Supercuts 2004 Annual Report Download - page 134

impair the rights of a Participant under an Award theretofore granted without the Participant’s consent, except such an amendment (a) made to
cause the Plan to comply with applicable law or (b) made to permit the Company or an Affiliate a tax deduction under applicable law. The
Committee may amend, alter or discontinue the terms of any Award theretofore granted, prospectively or retroactively, on the same conditions
and limitations (and exceptions to limitations) as apply to the Board, and further subject to any approval or limitations the Board may impose.
Notwithstanding the foregoing, any material amendments (as determined under the rules of the New York Stock Exchange, as amended from
time to time) to the Plan shall require shareholder approval.
12.2 Unfunded Status of Plan. It is intended that the Plan be an “unfunded” plan for incentive compensation. The Committee may authorize
the creation of trusts or other arrangements to meet the obligations created under the Plan to deliver Common Stock or make payments;
provided, however, that, unless the Committee otherwise determines, the existence of such trusts or other arrangements is consistent with the
“unfunded” status of the Plan.
12.3 Provisions Relating to Internal Revenue Code Section 162(m). It is the intent of the Company that Awards granted to persons who are
Covered Employees within the meaning of Section 162(m) of the Code shall constitute “qualified performance-based compensation” satisfying
the requirements of Code Section 162(m). Accordingly, the Plan shall be administered and the provisions of the Plan shall be interpreted in a
manner consistent with Code Section 162(m). If any provision of the Plan or any Agreement relating to such an Award does not comply or is
inconsistent with the requirements of Code Section 162(m), such provision shall be construed or deemed amended to the extent necessary to
conform to such requirements. In addition, the following provisions shall apply to the Plan or an Award to the extent necessary to obtain a tax
deduction for the Company or an Affiliate:
(1) Not later than the date required or permitted for “qualified performance-based compensation” under Code Section 162(m), the
Committee shall determine the Participants who are Covered Employees who will receive Awards that are intended as qualified
performance-based compensation and the amount or method for determining the amount of such compensation.
(2) During any three-consecutive calendar year period, the maximum number of shares of Common Stock for which Options and Stock
Appreciation Rights, in the aggregate, may be granted to any Participant shall not exceed [800,000] shares. For Performance Unit Awards
that are intended to be “performance-based compensation” (as that term is used in Code Section 162(m), no more than [$2,000,000] may be
subject to such Awards granted to any Participant during any three-consecutive calendar year period. If, after amounts have been earned
with respect to Performance Unit Awards, the payment of such amounts is deferred, any additional amounts attributable to earnings during
the deferral period shall be disregarded for purposes of this limit.
(3) Performance Goals. Awards may be subject to Performance Goals (as defined in Section 9.1) which shall be measured in a specific
Performance Period (as defined in Section 9.1) established by the Committee which shall be based on any of the following performance
criteria, either alone or in any combination, and on either a
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