Exhibit 10.1

NORANDA ALUMINUM HOLDING CORPORATION

2010 INCENTIVE AWARD PLAN

ARTICLE 1

PURPOSE

The purpose of the Noranda Aluminum Holding Corporation 2010 Incentive Award
Plan (the “Plan”) is to promote the success and enhance the value of Noranda
Aluminum Holding Corporation (the “Company”) by linking the personal interests
of the members of the Board, Employees, and Consultants to those of Company
stockholders and by providing such individuals with an incentive for outstanding
performance to generate superior returns to Company stockholders. The Plan is
further intended to provide flexibility to the Company in its ability to
motivate, attract, and retain the services of members of the Board, Employees,
and Consultants upon whose judgment, interest, and special effort the successful
conduct of the Company’s operation is largely dependent.

ARTICLE 2

DEFINITIONS AND CONSTRUCTION

Wherever the following terms are used in the Plan they shall have the meanings
specified below, unless the context clearly indicates otherwise. The singular
pronoun shall include the plural where the context so indicates.

2.1 “Administrator” shall mean the entity that conducts the general
administration of the Plan as provided in Article 11. With reference to the
duties of the Committee under the Plan which have been delegated to one or more
persons pursuant to Section 11.6, or as to which the Board has assumed, the term
“Administrator” shall refer to such person(s) unless the Committee or the Board
has revoked such delegation or the Board has terminated the assumption of such
duties.

2.2 “Award” shall mean an Option, a Restricted Stock award, a Restricted Stock
Unit award, a Performance Award, a Dividend Equivalent award, a Stock Payment
award or a Stock Appreciation Right, which may be awarded or granted under the
Plan (collectively, “Awards”).

2.3 “Award Agreement” shall mean any written notice, agreement, terms and
conditions, contract or other instrument or document evidencing an Award,
including through electronic medium, which shall contain such terms and
conditions with respect to an Award as the Administrator shall determine
consistent with the Plan.

2.4 “Board” shall mean the Board of Directors of the Company.

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2.5 “Change in Control” means (i) the acquisition by any individual, entity or
group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act)
(other than Apollo Management VI L.P. (together with its affiliates, “Apollo”))
or any of its affiliates or an affiliate of the Company immediately prior to
such acquisition) of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of more than 50%, indirectly or directly, of
the voting power of the Company (other than any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any of
its Subsidiaries) or (ii) consummation of an amalgamation, a merger,
consolidation, recapitalization or similar business combination transaction of
the Company or any direct or indirect subsidiary thereof with any other entity
(other than Apollo or an affiliate of the Company immediately prior to such
transaction) or a sale or other disposition of all or substantially all of the
assets of the Company to any other person or entity (other than Apollo or an
affiliate of the Company immediately prior to such transaction), following which
the voting securities of the Company that are outstanding immediately prior to
such transaction cease to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity (or the person or
entity that owns substantially all of the Company’s assets either directly or
through one or more subsidiaries) or any parent or other affiliate thereof) at
least 50% of the combined voting power of the securities of the Company or, if
the Company is not the surviving entity, such surviving entity (or the person or
entity that owns substantially all of the Company’s assets either directly or
through one or more subsidiaries) or any parent or other affiliate thereof,
outstanding immediately after such transaction.

2.6 “Code” shall mean the Internal Revenue Code of 1986, as amended from time to
time.

2.7 “Committee” shall mean the Compensation Committee of the Board, or another
committee or subcommittee of the Board, appointed as provided in Section 11.1.

2.8 “Common Stock” shall mean the common stock of the Company, par value $0.01
per share.

2.9 “Company” shall mean Noranda Aluminum Holding Corporation, a Delaware
corporation.

2.10 “Consultant” shall mean any consultant or adviser engaged to provide
services to the Company or any Subsidiary that qualifies as a consultant under
the applicable rules of the Securities and Exchange Commission for registration
of shares on a Form S-8 Registration Statement.

2.11 “Director” shall mean a member of the Board, as constituted from time to
time.

2.12 “Dividend Equivalent” shall mean a right to receive the equivalent value
(in cash or Common Stock) of dividends paid on Common Stock, awarded under
Section 8.2.

2.13 “DRO” shall mean a domestic relations order as defined by the Code or Title
I of the Employee Retirement Income Security Act of 1974, as amended from time
to time, or the rules thereunder.

 

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2.14 “Effective Date” shall mean the date the Plan is approved by the Board,
subject to approval of the Plan by the Company’s stockholders.

2.15 “Eligible Individual” shall mean any person who is an Employee, a
Consultant or a Non-Employee Director, as determined by the Committee.

2.16 “Employee” shall mean any officer or other employee (as determined in
accordance with Section 3401(c) of the Code and the Treasury Regulations
thereunder) of the Company or of any Subsidiary.

2.17 “Equity Restructuring” shall mean a nonreciprocal transaction between the
Company and its stockholders, such as a stock dividend, stock split, spin-off,
rights offering or recapitalization through a large, nonrecurring cash dividend,
that affects the number or kind of shares of Common Stock (or other securities
of the Company) or the share price of Common Stock (or other securities) and
causes a change in the per share value of the Common Stock underlying
outstanding Awards.

2.18 “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended
from time to time.

2.19 “Fair Market Value” shall mean, as of any given date, the value of a share
of Common Stock determined as follows:

(a) If the Common Stock is listed on any established stock exchange (such as the
New York Stock Exchange, the NASDAQ Global Market and the NASDAQ Global Select
Market) or national market system, its Fair Market Value shall be the closing
sales price for a share of Common Stock as quoted on such exchange or system for
such date or, if there is no closing sales price for a share of Common Stock on
the date in question, the closing sales price for a share of Common Stock on the
last preceding date for which such quotation exists, as reported in The Wall
Street Journal or such other source as the Administrator deems reliable;

(b) If the Common Stock is not listed on an established stock exchange or
national market system, but the Common Stock is regularly quoted by a recognized
securities dealer, its Fair Market Value shall be the mean of the high bid and
low asked prices for such date or, if there are no high bid and low asked prices
for a share of Common Stock on such date, the high bid and low asked prices for
a share of Common Stock on the last preceding date for which such information
exists, as reported in The Wall Street Journal or such other source as the
Administrator deems reliable; or

(c) If the Common Stock is neither listed on an established stock exchange or a
national market system nor regularly quoted by a recognized securities dealer,
its Fair Market Value shall be established by the Administrator in good faith.

2.20 “Greater Than 10% Stockholder” shall mean an individual then owning (within
the meaning of Section 424(d) of the Code) more than 10% of the total combined
voting power of all classes of stock of the Company or any subsidiary
corporation (as defined in Section 424(f) of the Code) or parent corporation
thereof (as defined in Section 424(e) of the Code).

 

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2.21 “Holder” shall mean a person who has been granted an Award.

2.22 “Incentive Stock Option” shall mean an Option that is intended to qualify
as an incentive stock option and conforms to the applicable provisions of
Section 422 of the Code.

2.23 “Non-Employee Director” shall mean a Director of the Company who is not an
Employee.

2.24 “Non-Qualified Stock Option” shall mean an Option that is not an Incentive
Stock Option.

2.25 “Option” shall mean a right to purchase shares of Common Stock at a
specified exercise price, granted under Article 5. An Option shall be either a
Non-Qualified Stock Option or an Incentive Stock Option; provided, however, that
Options granted to Non-Employee Directors and Consultants shall be Non-Qualified
Stock Options.

2.26 “Performance Award” shall mean a cash bonus award, stock bonus award,
performance award or incentive award that is paid in cash, Common Stock or a
combination of both, awarded under Section 8.1.

