The participant’s target incentive

The total target incentives of all business unit participants at any time during the fiscal year (even if a participant ceases being a participant during that fiscal year)

The amount of the business unit pool

~~4.4~~ ~~Common Stock. To~~Each Participant’s target incentive will be a dollar amount equal to a percentage of the ~~extent that~~Participant’s annual base salary, with such percentage based upon the ~~Corporation has such shares of Common Stock available to it and can issue such shares without violating any law or regulation, the Corporation will reserve Common Stock for issuance~~Participant’s position with respect to an Award payable in Common Stock. The shares of Common Stock which may be issued under the Plan may be either authorized but unissued shares or shares previously issued and thereafter acquired by the Corporation or partly each, as shall be determined from time to time by the Board.

~~4.5~~ ~~Adjustment and Substitution of Shares~~. In the event of a merger, consolidation, acquisition of shares, stock rights offering, liquidation, separation, spinoff, disaffiliation of a Subsidiary from the Corporation, extra-ordinary dividend of cash or other property, ~~or similar event affecting~~ the Corporation or any ~~of its Subsidiaries (each, a “Corporate Transaction”),~~Subsidiary and the Committee or the Board shall make such substitutions or adjustments as it deems appropriate and equitable to prevent the dilution or enlargement of the rights of Participants to (A) the aggregate number and kind of shares of Common Stock reservedcomparable industry data for issuance and delivery under the Plan, (B) the various maximum limitations set forth in Sections 4.1 and 4.2 upon certain types of Awards and upon the Awards to individuals, (C) the number and kind of shares of Common Stock subject to outstanding Awards; and (D) the exercise price of outstanding Awards. In the event of a stock dividend, stock split, reverse stock split, reorganization, share combination, or recapitalization or similar event affecting the capital structure of the Corporation (each, a “Share Change”), the Committee or the Board shall make such substitutions or adjustments as it deems appropriate and equitable to prevent the dilution or enlargement of the rights of Participants to (A) the aggregate number and kind of shares of Common Stock reserved for issuance and delivery under the Plan, (B) the various maximum limitations set forth in Sections 4.1 and 4.2 upon certain types of Awards and upon the Awards to individuals, (C) the number and kind of shares of Common Stock subject to outstanding Awards; and (D) the exercise price of outstanding Awards. In the case of Corporate Transactions, such adjustments may include, without limitation, (1) the cancellation of outstanding Awards in exchange for payments of cash, property or a combination thereof having an aggregate value equal to the value of such Awards,that position, as determined by the Committee based upon such sources on which the Committee determines to rely, provided, however, that the target incentive of any Participant added during a Fiscal Year with respect to a pool shall be prorated as determined by the Committee. Notwithstanding the foregoing, if any employee who otherwise would have been designated as a Participant in a Business Unit pool has a separate and individualized incentive plan or bonus arrangement with the ~~Board~~Corporation or any Subsidiary, the amount of the Business Unit pool to be allocated under this Section 4.3 shall be reduced prior to the other computations set forth in ~~its sole discretion (it being understood that~~this Section 4.3(a) by the greater of (i) the amount of the Business Unit pool which the employee would have received based upon the target incentive the employee would have had if the employee had been a Participant in the Business Unit pool (the “Hypothetical Target Incentive”) or (ii) any amount payable under such incentive plan or bonus arrangement. The Committee shall designate any such employee and plans and arrangements and any Hypothetical Target Incentives at the time Awards are granted for a Business Unit pool.

(b) Relative Performance. The amount of any Business Unit pool allocated to a Participant under Section 4.3(a) also may be further reduced (but not increased) based on the Participant’s relative performance in achieving overall results for the Business Unit. Notwithstanding any other provision of the Plan, a reduction of the amount of any Business Unit pool allocated to a Participant pursuant to the immediately preceding sentence shall not result in an increase in the amount of such Business Unit Pool allocated to any other Participant. Relative performance will be determined by the Participant’s achievement against quantifiable objectives set at the beginning of the Fiscal Year and may be further adjusted (i) in the case of Covered Employees, by the Committee’s subjective rating, (ii) in the case of a ~~Corporate Transaction with respect to which shareholders of Common Stock receive consideration other than publicly-traded equity securities of the ultimate surviving entity, any such determination~~Division President, by the Committee that the value of an option or stock appreciation right shall for this purpose be deemed to equal the excess, if any, of the value of the consideration being paid for each share pursuant to such Corporate Transaction over the exercise price of such option or stock appreciation right shall conclusively be deemed valid); (2) the substitution of other property (including, without limitation, cash or other securities of the CorporationChief Executive Officer’s subjective rating, and securities of entities other than the Corporation) for the shares subject to outstanding Awards; and (3) in connection with any disaffiliation of a Subsidiary, arranging for the assumption of Awards, or replacement of Awards with new Awards based on other property or other securities (including, without limitation, other securities of the Corporation and securities of entities other than the Corporation), by the affected Subsidiary, or by the entity that controls such Subsidiary following such disaffiliation (as well as any corresponding adjustments to Awards that remain based upon Corporation securities). The Committee shall adjust the Performance Goals applicable to any Awards to reflect any unusual or non-recurring events and other extraordinary items, impact of charges for restructurings, discontinued operations, and the cumulative effects of accounting or tax changes, each as defined by generally accepted accounting principles or as identified in the Corporation’s financial statements, notes to the financial statements, management’s discussion and analysis or other of the Corporation’s SEC filings, ~~provided~~ ~~that~~(iii) in the case of ~~Performance Goals applicable to any Qualified Performance-Based Awards, such adjustment does not violate Section 162(m) of~~Participants other than the ~~Code~~Division President or ~~cause such Awards not to qualify for~~Covered Employees, by either the ~~Section 162(m) Exemption, as defined in Section 12.1. No adjustment~~Division President’s or ~~substitution provided in this Section 4.5 shall require~~ the Corporation or any other entity to issue or sell a fraction of a share or other security. Except as provided in this Section 4.5, a Participant shall not have any rights with respect to any Corporate Transaction or Share Change.Chief Executive Officer’s subjective rating.

~~4.6~~ ~~Section 409A; Section 162(m); Incentive Stock Options~~. Notwithstanding the foregoing: (i) any adjustments made pursuant to Section 4.5 to Awards that are considered “deferred compensation” within the meaning of Section 409A of the Code shall be made in compliance with the requirements of Section 409A of the Code; (ii) any adjustments made pursuant to Section 4.5 to Awards that are not considered “deferred compensation” subject to Section 409A of the Code shall be made in such a manner as to ensure that after such adjustment, the Awards either (A) continue not to be subject to Section 409A of the Code or (B) comply with the requirements of Section 409A of the Code; and (iii) in any event, neither the Committee nor the Board shall have the authority to make any adjustments pursuant to Section 4.5 to the extent the existence of such authority would cause an Award that is not intended to be subject to Section 409A of the Code at the grant date of the Award to be subject thereto. If any such adjustment or substitution provided for in Section 4.5 requires the approval of shareholders in order to enable the Corporation to grant incentive stock options or to comply with Section 162(m) of the Code, then no such adjustment or substitution shall be made without the required shareholder approval. Notwithstanding the foregoing, in the case of incentive stock options, if the effect of any such adjustment or substitution would be to cause the option to fail to continue to qualify as an incentive stock option or to cause a modification, extension or renewal of such option within the meaning of Section 424 of the Code, the Committee may determine that such adjustment or substitution not be made but rather shall use reasonable efforts to effect such other adjustment of each then outstanding incentive stock option as the Committee, in its sole discretion, shall deem equitable and which will not result in any disqualification, modification, extension or renewal (within the meaning of Section 424 of the Code) of such incentive stock option.

~~SECTION 5~~

~~Grant of Stock Options and Stock Appreciation Rights~~

~~5.1~~ ~~Types of Options; Limit on Incentive Stock Options~~. The Committee shall have authority, in its sole discretion, to grant "incentive stock options" pursuant to Section 422 of the Code, to grant "nonstatutory stock options" (i.e., stock options which do not qualify under Sections 422 or 423 of the Code) or to grant both types of stock options (but not in tandem). Notwithstanding any other provision contained in the Plan or in any agreement under Section 2.5, but subject to the possible exercise of the Committee's discretion contemplated in the last sentence of this Section 5.1, the aggregate Fair Market Value on the date of grant of the shares with respect to which such incentive stock options are exercisable for the first time by a Participant during any calendar year under all plans of the corporation employing such Participant, any parent or subsidiary corporation of such corporation and any predecessor corporation of any such corporation shall not exceed $100,000. If the date on which one or more incentive stock options could first be exercised would be accelerated pursuant to any provision of the Plan or any agreement under Section 2.5 and the acceleration of such exercise date would result in a violation of the $100,000 restriction set forth in the preceding sentence, then, notwithstanding any such provision, but subject to the provisions of the next succeeding sentence, the exercise dates of such incentive stock options shall be accelerated only to the extent, if any, that does not result in a violation of such restriction and, in such event, the exercise dates of the incentive stock options with the lowest option prices shall be accelerated to the earliest such dates. The Committee may, in its sole discretion, authorize the acceleration of the exercise date of one or more incentive stock options even if such acceleration would violate the $100,000 restriction set forth in the second sentence of this Section 5.1 and even if one or more such incentive stock options are thereby converted in whole or in part to nonstatutory stock options.

~~5.2~~ ~~Types and Nature of Stock Appreciation Rights~~. Stock appreciation rights may be tandem stock appreciation rights which are granted in conjunction with incentive stock options or nonstatutory stock options (“Tandem SARs”), or stock appreciation rights which are not granted in conjunction with options (“Free-Standing SARs”). Upon the exercise of a stock appreciation right, the Participant shall be entitled to receive an amount in cash, shares of Common Stock, or both, in value equal to the product of (i) the excess of the Fair Market Value of one share of Common Stock on the date of exercise of the stock appreciation right over, in the case of a Tandem SAR, the exercise price of the related option, or in the case of a Free-Standing SAR, the Base Price per share (the “Spread”), multiplied by (ii) the number of shares of Common Stock in respect of which the stock appreciation right has been exercised. Notwithstanding the foregoing, the Committee at the time it grants a stock appreciation right may provide that the Spread covered by such stock appreciation right may not exceed a lower specified amount. The applicable agreement under Section 2.5 governing the stock appreciation rights shall specify whether such payment is to be made in cash or Common Stock or both, or shall reserve to the Committee or the Participant the right to make that determination prior to or upon the exercise of the stock appreciation right. Tandem SARs may be granted at the grant date of the related stock options or, in the case of a related nonstatutory stock option, also at a later date. At the time a Tandem SAR is granted, the Committee may limit the exercise period for such Tandem SAR, before and after which period no Tandem SAR shall attach to the underlying stock option. In no event shall the exercise period for a Tandem SAR exceed the exercise period for the related stock option. A Tandem SAR shall be exercisable only at such time or times and to the extent that the related option is exercisable in accordance with the provisions of this Section 5. A Tandem SAR shall terminate or be forfeited upon the exercise or forfeiture of the related stock option, and the related stock option shall terminate or be forfeited upon the exercise or forfeiture of the Tandem SAR. Any Tandem SAR granted with a related incentive stock option shall be exercisable only when the Fair Market Value of a share of Common Stock exceeds the exercise price for a share of Common Stock under the related incentive stock option.

