HAMPSHIRE GROUP, LIMITED AND AFFILIATES
COMMON STOCK PURCHASE PLAN
FOR DIRECTORS AND EXECUTIVES
AMENDED AND RESTATED
EFFECTIVE JUNE 7, 1995
SECTION 1. Purpose. The purpose of the Hampshire Group, Limited and Affiliates
Common Stock Purchase Plan for Directors and Executives, as amended and restated
effective June 7, 1995 (the "Plan"), is to provide to key executives and
non-employee directors of Hampshire Group, Limited (the "Company") and its
affiliated companies the opportunity to elect to defer payment of a portion of
their salaries and annual bonuses (in the case of key executives) on all or a
portion of their retainer fees (in the case of non-employee directors) arid
receive them in the form of Common Stock of the Company. The Plan, prior to its
amendment effective June 7, 1995, became effective as of June 24, 1992 (the
"Effective Date")
SECTION 2. Definitions. As used in the Plan, the following terms shall have the
meanings set forth below:
(a) "Administrator" means the committee appointed by the Board of Directors
to administer the Plan in accordance with Section 4 (a).
(b) "Affiliates" means Hampshire Designers, Inc.; Hampshire Hosiery, Inc.;
Vision Hosiery Mills, Inc.; and such other entities affiliated with the Company
which are designated by the Board of Directors as Affiliates.
(c) "Annual Retainer" means the amount paid by the Company to a
Non-Employee Director as an annual retainer for services to be rendered as a
member of the Board of Directors during any Plan Year, including retainers,
meeting attendance fees and fees otherwise payable for acting on or as a member
of the Board of Directors or any committee thereof, but not including
reimbursements of expenses.
(d) "Base Salary" means the annual base salary payable to a Key Executive
with respect to a Plan Year.
(e) "Beneficiary" means a person (including any trustee) designated by a
Participant in accordance with Section 10 to receive the benefits specified
hereunder in the event of the Participant's death or, if there is no surviving
designated Beneficiary, the Participant's estate.
(f) "Board of Directors" means the Board of Directors of the Company.
(g) "Bonus" means the annual bonus payable to a Key Executive with respect
to a Plan Year.
(h) "Deferral Account" means the account established and maintained by the
Company for each Participant, which is to be credited, as set forth in Section
6, with the portion of a Participant's Annual Retainer or Bonus which is
deferred pursuant to the Plan, together with earnings thereon as provided for
herein. In accordance with Section 6, amounts credited to a Participant's
Deferral Account will be expressed as a number of Stock equivalents and cash, if
any. Deferral Accounts will be maintained solely as bookkeeping entries by the
Company; provided, however, that the Company shall establish the Trust in
accordance with Section 8 to fund the obligations of the Company hereunder.
(i) "Director Purchase Date" means, with respect to the first Plan Year,
December 31, 1992, and with respect to each subsequent Plan Year the last day of
each of March, June, September and December of the Plan Year to which a
Non-Employee Director's deferral election relates, which in each case is the
date (with respect to the first Plan Year) or the dates (with respect to each
subsequent Plan Year) on which the deferred portion of an Annual Retainer
otherwise would have been paid.
(j) "Director Purchase Price" means 95% of the Fair Market Value of one
share of Stock on the Director Purchase Date.
(k) "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
(1) "Executive Purchase Price" means (i) with respect to deferrals of a Key
Executive's annual Bonus, 90% of the lower of (A) the average of the Fair Market
Value of one share of Stock on the last day of each calendar quarter during the
Plan Year to which such Bonus deferral relates or (B) the Fair Market Value of
one share of Stock on the last day of the Plan Year to which such Bonus deferral
relates; and (ii) with respect to deferrals of a Key Executive's Base Salary,
90% of the Fair Market Value of one share of Stock on the last day of each of
March, June, September and December of the Plan Year to which such Base Salary
deferral relates.
(m) "Fair Market Value" means, if the Stock is quoted on the National
Association of Securities Dealers Automated Quotation System ("NASDAQ"), the
mean between the last quoted bid and asked prices on NASDAQ on the date
immediately preceding the date of determination, or if not quoted on that day,
then on the last preceding date on which the Stock is quoted. If the Stock is
listed on one or more national securities exchanges, the Fair Market Value shall
be deemed to be the mean between the highest and lowest sale prices reported on
the principal national securities exchange on which the Stock is listed and
traded on the date immediately preceding the date of determination, or, if.
there is no such sale on that date, then on the last preceding date on which
such a sale was reported. If the Stock is not quoted on NASDAQ or listed on an
exchange, or representative quotes are not otherwise available, the Fair Market
Value shall mean the amount determined by the Committee to be the fair market
value of the Stock based upon a good faith attempt to value the Stock
accurately.
