NATIONAL PENN BANCSHARES, INC.
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DIRECTORS' FEE PLAN
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SECTION I - DEFINITIONS
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A. Board of Directors: The Board of Directors of the Company.
B. Common Stock: The Company's common stock, without par value.
C. Company: National Penn Bancshares, Inc.
D. Compensation Committee: The Compensation Committee of the Board of
Directors (comprised solely of persons who are "non-employee directors" of the
Company, as such term is defined by the Securities and Exchange Commission
pursuant to Section 16 of the Securities Exchange Act of 1934).
E. Corporate Secretary: The Corporate Secretary of the Company.
F. Current Stock Election: An election to receive current payment of
Director Fees in shares of Common Stock, without deferral.
G. Deferred Cash Compensation Account: A book-entry reserve account
maintained in the records of the Company (in the case of its participating
Directors) or of a Subsidiary (in the case of its participating Directors)
indicating the amount owed to an individual Director as a result of a cash
deferral of his Director Fees.
H. Deferred Cash Election: An election to defer the receipt of all or a
portion of Director Fees and to receive eventual payment of such Director Fees
in cash.
I. Deferred Stock Compensation Account: A book-entry reserve account
maintained in the records of the Company (in the case of its participating
Directors) or of a Subsidiary (in the case of its participating Directors)
indicating the amount owed to an individual Director as a result of a stock
deferral of his Director Fees.
J. Deferred Stock Election: An election to defer the receipt of all
Director Fees and to receive eventual payment of such Director Fees in shares of
Common Stock.
K. Director: Any duly elected or appointed director of the Company or
of a Subsidiary, or any duly appointed member of an
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advisory board of a Subsidiary, other than a person who is also a common law
employee of the Company or of a Subsidiary. For purposes of administering and
construing this Plan, such a common law employee shall be deemed to be a person
who is not a Director.
L. Director Fees: Fees which are payable to a Director for services
performed by such Director as a member of the Board of Directors, as a member of
a Subsidiary's board of directors, as a member of any committee, or as a member
of any advisory board of a Subsidiary.
M. Election: The election by a Director to receive payment of Director
Fees other than currently in cash.
N. Fair Market Value: The fair market value of a share of Common Stock,
determined pursuant to Section XII hereof.
O. Interest Crediting Date: March 31, June 30, September 30 and
December 31 of each Plan Year.
P. Plan: This Directors' Fee Plan, as adopted by the Company and as it
may be amended from time to time.
Q. Plan Quarter: A calendar quarter.
R. Plan Year: A calendar year.
S. Subsidiary: Any corporation, 50% or more of the capital stock of
which is owned, directly or indirectly, by the Company.
SECTION II - PURPOSE; RESERVATION OF SHARES
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The purposes of the Plan are to provide each Director with payment
alternatives for Director Fees and to increase the identification of interests
between Directors and the shareholders of the Company by providing Directors
with the opportunity to elect to receive payment of Director Fees in shares of
Common Stock. For each Plan Year, the aggregate number of shares of Common Stock
which may be issued under Current Stock Elections or credited to Deferred Stock
Compensation Accounts for subsequent issuance under the Plan is limited to
25,000 shares, subject to adjustment and substitution as set forth in Section
VII.B.
SECTION III - ELIGIBILITY TO PARTICIPATE
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Except as otherwise provided in Section VI or Section VIII, any
Director is eligible to participate in the Plan.
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SECTION IV - PAYMENT OR DEFERRAL OF DIRECTORS' FEES
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A. General. Each Director may elect to receive current payment of
Director Fees either in cash or in shares of Common Stock, without deferral.
Each Director also may elect to defer payment of Director Fees and to receive
such deferred payment either in cash or in shares of Common Stock. An Election
is made by filing with the Corporate Secretary a "Notice of Election" in the
form prescribed by the Company, appropriately completed. Director Fees earned at
any time for which an Election is not effective shall be paid in cash on the
date when the Director Fees are otherwise payable. Subject to the terms of the
Plan, an Election may be changed, modified or terminated by filing with the
Corporate Secretary a "Notice of Amendment or Revocation of Election" in the
form prescribed by the Company, appropriately completed. Any Election shall
terminate on the date a Director ceases to be a Director. Any "Notice of
Election" or "Notice of Amendment or Revocation of Election" shall become
irrevocable when filed, except by the filing of a new "Notice of Election" or
"Notice of Amendment or Revocation of Election" which thereafter becomes
effective in accordance with the provisions of this Section IV.