2.27 “Performance Criteria” shall mean the criteria (and adjustments) that the
Committee, in its sole discretion, selects for an Award for purposes of
establishing the Performance Goal or Performance Goals for a Performance Period.
The Performance Criteria that shall be used to establish Performance Goals may
include, but are not limited to, the following, which may apply to any of the
Company, any Subsidiary, or any division of the Company and its Subsidiaries:
(i) net earnings (either before or after one or more of the following:
(A) interest, (B) taxes, (C) depreciation and (D) amortization); (ii) gross or
net sales or revenue; (iii) net income (either before or after taxes);
(iv) operating earnings or profit, (v) cash flow (including, but not limited to,
operating cash flow and free cash flow) or cash cost; (vi) return on assets;
(vii) return on capital; (viii) return on stockholders’ equity; (ix) return on
sales, (x) gross or net profit or operating margin; (xi) costs; (xii) funds from
operations; (xiii) expenses; (xiv) working capital; (xv) earnings per share;
(xvi) price per share of Common Stock; (xvii) regulatory body approval for
commercialization of a product; (xviii) implementation or completion of critical
projects; (xix) market share; (xx) objective measures of productivity;
(xxi) operating efficiency; (xxii) economic value-added; (xxiii) cash flow
return on capital; (xxiv) return on net assets, (xxv) metal production,
(xxvi) safety performance, and (xxvii) inventory turns, any of which may be
measured either in absolute terms or as compared to any incremental increase or
decrease or as compared to results of a peer group or to market performance
indicators or indices. The Administrator may, in its sole discretion, provide
that one or more adjustments shall be made to one or more of the Performance
Goals.

2.28 “Performance Goals” shall mean, for a Performance Period, one or more goals
established in writing by the Administrator for the Performance Period based
upon one or more Performance Criteria. Depending on the Performance Criteria
used to establish such Performance Goals, the Performance Goals may be expressed
in terms of overall Company performance or the performance of a Subsidiary,
division, business unit, or an individual. The achievement of each Performance
Goal shall be determined in accordance with GAAP to the extent applicable.

 

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2.29 “Performance Period” shall mean one or more periods of time, which may be
of varying and overlapping durations, as the Administrator may select, over
which the attainment of one or more Performance Goals will be measured for the
purpose of determining a Holder’s right to, and the payment of, a Performance
Award.

2.30 “Plan” shall mean this Noranda Aluminum Holding Corporation 2010 Incentive
Award Plan, as it may be amended or restated from time to time.

2.31 “Restricted Stock” shall mean Common Stock awarded under Article 7 that is
subject to certain restrictions and may be subject to risk of forfeiture or
repurchase.

2.32 “Restricted Stock Units” shall mean the right to receive Common Stock
awarded under Section 8.4.

2.33 “Securities Act” shall mean the Securities Act of 1933, as amended.

2.34 “Stock Appreciation Right” shall mean a stock appreciation right granted
under Article 9.

2.35 “Stock Payment” shall mean (a) a payment in the form of shares of Common
Stock, or (b) an option or other right to purchase shares of Common Stock, as
part of a bonus, deferred compensation or other arrangement, awarded under
Section 8.3.

2.36 “Subsidiary” means any entity (other than the Company), whether domestic or
foreign, in an unbroken chain of entities beginning with the Company if each of
the entities other than the last entity in the unbroken chain beneficially owns,
at the time of the determination, securities or interests representing more than
fifty percent (50%) of the total combined voting power of all classes of
securities or interests in one of the other entities in such chain.

2.37 “Substitute Award” shall mean an Award granted under the Plan upon the
assumption of, or in substitution for, outstanding equity awards previously
granted by a company or other entity in connection with a corporate transaction,
such as a merger, combination, consolidation or acquisition of property or
stock.

2.38 “Termination of Service” shall mean:

(a) As to a Consultant, the time when the engagement of a Holder as a Consultant
to the Company or a Subsidiary is terminated for any reason, with or without
Cause, including, without limitation, by resignation, discharge, death or
retirement, but excluding terminations where the Consultant simultaneously
commences or remains in employment or service with the Company or any
Subsidiary.

 

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(b) As to a Non-Employee Director, the time when a Holder who is a Non-Employee
Director ceases to be a Director for any reason, including, without limitation,
a termination by resignation, failure to be elected, death or retirement, but
excluding terminations where the Holder simultaneously commences or remains in
employment or service with the Company or any Subsidiary.

(c) As to an Employee, the time when the employee-employer relationship between
a Holder and the Company or any Subsidiary is terminated for any reason,
including, without limitation, a termination by resignation, discharge with or
without cause, death, disability or retirement; but excluding terminations where
the Holder simultaneously commences or remains in employment or service with the
Company or any Subsidiary.

The Administrator, in its sole discretion, shall determine the effect of all
matters and questions relating to Terminations of Service, including, without
limitation, the question of whether a Termination of Service resulted from a
discharge for cause and all questions of whether particular leaves of absence
constitute a Termination of Service; provided, however, that, with respect to
Incentive Stock Options, unless the Administrator otherwise provides in the
terms of the Award Agreement or otherwise, a leave of absence, change in status
from an employee to an independent contractor or other change in the
employee-employer relationship shall constitute a Termination of Service only
if, and to the extent that, such leave of absence, change in status or other
change interrupts employment for the purposes of Section 422(a)(2) of the Code
and the then applicable regulations and revenue rulings under said Section. For
purposes of the Plan, a Holder’s employee-employer relationship or consultancy
relations shall be deemed to be terminated in the event that the Subsidiary
employing or contracting with such Holder ceases to remain a Subsidiary
following any merger, sale of stock or other corporate transaction or event
(including, without limitation, a spin-off). In the event that an Award
hereunder is intended to be “deferred compensation” compliant with to
Section 409A of the Code, the Committee may modify the definition of
“Termination of Service” to facilitate such compliance.

ARTICLE 3

SHARES SUBJECT TO THE PLAN

3.1 Number of Shares.

(a) Subject to Section 12.2 and Section 3.1(b), the aggregate number of shares
of Common Stock which may be issued or transferred pursuant to Awards under the
Plan is 5,200,000.

(b) To the extent that an Award terminates, expires, or lapses for any reason,
or an Award is settled in cash without the delivery of shares to the Holder,
then any shares of Common Stock subject to the Award shall again be available
for the grant of an Award pursuant to the Plan. Any shares of Common Stock
tendered or withheld to satisfy the grant or exercise price or tax withholding
obligation pursuant to any Award (other than an Option) shall again be available
for the grant of an Award pursuant to the Plan. Any shares of Common Stock
repurchased by the Company under Section 7.4 at the same price paid by the
Holder so that such shares are returned to the Company will again be available
for Awards. To the extent permitted by applicable law or any exchange rule,
shares of Common Stock issued in assumption of, or in

 

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substitution for, any outstanding awards of any entity acquired in any form of
combination by the Company or any Subsidiary shall not be counted against shares
of Common Stock available for grant pursuant to the Plan. The payment of
Dividend Equivalents in cash in conjunction with any outstanding Awards shall
not be counted against the shares available for issuance under the Plan.
Notwithstanding the provisions of this Section 3.1(b), no shares of Common Stock
may again be optioned, granted or awarded if such action would cause an
Incentive Stock Option to fail to qualify as an incentive stock option under
Section 422 of the Code.

3.2 Stock Distributed. Any Common Stock distributed pursuant to an Award may
consist, in whole or in part, of authorized and unissued Common Stock, treasury
Common Stock or Common Stock purchased on the open market.

ARTICLE 4

GRANTING OF AWARDS

4.1 Participation. The Administrator may, from time to time, select from among
all Eligible Individuals, those to whom an Award shall be granted and shall
determine the nature and amount of each Award, which shall not be inconsistent
with the requirements of the Plan. No Eligible Individual shall have any right
to be granted an Award pursuant to the Plan.

4.2 Award Agreement. Each Award shall be evidenced by an Award Agreement. Award
Agreements evidencing Incentive Stock Options shall contain such terms and
conditions as may be necessary to meet the applicable provisions of Section 422
of the Code.