(n) "Key Executive" means an executive of the Company or an Affiliate
chosen by the Administrator pursuant to Section 3 to be offered the opportunity
to participate in the Plan.
(o) "Non-Employee Director" means a member of the Board of Directors who,
on the first day of any Plan Year (or such later date as he is first elected or
appointed to the Board of Directors) is not an employee of the Company or any
affiliate thereof.
(p) "Participant" means any Non-Employee Director or Key Executive who
elects under the Plan to defer payment of all or a portion of his Annual
Retainer or Bonus for any Plan Year.
(q) "Plan Year" means each year beginning on the first day of January and
ending on the 31st day of December, provided that the first Plan Year shall
commence on the Effective Date and end on December 31, 1992.
(r) "Stock" means Hampshire Group, Limited Common Stock, $0.10 par value
per share.
(s) "Trust" means the Hampshire Group, Ltd. and Affiliates Common Stock
Purchase Plan for Directors and Executives Trust.
(t) "Trust Agreement" means the agreement between the Company and the
Trustee establishing the Trust.
(u) "Trustee" means the trustee of the Trust.
SECTION 3. Participation.
(a) Only Non-Employee Directors and Key Executives may participate in the
Plan. Participation in the Plan is voluntary.
(b) To participate in the Plan for any Plan Year, each Non-Employee
Director must file a written application with the Administrator prior to the
first day of such Plan Year; provided, however, that (i) with respect to the
deferral of a portion of an Annual Retainer which otherwise would be payable on
or after September 1, 1993, such application must be filed with the
Administrator no less than six months prior to the date on which, such portion
of the Annual Retainer otherwise would have been paid, (ii) with respect to the
initial Plan Year, a Non-Employee Director will have 30 days following the date
the Plan is adopted to file such application, but then only with respect to that
portion of his Annual Retainer for such Plan Year not earned at the time such
election is filed, and (iii) the application of a Non-Employee Director who was
not a member of the Board of Directors as of the date on which applications are
required to be filed with respect to a given Plan Year must be filed within 30
days of the date the individual becomes a Non-Employee Director, but then only
with respect to that portion of his Annual Retainer for such Plan Year which is
payable at least six months after such election is filed.
(c) Each Key Executive electing to defer a portion of his annual Bonus for
a particular Plan Year must file a written application with the Administrator
prior to the first day of such Plan Year. With respect to a person who is not a
Key Executive as of the date on which applications are required to be filed with
respect to a given Plan Year, such person may file an application to defer a
portion of his annual Bonus within 30 days of becoming a Key Executive, provided
that (i) if such person is not subject to Section 16 of the Exchange Act, such
application must be filed no later than November 30 of the Plan Year to which
such application relates, and (ii) if such person is subject to Section 16 of
the Exchange Act, such application must be filed no later than June 30 of the
Plan Year to which such election relates.
(d) Each Key Executive electing to defer a portion of his annual Base
Salary for a particular Plan Year must file a written application with the
Administrator prior to the first day of such Plan Year, except that a Key
Executive who is subject to Section 16 of the Exchange Act must file the
application prior to June 30 of the calendar year preceding the Plan Year to
which such election relates. With respect to the short Plan Year for 1995, Key
Executives who are not subject to Section 16 of the Exchange Act may defer a
portion of their annual salary for the remainder of 1995 by filing an
application within 30 days after approval of the Plan by the Company's
shareholders. Key Executives who are subject to Section 16 of the Exchange Act
may not begin to defer annual Base Salary until January 1, 1996, and. must file
elections relating to the 1996 Plan Year before June 30, 1995. With respect to a
person who is not a Key Executive as of the date on which applications are
required to be filed with respect to a given Plan Year, such person may file an
application to defer annual Base Salary within 30 days of becoming a Key
Executive, provided that if such person is subject to Section 16 of the Exchange
Act, Base Salary deferrals for such person shall not commence until the date
which is at least six months following the date that such application is filed.
(e) An application for participation in the Plan shall evidence the
Non-Employee Director's or Key Executive's acceptance of the benefits and terms
of the Plan, and set forth the irrevocable elections described in Section 5. Any
application and all elections set forth therein shall be applicable only to the
Plan Year referenced therein.