~~5.3~~ ~~Exercise Price and Base Price~~. The exercise price per share of Common Stock subject to an option and any Tandem SAR, and the base price per share for any Free-Standing SAR (the “Base Price”), shall be determined by the Committee and set forth in the applicable agreement under Section 2.5, and shall not be less than the Fair Market Value of a share of the Common Stock on the applicable grant date, except that in the case of an incentive stock option granted to a Participant who, immediately prior to such grant, owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of stock of the Corporation or any Subsidiary which is a corporation (a "Ten Percent Employee"), the exercise price shall not be less than one hundred ten percent (110%) of the Fair Market Value on the date of grant. For purposes of this Section 5.3, an individual (i) shall be considered as owning not only shares of stock owned individually but also all shares of stock that are at the time owned, directly or indirectly, by or for the spouse, ancestors, lineal descendants and brothers and sisters (whether by the whole or half blood) of such individual and (ii) shall be considered as owning proportionately any shares owned, directly or indirectly, by or for any corporation, partnership, estate or trust in which such individual is a shareholder, partner or beneficiary. In no event may any option or stock appreciation right granted under this Plan, other than pursuant to Section 4.5, be amended to decrease the exercise price or Base Price thereof, be cancelled in conjunction with the grant of any new option or stock appreciation right with a lower exercise price or Base Price, be cancelled or repurchased for cash, property, or another Award at a time when the exercise price or Base Price is greater than the Fair Market Value of the underlying Common Stock, or otherwise be subject to any action that would be treated, for accounting purposes, as a “repricing” of such option or stock appreciation right, unless such amendment, cancellation, or action is approved by the Corporation’s shareholders.

~~5.4~~ ~~Term; Vesting and Exercisability~~. The term of each option and each stock appreciation right shall be fixed by the Committee, but shall not exceed ten years from the date of grant (five years in the case of an incentive stock option granted to a Ten Percent Employee). Except as otherwise provided herein, options and stock appreciation rights shall be exercisable at such time or times and subject to such terms and conditions as shall be determined by the Committee and may be exercisable commencing with the grant date.

~~5.5~~ ~~Method of Exercise~~. Subject to the provisions of this Section 5, options and stock appreciation rights may be exercised, in whole or in part (unless otherwise specified by the Committee in its sole discretion), at any time during the applicable term by giving written notice of exercise to the Corporation specifying the number of shares of Common Stock as to which the option or stock appreciation rights is being exercised. In the case of the exercise of an option, such notice shall be accompanied by payment in full of the exercise price in United States of America dollars by certified or bank check or wire of immediately available funds. If approved by the Committee (at the time of grant in the case of an incentive stock option or at any time in the case of a nonstatutory stock option), payment, in full or in part, may also be made as follows:

(a) Payment may be made in the form of unrestricted shares of Common Stock (by delivery of such shares or by attestation) of the same class as the Common Stock subject to the option already owned by the Participant (based on the Fair Market Value of the Common Stock on the date the option is exercised) provided however, that any portion of the exercise price representing a fraction of a share shall be paid in cash;

(b) To the extent permitted by applicable law, payment may be made by delivering a properly executed exercise notice to the Corporation, together with a copy of irrevocable instructions to a broker to deliver promptly to the Corporation the amount of sale or loan proceeds necessary to pay the exercise price, and, if requested, the amount of any federal, state, local or foreign withholding taxes. To facilitate the foregoing, the Corporation may, to the extent permitted by applicable law, enter into agreements for coordinated procedures with one or more brokerage firms. In the event the broker sells any shares on behalf of a Participant, the broker shall be acting solely as the agent of the Participant, and the Corporation disclaims any responsibility for the actions of the broker in making any such sales; and/or

~~(c) With such other instrument as approved by the Committee, including Corporation loans, to the extent permitted by applicable law.~~

~~5.6~~ ~~Delivery; Rights of Shareholders~~. No shares shall be delivered pursuant to the exercise of an option until the exercise price for the option has been fully paid and applicable taxes have been withheld. Unless otherwise specified by the Committee, the applicable Participant shall have all of the rights of a shareholder of the Corporation holding Common Stock with respect to the shares of Common Stock to be issued upon the exercise of the option or stock appreciation right (including the right to vote the applicable shares and the right to receive dividends), when the Participant (i) has given written notice of exercise in accordance with the procedures established by the Committee, (ii) if requested, has given the representation described in Section 10, and (iii) in the case of an option, has paid in full the exercise price for such shares.

5445

~~5.7~~ ~~Nontransferability of Options and Stock AppreciationRights~~(c) Extraordinary Events. Unless the Committee shall otherwise determine in the case of nonstatutory stock options and stock appreciation rights and limited to a transfer without the payment of value or consideration to the Participant, (i) no option or stock appreciation right shall be transferable by a Participant other than by will, or if the Participant dies intestate, by the laws of descent and distribution of the state of domicile of the Participant at the time of death, and (ii) all stock options and stock appreciation rights shall be exercisable during the lifetime of the Participant only by the Participant (or the Participant’s guardian or legal representative). Any Tandem SAR shall be transferable only when the related stock option is transferable and with the related stock option.

~~5.8~~ ~~Termination of Employment~~. Unless the Committee, in its sole discretion, shall otherwise determine at the time of grant of the Award or, other than in the case of incentive stock options, thereafter, but subject to the provisions of Section 5.1 in the case of incentive stock options:

(a) If the employment of a Participant who is not disabled within the meaning of Section 422(c)(6) of the Code (a "Disabled Participant") is voluntarily terminated with the consent of the Corporation or a Subsidiary or a Participant retires under any retirement plan of the Corporation or a Subsidiary, any then outstanding incentive stock option held by such Participant shall be exercisable by the Participant (but only to the extent exercisable by the Participant immediately prior to the termination of employment) at any time prior to the expiration date of such incentive stock option or within three months after the date of termination of employment, whichever is the shorter period;

(b) If the employment of a Participant who is not a Disabled Participant is voluntarily terminated with the consent of the Corporation or a Subsidiary or a Participant retires under any retirement plan of the Corporation or a Subsidiary, any then outstanding nonstatutory stock option or stock appreciation right held by such Participant shall be exercisable by the Participant (but only to the extent exercisable by the Participant immediately prior to the termination of employment) at any time prior to the expiration date of such nonstatutory stock option or stock appreciation right or within one year after the date of termination of employment, whichever is the shorter period;

(c) If the employment of a Participant who is a Disabled Participant is voluntarily terminated with the consent of the Corporation or a Subsidiary, any then outstanding stock option or stock appreciation right held by such Participant shall be exercisable in full (whether or not so exercisable by the Participant immediately prior to the termination of employment) by the Participant at any time prior to the expiration date of such stock option or stock appreciation right or within one year after the date of termination of employment, whichever is the shorter period;

(d) Following the death of a Participant during employment, any outstanding stock option or stock appreciation right held by the Participant at the time of death shall be exercisable in full (whether or not so exercisable by the Participant immediately prior to the death of the Participant) by the person entitled to do so under the will of the Participant, or, if the Participant shall fail to make testamentary disposition of the stock option or stock appreciation right or shall die intestate, by the legal representative of the Participant at any time prior to the expiration date of such stock option or stock appreciation right or within one year after the date of death, whichever is the shorter period;

(e) Following the death of a Participant after termination of employment during a period when a stock option or stock appreciation right is exercisable, any outstanding stock option or stock appreciation right held by the Participant at the time of death shall be exercisable by such person entitled to do so under the will of the Participant or by such legal representative (but only to the extent the stock option or stock appreciation right was exercisable by the Participant immediately prior to the death of the Participant) at any time prior to the expiration date of such stock option or stock appreciation right or within one year after the date of death, whichever is the shorter period; and

(f) Unless the exercise period of a stock option or stock appreciation right following termination of employment has been extended as provided in Section 11.3, if the employment of a Participant terminates for any reason other than voluntary termination with the consent of the Corporation or a Subsidiary, retirement under any retirement plan of the Corporation or a Subsidiary or death, all outstanding stock options and stock appreciation rights held by the Participant at the time of such termination of employment shall automatically terminate.

Whether termination of employment is a voluntary termination with the consent of the Corporation or a Subsidiary and whether a Participant is a Disabled Participant shall be determined in each case, in its sole discretion, by the Committee (or, in the case of Participants who are not (i) Covered Employees as of the end of the Corporation’s immediately preceding fiscal year or (ii) the Chief Executive Officer of the Corporation, by such Chief Executive Officer, in his sole discretion) and any such determination by the Committee or such Chief Executive Officer shall be final and binding. Without limitation of the foregoing, a termination of employment by the Participant shall not be a voluntary termination with the consent of the Corporation unless the Committee or, if applicable, such Chief Executive Officer, in its or his sole discretion, specifically consents to the termination of employment in writing.

~~5.9~~ ~~Other Terms and Conditions. Subject to~~Notwithstanding the foregoing provisions of this Section 54.3, the determination of Economic Value Added and the other provisions of the Plan, any stock option or stock appreciation right granted under the Plan may be exercised at such times and in such amounts and be subject to such restrictions and other terms and conditions, if any, as shall be determined, in its sole discretion, by the Committee and set forth in the agreement under Section 2.5.

~~SECTION 6~~

~~Restricted Stock~~

~~6.1~~ ~~Restricted Stock Awards; Certificates. Shares of restricted stock are actual shares of Common Stock issued~~amount otherwise allocable to a Participant and shall be evidenced in such manner as the Committee may deem appropriate, including book-entry registration or issuance of one or more stock certificates. Any certificate issued in respect of shares of restricted stock shall be registered in the name of the applicable Participant and, unless held by or on behalf of the Corporation in escrow or custody until the restrictions lapse or the shares are forfeited, shall bear an appropriate conspicuous legend referring to the terms, conditions, and restrictions applicable to such Award, substantially in the following form:

“The transferability of this certificate and the shares of stock represented hereby are subject to the terms and conditions (including forfeiture) of the Matthews International Corporation 2007 Equity Incentive Plan andfrom a ~~corresponding agreement. Copies of such Plan and agreement are on file at the offices of Matthews International Corporation, Two NorthShore Center, Pittsburgh, PA 15212-5851.”~~

The Committee may require that the certificates evidencing such shares be held in escrow or custody by or on behalf of the Corporation until the restrictions thereon shall have lapsed or the shares are forfeited and that, as a condition of any Award of restricted stock, the applicable Participant deliver to the Corporation a stock power, endorsed in blank, relating to the Common Stock covered by such Award.

