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Exhibit 10.1
Second Amended and Restated
ICO, Inc.
2007 Equity Incentive Plan

ARTICLE 1
Objectives

This Second Amended and Restated ICO, Inc. 2007 Equity Incentive Plan (formerly
known as the ICO, Inc. 1998 Stock Option Plan) is intended to advance the
interests of the Company, its shareholders, and its subsidiaries by encouraging
and enabling selected key employees of the Company, upon whose judgment,
initiative and effort the Company is largely dependent for the successful
conduct of its business, to acquire and/or increase and retain a proprietary
interest in the Company by ownership of its stock.

ARTICLE 2
Definitions

2.1
For purposes of the Plan the following terms shall have the definition that is
attributed to them, unless another definition is clearly indicated by a
particular usage and context.

 
(a)
“Affiliates” means, except to the extent otherwise not permitted under Code
Section 424(f), any one or more corporations which are members of a
“parent-subsidiary controlled group” as such term is defined in Code
Section 1563(a)(1), except that “at least 50 percent” shall be substituted for
“at least 80 percent” each place it appears in Code Section 1563(a)(1).

 
(b)
“Award” means any form of award authorized and granted under the Plan, whether
singly or in combination, pursuant to such terms, conditions, restrictions
and/or limitations (if any) as the Committee may establish.  Awards granted
under the Plan may include:

(i)           Options; and
 
(ii)           Restricted Shares.
 
 
(c)
“Award Agreement” means an agreement between a Participant and ICO, Inc.
evidencing an Award.

 
(d)
“Change of Control” has the meaning ascribed to it in Section 10.3.

 
(e)
“Code” means the Internal Revenue Code of 1986, as amended.

 
(f)
“Committee” means the Compensation Committee, or such other committee comprised
solely of “non-employee directors,” as defined in Rule 16b-3(b)(3), as
designated by the

 
 
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Board of Directors, vested with authority for administration of the Plan by the
Board.  The Committee shall be comprised solely of two (2) or more outside
directors (within the meaning of the term “outside directors” as used in Code
Section 162(m) and applicable interpretive authority thereunder, and within the
meaning of “Nonemployee Director” as defined in Rule 16b-3, as currently in
effect or as hereinafter modified or amended).

 
(g)
The “Company” means ICO, Inc. and any Affiliate of ICO.

 
(h)
“Date of Exercise” means the date on which the Company has received a written
notice of exercise of an Option, in such form as is acceptable to the Company,
and full payment of the purchase price.

 
(i)
“Date of Grant” means the date when the grant of an Award is effective, which
shall be designated by the Committee at the time it makes an Award, and shall be
either the date when the Award is made or a date in the future specified by the
Committee.

 
(j)
“Effective Date” means January 25, 2007.

 
(k)
“Eligible Employee” means any individual employed by the Company who performs
services for the Company and is treated as an employee for federal income tax
purposes either in the U.S. or in another country where such individual is
employed  or is otherwise taxable.  Eligible Employees include individuals
employed by the Company and on foreign assignment or working for the Company in
a business unit that is located outside of such individual’s country of
citizenship.

 
(l)
The “Fair Market Value” of a Share on a specified date means the last sale price
reported on the NASDAQ Global Market™  (the “NASDAQ”) on the specified date, or
if Shares are no longer traded on the NASDAQ, the last sales price reported on
any other stock exchange or over-the-counter trading system on which Shares are
trading on the specified date.  If no sale has been made on a specified date,
then the Fair Market Value of the Shares on that date shall mean the last sales
price on the last preceding day on which any sales of Shares were made on the
NASDAQ or other applicable stock exchange or over-the-counter trading system.

 
(m)
“Incentive Stock Option” shall have the same meaning as given to that term by
Section 422 of the Code.

 
(n)
“Nonqualified Stock Option” means any Option granted under the Plan that is not
considered an Incentive Stock Option.

 
(o)
“Option” means the right to purchase a stated number of Shares at a specified
price.  An Option may be granted to an Eligible Employee subject to the terms of
this Plan, and such other conditions and restrictions as the Committee deems
appropriate.  Each Option shall

 
 
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be designated by the Committee to be either an Incentive Stock Option or a
Nonqualified Stock Option.