SECTION 4. Administration.
(a) THE ADMINISTRATOR. The Board of Directors shall from time to time
appoint a committee comprised of two directors and two executive offices of the
Company to serve as the Administrator of the Plan. The Administrator shall
administer and enforce the Plan in accordance with its terms, and shall have all
powers necessary to accomplish those purposes, including but not limited to the
following:
(1) To compute and certify the amount and kind of benefits payable to
Participants and their Beneficiaries;
(2) To maintain or to designate any person or entity to maintain all
records necessary for the administration of the Plan;
(3) To make and publish such rules for the regulation of the Plan as
are not inconsistent with the terms hereof; and
(4) To provide for disclosure of such information, including reports
and statements to Participants or Beneficiaries, and for the making of
applications and elections by Participants under the Plan as may be
required by the Plan or otherwise deemed appropriate by the Administrator.
Notwithstanding the above, no person who serves on such committee shall
participate in any matter which involves solely a determination of the benefits
payable to him under the Plan. Any action of the Administrator with respect to
the Plan shall be conclusive and binding upon all persons interested in the Plan
except to the extent otherwise specifically indicated herein. The Administrator
may appoint agents and delegate thereto such powers and duties in connection
with the administration of the Plan as the Administrator may from time to time
prescribe.
To the maximum extent permitted by applicable law, the Administrator shall not
be liable for, and the Company shall indemnify the Administrator and agree to
hold the Administrator harmless from, all liabilities and claims (including
reasonable attorney's fees and expenses in defending against such liabilities
and claims) against the Administrator arising from any actions taken by the
Administrator in connection with the administration of the Plan unless such
liabilities or claims are the result of the gross negligence or willful
misconduct of the Administrator.
(b) ANNUAL STATEMENTS. As soon as practicable following the end of each
Plan Year, the Administrator shall furnish to each Participant a statement
indicating the number of Stock equivalents credited to his Deferral Account as
of the end of such Plan Year and the status of such Account.
SECTION 5. Elections by Participants.
Each Non-Employee Director and Key Executive who elects to participate in the
Plan for any Plan Year must irrevocably elect, in (a) accordance with the
procedures, and within the time limits set forth in Section 3, the following: A
percentage, (i) in the case of a Non-Employee Director, up to 100%, of his
Annual Retainer for the Plan Year, and (ii) in the case of a Key Executive, from
10%-40% of his Bonus for the Plan Year, and from 4% to 10% of his Base Salary
for the Plan Year, to be deferred under the Plan and paid in the form of Stock;
and
(b) The date on which such portion of the Participant's Annual Retainer,
Bonus or Base Salary shall be paid or commence to be paid and the method in
which such payment shall be made. Such date and method shall be among those
described in Section 9.
In the event the Annual Retainer of a Non-Employee Director, or the Base Salary
of a Key Executive, is increased during any Plan Year, his elections in effect
for such Plan Year shall apply to the amount of such increase.
SECTION 6. Deferral Accounts.
(a) CREDITING OF ANNUAL RETAINER OR BONUS DEFERRAL. The portion of each
Participant's Annual Retainer, Bonus or Base Salary which he elects to defer
with respect to a Plan Year in accordance with Section 5 shall be credited to
the Participant's Deferral Account as follows:
(i) The Deferral Account of each Non-Employee Director Participant
shall be credited on each Director purchase Date with the number of Stock
equivalents equal to the portion of the Annual Retainer deferred pursuant
to the Plan since the preceding Director purchase Date divided by the
Director Purchase Price.
(ii) With respect to Bonus deferrals, the Deferral Account of each Key
Executive Participant shall be credited with the deferred portion of such
Participant's Bonus at the time such amount otherwise would have been paid.
Immediately following the crediting to such Deferral Accounts of all
amounts of Bonus deferred with respect to a Plan Year (but no earlier than
December 31 of the Plan Year), the amount so credited (without earnings)
shall be converted into the number of Stock equivalents equal to such
amount divided by the Executive Purchase Price.
(iii) With respect to Base Salary deferrals, the Deferral Account of
each Key Executive Participant shall be credited, on a quarterly basis,
with the quarterly portion of such Participant's annual Base Salary
deferred with respect to a Plan Year on the last day of each of March,
June, September and December of the Plan Year to which the deferral
election relates. The amounts so credited (without earnings) shall, on each
such date, be converted into the number of Stock equivalents equal to such
deferred amount divided by the applicable Executive Purchase Price for such
date.