4.3 Limitations Applicable to Section 16 Persons. Notwithstanding any other
provision of the Plan, the Plan, and any Award granted or awarded to any
individual who is then subject to Section 16 of the Exchange Act, shall be
subject to any additional limitations set forth in any applicable exemptive rule
under Section 16 of the Exchange Act (including Rule 16b-3 of the Exchange Act
and any amendments thereto) that are requirements for the application of such
exemptive rule. To the extent permitted by applicable law, the Plan and Awards
granted or awarded hereunder shall be deemed amended to the extent necessary to
conform to such applicable exemptive rule.

4.4 At-Will Employment. Nothing in the Plan or in any Award Agreement hereunder
shall confer upon any Holder any right to continue in the employ of, or as a
Director or Consultant for the Company or any Subsidiary, or shall interfere
with or restrict in any way the rights of the Company and any Subsidiary, which
rights are hereby expressly reserved, to discharge any Holder at any time for
any reason whatsoever, with or without Cause, except to the extent expressly
provided otherwise in a written agreement between the Holder and the Company or
any Subsidiary.

4.5 Foreign Holders. Notwithstanding any provision of the Plan to the contrary,
in order to comply with the laws in other countries in which the Company and its
Subsidiaries operate or have Employees, Non-Employee Directors or Consultants,
or in order to comply with the requirements of any foreign stock exchange, the
Administrator, in its sole discretion, shall have the power and authority to:
(a) determine which Subsidiaries shall be covered by the Plan;

 

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(b) determine which Eligible Individuals outside the United States are eligible
to participate in the Plan; (c) modify the terms and conditions of any Award
granted to Eligible Individuals outside the United States to comply with
applicable foreign laws or listing requirements of any such foreign stock
exchange; (d) establish subplans and modify exercise procedures and other terms
and procedures, to the extent such actions may be necessary or advisable (any
such subplans and/or modifications shall be attached to the Plan as appendices);
provided, however, that no such subplans and/or modifications shall increase the
share limitations contained in Sections 3.1 and 3.3; and (e) take any action,
before or after an Award is made, that it deems advisable to obtain approval or
comply with any necessary local governmental regulatory exemptions or approvals
or listing requirements of any such foreign stock exchange. Notwithstanding the
foregoing, the Administrator may not take any actions hereunder, and no Awards
shall be granted, that would violate the Code, the Exchange Act, the Securities
Act or any other securities law or governing statute or any other applicable
law.

4.6 Stand-Alone and Tandem Awards. Awards granted pursuant to the Plan may, in
the sole discretion of the Administrator, be granted either alone, in addition
to, or in tandem with, any other Award granted pursuant to the Plan. Awards
granted in addition to or in tandem with other Awards may be granted either at
the same time as or at a different time from the grant of such other Awards.

ARTICLE 5

GRANTING OF OPTIONS

5.1 Granting of Options to Eligible Individuals. The Administrator is authorized
to grant Options to Eligible Individuals from time to time, in its sole
discretion, on such terms and conditions as it may determine which shall not be
inconsistent with the Plan.

5.2 Qualification of Incentive Stock Options. No Incentive Stock Option shall be
granted to any person who is not an Employee of the Company or any subsidiary
corporation of the Company (as defined in Section 424(f) of the Code). No person
who qualifies as a Greater Than 10% Stockholder may be granted an Incentive
Stock Option unless such Incentive Stock Option conforms to the applicable
provisions of Section 422 of the Code. Any Incentive Stock Option granted under
the Plan may be modified by the Administrator, with the consent of the Holder,
to disqualify such Option from treatment as an “incentive stock option” under
Section 422 of the Code. To the extent that the aggregate fair market value of
stock with respect to which “incentive stock options” (within the meaning of
Section 422 of the Code, but without regard to Section 422(d) of the Code) are
exercisable for the first time by a Holder during any calendar year under the
Plan, and all other plans of the Company and any Subsidiary or parent
corporation thereof (as defined in Section 424(e) of the Code), exceeds
$100,000, the Options shall be treated as Non-Qualified Stock Options to the
extent required by Section 422 of the Code. The rule set forth in the preceding
sentence shall be applied by taking Options and other “incentive stock options”
into account in the order in which they were granted and the fair market value
of stock shall be determined as of the time the respective options were granted.

 

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5.3 Option Exercise Price. The exercise price per share of Common Stock subject
to each Option shall be set by the Administrator, but shall not be less than
100% of the Fair Market Value of a share of Common Stock on the date the Option
is granted (or, as to Incentive Stock Options, on the date the Option is
modified, extended or renewed for purposes of Section 424(h) of the Code), or in
the event of any change in the exercise price of such Option, on the date the
repricing becomes effective. In addition, in the case of Incentive Stock Options
granted to a Greater Than 10% Stockholder, such price shall not be less than
110% of the Fair Market Value of a share of Common Stock on the date the Option
is granted (or the date the Option is modified, extended or renewed for purposes
of Section 424(h) of the Code).

5.4 Option Term. The term of each Option shall be set by the Administrator in
its sole discretion; provided, however, that the term shall not be more than ten
(10) years from the date the Option is granted, or five (5) years from the date
an Incentive Stock Option is granted to a Greater Than 10% Stockholder. The
Administrator shall determine the time period, including the time period
following a Termination of Service, during which the Holder has the right to
exercise the vested Options, which time period may not extend beyond the term of
the Option term. Except as limited by the requirements of Section 409A or
Section 422 of the Code and regulations and rulings thereunder, the
Administrator may extend the term of any outstanding Option, and may extend the
time period during which vested Options may be exercised, in connection with any
Termination of Service of the Holder, and may amend any other term or condition
of such Option relating to such a Termination of Service.

5.5 Option Vesting.

(a) The period during which the right to exercise, in whole or in part, an
Option vests in the Holder shall be set by the Administrator and the
Administrator may determine that an Option may not be exercised in whole or in
part for a specified period after it is granted. Such vesting may be based on
service with the Company or any Subsidiary, any of the Performance Criteria, or
any other criteria selected by the Administrator. At any time after grant of an
Option, the Administrator may, in its sole discretion and subject to whatever
terms and conditions it selects, accelerate the period during which an Option
vests.

(b) No portion of an Option which is unexercisable at a Holder’s Termination of
Service shall thereafter become exercisable, except as may be otherwise provided
by the Administrator either in the Award Agreement or by action of the
Administrator following the grant of the Option.

5.6 Substitute Awards. Notwithstanding the foregoing provisions of this Article
5 to the contrary, in the case of an Option that is a Substitute Award, the
price per share of the shares subject to such Option may be less than the Fair
Market Value per share on the date of grant, provided, that the excess of:
(a) the aggregate Fair Market Value (as of the date such Substitute Award is
granted) of the shares subject to the Substitute Award, over (b) the aggregate
exercise price thereof does not exceed the excess of: (x) the aggregate fair
market value (as of the time immediately preceding the transaction giving rise
to the Substitute Award, such fair market value to be determined by the
Administrator) of the shares of the predecessor entity that were subject to the
grant assumed or substituted for by the Company, over (y) the aggregate exercise
price of such shares.

 

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5.7 Substitution of Stock Appreciation Rights. The Administrator may provide in
the Award Agreement evidencing the grant of an Option that the Administrator, in
its sole discretion, shall have the right to substitute a Stock Appreciation
Right for such Option at any time prior to or upon exercise of such Option;
provided, that such Stock Appreciation Right shall be exercisable with respect
to the same number of shares of Common Stock for which such substituted Option
would have been exercisable.

ARTICLE 6

EXERCISE OF OPTIONS

6.1 Partial Exercise. An exercisable Option may be exercised in whole or in
part. However, an Option shall not be exercisable with respect to fractional
shares and the Administrator may require that, by the terms of the Option, a
partial exercise must be with respect to a minimum number of shares.