 
(p)
“Option Expiration Date” is the last day of the term of an Option, i.e. the last
date when an Option may be exercised.

 
(q)
“Option Price” means the purchase price per Share subject to an Option and shall
be fixed by the Committee, but shall not be less than 100% of the Fair Market
Value of a Share on the Date of Grant.

 
(r)
“Participant” means any Eligible Employee who is granted an Award under the
Plan.

 
(s)
“Performance Measures” has the meaning ascribed to it in Section 3.3.

 
(t)
“Performance Period” has the meaning ascribed to it in Section 3.3.

 
(u)
“Permanent Disability” means any medically determinable physical or mental
impairment rendering an individual unable to engage in any substantial gainful
activity, which disability can be expected to result in death or which has
lasted or can be expected to last for a continuous period of not less than 12
months.

 
(v)
“Plan” means this ICO, Inc. 2007 Equity Incentive Plan, which is a restatement
of the previously adopted Fourth Amended and Restated ICO, Inc. 1998 Stock
Option Plan.

 
(w)
“Restricted Period” has the meaning ascribed to it in Section 7.1.

 
(x)
An Award of “Restricted Shares” has the meaning ascribed to it in Section 7.1.

 
(y)
Rule 16b-3(b)(3) means Rule 16b-3 promulgated under the Securities Exchange Act
of 1934.

 
(z)
“Share” means one share of the common stock, no par value, of ICO, Inc.

 
(aa)
“Termination of Employment” means the cessation of a Participant’s relationship
as an employee of the Company for federal tax purposes in any jurisdiction where
the individual is subject to federal income taxes as an employee of the Company.

 
(bb)
“Vesting Period” means the continuous period of employment required for an Award
of Options or Restricted Shares to become fully earned and exercisable.

 
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ARTICLE 3
Administration

3.1
The Plan shall be administered by the Committee.  Actions shall be taken by a
majority of the Committee members.

3.2
Except as specifically limited by the provisions of the Plan, the Committee in
its discretion shall have the authority to:

 
(a)
determine which Eligible Employees shall be granted Awards;

 
(b)
determine the number of Shares which may be subject to each Award;

 
(c)
for any Award that is an Option, determine the Option Price and the Option
Expiration Date;

 
(d)
determine the term and Vesting Period, if any, applicable to each Award of
Options and Restricted Shares;

 
(e)
for any Award that is an Option, determine whether each such Option is an
Incentive Stock Option or Nonqualified Stock Option;

 
(f)
for each Award, designate the Date of Grant of the Award, which must be on or
after the date when a majority of the Committee members have specifically
approved the material terms of the Award, and which Date of Grant cannot be
retroactive;

 
(g)
interpret the provisions of the Plan and decide all questions of fact arising in
its application; and

 
(h)
prescribe such rules and procedures for Plan administration as from time to time
it may deem advisable.

3.3
An Award may be granted contingent upon the achievement of performance or other
objectives (“Performance Measures”) during a specified period (the “Performance
Period”).  Except as specifically limited by the provisions of the Plan, the
Committee in its discretion shall have the authority to determine the
Performance Period and Performance Measures, if any, applicable to an Award, and
the Performance Period and Performance Measures applicable to the Award shall be
set forth in the Award Agreement.  If an Award is subject to Performance
Measures, the number of Options that vest, or the number of Restricted Shares
earned, will be contingent on the degree to which the Performance Measures
established at the time of the initial Award are satisfied or achieved, in the
sole discretion of the Committee.  The Committee shall have the sole discretion
to revise the Performance Measures or Performance Period to reflect significant
events or changes that occurred during the Performance Period.

 
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3.4
Any action, decision, interpretation or determination by the Committee with
respect to the application or administration of this Plan shall be final and
binding upon all persons, and need not be uniform with respect to its
determination of recipients, amount, timing, form, terms or provisions of
Awards.

3.5
No member of the Committee shall be liable for any action or determination taken
or made in good faith with respect to the Plan or any Award granted hereunder,
and to the extent permitted by law, all members shall be indemnified by the
Company for any liability and expenses that may occur through any claim or cause
of action.

