Exhibit 10.1

GEORGIA GULF CORPORATION
EXECUTIVE AND KEY EMPLOYEE
CHANGE OF CONTROL SEVERANCE PLAN

Effective as of May 15, 2007

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TABLE OF CONTENTS

 

 

 

Page

 

 

 

 

 

SECTION 1

 

DEFINITIONS

 

1

 

 

 

 

 

SECTION 2

 

PARTICIPATION

 

6

 

 

 

 

 

SECTION 3

 

ELIGIBILITY FOR BENEFITS

 

7

 

 

 

 

 

SECTION 4

 

SEVERANCE BENEFITS AFTER A CHANGE OF CONTROL

 

8

 

 

 

 

 

SECTION 5

 

TAX ADJUSTMENTS

 

10

 

 

 

 

 

SECTION 6

 

OTHER SEVERANCE BENEFITS UNDER OTHER PROGRAMS OR UNDER LAW

 

14

 

 

 

 

 

SECTION 7

 

ADMINISTRATION

 

15

 

 

 

 

 

SECTION 8

 

MISCELLANEOUS

 

18

 

 

 

 

 

SECTION 9

 

AMENDMENT OR TERMINATION OF THE PLAN

 

22

 

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GEORGIA GULF CORPORATION
EXECUTIVE AND KEY EMPLOYEE
CHANGE OF CONTROL SEVERANCE PLAN

Effective as of May 15, 2007

Section 1

Definitions

Capitalized terms used in the Plan and not elsewhere defined herein shall have
the meanings set forth in this Section:

1.1           “Agreement” shall mean a separation agreement and general release
in such form as the Employer, in its sole discretion, determines.

1.2           “Base Salary” shall mean the Participant’s rate of base pay on his
Termination Date, as reflected on the Employer’s payroll records, and not
including bonuses, overtime pay, compensatory time-off, commissions, incentive
or deferred compensation, employer contributions towards employee benefits, or
any other additional compensation.  For purposes of this Plan, a Participant’s
base pay or salary shall include any salary reduction contributions made on his
or her behalf to any plan of the Company or the Employer under Section 125,
132(f) or 401(k) of the Code.  Notwithstanding the foregoing, following a Change
of Control, Base Salary under this Plan shall not be less than the highest rate
of Base Salary during the 90-day period preceding the Change of Control.

1.3           “Board” shall mean the Board of Directors of Georgia Gulf
Corporation, or such person or group of persons (including without limitation a
Committee of such Board of Directors) to whom such Board of Directors delegates
responsibilities under this Plan.

1.4           “Business Combination” means a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of the Company.

1.5           “Cause” shall mean any of the following:

(a)           Any activity as an employee, principal, agent, or consultant for
another entity that competes, directly or indirectly, with the Company in any
actual, researched, or prospective product, service, system, or business
activity for which the Participant has had any direct or indirect responsibility
during the last five years of his or her employment with the Company or any
Subsidiary in any territory in which the Company or any Subsidiary manufactures,
sells, markets, services, or installs such product, service, system, or business
activity.

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(b)           The solicitation of any employee of the Company or any Subsidiary
to terminate his or her employment with the Company or such Subsidiary.

(c)           The disclosure to any person not employed by or serving as a
director of the Company or a Subsidiary, or the use in other than the Company’s
or a Subsidiary’s business, in each case without prior written authorization
from the Company, of any confidential, proprietary or trade secret information
or material relating to the business of the Company and/or its Subsidiaries,
acquired by the Participant either during employment with the Company or any
Subsidiary or while acting as a consultant for the Company or any Subsidiary.

(d)           The failure or refusal to disclose promptly and to assign to the
Company upon request all right, title and interest in any invention or idea,
patentable or not, made or conceived by the Participant during employment by the
Company or any Subsidiary, relating in any manner to the actual or anticipated
business, research or development work of the Company or any Subsidiary or the
failure or refusal to do anything reasonably necessary to enable the Company or
any Subsidiary to secure a patent where appropriate, whether in the United
States or in other countries.

(e)           Any other conduct or act determined to be injurious, detrimental
or prejudicial to any significant interest of the Company or any Subsidiary
unless the Participant acted in good faith and in a manner he or she reasonably
believed to be in or not opposed to the best interests of the Company.

1.6           “Change of Control” shall mean the occurrence of any of the
following events:

(a)           The acquisition by any Person of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of 33% or more of the
Voting Power of the Company; provided, however, that for purposes of this
subsection, the following acquisitions shall not constitute a Change of
Control:  (A) any acquisition directly from the Company, (B) any acquisition by
the Company or any Subsidiary, (C) any acquisition by any employee benefit plan
(or related trust) sponsored or maintained by the Company or any Subsidiary, or
(D) any acquisition by any Person pursuant to a transaction which complies with
clauses (i) and (ii) of subsection (c) of this Section 1.6.