(b) CREDITING OF DIVIDENDS. Dividends payable with respect to Stock
equivalents credited to each Participant's Deferral Account shall be credited to
such Deferral Account as of the date dividends are actually paid on Stock. As of
the March 15 following the Plan Year to which such dividends relate (in the case
of a Key Executive Participant), or as of the Director Purchase Date following
the crediting of dividends to a Deferral Account (in the case of a Non-Employee
Director Participant), such dividends (including earnings thereon equal to the
actual earnings on dividends paid on the Participant's share of Stock held in
the Trust) shall be converted into the number of Stock equivalents (rounded to
the nearest whole share) determined by applying the formulas described in clause
(i) or (ii) of Section 6(a) above as applicable.
(c) ADJUSTMENTS TO DEFERRAL ACCOUNTS. The amount of Stock equivalents in
each Participant's Deferral Account shall be appropriately adjusted upon the
occurrence of any stock split, reverse stock split, or stock dividend or other
non-cash distribution.
(d) EFFECT OF PAYMENTS. The amount of Stock equivalents and cash, if any,
credited to each Participant's Deferral Account shall be reduced by the number
of shares of Stock and amount of cash distributed to each Participant or his
Beneficiary from the Trust or directly from the Company as payment of benefits
due under the Plan.
(e) VESTING. The interest of each Participant in any benefit payable with
respect to a Deferral Account hereunder shall be at all times fully vested and
non-forfeitable.
SECTION 8. The Trust.
(a) CREATION OF THE TRUST. The Board of Directors shall cause the Trust to
be created, shall appoint the Trustee and shall authorize the appropriate
officers of the Company to execute all necessary trust agreements and other
instruments necessary therefor; provided, however, that (i) the terms of the
Trust shall be consistent with the status of the Plan as "unfunded" for purposes
of ERISA and (ii) the Trust shall conform to the terms of the model grantor
trust contained in Revenue Procedure 92-64, 1992-33 I.R.B. 11.
(b) CONTRIBUTIONS TO AND PURCHASE OF STOCK BY THE TRUST.
(i) Not later than 10 days following each day on which amounts are
credited to Deferral Accounts and converted into Stock equivalents in
accordance with Section 6 (a), the Company shall contribute to the Trust
either (A) that number of shares of Stock, or (B) cash in an amount
sufficient to allow the Trustee to purchase from the Company or on the open
market that number of shares of Stock, equal to the aggregate number of
Stock equivalents so credited. Notwithstanding the above, the Company shall
not be required to contribute cash to the Trust pursuant to clause (B)
above in an amount greater than that which can be used by the Trustee on
the date of such contribution to purchase Stock within any purchase volume
limitations imposed on the Trust by applicable law or the rules of any
exchange on which Stock is traded. In the event the Company's total
required contribution to the Trust cannot be made by the above deadline
pursuant to the preceding sentence, the Company shall make periodic
contributions to the Trust after such deadline until the Trust has
purchased the requisite number of shares of Stock.
(ii) Not later than 10 days following each day on which amounts are
credited to Deferral Accounts and converted into Stock Equivalents in
accordance with Section 6 (b), the Administrator shall instruct the Trustee
to purchase from the Company, or on the open market, that number of shares
of Stock equal to the aggregate number of Stock equivalents, if any, so
credited. Any such purchase from the Company shall be made from Stock held
in the treasury, or authorized but unissued shares of registered or
unregistered Stock, using cash dividends paid on Stock held in the Trust.
The purchase price for each such share of Stock purchased from the Company
shall be determined by the formula described in clause (i) or (ii) of
Section 6 (a). Notwithstanding the above, (i) if such purchase is made on
the open market, and if the cash dividends held in the Trust and earnings
thereon are insufficient to purchase the necessary number of shares of
Stock, the Company shall contribute to the Trust additional cash in the
amount required to allow the Trustee to purchase such shares, and (ii) the
Administrator shall not instruct the Trustee to purchase Stock on the open
market, and the Company shall not make any additional contribution to the
Trust pursuant to clause (i) of this sentence, to the extent that the
Trustee would be prevented from purchasing the requisite shares of Stock
due to any purchase volume limitations imposed on the Trust by applicable
law or the rules of any exchange on which Stock is traded. In the event
such instructions or contribution to the Trust cannot be made by the above
deadline pursuant to clause (ii) above, such instructions and contributions
shall be periodically made after such deadline until the Trust has
purchased the requisite number of shares of Stock.
