GRACO INC
EXHIBIT 10.23, EMPLOYEE STOCK INCENTIVE PLAN
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<FILENAME>exh10pt23_esip.htm
<DESCRIPTION>EXHIBIT 10.23, EMPLOYEE STOCK INCENTIVE PLAN
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<TITLE>Exhibit 10, Employee Stock Incentive Plan</TITLE>
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<P ALIGN=RIGHT><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>Exhibit 10.23 </FONT></P>


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<P ALIGN=RIGHT><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>June 6, 2002 </FONT></P>

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<H1 ALIGN=CENTER><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>EMPLOYEE STOCK
INCENTIVE PLAN </FONT></H1>

<!-- MARKER FORMAT-SHEET="Para (List) Indent Lv 0- Arial" FSL="Project" -->
     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>1.&nbsp;&nbsp;&nbsp;&nbsp;Purpose.</B> The purpose of the Graco Inc. Employee Stock Incentive Plan (the
          &#147;Plan&#148;) is to promote the best interests of Graco Inc. (the
          &#147;Company&#148;) and its shareholders by providing employees of the Company
          and its subsidiaries the opportunity to acquire a proprietary interest in the
          Company and thus develop a strong incentive to put forth their best efforts and
          support changes to further the growth in earnings and market appreciation of the
          Company. The Company intends that the Plan will thereby facilitate securing,
          retaining and motivating employees of high caliber. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>2.&nbsp;&nbsp;&nbsp;&nbsp;Administration. </B> (a) The Plan shall be administered by a committee (the
          &#147;Committee&#148;) selected by the Board of Directors of the Company (the
          &#147;Board&#148;) and consisting of members of the Board. The Committee shall
          have full and final authority, in its discretion, to interpret the provisions of
          the Plan and to decide all questions of fact arising in its application; to
          determine the employees to whom awards shall be made under the Plan; to
          determine the type of award to be made and the amount, size, terms and
          conditions of each such award; to determine and establish additional terms and
          conditions not inconsistent with the Plan and any agreements entered into with
          participants in connection with the Plan or any stock option award document
          issued pursuant to the Plan; to determine the time when awards will be granted
          and when rights may be exercised, which may be after termination of employment;
          and to make all other determinations necessary or advisable for the
          administration of the Plan. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b)&nbsp;&nbsp;&nbsp;&nbsp;The Committee shall select one of its members as its Chairman and shall hold its
          meetings at such times and places as it may determine. A majority of its members
          shall constitute a quorum. All determinations of the Committee shall be made by
          not less than a majority of its members. Any decision or determination reduced
          to writing and signed by all of the members of the Committee shall be fully
          effective as if it had been made by a majority vote at a meeting duly called and
          held. The Committee may appoint a Secretary and may make such rules and
          regulations for the conduct of its business as it shall deem advisable. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c)&nbsp;&nbsp;&nbsp;&nbsp;The Committee may delegate all or any part of its authority under this Plan to
          the Chief Executive Officer of the Company for purposes of making the
          determinations set forth in subparagraph (a) above and elsewhere in the Plan.
          The Chief Executive Officer may, in turn, delegate such authority to such other
          executive officer of the Company as the Chief Executive Officer may determine. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>3.&nbsp;&nbsp;&nbsp;&nbsp;Participants.</B> Persons eligible to participate in the Plan shall be those
          employees of the Company or its subsidiaries who are not officers of the
          Company, as officer is defined in Section 16 of the Securities Exchange Act of
          1934 and the rules thereunder. Such officers shall not be eligible to receive
          awards under the Plan. For the purpose of all awards made under the Plan, the
          term &#147;subsidiary&#148; shall have the meaning given to it by Rule 405
          promulgated under the Securities Act of 1933, as amended. References to
          &#147;the Company&#148; in this Plan or in any option or other award granted
          pursuant to the Plan shall be deemed to include a reference to subsidiaries if
          appropriate. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>4.&nbsp;&nbsp;&nbsp;&nbsp;Awards under the Plan</B>. Awards by the Committee under the Plan shall be in
          the form of stock options which do not qualify for special tax treatment under