(b)           A change in a majority of the members of the Board occurs: 
(i) within one year following the public announcement of an actual or threatened
election contest (as described in Rule 14a-12(c) promulgated under the Exchange
Act) or the filing of a Schedule 13D or other public announcement indicating
that a Person intends to effect a change in control of the Company, (ii) as a
result of the exercise of contractual rights, or (iii) as a result of a majority
of the members of the Board having been proposed, designated or nominated by a
Person (other than the Company through the Board or a committee of the Board).

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(c)           Consummation of a Business Combination unless, following such
Business Combination, (i) no Person (excluding any entity resulting from such 
Business Combination or any employee benefit plan (or related trust) sponsored
or maintained by the Company or such entity resulting from such Business
Combination or any Subsidiary of either of them) beneficially owns, directly or
indirectly, 33% or more of the Voting Power of the entity resulting from such
Business Combination, and (ii) at least half of the members of the board of
directors of the corporation resulting from such Business Combination were
members of the Board at the time of the execution of the initial agreement, or
of the action of the Board, providing for such Business Combination.

(d)           Approval by the stockholders of the Company of a complete
liquidation or dissolution of the Company.

(e)           Such other event as the Board may determine by express resolution
to constitute a Change of Control for purposes of this Plan.

1.7           “Code” shall mean the Internal Revenue Code of 1986, as amended.

1.8           “Company” shall mean Georgia Gulf Corporation, a Delaware
corporation.

1.9           “Eligible Employees” shall mean all Executive Officers and Key
Employees of Georgia Gulf Corporation.  Notwithstanding the foregoing, an
Eligible Employee shall not include any individual: (i) designated by the
Company as an independent contractor and not as an employee at the time of any
determination; (ii) being paid by or through an employee leasing company or
other third party agency; (iii) designated by the Company as a freelance worker
and not as an employee at the time of any determination; (iv) classified by the
Company as a seasonal, occasional, limited duration, or temporary employee,
during the period the individual is so paid or designated; (v) designated by the
Company as a leased employee, during the period the individual is so paid or
designated; or (vi) who is covered by a collective bargaining agreement.  Any
such individual shall not be an Eligible Employee even if he or she is later
retroactively reclassified as a common-law employee of the Company during all or
any part of such period pursuant to applicable law or otherwise.

1.10         “Employer” shall mean the Company and its Subsidiaries and
affiliates that participate in the Plan with the approval of the Board.

1.11         “ERISA” shall mean the Employee Retirement Income Security Act of
1974, as amended.

1.12         “Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder, as such law, rules and
regulations may be amended from time to time.

1.13         “Executive Officer” shall mean each active, full-time executive
officer of the Company, as designated from time to time by the Board.

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1.14         “Good Reason” shall mean: (i) the Employer reduces the
Participant’s compensation (base salary, bonus, or short-term and long-term
incentives) or (ii) any attempted relocation of the Participant’s place of
employment to a location more than 150 miles from the location of such
employment on the date of such attempted relocation, and such reduction or
relocation is not cured by the Employer within 15 days after the date the
Participant delivers a notice of termination for Good Reason.

1.15         “Involuntary Termination” shall mean the termination of a
Participant’s employment by the Employer for any reason; provided, however, that
an Involuntary Termination of a Participant’s employment shall not occur if:

(a)           the termination of the Participant’s employment is due to (i) the
transfer of the Participant to an affiliate or subsidiary of the Company, (ii)
the transfer of any operations of the Company or a subsidiary, operation,
section or division of the Company to an affiliate of the Company or an entity
unrelated to the Company (irrespective of whether assets of the Company or any
such subsidiary, operation, section or division are sold or transferred to such
unrelated entity), or (iii) the purchase of the Company or a subsidiary,
operation, section or division of the Company by a third party purchaser, and,
in each case, the Participant is offered comparable employment by the purchaser,
as determined by the Company in its sole discretion;

(b)           the Participant’s employment terminates on account of the
Participant’s (i) death, (ii) disability, as defined under the Company’s
long-term disability plan or (iii) retirement under a retirement plan of the
Company that is qualified under section 401(a) of the Code covering such
Participant;

(c)           the Participant’s employment is terminated for Cause; or

(d)           the Participant resigns his employment with the Employer or fails
to continue reporting to work and performing satisfactorily his job duties
through the Termination Date, unless the Employer agrees in writing to release
him earlier;

1.16         “Key Employee” shall mean each active, full-time employee
designated in writing by the Board.  For purposes of the Plan, a full-time
employee is an employee of the Company or an Employer who is regularly scheduled
to work at least 32 hours per week.

1.17         “Participant” shall mean an Eligible Employee who is designated for
participation as set forth in Section 2.

1.18         “Person” shall mean any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act).

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1.19         “Plan” shall mean this Georgia Gulf Corporation Executive And Key
Employee Change of Control Severance Plan.

1.20         “Plan Administrator” shall mean the designee of the Board.

1.21         “Plan Year” shall mean the calendar year; provided that the initial
Plan Year of the Plan shall begin on May 15, 2007 and end on December 31, 2007.