ARTICLE 4
Shares Subject to Plan

4.1
Number of Authorized Shares.  The Shares that may be made subject to Awards
granted under the Plan shall not exceed 1,960,000 Shares in the
aggregate.  Except as provided in Section 4.2 and to the extent permitted under
Rule 16b-3, upon lapse or termination of any Award for any reason without being
completely exercised, the Shares that were subject to such Award may again be
subject to other Awards.  The aggregate number of Shares which may be issued
under the Plan shall be subject to adjustment in the same manner as provided in
Article 10 hereof with respect to Shares subject to Awards then
outstanding.  Exercise of an Award in any manner shall result in a decrease in
the number of Shares which may thereafter be available, both for purposes of the
Plan and for sale to any one individual, by the number of Shares as to which the
Award is exercised.  Separate stock certificates may be, but are not required to
be, issued by the Company for those Shares acquired pursuant to the exercise of
an Incentive Stock Option, for those Shares acquired pursuant to the exercise
of  a Nonqualified Stock Option, or upon satisfaction of applicable Vesting
Period and/or Performance Measures under an Award of Restricted Shares.

4.2
Annual Grant Limitation.  The maximum number of Shares with respect to which
Awards (in any combination of Options and Restricted Shares) may be granted to
any Participant during each fiscal year of ICO, Inc. is 400,000 (subject to
adjustment in the same manner as provided in Article 10 hereof with respect to
Shares subject to Awards then outstanding).  The limitation set forth in the
preceding sentence shall be applied in a manner which will permit compensation
generated under the Plan to constitute “performance-based” compensation for
purposes of Code Section 162(m), including, without limitation, counting against
such maximum number of Shares, to the extent required under Code Section 162(m),
any Shares subject to Options that are canceled or repriced.

4.3
Term of Plan.  Subject to the terms and conditions of the Plan, the Committee
may, from time to time prior to January 25, 2017, grant Awards to Eligible
Employees on such terms and conditions as the Committee may determine.  More
than one Award may be granted to the same Eligible Employee.

 
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ARTICLE 5
Award Agreements

5.1
All Awards granted under the Plan shall be evidenced by a written Award
Agreement in such form or forms as the Committee in its sole discretion may
determine.

5.2
Each Participant, by acceptance of an Award under this Plan, shall be deemed to
have consented to be bound, on the Participant’s own behalf and on behalf of the
Participant’s heirs, assigns and legal representatives, by all terms and
conditions of this Plan, as amended from time to time.

ARTICLE 6
Stock Option Awards

6.1
Option Expiration Dates.  Subject to specific provisions relating to Incentive
Stock Options set forth in Section 6.5 below, and subject to the provisions
regarding Termination of Awards in Article 9 below, each Option shall be for a
term of from one to ten years from the Date of Grant.  In the event that the
Option Expiration Date is not specified in the Option Award Agreement, it shall
be ten years from the Date of Grant.

6.2
Revisions to Option Awards.  The Committee, subject to the Participant’s
approval, on or after the Date of Grant, may establish different exercise
schedules and impose other conditions upon exercise and vesting for any
particular Option or groups of Options.  In addition, the Committee may, at any
time subject to the Participant’s approval, reclassify an Incentive Stock Option
as a Nonqualified Stock Option.

6.3
Exercise of Options.  Any person entitled to exercise an Option in whole or in
part may do so by delivering a written notice of exercise to the Company,
attention Corporate Secretary, at its principal office.  The written notice
shall specify the number of Shares for which an Option is being exercised and
the Date of Grant of the Option being exercised, and shall be accompanied by
full payment of the Option Price for the Shares being purchased.

6.4           Payment of Option Price.

 
(a)
Payment of the Option Price may be made in cash, by the tender of Shares, or
both, or in such other form as may be determined by the Committee.  Shares
tendered for payment of the Option Price shall be valued at their Fair Market
Value on the Date of Exercise.

 
(b)
Payment through tender of Shares may be made by instruction from the Participant
to the Company to withhold from the Shares issuable upon exercise that number
which have a Fair Market Value equal to the exercise price for the Option or
portion thereof being exercised.

