director, Loop Industries, Inc. (2017 – present)

		Education:


Donald R. Parfet Age: 6465 Director since: 2004	Board Committees: ●
	•	Lead Director ● ~~Audit~~
	• ● ~~Compensation~~	Audit ●
	•	Compensation
	•	Governance and Nominating
	Principal Occupation and Directorships: ●
	•	Managing Director, Apjohn Group, LLC (2001 -– present) ●
	•	General Partner, Apjohn Ventures Fund (2003 -– present) ●
	•	Director, Rockwell Automation, Inc. (2008 -– present) ●
	•	Director, MASCO Corporation (2012 -– present) ● ~~Director, Sierra Oncology, Inc. (2015 - present)~~ ~~Education:~~ ● ~~University of Michigan, MBA, Finance~~ ● ~~University of Arizona, BA, Economics~~


		•	Director, Sierra Oncology, Inc. (2015 – present)
		Education:

		•	University of Michigan, MBA, Finance

		•	University of Arizona, BA, Economics
Donald R. Parfet, ~~brings~~our Lead Director since 2012, has extensive financial and operating experiences ~~to the Board~~ as an executive with responsibilities for numerous global businesses. He now leads business development and venture capital firms focused on the development of emerging medicines. He also serves as a Director of two large publicly held companies, and as the Chairman of the Board of a small publicly held company. ~~His~~He brings to the Board global operating experience, strong financial background, and proven leadership ~~capabilities are especially important to the Board’s consideration of product and geographic expansion.~~capabilities.
	Hirotoshi Takahashi Age: 48 Director since: 2015



•	None ~~Hirotoshi Takahashi~~
	Principal Occupation and Directorships: ~~Age: 47~~
	• ~~Director since: 2015~~	~~Board Committees:~~ ● ~~None~~Director, Deputy Vice President and COO, Persol Holdings Co., LTD. (2013 - present)
	~~Principal Occupation and Directorships:~~• ● ~~Director, Intelligence, Ltd. (2008 - present)~~	●Representative Member, of Godo Kaisha Yamashiroya, (2010 - present) ●
	•	Vice President, Japan Association of HR Services Industry (2012 - 2016) ● ~~Executive Vice President and COO, Temp Holdings Co., Ltd. (2013 - present)~~ ● ~~Director, TS Kelly Workforce Solutions Limited (2014 - present)~~ ● ~~Director, JAPAN TECSEED CO.,LTD. (2016 - present)~~
		Education:

		•	~~Education:~~ ●Waseda University, BA, Department of Literature, Oriental History

	●
		A balanced structure with a mix of compensation that includes an appropriate balance of fixed and variable; cash and equity; and variable compensation that is a balance of short- and long-term incentive opportunities;


Name	Fees Earned or Paid in Cash⁽¹⁾		Stock Awards⁽²⁾		Option Awards		Non-Equity Incentive Plan Compensation		Change in Pension Value and Nonqualified Deferred Compensation Earnings		All Other Compensation		Total
T.E. Adderley		—		—		—		—		—		1,007,544	$	1,007,544	⁽³⁾
C.M. Adderley	$	100,010	$	79,990		—		—		—		—	$	180,000
G.S. Adolph	$	16,667	$	13,333		—		—		—		—	$	30,000
R.S. Cubbin	$	115,010	$	79,990		—		—	$	15,752		—	$	210,752
J.E. Dutton	$	110,010	$	79,990		—		—	$	30,354		—	$	220,354
T.B. Larkin	$	100,010	$	79,990		—		—		—		—	$	180,000
L.A. Murphy	$	120,010	$	79,990		—		—		—		—	$	200,000
D.R. Parfet	$	140,010	$	79,990		—		—		—		—	$	220,000
H. Takahashi⁽⁴⁾		—		—		—		—		—		—		—


	Class A Common Stock					Class B Common Stock
Directors and Named Executive Officers⁽¹⁾	Number of Shares and Nature of Beneficial Ownership			Percent of Class		Number of Shares and Nature of Beneficial Ownership			Percent of Class
T. E. Adderley, Chairman of the Board		1,514,686	⁽²⁾		4.2		3,213,265	⁽³⁾		93.6
C. M. Adderley, Director		340,398	⁽⁴⁾		1.0		425	⁽⁴⁾		*
G. S. Adolph, Director⁽⁵⁾		450			*		—			*
C. T. Camden, Former Director and Executive Officer		252,751			*		100			*
G. S. Corona, Director and Executive Officer		211,767			*		100			*
R. S. Cubbin, Director		14,276	⁽⁶⁾		*		100			*
J. E. Dutton, Director		27,714	⁽⁶⁾		*		100			*
T. B. Larkin, Director		23,249			*		100			*
L. A. Murphy, Director		22,695			*		100			*
D. R. Parfet, Lead Director		23,520			*		100			*
H. Takahashi, Director		1,576,169	⁽⁷⁾		4.4		1,475			*
S. S. Armstrong, Executive Officer		40,900			*		—			*
T. S. Carroll, Executive Officer		102,957			*		100			*
P. W. Quigley, Executive Officer		100,577			*		100			*
O. G. Thirot, Executive Officer		61,569			*		10			*
All Directors and Executive Officers as a Group (16 persons)		4,320,478			12.1		3,216,075			93.7