1.22         “Subsidiary” shall mean a corporation, company or other entity (i)
more than 50 percent of whose outstanding shares or securities (representing the
right to vote for the election of directors or other managing authority) are, or
(ii) which does not have outstanding shares or securities (as may be the case in
a partnership, joint venture, limited liability company, or unincorporated
association), but more than 50 percent of whose ownership interest representing
the right generally to make decisions for such other entity is, now or
hereafter, owned or controlled, directly or indirectly, by the Company.

1.23         “Termination” shall mean either an Involuntary Termination or a
Voluntary Termination.

1.24         “Termination Date” shall mean the effective date of the termination
of the Participant’s employment with the Employer as designated by the Employer
in writing in the case of an Involuntary Termination and the date specified in
the notice provided for in Section 3.3 in the case of Voluntary Termination.

1.25         “Voluntary Termination” shall mean the Participant’s resignation
from employment with the Employer for Good Reason within 24 months following a
Change of Control.

1.26         “Voting Power” shall mean at any time, the combined voting power of
the then-outstanding securities entitled to vote generally in the election of
Directors in the case of the Company, or members of the board of directors or
similar body in the case of another entity.

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Section 2

Participation

2.1           An Eligible Employee shall become a Participant in this Plan only
if he (i) is the Chief Executive Officer of the Company, or (ii) is an Executive
Officer or a Key Employee designated by the Board as a Participant in this Plan.

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Section 3

Eligibility for Benefits

3.1           Conditions for Eligibility.  Subject to the conditions and
limitations of this Section 3 and the other provisions in the Plan, a
Participant shall be entitled to the severance benefits described herein only
upon satisfaction of all the following conditions (and all other applicable
conditions contained herein):

(a)           he suffers a Termination,

(b)           he executes an Agreement without modification and in its entirety,
and he does not timely revoke the Agreement,

(c)           he returns to the Employer any property of the Company or the
Employer which has come into his possession, and

(d)           he remains actively at work through his Termination Date unless
the Employer agrees in writing to release the Participant from employment
earlier than the Termination Date.

3.2           Exclusions.  Each Participant shall cease to be entitled to
severance benefits, upon the earliest to occur of the following:

(a)           his breach of the Agreement or the invalidity or unenforceability
of such Agreement;

(b)           his engaging in any conduct which is described in the definition
of “Cause” in Section 1.5 of this Plan; or

(c)           his reemployment by the Company or an Employer.

3.3           Notice.  In the event that a Participant terminates his employment
for Good Reason, he shall provide to the Plan Administrator a written notice 30
days before his resignation date specifying the reason that the Employer’s act
or failure to act has, in the view of the Participant, given rise to his
termination for Good Reason.

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Section 4

Severance Benefits After a Change of Control

4.1           Benefits.  If a Participant experiences a Termination within 24
months following a Change of Control, and complies with all of the other terms
and conditions of the Plan, he shall be eligible to receive:

(a)           severance pay equal to the Participant’s annual Base Salary plus
the current target bonus in effect immediately prior to the Change of Control 
multiplied by the factor set forth in the following table:

Position of Participant

 

Factor

 

Chief Executive Officer

 

2.0

 

Executive Officer, other than Chief Executive Officer

 

1.5

 

Key Employee

 

1.0

 

 

(b)           a pro rata portion (as of  the Termination Date) of the current
target bonus that the Participant would be eligible to earn for the fiscal year
in which the Termination Date occurs calculated by assuming payment at 100% of
the target amount and basing such pro rata portion upon a fraction the numerator
of which is the number of days in the bonus period that have elapsed from the
beginning of the bonus period through the Termination Date and the denominator
of which is the total number of days in the bonus period;

(c)           the amount of the Participant’s accrued but unused vacation pay
under the Company’s vacation policy as of the Termination Date;

(d)           until the earlier of (i) the day upon which the Participant begins
new employment and is eligible for such welfare benefits, or (ii) (A) the second
anniversary of the Termination Date if the Participant is the Chief Executive
Officer; (B) the date which is 18 months after the Termination Date if the
Participant is an Executive Officer other than the Chief Executive Officer; or
(C) the first anniversary of the Termination Date if the Participant is a Key
Employee:

(i)            the Company shall continue to provide life insurance benefits
that are substantially equivalent to those which were provided to the
Participant and the Participant’s family immediately prior to the Termination
Date (or if greater, immediately prior to the Change of Control) in accordance
with the applicable plans, programs and policies of the Company;

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(ii)           the Company shall continue to maintain medical, dental and vision
benefit plans and programs substantially equivalent to those in effect on the
Termination Date and the Company shall pay to the Participant monthly amounts
that are calculated in such a way as to provide the Participant sufficient funds
(after payment of all applicable federal, state and local taxes) to pay the
required premium or contribution for continued coverage for the Participant and
the Participant’s family under the Company’s medical, dental, and vision benefit
plans and programs, pursuant to the Consolidated Omnibus Budget Reconciliation
Act of 1985; and

(iii)          the Company shall pay to the Participant an amount equal to the
premium required to obtain an individual policy of disability insurance (if such
individual insurance policy can be obtained in the private insurance market)
providing a benefit substantially equivalent to the benefit that applied to the
Participant immediately prior to the Termination Date.