B. Current Stock Payment. Any Director desiring to make a Current Stock
Election shall file with the Corporate Secretary a "Notice of Election",
appropriately completed. A Current Stock Election shall be effective on the date
on which the "Notice of Election" is filed. Any Current Stock Election shall
remain in effect for each succeeding Plan Year unless and until the Director
revokes such Election by filing a "Notice of Amendment or Revocation of
Election" with the Corporate Secretary, appropriately completed. Any such
revocation shall become effective for the Plan Year immediately following the
Plan Year in which such revocation is duly filed.
During the period that a Current Stock Election is effective, all
Director Fees payable shall be paid by the issuance to the Director of a number
of whole shares of Common Stock equal to the Director Fees payable divided by
the Fair Market Value of a share of Common Stock on the date on which such
Director Fees are payable (as provided in Section XII hereof). Any amount of
Director Fees which is not paid in Common Stock because it is less than the Fair
Market Value of a whole share shall be accumulated in cash without interest and
added to the amount used in computing the number of shares of Common Stock
issuable to the Director on the next succeeding date on which Director Fees are
payable under the Current Stock Election. Any such accumulated fractional amount
remaining as of the effective date of any termination of a Current Stock
Election or of the termination of the Plan shall be paid to the Director in cash
on the next succeeding date on which Director Fees would have been payable to
the Director under the Current Stock Election.
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The Company shall issue share certificates to the Director for the
shares of Common Stock acquired or, if requested in writing by the Director, the
shares acquired shall be added to the Director's account under the Company's
Dividend Reinvestment Plan. As of the date on which the Director Fees are
payable in shares of Common Stock, the Director shall be a shareholder of the
Company with respect to such shares.
C. Deferred Cash Payment. Any Director desiring to make a Deferred Cash
Election shall, no later than December 31 of the Plan Year immediately preceding
the Plan Year for which such Deferred Cash Election is to become effective, file
with the Corporate Secretary a "Notice of Election", appropriately completed. In
the case of a person who is elected or appointed as a Director and who was not a
Director on the preceding December 31st, such Deferred Cash Election shall be
made prior to the commencement of his term of office. For 1997, a Deferred Cash
Election shall be made prior to January 1, 1997. Any Deferred Cash Election
shall remain in effect for each succeeding Plan Year unless and until the
Director amends or revokes such Election by filing with the Corporate Secretary
a "Notice of Amendment or Revocation of Election", appropriately completed. Any
such amendment or revocation shall become effective for the Plan Year
immediately following the Plan Year in which such amendment or revocation is
duly filed, and shall remain effective until similarly changed.
D. Deferred Stock Payment. Any Director desiring to make a Deferred
Stock Election shall, no later than December 31 of the Plan Year immediately
preceding the Plan Year for which such Deferred Stock Election is to become
effective, file with the Corporate Secretary a "Notice of Election",
appropriately completed. In the case of a person who is elected or appointed as
a Director and who was not a Director on the preceding December 31st, such
Deferred Stock Election shall be made prior to the commencement of his term of
office. For 1997, a Deferred Stock Election shall be made prior to January 1,
1997. Any Deferred Stock Election shall remain in effect for each succeeding
Plan Year unless and until the Director revokes such Election by filing with the
Corporate Secretary a "Notice of Amendment or Revocation of Election",
appropriately completed. Any such revocation shall become effective for the Plan
Year immediately following the Plan Year in which such revocation is duly filed.
SECTION V - DEFERRED CASH COMPENSATION ACCOUNT
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A. General. The amount of any Director Fees deferred in accordance with
a Cash Deferral Election shall be credited to a Deferred Cash Compensation
Account in the name of the Director on the date on which such Director Fees are
otherwise payable.
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B. Interest. On each Interest Crediting Date, each Deferred Cash
Compensation Account shall be credited with additional amounts in the nature of
interest. The rate of interest that will accrue with respect to a Deferred Cash
Compensation Account for a given Plan Year will be equal to the rate of return
realized by the Mandatory Deferral Accounts ("Mandatory Deferral Accounts") of
the National Penn Bancshares, Inc. Executive Incentive Plan (the "Executive
Incentive Plan") during the three-month period ended within such Plan Quarter.
Interest on amounts in Deferred Cash Compensation Accounts shall accrue daily
and shall be determined by reference to a 365/366-day year; provided, however,
that no deferred Director Fee shall commence accruing interest until the first
day of the Plan Quarter immediately following the Plan Quarter in which it is
earned.
