Exhibit 10.36a

CONSTAR INTERNATIONAL INC.

ANNUAL INCENTIVE & MANAGEMENT STOCK PURCHASE PLAN

(As Amended and Restated Effective January 1, 2008)

 

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CONSTAR INTERNATIONAL INC.

ANNUAL INCENTIVE & MANAGEMENT STOCK PURCHASE PLAN

TABLE OF CONTENTS

 

ARTICLE I PURPOSES AND EFFECTIVE DATE    1     1.1.      Purposes.    1     1.2.
     Effective Date.    2 ARTICLE II DEFINITIONS    2 ARTICLE III ELIGIBILITY   
10     3.1.      Eligibility.    10 ARTICLE IV AWARD DETERMINATION    11
    4.1.      Performance Goals.    11     4.2.      Objective Compensation
Formula.    12     4.3.      Award Opportunities.    12     4.4.      Adjustment
of Performance Goals.    12     4.5.      Final Award Determinations.    13
    4.6.      Limitations.    13 ARTICLE V PAYMENT OF BONUS AWARDS    13
    5.1.      Form and Timing of Payment.    13     5.2.      Payment of Partial
Awards.    14 ARTICLE VI CONTRIBUTIONS    14     6.1.      Bonus Deferrals.   
14     6.2.      Matching Contributions.    15 ARTICLE VII ACCOUNT
ADMINISTRATION    15     7.1.      Deferral Sub-Accounts.    15     7.2.     
Matching Sub-Accounts.    15     7.3.      Dividends.    15     7.4.      Stock
Adjustments.    16     7.5.      No Stockholders’ Rights.    16 ARTICLE VIII
VESTING    16     8.1.      Bonus Deferrals.    16     8.2.      Matching
Contributions.    16     8.3.      Change in Control.    17 ARTICLE IX
DISTRIBUTIONS    17     9.1.      Distribution of Bonus Deferrals.    17

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    9.2.      Normal Distribution of Matching Contributions.    18     9.3.     
Deferral of Matching Contributions.    18     9.4.      Distributions on
Termination of Employment.    18     9.5.      Distributions Upon a Change in
Control.    19     9.6.      Valuation and Manner of Distributions.    19
    9.7.      Certain Permitted Delays.    20 ARTICLE X FUNDING    20 ARTICLE XI
ADMINISTRATION    21     11.1.      Administration.    21     11.2.     
Administrative Review.    22     11.3.      General.    22 ARTICLE XII CLAIMS
PROCEDURE    22     12.1.      Initial Claim.    22     12.2.      Procedure for
Review.    23     12.3.      Claim Denial Procedure.    23     12.4.      Appeal
Procedure.    24     12.5.      Decision on Appeal.    24 ARTICLE XIII AMENDMENT
AND TERMINATION    25 ARTICLE XIV MISCELLANEOUS    26     14.1.     
Non-Guarantee of Employment.    26     14.2.      Rights of Participants to
Benefits.    26     14.3.      No Assignment.    26     14.4.      Withholding.
   26     14.5.      Account Statements.    27     14.6.      Gender.    27
    14.7.      Titles.    27     14.8.      Severability.    27     14.9.     
Successors.    27     14.10.      Governing Law.    27     14.11.      Other
Plans.    28

 

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CONSTAR INTERNATIONAL INC.

ANNUAL INCENTIVE & MANAGEMENT STOCK PURCHASE PLAN

ARTICLE I PURPOSES AND EFFECTIVE DATE

1.1. Purposes. This is the Constar International Inc. Annual Incentive &
Management Stock Purchase Plan (the “Plan”), as amended and restated effective
January 1, 2008. The purposes of the Plan are to attract and retain
highly-qualified executives, to align executive and stockholder long-term
interests by creating a direct link between annual incentive executive
compensation and stockholder return and, if so determined by the Committee (as
defined below), to enable executives to acquire stock so that they may develop
and maintain a substantial stock ownership position in the Company. The Plan is
an unfunded plan that is not intended to be (a) subject to Parts 2, 3 or 4 of
Title I, Subtitle B of the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”) or (b) qualified under section 401(a) of the Code.

1.2. Effective Date. The Plan became effective on January 1, 2003. This
amendment and restatement of the Plan is effective January 1, 2008. This
amendment and restatement of the Plan is intended to comply with Section 409A of
the Internal Revenue Code of 1986, as amended, (the “Code”) and is to be
construed in accordance with Code Section 409A and the regulations and guidance
thereunder. This amendment and restatement of the Plan shall apply only to
amounts deferred under the Plan which were not earned and vested prior to
January 1, 2005 and the provisions of this amendment and restatement shall be
effective as of January 1,

 

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2008. Amounts considered “earned and vested” (under Section 409A of the Code and
the regulations and other guidance issued thereunder) prior to January 1, 2005
shall continue to be subject to the terms of the Plan as written prior to
January 1, 2008.