~~6.2~~ ~~Terms and Conditions. Shares of restricted stock shall be subject to the following terms and conditions:~~

(a) The Committee shall, prior to or at the time of grant, condition the vesting of an Award of restricted stock upon (i) the continued service of the applicable Participant, (ii) the attainment of Performance Goals, or (iii) the attainment of Performance Goals and the continued service of the applicable Participant. The Committee shall establish at the time the restricted stock is granted the performance periods during which any Performance Goals specified by the Committee with respect to the restricted stock Award are to be measured. In the event that the Committee conditions the vesting of an Award of restricted stock upon the attainment of Performance Goals or the attainment of Performance Goals and the continued service of the applicable Participant, the Committee may, prior to or at the time of grant, designate an Award of restricted stock as a Qualified Performance-Based Award. The conditions for vesting and the other provisions of restricted stock Awards (including without limitation any applicable Performance Goals) need not be the same with respect to each recipient, and shall be established by the Committee in its sole discretion. Except in the case of a Qualified Performance-Based Award, the Committee at any time after the date of grant, in its sole discretion, may modify or waive any of the conditions applicable to an Award of restricted stock.

(b) Subject to the provisions of the Plan (including Section 6.3) and the applicable agreement under Section 2.5, during the period, if any, set by the Committee, commencing with the date of such restricted stock Award for which such vesting restrictions apply (the “Restriction Period”), and until the expiration of the Restriction Period, the Participant shall not be permitted to sell, assign, transfer, pledge or otherwise encumber shares of such restricted stock. A restricted stock Award may vest in part on a pro rata basis prior to the expiration of any Restriction Period.

(c) Except as provided in this Section 6 and in the applicable agreement under Section 2.5, the applicable Participant shall have, with respect to the shares of restricted stock, all of the rights of a shareholder of the Corporation holding the Common Stock that is the subject of the restricted stock, including, if applicable, the right to vote the shares and the right to receive any cash dividends. If so determined by the Committee and set forth in the applicable agreement under Section 2.5 and subject to Section 15.4, cash dividends on the Common Stock that is the subject of the restricted stock AwardBusiness Unit pool may be (i) automatically deferred and reinvested in additional restricted stock, and held subject to the same vesting and forfeiture conditions of the underlying restricted stock, or (ii) held by the Corporation in cash (without any payment of interest thereon) subject to the same vesting and forfeiture conditions of the restricted stock with respect to which the dividends are payable. Unless otherwise determined by the Committee and set forth in the applicable agreement under Section 2.5, any Common Stock or other securities payable with respect to any restricted stock as a result of or pursuant to Section 4.5, shall be held subject to the same vesting and forfeiture conditions of the underlying restricted stock.

(d) As soon as practicable after the applicable Restriction Period has ended, the Committee shall determine and certify (in writing in the case of Qualified Performance-Based Awards) whether and the extent to which the service period and/or the Performance Goals were met for the applicable restricted stock. If the vesting condition or conditions applicable to the restricted stock are not satisfied by the time the Restriction Period has expired, such restricted stock shall be forfeited. If and when the Restriction Period expires without a prior forfeiture of the shares of restricted stock (i) if legended certificates have been issued, unlegended certificates for such shares shall be delivered to the Participant upon surrender of the legended certificates, (ii) if legended certificates have not yet been issued, unlegended certificates (and any related blank stock powers previously executed by the Participant) shall be delivered to the Participant, and (iii) any cash dividends held by the Corporation pursuant to Section 6.2(c) shall be delivered to the Participant.

~~6.3~~ ~~Permitted Transfers~~. Neither this Section 6 nor any other provision of the Plan shall preclude a Participant from transferring or assigning restricted stock, without the payment of value or consideration to the Participant, to (i) the trustee of a trust that is revocable by such Participant alone, both at the time of the transfer or assignment and at all times thereafter prior to such Participant's death or (ii) the trustee of any other trust to the extent approved in advanceadjusted by the Committee, in its sole discretion, ~~in writing. A transfer or assignment of restricted stock from such trustee~~ to ~~any person other than such Participant shall be permitted only to~~take into account the ~~extent approved in advance by the Committee, in its sole discretion, in writing, and restricted stock held by such trustee shall be subject to all~~effect of the ~~conditions and restrictions set forth~~following: changes in ~~the Plan and in the applicable agreement under Section 2.5 as if such trustee were a party to such agreement.~~

~~SECTION 7~~

~~Restricted Stock Units~~

~~7.1~~ ~~Restricted Stock Unit Awards. Restricted stock units are Awards denominated in shares of Common Stock~~accounting standards that will be settled, subject to the terms and conditions of the restricted stock units and at the sole discretion of the Committee, in an amount in cash, shares of Common Stock, or both, based upon the Fair Market Value of a specified number of shares of Common Stock.

~~7.2Terms and Conditions. Restricted stock units shall be subject to the following terms and conditions:~~

(a) The Committee shall, prior to or at the time of grant, condition the vesting of restricted stock units upon (i) the continued service of the applicable Participant, (ii) the attainment of Performance Goals or (iii) the attainment of Performance Goals and the continued service of the applicable Participant. In the event that the Committee conditions the vesting of restricted stock units upon the attainment of Performance Goals or the attainment of Performance Goals and the continued service of the applicable Participant, the Committee may, prior to or at the time of grant, designate the restricted stock units as a Qualified Performance-Based Awards. The Committee shall determine the performance period(s) during which any Performance Goals are to be achieved. The conditions for grant or vesting and the other provisions of restricted stock units (including without limitation any applicable Performance Goals) need not be the same with respect to each recipient. An Award of restricted stock units shall be settled as and when the restricted stock units vest, as determined and certified (in writing in the case of Qualified Performance-Based Awards) by the Committee, or at a later time specified by the Committee or in accordance with an election of the Participant, if the Committee so permits. Except in the case of a Qualified Performance-Based Award, the Committee at any time after the date of grant, in its sole discretion, may modify or waive any of the conditions applicable to an Award of restricted stock units.

(b) Subject to the provisions of the Plan and the applicable agreement under Section 2.5, during the period, if any, set by the Committee, commencing with the date of grant of such restricted stock units for which such vesting restrictions apply (the “Units Restriction Period”), and until the expiration of the Units Restriction Period, the Participant shall not be permitted to sell, assign, transfer, pledge or otherwise encumber restricted stock units. A restricted stock unit may vest in part prior to the expiration of any Units Restriction Period.

(c) Participants granted restricted stock units shall not be entitled to any dividends payable on the Common Stock unless the agreement under Section 2.5 for restricted stock units specifies to what extent and on what terms and conditions the applicable Participant shall be entitled to receive current or deferred payments of cash, Common Stock or other property corresponding to the dividends payable on the Common Stock (subject to Section 15.4 below). Restricted stock units shall not have any voting rights, and holders of restricted stock units shall not be shareholders of the Corporation unless and until shares of Common Stock are issued by the Corporation (in book-entry form or otherwise).

~~SECTION 8~~

~~Performance Units~~

~~Performance units may be granted hereunder to eligible employees, for no cash consideration or for such minimum consideration as~~ may be required by the Financial Accounting Standards Board or, if applicable, ~~law, either alone~~the International Accounting Standards Board; extraordinary, unusual, non-recurring or infrequent items; acquisitions; divestitures; expenses for restructuring or productivity initiatives; new laws, cases or regulatory developments that result in ~~addition to~~unanticipated items of gain, loss, income or expense; the effect of corporate reorganizations or restructurings, spinoffs, or a sale of a Business Unit; and other ~~Awards granted under the Plan. The Committee shall establish at the time the performance unit is granted the performance period(s) during which any Performance Goals specified by~~items as the Committee ~~with respect to the Award are~~determines to be ~~measured. The Performance Goals to be achieved during any performance period(s) and~~required, so that the length of the performance period(s) shall be determined by the Committee upon the grant of each performance unit. The Committee may, in connection with the grant of performance units, designate them as Qualified Performance-Based Awards. The conditions for grant or vesting and the other provisions of performance units (including without limitation any applicable Performance Goals) need not be the same with respect to each Participant. Performance units may be paid in cash, shares of Common Stock, other property or any combination thereof, in the sole discretion of the Committee as set forth in the applicable agreement under Section 2.5. Performance units shall not have any voting rights, and holders of performance units shall not be shareholdersoperating results of the Corporation ~~unless and until shares of Common Stock are issued by the Corporation (in book-entry form~~ or ~~otherwise). The Performance Goals to be achieved for each performance period, whether the Performance Goals have been achieved, and the amount of the Award to be distributed~~any Business Unit shall be ~~conclusively determined~~computed on a comparative basis from Fiscal Year to Fiscal Year; in each case as those terms are interpreted under generally accepted accounting principles and ~~certified (in writing~~provided in each case that the ~~case~~effect of Qualified Performance-Based Awards) by the Committee. Performance units may be paid in a lump sum or in installments following the close of the performance period(s). The Participant shall not be permitted to sell, assign, transfer, pledge or otherwise encumber performance units. The maximum value of the property, including cash, that may be paid or distributed to any Participant pursuant to a grant of performance units made in any one calendar yearsuch items is objectively determinable. No such adjustment shall be ~~five million United States of America dollars ($5,000,000).~~

~~SECTION 9~~

~~Other Stock-Based Awards~~

The Committee may award Common Stock and other Awards that are valued in whole or in part by reference to, or are otherwise based upon, Common Stock, including but not limited to, unrestricted stock or dividend equivalents. Any such Award shall be subject to such terms and conditions as established by the Committee, and may include Qualified Performance-Based Awards. The maximum value of Common Stock and other property, including cash, that may be paid or distributed to any Participant pursuant to this Section 9 (and not pursuant to other sections of the Plan) in any one calendar year shall be five million United States of America dollars ($5,000,000).

~~SECTION 10~~

~~Issuance of Shares~~

~~The Committee may require each person purchasing or receiving shares of Common Stock pursuant~~made with respect to an Award to ~~represent~~a Covered Employee if it would cause the Award to ~~and agree with the Corporation in writing that such person is acquiring the shares without a view~~fail to ~~the distribution thereof. The certificates for such shares may include any legend which the Committee deems appropriate to reflect any restrictions on transfer. The obligation~~qualify as performance-based compensation under Section 162(m) of the Corporation to issue 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 Corporation, (ii) the condition that the shares shall have been listed (or authorized for listing upon official notice of issuance) upon each stock exchange, if any, on which the shares of Common Stock may then be listed, (iii) all other applicable laws, regulations, rules and orders which may then be in effect and (iv) obtaining any other consent, approval, or permit from any state or federal governmental agency which the Committee shall, in its sole discretion, determine to be necessary or advisable.

~~SECTION 11~~Code.

~~Additional Rights in Certain Events~~(d) Maximum Payment/Cap

~~11.1~~ ~~Definitions~~.