4.2           Timing of Severance Benefits.  The severance benefits described in
Sections 4.1(a) through 4.1(c) shall be paid in a lump sum as soon as
administratively practicable but no more than 14 days following the effective
date of the Participant’s Agreement; provided, however, that if the Participant
is a “specified employee,” within the meaning of Section 409A(a)(2)(B)(i) of the
Code, then such lump sum payment shall be made 6 months and 1 day after
termination.  Severance benefits described in Section 4.1(d) shall commence to
be paid as soon as practicable following the effective date of the Participant’s
Agreement; provided, however, that in the case of reimbursements to a
Participant under Section 4.1(d)(ii) and (iii) such reimbursements shall be made
on or before the last day of the Participant’s taxable year following the
taxable year in which the Participant incurred the expense that is being
reimbursed.

4.3           Remployment of Participant.  If a Participant who is receiving
severance benefits is reemployed by the Company or breaches the Agreement,
payment of severance benefits shall immediately cease.  In the event that
severance benefits are paid in a lump sum, upon rehire by the Company, the
Participant shall be required to repay to the Company the portion of the total
severance benefits that would not have been paid to him if he had been receiving
his severance benefits in semi-monthly installments.

4.4           Death of Participant.  If a Participant dies prior to payment of
all severance benefits to which he is entitled, any unpaid severance benefits
shall be paid to the Participant’s surviving spouse or, if no spouse survives,
to the Participant’s estate.

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Section 5

Tax Adjustments

5.1           In General.

In the event that it shall be determined that any payment or benefit to be
provided by the Company to the Participant pursuant to the terms of the Plan or
any other payments or benefits received or to be received by the Participant (a
“Payment”) in connection with or as a result of a Change of Control or the
Participant’s termination of employment or any event which is deemed by the
Internal Revenue Service or any other taxing authority to constitute a change in
the ownership or effective control of the Company, or in the ownership of a
substantial portion of the assets of the Company (“Change of Control Payments”)
shall be subject to the tax (the “Excise Tax”) imposed by Section 4999 (or any
successor section) of the Code, the payments or benefits payable pursuant to the
terms of the Plan shall be reduced so that the Payment, in the aggregate, is
reduced to the greatest amount that could be paid to the Participant without
giving rise to any Excise Tax (the “Safe Harbor Amount”).  The reduction of the
amounts payable hereunder shall be made first by reducing the payments under
Section 4.1(a), unless an alternative method is elected by the Participant.

5.2           Executive Officers.

(a)           Notwithstanding the foregoing, and in lieu of the reduction
described above, if the Participant is an Executive Officer and the Payment is
at least 120% of the Safe Harbor Amount, the Company shall pay to such
Participant an additional amount (the “Gross-Up Payment”) such that the net
amount retained by the Participant, after (i) payment of any Excise Tax on the
Change of Control Payments and (ii) payment of any federal and state and local
income tax and Excise Tax upon the Gross-Up Payment, shall be equal to the
Change of Control Payments.

(b)           Subject to the provisions of subparagraph (f) below, all
determinations required to be made under this Section 5, including whether an
Excise Tax is payable by the Participant and the amount of that Excise Tax and
whether a Gross-Up Payment is required to be paid by the Company to the
Participant and the amount of that Gross-Up Payment, if any, will be made by a
nationally recognized accounting firm (the “Accounting Firm”) selected by the
Company and reasonably acceptable to the Participant.  For purposes of
determining the amount of the Gross-Up Payment (if any), the Participant shall
be deemed to pay federal income taxes at the highest marginal rate of federal
income taxation in the calendar year in which the Gross-Up Payment is to be made
and state and local income taxes at the highest marginal rate of taxation in the
calendar year in which the Gross-Up Payment is to be made in the state or
locality of the Participant’s residence on the Participant’s Termination Date. 
The Accounting Firm shall submit its determination and detailed supporting
calculations to both the Company and the Participant within 30 calendar days