ARTICLE II

DEFINITIONS

As used herein, the following terms shall have the following meanings:

2.1. “Account” means the bookkeeping reserve account established and maintained
for each Participant for purposes of determining the amount payable to the
Participant pursuant to the Plan; each Account shall consist of a Deferral
Sub-Account, a Matching Sub-Account and such other subaccounts as are necessary
or desirable in the opinion of the Committee for the convenient administration
of the Plan. The establishment of an Account shall not require segregation of
any funds of the Company or any Participating Employer or provide any
Participant with any rights to any assets of the Company or any Participating
Employer, except as a general creditor thereof. A Participant shall have no
right to receive payment of any amount credited to the Participant’s Account
except as expressly provided under the Plan.

2.2. “Approved Distribution Date” means a date at least five years after a
Participant’s Normal Distribution Date that has been approved by the Committee
on which distribution of the value of a Tranche of Restricted Stock Units will
be made in accordance with Section 9.3.

 

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2.3. “Award Opportunity” means the various levels of incentive awards, which a
Participant may earn under the Plan, as established by the Committee pursuant to
Article IV.

2.4. “Base Salary” means the regular base salary earned by a Participant during
the Plan Year prior to any salary reduction contributions made to any of the
Company’s or any Participating Employer’s deferred compensation plans, except as
otherwise determined by the Committee in its sole discretion.

2.5. “Beneficiary” means the person(s), trust(s) or other entities, the
Participant designates, in accordance with procedures established by the
Committee, to receive any benefits under the Plan after the death of the
Participant. If the Participant has not designated a Beneficiary, or if no
Beneficiary survives the Participant, the aggregate amount then credited to the
Participant’s Account shall be paid in a single sum to the Participant’s estate.

2.6. “Board” means the Board of Directors of the Company or, if the Board so
directs, the Committee acting on behalf of the Board in the exercise of any and
all powers and duties of the Board pursuant to this Plan.

2.7. “Bonus” means the annual performance bonus payable by a Participating
Employer to a Participant under the Plan, as determined by the Committee after
the end of such Plan Year. To be eligible to receive a Bonus, a Participant must
be employed by a Participating Employer as of January 1 of the Plan Year
following the Plan Year during which such Bonus is earned.

 

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2.8. “Cause” means (a) a Participant, in carrying out his duties for the
Participating Employer, engages in gross misconduct or gross negligence
resulting in a material adverse effect on the Participating Employer, (b) a
Participant embezzles any amount of the Participating Employer’s assets, (c) a
Participant is convicted (including a plea of guilty or nolo contendere) of a
felony involving moral turpitude, (d) a Participant’s breach of any restrictive
covenant agreed to with the Participating Employer, or (e) a Participant’s
willful and material failure to follow the lawful instructions of the Board. For
purposes of this Section 2.8, no act, or failure to act, on the Participant’s
part shall be considered “willful” unless done, or omitted to be done, by him in
bad faith and without reasonable belief that his action or omission was in the
best interest of the Participating Employer. Any act or omission to act by the
Participant in reliance upon an opinion of counsel to the Participating Employer
shall not be deemed to be willful.

2.9. “Change in Control” means:

(a) the acquisition by an individual, entity or group (within the meaning of
Section 13(d)(3) or 14(d)(2) of the Exchange Act), during any 12-month period
ending on the date of the most recent acquisition by such individual, entity or
group, of beneficial ownership (within the meaning of Rule 13d-3 promulgated
under the Exchange Act) of more than 30% of the total voting power of the voting
securities of the Company entitled to vote generally in the election of
directors (the “Voting Securities”); provided, however, that the following
acquisitions shall not constitute a Change in Control: (a) any acquisition,
directly or indirectly by or from the Company or any Subsidiary, or by any
employee benefit plan (or

 

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related trust) sponsored or maintained by the Company or any Subsidiary, (b) any
acquisition by any underwriter in connection with any firm commitment
underwriting of securities to be issued by the Company, or (c) any acquisition
by any corporation if, immediately following such acquisition, 70% or more of
the then outstanding shares of common stock of such corporation and the combined
voting power of the then outstanding voting securities of such corporation
(entitled to vote generally in the election of directors), are beneficially
owned, directly or indirectly, by all or substantially all of the individuals
and entities who, immediately prior to such acquisition, were the beneficial
owners of the then outstanding Stock of the Company and the Voting Securities in
substantially the same proportions, respectively, as their ownership,
immediately prior to such acquisition, of the Stock and Voting Securities; or

(b) The occurrence, during any 12-month period, of a reorganization, merger or
consolidation, other than a reorganization, merger or consolidation with respect
to which all or substantially all of the individuals and entities who were the
beneficial owners, immediately prior to such reorganization, merger or
consolidation, of the Stock and Voting Securities beneficially own, directly or
indirectly, immediately after such reorganization, merger or consolidation 70%
or more of the then outstanding common stock and voting securities (entitled to
vote generally in the election of directors) of the corporation resulting from
such reorganization, merger or consolidation in substantially the same
proportions as their respective ownership, immediately prior to such
reorganization, merger or consolidation, of the Stock and Voting Securities; or

 

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(c) The sale or other disposition, during any 12-month period ending on the date
of the most recent sale or disposition, of assets of the Company that have a
total gross fair market value equal to or more than 40% of the total gross fair
market value of all of the assets of the Company immediately before such sale or
disposition, other than to a subsidiary, wholly-owned, directly or indirectly,
by the Company or to a holding company of which the Company is a direct or
indirect wholly owned subsidiary prior to such transaction; or

(d) During any period of 12 consecutive months, the individuals at the beginning
of any such period who constitute the Board and any new director (other than a
director designated by a person or entity who has entered into an agreement with
the Company or other person or entity to effect a transaction described in
Sections 2.9(a), (b) or (c) above) whose election by the Board or nomination for
election by the Company’s stockholders was approved by a vote of a majority of
the directors then still in office who either were directors at the beginning of
any such period or whose election or nomination for election was previously so
approved, cease for any reason to constitute a majority of the Board.