~~For purposes of this Section 11, the following terms shall have the following meaning:~~

~~(1) The term "Person" shall be used as that term is used in Section 13(d) and 14(d) of the 1934 Act.~~

~~(2) "Beneficial Ownership" shall be determined as provided in Rule 13d-3 under the 1934 Act as in effect on the effective date of the Plan.~~

~~(3) "Voting Shares" shall mean all securities of a Corporation entitling the holders thereof to vote in an annual election of Directors (without consideration of the rights of~~ Notwithstanding any ~~class of stock~~ other than the Common Stock to elect Directors by a separate class vote); and a specified percentage of "Voting Power" of a Corporation shall mean such number of the Voting Shares as shall enable the holders thereof to cast such percentage of all the votes which could be cast in an annual election of directors (without consideration of the rights of any class of stock other than the Common Stock to elect Directors by a separate class vote).

~~(4) "Section 11 Event" shall mean the date upon which any of the following events occurs:~~

(a) The Corporation acquires actual knowledge that any Person other than the Corporation, a Subsidiary or any employee benefit plan(s) sponsored by the Corporation has acquired the Beneficial Ownership, directly or indirectly, of securities of the Corporation entitling such Person to 20% or more of the Voting Power of the Corporation;

~~(b) At any time less than 60% of the members of the Board of Directors shall be individuals who were either (i) Directors on the effective date~~provision of the Plan, ~~or (ii) individuals whose election, or nomination for election, was approved by a vote (including a vote approving a merger or other agreement providing~~(i) the ~~membership of such individuals on the Board of Directors) of at least two-thirds of the Directors then still in office who were Directors on the effective date of the Plan or who were so approved;~~

~~(c) The shareholders of the Corporation shall approve an agreement or plan providing for the Corporation~~maximum amount which may be paid to ~~be merged, consolidated or otherwise combined with, or for all or substantially all its assets or stock~~any Covered Employee during any Fiscal Year pursuant to be acquired by, another corporation, as a consequence of which the former shareholders of the Corporation will own, immediately after such merger, consolidation, combination or acquisition, less than a majority of the Voting Power of such surviving or acquiring corporation or the parent thereof; or

(d) The shareholders of the Corporation shall approve any liquidation, sale or transfer of all or substantially all of the assets of the Corporation (other than to an entity or entities controlled by the Corporation and/or its shareholders following such event);

provided, however, that if securities beneficially owned by a Participant are included in determining the Beneficial Ownership of a Person referred to in paragraph 4(a), then no Section 11 Event with respect to such Participant shall be deemed to have occurred by reason of such event.

~~11.2~~ ~~Acceleration of the Exercise Date of Stock Options and Stock Appreciation Rights~~. Subject to the provisions of Section 5 in the case of incentive stock options and Section 11.6, unless the agreement under Section 2.5 shall otherwise provide, notwithstanding any other provision contained in the Plan, in case any Section 11 Event occurs all outstanding stock options and stock appreciation rights shall become immediately and fully exercisable whether or not otherwise exercisable by their terms.

~~11.3~~ ~~Extension of the Expiration Date of Stock Options and Stock Appreciation Rights~~. Subject to the provisions of Section 5 in the case of incentive stock options and Section 11.6, unless the agreement under Section 2.5 shall otherwise provide, notwithstanding any other provision contained in the Plan, all stock options and stock appreciation rights held by a Participant whose employment with the Corporation or a Subsidiary terminates within one year of any Section 11 Event for any reason other than voluntary termination with the consent of the Corporation or a Subsidiary, retirement under any retirement plan of the Corporation or a Subsidiary or death shall be exercisable for a period of three months from the date of such termination of employment, but in no event after the expiration date of the stock option or stock appreciation right.

~~11.4~~ ~~Lapse of Restrictions on Restricted Stock Awards~~. Unless the agreement under Section 2.5 shall otherwise provide, notwithstanding any other provision contained in the Plan other than Section 11.6, if any Section 11 Event occurs prior to the scheduled lapse of all restrictions applicable to restricted stock Awards under the Plan (including but not limited to ~~Qualified Performance-Based Awards)~~with respect to Deferred Credits and interest thereon) is five million United States of America dollars (US $5,000,000), ~~all such restrictions shall lapse~~and (ii) the Committee may provide that the amount otherwise allocable to a Participant from a Business Unit pool as an Allocable Award be capped at any amount determined by the Committee.

4.4Change of Control Events. Notwithstanding any other provision of the Plan, upon the occurrence of ~~any such~~a Section 11 Event ~~regardless~~(a) the Plan shall immediately terminate; (b) all Deferred Credits of active Participants and Former Active Participants will immediately become non-forfeitable without regard to the financial results of the ~~scheduled lapse~~current Fiscal Year or any following Fiscal Year; (c) the financial results of the current Fiscal Year to such ~~restrictions.~~date of termination shall be determined, the totals of the respective Business Unit pools for the current Fiscal Year shall be prorated based on such results, and each active Participant’s share of the current Fiscal Year’s prorated Allocable Award shall be determined by prorating such Participant’s individual goals for the current Fiscal Year; and (d) all such Deferred Credits and the current Fiscal Year prorated Allocable Award shall be paid to active Participants and Former Active Participants forthwith.

~~11.5~~ ~~Vesting~~4.5Payment of ~~Restricted Stock Units and Performance Units~~Allocable Share of Pool. ~~Unless~~

(a)

General.

(i) Payment of the ~~agreement under Section 2.5 shall otherwise provide, notwithstanding any other provision contained in~~Allocable Award following the ~~Plan other than Section 11.6, if any Section 11 Event occurs, all restricted stock units and performance units (including but not~~end of the Fiscal Year will be limited to ~~Qualified Performance-Based Awards) shall be considered~~an amount equal to be earned and payable in full, any vesting conditions shall be considered to have been satisfied, and such restricted stock units and performance units shall be settled in cash as promptly as is practicable.

~~11.6~~ ~~Code Section 409A. Notwithstanding the foregoing, if any Award is subject to Section 409A~~a multiple of the ~~Code, this Section 11 shall~~Participant’s target incentive used in determining Participant’s allocable share of the Business Unit pool and will be ~~applicable only~~made on such date determined by the Committee not later than March 15 of the calendar year following such Fiscal Year. Such multiple, which can be equal to, less than or greater than 1, will be determined by the ~~extent specifically provided in~~Committee at the ~~agreement under Section 2.5 applicable to the Award and permitted pursuant to Section 12.2.~~time of an Award.

6246

~~11.7~~ ~~Tax Gross-Up Payments. Unless~~(ii)Subject to Section 4.5(a)(iii), the ~~agreement under Section 2.5 shall otherwise provide,~~remainder of the Allocable Award (if any) will be assigned as Deferred Credits and paid in two equal installments following the close of the subsequent two Fiscal Years if the ~~independent auditors of the Corporation most recently selected by the Board determine that (i) any grant, payment or transfer to or for the benefit of a~~ Participant ~~(whether granted, paid or payable or transferred or transferable pursuant to~~is then either still employed and an active Participant in the Plan or ~~otherwise) (a “Payment”) would be deemed~~is a Former Active Participant, subject to ~~be an “excess parachute payment” for Federal income tax purposes because of Section 280G~~the following: If, in such subsequent two Fiscal Years, the amount of the ~~Code, or any successor provision (“Section 280G”)~~Business Unit pool to which the Deferred Credits are attributable is negative, (i) an active Participant with such Deferred Credits shall be a Participant in such negative Business Unit pool (even if the Participant is then participating in a different Business Unit pool from that in which the Deferred Credits assigned to such Fiscal Year arose), and (ii) ~~any Award, grant, payment or transfer under the Plan~~there will be a corresponding decrease in such active Participant’s Deferred Credits assigned to orsuch Fiscal Year. Further, for the ~~benefit~~sole purpose of allocating a current negative amount of a ~~Participant within one year of or following the occurrence of~~Business Unit pool incentive among Participants in such Business Unit pool, a Section 11 Event constitutes in whole or in part a “parachute payment” under Section 280G (without regard to Section 280G(b)(4)) used in calculating such “excess parachute payment,” the PaymentFormer Active Participant will be ~~grossed up through~~considered, for such two following Fiscal Years, a member of the ~~payment by the Corporation~~Business Unit pool in which such Participant participated immediately prior to termination of employment, so that, upon such a negative Allocable Award for a Former Active Participant in either or both of such two following Fiscal Years, there will be a corresponding decrease in such Former Active Participant’s Deferred Credits assigned to the Fiscal Year to which the current negative Business Unit pool relates. Although the Deferred Credits assigned to a particular following Fiscal Year can decrease to zero, they cannot be negative nor be applied to reduce Deferred Credits assigned to the following Fiscal Year. If, for any Fiscal Year, a Participant is a Participant in ~~cash of~~more than one Business Unit pool and a negative Allocable Award for the Participant results from a Business Unit pool, the negative Allocable Award from such Business Unit pool shall not be used to reduce a current Allocable Award or Deferred Credits from another Business Unit pool but only from the same Business Unit pool from which the negative Allocable Award results.

(iii) If the amount of any excise tax under Section 4999 of the Code, or any successor provision (“Section 4999”), on the “excess parachute payment” and the amount of any excise tax under Section 4999 and applicable income tax on the total amount of such gross up payment so that the Participant will receive the full amount of the Payment after the Participant has paid any excise tax under Section 4999 of the Code on the “excess parachute payment” and any excise tax under Section 4999 and applicable income tax on the amount of such gross up payment. On the later of the date an ~~“excess parachute payment” is paid to or for the benefit of the Participant or the date on which it can be first determined that a Payment would be deemed~~Allocable Award to be ~~an “excess parachute payment” (but~~credited in ~~any event no later than~~a future Fiscal Year is considered insubstantial by the Committee, then it may be distributed following the end of the ~~Participant’s taxable year next~~Fiscal Year in which it was earned, provided, however, that, in the case of a Covered Employee, such distribution is permitted under Section 162(m)(4)(C) of the Code and the regulations thereunder.

(b)Interest. Any credited amounts will earn interest at a rate set by the Committee (approximately equal to the rate earned by the Corporation on its cash investments) from the end of the Corporation’s Fiscal Year in which the amount is first credited or became an Allocable Award (including credited as a Deferred Credit) until the date of payment of the credited amount subject to the following exceptions:

(i) Any payment of an amount which is not attributable to a Deferred Credit and any amount payable under Section 4.5(a)(iii), in each case which is made within three months after the end of the Corporation’s Fiscal Year for which the amount was first credited or earned, shall not earn interest;

(ii) Any payment of an amount which is attributable to a Deferred Credit and is made within three months after the end of the Corporation’s Fiscal Year in which the amount was finally earned shall earn interest as follows:

A.Deferred Credits finally earned in the Fiscal Year immediately following the Fiscal Year for which the Deferred Credit was first credited shall earn interest for twelve (12) months; and

B.Deferred Credits finally earned in the second Fiscal Year following the Fiscal Year for which the Deferred Credit was first credited shall earn interest for twenty-four (24) months.

Interest earned under these provisions of the Plan shall be compounded on an annual basis.