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after the Participant’s receipt of the first Payment upon or following the
Change in Control, and any other time or times as may be requested by the
Company or the Participant.  If the Accounting Firm determines that any Excise
Tax is payable by the Participant, the Company will pay the required Gross-Up
Payment to the Participant within 5 business days after receipt of the
determination and calculations with respect to any Payment to the Participant;
provided, however, that this and all other payments under this Section 5 are
subject to any requirement for a delay in said payment(s) pursuant to
Section 409A of the Code.  If the Accounting Firm determines that no Excise Tax
is payable by the Participant, it will, at the same time as it makes that
determination, furnish the Company and the Participant an opinion that the
Participant has substantial authority not to report any Excise Tax on his
federal, state or local income or other tax return.  As a result of the
uncertainty in the application of Section 4999 of the Code (or any successor
provision) and the possibility of similar uncertainty regarding applicable state
or local tax law at the time of any determination by the Accounting Firm, it is
possible that Gross-Up Payments which will not have been made by the Company
should have been made (an “Underpayment”), consistent with the calculations
required to be made under this provision.  If the Company exhausts or fails to
pursue its remedies pursuant to subparagraph (f) and the Participant
subsequently is required to made a payment of any Excise Tax, the Participant
will direct the Accounting Firm to determine the amount of the Underpayment that
has occurred and to submit its determination and detailed supporting
calculations to both the Company and the Employee as promptly as possible.  Any
such Underpayment will be promptly paid by the Company to, or for the benefit
of, the Participant within 5 business days after receipt of the determination
and calculations.

(c)           The Company and the Participant will each provide the Accounting
Firm access to and copies of any books, records and documents in the possession
of the Company or the Participant, as the case may be, reasonably requested by
the Accounting Firm, and otherwise cooperate with the Accounting Firm in
connection with the preparation and issuance of the determinations and
calculations contemplated by subparagraph (b).  Any determination by the
Accounting Firm as to the amount of the Gross-Up Payment will be binding upon
the Company and the Participant.

(d)           The federal, state and local income or other tax returns filed by
the Participant will be prepared and filed on a consistent basis with the
determination of the Accounting Firm with respect to the Excise Tax payable by
the Participant.  The Participant will make proper payment of the amount of any
Excise Payment, and at the request of the Company, provide to the Company true
and correct copies (with any amendments) of his federal income tax return as
filed with the Internal Revenue Service and corresponding state and local tax
returns, if relevant, as filed with the applicable taxing authority, and those
other documents reasonably requested by the Company, evidencing that payment. 
If prior to the filing of the Participant’s federal income tax return, or
corresponding state or local tax return, if relevant, the Accounting firm
determines that the amount of the

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Gross-Up Payment should be reduced, the Participant shall within 5 business days
pay to the Company the amount of that reduction.

(e)           The reasonable fees and expenses of the Accounting Firm for its
services in connection with the determinations and calculations contemplated by
subparagraph (b) will be borne by the Company to the extent they are reasonable
by industry standards.  If those fees and expenses are initially paid by the
Participant, the Company will reimburse the Participant the full amount of those
fees and expenses within 5 business days after receipt from the Participant of a
statement for them and reasonable evidence of his payment of them.

(f)            The Participant will notify the Company in writing of any claim
by the Internal Revenue Service or any other taxing authority that, if
successful, would require the payment by the Company of a Gross-Up Payment. 
That notification will be given as promptly as practicable but no later than 10
business days after the Participant actually receives notice of that claim and
the Participant will further apprise the Company of the nature of that claim and
the date on which that claim is requested to be paid (in each case, to the
extent known by the Participant).  The Participant will not pay that claim prior
to the earlier of (i) the expiration of the 30-calendar-day period following the
date on which he gives that notice to the Company and (ii) the date that any
payment of an amount with respect to that claim is due.  If the Company notifies
the Participant in writing prior to the expiration of that period that it
desires to contest the claim, the Participant will:

(i)            provide the Company with any written records or documents in his
possession relating to that claim reasonably requested by the Company;

(ii)           take that action in connection with contesting the claim as the
Company reasonably requests in writing from time to time, including without
limitation accepting legal representation with respect to that claim by an
attorney or other tax professional competent in respect of the subject matter
and reasonably selected by the Company;

(iii)          cooperate with the Company in good faith in order effectively to
contest that claim; and

(iv)          permit the Company to participate in any proceedings related to
that claim;

provided, however, that the Company will bear and pay directly all costs and
expenses (including interest and penalties) incurred in connection with that
contest and will indemnify and hold harmless the Participant, on an after-tax
basis, for and against any Excise Tax or income tax, including interest and
penalties with respect to the Excise Tax, imposed as a result of that
representation and

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payment of costs and expenses.  Without limiting the foregoing provisions of
this subparagraph (f), the Company will control all proceedings taken in
connection with the contest of any claim contemplated by this subparagraph (f)
and, at its sole option, may pursue or forego any and all administrative
appeals, proceedings, hearings and conferences with the taxing authority in
respect of that claim (provided, however, that the Participant may participate
in them at his own cost and expense) and may, at its option, either direct the
Participant to pay the tax claimed and sue for a refund or contest the claim in
any permissible manner, and the Participant will prosecute that contest to a
determination before any administrative tribunal, in a court of initial
jurisdiction and in one or more appellate courts, as the Company will determine;
provided, however, that if the Company directs the Participant to pay the tax
claimed and sue for a refund, the Company will advance the amount of that
payment to the Participant on an interest-free basis and will indemnify and hold
harmless the Participant, on an after-tax basis, from any Excise Tax or directly
related income or other tax, including interest or penalties, imposed with
respect to that advance; and provided further, however, that any extension of
the statute of limitations relating to payment of taxes for the taxable year of
the Participant with respect to which the contested amount is claimed to be due
is limited solely to that contested amount.  Furthermore, the Company’s control
of any contested claim will be limited to issues with respect to which a
Gross-Up Payment would be payable hereunder and the Participant will be entitled
to settle or contest, as the case may be, any other issue raised by the Internal
Revenue Service or any other taxing authority.

