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policies of the applicable subsidiary of the Company in effect at Performance Period attributable to such transaction or event.
the time of termination of employment, and (b) ‘‘retirement’’ shall Such adjustments shall be conclusive and binding for
mean termination of employment with all subsidiaries of the all purposes.
Company by the Participant after either attainment of age 65 or
ARTICLE III. MISCELLANEOUS
attainment of age 55 and the completion of at least ten (10) years
SECTION 3.1 NO RIGHTS TO AWARDS OR CONTINUED
of employment with the Company or its subsidiaries.
EMPLOYMENT ⬎⬎⬎ No employee of the Company or any of its
SECTION 2.4 DETERMINATION OF AWARDS ⬎⬎⬎ In the
subsidiaries shall have any claim or right to receive Awards under
manner required by Section 162(m) of the Code, the Committee
the Plan. Neither the Plan nor any action taken under the Plan
shall, promptly after the date on which the necessary financial or
shall be construed as giving any employee any right to be retained
other information for a particular Performance Period becomes
by the Company or any subsidiary of the Company.
available, certify the extent to which Performance Targets have
SECTION 3.2 NO LIMITS ON OTHER AWARDS AND
been achieved. Using the Performance Schedules, the Committee
PLANS ⬎⬎⬎ Nothing contained in this Plan shall prohibit the
shall determine the Performance Percentage applicable to each
Company or any of its subsidiaries from establishing other
Performance Target and multiply the portion of the Target Award
special awards or incentive compensation plans providing for the
to which the Performance Target relates by such Performance
payment of incentive compensation to employees of the
Percentage in order to arrive at the actual Award payout for
Company and its subsidiaries, including any Participants.
such portion.
SECTION 3.3 RESTRICTION ON TRANSFER ⬎⬎⬎ The rights of
At the time Target Awards are determined, the Committee may
a Participant with respect to Awards under the Plan shall not be
specify that the Performance Percentage attributable to any one
or more portions of a Participant’s Target Award may not exceed transferable by the Participant other than by will or the laws of
the Performance Percentage attributable to any other portion of descent and distribution.
the Participant’s Target Award. In the event such specification is SECTION 3.4 SOURCE OF PAYMENTS ⬎⬎⬎ The Company
made, actual Award payouts shall be determined accordingly. and its subsidiaries shall not have any obligation to establish any
SECTION 2.5 LIMITATIONS ON AWARDS ⬎⬎⬎ The aggregate separate fund or trust or other segregation of assets to provide
amount of all Awards under the Plan to any Participant for any for payments under the Plan. To the extent any person acquires
Performance Period shall not exceed $2,000,000. any rights to receive payments hereunder from the Company or
SECTION 2.6 PAYMENT OF AWARDS ⬎⬎⬎ Payment of any of its subsidiaries, such rights shall be no greater than those
Awards shall be made by the Company or the applicable of an unsecured creditor.
employer subsidiary as soon as administratively practical SECTION 3.5 EFFECTIVE DATE; TERM; AMENDMENT ⬎⬎⬎
following the certification by the Committee of the extent to The Plan is effective as of June 19, 1996, subject to approval by
which the applicable Performance Targets have been achieved the Company’s shareholders at the Company’s 1996 annual
and the determination of the actual Awards in accordance with meeting of shareholders, and shall remain in effect until such
Sections 2.4 and 2.5. All Awards under the Plan are subject to time as it shall be terminated by the Board of Directors of the
withholding, where applicable, for federal, state and local taxes. Company. If approval of the Plan meeting the requirements of
SECTION 2.7 ADJUSTMENT OF AWARDS ⬎⬎⬎ In the event Section 162(m) of the Code is not obtained at the 1996 annual
of the occurrence during the Performance Period of any meeting of shareholders of the Company, then the Plan shall not
recapitalization, reorganization, merger, acquisition, divestiture, be effective and any Award made on or after June 19, 1996, shall
consolidation, spin-off, split-off, combination, liquidation, be void ab initio. The Board of Directors may at any time and
dissolution, sale of assets, other similar corporate transaction or from time to time alter, amend, suspend or terminate the Plan in
event, any changes in applicable tax laws or accounting whole or in part.
principles, or any unusual, extraordinary or nonrecurring events SECTION 3.6 PROHIBITED OR UNENFORCEABLE
involving the Company which distorts the performance criteria PROVISIONS ⬎⬎⬎ Any provision of the Plan that is prohibited
applicable to any Performance Target, the Committee shall adjust or unenforceable shall be ineffective to the extent of such
the calculation of the performance criteria, and the applicable prohibition or unenforceability without invalidating the remaining
Performance Targets as is necessary to prevent reduction or provisions of the Plan.
enlargement of Participants’ Awards under the Plan for such
H&R BLOCK 2005 Proxy Statement
B-2