(c)Proration; Forfeiture. Notwithstanding any other provision of the Plan, an employee who was not a Participant for the entire Fiscal Year with respect to any given Business Unit pool will be subject to the following proration:

In the event of (i) a new Participant during a Fiscal Year, (ii) a Participant whose participation is withdrawn (i.e., transferred from management incentive to sales incentive or on a lease of absence), (iii) the involuntary termination of employment (other than for cause) of a Participant with the Corporation or a Subsidiary, or death, or mutually agreed to termination of employment of a Participant with the Corporation or a Subsidiary, or (iv) similar circumstances deemed to be appropriate by the Committee, the Participant’s otherwise Allocable Award for the current Fiscal Year will be reduced pro-rata, based upon those weeks or partial weeks that the employee is a Participant in the Plan.

In the event of voluntary termination of employment with the Corporation or a Subsidiary (prior to payment of any Allocable Award), or involuntary termination of employment with the Corporation or a Subsidiary for cause (prior to payment of any Allocable Award), all Allocable Awards not yet paid (including Deferred Credits, if any) shall thereupon be forfeited. In determining the amount of an Award for a new Participant added in a Fiscal Year after Awards are generally made for that Fiscal Year, the Committee may make a reduction to take into account the portion of the Fiscal Year already elapsed, the performance achieved during such elapsed portion of the Fiscal Year, and such other considerations as the Committee may deem relevant.

(d)Section 162(m) of the Code. Notwithstanding any other provision of the Plan, if for any reason the Committee reasonably anticipates that, if payment of all or any portion of an Award were made when otherwise scheduled such payment would not be deductible due to Section 162(m) of the Code, such payment may, in the Committee’s sole discretion, be deferred until such date selected by the Committee in the recipient Participant’s first taxable year in which the ~~Participant remits~~Corporation reasonably anticipates, or should reasonably anticipate, the ~~taxes subject to~~payment could be made without the ~~gross up payment), the Corporation shall pay or distribute to or for the benefit~~deduction of ~~the Participant the gross up~~such payment ~~due to the Participant under this Section 11.7. Notwithstanding the foregoing, no amounts shall be payable under this Section 11.7 unless they are either exempt from~~being barred by the application of ~~or comply with, the requirements of Section 409A of the Code.~~

~~SECTION 12~~

~~Qualified Performance-Based Awards; Section 409A~~

~~12.1~~ ~~Qualified Performance-Based Awards~~.

(a) The provisions of this Plan are intended to ensure that all options and stock appreciation rights granted hereunder to any Participant who is or may be a Covered Employee in the tax year in which such option or stock appreciation right is expected to be deductible to the Corporation qualify for the exemption from the limitation on deductions imposed by Section 162(m) of the Code, ~~(the “Section 162(m) Exemption”), and~~provided, however, that all scheduled payments to such ~~Awards shall therefore~~Participant that could be ~~considered Qualified Performance-Based Awards~~delayed in accordance with Treasury Regulation §1.409A-2(b)(7)(i) and this ~~Plan~~Section 4.5(d) must also be delayed.

4.6.Establishment of Performance Goals. The Committee shall ~~be interpreted~~establish in writing the performance conditions and ~~operated consistent with that intention. When granting~~goals of all Awards, including but not limited to its determinations under Section 4.2, at the time the Awards are granted, and in the case of any ~~Award other than an option or stock appreciation right, the Committee may designate such Award as a Qualified Performance-Based Award, based upon a determination that (i) the recipient is or may be a~~ Covered Employee, ~~with respect to such Award, and (ii)~~no later than the ~~Committee wishes such Award to qualify for the Section 162(m) Exemption, and the terms~~earlier of ~~any such Award (and of the grant thereof) shall be consistent with such designation. Within 90~~(a) ninety (90) days after the commencement of athe period of service to which the performance conditions and goals relate, or (b) the date on which twenty-five percent (25%) of such period ~~or, if earlier, by~~of service has elapsed.

4.7.Certification of Satisfaction of Performance Goals. Prior to the ~~expiration~~cash payment of ~~25% of a performance period,~~any Allocable Award to any Covered Employee, the Committee ~~will designate one or more performance periods, determine the Participants for~~shall certify in writing that the performance ~~periods~~goals and ~~establish the Performance Goals for the performance periods.~~

(b) Each Qualified Performance-Based Award (other than an option or stock appreciation right) shall be earned, vested and/or payable (as applicable) upon certification in writing by the Committeeany other material terms of the achievement of one or more Performance Goals, together with the satisfaction of any other conditions, such as continued employment, as previously established by the Committee with respect to such Award.

~~(c) Notwithstanding any provision~~Award were in ~~the Plan or in any agreement under Section 2.5, to the extent that any such provision or action~~fact satisfied. Such certification may be evidenced through approved minutes of the Committee ~~would cause any Qualified Performance-Based Award not to qualify for~~meeting at which the ~~Section 162(m) Exemption, such provision or action shall be null and void as it relates to Covered Employees, to the extent permitted by law and deemed advisable by the Committee.~~

~~12.2~~ ~~Code Section 409A. It~~certification is the intention of the Corporation that no Award shall be “deferred compensation” subject to Section 409A of the Code, unless and to the extent that the Committee specifically determines otherwise as provided in the immediately following sentence, and the Plan and the terms and conditions of all Awards shall be interpreted accordingly. The terms and conditions governing any Awards that the Committee determines will be subject to Section 409A of the Code, including any rules for elective or mandatory deferral of the delivery of cash or shares of Common Stock pursuant thereto and any rules regarding treatment of such Awards in the event of a Section 11 Event, shall be set forth in the applicable agreement under Section 2.5, and shall comply in all respects with Section 409A of the Code.made.

SECTION 135

Effect of the Plan on the Rights of Employees and Employer

Neither the adoption or continuation of the Plan nor any action of the Board or the Committee pursuant to the Plan shall be deemed to give any employee any right to be granted any Award under the Plan. Nothing in the Plan, in any Award under the Plan or in any ~~agreement under Section 2.5 providing for any Award~~other document under the Plan shall be construed as a contract of employment between the Corporation or any Subsidiary and any employee or confer any right to any employee to continue in the employ of the Corporation or any Subsidiary or interfere in any way with the rights of the Corporation or any Subsidiary to terminate the employment of any employee at any time (with or without cause) or adjust the compensation of any employee at any time.

SECTION 146

Amendment or Termination

The right to amend the Plan at any time and from time to time and the right to terminate the Plan are hereby specifically reserved to the Board; provided that no such amendment of the Plan shall, without shareholder approval (a) increase the maximum aggregate number of shares of Common Stock for which Awards may be made under Section 4.1 of the Plan, (b) increase the maximum aggregate number of shares of Common Stock as to which incentive stock options may be granted under Section 4.1 of the Plan, (c) make any changes in the class of employees eligible to receive Awards under the Plan, ~~(d)~~(b) change the ~~maximum number~~business criteria of ~~shares~~Economic Value Added on which the performance goal of ~~Common Stock as to which Awards may be made to any Participant under Section 4.2 of the Plan, or~~an Award is based, (c) change the maximum amount that may be paid or distributed to any Participant ~~pursuant to a grant of performance units or other stock-based Awards made~~ in any one ~~calendar year under Section 8~~Fiscal Year pursuant to Awards, or 9 of the Plan, respectively, (e) change the exercise price or Base Price permitted under Section 5.3 of the Plan or the restrictions regarding repricing under Section 5.3 of the Plan,(f) be made if shareholder approval of the amendment is at the time required for Awards under the Plan to qualify for the exemption from Section 16(b) of the 1934 Act provided by Rule 16b-3 or by the rules of the NASDAQ National Market System or any stock exchange on which the Common Stock may then be listed or (g)(d) be made to the extent such approval is needed for ~~Qualified Performance-Based~~ Awards to Covered Employees to qualify for the exemption for performance-based compensation under Section 162(m) ~~Exemption.~~(4)(C) of the Code. No amendment or termination of the Plan shall, without the written consent of the holder of an Award under the Plan, adversely affect the rights of such holder with respect thereto.

6448

SECTION 7

~~SECTION 15~~General Provisions

~~General Provisions~~

7.1 ~~15.1~~ Additional Compensation Arrangements. Nothing contained in the Plan shall prevent the Corporation or any Subsidiary from adopting other or additional compensation arrangements for its employees.

~~15.2~~ 7.2 Tax Withholding. No later than the date as of which an amount first becomes includible in the gross income of a Participant for federal, state, local or foreign income or employment or other tax purposes with respect to any Award under the Plan, such Participant shall pay to the Corporation (or, if applicable, a Subsidiary), or make arrangements satisfactory to the Corporation (or, if applicable, a Subsidiary) regarding the payment of, any federal, state, local or foreign taxes of any kind required by law to be withheld with respect to such ~~amount. Unless otherwise determined by~~amount, provided, however, that the ~~Committee, withholding obligations~~Corporation (or, if applicable, a Subsidiary) may ~~be settled with Common Stock, including Common Stock that is part~~withhold any of ~~the Award that gives rise to the withholding requirement, having a Fair Market Value on the date of withholding equal to the minimum amount (and not~~such taxes from any ~~greater amount unless otherwise determined by the Committee) required~~payment to be ~~withheld for tax purposes, all in accordance~~made with ~~such procedures as~~respect to an Award under the ~~Committee establishes, and provided that any fractional share amount must be paid in cash or withheld from compensation otherwise due to the Participant.~~Plan. The obligations of the Corporation under the Plan shall be conditional on such payment or arrangements, and the Corporation and its Subsidiaries shall, to the extent permitted by law, have the right to deduct any such taxes from any payment otherwise due to such Participant. ~~The Committee may establish such procedures as it deems appropriate, including making irrevocable elections, for the settlement of withholding obligations with Common Stock.~~

~~15.3~~ 7.3 Limitation of Liability. The grant of any Award shall not:

(a) ~~give~~Give a Participant any rights except as expressly set forth in the ~~Plan or in the agreement under Section 2.5;~~Plan;

(b) ~~create~~Create any fiduciary or other obligation of the Corporation or any Subsidiary to take any action or provide to the Participant any assistance or dedicate or permit the use of any assets of the Corporation or any Subsidiary that would permit ~~the Participant~~Economic Value Added to be ~~able to attain any Performance Goals associated with any Award;~~attained;

(c) ~~create~~Create any trust, fiduciary or other duty or obligation of the Corporation or any Subsidiary to engage in any particular business, continue to engage in any particular business, engage in any particular business practices or sell any particular product or products; or

(d) ~~create~~Create any obligation of the Corporation or any Subsidiary that shall be greater than the obligation of the Corporation or that Subsidiary to any of their general unsecured creditors.