(g)           If the Participant receives any refund with respect to such
contested claim filed at the Company’s request under Section 5.2(f), or
otherwise receives any refund with respect to a  Gross-Up Payment paid by the
Company, the Participant shall (subject to the Company’s complying with the
requirements of Section 5.2(f)) promptly pay to the Company the amount of such
refund (together with any interest paid or credited thereon after any taxes
applicable thereto).  If a determination is made that the Participant shall not
be entitled to any refund with respect to such claim and the Company does not
notify the Participant in writing of its intent to contest such denial prior to
the expiration of 30 calendar days after such determination, then the amount
paid to the Participant by the Company as provided in Section 5.2(f) shall not
be required to be repaid, and the amount of such payment shall be an offset to
the amount of Gross-Up Payment required to be paid pursuant to this Section 5.2.

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Section 6

Other Severance Benefits Under Other Programs or Under Law

6.1           Participants in the Plan who actually become entitled to benefits
under this Plan shall not be entitled to receive any other severance, or
termination payments under any general severance or separation pay program,
policy or practice of the Employer, or any notice payments (or notice in lieu of
severance) from the Employer.  In addition, the Participant’s benefits under the
Plan will be reduced by the amount of any severance or termination payments, or
pay in lieu of notice, (i) which are payable by the Company or the Employer to
the Participant on account of his or her employment, or termination of
employment, with the Company or the Employer, and (ii) which are required to be
paid by the Company or the Employer to the Participant under any Federal, State,
provincial, local or other law (including any payment pursuant to the Worker
Adjustment and Retraining Notification Act or any comparable State, local, or
provincial law).

6.2           Notwithstanding the foregoing, a Participant’s benefits under this
Plan shall not be reduced or otherwise affected or adjusted in any manner as a
result of awards to the Participant under the Company’s Incentive Equity Plan as
it may be amended in the future or under any successor plan.

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Section 7

Administration

7.1           Plan Interpretation and Benefit Determinations.  The Plan shall be
administered by the Plan Administrator.  The Plan Administrator shall have the
exclusive right, power, and authority, in its sole and absolute discretion, to
administer, apply and interpret the Plan and any other documents (including
without limitation, by supplying omissions from, correcting deficiencies in, or
resolving inconsistencies or ambiguities in, the language of the Plan) and to
decide all factual and legal matters arising in connection with the operation or
administration of the Plan.

Without limiting the generality of the foregoing paragraph, the Plan
Administrator shall have the discretionary authority and power to:

(a)           take all actions and resolve all questions (including factual
questions) with respect to the eligibility for, and the amount of, benefits
payable under the Plan to Employees or Participants or their beneficiaries;

(b)           formulate, interpret and apply rules, regulations and policies
necessary to administer the Plan;

(c)           decide questions, including legal or factual questions, relating
to the calculation and payment of benefits, and all other determinations made,
under the Plan;

(d)           resolve and/or clarify any factual or other ambiguities,
inconsistencies and omissions arising under the Plan;

(e)           process, and approve or deny, benefit claims and rule on any
benefit exclusions.

All decisions of the Plan Administrator as to the facts of any case, and the
application thereof to any case, as to the interpretation of any provision of
the Plan or its application to any case, and as to any other interpretative
matter or other determination or question under the Plan shall be final and
binding on all parties affected thereby, subject to the provisions of Sections
7.2 and 7.3.

7.2           Benefit Claims.  The Company will normally advise a Participant of
his right to benefits under the Plan at the time that a Termination of the
Participant’s employment takes place.  A Participant may also make a claim
concerning his or her right to receive a benefit under the Plan (a “Claim”) by
filing that Claim with the Company’s Director of Benefits at the following
address:

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Georgia Gulf Corporation

 

P.O. Box 105197

 

Atlanta, GA 30348

 

Attention: Director of Benefits

 

A Claim must be made by a Participant within 60 days following his Termination
Date.

7.3           Appealing Benefit Claims.  The Participant will be informed of the
decision of the Plan Administrator with respect to a Claim within 90 days after
it is filed.  Under special circumstances, the Plan Administrator may require an
additional period of not more than 90 days to review a Claim.  If this occurs,
the Participant will be notified in writing as to the length of the extension,
the reason for the extension, and any other information needed in order to
process the Claim.

A denial of a claim by the Plan Administrator, wholly or partially, shall be
written in a manner calculated to be understood by the claimant and shall
include:

(a)           the specific reason or reasons for the denial;

(b)           specific reference to pertinent 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 and an explanation of why such material or
information is necessary; and

(d)           an explanation of the claim review procedure.