2.10. “Code” means the Internal Revenue Code of 1986, as amended.

2.11. “Committee” means the Compensation Committee of the Board, provided that,
with respect to awards intended to qualify as “performance-based compensation”
under Section 162(m) of the Code, such committee shall consist of two (2) or
more individuals who are “outside directors” within the meaning of
Section 162(m) of the Code, as amended from time to time.

 

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2.12. “Company” means Constar International Inc., a corporation organized under
the laws of the State of Delaware, or any successor corporation.

2.13. “Disability” means the Employee is (a) unable to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment that can be expected to result in death or can be expected to last
for a continuous period of not less than 12 months, or (b) by reason of any
medically determinable physical or mental impairment that can be expected to
result in death or can be expected to last for a continuous period of not less
than 12 months, receiving income replacement benefits for a period of not less
than three months under an accident and health plan of the applicable
Participating Employer. Notwithstanding the foregoing, if the Participating
Employer maintains an accident and health plan, only subparagraph (b) hereof
shall apply in determining whether an Employee is considered disabled for the
purposes of this Plan.

2.14. “Employee” means an officer or other key employee of a Participating
Employer including a director who is such an employee.

2.15. “Employer” means the Company and any other entity included with the
Company in a controlled group of corporations or trades or businesses within the
meaning of Section 414(b) or Section 414(c) of the Code, provided that, for
purposes of Section 2.26 hereof, in applying Code Section 1563(a)(1), (2), and
(3) for purposes of determining a controlled group of corporations under Code
Section 414(b), the language “at least 50 percent” is used instead of “at least
80 percent” each place it appears in Code Section 1563(a)(1), (2), and (3), and
in applying Treasury Regulation §1.414(c)-2 for purposes of determining trades
or businesses

 

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(whether or not incorporated) that are under common control for purposes of Code
Section 414(c), “at least 50 percent” is used instead of “at least 80 percent”
each place it appears in Treasury Regulation §1.414(c)-2.

2.16. “Exchange Act” means the Securities Exchange Act of 1934, as amended.

2.17. “Fair Market Value” means on any given date, the closing price of a share
of Stock on the principal national securities exchange on which the Stock is
listed on such date or, if the Stock was not traded on such date, on the last
preceding day on which the Stock was traded. If at any time such Stock is not
listed on any securities exchange, the Fair Market Value shall be the fair value
of such Stock as determined in good faith by the Committee, in accordance with
applicable law.

2.18. “Matching Contribution” means amounts credited to a Participant’s Account
pursuant to Section 6.2.

2.19. “Normal Distribution Date” means the third anniversary of the date on
which an amount is credited to a Participant’s Matching Sub-Account under
Section 6.2 and on which distribution of the value of a Tranche of Restricted
Stock Units will be made in accordance with Section 9.2.

2.20. “Participant” means an Employee who is participating in the Plan pursuant
to Article III.

2.21. “Participating Employer” means the Company and any Subsidiary, unless such
Subsidiary is excluded as a Participating Employer by the Board, and any
organization into which a Participating Employer may be merged or consolidated
or to which all or substantially all of its assets may be transferred.

 

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2.22. “Plan” means the Constar International Inc. Annual Incentive & Management
Stock Purchase Plan as set forth herein and as amended from time to time.

2.23. “Plan Year” means the calendar year.

2.24. “Restricted Stock Unit” means a notional entry that is entered in a
Participant’s Account which represents the value of one share of Stock in
accordance with the terms of this Plan.

2.25. “Retirement” means, with respect to any Participant, Separation from
Service after attainment of an age regarded by the Participating Employer as the
normal retirement age for its employees in general, based upon the Participating
Employer’s general employment and related policies and practices.

2.26. “Separation from Service” means a Participant’s termination of employment
with the Employer that meets the requirements of a “separation from service” as
defined under Section 409A of the Code and the regulations and other guidance
thereunder.

2.27. “Specified Employee” means, for any 12-month period beginning on April 1
and ending on the following March 31, a Participant who, as of the preceding
December 31, was (i) an officer of an Employer having annual compensation (as
defined in Section 414(q)(4) of the Code) greater than $130,000 (as adjusted
under Section 416(i)(1) of the Code), (ii) a “five-percent owner” of an Employer
(as defined in Section 416(i)(1)(B) of the Code), or

 

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(iii) a person having annual compensation (as defined in Section 414(q)(4) of
the Code) of more than $150,000 and who would be classified as a “five-percent
owner” of an Employer under Section 416(i)(1)(B) of the Code if “one percent”
were substituted for “five percent” each time it appears in the definition of
such term.

2.28. “Stock” means the common stock of the Company, par value $.01 per share,
or such other class or kind of shares or other securities designated by the
Committee.