~~15.4~~ ~~Limitation on Dividend Reinvestment and Dividend Equivalents~~. Reinvestment of dividends in additional restricted stock at the time of any dividend payment, and the payment of shares with respect to dividends to Participants holding Awards of restricted stock units, shall only be permissible if authorized by the Committee and if sufficient shares of Common Stock are available under Section 4 for such reinvestment or payment (taking into account then outstanding Awards). In the event that sufficient shares of Common Stock are not available for such reinvestment or payment, such reinvestment or payment shall be made in the form of a grant of restricted stock units equal in number to the shares of Common Stock that would have been obtained by such payment or reinvestment, the terms of which restricted stock units shall provide for settlement in cash and for dividend equivalent reinvestment in further restricted stock units on the terms contemplated by this Section 15.4.

7.5 ~~15.5~~ Governing Law and Interpretation. To the extent not preempted by federal ~~Law,~~law, the Plan and all Awards made and actions taken thereunder shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania, without reference to principles of conflict of laws. The captions of this Plan are not part of the provisions hereof and shall have no force or effect.

~~15.6~~ 7.6 Dispute Resolution. Since Awards are granted in Western Pennsylvania, records relating to the Plan and Awards are located in Western Pennsylvania, and the Plan and Awards are administered in Western Pennsylvania, the Corporation and the Participant to whom an Award is granted, for themselves and their heirs, representatives, successors and assigns (collectively, the “Parties”) irrevocably submit to the exclusive and sole jurisdiction and venue of the state courts of Allegheny County, Pennsylvania and the federal courts of the Western District of Pennsylvania with respect to any and all disputes arising out of or relating to the Plan, the subject matter of the Plan or any Awards under the Plan, including but not limited to any disputes arising out of or relating to the interpretation and enforceability of any Awards or the terms and conditions of the Plan. To achieve certainty regarding the appropriate forum in which to prosecute and defend actions arising out of or relating to the Plan, and to ensure consistency in application and interpretation of the governing law under Section ~~15.5~~7.5 of the Plan, the Parties agree that (a) sole and exclusive appropriate venue for any such action shall be the Pennsylvania courts described in the immediately preceding sentence, and no other, (b) all claims with respect to any such action shall be heard and determined exclusively in such Pennsylvania courts, and no other, (c) such Pennsylvania courts shall have sole and exclusive jurisdiction over the Parties and over the subject matter of any dispute relating hereto and (d) the Parties waive any and all objections and defenses to bringing any such action before such Pennsylvania courts, including but not limited to those relating to lack of personal jurisdiction, improper venue or forum non conveniens.

~~15.7~~ 7.7 Non-Transferability. Except as otherwise specifically provided in the Plan or by the Committee ~~and limited~~a Participant shall not have the right to, adirectly or indirectly, alienate, assign, transfer, ~~without the payment~~pledge, anticipate or encumber (except by reason of ~~value~~death) any amount that is or ~~consideration~~may be payable to the Participant ~~Awards~~ under the Plan, ~~are not transferable except~~nor shall any such amount be subject to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment by ~~will~~creditors of a Participant or to the debts, contracts, liabilities, engagements, or torts of a Participant, or transfer by ~~laws~~operation of ~~descent and distribution~~law in the event of ~~the state~~bankruptcy or insolvency of ~~domicile of the~~a Participant, ~~at the time of death.~~or any legal process.

~~15.8~~ 7.8 Deferrals. ~~The Committee~~It is the intention of the Corporation that no Award shall be ~~authorized~~“deferred compensation” subject to Section 409A of the Code, unless and to the extent that the Committee specifically determines otherwise as provided in the immediately following sentence, and the Plan and the terms and conditions of all Awards shall be interpreted accordingly. If the Committee so determines in its sole discretion, the Committee may establish in writing procedures, terms and conditions pursuant to which the payment of any Award may be deferred, provided that any such deferral is consistent with all aspects of Section 409A of the Code. Subject to the provisions of this Plan and any agreement under Section 2.5, the recipient of an Award (including, without limitation, any deferred Award) may, if so determined by the Committee, be entitled to receive, currently or on a deferred basis, interest or dividends, or interest or dividend equivalents, with respect to the number of shares covered by the Award, as determined by the Committee, in its sole discretion, and the Committee may provide that such amounts (if any) shall be deemed to have been reinvested in additional shares or otherwise reinvested.Code

~~15.9~~ 7.9 Integration. The Plan ~~and any written agreements executed by Participants and the Corporation under Section 2.5 contain~~contains all of the understandings and representations between the ~~parties~~Corporation and ~~supersede~~its Subsidiaries and any of their employees and supersedes any prior understandings and agreements entered into between them regarding the subject matter within. There are no representations, agreements, arrangements or understandings, oral or written, between the ~~parties~~Corporation and its Subsidiaries and any of their employees relating to the subject matter of the Plan which are not fully expressed in the ~~Plan~~Plan. Notwithstanding the foregoing, the Corporation’s Management Incentive Program and Management Incentive Program – Covered Employees, previously adopted the ~~written agreements.~~Corporation and as amended from time to time, shall remain in effect as to awards previously made thereunder which remain in effect (including Deferred Credits thereunder).

~~15.10~~ 7.10 Foreign Employees and Foreign Law Considerations. The Committee may grant Awards to eligible employees who are foreign nationals, who are located outside the United States of America or who are not compensated from a payroll maintained in the United States of America, or who are otherwise subject to (or could cause the Corporation to be subject to) legal or regulatory provisions of countries or jurisdictions outside the United States of America, on such terms and conditions different from those specified in the Plan as may, in the judgment of the Committee, be necessary or desirable to foster and promote achievement of the purposes of the Plan, and, in furtherance of such purposes, the Committee may make such modifications, amendments, procedures, or subplans as may be necessary or advisable to comply with such legal or regulatory provisions.

7.11 Unsecured Creditor Status. Any amount payable under the Plan shall be established and maintained only on the books and records of the Corporation and no assets or funds of the Corporation, any Subsidiary or the Plan shall be removed from the claims of the Corporation’s general or judgment creditors or otherwise made available until such amounts are actually paid to a Participant as provided herein. The Plan constitutes a mere promise by the Corporation to make payments which may be earned under the Plan in the future. A Participant shall have the status of, and his rights to receive a payment of cash under the Plan shall be no greater than the rights of, a general unsecured creditor of the Corporation. The Corporation shall not be obligated under any circumstances to separately fund the financial obligations under the Plan apart from the Corporation’s assets.

7.12 Non-Uniform Determinations. The Committee’s determinations under the Plan (including without limitation its determinations of the employees to receive Awards, the form, amount and timing of such Awards, the terms and provisions of such Awards and the establishment of percentages applicable under Section 4.2) need not be uniform and may be made by it selectively among employees who receive, or are eligible to receive, Awards under the Plan, whether or not such persons are similarly situated.

SECTION 168

Effective Date ~~and Duration~~ of Plan

The effective date and date of adoption of the Plan shall be November 13, ~~2007,~~2008, the date of adoption of the Plan by the Board, provided, however, that any Award to a Covered Employee under the Plan shall be effective only if, in a separate vote, the Plan is approved by a majority of the votes cast at a meeting of shareholders duly called, convened and held on or prior to ~~November 12, 2008,~~the date on which any compensation is paid pursuant to such an Award, at which a quorum representing a majority of the outstanding voting stock of the Corporation is, either in person or by proxy, present and voting on the Plan. ~~No stock option or stock appreciation right granted under~~The material terms of the Plan ~~on or after November 13, 2007 may be exercised until after such approval and any restricted stock, restricted stock units, performance units or other Award awarded under~~(as defined in Section 162(m) of the ~~Plan~~Code) as applicable to Covered Employees shall be ~~forfeited~~subject to re-approval by the shareholders of the Corporation ~~on November 12, 2008~~no later than the first meeting of the shareholders to take place in 2014, if such approval ~~has~~is required by Section 162(m) of the Code at the time, such terms have not been ~~obtained on or prior to~~earlier modified and approved by the shareholders, and the Corporation intends that ~~date. No Award under~~ the Plan ~~may be~~continue to meet the requirements for “performance-based compensation” under Section 162(m) of the Code for Awards to Covered Employees made ~~subsequent to November 12, 2017.~~following the date of such meeting.

6751

Exhibit B

PROXY - MATTHEWS INTERNATIONAL CORPORATION

Notice of

ANNUAL MEETING OF SHAREHOLDERS

To be held February ~~21, 2008~~19, 2009

Sheraton Station Square Hotel

300 West Station Square Drive

Pittsburgh, PA

To Our Shareholders:

The Annual Meeting of the Shareholders of Matthews International Corporation will be held at 6:00 PM, Thursday, February ~~21, 2008~~19, 2009 at the Sheraton Station Square Hotel, 300 West Station Square Drive, Pittsburgh, Pennsylvania, for the purpose of considering and acting upon the proposals set forth on the reverse side of this form.

Shareholders of record at the close of business on December 31, ~~2007~~2008 will be entitled to vote at the Annual Meeting or any adjournments thereof.

I hereby appoint Joseph C. Bartolacci and Steven F. Nicola and each of them, with full power of substitution and revocation, proxies to vote all shares of Common Stock of Matthews International Corporation which I am entitled to vote at the Annual Meeting of Shareholders or any adjournment thereof, with the authority to vote as designated on the reverse side.

PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY

USING THE ENCLOSED PREPAID ENVELOPE

------------------------------------------------------------------------------

ANNUAL MEETING PROXY CARD

IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR THE LISTED PROPOSALS.

A. Proposals – The Board of Directors recommends a vote FOR all the nominees and FOR Proposals 2 and 3.

1. Election of Directors

FOR WITHHOLD

01 – William J. Stallkamp (1 year term) [ ] [ ]

02 – Joseph C. Bartolacci (3 year term) [ ] [ ]

03 – Katherine E. Dietze (3 year term) [ ] [ ]

04 – Glenn R. Mahone [ ] [ ]


	~~FOR~~	~~WITHHOLD~~
~~01 – Robert G. Neubert~~	~~[ ]~~	~~[ ]~~

~~02 – Martin Schlatter~~	~~[ ]~~	~~[ ]~~

~~03 – John D. Turner~~	~~[ ]~~	~~[ ]~~

2. To approve the adoption of the FOR AGAINST ABSTAIN

2008 Management Incentive Plan [ ] [ ] [ ]

		~~FOR~~	~~AGAINST~~	~~ABSTAIN~~
~~To approve the adoption of the 2007 Equity Incentive Plan~~		FOR AGAINST ABSTAIN 3. To ratify the appointment of [ ] [ ] [ ]	~~[ ]~~	~~[ ]~~

PricewaterhouseCoopers LLP as the

3.
independent registered public accounting

		~~FOR~~	~~AGAINST~~	~~ABSTAIN~~
~~To ratify the appointment of PricewaterhouseCoopers LLP as the independent registered public accounting~~ firm to audit the records of the Company for ~~the fiscal year ending September 30, 2008.~~		~~[ ]~~	~~[ ]~~	~~[ ]~~

the fiscal year ending September 30, 2009.