 
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6.5           Designation as Incentive Stock Options or Nonqualified Stock
Options

 
(a)
The Committee in its discretion may designate whether an Option is to be
considered an Incentive Stock Option or a Nonqualified Stock Option.  The
Committee may grant both an Incentive Stock Option and a Nonqualified Stock
Option to the same individual.  However, where both an Incentive Stock Option
and a Nonqualified Stock Option are awarded at one time, such Options shall be
deemed to have been awarded in separate grants, shall be clearly identified, and
in no event will the exercise of one such Option affect the right to exercise
the other such Option.

 
(b)
Any Option designated by the Committee as an Incentive Stock Option will be
subject to the general provisions applicable to all Options granted under the
Plan.  In addition, the Incentive Stock Option shall be subject to the following
specific provisions:

 
(1)
At the time the Incentive Stock Option is granted, if the Eligible Employee
owns, directly or indirectly, stock representing more than 10% of (i) the total
combined voting power of all classes of stock of the Company, or (ii) a
corporation that owns 50% or more of the total combined voting power of all
classes of stock of the Company, then:

 
(i)
the Option Price must equal at least 110% of the Fair Market value of the Shares
on the Date of Grant, and

 
(ii)
the term of the Option shall not be greater than five years from Date of Grant.

 
(2)
The aggregate Fair Market Value of Shares (determined at the Date of Grant) with
respect to which Incentive Stock Options are exercisable by a Participant for
the first time during any calendar year under this Plan or any other plan
maintained by the Company shall not exceed $100,000.

 
(c)
If any Option is not granted, exercised, or held pursuant to the provisions
noted immediately above, it will be considered a Nonqualified Stock Option to
the extent that the Award is in conflict with these restrictions.

ARTICLE 7
Restricted Share Awards

7.1
“Restricted Shares” are Awards consisting of grants of Shares to Participants,
the vesting of which are subject to a Vesting Period and/or Performance Measures
established by the Committee.  The period when any Restricted Shares have not
yet been earned because the Vesting Period and/or Performance Measures have not
been satisfied is referred to herein as the “Restricted Period.”

 
 
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7.2
The Committee shall designate the Participants to whom Restricted Shares are to
be awarded and the number of Shares that are subject to the Award.

 
7.3
Grants of Restricted Shares awarded to Participants under the Plan shall be
subject to the following terms and conditions and to such other terms and
conditions, not inconsistent with the Plan, as shall be prescribed by the
Committee in its sole discretion and as shall be contained in the Award
Agreement:

 
 
(a)
Restricted Shares awarded to Participants may not be sold, assigned,
transferred, pledged or otherwise encumbered, except as provided otherwise
herein, for a Restricted Period of ten (10) years or such shorter period as the
Committee may determine at the time of the Award of such Restricted
Shares.  Under no circumstances shall the Restricted Period be less than one (1)
year (“Minimum Restricted Period”); provided, however, that the vesting of any
Restricted Shares may be accelerated to occur prior to the end of the Minimum
Restricted Period pursuant to the provisions of Section 9.2 or Section 10.3
below

 
 
(b)
Except for the restrictions described in the preceding paragraph, and as
otherwise provided in an Award Agreement, during the Restricted Period the
Participant as holder of such Restricted Shares shall have all the rights of a
stockholder, including but not limited to:

 
 
i.
the right to vote such Restricted Shares, and

 
 
ii.
the right to receive all dividends paid on such Restricted Shares.

 
 
(c)
The Committee may, subject to the Participant’s approval, at any time after the
date of an Award of Restricted Shares, adjust the length of any applicable
Vesting Period or Performance Period to account for individual circumstances of
a Participant or group of Participants, provided that the Restricted Period may
not be less than the Minimum Restricted Period.

 
 
(d)
Each certificate issued in respect of Restricted Shares awarded under the Plan
shall be registered in the name of the Participant and, at the discretion of the
Committee, until the conclusion of the Restricted Period each such certificate
may be deposited in a bank or alternative location designated by the
Committee.  Each such certificate shall bear the following (or a similar)
legend:

 
“The transferability of this certificate and the shares of stock represented
hereby are subject to the terms and conditions (including forfeiture) contained
in the ICO, Inc. 2007 Equity Incentive Plan and an agreement entered into
between the registered stockholder and ICO, Inc.  A copy of such plan and
agreement is on file in the office of the Secretary of ICO, Inc., 1811 Bering
Drive, Suite 200, Houston, Texas 77057 [or current ICO, Inc. address].”
 