2.29. “Stock Plan” means the Constar International Inc. 2007 Stock-Based
Incentive Compensation Plan, as amended from time to time.

2.30. “Subsidiary” means any corporation (other than the Company) in an unbroken
chain of corporations beginning with the Company (or any subsequent parent of
the Company) if each of the corporations other than the last corporation in the
unbroken chain owns stock possessing 50% or more of the total combined voting
power of all classes of stock in one of the other corporations in such chain.

2.31. “Target Incentive Award” means the award to be paid to a Participant when
100% of performance measures are achieved, as established by the Committee.

2.32. “Tranche” means the amount of Restricted Stock Units credited to a
Participant’s Account during any one Plan Year.

2.33. “Valuation Date” means the business day used for purposes of valuing the
Restricted Stock Units credited to a Participant’s Account prior to a
distribution described in Article IX.

 

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ARTICLE III

ELIGIBILITY

3.1. Eligibility. Each Employee who is selected by the Committee shall be
eligible to become a Participant as of the date designated by the Committee. A
designated Employee shall remain eligible until such time as the Committee
affirmatively revokes such Employee’s eligibility.

ARTICLE IV

AWARD DETERMINATION

4.1. Performance Goals. Prior to the beginning of each Plan Year, or as soon as
practicable thereafter (but in no event more than ninety (90) days after the
beginning of such Plan Year), the Committee shall, in its sole discretion,
approve or establish in writing the performance goals for that Plan Year. For
any performance period that is less than twelve months, the performance goals
shall be established before twenty-five percent (25%) of the relevant
performance period has lapsed.

The performance goals may include, without limitation, any combination of
financial, non-financial and individual performance goals, as determined by the
Committee, based upon: (i) the price of Stock, (ii) the market share of the
Company or its Subsidiaries (or any business unit thereof), (iii) sales by the
Company or its Subsidiaries (or any business unit thereof), (iv) earnings per
share of Stock, (v) return on shareholder equity of the Company, (vi) costs of
the Company or its Subsidiaries (or any business unit thereof), (vii) cash flow
of the

 

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Company or its Subsidiaries (or any business unit thereof), (viii) return on
total assets of the Company or its Subsidiaries (or any business unit thereof),
(ix) return on invested capital of the Company or its Subsidiaries (or any
business unit thereof), (x) return on net assets of the Company or its
Subsidiaries (or any business unit thereof), (xi) operating income of the
Company or its Subsidiaries (or any business unit thereof), (xii), earnings
before interest, taxes, depreciation and amortization (“EBITDA”), including
EBITDA as may be adjusted pursuant to the Company’s or a Subsidiary’s credit
agreements or otherwise, (xiii) individual goals or (xiv) net income of the
Company or its Subsidiaries (or any business unit thereof). The Committee shall
have discretion to determine the specific targets with respect to each of these
categories of performance goals. Before payment of a Bonus, the Committee shall
certify that an individual has satisfied the applicable performance goal.

With respect to awards not intended to qualify as “performance-based
compensation” under Section 162(m) of the Code, the Committee also shall have
the authority to exercise subjective discretion in the determination of final
awards, as well as the authority to delegate the ability to exercise subjective
discretion in this respect.

The performance period with respect to which awards may be payable under the
Plan shall generally be the Plan Year; provided, however, that the Committee
shall have the authority and discretion to designate different performance
periods under the Plan.

Employees who are eligible to participate in the Plan shall be notified of the
performance goals and the related Award Opportunities for the relevant Plan Year
(or other performance period), as soon as practicable.

 

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4.2. Objective Compensation Formula. Prior to the beginning of each Plan Year,
or as soon as practicable thereafter (but in no event more than ninety (90) days
after the beginning of such Plan Year), the Committee shall approve or establish
in writing the objective compensation formula or standard for that Plan Year.
Such objective compensation formula or standard shall be the method for
computing the amount of compensation payable to the Participant if the
performance goals are attained. The formula or standard is objective if a third
party having knowledge of the relevant performance results could calculate the
amount to be paid to a Participant.

4.3. Award Opportunities. Prior to the beginning of each Plan Year, or as soon
as practicable thereafter (but in no event more than ninety (90) days after the
beginning of such Plan Year), the Committee shall establish an Award Opportunity
for each Participant. Such Award Opportunity may vary in relation to the job
classification of each Participant. In the event a Participant changes job
levels during a Plan Year, the Participant’s Award Opportunity may be adjusted
to reflect the amount of time at each job level during the Plan Year.

4.4. Adjustment of Performance Goals. The Committee shall have the right to
adjust the performance goals and the Award Opportunities (either up or down)
during a Plan Year. Notwithstanding the foregoing, if awards are intended to
qualify as “performance-based compensation” under Section 162(m) of the Code,
such adjustment shall only be made to the extent permitted by Code
Section 162(m) and the regulations and interpretative rulings thereunder, if the
Committee determines that external changes or other unanticipated business
conditions have materially affected the fairness of the goals and have unduly
influenced the

 

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Participating Employer’s ability to meet them. Further, in the event of a Plan
Year of less than twelve (12) months, the Committee shall have the right to
adjust the performance goals and the Award Opportunities accordingly.

