Pottery Barn 2004 Annual Report Download - page 115

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will be paid (or will be granted, as the case may be) in full or on a prorated basis in the event that, before the end
of such award period, the participant dies, becomes “disabled,” retires in accordance with the Company’s
policies, is involuntarily terminated by the Company without “cause,” or voluntarily terminates his or her
employment with the Company for “good reason,” or if a “change in control” of the Company occurs. For
purposes of this Section 6.4, the terms “cause,” “good reason,” and “change in control” shall be as defined in the
participant’s employment agreement with the Company, or, if not so defined, shall be defined in writing by the
Committee at the time of the grant of the award. In the event that an award is paid pursuant to this Section 6.4,
then the award shall not constitute performance-based compensation under Code Section 162(m).
7. Nonassignment. The interest of any participant in this Plan is not assignable either by
voluntary or involuntary assignment or operation of law (except that, in the event of death, earned and unpaid
amounts shall be payable to the legal successor of a participant).
8. Indemnification. No employee, member of the Committee or director of the Company will
have any liability for any decision or action if made or done in good faith, nor for any error or miscalculation
unless such error or miscalculation is the result of his or her fraud or deliberate disregard of any provisions of this
Plan. The Company will indemnify each director, member of the Committee and any employee acting in good
faith pursuant to the Plan against any loss or expense arising therefrom.
9. Amendment, Suspension or Termination. The Board may from time to time amend,
suspend or terminate, in whole or in part, any or all the provisions of this Plan; provided, however, that no such
action shall adversely affect the right of any participant with respect to any award of which he or she may have
become entitled to payment hereunder prior to the effective date of such amendment, suspension or termination.
In particular, but without limitation, the Board shall have the authority to amend or modify this Plan from time to
time in order to reflect amendments to or regulations promulgated under Section 162(m) of the Code.
Notwithstanding the foregoing, in the event that any amendment or other modification of or to this Plan raises the
limits set forth in Section 5.2 or requires stockholder approval in order to continue the compliance of this Plan as
a “performance-based” plan under Section 162(m) of the Code, such amendment or modification shall be
contingent on the receipt of stockholder approval.
10. Limitations; Participation in Other Plans. This Plan is not to be construed as constituting
a contract of employment or for services. Nothing contained herein will affect or impair the Company’s right to
terminate the employment or other contract for services of a participant hereunder, with or without cause or
notice, or entitle a participant to receive any particular level of compensation. The Company’s obligation
hereunder to make awards merely constitutes the unsecured promise of the Company to make such awards from
its general assets, and no participant hereunder will have any interest in, or a lien or prior claim upon, any
property of the Company. Nothing herein nor the participation by any participant shall limit the ability of such
participant to participate in any other compensatory plan or arrangement of the Company, or to receive a bonus
from the Company other than under this Plan.
11. Governing Law. The terms of this Plan will be governed by and construed in accordance
with the laws of the State of California, without regard to principles of conflict of laws.
12. Term. This Plan shall continue in place until the fifth anniversary of the effective date of the
amendment and restatement of the Plan, which date shall be January 25, 2011, unless earlier terminated by the
Board as provided in Section 9 or re-approved by the Company’s shareholders at or before such meeting. No
awards shall be paid under this Plan unless and until the material terms (within the meaning of Section
162(m)(4)(C) of the Code) of this Plan are disclosed to the Company’s shareholders and are approved by the
shareholders by a majority of votes cast in person or by proxy.
A-3
Exhibits