          Section 422 of the Internal Revenue Code of 1986, as amended from time to time. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>5.&nbsp;&nbsp;&nbsp;&nbsp;Shares Subject to the Plan.</B> The shares that may be issued under the Plan
          shall not exceed in the aggregate 2,250,000 common shares, $1.00 par value, of
          the Company. Except as otherwise provided herein, any shares subject to an
          option which for any reason expires or terminates without issuance or final
          vesting of such shares shall again be available under the Plan. No fractional
          shares shall be issued under the Plan. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>6.&nbsp;&nbsp;&nbsp;&nbsp;Stock Options.</B> Stock options shall be evidenced by a stock option award
          document in such form not inconsistent with the Plan as the Committee shall
          approve from time to time, which document shall contain in substance the
          following terms and conditions. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.1.&nbsp;&nbsp;&nbsp;&nbsp;Option Price. </B> The purchase price per common share deliverable upon the
          exercise of an option shall not be less than 100% of the fair market value of
          the stock on the day the option is granted, as determined by the Committee. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.2.&nbsp;&nbsp;&nbsp;&nbsp;Exercise of Option.</B> Each stock option document shall state the period or
          periods of time within which the option may be exercised by the participant, in
          whole or in part, which shall be such period or periods of time as may be
          determined by the Committee, provided that the option period shall not end later
          than ten years after the date of the grant of the option. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>6.3.&nbsp;&nbsp;&nbsp;&nbsp;Payment of Shares.</B> A person holding an option (&#147;optionee&#148;) awarded
          under the plan shall notify the Company in writing when the person wishes to
          exercise the option and designate the number of shares the person wishes to
          exercise. The full purchase price of such shares shall be tendered with such
          notice of exercise or, at the discretion of the Committee, pursuant to any
          arrangements satisfactory to the Committee which provide that the Company will
          be paid at the time the shares are delivered to the optionee or his or her
          designee. Payment shall be made either in cash (including check, bank draft or
          money order) or, at the discretion of the Committee, (i) by delivering the
          Company&#146;s common shares already owned by the optionee having a fair market
          value equal to the full purchase price of the shares, or (ii) by a reduction in
          the number of shares delivered upon exercise of the option (iii) a combination
          of cash and such shares (in each case such shares having an aggregate fair
          market value on the date of exercise equal to the amount of the purchase price
          being paid through such delivery or reduction of shares). </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>7.&nbsp;&nbsp;&nbsp;&nbsp;Fair Market Value.</B> The fair market value of a share of the Company&#146;s
          common stock is the last sale price reported on the composite tape by the New
          York Stock Exchange on the business day immediately preceding the date as of
          which fair market value is being determined or, if there were no sales of shares
          of the Company&#146;s common stock reported on the composite tape on such day,
          on the most recently preceding day on which there were sales, or if the shares
          of the Company&#146;s stock are not listed or admitted to trading on the New
          York Stock Exchange on the day as of which the determination is made, the amount
          determined by the Committee to be the fair market value of a share on such day. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>8.&nbsp;&nbsp;&nbsp;&nbsp;General Restrictions.</B> Each award under the Plan shall be subject to the
          requirement that if, at anytime the Committee shall determine that (a) the
          listing, registration or qualification of the common shares subject or related
          thereto upon any securities exchange or under any state or federal law, or (b)
          the consent or approval of any government regulatory body, or (c) an agreement
          by the recipient of an award with respect to the disposition of common shares,
          is necessary or desirable in connection with the granting of such award or the
          issue or purchase of common shares thereunder, such award may not be consummated
          in whole or in part unless such listing, registration, qualification, consent,
          approval or agreement shall have been effected or obtained free of any
          conditions not acceptable to the Committee. A participant shall, as a condition
          of receiving any award under the Plan, execute any documents, make any
          representations, comply with restrictions on stock transferability and take any
