Ex. 10.1 - JCB Employee Agmt. 1-20-06


    SECOND
      AMENDMENT TO

    SECOND
      AMENDED AND RESTATED

    EMPLOYMENT
      AGREEMENT

    


    This
      Second Amendment to Second Amended and Restated Employment Agreement (“Second
      Amendment”) is entered into by and between ICO, Inc. (the “Company”) and Jon C.
      Biro (“Employee”), to be effective January 20, 2006 (the “Effective
      Date”).

     

    WHEREAS,
      Employee and the Company entered into an Employment Agreement (the “Agreement”),
      being effective as of January 28, 2004, which Agreement was amended by the
      First
      Amendment to Second Amended and Restated Employment Agreement (the “First
      Amendment”), being effective February 11, 2005; and

    


    WHEREAS,
      the parties desire to further amend the Agreement, as set forth
      herein.

    


    NOW,
      THEREFORE, for and in consideration of the mutual promises, covenants, and
      obligations contained herein, the Company and Employee agree as
      follows:

     

    
      	1.  	
              Pursuant
                to Section 1.1(a) of the Agreement, the parties hereby agree to extend
                the
                Agreement for an additional two-year Extension
                Period.

            


    

    


    
      	2.  	
              It
                is the parties’ agreement that Employee’s Annual Incentive Bonus (as
                defined in Section 2.2 of the Agreement) for the Company’s fiscal year
                2006 (commencing October 1, 2006) shall be calculated pursuant to
                Exhibit
                A
                hereto, with the following clarification: For the purpose of the
                fiscal
                year 2006 incentive calculation, “Corporate
                Expenses,”
                as defined on page 2 of Exhibit A, shall also be adjusted (the
                “Adjustment”) to exclude unbudgeted business unit related expenses that
                are paid and included in corporate expenses for the Company’s fiscal year
                2006. The Adjustment shall be reviewed and approved by the Company’s Chief
                Executive Officer. 

            


    

    


    
      	3.  	
              Effective
                November 1, 2005, Employee’s Base Salary (as defined in Section 2.1 of the
                Agreement) is increased to Two Hundred and Thirty-Five Thousand Dollars
                ($235,000) per annum.

            


    

    


    IN
      WITNESS WHEREOF,
      the
      Company and Employee have duly executed this Agreement in multiple originals
      to
      be effective on the Effective Date. 

                            

    
      
        	
                ICO,
                  Inc.

              	 	Employee
	
                 

                 
                  /s/ A. John Knapp,
                  Jr.                      
                  

              	 	 

                 
                  /s/ Jon C. Biro     
                                         
                  

              
	
                 
                  A. John Knapp, Jr.

              	 	
                Jon
                  C. Biro

              
	 President & Chief Executive
                Officer	 	
                Chief
                  Financial Officer

              
	 	 	 
	 Date:
                January 20, 2005	 	 Date:
                January 20, 2005


      



     


    
      
        
           

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    Exhibit
      A

    


    
      	
              FY
                2006 Incentive Plan Matrix- CFO

            
	 
	 	 	
              Pay-out
                as a percentage of Base Salary *

            
	
              Measurement

            	
              Weighting

            	
              0%

            	
              24%

            	
              48%

            
	
              Corporate
                Expenses (1)

            	
              33%

            	
               

            	
              
              

            	
               

               

            
	
              ICO,
                Inc. consolidated ROE

            	
              33%

            	
               

               

            	
               

            	
               

            
	
              Subjective/Qualitative
                Factors

            	
              33%

            	
               

               

            	
               

            	
               

            


    

    



    
      
        
           

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    Exhibit
      A (continued)

    


    


    ICO,
      Inc.

    FY
      2006 Incentive Plan Matrix - CFO

    Explanation
      of Measurement Definitions and additional Explanatory
      Notes

    


    


    Measurement
      definitions

    


    * “Corporate
      Expenses”:
      Defined as Corporate general and administrative expenses, excluding stock option
      expenses and excluding Sarbanes-Oxley 404 implementation expenses. These targets
      assume the SEC and/or PCAOB will provide relief to small companies (including
      ICO) to reduce the burden of SOX 404. If this relief is not granted then the
      targets shall be adjusted to factor in SOX 404 expenses for FY 2006 (i.e.
      exclude such expenses from Corporate expenses for the purpose of the incentive
      calculation expenses for unbudgeted third-party-404 related audit and other
      fees
      necessary to comply).

    


    * “ROE”:
      Net
      income from continuing operations, minus preferred dividends (whether paid
      or
      accrued towards Convertible Preferred Stock liquidation preference), divided
      by
      Stockholders' equity, less the liquidation preference of Convertible Preferred
      Stock. For purposes of this calculation, Stockholders' equity and liquidation
      preference balances shall be averaged using the previous four (4) quarter-end
      balances, plus the prior year-end balance (e.g. for FY 2006 bonus calculation
      the FY 2005 previous year end-balance plus the four quarter-end balances of
      fiscal year 2006).

    


    Computational
      Note

    For
      each
      measurement the bonus amount payable is calculated as the result achieved for
      each measurement (i.e. the 0%, 24% or 48% pay-out) times the weighting and
      multiplied by the CFO’s Base Salary. Results for each measurement falling
      between the targeted amounts adjust the pay-out targets by interpolating the
      percentage of: (i) the resulted achieved minus the lower threshold divided
      by,
      (ii) the difference between the higher and lower target, times (iii) the higher
      pay-out target percentage.

    


    Additional
      Explanatory Notes

    * Subject
      to Compensation Committee approval of all terms of grant, and subject to options
      being available under an existing ICO, Inc. employee stock option plan, for
      bonus amounts achieved in any measurement category based on exceeding any
      applicable 24% target, at the Committee’s discretion the Committee may, if
      requested by the CFO, award stock options in place of a portion of incentive
      cash compensation, priced, with such options vesting immediately and using
      the
      Company’s option pricing model in accordance with SFAS 123R.

    


    
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