 
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(e)
At the end of the Vesting Period applicable to a Restricted Share Award (that is
not subject to Performance Measures), such Restricted Shares will be transferred
free of all restrictions to a Participant (or the Participant’s successors).  At
the end of the Performance Period applicable to a Restricted Share Award: the
Committee shall determine the number of Restricted Shares that have been earned
in accordance with the provisions of Section 3.3 above; provided that the
Vesting Period, if any, has been satisfied, such Restricted Shares will be
transferred free of all restrictions to the Participant (or the Participant’s
successors); and any such Restricted Shares that are not earned because of
failure to satisfy applicable Performance Measures shall be forfeited.

 
7.4
Substitution of Cash.  If provided for in the applicable Award Agreement, the
Committee may, in its discretion, substitute cash equal to the Fair Market Value
(determined as of the date of distribution) of Restricted Shares otherwise
required to be distributed to a Participant.

 

 
ARTICLE 8
Transferability of Awards

During the lifetime of a Participant to whom an Award of Options or Restricted
Shares has been granted, such Options or Restricted Shares are not transferable
voluntarily or by operation of law, and may be exercised only by the designated
Participant.  Upon the death of a Participant to whom an Award of Options or
Restricted Shares has been granted, the Options or Restricted Shares may be
transferred to the beneficiaries or heirs of the deceased Participant by will or
by the laws of descent and distribution.  In addition, to the extent permitted
in an Award Agreement, the Committee may, in its discretion, allow for the
transferability of any Nonqualified Stock Options or Restricted Shares granted
pursuant to this Plan.

ARTICLE 9
Termination of Awards

9.1
Termination During Period of Continuous Employment.  During a Participant’s
period of continuous employment with the Company, an Award of Options or
Restricted Shares will be terminated only if it (a) has been fully exercised or
earned, (b) has not vested due to failure to satisfy any Performance Measures or
other terms of grant, or (c) has expired or been forfeited by its terms.

9.2           Termination of Employment.

 
(a)
Options.

 
(1)
Unless an Option Award Agreement provides otherwise, upon Termination of
Employment for any reason, the then exercisable portion of any Option will
terminate upon the earlier of (i) the first business day following expiration of
the

 
 
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three month period after the date of Termination of Employment, or (ii) the
Option Expiration Date set forth in the Award Agreement pursuant to which the
Option was granted.  The portion of any Option Award not exercisable will
terminate on the date of Termination of Employment.  For purposes of the Plan, a
leave of absence approved by the Company shall not be deemed to be Termination
of Employment.

 
(2)
Notwithstanding the preceding paragraph, if a Participant holding an Option dies
or becomes subject to Permanent Disability while employed or within three months
after Termination of Employment, such Option may be exercised, to the extent
exercisable on the date of the occurrence of the event which triggers the
operation of this paragraph, at any time by the estate or guardian of such
person or by those persons to whom the Option may have been transferred by will
or by the laws of descent and distribution until the earlier of (i) the date
which is one year after the date of such death or occurrence of Permanent
Disability, or (ii) the Option Expiration Date set forth in the Award Agreement.

 
(3)
The Committee may at any time prior to three months after the date of
Termination of Employment provide that particular Options not be affected by
such termination and continue in force whether or not exercisable at the date of
such Termination of Employment until the Option Expiration Date set forth in the
Award Agreement or any date prior thereto.

 
(4)
Except as provided in Article 10 hereof, in no event will the continuation of
the term of an Option beyond the date of Termination of Employment allow the
Participant, or the Participant’s beneficiaries or heirs, to accrue additional
rights under the Plan, or to purchase more Shares through the exercise of an
Option that  could have been purchased on the day that employment was
terminated.  In addition, notwithstanding anything contained herein, no Option
may be exercised in any event after the expiration of ten years from the Date of
Grant of such Option.

 
(b)
Restricted Shares.  Except as otherwise determined by the Committee in its sole
discretion, a Participant whose employment with the Company terminates prior to
the end of the Vesting Period applicable to a Restricted Share Award for any
reason shall forfeit all Restricted Shares remaining subject to such outstanding
Restricted Share Award.