6.2 Manner of Exercise. All or a portion of an exercisable Option shall be
deemed exercised upon delivery of all of the following to the Secretary of the
Company, or such other person or entity designated by the Administrator, or his,
her or its office, as applicable:

(a) A written notice complying with the applicable rules established by the
Administrator stating that the Option, or a portion thereof, is exercised. The
notice shall be signed by the Holder or other person then entitled to exercise
the Option or such portion of the Option;

(b) Such representations and documents as the Administrator, in its sole
discretion, deems necessary or advisable to effect compliance with all
applicable provisions of the Securities Act and any other federal, state or
foreign securities laws or regulations. The Administrator may, in its sole
discretion, also take whatever additional actions it deems appropriate to effect
such compliance including, without limitation, placing legends on share
certificates and issuing stop-transfer notices to agents and registrars;

(c) In the event that the Option shall be exercised pursuant to Section 10.3 by
any person or persons other than the Holder, appropriate proof of the right of
such person or persons to exercise the Option; and

(d) Full payment of the exercise price and applicable withholding taxes to the
Secretary of the Company for the shares with respect to which the Option, or
portion thereof, is exercised, in a manner permitted by Section 10.1 and 10.2.

6.3 Notification Regarding Disposition. The Holder shall give the Company prompt
notice of any disposition of shares of Common Stock acquired by exercise of an
Incentive Stock Option which occurs within (a) two years from the date of
granting (including the date the Option is modified, extended or renewed for
purposes of Section 424(h) of the Code) such Option to such Holder, or (b) one
year after the transfer of such shares to such Holder.

 

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ARTICLE 7

AWARD OF RESTRICTED STOCK

7.1 Award of Restricted Stock.

(a) The Administrator is authorized to grant Restricted Stock to Eligible
Individuals, and shall determine the terms and conditions, including the
restrictions applicable to each award of Restricted Stock, which terms and
conditions shall not be inconsistent with the Plan, and may impose such
conditions on the issuance of such Restricted Stock as it deems appropriate.

(b) The Administrator shall establish the purchase price, if any, and form of
payment for Restricted Stock; provided, however, that such purchase price shall
be no less than the par value of the Common Stock to be purchased, unless
otherwise permitted by applicable state law. In all cases, legal consideration
shall be required for each issuance of Restricted Stock.

7.2 Rights as Stockholders. Subject to Section 7.4, upon issuance of Restricted
Stock, the Holder shall have, unless otherwise provided by the Administrator,
all the rights of a stockholder with respect to said shares, subject to the
restrictions in his or her Award Agreement, including the right to receive all
dividends and other distributions paid or made with respect to the shares;
provided, however, that, in the sole discretion of the Administrator, any
extraordinary distributions with respect to the Common Stock shall be subject to
the restrictions set forth in Section 7.3. If so determined by the Administrator
in the applicable Award Agreement, cash dividends on the Restricted Stock may,
subject to Section 8.6, automatically be reinvested in additional Restricted
Stock, held subject to the vesting of the underlying Restricted Stock.

7.3 Restrictions. All shares of Restricted Stock (including any shares received
by Holders thereof with respect to shares of Restricted Stock as a result of
stock dividends, stock splits or any other form of recapitalization) shall, in
the terms of each individual Award Agreement, be subject to such restrictions
and vesting requirements as the Administrator shall provide. Such restrictions
may include, without limitation, restrictions concerning voting rights and
transferability and such restrictions may lapse separately or in combination at
such times and pursuant to such circumstances or based on such criteria as
selected by the Administrator, including, without limitation, criteria based on
the Holder’s duration of employment, directorship or consultancy with the
Company, the Performance Criteria, Company performance, individual performance
or other criteria selected by the Administrator. By action taken after the
Restricted Stock is issued, the Administrator may, on such terms and conditions
as it may determine to be appropriate, accelerate the vesting of such Restricted
Stock by removing any or all of the restrictions imposed by the terms of the
Award Agreement. Restricted Stock may not be sold or encumbered until all
restrictions are terminated or expire.

7.4 Repurchase or Forfeiture of Restricted Stock. If no price was paid by the
Holder for the Restricted Stock, upon a Termination of Service the Holder’s
rights in unvested Restricted Stock then subject to restrictions shall lapse,
and such Restricted Stock shall be surrendered to the Company and cancelled
without consideration. If a price was paid by the

 

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Holder for the Restricted Stock, upon a Termination of Service the Company shall
have the right to repurchase from the Holder the unvested Restricted Stock then
subject to restrictions at a cash price per share equal to the price paid by the
Holder for such Restricted Stock or such other amount as may be specified in the
Award Agreement. The Administrator in its sole discretion may provide that in
the event of certain events, including a Change in Control, the Holder’s death,
retirement or Disability or any other specified Termination of Service or any
other event, the Holder’s rights in unvested Restricted Stock shall not lapse,
such Restricted Stock shall vest and, if applicable, the Company shall not have
a right of repurchase.

7.5 Certificates for Restricted Stock. Restricted Stock granted pursuant to the
Plan may be evidenced in such manner as the Administrator shall determine.
Certificates or book entries evidencing shares of Restricted Stock must include
an appropriate legend referring to the terms, conditions, and restrictions
applicable to such Restricted Stock, and the Company may, in it sole discretion,
retain physical possession of any stock certificate until such time as all
applicable restrictions lapse.

7.6 Section 83(b) Election. If a Holder makes an election under Section 83(b) of
the Code to be taxed with respect to the Restricted Stock as of the date of
transfer of the Restricted Stock rather than as of the date or dates upon which
the Holder would otherwise be taxable under Section 83(a) of the Code, the
Holder shall be required to deliver a copy of such election to the Company
promptly after filing such election with the Internal Revenue Service.

ARTICLE 8

AWARD OF PERFORMANCE AWARDS, DIVIDEND

EQUIVALENTS,

STOCK PAYMENTS, RESTRICTED STOCK UNITS

8.1 Performance Awards.

(a) The Administrator is authorized to grant Performance Awards to any Eligible
Individual. The value of Performance Awards may be linked to any one or more of
the Performance Criteria or other specific criteria determined by the
Administrator, in each case on a specified date or dates or over any period or
periods determined by the Administrator. In making such determinations, the
Administrator shall consider (among such other factors as it deems relevant in
light of the specific type of Award) the contributions, responsibilities and
other compensation of the particular Eligible Individual. Performance Awards may
be paid in cash, shares of Common Stock, or both, as determined by the
Administrator.

(b) Without limiting Section 8.1(a), the Administrator may grant Performance
Awards to any Eligible Individual in the form of a cash bonus payable upon the
attainment of objective Performance Goals, or such other criteria, whether or
not objective, which are established by the Administrator, in each case on a
specified date or dates or over any period or periods determined by the
Administrator.

 

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8.2 Dividend Equivalents. Dividend Equivalents may be granted by the
Administrator based on dividends declared on the Common Stock, to be credited as
of dividend payment dates during the period between the date an Award is granted
to a Holder and the date such Award vests, is exercised, is distributed or
expires, as determined by the Administrator. Such Dividend Equivalents shall be
converted to cash or additional shares of Common Stock by such formula and at
such time and subject to such limitations as may be determined by the
Administrator.

8.3 Stock Payments. The Administrator is authorized to make Stock Payments to
any Eligible Individual. The number or value of shares of any Stock Payment
shall be determined by the Administrator and may be based upon one or more
Performance Criteria or any other specific criteria, including service to the
Company or any Subsidiary, determined by the Administrator. Stock Payments may,
but are not required to be made in lieu of base salary, bonus, fees or other
cash compensation otherwise payable to such Eligible Individual.

8.4 Restricted Stock Units. The Administrator is authorized to grant Restricted
Stock Units to any Eligible Individual. The number and terms and conditions of
Restricted Stock Units shall be determined by the Administrator. The
Administrator shall specify the date or dates on which the Restricted Stock
Units shall become fully vested and nonforfeitable, and may specify such
conditions to vesting as it deems appropriate, including conditions based on one
or more Performance Criteria or other specific criteria, including service to
the Company or any Subsidiary, in each case on a specified date or dates or over
any period or periods, as the Administrator determines. The Administrator shall
specify, or permit the Holder to elect, the conditions and dates upon which the
shares of Common Stock underlying the Restricted Stock Units which shall be
issued, which dates shall not be earlier than the date as of which the
Restricted Stock Units vest and become nonforfeitable and which conditions and
dates shall be subject to compliance with Section 409A of the Code. On the
distribution dates, the Company shall issue to the Holder one unrestricted,
fully transferable share of Common Stock for each vested and nonforfeitable
Restricted Stock Unit.