4.5. Final Award Determinations. At the end of each Plan Year, Bonuses shall be
computed for each Participant as determined by the Committee. Each such award
shall be based upon (a) the Participant’s Target Incentive Award percentage (or
such greater or lesser percentage, as appropriate), multiplied by his Base
Salary, in whole or in part (or other preestablished objective compensation
formula in accordance with Section 4.2), and (b) the attainment of financial,
non-financial and individual performance goals. In the event that a Participant
is not employed by the Participating Employer at the end of a Plan Year, no
Bonus shall be payable for such Plan Year.

4.6. Limitations. A Participant’s Bonus (irrespective of any interest crediting
under Section 7.1 or any Matching Contribution as provided under Section 6.2)
with respect to any Plan Year shall not exceed 150 percent of the Participant’s
Base Salary.

ARTICLE V

PAYMENT OF BONUS AWARDS

5.1. Form and Timing of Payment. As soon as practicable following receipt of the
audited financial statements with respect to each Plan Year, the Committee shall
certify in writing the extent to which the Company (or any Subsidiary or
business unit thereof) and/or each Participant has achieved the performance
goals for such Plan Year, including the specific target

 

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objective(s) and the satisfaction of any other material terms of the awards, and
the Committee shall calculate the amount of each Participant’s Bonus for the
relevant period. Fifty percent of each Bonus shall be paid to the Participant,
or to his estate in the case of death, in a single cash payment as soon as
practicable following the receipt of audited financial statements with respect
to each Plan Year, but in no event later than December 31 of the Plan Year
following the Plan Year during which such Bonus is earned. The remaining fifty
percent of each Bonus shall be credited to the Participant’s Deferral
Sub-Account pursuant to Article VI. The amount of any Bonus deferred with
respect to any Plan Year shall reduce the amount of such Bonus otherwise payable
to the Participant as of the date such payment otherwise would have been made,
and the amount of such reduction shall be allocated to the Participant’s
Deferral Sub-Account effective as of the date the applicable Bonus would
otherwise have been payable.

5.2. Payment of Partial Awards. In the event a Participant no longer meets the
eligibility criteria as set forth in the Plan during the course of a particular
Plan Year, the Committee may, in its sole discretion, compute and pay a partial
Bonus or no Bonus for the portion of the Plan Year that an Employee was a
Participant. Notwithstanding the foregoing, in order to receive any Bonus for a
Plan Year, such Participant shall be employed by a Participating Employer on
January 1 of the following Plan Year.

 

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ARTICLE VI

CONTRIBUTIONS

6.1. Bonus Deferrals. For each Plan Year, 50 percent of each Participant’s Bonus
shall be credited to the Participant’s Deferral Sub-Account as of the date on
which the Committee approves the payment of a Bonus to the Participant absent
deferral of such amount.

6.2. Matching Contributions. For each Plan Year, the Committee shall credit to
each Participant’s Matching Sub-Account an amount (in accordance with Article
VII) equal to 50 percent of the Participant’s Bonus credited to the
Participant’s Deferral Sub-Account for such Plan Year.

ARTICLE VII

ACCOUNT ADMINISTRATION

7.1. Deferral Sub-Accounts. All amounts credited to a Participant’s Deferral
Sub-Account shall be credited on a cash basis. The balance of a Participant’s
Deferral Sub-Account shall be credited with five percent (5%) annual interest on
a daily basis.

7.2. Matching Sub-Accounts. All amounts credited to a Participant’s Matching
Sub-Account shall be credited on the basis of Restricted Stock Units. The number
of Restricted Stock Units credited to a Participant’s Matching Sub-Account shall
be equal to the Participant’s total Matching Contributions for such Plan Year
divided by the Fair Market Value of the Stock as of the second trading day after
the Company’s first earnings release following the Committee’s approval of the
cash portion of the Bonus. Partial Restricted Stock Units of 0.5 or more will be
rounded upwards.

 

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7.3. Dividends. If during the period of time a Participant’s Matching
Sub-Account is credited with Restricted Stock Units, the Company pays a dividend
with respect to its Stock, the Participant shall be credited with additional
Restricted Stock Units in accordance with this Section. The number of additional
Restricted Stock Units credited to a Participant’s Matching Sub-Account pursuant
to this Section shall be calculated by dividing (a) the product of (i) the whole
number of Restricted Stock Units held in the Participant’s Matching Sub-Account
as of the date the dividend is paid times (ii) the amount of such dividend with
respect to each share of Stock, by (b) the Fair Market Value of the Stock on the
date such dividend is paid. Restricted Stock Units shall be credited to a
Participant’s Matching Sub-Account under this Section as of the date the
applicable dividend is paid.

7.4. Stock Adjustments. The Committee shall adjust each Participant’s Matching
Sub-Account as the Committee determines is appropriate to reflect any stock
dividend, stock split, combination of shares, merger, share exchange,
consolidation or any other change in the corporate structure of the Company or
the Stock.

7.5. No Stockholders’ Rights. The crediting of Restricted Stock Units to a
Participant’s Account shall not give any Participant any right or interest in
any shares of Stock that may be held from time to time in a rabbi trust incident
to the Plan or otherwise.