A claimant whose Claim is denied (or his duly authorized representative) may,
within 60 days after receipt of denial of his Claim, request a review of such
denial by the Plan Administrator by filing with the Plan Administrator a written
request for review of his Claim.  If the claimant does not file a request for
review with the Plan Administrator within such 60-day period, the claimant shall
be deemed to have acquiesced in the original decision of the Plan Administrator
on his Claim.  If a written request for review is so filed within such 60-day
period, the Plan Administrator shall conduct a full and fair review of such
Claim.  During such full review, the claimant shall be given the opportunity to
review documents that are pertinent to his Claim and to submit issues and
comments in writing.  The Plan Administrator shall notify the claimant of its
decision on review within 60 days after receipt of a request for review;
provided, however, that if special circumstances require an extension of time
for processing the Claim, then the Plan Administrator shall provide written
notice of the extension to the Participant prior to the expiration 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 set forth
the special circumstances requiring an extension of time and the date by which
the Plan Administrator expects to reach a decision on review.  Notice of the
decision on review shall be in writing and will contain such information as is
required by applicable United States Department of Labor Regulations.  If the
decision on review is not furnished to the

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claimant within such 60-day period, the Claim shall be deemed to have been
denied on review.  The decision on review by the Plan Administrator shall be
final and binding on all parties and persons affected thereby.

7.4           Non-Binding Mediation.  In the event the Participant is not
satisfied with the decision on an appeal made pursuant to Section 7.3, and the
amount of the Claim equals or exceeds $5,000, notwithstanding anything in
Section 7.3 to the contrary, the Participant may request that the Claim be
resolved pursuant to non-binding mediation administered by the American
Arbitration Association under the Mediation Rules specified in its National
Rules for the Resolution of Employment Disputes.  All fees and expenses of the
mediator and all other expenses of the mediation procedures, except for
attorneys’ fees and witness expenses, shall be shared equally by the Participant
and the Company.  Each party shall bear its own witness expenses and attorneys’
fees.

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Section 8

Miscellaneous

8.1           Tax Withholding.  The Company shall have the authority to withhold
or to cause to be withheld applicable taxes from any payments made under or in
accordance with the Plan to the extent required by law.  In addition, the
Company and the Employer shall have the right to delay or permanently withhold
any benefit under this Plan to the extent that the payment of such benefit would
constitute a violation of Section 409A of the Code.

8.2           Unfunded Plan.  The Plan is unfunded.  Each Employer shall pay the
full cost of the benefits payable under the Plan to employees of such Employer
out of its general assets.

8.3           Not a Contract of Employment.  The Plan shall not be deemed to
constitute a contract of employment, or to impose on the Company or any Employer
any obligation to retain any Participant as an employee, to continue any
Participant’s current employment status or to change any employment policies of
the Company or the Employer; nor shall any provision hereof restrict the right
of the Company or the Employer to discharge any of its employees or restrict the
right of any such employee to terminate his employment with the Company or the
Employer.

8.4           Choice of Law.  The Plan shall be construed and governed under the
laws of the State of Georgia, except to the extent Federal law is applicable.

8.5           Effect of Invalidity of Provision.  If any provision of the Plan
is held invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision hereof, and such provision shall, to the extent
possible, be modified in such manner as to be valid and enforceable but so as to
most nearly retain the intent of the Company.  If such modification is not
possible, the Plan shall be construed and enforced as if such provision had not
been included in the Plan.

8.6           Effect of Individual Agreements.  The Plan does not affect the
severance provisions of any written individual employment contracts or
individual separation agreements governing the terms of a Participant’s
separation from employment with the Company, provided, however, if such an
agreement provides for payments in respect of Base Salary, bonuses, vacation pay
and benefits, no such payments shall be made under this Plan.

8.7           Records.  The records of the Company with respect to years of
service, employment history, Base Salary, absences, and all other relevant
matters shall be conclusive for all purposes of this Plan.

8.8           Successors and Binding Effect.

(a)           The Company shall require any successor, (including without
limitation any persons acquiring directly or indirectly all or substantially all
of the

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business and/or assets of the Company whether by purchase, merger,
consolidation, reorganization or otherwise, and such successor shall thereafter
be deemed the Company for the purposes of the Plan), to assume and agree to
perform the obligations under the Plan in the same manner and to the same extent
the Company would be required to perform if no such succession had taken place. 
The Plan shall be binding upon and inure to the benefit of the Company and any
successor to the Company, but shall not otherwise be assignable, transferable or
delegable by the Company.

(b)           The rights under the Plan shall inure to the benefit of and be
enforceable by each Participant’s personal or legal representatives, executors,
administrators, successors, heirs, distributees and/or legatees.