8.5 Term. The term of a Performance Award, Dividend Equivalent award, Stock
Payment award and/or Restricted Stock Unit award shall be set by the
Administrator in its sole discretion.

8.6 Dividend Reinvestment. Reinvestment of dividends in additional Restricted
Stock at the time of any dividend payment, and the payment of shares of Common
Stock with respect to dividends to participants holding Restricted Stock Units,
shall only be permissible if sufficient shares of Common Stock are available
under Section 3.1 for such reinvestment or payment (taking into account then
outstanding Awards). In the event that sufficient shares 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 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 13(e).

 

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ARTICLE 9

AWARD OF STOCK APPRECIATION RIGHTS

9.1 Grant of Stock Appreciation Rights.

(a) The Administrator is authorized to grant Stock Appreciation Rights to
Eligible Individuals from time to time, in its sole discretion, on such terms
and conditions as it may determine consistent with the Plan.

(b) A Stock Appreciation Right shall entitle the Holder (or other person
entitled to exercise the Stock Appreciation Right pursuant to the Plan) to
exercise all or a specified portion of the Stock Appreciation Right (to the
extent then exercisable pursuant to its terms) and to receive from the Company
an amount determined by multiplying the difference obtained by subtracting the
exercise price per share of the Stock Appreciation Right from the Share Value on
the date of exercise of the Stock Appreciation Right by the number of shares of
Common Stock with respect to which the Stock Appreciation Right shall have been
exercised, subject to any limitations the Administrator may impose. Except as
described in (c) below, the exercise price per share of Common Stock subject to
each Stock Appreciation Right shall be set by the Administrator, but shall not
be less than 100% of the Share Value on the date the Stock Appreciation Right is
granted, or in the event of any change in the exercise price of such Stock
Appreciation Right, on the date the repricing becomes effective.

(c) Notwithstanding the foregoing provisions of Section 9.1(b) to the contrary,
in the case of an Stock Appreciation Right that is a Substitute Award, the price
per share of the shares subject to such Stock Appreciation Right may be less
than the Fair Market Value per share on the date of grant, provided, that the
excess of: (a) the aggregate Fair Market Value (as of the date such Substitute
Award is granted) of the shares subject to the Substitute Award, over (b) the
aggregate exercise price thereof does not exceed the excess of: (x) the
aggregate fair market value (as of the time immediately preceding the
transaction giving rise to the Substitute Award, such fair market value to be
determined by the Administrator) of the shares of the predecessor entity that
were subject to the grant assumed or substituted for by the Company, over
(y) the aggregate exercise price of such shares.

9.2 Stock Appreciation Right Vesting.

(a) The period during which the right to exercise, in whole or in part, a Stock
Appreciation Right vests in the Holder shall be set by the Administrator and the
Administrator may determine that a Stock Appreciation Right may not be exercised
in whole or in part for a specified period after it is granted. Such vesting may
be based on service with the Company or any Subsidiary, or any other criteria
selected by the Administrator. At any time after grant of a Stock Appreciation
Right, the Administrator may, in its sole discretion and subject to whatever
terms and conditions it selects, accelerate the period during which a Stock
Appreciation Right vests.

(b) No portion of a Stock Appreciation Right which is unexercisable at
Termination of Service shall thereafter become exercisable, except as may be
otherwise provided by the Administrator either in the Award Agreement or by
action of the Administrator following the grant of the Stock Appreciation Right.

 

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9.3 Manner of Exercise. All or a portion of an exercisable Stock Appreciation
Right shall be deemed exercised upon delivery of all of the following to the
Secretary of the Company, or such other person or entity designated by the
Administrator, or his, her or its office, as applicable:

(a) A written notice complying with the applicable rules established by the
Administrator stating that the Stock Appreciation Right, or a portion thereof,
is exercised. The notice shall be signed by the Holder or other person then
entitled to exercise the Stock Appreciation Right or such portion of the Stock
Appreciation Right;

(b) Such representations and documents as the Administrator, in its sole
discretion, deems necessary or advisable to effect compliance with all
applicable provisions of the Securities Act and any other federal, state or
foreign securities laws or regulations. The Administrator may, in its sole
discretion, also take whatever additional actions it deems appropriate to effect
such compliance; and

(c) In the event that the Stock Appreciation Right shall be exercised pursuant
to this Section 9.3 by any person or persons other than the Holder, appropriate
proof of the right of such person or persons to exercise the Stock Appreciation
Right.

9.4 Payment. Payment of the amounts determined under Section 9.2(c) and 9.3(b)
above shall be in cash, shares of Common Stock (based on its Fair Market Value
as of the date the Stock Appreciation Right is exercised), or a combination of
both, as determined by the Administrator.

ARTICLE 10

ADDITIONAL TERMS OF AWARDS

10.1 Payment. The Administrator shall determine the methods by which payments by
any Holder with respect to any Awards granted under the Plan shall be made,
which may include, without limitation: (a) cash or check, (b) shares of Common
Stock (including, in the case of payment of the exercise price of an Award,
shares of Common Stock issuable pursuant to the exercise of the Award) or shares
of Common Stock held for such period of time as may be required by the
Administrator in order to avoid adverse accounting consequences, in each case,
having a Fair Market Value on the date of delivery equal to the aggregate
payments required, (c) delivery of a notice that the Holder has placed a market
sell order with a broker with respect to shares of Common Stock then issuable
upon exercise or vesting of an Award, and that the broker has been directed to
pay a sufficient portion of the net proceeds of the sale to the Company in
satisfaction of the aggregate payments required, provided, that payment of such
proceeds is then made to the Company upon settlement of such sale, or (d) other
form of legal consideration acceptable to the Administrator, including, if
authorized by the Administrator, by permitting the Holder to instruct the
Company to withhold a number of shares of Common Stock having a Fair Market
Value (based on the Fair Market Value of the Common Stock on the date the
applicable

 

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Award is exercised) equal to the product of (x) the applicable exercise price
multiplied by (y) the number of shares of Common Stock in respect of which the
applicable Award shall have been exercised. The Administrator shall also
determine the methods by which shares of Common Stock shall be delivered or
deemed to be delivered to Holders. Notwithstanding any other provision of the
Plan to the contrary, no Holder who is a Director or an “executive officer” of
the Company within the meaning of Section 13(k) of the Exchange Act shall be
permitted to make payment with respect to any Awards granted under the Plan, or
continue any extension of credit with respect to such payment with a loan from
the Company or a loan arranged by the Company in violation of Section 13(k) of
the Exchange Act.

10.2 Tax Withholding. The Company or any Subsidiary shall have the authority and
the right to deduct or withhold, or require a Holder to remit to the Company, an
amount sufficient to satisfy federal, state, local and foreign taxes (including
the Holder’s FICA or employment tax obligation) required by law to be withheld
with respect to any taxable event concerning a Holder arising as a result of the
Plan. The Administrator may in its sole discretion and in satisfaction of the
foregoing requirement allow a Holder to elect to have the Company withhold
shares of Common Stock otherwise issuable under an Award (or allow the surrender
of shares of Common Stock). The number of shares of Common Stock which may be so
withheld or surrendered shall be limited to the number of shares which have a
Fair Market Value on the date of withholding or repurchase equal to the
aggregate amount of such liabilities based on the minimum statutory withholding
rates for federal, state, local and foreign income tax and payroll tax purposes
that are applicable to such supplemental taxable income. The Administrator shall
determine the fair market value of the Common Stock, consistent with applicable
provisions of the Code, for tax withholding obligations due in connection with a
broker-assisted cashless Option or Stock Appreciation Right exercise involving
the sale of shares to pay the Option or Stock Appreciation Right exercise price
or any tax withholding obligation.