 

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ARTICLE VIII

VESTING

8.1. Bonus Deferrals. A Participant shall be fully vested in all amounts
(including interest) credited to his Deferral Sub-Account at all times.

8.2. Matching Contributions. Except as provided below, each Tranche of
Restricted Stock Units shall become vested on the applicable Normal Distribution
Date, provided the Participant remains in the continuous employment of the
Participating Employer until such date. If a Participant terminates employment
due to death or Disability prior to the applicable Normal Distribution Date with
respect to a Tranche of Restricted Stock Units, such Tranche shall become fully
vested. If a Participant terminates employment due to Retirement or is
involuntarily terminated by the Participating Employer without Cause prior to
the applicable Normal Distribution Date with respect to a Tranche of Restricted
Stock Units, such Tranche shall become vested on a pro-rata basis. Such pro rata
amount shall be calculated based upon the Participant’s fully completed years of
employment with the Participating Employer from the time such Tranche was
credited to the Participant’s Matching Sub-Account compared to the years of
employment that would have been completed from the time such Tranche was
credited to the Participant’s Account until the applicable Normal Distribution
Date. If a Participant voluntarily terminates employment (other than for
Retirement) or is terminated by the Participating Employer for Cause prior to
the applicable Normal Distribution Date with respect to a Tranche of Restricted
Stock Units, such Tranche shall be forfeited and the Participant shall have no
rights with respect to such Restricted Stock Units.

 

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8.3. Change in Control. Upon a Change in Control, all Restricted Stock Units
credited to a Participant’s Matching Sub-Account shall become immediately fully
vested.

ARTICLE IX

DISTRIBUTIONS

9.1. Distribution of Bonus Deferrals. Subject to Sections 9.4, 9.5 and 9.7, the
amount of each Bonus (together with interest credited on such Bonus) allocated
to a Participant’s Deferral Sub-Account shall be distributed to such Participant
upon the one-year anniversary of the date on which the amount was credited to
the Participant’s Deferral Sub-Account under Section 6.1.

9.2. Normal Distribution of Matching Contributions. Subject to Sections 9.4, 9.5
and 9.7, and in accordance with Section 9.6, the value of a Tranche of
Restricted Stock Units shall be distributed on the Normal Distribution Date,
unless the Committee has approved a subsequent distribution date in accordance
with Section 9.3.

9.3. Deferral of Matching Contributions. At least 12 months prior to the Normal
Distribution Date for a Tranche of Restricted Stock Units, a Participant may
request that a distribution from his or her Matching Sub-Account be paid on an
Approved Distribution Date in accordance with procedures established by the
Committee. Such an election is subject to the Committee’s approval and, if
approved by the Committee, will become irrevocable on the day that is 12 months
prior to the Normal Distribution Date. If the Committee fails to approve such
election by the date it would otherwise become irrevocable, such election shall
be void. The Approved Distribution Date shall be applicable to an entire Tranche
of Restricted Stock Units.

 

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9.4. Distributions on Termination of Employment. Upon a Participant’s Separation
from Service for any reason, the entire value of a Participant’s Deferral
Sub-Account shall be distributed in cash and the value of all vested Restricted
Stock Units shall be distributed in accordance with Section 9.6 as soon as
practicable. Notwithstanding the foregoing or any other provision of the Plan,
if the Participant is a Specified Employee when a payment would otherwise be
made, and such payment would otherwise subject the Participant to any tax,
interest or penalty imposed under Section 409A(a)(1)(B) of the Code (or any
regulations or any guidance promulgated thereunder or with respect to) if the
payment would be made within six months of the Participant’s Separation from
Service, then such payment shall not be made until the first day which is six
months after the date of the Participant’s Separation from Service.

9.5. Distributions Upon a Change in Control. Upon a Change in Control, the
entire value of a Participant’s Deferral Sub-Account shall be distributed in
cash and the value of all Restricted Stock Units shall be distributed in
accordance with Section 9.6 as soon as practicable.

9.6. Valuation and Manner of Distributions.

(a) The Valuation Date for distributions made on a Normal Distribution Date or
an Approved Distribution Date in accordance with Sections 9.2 and 9.3 shall be
such Normal Distribution Date or Approved Distribution Date, as applicable.

 

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(b) The Valuation Date for distributions made upon Separation from Service or
Change in Control in accordance with Sections 9.4 or 9.5, respectively, shall be
the date of the Participant’s Separation from Service or Change in Control, as
applicable.

(c) Distributions under this Plan with respect to a Participant’s Matching
Sub-Account shall be made in Stock issued under the Stock Plan, unless, the
Committee provides, in its sole discretion, for all or part of a Participant’s
distribution to be in cash (including for reasons of having insufficient Stock
available under the Stock Plan or the payment of any applicable withholding
taxes); provided, however, that no partial shares of Stock shall be distributed
and in lieu thereof cash shall be distributed. Distributions in Stock shall be
made by issuing Stock certificates for a number of shares equal to the vested
Restricted Stock Units to be distributed on the applicable Valuation Date.
Distributions in cash shall be in an amount equal to the number of vested full
and partial Restricted Stock Units in a Participant’s Matching Sub-Account,
which were not distributed in Stock in accordance with the prior sentence, times
the Fair Market Value of the Stock on the Valuation Date. Upon Distribution all
rights to any Restricted Stock Units shall be cancelled.