Notwithstanding the provisions of the preceding paragraph, if a
Deferred Cash Compensation Account is completely liquidated on a date other than
an Interest Crediting Date, interest shall be credited to such Account, as of
the date of its liquidation, for the period since the last Interest Crediting
Date. The interest rate to be used shall be the rate of return realized by the
Mandatory Deferral Accounts during the three-month period ended within the last
preceding Plan Quarter.
Notwithstanding anything herein to the contrary, the Compensation
Committee may vary the method of calculating interest on Deferred Cash
Compensation Account balances if the Executive Incentive Plan is terminated or
amended to materially alter the present nature of calculation of interest on
Mandatory Deferral Accounts. The decision of the Compensation Committee as to
the use of a substituted method of calculating interest shall be final and
binding on all affected Directors.
SECTION VI - DISTRIBUTION OF DEFERRED
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CASH COMPENSATION ACCOUNT BALANCES
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A. General. No distribution from a Deferred Cash Compensation Account
shall be made or commence prior to the occurrence of the event selected by the
Director in his Deferred Cash Election as occasioning such distribution. The
actual date on which distribution will be made or commence will be determined by
the Compensation Committee; provided, however, that such date may be no later
than December 31 of the Plan Year in which such event occurs.
Distributions from Deferred Cash Compensation Accounts may be made in a
lump sum or in annual installments over a period of five or ten years. The
amount of any annual installment shall be calculated by dividing the balance in
a Director's Deferred Cash Compensation Account at the relevant time by the
number of installments remaining to be paid. The actual method of
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distribution from a Director's Deferred Cash Compensation Account will be
determined by the method of distribution selected by the Director in his
Deferred Cash Election. The balance of the Deferred Cash Compensation Account
shall be appropriately reduced on the date of payment to the Director or the
Director's designated beneficiary to reflect the installment payments made
hereunder. Amounts held pending distribution pursuant to this Section VI shall
continue to be credited with interest on a quarterly basis as described in
Section V hereof.
Notwithstanding anything herein to the contrary, if an individual
becomes a proprietor, officer, partner, employee or otherwise becomes affiliated
with any business or governmental agency which is in competition with or has
regulatory authority over the Company or a Subsidiary, the Compensation
Committee shall be entitled, in its sole discretion, to terminate his
participation in the Plan and direct that distribution be made to him in one
lump sum at that time.
Once made, an election as to the event which shall occasion a
distribution and an election as to the method of distribution shall be
irrevocable, unless the Compensation Committee consents in writing to a change.
In no event shall such consent be granted with respect to a request by an
individual after the occurrence of the event selected by him as occasioning a
distribution.
B. Beneficiary Designation. A Director may designate one or more
persons to receive the balance in his Deferred Cash Compensation Account in the
event of his death prior to receipt of the total amount therein. No such
designation will be valid unless made on a "Beneficiary Designation" form
prescribed by the Company, and duly and timely filed with the Corporate
Secretary. A Director may at any time, and from time to time, revoke or amend
such designation by duly and timely filing a new "Beneficiary Designation" form
with the Corporate Secretary. If a Director dies without a completed
"Beneficiary Designation" form on file with the Corporate Secretary, payment
will be made to his estate. All distributions made as a result of death shall be
paid in lump sums.
SECTION VII - DEFERRED STOCK COMPENSATION ACCOUNT
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A. General. The amount of any Director Fees deferred in accordance with
a Stock Deferral Election shall be credited to a Deferred Stock Compensation
Account in the name of the Director. On each date on which Director Fees are
payable to Directors for whom Stock Deferral Elections are in effect, the
Director's Deferred Stock Compensation Account shall be credited with a number
of shares of Common Stock (including fractional shares) equal to the Director
Fees payable divided by the Fair Market Value of a share of Common Stock, on the
date on which such Director Fees are payable (as provided in Section XII
hereof). If a dividend or
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distribution is paid on the Common Stock in cash or property other than Common
Stock, then, on the date of payment of the dividend or distribution to holders
of the Common Stock, each Deferred Stock Compensation Account shall be credited
with the number of shares of Common Stock (including fractional shares) equal to
the number of shares of Common Stock credited to such Account on the date fixed
for determining the shareholders entitled to receive such dividend or
distribution times the amount of the dividend or distribution paid per share of
Common Stock divided by the Fair Market Value of a share of Common Stock on the
date on which the dividend or distribution is paid. If the dividend or
distribution is paid in property, the amount of the dividend or distribution
shall equal the fair market value of the property on the date on which the
dividend or distribution is paid. The Deferred Stock Compensation Account of a
Director shall be charged on the date of distribution with any distribution of
shares of Common Stock made to the Director from such Account pursuant to
Section VIII.A. hereof.