Name		Title
~~Carl T. Camden~~ George S. Corona⁽¹⁾		President and Chief Executive Officer
~~George S. Corona~~		~~Executive Vice President and Chief Operating Officer~~
Olivier G. Thirot⁽¹⁾⁽²⁾		Senior Vice President and Chief Financial Officer
Teresa S. Carroll		Executive Vice President, President, Global Talent Solutions and General Manager, Sales, Marketing and Human Resources
Peter W. Quigley		Executive Vice President, President, Global Staffing, and General Manager, Global Information Technology, Global Business Services and Global Service
Steven S. Armstrong		Senior Vice President and General Manager, ~~Global Talent Solutions~~U.S. Operations
~~Peter W. Quigley~~ Carl T. Camden⁽³⁾		~~Senior~~Former President and Chief Executive Officer


~~COMPENSATION~~ ~~ELEMENT~~		~~CONSIDERATIONS~~35		~~OBJECTIVES~~


COMPENSATION ELEMENT		TYPE		FORM	CONSIDERATIONS	OBJECTIVES

Base Salary		Fixed Compensation
~~Base Salary~~		● ~~Fixed cash compensation~~ ●• Reviewed annually and adjusted when appropriate ●• Determined based on role and scope of responsibilities, skills, experience, sustained individual ~~performance,~~contribution, and comparison to market-comparable jobs		●• Provide competitive compensation forday-to-day responsibilities ●• Attract and retain qualified Executive Officers and balance risk-taking

Short Term Incentive Plan (STIP)		VariableAt-RiskPerformance-Based Compensation

~~Short Term~~ ~~Incentive Plan~~ ~~(STIP)~~ Cash		● ~~Cash-based variable compensation~~ ●• Annual performance period ●• Target payout opportunity established as percentage of earnings for each Executive Officer based on role ●• Performance measures selected to align with our business strategy ●• Multiple performance measures ~~include a mix of Company and Business Unit metrics~~ that reflect key operational and financial measures of success • Payout based on achievement of predetermined goals ●• “Gatekeeper” goal must be achieved for any award to be earned		●• Motivate and reward Executive Officers for achievement of critical near- term performance goals that support the Company’s strategic business objectives

					Restricted Stock

		Variable~~Long Term Incentives (LTI)~~At-Risk Compensation			~~Restricted Stock~~
	●• Accounts for 25% of total LTI award opportunity ●• Shares vest ratably over four years ● ~~Stock-settled~~• Performance hurdle as measured over the first year of the grant must be achieved for shares to be earned		●• Align ~~interest~~interests of Executive Officers and ~~shareholders~~stockholders ●• Support retention ~~through four-year vesting~~ ●• Support meaningful stock ownership
	~~Performance Shares~~
					Performance Shares

Long Term Incentives (LTI)		Variable At-Risk Performance-Based Compensation		Stock- Settled	●• Accounts for 75% of total LTI award opportunity ●• Provides opportunity to earn shares based on achievement of multiple specific performance goals ● ~~Multiple performance measures~~ ● ~~Stock-settled~~ ●• Relative TSR measure is for a ~~three-year performance~~three- year period ●• Financial measures are based on three years of performance (payouts, if any, are based on the aggregation of threeone-year performance goals compared to three years of results)	●• Drive long-term value creation for ~~shareholders~~stockholders ●• Motivate and reward Executive Officers for achievement of strategic business objectives over a ~~longer~~three-year period ~~of time~~ ●• Align the interests of Executive Officers with the long-term interests of the Company and ~~shareholders~~stockholders

Of our 910 Director Nominees:

60% are
independent

50% are current or
former CEOs

50% are women or
ethnically diverse

Director ages range
from 48 to 84
Median age: 63

~~56% are independent~~

~~67% are current or~~
~~former CEOs~~

~~44% are women or~~
~~ethnically diverse~~

~~Director ages range~~
~~from 47 to 83~~
~~Median age: 62~~