          actions which in the opinion of legal counsel to the Company is required by any
          applicable law, ruling or regulation. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>9.&nbsp;&nbsp;&nbsp;&nbsp;Rights of a Shareholder.</B> The recipient of any award under the Plan, unless
          otherwise provided by the Plan, shall have no rights as a shareholder with
          respect thereto unless and until certificates for common shares are issued to
          the recipient. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>10.&nbsp;&nbsp;&nbsp;&nbsp;Right to Terminate Employment.</B> Nothing in the Plan or in any agreement
          entered into pursuant to the Plan, or in any stock option award document, shall
          confer upon any participant the right to continue in the employment of the
          Company or its subsidiaries, or affect any right which the Company or such
          subsidiaries may have to terminate the employment of the participant. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>11.&nbsp;&nbsp;&nbsp;&nbsp;
          Withholding.</B> </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>11.1.&nbsp;&nbsp;&nbsp;&nbsp;Payment of Withholding Taxes.</B> Whenever the Company proposes or is required
          to issue or transfer common shares under the Plan, the Company shall have the
          right to require the recipient to remit to the Company, or provide
          indemnification satisfactory to the Company for, an amount sufficient to satisfy
          any federal, state or local withholding tax requirements prior to the issuance
          or delivery of any certificate or certificates for such shares. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>11.2.&nbsp;&nbsp;&nbsp;&nbsp;Use of Common Shares to Satisfy Tax Obligation.</B> In order to assist an
          optionee or grantee in paying all federal, state and local taxes to be withheld
          or collected upon exercise of an option, the Committee in its sole discretion
          and subject to such rules as it may adopt, may permit the optionee or grantee to
          satisfy such tax obligation, in whole or in part, by (i) electing to have the
          Company withhold common shares otherwise to be delivered with a fair market
          value equal to the amount of such tax obligation, or (ii) electing to surrender
          to the Company previously owned common shares with a fair market value equal to
          the amount of such tax obligation. The election must be made on or before the
          date that the amount of tax to be withheld is determined. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>12.&nbsp;&nbsp;&nbsp;&nbsp;Non-Assignability.</B> No award under the Plan shall be assignable or
          transferable by the participant except by will or by laws of descent and
          distribution. During the life of a participant, such award shall be exercisable
          only by the participant or by the participant&#146;s guardian or legal
          representative. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>13.&nbsp;&nbsp;&nbsp;&nbsp;Non-Uniform Determinations.</B> The Committee&#146;s determinations under the
          Plan (including, without limitation, determinations of the persons to receive
          awards, the form, amount and timing of such awards, the terms and provisions of
          awards and the stock option award documents evidencing the awards, and the
          establishment of values and performance targets) need not be uniform and may be
          made by it selectively among persons who receive, or are eligible to receive,
          awards under the Plan whether or not such persons are similarly situated. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>14.&nbsp;&nbsp;&nbsp;&nbsp;Dissolution, Liquidation, Merger.</B> In the event of (a) the proposed
          dissolution or liquidation of the Company, (b) a proposed sale of substantially
          all of the assets of the Company, or (c) a proposed merger, consolidation of the
          Company with or into any other entity, regardless of whether the Company is the
          surviving corporation, or a proposed statutory share exchange with any other
          entity (the actual effective date of the dissolution, liquidation, sale, merger,
          consolidation or exchange being herein called an &#147;Event&#148;), the
          Committee may, but shall not be obligated to, either (i) if the Event is a
          merger, consolidation or statutory share exchange, make appropriate provision
          for the protection of outstanding options granted under this Plan by the
          substitution, in lieu of such options, of options to purchase appropriate voting
          common stock (the &#147;Survivor&#146;s Stock&#148;) of the corporation
          surviving any such merger or consolidation or, if appropriate, the parent
          corporation of the Company or such surviving corporation, or, alternatively, by
          the delivery of a number of shares of the Survivor&#146;s Stock which has a Fair
          Market Value as of the effective date of such merger, consolidation or statutory
          share exchange equal to the product of (x) the excess of (A) the Event Proceeds