 
(c)
Termination Due to Death or Permanent Disability – Awards Subject to Performance
Measures. In the event that the employment with the Company of a Participant
with Options or Restricted Shares conditioned on Performance Measures terminates
because of death or because the Participant becomes subject to Permanent
Disability, and the Performance Period has not ended at the time of such
termination due to death or Permanent Disability, the Committee shall have sole
discretion to determine whether all

 
 
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or any portion of the Award that is subject to Performance Measures will be
deemed earned.

ARTICLE 10
Adjustments to Awards due to Changed Circumstances

10.1
In the event of changes in the outstanding common stock of the Company as a
result of stock dividends, split-ups, recapitalizations, combinations of Shares,
exchanges of Shares or related transactions, the number and class of Shares and
price per Share for each outstanding award of Options or Restricted Shares shall
be correspondingly adjusted by the Committee.

10.2
The Committee shall make appropriate adjustments in the Option Price of any
outstanding award of Options to reflect any spin-off of assets, extraordinary
dividends or other distributions to shareholders.

10.3
In event that the Company shall, pursuant to action by its Board of Directors,
at any time propose to merge into, consolidate with, or sell or transfer
substantially all of its assets, or otherwise enter in to a transaction pursuant
to which ICO, Inc. is not the surviving corporation (other than a corporate
restructuring among Company Affiliates), or in which the outstanding Shares of
ICO, Inc. are converted to cash, other securities or other property (any such
circumstances referred to  herein as a “Change of Control”) and provision is not
made pursuant to the terms of the transaction(s) relating to such Change of
Control (the “Transaction”) for the assumption by the surviving, resulting or
acquiring corporation of any outstanding category of Awards under the Plan, or
for the substitution of new Awards therefor, with regard for Awards for which no
provision is made the following shall apply:

 
(a)
Options.  The Committee shall cause written notice of the proposed Transaction
to be given to each Option holder not more than twenty (20) days prior to the
anticipated effective date of the proposed Transaction, and the Participant’s
Option, unless otherwise provided for under the terms of the Option Award
Agreement, shall become fully (100%) vested and, prior to a date specified in
such notice, which shall not be more than ten days prior to the anticipated
effective date of the proposed Transaction, each Participant shall have the
right to exercise his or her Option to purchase any or all Shares then subject
to such Option (unless otherwise provided under the terms of the Option Award
Agreement), including those, if any, which by reason of other provisions of the
Plan have not then become available for purchase.  Each Participant, by so
notifying the Company in writing, may, in exercising his or her Option,
condition such exercise upon, and provide that such exercise shall become
effective at the time of, but immediately prior to, the consummation of the
Transaction, in which event such Participant need not make payment for the
Shares to be purchased upon exercise of such Option until five days after
written notice by the Company to such Participant that the Transaction has been
consummated.  If the transaction is consummated, each Option, to the extent not
previously exercised prior to the date specified in the foregoing notice, shall
terminate on the effective date of the

 
 
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Transaction.  If the Transaction is abandoned, (i) any Shares not purchased upon
exercise of such Option shall continue to be available for purchase in
accordance with the other provisions of the Plan and (ii) to the extent that any
Option not exercised prior to such abandonment shall have vested solely by
operation of this paragraph, such vesting shall be deemed annulled, and the
original vesting schedule set forth shall be reinstituted, as of the date of
such abandonment.

 
(b)
Restricted Shares.  The Committee shall cause written notice of the proposed
Transaction to be given to each Participant holding Restricted Shares not more
than twenty (20) days prior to the anticipated effective date of the proposed
Transaction, and unless provided for under the terms of the Restricted Share
Award Agreement, all restrictions imposed on Restricted Shares shall lapse and
such Restricted Shares shall become fully (100%) vested as of a date specified
in the notice, which shall not be more than ten (10) days prior to the
anticipated effective date of the proposed Transaction.

ARTICLE 11
Amendment or Discontinuance of Plan

11.1
The Board of Directors may at any time amend, suspend, or discontinue the Plan;
provided, however, that except as otherwise permitted by Rule 16b-3, Code
Section 162(m) or Code Section 422, no amendments by the Board of Directors
shall, without further approval of the shareholders of ICO, Inc.:

 
(a)
change the class of Eligible Employees;

 
(b)
except as provided in Articles 4 and 9 hereof, increase the number of Shares
which may be subject to Award granted under the Plan; or

 
(c)
cause the Plan or any Award granted under the Plan to fail to (i) qualify for
exemption from Section 16(b) of the Act, (ii) be excluded from the $1 million
deduction limitation imposed by Code Section 162(m), or (iii) qualify as an
“Incentive Stock Option” as defined by Code Section 422.