B. Adjustment and Substitution. The number of shares of Common Stock
credited to each Deferred Stock Compensation Account, and the number of shares
of Common Stock available for issuance or crediting under the Plan in each Plan
Year in accordance with Section II hereof, shall be proportionately adjusted to
reflect any dividend or other distribution on the outstanding Common Stock
payable in shares of Common Stock or any split or consolidation of the
outstanding shares of Common Stock. If the outstanding Common Stock shall, in
whole or in part, be changed into or exchangeable for a different class or
classes of securities of the Company or securities of another company or cash or
property other than Common Stock, whether through reorganization,
reclassification, recapitalization, merger, consolidation or otherwise, the
Board of Directors shall adopt such amendments to the Plan as it deems necessary
to carry out the purposes of the Plan, including the continuing deferral of any
amount of any Deferred Stock Compensation Account.
SECTION VIII - DISTRIBUTION OF DEFERRED
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STOCK COMPENSATION ACCOUNT BALANCES
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A. General. No distribution from a Deferred Stock Compensation Account
shall be made or commence prior to the occurrence of the event selected by the
Director in his Deferred Stock Election as occasioning such distribution. The
actual date on which distribution will be made or commence will be determined by
the Compensation Committee; provided, however, that such date may be no later
than December 31 of the Plan Year in which such event occurs.
Distributions of Common Stock from Deferred Stock Compensation Accounts
may be made in a lump sum or in annual installments over a period of five or ten
years. The number of shares of Common
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Stock distributed in any annual installment shall be calculated by dividing the
balance in a Director's Deferred Stock Compensation Account at the relevant time
by the number of installments remaining to be paid. The actual method of
distribution from a Director's Deferred Stock Compensation Account will be
determined by the method of distribution selected by the Director in his
Deferred Stock Election.
The balance of the number of shares of Common Stock in the Deferred
Stock Compensation Account shall be appropriately reduced to reflect the
installment payments made hereunder. Shares of Common Stock remaining in a
Deferred Stock Compensation Account pending distribution pursuant to this
Section shall continue to be credited with respect to dividends or distributions
paid on the Common Stock pursuant to Section VII hereof and shall be subject to
adjustment or substitution pursuant to Section VII hereof. If a lump sum payment
or the final installment payment hereunder would result in the issuance of a
fractional share of Common Stock, such fractional share shall not be issued and
cash in lieu of such fractional share shall be paid to the Director based on the
Fair Market Value of a share of Common Stock on the date immediately preceding
the date of such payment.
The Company shall issue share certificates to the Director, or the
Director's designated beneficiary, for the shares of Common Stock distributed
hereunder, or if requested in writing by the Director, the shares to be
distributed shall be added to the Director's account under the Company's
Dividend Reinvestment Plan. As of the date on which the Director is entitled to
receive payment of shares of Common Stock, the Director shall be a shareholder
of the Company with respect to such shares.
Notwithstanding anything herein to the contrary, if an individual
becomes a proprietor, officer, partner, employee or otherwise becomes affiliated
with any business or governmental agency which is in competition with or has
regulatory authority over the Company or a Subsidiary, the Compensation
Committee shall be entitled, in its sole discretion, to terminate his
participation in the Plan and direct that distribution of the balance of his
Deferred Stock Compensation Account be made to him in one lump sum at that time.
Once made, an election as to the event which shall occasion a
distribution and an election as to the method of distribution shall be
irrevocable, unless the Compensation Committee consents in writing to a change.
In no event shall such consent be granted with respect to a request by an
individual after the occurrence of the event selected by him as occasioning a
distribution.
B. Beneficiary Designation. A Director may designate one or more
persons to receive the balance in his Deferred Stock Compensation Account in the
event of his death prior to receipt of
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the total amount therein. No such designation will be valid unless made on a
"Beneficiary Designation" form prescribed by the Company, and duly and timely
filed with the Corporate Secretary. A Director may at any time, and from time to
time, revoke or amend such designation by duly and timely filing a new
"Beneficiary Designation" form with the Corporate Secretary. If a Director dies
without a completed "Beneficiary Designation" form on file with the Corporate
Secretary, payment will be made to his estate. All distributions made as a
result of death shall be paid in lump sums.