          per Share (as hereinafter defined) covered by the option as of such effective
          date over (B) the exercise price per Share of the Shares subject to such option,
          times (y) the number of Shares covered by such option, or (ii) declare, at least
          twenty days prior to the Event, and provide written notice to each optionee of
          the declaration, that each outstanding option, whether or not then exercisable,
          shall be canceled at the time of, or immediately prior to the occurrence of, the
          Event (unless it shall have been exercised prior to the occurrence of the
          Event). In connection with any declaration pursuant to clause (ii) of the
          preceding sentence, the Committee may, but shall not be obligated to, cause
          payment to be made, within twenty days after the Event, in exchange for each
          cancelled option to each holder of an option that is cancelled, of cash equal to
          the amount (if any), for each Share covered by the canceled option, by which the
          Event Proceeds per Share (as hereinafter defined) exceeds the exercise price per
          Share covered by such option. At the time of any declaration pursuant to clause
          (ii) of the first sentence of this paragraph 14, each option that has not
          previously expired or been cancelled pursuant to any stock option award document
          issued shall immediately become exercisable in full and each holder of an option
          shall have the right, during the period preceding the time of cancellation of
          the option, to exercise his or her option as to all or any part of the Shares
          covered thereby. In the event of a declaration pursuant to clause (ii) of the
          first sentence of this paragraph 14, each outstanding option granted pursuant to
          this Plan that shall not have been exercised prior to the Event shall be
          canceled at the time of, or immediately prior to, the Event, as provided in the
          declaration, and this Plan shall terminate at the time of such cancellation,
          subject to the payment obligations of the Company provided in this Paragraph 14.
          Notwithstanding the foregoing, no person holding an option shall be entitled to
          the payment provided in this paragraph 14 if such option shall have expired or
          been cancelled pursuant to any stock option award document issued to this Plan.
          For purposes of this paragraph 14, &#147;Event Proceeds per Share&#148; shall
          mean the cash plus the fair market value, as determined in good faith by the
          Committee, of the non-cash consideration to be received per Share by the
          shareholders of the Company upon the occurrence of the Event. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
15.&nbsp;&nbsp;&nbsp;&nbsp;Adjustments in Shares. </B>In the event of any reorganization, merger,
          consolidation, recapitalization, liquidation, reclassification, stock dividend,
          stock split, combination of shares, rights offering, or extraordinary dividend
          or divestiture (including a spin-off), or any other change in the corporate
          structure or shares of the Company, the Committee (or if the Company does not
          survive any such transaction, a comparable committee of the Board of Directors
          of the surviving corporation) may, without the consent of any holder of an
          option, make such adjustment as it determines in its discretion to be
          appropriate as to the number and kind of securities subject to and reserved
          under this Plan and, in order to prevent dilution or enlargement of rights of
          participants in this Plan, the number and kind of securities issuable upon
          exercise of outstanding options and the exercise price thereof.</FONT></P>


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<H1 ALIGN=LEFT><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16.&nbsp;&nbsp;&nbsp;&nbsp;Miscellaneous</B> </FONT> </H1>

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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16.1.&nbsp;&nbsp;&nbsp;&nbsp;Adoption. </B> This Plan was originally adopted in February 1999 as the Graco
          Inc. Employee Stock Incentive Plan. </FONT></P>


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<P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16.2.&nbsp;&nbsp;&nbsp;&nbsp;Amendment. </B>The Board may amend, suspend, or terminate the Plan at any time. </FONT></P>


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     <P ALIGN=JUSTIFY><FONT FACE="Arial, Helvetica, Sans-Serif" SIZE=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<B>16.3.&nbsp;&nbsp;&nbsp;&nbsp;Termination. </B>Unless the Plan shall have been discontinued at an earlier
          date, the Plan shall terminate on February 28, 2009. No option may be granted
          after such termination, but termination of the Plan shall not, without the
          consent of the optionee or grantee, alter or impair any rights or obligations
          under any award theretofore granted. </FONT></P>

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