9.7. Certain Permitted Accelerations and Delays. Notwithstanding any other
provision of the Plan to the contrary, in the sole and absolute discretion of
the Committee, amounts payable hereunder may be accelerated or delayed to a date
or dates other than the dates specified under this Article IX only under
circumstances permitted under Section 409A of the Code.

 

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ARTICLE X

FUNDING

The obligations of the Company and other Participating Employers to distribute
benefits under this Plan shall be interpreted solely as an unfunded, contractual
obligation to distribute only those amounts credited to the Participant’s
Account pursuant to the terms of this Plan. Any assets set aside, including any
assets transferred to a rabbi trust or purchased by the Company or other
Participating Employer with respect to amounts payable under the Plan, shall be
subject to the claims of the Company’s or the Participating Employer’s general
creditors, and no person other than the Company or the Participating Employer
shall, by virtue of the provisions of the Plan, have any interest in such
assets. All amounts deferred pursuant to this Plan may, in the Committee’s
discretion, be transferred to a rabbi trust as soon as practicable after such
amounts are allocated to a Participant’s Account.

ARTICLE XI

ADMINISTRATION

11.1. Administration. The Plan will be administered by the Committee. The
Committee shall be the named fiduciary for purposes of the claims procedure
pursuant to Article XII and shall have authority to act to the full extent of
its absolute discretion to:

(a) interpret the Plan;

 

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(b) resolve and determine all disputes or questions arising under the Plan,
including the power to determine the rights of Participants and Beneficiaries,
and their respective benefits, and to remedy any ambiguities, inconsistencies or
omissions in the Plan;

(c) create and revise rules and procedures for the administration of the Plan
and prescribe such forms as may be required for Participants to make elections
under, and otherwise participate in, the Plan; and

(d) take any other actions and make any other determinations as it may deem
necessary and proper for the administration of the Plan.

Any expenses incurred in the administration of the Plan will be paid by the
Company and/or other Participating Employer.

11.2. Administrative Review. Except as the Committee may otherwise determine
(and subject to the claims procedure set forth in Article XII), all decisions
and determinations by the Committee shall be final and binding upon all
Participants and Beneficiaries.

11.3. General. The Committee shall be entitled to rely conclusively upon, and
shall be fully protected in any action or omission taken by it in good faith
reliance upon the advice or opinion of any persons, firms or agents retained by
it, including but not limited to accountants, actuaries, counsel and other
specialists. Nothing in this Plan shall preclude the Company or any other
Participating Employer from indemnifying the members of the Committee for all
actions under this Plan, or from purchasing liability insurance to protect such
persons with respect to the Plan.

 

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ARTICLE XII

CLAIMS PROCEDURE

The Committee shall administer a claims procedure as follows:

12.1. Initial Claim. A Participant or Beneficiary who believes himself entitled
to benefits under the Plan, or such individual’s authorized representative
acting on behalf of such individual (the “Claimant”), must make a claim for
those benefits by submitting a written notification of his or her claim of right
to such benefits. Such notification must be on the form and in accordance with
the procedures established by the Committee.

12.2. Procedure for Review. The Committee shall establish administrative
processes and safeguards to ensure that all claims for benefits are reviewed in
accordance with the Plan document and that, where appropriate, Plan provisions
have been applied consistently to similarly situated Claimants.

12.3. Claim Denial Procedure. If a claim is wholly or partially denied, the
Committee shall notify the Claimant within a reasonable period of time, but not
later than 90 days after receipt of the claim, unless the Committee determines
that special circumstances require an extension of time for processing the
claim. If the Committee determines that an extension of time for processing is
required, written notice of the extension shall be furnished to the Claimant
prior to the termination of the initial 90-day period. In no event shall such

 

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extension exceed a period of 180 days from receipt of the claim. The extension
notice shall indicate: (a) the special circumstances necessitating the extension
and (b) the date by which the Committee expects to render a benefit
determination. A benefit denial notice shall be written in a manner calculated
to be understood by the Claimant and shall set forth: (a) the specific reason or
reasons for the denial, (b) the specific reference to the Plan provisions on
which the denial is based, (c) a description of any additional material or
information necessary for the Claimant to perfect the claim, with reasons
therefore, and (d) the procedure for reviewing the denial of the claim and the
time limits applicable to such procedures, including a statement of the
Claimant’s right to bring a legal action under section 502(a) of ERISA following
an adverse benefit determination on review.

12.4. Appeal Procedure. In the case of an adverse benefit determination, the
Claimant shall have the opportunity to appeal to the Committee for review
thereof by requesting such review in writing to the Committee within 60 days of
receipt of notification of the denial. Failure to submit a proper application
for appeal within such 60 day period will cause such claim to be permanently
denied. The Claimant shall be provided, upon request and free of charge,
reasonable access to, and copies of, all documents, records and other
information relevant to the claim. A document, record or other information shall
be deemed “relevant” to a claim in accordance with 29 C.F.R. §2560.503-1(m)(8).
The Claimant shall also be provided the opportunity to submit written comments,
documents, records and other information relating to the claim for benefits. The
Committee shall review the appeal taking into account all comments, documents,
records and other information submitted by the Claimant relating to the claim,
without regard to whether such information was submitted or considered in the
initial benefit determination.