SECTION IX - NON-ALIENABILITY OF BENEFITS
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Neither the Director nor any beneficiary designated by the Director
shall have the right, directly or indirectly, to alienate, assign, transfer,
pledge, anticipate or encumber (except by reason of death) any amount that is or
may be payable hereunder, nor shall any such amount be subject to anticipation,
alienation, sale, assignment, transfer, pledge, encumbrance, attachment or
garnishment by creditors of the Director or the Director's designated
beneficiary or to the debts, contracts, liabilities, engagements or torts of any
Director or the Director's designated beneficiary, or transfer by operation of
law in the event of bankruptcy or insolvency of the Director or the Director's
designated beneficiary, or any legal process.
SECTION X - NATURE OF DEFERRED ACCOUNTS
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Any Deferred Cash Compensation Account or Deferred Stock Compensation
Account shall be established and maintained only on the books and records of the
Company or the applicable Subsidiary, and no assets or funds of the Company, a
Subsidiary or the Plan or shares of Common Stock shall be removed from the
claims of the Company's or a Subsidiary's general or judgment creditors or
otherwise made available until such amounts are actually payable to Directors or
their designated beneficiaries as provided herein. The Plan constitutes a mere
promise by the Company or the applicable Subsidiary to make payments in the
future. The Directors and their designated beneficiaries shall have the status
of, and their rights to receive a payment of cash or shares of Common Stock
under the Plan shall be no greater than the rights of, general unsecured
creditors of the Company or the applicable Subsidiary. No person shall be
entitled to any voting rights with respect to shares credited to a Deferred
Stock Compensation Account and not yet payable to a Director or the Director's
designated beneficiary. The Company and the Subsidiaries shall not be obligated
under any circumstances to fund their respective financial obligations under the
Plan and the Plan is intended to constitute an unfunded plan for Federal income
tax purposes.
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SECTION XI - PLAN ADMINISTRATION; HARDSHIP WITHDRAWAL
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The Compensation Committee shall, with respect to the Plan, have full
power and authority to construe, interpret, manage, control and administer this
Plan, and to pass and decide upon cases in conformity with the objectives of the
Plan under such rules as the Board of Directors and/or the Compensation
Committee may establish.
If the Compensation Committee deems any person entitled to receive a
distribution incapable of receiving or disbursing the same by reason of age,
illness or any infirmity or incapacity of any kind, payment may be made directly
for the comfort, support and maintenance of such person or to any person
selected by the Compensation Committee to disburse the same, whose receipt shall
be a complete acquittance therefor.
Notwithstanding the terms of a Cash Deferral Election or a Stock
Deferral Election made by a Director hereunder, the Compensation Committee may,
in its sole discretion, permit the withdrawal of amounts credited to a Deferred
Cash Compensation Account or of shares credited to a Deferred Stock Compensation
Account with respect to Director Fees previously payable, upon the request of a
Director or the Director's representative, if the Compensation Committee
determines that the Director or the Director's representative, as the case may
be, is confronted with an unforeseeable emergency. For this purpose, an
unforeseeable emergency is an unanticipated emergency caused by an event that is
beyond the control of the Director or the Director's representative and that
would result in severe financial hardship to the Director if an early hardship
withdrawal were not permitted. The Director or the Director's representative
shall provide to the Compensation Committee such evidence as the Compensation
Committee, in its discretion, may require to demonstrate that such emergency
exists and financial hardship would occur if the withdrawal were not permitted.
The withdrawal shall be limited to the amount or to the number of shares, as the
case may be, necessary to meet the emergency. For purposes of the Plan, a
hardship shall be considered to constitute an immediate and unforseen financial
hardship if the Director has an unexpected need for cash to pay for expenses
incurred by him or a member of his immediate family (spouse and/or natural or
adopted children) such as those arising from illness, casualty loss, or death.
Cash needs arising from foreseeable events, such as the purchase or building of
a house or education expenses will not be considered to be the result of an
unforeseeable financial emergency. Payment shall be made as soon as practicable
after the Compensation Committee approves the payment and determines the amount
of the payment or number of shares which shall be withdrawn, in a single lump
sum. No Director shall participate in any decision of the Compensation Committee
regarding such Director's request for a withdrawal under this Section XI.