4. To transact such other business as may properly come before the meeting.

B. Change of Address – Please print new address below.

I plan to attend the meeting. [ ]

C. Authorized Signatures – Sign Here – This section must be completed for your instructions to be executed. – Date and Sign Below

Please sign exactly as name appears hereon. When shares are held by joint tenants, both should sign. When signing as an attorney, executor, administrator, trustee, or guardian, please give full title as such. If a corporation, please sign in full corporate name by President or other authorized officer. If a partnership, please sign in partnership name by authorized person.

Signature 1 – Please keep signature within the box

----------------------------------------------------

Signature 2 – Please keep signature within the box

----------------------------------------------------

Date (mm/dd/yyyy)

--/--/----

		Page
Proxy Statement		1
Outstanding Stock and Voting Rights		2
General Information Regarding Corporate Governance		3
	Board of Directors	3
	Board Composition	3
	Board Committees	3
	Executive Committee	4
	Nominating and Corporate Governance Committee	4
	Audit Committee	4
	Compensation Committee	5
	Meeting Attendance	5
	Compensation of Directors	5
	Director Compensation Table	6
	Access to Directors	7
Proposal 1 – Election of Directors		7
	Nominees	8
	Continuing Directors	9
Proposal 2 – Approval of the Adoption of the ~~2007 Equity~~2008 Management Incentive Plan		11
Proposal 3 – Selection of Independent Registered Public Accounting Firm		2318
Stock Ownership		2419
	Stock Ownership Guidelines	2520
Executive Compensation and Retirement Benefits		2621
	Compensation Committee Report	2621
	Compensation Discussion and Analysis	2621
	Annual Compensation of the Named Executive Officers	3430
	Summary Compensation Table	3430
	Grants of Plan-Based Awards Table	3631
	Outstanding Equity Awards at Fiscal Year-End Table	3733
	Option Exercises and Stock Vested Table	3834
	Retirement Benefits	3834
	Pension Benefits Table	3935
	Potential Payments Upon Termination or Change in Control	3935
Audit Committee Matters		4138
Relationship with Independent Registered Public Accounting Firm		4239
Certain Transactions		4339
Compliance with Section 16(a) of the Exchange Act 40		4340
Shareholder Proposals for the ~~2008~~2010 Annual Meeting		4440
Other Matters		4440
Exhibit A		4541

Name	Fees Earned or Paid in Cash (1)		Stock Awards (2) (4)		Option Awards (3) (4)		Non-Equity Incentive Plan Compensation		Change in Pension Value and Nonqualified Deferred Compensation Earnings		All Other Compensation (5)		Total
D.M. Kelly	$	75,000	$	15,252		-		-		-	$	83,333	$	173,585
G.R. Mahone		47,500		37,146	$	9,444		-		-		-		94,090
R.G. Neubert		47,000		15,252		-		-		-		-		62,252
J.P. O’Leary, Jr.		56,500		15,252		31,338		-		-		-		103,090
M. Schlatter		-		-		-		-		-		-		-
W.J. Stallkamp		63,000		37,146		9,444		-		-		-		109,590
J.D. Turner		57,500		37,146		9,444		-		-		-		104,090

Name	Fees Earned or Paid in Cash (1)	Stock Awards (2) (4)	Option Awards (3) (4)	Non-Equity Incentive Plan Compen-sation	Change in Pension Value and Nonqualified Deferred Compensation Earnings	All Other Compen-sation (5)	Total
W.J. Stallkamp	$119,000	$52,191	-	-	-	-	$171,191
D.J. DeCarlo	34,500	15,026	-	-	-	$157,500	207,026
K.E. Dietze	3,500	-	-	-	-	-	3,500
G.R. Mahone	53,000	52,191	-	-	-	-	105,191
R.G. Neubert	61,500	42,466	-	-	-	-	103,966
J.P. O’Leary, Jr.	52,500	42,466	$9,725	-	-	-	104,691
M. Schlatter	48,000	15,026	-	-	-	-	63,026
J.D. Turner	60,500	52,191	-	-	-	-	112,691

Nominees:	Term to expire at Annual Meeting of Shareholders in:

William J. Stallkamp	2010

Joseph C. Bartolacci	2012
Katherine E. Dietze	2012
Glenn R. Mahone	2012

Continuing Directors:

John P. O’Leary, Jr.	2010

Robert G. Neubert	2011
Martin Schlatter	2011
John D. Turner	2011

~~Continuing Directors~~:

~~Joseph C. Bartolacci~~	~~2009~~
~~Glenn R. Mahone~~	~~2009~~
~~William J. Stallkamp~~	~~2009~~

~~David J. DeCarlo~~	~~2010~~
~~John P. O’Leary, Jr.~~	~~2010~~

	~~1992 Stock Incentive Plan~~	~~1994 Director Fee Plan~~	~~Total~~
~~Stock Options~~
~~Outstanding shares~~	~~2,027,438 shares~~	~~21,300 shares~~	~~2,048,738 shares~~
~~Weighted-average exercise price~~ ~~exercise price~~	~~$33.56 per share~~	~~$35.05 per share~~	~~$33.57 per share~~
~~Average term to expiration~~	~~6.9 years~~	~~7.4 years~~	~~6.9 years~~

~~Full Value Awards (restricted shares only)~~
~~Outstanding unvested shares~~	~~141,574 shares~~	~~12,000 shares~~	~~153,574 shares~~

~~Shares available for grant~~	~~2,498,411 shares~~	~~185,518 shares~~	~~2,683,929 shares~~

1.	~~Net Income~~
2.	~~Economic Value Added (earnings less a capital charge)~~
3.	~~EBITDA (earnings before interest, taxes, depreciation and amortization)~~
4.	~~Sales~~
5.	~~Costs~~
6.	~~Gross Margin~~
7.	~~Operating Margin~~
8.	~~Pre-tax Profit or Income~~
9.	~~Market Share~~
~~10.~~	~~Return on Net Assets~~
~~11.~~	~~Return on Assets~~
~~12.~~	~~Return on Capital~~
~~13.~~	~~Return on Invested Capital~~
~~14.~~	~~Cash Flow~~
~~15.~~	~~Free Cash Flow~~
~~16.~~	~~Operating Cash Flow~~
~~17.~~	~~Operating Income~~
~~18.~~	~~EBIT (earnings before interest and taxes)~~
~~19.~~	~~Working Capital~~
~~20.~~	~~Innovation as measured by a percentage of sales from new products~~

1.	~~Stock Price~~
2.	~~Return on Shareholders’ Equity~~
3.	~~Earnings Per Share~~
4.	~~Cash Flow Per Share~~
5.	~~Total Shareholder Return (stock price appreciation plus dividends)~~

Name and Position	Dollar Value
J.C. Bartolacci	$600,000
S.F. Nicola	$239,400
J.P. Doyle	$154,050
P.F. Rahill	$80,000
F.J. Schwarz	N/A*

All Executive Officers as a Group	$1,355,530

All Employees other than Executive Officers as a Group	$1,080,000

Name of Beneficial Owner (1)	Number of Class A Shares Beneficially Owned (2)			Percent of Class			Deferred Stock Compensation Shares (7)
Directors, Officers and Executive Management:
D.M. Kelly		204,389	(3)(5)		0.7	%		-
J.C. Bartolacci		118,162	(3)(4)		0.4			-
D.J. DeCarlo		157,193	(3)		0.5			-
G.R. Mahone		9,556	(3)(5)		*			573
R.G. Neubert		3,166	(5)		*			-
S.F. Nicola		167,067	(3)(4)		0.5			-
J.P. O’Leary, Jr.		17,917	(3)(5)		0.1			17,970
P.F. Rahill		53,700	(3)(4)		0.2			-
M. Schlatter		-			-			-
F.J. Schwarz		-			-			-
W.J. Stallkamp		6,800	(3)(5)		*			15,096
J.D. Turner		10,100	(3)(5)		*			4,307
All directors, officers and executive management as a group (17 persons)		854,057	(3)(6)		2.7			37,946


Others:
Neuberger Berman, L.P. 605 Third Avenue New York, NY 10158		4,499,682			14.5
Ariel Capital Management, Inc. 200 East Randolph Drive, Suite 2900 Chicago, IL 60601		2,975,905	**		9.6
T. Rowe Price Associates, Inc. 100 East Pratt Street Baltimore, MD 21202		2,603,700			8.4

* Less than 0.1%
** Information as of September 30, 2007

		Pre-tax			Incentive
	Amount	Equivalent			Pool
	(000’s)				(000’s)
Adjusted FY 2007 consolidated net income	$69,991
Calculated FY 2007 cost of capital	(58,548)
FY 2007 economic value added	11,443	÷ 60%	X	1%	$191
Average economic value added for FY 2006 and FY 2007	9,081
Incremental economic value added	$2,362	÷ 60%	X	20%	787
					$978

Named Executive Officer	Target Incentive Award as a Percent of Base Salary
J.C. Bartolacci	100%
~~D.J. DeCarlo~~S.F. Nicola	70%
~~S.F. Nicola~~J.P. Doyle	~~60%~~50%
P.F. Rahill	~~35%~~40%
F.J. Schwarz	N/A*

Position	Minimum Equivalent Stock Value
Chief Executive Officer	5 times base salary
Chief Financial Officer; Group Presidents	4 times base salary
Division Presidents; Corporate Controller	3 times base salary
HR Director; Legal Counsel; Managers directly reporting to Division Presidents	2 times base salary
Other managers eligible for equity compensation and other MIP participants	1 time base salary

Name and Principal Position	Year (1)	Salary		Bonus (2)		Stock Awards		Option Awards (3)		Non-Equity Incentive Plan Compen-sation (4)		Change in Pension Value and Nonqualified Deferred Plan Compen-sation (5)		All Other Compen-sation (6)		Total
Joseph C. Bartolacci Director, President and Chief Executive Officer	2007	$	465,731		-		-	$	818,533	$	532,054	$	348,118	$	17,351	$	2,181,787
Steven F. Nicola Chief Financial Officer, Secretary and Treasurer	2007		285,469		-		-		518,394		243,603		75,557		13,672		1,136,695
David J. DeCarlo Director and Vice Chairman	2007		429,423		-		-		367,301		809,136		364,519		29,843		2,000,222
Paul F. Rahill President, Cremation Division	2007		179,896		-		-		94,022		171,336		11,057		8,171		464,482
Franz J. Schwarz (7) President, Graphics Europe	2007		305,704	$	153,729		-		32,484		-		-		14,143		506,060

Name	Year	Amount Paid Under Current Year’s Award	Deferred Credits Under Awards made in Prior Years, Earned in the Current Year’s Award	Earnings on Deferred Credits	Total
J.C. Bartolacci	2008 2007	$627,500 475,000	$57,730 49,159	$5,232 7,895	$690,462 532,054
S.F. Nicola	2008 2007	271,250 173,640	21,104 61,009	4,133 8,954	296,487 243,603
J.P. Doyle	2008	176,517	-	-	176,517
P.F. Rahill	2008 2007	95,400 63,595	134,097 100,232	11,652 7,509	241,149 171,336