(c)           The rights under the Plan are personal in nature and neither the
Company nor any Participant shall, without the consent of the other, assign,
transfer or delegate the Plan or any rights or obligations hereunder except as
expressly provided in this Section 8.8.  Without limiting the generality of the
foregoing, a Participant’s right to receive payments hereunder shall not be
assignable, transferable or delegable, whether by pledge, creation of a security
interest or otherwise, other than by a transfer by his or her will or by the
laws of descent and distribution and, in the event of any attempted assignment
or transfer contrary to this Section, the Company shall have no liability to pay
any amount so attempted to be assigned, transferred or delegated.

(d)           The obligation of the Company to make payments and/or provide
benefits hereunder shall represent an unsecured obligation of the Company.

(e)           The Company recognizes that each Participant will have no adequate
remedy at law for breach by the Company of any of the agreements contained
herein and, in the event of any such breach, the Company hereby agrees and
consents that each Participant shall be entitled to a decree of specific
performance, mandamus or other appropriate remedy to enforce performance of
obligations of the Company under the Plan.

8.9           Payments to Certain Participants.  In making any distribution to
or for the benefit of any incompetent Participant, or any other Participant who,
in the opinion of the Plan Administrator, is incapable of properly using,
expending, investing, or otherwise disposing of such distribution, the Plan
Administrator, in its sole and complete discretion may, but need not, make such
distribution to a court appointed guardian or committee of any incompetent
Participant, or to any adult with whom such person temporarily or permanently
resides; and any such guardian, committee, or other person shall have full
authority and discretion to expend such distribution for the use and benefit of
such person; and the receipt of such guardian or committee, or other person
shall be a complete discharge to the Plan Administrator and this Plan, without
any responsibility on the part of the Plan Administrator to see to the
application of amounts so distributed.

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8.10         Correction of Participants’ Benefits.  If an error or omission is
discovered in the amount distributed to a Participant, the Plan Administrator
will make such equitable adjustments in the records of the Plan as may be
necessary or appropriate to correct such error or omission as of the Plan Year
in which such error or omission is discovered; provided, however, that if the
error is discovered within the last 60 days of a Plan Year, then the corrective
action may be completed in the following Plan Year.

8.11         Liability Limited.  To the extent permitted by applicable law,
neither the Board, nor any member thereof, nor the Employer shall be liable for
any acts of omission or commission in administering the Plan, except for his or
its own individual, willful misconduct.  The Employer, Plan Administrator and
each member of the Board shall be entitled to rely conclusively on all
valuations, certificates, opinions and reports which shall be furnished by an
accountant, insurance company, counsel or other expert who shall be employed or
engaged by the Board or the Employer.

8.12         Legal References.  Any reference in this Plan to a provision of law
which is, subsequent to the effective date of this Plan, revised, modified,
finalized or redesignated, shall automatically be deemed a reference to such
revised, modified, finalized or redesignated provision of law.

8.13         Electronic Means of Communication.  Whenever, under this Plan, a
Participant is required or permitted to provide a notice, request a
distribution, or otherwise communicate with the Employer, the Plan
Administrator, or a delegate of either of them, to the extent permitted by
applicable law, the notice, distribution request or other communication may be
transmitted by means of telephonic or other electronic communication, if the
administrative procedures under the Plan provide for such means of
communication.

8.14         Gender and Number.  As used herein, the masculine pronoun shall
include the feminine, and the singular shall include the plural, unless a
contrary meaning is clearly intended.

8.15         Captions.  The captions in the Plan are for convenience of
reference only and do not define, limit or describe the scope or intent of the
Plan or any part hereof and shall not be considered in any construction hereof.

8.16         Section 409A.  To the extent applicable, this Plan is intended to
comply with the provisions of Section 409A of the Code.  This Plan shall be
administered in a manner consistent with this intent and any provision that
would cause this Plan to fail to satisfy Section 409A of the Code shall have no
force and effect until amended to comply with Section 409A of the Code (which
amendment may be retroactive to the extent permitted by Section 409A of the Code
and may be made by the Company without the consent of Participants). 
Notwithstanding anything to the contrary in this Plan, if any portion of the
amounts payable under Section 4 constitute a “deferral of compensation,” that
portion of the amounts payable under Section 4 will be paid on the latest of (i)
the date specified in this Plan, (ii) the date of the Participant’s “separation
from service,” or (iii) if the Participant is a “specified employee,” 6 months
and 1 day after the

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Participant’s separation from service (the “Payment Period”).  “Deferral of
compensation,” “separation from service” and “specified employee” have the
meanings ascribed to such phrases in Section 409A of the Code.

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Section 9

Amendment or Termination of the Plan

The Plan may be amended or terminated, in whole or in part, at any time, with or
without prior notice, by action of the Board.  Notwithstanding the foregoing,
any amendment to the Plan, in whole or in part (including an amendment to
terminate the Plan), that is adverse to the interests of any Participant (except
for an amendment adopted to comply with applicable law, including Section 409A
of the Code) will not be effective until the date which is one year following
the date of such amendment, and any such amendment which is adopted within six
months prior to a Change of Control will be void upon such Change of Control.

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