(iii) The Company shall impose such legends, stop transfer and other
restrictions on certificates evidencing Stock sold to the Trust by the
Company hereunder as it may deem advisable in order to comply with the
Securities Act of 1933, as amended, the requirements of the New York Stock
Exchange or any other stock exchange or automated quotation system upon
which the Stock is then listed or quoted, any state securities laws
applicable to such a sale, or any provision of the Company's Certificate of
Incorporation or By-Laws or any binding contract to which the Company is a
party.
(c) INVESTMENT OF DIVIDENDS PENDING PURCHASE OF STOCK. Cash dividends paid
on Stock held in the Trust shall be invested in short-term instruments issued by
the government of the United States or government-guaranteed, interest-bearing
accounts of a financial institution pending the use of such dividends to
purchase Stock in accordance with Section 3 (b) (ii).
(d) DISTRIBUTIONS FROM THE TRUST. At each time payment of all or a portion
of each Participant's Deferral Account is due pursuant to an election made in
accordance with Section 5 (or pursuant to the death of a Participant in
accordance with Section 9(c)), the Administrator shall instruct the Trustee to
distribute Stock and cash from the Trust directly to such Participant or his
Beneficiary in an amount equal to the portion of his Deferral Account which is
so payable. Distributable amounts expressed in the form of Stock equivalents
shall be paid in Stock, and distributable amounts expressed in the form of cash
shall be paid in cash. In the absence of such an instruction to the Trustee by
the Administrator, a Participant may directly instruct the Trustee to make such
distribution, and the Trustee shall do so if it determines that such
distribution is in accordance with the Participant's Section 5 election. If the
Trustee fails to make any distribution from the Trust required hereunder, the
Company shall make such distribution directly to the Participant entitled
thereto from its general assets, treasury Stock and authorized but unissued
Stock; provided, however, that in the event no treasury Stock or authorized but
unissued Stock is available, distributable amounts from a Participant's Deferral
Account expressed in the form of Stock equivalents shall be paid by the Company
in the form of cash, in an amount equal to the Fair Market Value of Stock
represented by such Stock equivalents as of the day preceding the day of
payment. If any payment is made to a Participant by the Company pursuant to the
preceding sentence, the Participant shall be deemed to have assigned to the
Company his rights to receive such payment from the Trust, and the Company shall
be subrogated to all rights of the Participant therein.
SECTION 9. Distributions.
(a) DATE OF COMMENCEMENT. A Participant may elect in accordance with
Section 5 that payment of the portion of his Deferral Account attributable to
the particular Annual Retainer or Bonus being deferred commence on either (i)
any specific anniversary of the last day of the Plan Year to which such deferral
relates or (ii) immediately upon termination as a Non-Employee Director or Key
Executive.
(b) NUMBER OF PAYMENTS. A Participant may elect in accordance with Section
5 to receive payment of the portion of his Deferral Account subject to such
election in one lump sum or in substantially equal annual installments over two
to ten years.
(c) DISTRIBUTION UPON DEATH. If a Participant dies before payment of his
Deferral Account is completed, the balance remaining in such Deferral Account
shall be paid to the Participant's Beneficiary in one lump sum as soon as
practicable following the Participant's death.
(d) DISTRIBUTION UPON UNFORESEEABLE EMERGENCY. Notwithstanding anything in
this Section 9 to the contrary, a Participant may request a distribution of all
or part of his Deferral Account due to "unforeseeable emergency" For purposes of
this subsection, "unforeseeable emergency" means severe financial hardship to
the Participant resulting from a sudden and unexpected illness or accident of
the Participant or a dependent, loss of the Participant's property due to
casualty, or other similar extraordinary and unforeseeable circumstances arising
as a result of events beyond the control of the Participant. The circumstances
that will constitute an unforeseeable emergency will depend upon the facts of
each case and will be determined by the Committee in its sole discretion, but
distributions may not be made to the extent that such hardship is or may be
relieved (i) through reimbursement or compensation by insurance or otherwise or
(ii) by liquidation of the Participant's assets, to the extent the liquidation
of such assets would not itself cause severe financial hardship. In no event may
the amount of any distribution due to unforeseeable emergency be greater than
that reasonably needed to satisfy the emergency need.
SECTION 10. Designation of Beneficiaries.
Each Participant may designate one or more Beneficiaries to receive the amounts
distributable from the Participant's Deferral Account under the Plan in the
event of such Participant's death. Such designations shall be made on forms
provided by the Administrator. A Participant may from time to time change his
designated Beneficiaries, without the consent of such Beneficiaries, by filing a
new designation in writing with the Administrator. The Company, Trustee and
Administrator may rely conclusively upon the Beneficiary designation last filed
in accordance with the terms of the Plan.