10.3 Transferability of Awards.

(a) Except as otherwise provided in Section 10.3(b):

(i) No Award under the Plan may be sold, pledged, assigned or transferred in any
manner other than by will or the laws of descent and distribution or, subject to
the consent of the Administrator, pursuant to a DRO, unless and until such Award
has been exercised, or the shares underlying such Award have been issued, and
all restrictions applicable to such shares have lapsed;

(ii) No Award or interest or right therein shall be liable for the debts,
contracts or engagements of the Holder or his successors in interest or shall be
subject to disposition by transfer, alienation, anticipation, pledge,
hypothecation, encumbrance, assignment or any other means whether such
disposition be voluntary or involuntary or by operation of law by judgment,
levy, attachment, garnishment or any other legal or equitable proceedings
(including bankruptcy), and any attempted disposition thereof shall be null and
void and of no effect, except to the extent that such disposition is permitted
by the preceding sentence; and

 

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(iii) During the lifetime of the Holder, only the Holder may exercise an Award
(or any portion thereof) granted to him under the Plan, unless it has been
disposed of pursuant to a DRO; after the death of the Holder, any exercisable
portion of an Award may, prior to the time when such portion becomes
unexercisable under the Plan or the applicable Award Agreement, be exercised by
his personal representative or by any person empowered to do so under the
deceased Holder’s will or under the then applicable laws of descent and
distribution.

(b) Notwithstanding Section 10.3(a), the Administrator, in its sole discretion,
may determine to permit a Holder to transfer an Award other than an Incentive
Stock Option to any one or more Permitted Transferees (as defined below),
subject to the following terms and conditions: (i) an Award transferred to a
Permitted Transferee shall not be assignable or transferable by the Permitted
Transferee other than by will or the laws of descent and distribution; (ii) an
Award transferred to a Permitted Transferee shall continue to be subject to all
the terms and conditions of the Award as applicable to the original Holder
(other than the ability to further transfer the Award); and (iii) the Holder and
the Permitted Transferee shall execute any and all documents requested by the
Administrator, including, without limitation documents to (A) confirm the status
of the transferee as a Permitted Transferee, (B) satisfy any requirements for an
exemption for the transfer under applicable federal, state and foreign
securities laws and (C) evidence the transfer. For purposes of this
Section 10.3(b), “Permitted Transferee” shall mean, with respect to a Holder,
any “family member” of the Holder, as defined under the instructions to use of
the Form S-8 Registration Statement under the Securities Act, or any other
transferee specifically approved by the Administrator after taking into account
any state, federal, local or foreign tax and securities laws applicable to
transferable Awards.

(c) Notwithstanding Section 10.3(a), a Holder may, in the manner determined by
the Administrator, designate a beneficiary to exercise the rights of the Holder
and to receive any distribution with respect to any Award upon the Holder’s
death. A beneficiary, legal guardian, legal representative, or other person
claiming any rights pursuant to the Plan is subject to all terms and conditions
of the Plan and any Award Agreement applicable to the Holder, except to the
extent the Plan and Award Agreement otherwise provide, and to any additional
restrictions deemed necessary or appropriate by the Administrator. If the Holder
is married and resides in a community property state, a designation of a person
other than the Holder’s spouse as his or her beneficiary with respect to more
than 50% of the Holder’s interest in the Award shall not be effective without
the prior written consent of the Holder’s spouse. If no beneficiary has been
designated or survives the Holder, payment shall be made to the person entitled
thereto pursuant to the Holder’s will or the laws of descent and distribution.
Subject to the foregoing, a beneficiary designation may be changed or revoked by
a Holder at any time provided the change or revocation is filed with the
Administrator prior to the Holder’s death.

10.4 Conditions to Issuance of Shares.

(a) Notwithstanding anything herein to the contrary, the Company shall not be
required to issue or deliver any certificates or make any book entries
evidencing shares of Common Stock pursuant to the exercise of any Award, unless
and until the Board has determined, with advice of counsel, that the issuance of
such shares is in compliance with all applicable laws, regulations of
governmental authorities and, if applicable, the requirements of

 

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any exchange on which the shares of Common Stock are listed or traded, and the
shares of Common Stock are covered by an effective registration statement or
applicable exemption from registration. In addition to the terms and conditions
provided herein, the Board may require that a Holder make such reasonable
covenants, agreements, and representations as the Board, in its discretion,
deems advisable in order to comply with any such laws, regulations, or
requirements.

(b) All Common Stock certificates delivered pursuant to the Plan and all shares
issued pursuant to book entry procedures are subject to any stop-transfer orders
and other restrictions as the Administrator deems necessary or advisable to
comply with federal, state, or foreign securities or other laws, rules and
regulations and the rules of any securities exchange or automated quotation
system on which the Common Stock is listed, quoted, or traded. The Administrator
may place legends on any Common Stock certificate or book entry to reference
restrictions applicable to the Common Stock.

(c) The Administrator shall have the right to require any Holder to comply with
any timing or other restrictions with respect to the settlement, distribution or
exercise of any Award, including a window-period limitation, as may be imposed
in the sole discretion of the Administrator.

(d) No fractional shares of Common Stock shall be issued and the Administrator
shall determine, in its sole discretion, whether cash shall be given in lieu of
fractional shares or whether such fractional shares shall be eliminated by
rounding down.

(e) Notwithstanding any other provision of the Plan, unless otherwise determined
by the Administrator or required by any applicable law, rule or regulation, the
Company shall not deliver to any Holder certificates evidencing shares of Common
Stock issued in connection with any Award and instead such shares of Common
Stock shall be recorded in the books of the Company (or, as applicable, its
transfer agent or stock plan administrator).

10.5 Forfeiture Provisions. Pursuant to its general authority to determine the
terms and conditions applicable to Awards under the Plan, the Administrator
shall have the right to provide, in the terms of Awards made under the Plan, or
to require a Holder to agree by separate written instrument, that: (a)(i) any
proceeds, gains or other economic benefit actually or constructively received by
the Holder upon any receipt or exercise of the Award, or upon the receipt or
resale of any Common Stock underlying the Award, must be paid to the Company,
and (ii) the Award shall terminate and any unexercised portion of the Award
(whether or not vested) shall be forfeited, if (b)(i) a Termination of Service
occurs prior to a specified date, or within a specified time period following
receipt or exercise of the Award, or (ii) the Holder at any time, or during a
specified time period, engages in any activity in competition with the Company,
or which is inimical, contrary or harmful to the interests of the Company, as
further defined by the Administrator or (iii) the Holder incurs a Termination of
Service for “cause” (as such term is defined in the sole discretion of the
Administrator, or as set forth in a written agreement relating to such Award
between the Company and the Holder).

10.6 Repricings and Exchanges. The Administrator may, without the approval of
the shareholders of the Company, authorize (i) the amendment of any outstanding
Option or Stock Appreciation Right award to reduce its exercise price per share

 

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and/or (ii) cancellation of an Award and replacement with the grant of an Award
having a lesser exercise price per share provided such action does not violate
Section 489A of the Code. Subject to Section 12.2, the Administrator shall have
the authority, without the approval of the shareholders of the Company, to amend
any outstanding award to increase the price per share or to cancel and replace
an Award with the grant of an Award having a price per share that is greater
than or equal to the price per share of the original Award. The Administrator
may, without the approval of the shareholders of the Company, at any time buy
from a Holder an Option or Stock Appreciation Right previously granted with
payment in cash, securities of the Company or other consideration, based on such
terms and conditions as the Administrator and the Holder may agree.