 

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12.5. Decision on Appeal. The Committee shall notify a Claimant of its decision
on appeal within a reasonable period of time, but not later than 60 days after
receipt of the Claimant’s request for review, unless the Committee determines
that special circumstances require an extension of time for processing the
appeal. If the Committee determines that an extension of time for processing is
required, written notice of the extension shall be furnished to the Claimant
prior to the termination of the initial 60-day period. In no event shall such
extension exceed a period of 60 days from the end of the initial period. The
extension notice shall indicate: (a) the special circumstances necessitating the
extension and (b) the date by which the Committee expects to render a benefit
determination. An adverse benefit decision on appeal shall be written in a
manner calculated to be understood by the Claimant and shall set forth: (a) the
specific reason or reasons for the adverse determination, (b) the specific
reference to the Plan provisions on which the denial is based, (c) a statement
that the Claimant is entitled to receive, upon request and free of charge,
reasonable access to and copies of all documents, records, and other information
relevant to the Claimant’s claim (the relevance of a document, record or other
information will be determined in accordance with 29 C.F.R. §2560-1(m)(8)) and
(d) a statement of the Claimant’s right to bring a legal action under section
502(a) of ERISA.

 

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ARTICLE XIII

AMENDMENT AND TERMINATION

13.1. The Board or the Committee shall have the right to modify or amend the
Plan at any time and from time to time, and the Board shall have the right to
discontinue or terminate the Plan at any time and from time to time; provided,
however, that no modification, amendment, discontinuance or termination may,
without the consent of a Participant, adversely affect the rights of such
Participant to amounts previously credited to his Account or reduce the right of
such Participant to a payment or distribution hereunder which he has already
earned and to which he is otherwise entitled. In the event of a Plan
termination, amounts to which a Participant may be entitled shall be paid in
accordance with the Plan’s provisions in effect immediately prior to such
termination, provided that the Company may accelerate payments to the extent
permitted under Section 409A of the Code.

ARTICLE XIV

MISCELLANEOUS

14.1. Non-Guarantee of Employment. Participation in the Plan does not give any
Employee any right to be retained in the service of the Participating Employer.
Nothing in the Plan shall interfere with or limit in any way the right of the
Company to terminate a Participant’s employment at any time.

14.2. Rights of Participants to Benefits. All rights of a Participant under the
Plan to amounts credited to the Participant’s Account are mere unsecured
contractual rights of

 

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the Participant (or his or her Beneficiary) against the Employer. Each Employer
shall be primarily responsible for payment of benefits hereunder to the
Participants it employs and the Beneficiaries of such Participants. In the event
a Participating Employer fails to pay any amount due under this Plan for any
reason, the Company shall be jointly and severally liable for the payment of
such amount.

14.3. No Assignment. No amounts credited to Accounts nor any rights or benefits
under the Plan shall be subject in any way to voluntary or involuntary
alienation, sale, transfer, assignment, pledge, attachment, garnishment,
execution, or encumbrance, and any attempt to accomplish the same shall be void.

14.4. Withholding. The Company or other Participating Employer shall have the
right to deduct from any distribution made hereunder any taxes required by law
to be withheld from a Participant with respect to such payment, and, shall have
the right, in accordance with Section 7.6(c), to require that a portion of a
Participant’s Account distribution be paid in cash in order to satisfy such
withholding obligations.

14.5. Account Statements. Periodically (as determined by the Committee), each
Participant shall receive a statement indicating the amounts credited to and
payable from the Participant’s Account.

14.6. Gender. The masculine shall be read in the feminine, the singular in the
plural, and vice versa, whenever the context shall so require.

 

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14.7. Titles. The titles to articles and sections in this Plan are placed herein
for convenience of reference only, and the Plan is not to be construed by
reference thereto.

14.8. Severability. In the event any provision of the Plan shall be held illegal
or invalid for any reason, the illegality or invalidity shall not affect the
remaining parts of the Plan and the Plan shall be construed and enforced as if
the illegal or invalid provision had not been included.

14.9. Successors. All obligations of the Company under the Plan shall be binding
upon and inure to the benefit of any successor to the Company, whether the
existence of such successor is the result of a direct or indirect purchase,
merger, consolidation, or otherwise, of all or substantially all of the business
and/or assets of the Company.

14.10. Governing Law. Except to the extent preempted by applicable federal laws,
the Plan shall be construed according to the laws of the state of Delaware,
other than its conflict of laws principles.

14.11. Other Plans. Except as specifically provided herein, nothing in this Plan
shall be construed to affect the rights of a Participant, a Participant’s
Beneficiaries, or a Participant’s estate to receive any retirement or death
benefit under any tax-qualified or nonqualified pension plan, deferred
compensation agreement, insurance agreement or other retirement plan of the
Employer.

 

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To record the adoption of the Plan, Constar International Inc. has caused its
authorized representative to affix its corporate name effective as of the day
and year first written above.

 

CONSTAR INTERNATIONAL INC. By:  

A. Alexander Taylor

Title:   Chairman of Compensation Committee

 

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