SECTION 11. Amendments to the Plan; Termination of the Plan.
The Board of Directors of the Company may amend, alter, suspend, discontinue or
terminate the Plan without the consent of any Participant; provided, however,
that no such amendment, alteration, suspension, discontinuation, or termination
of the Plan shall materially and adversely affect the rights of such Participant
with respect to payment of amounts already credited to such Participant's
Deferral Account, or amounts elected to be so credited for the Plan Year in
which such action is taken. The Plan has no fixed termination date. In addition,
the Administrator may take such other action as it deems necessary to ensure
that Participants are not deemed to have engaged in a "purchase" or "sale" of
Stock pursuant to their participation in the Plan, as such terms are used in
Section 16(b) of the Securities Exchange Act of 1934, and the Rules promulgated
thereunder.
SECTION 12. General Provisions.
(a) LIMITS ON TRANSFER OF RIGHTS; BENEFICIARIES. No right or interest of a
Participant under the Plan shall be pledged, encumbered or hypothecated, shall
be liable for or subject to any lien, obligation or liability of such
Participant, or shall be assignable or transferable by a Participant otherwise
than by will or the laws of descent and distribution; provided, however, that a
Participant may designate a Beneficiary in accordance with Section 10 to receive
any payment or distribution under the Plan in the event of death of the
Participant. A Beneficiary, guardian, legal representative or other person
claiming any rights under the Plan from or through any Participant shall be
subject to all terms and conditions of the Plan applicable to such Participant,
except to the extent the Plan otherwise provides with respect to such persons.
(b) RECEIPT AND RELEASE. Any payment to any Participant or Beneficiary in
accordance with the provisions of the Plan, whether made from the Trust or
directly from the Company, shall, to the extent thereof, be in full satisfaction
of all claims against the Company, the Administrator, the Trust and the Trustee,
and the Administrator may require such Participant or Beneficiary, as a
condition to such payment, to execute a receipt and release to such effect.
(c) STATUS OF THE PLAN. The Plan is not intended to be subject to ERISA. To
the extent the Plan is determined to be so subject, it is intended to constitute
a "plan which is unfunded and is maintained by the employer primarily for the
purpose of providing deferred compensation for a select group of management or
highly compensated employees," as such phrase is used in ERISA, and the terms of
the Plan shall be interpreted consistent with such intent. With respect to any
payment not yet made to a Participant under the Plan, nothing contained in the
Plan shall give a Participant any rights that are greater than those of a
general creditor of the Company; provided, however, that the assets of the Trust
shall be used solely to provide benefits under the Plan in the absence of the
insolvency of the Company.
(d) NO RIGHTS OF A STOCKHOLDER. Except as provided in the Trust Agreement
with respect to Stock held in the Trust, no Participant shall have any of the
rights or privileges of a shareholder of the Company as a result of the making
of an election under Section 5(b) of the Plan, or as a result of the
establishing of or crediting of any amounts to a Deferral Account under the
Plan, until Stock is actually distributed to the Participant pursuant to Section
8(d) of the Plan.
(e) NO RIGHT TO CONTINUED ELECTION AS A DIRECTOR OR EMPLOYMENT. Nothing
contained in the Plan shall confer, and no establishment of or crediting of any
amounts to a Deferral Account shall be construed as conferring, upon any
Participant, any right to continue as a member of the Board of Directors or an
employee of the Company or any of its Affiliates, or to interfere in any way
with the right of the Company to increase or decrease the amount of the Annual
Retainer, Bonus or any other compensation payable to Non-Employee Directors or
Key Executives.
(f) PLAN EXPENSES. All expenses and costs incurred in connection with the
operation of the Plan and the Trust shall be borne by the Company; provided,
however, that any legal fees and expenses incurred by both the Participant and
the Company in an action by the Participant to enforce against the Company any
right or benefit provided under the Plan shall be paid by the party who prevails
in such action.
(g) GOVERNING LAW. The validity, construction and effect of the Plan and
any rules and regulations relating to the Plan shall be determined in accordance
with the laws of the State of Delaware, without giving effect to principles of
conflicts of laws, and applicable Federal law.
(h) INTERPRETATION. Whenever necessary or appropriate in the Plan, where
the context admits, the singular term and the related pronouns shall include the
plural and the masculine gender shall include the feminine gender.