ARTICLE 11

ADMINISTRATION

11.1 Administrator. The Compensation Committee (or another committee or a
subcommittee of the Board assuming the functions of the Committee under the
Plan) shall administer the Plan (except as otherwise permitted herein). Unless
otherwise determined by the Board, the Committee shall consist solely of two or
more Non-Employee Directors appointed by and holding office at the pleasure of
the Board, each of whom is intended to qualify as both a “non-employee director”
as defined by Rule 16b-3 of the Exchange Act or any successor rule and an
“independent director” under the rules of the New York Stock Exchange (or other
principal securities market on which shares of Common Stock are traded);
provided, that any action taken by the Committee shall be valid and effective,
whether or not members of the Committee at the time of such action are later
determined not to have satisfied the requirements for membership set forth in
this Section 11.l or otherwise provided in any charter of the Committee. Except
as may otherwise be provided in any charter of the Committee, appointment of
Committee members shall be effective upon acceptance of appointment. Committee
members may resign at any time by delivering written notice to the Board.
Vacancies in the Committee may only be filled by the Board. Notwithstanding the
foregoing, (a) the full Board, acting by a majority of its members in office,
shall conduct the general administration of the Plan with respect to Awards
granted to Non-Employee Directors and (b) the Board or Committee may delegate
its authority hereunder to the extent permitted by Section 11.6.

11.2 Duties and Powers of Committee. It shall be the duty of the Committee to
conduct the general administration of the Plan in accordance with its
provisions. The Committee shall have the power to interpret the Plan and the
Award Agreement, and to adopt such rules for the administration, interpretation
and application of the Plan as are not inconsistent therewith, to interpret,
amend or revoke any such rules and to amend any Award Agreement provided that
the rights or obligations of the holder of the Award that is the subject of any
such Award Agreement are not affected adversely by such amendment, unless the
consent of the Holder is obtained or such amendment is otherwise permitted under
Section 12.9. Any such grant or award under the Plan need not be the same with
respect to each holder. Any such interpretations and rules with respect to
Incentive Stock Options shall be consistent with the provisions of Section 422
of the Code. In its sole discretion, the Board may at any time and from time to
time exercise any and all rights and duties of the Committee under the Plan
except with respect to matters which, under Rule 16b-3 under the Exchange Act or
any successor rule, are required to be determined in the sole discretion of the
Committee.

 

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11.3 Action by the Committee. Unless otherwise established by the Board or in
any charter of the Committee, a majority of the Committee shall constitute a
quorum and the acts of a majority of the members present at any meeting at which
a quorum is present, and acts approved in writing by all members of the
Committee in lieu of a meeting, shall be deemed the acts of the Committee. Each
member of the Committee is entitled to, in good faith, rely or act upon any
report or other information furnished to that member by any officer or other
employee of the Company or any Subsidiary, the Company’s independent certified
public accountants, or any executive compensation consultant or other
professional retained by the Company to assist in the administration of the
Plan.

11.4 Authority of Administrator. Subject to any specific designation in the
Plan, the Administrator has the exclusive power, authority and sole discretion
to:

(a) Designate Eligible Individuals to receive Awards;

(b) Determine the type or types of Awards to be granted to each Holder;

(c) Determine the number of Awards to be granted and the number of shares of
Common Stock to which an Award will relate;

(d) Determine the terms and conditions of any Award granted pursuant to the
Plan, including, but not limited to, the exercise price, grant price, or
purchase price, any reload provision, any restrictions or limitations on the
Award, any schedule for vesting, lapse of forfeiture restrictions or
restrictions on the exercisability of an Award, and accelerations or waivers
thereof, and any provisions related to non-competition and recapture of gain on
an Award, and any increase or reduction in the exercise price of any outstanding
Awards, based in each case on such considerations as the Administrator in its
sole discretion determines;

(e) Determine whether, to what extent, and pursuant to what circumstances an
Award may be settled in, or the exercise price of an Award may be paid in cash,
Common Stock, other Awards, or other property, or an Award may be canceled,
forfeited, or surrendered;

(f) Prescribe the form of each Award Agreement, which need not be identical for
each Holder;

(g) Decide all other matters that must be determined in connection with an
Award;

(h) Establish, adopt, or revise any rules and regulations as it may deem
necessary or advisable to administer the Plan;

(i) Interpret the terms of, and any matter arising pursuant to, the Plan or any
Award Agreement; and

(j) Make all other decisions and determinations that may be required pursuant to
the Plan or as the Administrator deems necessary or advisable to administer the
Plan.

11.5 Decisions Binding. The Administrator’s interpretation of the Plan, any
Awards granted pursuant to the Plan, any Award Agreement and all decisions and
determinations by the Administrator with respect to the Plan are final, binding,
and conclusive on all parties.

 

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11.6 Delegation of Authority. To the extent permitted by applicable law, the
Board or Committee may from time to time delegate to a committee of one or more
members of the Board or one or more officers of the Company the authority to
grant or amend Awards; provided, however, that in no event shall an officer be
delegated the authority to grant awards to, or amend awards held by, the
following individuals: (a) individuals who are subject to Section 16 of the
Exchange Act, or (b) officers of the Company (or Directors) to whom authority to
grant or amend Awards has been delegated hereunder. Any delegation hereunder
shall be subject to the restrictions and limits that the Board or Committee
specifies at the time of such delegation, and the Board may at any time rescind
the authority so delegated or appoint a new delegate. At all times, the delegate
appointed under this Section 11.6 shall serve in such capacity at the pleasure
of the Board and the Committee.

ARTICLE 12

MISCELLANEOUS PROVISIONS

12.1 Amendment, Suspension or Termination of the Plan. Except as otherwise
provided in this Section 12.1, the Plan may be wholly or partially amended or
otherwise modified, suspended or terminated at any time or from time to time by
the Board. However, without approval of the Company’s stockholders given within
twelve (12) months before or after the action by the Administrator, no action of
the Administrator may, except as provided in Section 12.2, increase the limits
imposed in Section 3.1 on the maximum number of shares which may be issued under
the Plan. Except as provided in Section 12.9, no amendment, suspension or
termination of the Plan shall, without the consent of the Holder, impair any
rights or obligations under any Award theretofore granted or awarded, unless the
Award itself otherwise expressly so provides. No Awards may be granted or
awarded during any period of suspension or after termination of the Plan, and in
no event may any Award be granted under the Plan after the tenth
(10th) anniversary of the Effective Date.

12.2 Changes in Common Stock or Assets of the Company, Acquisition or
Liquidation of the Company and Other Corporate Events.

(a) In the event of any stock dividend, Equity Restructuring, stock split,
combination or exchange of shares, merger, consolidation or other distribution
(other than normal cash dividends) of Company assets to stockholders, or any
other change affecting the shares of the Company’s stock or the share price of
the Company’s stock, the Administrator shall make equitable adjustments, if any,
to reflect such change with respect to (i) the aggregate number and kind of
shares that may be issued under the Plan (including, but not limited to,
adjustments of the limitations in Section 3.1 on the maximum number and kind of
shares which may be issued under the Plan); (ii) the number and kind of shares
of Common Stock (or other securities or property) subject to outstanding Awards;
(iii) the terms and conditions of any outstanding Awards (including, without
limitation, any applicable performance targets or criteria with respect
thereto); and (iv) the grant or exercise price per share for any outstanding
Awards under the Plan.

 

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(b) In the event of a Change in Control, any transaction or event described in
Section 12.2(a) or any unusual or nonrecurring transactions or events affecting
the Company, any affiliate of the Company, or the financial statements of the
Company or any affiliate, or of changes in applicable laws, regulations or
accounting principles, the Administrator, in its sole discretion, and on such
terms and conditions as it deems appropriate, either by the terms of the Award
or by action taken prior to the occurrence of such transaction or event and
either automatically or upon the Holder’s request, is hereby authorized to take
any one or more of the following actions whenever the Administrator determines
that such action is appropriate in order to prevent dilution or enlargement of
the benefits or potential benefits intended to be made available under the Plan
or with respect to any Award under the Plan, to facilitate such transactions or
events or to give effect to such changes in laws, regulations or principles.