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SECTION XII - PAYMENT DATES; FAIR MARKET VALUE
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Director Fees payable currently in cash or to be credited to a Deferred
Cash Compensation Account shall be paid or credited, as the case may be, on such
dates as the Company's or the Subsidiary's management shall determine, but not
less frequently than June 30 and December 31 of each Plan Year. Director Fees
payable currently in shares of Common Stock or to be credited to a Deferred
Stock Compensation Account shall be paid or credited, as the case may be, on
June 30 and December 31 of each Plan Year, in each case covering the six-month
period ending on such date.
"Fair Market Value" of a share of Common Stock on a given date shall be
determined (i) based on the average of the closing sale prices of a share of
Common Stock for the ten (10) day trading period ending on the given date, as
reported on the National Association of Securities Dealers Automated Quotation
("Nasdaq") National Market and published in The Wall Street Journal, (ii) if no
closing sale prices are reported during such ten (10) day trading period, based
on the average of the mean of the bid and asked prices per share of Common Stock
for such ten (10) day trading period, as reported on Nasdaq, (iii) if the Common
Stock is listed on a stock exchange, based on the average of the closing sale
prices of a share of Common Stock for the ten (10) day trading period ending on
the given date, as reported in The Wall Street Journal, or (iv) if the Common
Stock is not listed on Nasdaq or on a stock exchange, by the Board of Directors
in its sole discretion.
SECTION XIII - SECURITIES LAWS; ISSUANCE OF SHARES
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The obligation of the Company to issue or credit shares of Common Stock
under the Plan shall be subject to (i) the effectiveness of a registration
statement under the Securities Act of 1933, as amended, with respect to such
shares, if deemed necessary or appropriate by counsel for the Company, (ii) the
condition that the shares shall have been listed (or authorized for listing upon
official notice of issuance) upon Nasdaq or each stock exchange, if any, on
which the shares of Common Stock may then be listed and (iii) all other
applicable laws, regulations, rules and orders which may then be in effect. If,
on the date on which any shares of Common Stock would be issued pursuant to a
Current Stock Election or credited to a Deferred Stock Compensation Account,
sufficient shares of Common Stock are not available under the Plan or the
Company is not obligated to issue shares pursuant to this Section XIII, then no
shares of Common Stock shall be issued or credited, but rather, in the case of a
Current Stock Election, cash shall be paid in payment of the Director Fees
payable, and in the case of a Deferred Stock Compensation Account, Director Fees
and dividends which would otherwise have been credited in shares of Common Stock
shall be credited in cash to a Deferred Cash
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Compensation Account in the name of the Director. The Compensation Committee
shall adopt appropriate rules and regulations to carry out the intent of the
immediately preceding sentence if the need for such rules and regulations
arises.
SECTION XIV - AMENDMENT,
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MODIFICATION, SUSPENSION OR TERMINATION
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The Company reserves the right, by and through the Board of Directors,
to amend, suspend or terminate all or any part of the Plan at any time;
provided, that no such amendment, suspension or termination shall adversely
affect the amounts or shares then credited to any Deferred Cash Compensation
Account or to any Deferred Stock Compensation Account. If this Plan is
terminated, distributions may be made at such time and in such manner as the
Board of Directors determines, regardless of the prior provisions of this Plan
and any elections made hereunder. The Compensation Committee will give prompt
written notice to each Director of any amendment, suspension or termination, or
any material modification of the Plan.
SECTION XV - GOVERNING LAW; PRONOUNS
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Except to the extent pre-empted by Federal law, the provisions of the
Plan shall be construed, administered and enforced in accordance with the
domestic internal law (but not the law of conflicts of law) of the Commonwealth
of Pennsylvania. Each masculine, feminine or neuter pronoun used herein shall be
deemed a reference to each other gender, as the content requires.
SECTION XVI - RESTATEMENT; EFFECTIVE DATE
-----------------------------------------
The Plan is an amendment and restatement of the Company's Deferred
Compensation Plan for Non-Employee Directors, originally adopted by the Board of
Directors effective January 1, 1995.
The amended and restated Plan was adopted by the Board of Directors on
December 18, 1996 and approved by the shareholders of the Company at its 1997
Annual Meeting. The amended and restated Plan is effective as of January 1, 1997
and shall continue in effect for a term through December 31, 2006, unless sooner
terminated under Section XIV. The Plan was further amended by the Board of
Directors on December 18, 2002.
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