11.2
No amendment or discontinuance of the Plan shall alter or impair any Option
granted under the Plan without the consent of the holder thereof.

ARTICLE 12
Effective Date

The Plan became effective on January 12, 1998, having been adopted by the Board
of Directors on that date and approved by the shareholders of the Company within
twelve (12) months thereafter.  The Plan was amended and restated by the Board
of Directors on December 18, 2001, and approved by the
 
 
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shareholders of the Company on March 15, 2002.  The Plan was amended and
restated by the Board of Directors on January 27, 2004, and approved by the
shareholders of the Company on March 5, 2004.  The Plan was amended by the Board
of Directors on September 8, 2005 and was amended and restated by the Board of
Directors on November 16, 2005 (without the necessity of shareholder approval
for such amendments).  The Plan was amended and restated by the Board of
Directors on January 26, 2006, and approved by the shareholders of the Company
on March 14, 2006.  The Plan was amended and restated by the Board of Directors
on January 25, 2007, and approved by the shareholders of the Company on March 5,
2007.  The Plan was amended and restated by the Board of Directors on August 7,
2007 (without the necessity of shareholder approval for such amendments).  The
Plan was amended and restated by the Board of Directors on December 5, 2007
(without the necessity of shareholder approval for such amendments).

ARTICLE 13
Miscellaneous

13.1
Nothing contained in this Plan or in any action taken by the Board of Directors
or shareholders of the Company shall constitute the granting of an Award, and an
Award shall not be deemed granted unless: a written Award Agreement has been
delivered to the respective employee; the employee has executed the Award
Agreement respecting the Award in conformance with the provisions of the Plan
and the terms of grant; and the Award Agreement has been executed on behalf of
the Company.

13.2
Nothing contained in this Plan or in any Award granted pursuant to it shall
confer upon any employee any right to continue in the employ of the Company or
to interfere in any way with the right of the Company to terminate employment at
any time.  So long as a holder of an Award shall continue to be an employee of
the Company, the Award shall not be affected by any change of the Participant’s
duties or position.

13.3
Certificates for Shares purchased through exercise of Options or received due to
an award of Restricted Shares will be issued in regular course after exercise of
the Option and payment therefor as called for by the terms of the Option, or the
vesting and/or performance terms of the award of Restricted Shares.  No persons
holding an Option granted under this Plan shall have any rights or privileges of
a shareholder of the Company with respect to any Shares issuable upon exercise
of such Option until certificates representing such Shares shall have been
issued and delivered.  No Shares shall be issued and delivered upon exercise of
an Option unless and until the Company, in the opinion of its counsel, has
complied with all applicable registration requirements of the Securities Act of
1933 and any applicable state securities laws, and with any applicable listing
requirements of any national securities exchange on which ICO, Inc.’s securities
may then be listed as well as any other requirements of law.

13.4
This Plan shall continue in effect until the expiration of all Awards granted
under the Plan unless terminated earlier in accordance with Article 11;
provided, however, that it shall otherwise terminate ten years after the
Effective Date.

 
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13.5
Notwithstanding any provision in this Plan or in any Award Agreement, no
Restricted Share Award granted after the Effective Date of this amendment and
restatement of the Plan shall be exercisable prior to the date the ICO, Inc.
2007 Equity Incentive Plan (amending and restating the Fourth Amended and
Restated ICO, Inc. 1998 Stock Option Plan) is approved by the shareholders of
the Company (“Date of Shareholder Approval”).  In the event that any Options are
granted after the Effective Date, such Options may only be exercisable prior to
the Date of Shareholder Approval if, as of the Date of Grant of such Options,
the total number of Options subject to awards under the Plan does not exceed the
limit of Shares available for grant under the Plan as set forth in the Fourth
Amended and Restated ICO, Inc. 1998 Stock Option Plan.

 
 
 
 
 
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