(i) To provide for either (A) termination of any such Award in exchange for an
amount of cash, if any, equal to the amount that would have been attained upon
the exercise of such Award or realization of the Holder’s rights (and, for the
avoidance of doubt, if as of the date of the occurrence of the transaction or
event described in this Section 12.2 the Administrator determines in good faith
that no amount would have been attained upon the exercise of such Award or
realization of the Holder’s rights, then such Award may be terminated by the
Company without payment) or (B) the replacement of such Award with other rights
or property selected by the Administrator in its sole discretion having an
aggregate value not exceeding the amount that could have been attained upon the
exercise of such Award or realization of the Holder’s rights had such Award been
currently exercisable or payable or fully vested;

(ii) To provide that such Award be assumed by the successor or survivor
corporation, or a parent or subsidiary thereof, or shall be substituted for by
similar options, rights or awards covering the stock of the successor or
survivor corporation, or a parent or subsidiary thereof, with appropriate
adjustments as to the number and kind of shares and prices;

(iii) To make adjustments in the number and type of shares of the Company’s
stock (or other securities or property) subject to outstanding Awards, and in
the number and kind of outstanding Restricted Stock and/or in the terms and
conditions of (including the grant or exercise price), and the criteria included
in, outstanding Awards and Awards which may be granted in the future;

(iv) To provide that such Award shall be exercisable or payable or fully vested
with respect to all shares covered thereby, notwithstanding anything to the
contrary in the Plan or the applicable Award Agreement; and

(v) To provide that the Award cannot vest, be exercised or become payable after
such event.

(c) The Administrator may, in its sole discretion, include such further
provisions and limitations in any Award, agreement or certificate, as it may
deem equitable and in the best interests of the Company that are not
inconsistent with the provisions of the Plan.

 

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(d) No adjustment or action described in this Section 12.2 or in any other
provision of the Plan shall be authorized to the extent that such adjustment or
action would cause the Plan to violate Section 422(b)(1) of the Code.
Furthermore, no such adjustment or action shall be authorized to the extent such
adjustment or action would result in short-swing profits liability under
Section 16 or violate the exemptive conditions of Rule 16b-3 unless the
Administrator determines that the Award is not to comply with such exemptive
conditions.

(e) The existence of the Plan, the Award Agreement and the Awards granted
hereunder shall not affect or restrict in any way the right or power of the
Company or the stockholders of the Company to make or authorize any adjustment,
recapitalization, reorganization or other change in the Company’s capital
structure or its business, any merger or consolidation of the Company, any issue
of stock or of options, warrants or rights to purchase stock or of bonds,
debentures, preferred or prior preference stocks whose rights are superior to or
affect the Common Stock or the rights thereof or which are convertible into or
exchangeable for Common Stock, or the dissolution or liquidation of the company,
or any sale or transfer of all or any part of its assets or business, or any
other corporate act or proceeding, whether of a similar character or otherwise.

(f) In the event of any pending stock dividend, stock split, combination or
exchange of shares, merger, consolidation or other distribution (other than
normal cash dividends) of Company assets to stockholders, or any other change
affecting the shares of Stock or the share price of the Stock including any
Equity Restructuring, for reasons of administrative convenience, the Company in
its sole discretion may refuse to permit the exercise of any Award during a
period of thirty (30) days prior to the consummation of any such transaction.

12.3 No Stockholders Rights. Except as otherwise provided herein, a Holder shall
have none of the rights of a stockholder with respect to shares of Common Stock
covered by any Award until the Holder becomes the record owner of such shares of
Common Stock.

12.4 Paperless Administration. In the event that the Company establishes, for
itself or using the services of a third party, an automated system for the
documentation, granting or exercise of Awards, such as a system using an
internet website or interactive voice response, then the paperless
documentation, granting or exercise of Awards by a Holder may be permitted
through the use of such an automated system.

12.5 Effect of Plan upon Other Compensation Plans. The adoption of the Plan
shall not affect any other compensation or incentive plans in effect for the
Company or any Subsidiary. Nothing in the Plan shall be construed to limit the
right of the Company or any Subsidiary: (a) to establish any other forms of
incentives or compensation for Employees, Directors or Consultants of the
Company or any Subsidiary, or (b) to grant or assume options or other rights or
awards otherwise than under the Plan in connection with any proper corporate
purpose including without limitation, the grant or assumption of options in
connection with the acquisition by purchase, lease, merger, consolidation or
otherwise, of the business, stock or assets of any corporation, partnership,
limited liability company, firm or association.

 

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12.6 Compliance with Laws. The Plan, the granting and vesting of Awards under
the Plan and the issuance and delivery of shares of Common Stock and the payment
of money under the Plan or under Awards granted or awarded hereunder are subject
to compliance with all applicable federal, state, local and foreign laws, rules
and regulations (including but not limited to state, federal and foreign
securities law and margin requirements) and to such approvals by any listing,
regulatory or governmental authority as may, in the opinion of counsel for the
Company, be necessary or advisable in connection therewith. Any securities
delivered under the Plan shall be subject to such restrictions, and the person
acquiring such securities shall, if requested by the Company, provide such
assurances and representations to the Company as the Company may deem necessary
or desirable to assure compliance with all applicable legal requirements. To the
extent permitted by applicable law, the Plan and Awards granted or awarded
hereunder shall be deemed amended to the extent necessary to conform to such
laws, rules and regulations.

12.7 Titles and Headings, References to Sections of the Code or Exchange Act.
The titles and headings of the Sections in the Plan are for convenience of
reference only and, in the event of any conflict, the text of the Plan, rather
than such titles or headings, shall control. References to sections of the Code
or the Exchange Act shall include any amendment or successor thereto.

12.8 Governing Law. The Plan and any agreements hereunder shall be administered,
interpreted and enforced under the internal laws of the State of Delaware
without regard to conflicts of laws thereof.

12.9 Section 409A. If any distribution or settlement of an Award pursuant to the
terms of this Plan or an Award Agreement would subject a Holder to tax under
Section 409A of the Code (“Section 409A”), the Company may modify the Plan or
applicable Award Agreement in the least restrictive manner necessary in order to
comply with the provisions of Section 409A, other applicable provision(s) of the
Code and/or any rules, regulations or other regulatory guidance issued under
such statutory provisions and, in each case, without any material diminution in
the value of the payments to an affected Holder. Any settlement of Awards
subject to Section 409A in connection with a Change in Control shall be
effectuated in a manner that complies with the requirements of Section 409A.

12.10 No Rights to Awards. No Eligible Individual or other person shall have any
claim to be granted any Award pursuant to the Plan, and neither the Company nor
the Administrator is obligated to treat Eligible Individuals, Holders or any
other persons uniformly.

12.11 Unfunded Status of Awards. The Plan is intended to be an “unfunded” plan
for incentive compensation. With respect to any payments not yet made to a
Holder pursuant to an Award, nothing contained in the Plan or any Award
Agreement shall give the Holder any rights that are greater than those of a
general creditor of the Company or any Subsidiary.

12.12 Indemnification. To the extent allowable pursuant to applicable law, each
member of the Committee or of the Board shall be indemnified and held harmless
by the Company from any loss, cost, liability, or expense that may be imposed
upon or reasonably incurred by such member in connection with or resulting from
any claim, action, suit, or proceeding to which he or she may be a party or in
which he or she may be involved by reason of any action or failure to act
pursuant to the Plan and against and from any and all amounts paid by

 

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him or her in satisfaction of judgment in such action, suit, or proceeding
against him or her; provided he or she gives the Company an opportunity, at its
own expense, to handle and defend the same before he or she undertakes to handle
and defend it on his or her own behalf. The foregoing right of indemnification
shall not be exclusive of any other rights of indemnification to which such
persons may be entitled pursuant to the Company’s Certificate of Incorporation
or Bylaws, as a matter of law, or otherwise, or any power that the Company may
have to indemnify them or hold them harmless.

12.13 Relationship to other Benefits. No payment pursuant to the Plan shall be
taken into account in determining any benefits under any pension, retirement,
savings, profit sharing, group insurance, welfare or other benefit plan of the
Company or any Subsidiary except to the extent otherwise expressly provided in
writing in such other plan or an agreement thereunder.

12.14 Expenses. The expenses of administering the Plan shall be borne by the
Company and its Subsidiaries.

 

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