		Estimated Future Payouts Under Non-Equity Incentive Plan Awards				Estimated Future Payouts Under Equity Incentive Plan Awards
Name	Grant Date (1)	Threshold ($)	Target ($) ( 2)		Maximum ($) (3)	Threshold (#)	Target (# ) (4)		Maximum (#)	All Other Stock Awards: Number of Shares of Stock or Units (#)		All Other Option Awards: Number of Securities Underlying Options (#)		Exercise or Base Price of Option Awards ($/Share) (5)		Grant Date Fair Value ($) (6)
J.C. Bartolacci	11/15/06							34,167			-		-	$	40.555	$	439,729
	11/15/06							34,167							40.555		466,038
	11/15/06							34,166							40.555		484,816
			$	475,000
S.F. Nicola	11/15/06							14,667			-		-		40.555		188,764
	11/15/06							14,667							40.555		200,058
	11/15/06							14,666							40.555		208,111
				173,640
D.J. DeCarlo	11/15/06							20,000			-		-		40.555		108,800
	11/15/06							20,000							40.555		131,800
	11/15/06							20,000							40.555		113,000
				303,800
P.F. Rahill	11/15/06							2,334			-		-		40.555		30,039
	11/15/06							2,333							40.555		31,822
	11/15/06							2,333							40.555		33,105
				63,595
F.J. Schwarz		NA	NA		NA			0			-		-	NA		NA

Name	Grant Date (1)	Estimated Future Payouts Under Non-Equity Incentive Plan Awards			Estimated Future Payouts Under Equity Incentive Plan Awards			All Other Stock Awards: Number of Shares of Stock or Units (#) (5)	All Other Option Awards: Number of Securities Underlying Options (#)	Exercise or Base Price of Option Awards ($/Share)	Grant Date Fair Value ($) (6)
Name	Grant Date (1)	Threshold ($)	Target ($) ( 2)	Maximum ($) (3)	Threshold (#)	Target (# ) (4)	Maximum (#)			Exercise or Base Price of Option Awards ($/Share)	Grant Date Fair Value ($) (6)
J.C. Bartolacci	12/05/07					5,800					$222,082
	12/05/07					5,800					190,936
	12/05/07					5,800					162,168
	12/05/07							17,400			764,556
	11/12/07		$502,000	$1,004,000
S.F. Nicola	11/12/07					2,417					92,740
	11/12/07					2,417					80,559
	11/12/07					2,416					68,904
	11/12/07							7,250			316,934
	11/12/07		217,000	434,000
J.P. Doyle	11/12/07					1,200					46,044
	11/12/07					1,200					39,996
	11/12/07					1,200					34,224
	11/12/07							3,600			157,374
	11/12/07		147,004	294,008
P.F. Rahill	11/12/07					550					21,104
	11/12/07					550					18,332
	11/12/07					550					15,686
	11/12/07							1,650			72,130
	11/12/07		76,320	152,640
F.J. Schwarz		NA	NA	NA		NA		NA		NA	NA

	Option Awards													Stock Awards
Name																						Option Awards							Stock Awards
Name	Number of Securities Underlying Unexercised Options (#) Exercisable		Number of Securities Underlying Unexercised Options (#) Unexercisable (1)				Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) (2)				Option Exercise Price		Option Expiration Date	No. of Shares or Units of Stock That Have Not Vested (#)		Market Value of Shares or Units of Stock That Have Not Vested ($)		Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)		Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)		Number of Securities Underlying Unexercised Options (#) Exercisable	Number of Securities Underlying Unexercised Options (#) Unexercisable (1)		Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) (2)		Option Exercise Price	Option Expiration Date	No. of Shares or Units of Stock That Have Not Vested (#) (3)	Market Value of Shares or Units of Stock That Have Not Vested ($) (4)	Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) (5)	Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (4)
J.C. Bartolacci															-		-		-		-	0	13,333	(6)	0		$28.58	12/15/2013
		0		13,333	(3	)		0			$	21.81	12/19/2012						-
		0		13,333	(4	)		13,333	(4	)	$	28.58	12/15/2013									0	16,667	(7)	16,666	(7)	$36.03	11/16/2014
		0		16,667	(5	)		33,333	(5	)	$	36.03	11/16/2014									0	53,334	(8)	26,666	(8)	$37.29	11/16/2015
		0		26,667	(6	)		53,333	(6	)	$	37.29	11/16/2015									0	34,167	(9)	68,333	(9)	$40.56	11/15/2016
		0		0				102,500	(7	)	$	40.56	11/15/2016																17,400	$882,876	11,600	$588,584
S.F. Nicola															-		-		-		-	17,500	0		0		$21.81	12/19/2012
		28,000		0				0			$	13.98	3/16/2009									26,667	13,333	(6)	0		$28.58	12/15/2013
		8,000		0				0			$	14.03	11/15/2010									14,000	14,000	(7)	14,000	(7)	$36.03	11/16/2014
		11,000		0				0			$	24.37	1/17/2012									0	36,667	(8)	18,333	(8)	$37.29	11/16/2015
		11,667		5,833	(3	)		0			$	21.81	12/19/2012									0	14,667	(9)	29,333	(9)	$40.56	11/15/2016
		13,334		13,333	(4	)		13,333	(4	)	$	28.58	12/15/2013																7,250	367,865	4,833	245,243
		0		14,000	(5	)		28,000	(5	)	$	36.03	11/16/2014
		0		18,333	(6	)		36,667	(6	)	$	37.29	11/16/2015
		0		0				44,000	(7	)	$	40.56	11/15/2016
D.J. DeCarlo															-		-		-		-
		0		33,333	(3	)		0			$	21.81	12/19/2012
		0		20,000	(4	)		20,000	(4	)	$	28.58	12/15/2013
		17,334		0				34,666	(8	)	$	36.03	11/16/2014
		26,667		0				53,333	(9	)	$	37.29	11/16/2015
J.P. Doyle																						0	6,667	(10)	13,333	(10)	$41.24	01/18/2017
		0		0				60,000	(10	)	$	40.56	11/15/2016																3,600	182,664	2,400	121,776
P.F. Rahill															-		-		-		-	0	3,333	(6)	0		$28.58	12/15/2013
		3,333		3,333	(3	)		0			$	21.81	12/19/2012									0	2,667	(7)	2,666	(7)	$36.03	11/16/2014
		3,334		3,333	(4	)		3,333	(4	)	$	28.58	12/15/2013									0	5,334	(8)	2,666	(8)	$37.29	11/16/2015
		0		2,667	(5	)		5,333	(5	)	$	36.03	11/16/2014									0	2,334	(9)	4,666	(9)	$40.56	11/15/2016
		0		2,667	(6	)		5,333	(6	)	$	37.29	11/16/2015																1,650	83,721	1,100	55,814
		0		0				7,000	(7	)	$	40.56	11/15/2016
F.J. Schwarz															-		-		-		-	0	6,667	(8)	3,333	(8)	$37.29	11/16/2015
		0		3,333	(6	)		6,667	(6	)	$	37.29	11/16/2015																-	-	-

Name	Plan Name	Number of Years Credited Service (#) (1)		Present Value of Accumulated Benefit ($) (2)		Payments During Last Fiscal Year ($)
J.C. Bartolacci	Matthews International Corporation Employees Retirement Plan		9	$	71,336		-
	Matthews International Corporation Supplemental Retirement Plan		10		484,507		-
S.F. Nicola	Matthews International Corporation Employees Retirement Plan		14		96,948		-
	Matthews International Corporation Supplemental Retirement Plan		15		304,717		-
D.J. DeCarlo	Matthews International Corporation Employees Retirement Plan		21		443,119		-
	Matthews International Corporation Supplemental Retirement Plan		22		3,176,593		-
P.F. Rahill	Matthews International Corporation Employees Retirement Plan		4		22,145
F.J. Schwarz (3)	Not Applicable	NA		NA		NA

Name	Plan Name	Number of Years Credited Service (#) (1)	Present Value of Accumulated Benefit ($) (2)	Payments During Last Fiscal Year ($)
J.C. Bartolacci	Matthews International Corporation Employees Retirement Plan	10	$ 71,218	-
	Matthews International Corporation Supplemental Retirement Plan	11	437,929	-
S.F. Nicola	Matthews International Corporation Employees Retirement Plan	15	97,484	-
	Matthews International Corporation Supplemental Retirement Plan	16	277,390	-
J.P. Doyle	Matthews International Corporation Employees Retirement Plan	1	8,643	-
P.F. Rahill	Matthews International Corporation Employees Retirement Plan	5	32,081	-
	Matthews International Corporation Supplemental Retirement Plan	10	13,214	-
F.J. Schwarz (3)	Not Applicable	NA	NA	NA

Named Executive	Executive Benefit and Payment upon Separation	Voluntary Termination Without Consent	Voluntary Termination With Consent (1) (3) (4)	Involuntary Termination Without Cause	Involuntary Termination With Cause	Death or Disability (2) (3) (4)	Retirement (1) (3) (4)	Change in Control (2) (5) (6)
J.C. Bartolacci	Stock Options	$0	$1,606,381	$0	$0	$2,906.384	$1,606,381	$2,906,384
	Performance-based Restricted Shares	0	0	0	0	0	0	588,584
	Time-based Restricted Shares	0	882,876	0	0	882,876	882,876	882,876
	Supplemental Retirement Plan	0	0	0	0	0	0	381,944

S.F. Nicola	Stock Options	0	1,144,274	0	0	1,895,711	1,144,274	1,895,711
	Performance-based Restricted Shares	0	0	0	0	0	0	245,243
	Time-based Restricted Shares	0	367,865	0	0	367,865	367,865	367,865
	Supplemental Retirement Plan	0	0	0	0	0	0	161,249

J.P. Doyle	Stock Options	0	63,337	0	0	190,000	63,337	190,000
	Performance-based Restricted Shares	0	0	0	0	0	0	121,776
	Time-based Restricted Shares	0	182,664	0	0	182,664	182,664	182,664
	Supplemental Retirement Plan	0	0	0	0	0	0	0

P.F. Rahill	Stock Options	0	208,662	0	0	331,286	208,662	331,286
	Performance-based Restricted Shares	0	0	0	0	0	0	55,814
	Time-based Restricted Shares	0	83,721	0	0	83,721	83,721	83,721
	Supplemental Retirement Plan	0	0	0	0	0	0	126,325

F.J. Schwarz	Stock Options	0	89,704	0	0	134,550	89,704	134,550
	Performance-based Restricted Shares	NA	NA	NA	NA	NA	NA	NA
	Time-based Restricted Shares	NA	NA	NA	NA	NA	NA	NA
	Supplemental Retirement Plan	NA	NA	NA	NA	NA	NA	NA
	Severance (7)	0	0	825,645	0	341,646	341,646	825,645

	2007		2006

Audit fees (includes audits and reviews of the
Company’s fiscal 2007 and 2006 financial statements)	$	788,768	$	770,064

Audit-related fees (primarily acquisition-related work, and
audits of the Company’s various employee benefit plans in fiscal 2006)		14,323		28,632

Tax fees		49,045		66,309

All other fees		-		-