ex4_11.htm


    
      

    


    
      Exhibit
4.11



    


    


    


    


    


    


    


    


    


    


    


    


    


    


    TETRA
TECHNOLOGIES, INC.

    


    2007
LONG TERM INCENTIVE COMPENSATION PLAN

    


    


     

     

     

     

     

     

     

     

     

     

    
 

    
      
         


      

      
         


        
          

        

      

      
         


      

    


    


    TETRA
TECHNOLOGIES, INC.

    


    2007
LONG TERM INCENTIVE COMPENSATION PLAN

    


    Table
of Contents

    
    

    
      
        
          	
                  ARTICLE
      I    INTRODUCTION

                	
                  1

                
	
                  1.1

                	
                   Purpose

                	
                  1

                
	
                  1.2

                	
                   Definitions

                	
                  1

                
	
                  1.3

                	
                   Shares
      Subject to the Plan

                	
                  5

                
	
                  1.4

                	
                   Administration
      of the Plan

                	
                  6

                
	
                  1.5

                	
                   Granting
      of Awards to Participants

                	
                  7

                
	
                  1.6

                	
                   Leave
      of Absence

                	
                  7

                
	
                  1.7

                	
                   Term of
      Plan

                	
                  7

                
	
                  1.8

                	
                   Amendment
      and Discontinuance of the Plan

                	
                  7

                
	 
    	 
    	 
    
	
                  ARTICLE
      II    NONQUALIFIED
      OPTIONS

                	
                  7

                
	
                  2.1

                	
                   Eligibility

                	
                  7

                
	
                  2.2

                	
                   Exercise
      Price

                	
                  8

                
	
                  2.3

                	
                   Terms
      and Conditions of Nonqualified Options

                	
                  8

                
	
                  2.4

                	
                   Option
      Repricing

                	
                  9

                
	
                  2.5

                	
                   Vesting

                	
                  9

                
	 
    	 
    	 
    
	
                  ARTICLE
      III    INCENTIVE
      OPTIONS

                	
                  9

                
	
                  3.1

                	
                   Eligibility

                	
                  9

                
	
                  3.2

                	
                   Exercise
      Price

                	
                  9

                
	
                  3.3

                	
                   Dollar
      Limitation

                	
                  10

                
	
                  3.4

                	
                   10%
      Stockholder

                	
                  10

                
	
                  3.5

                	
                   Incentive
      Options Not Transferable

                	
                  10

                
	
                  3.6

                	
                   Compliance
      with Code Section 422

                	
                  10

                
	
                  3.7

                	
                   Limitations
      on Exercise

                	
                  10

                
	 
    	 
    	 
    
	
                  ARTICLE
      IV    BONUS
      STOCK

                	
                  10

                
	 
    	 
    	 
    
	
                  ARTICLE
      V    STOCK
      APPRECIATION RIGHTS

                	
                  10

                
	
                  5.1

                	
                   Eligibility

                	
                  10

                
	
                  5.2

                	
                   Repricing

                	
                  11

                
	 
    	 
    	 
    
	
                  ARTICLE
      VI    RESTRICTED
      STOCK

                	
                  11

                
	
                  6.1

                	
                   Eligibility

                	
                  11

                
	
                  6.2

                	
                   Restrictions,
      Restricted Period and Vesting

                	
                  11

                
	
                  6.3

                	
                   Forfeiture
      of Restricted Stock

                	
                  12

                
	
                  6.4

                	
                   Delivery
      of Shares of Common Stock

                	
                  12

                
	 
    	 
    	 
    
	
                  ARTICLE
      VII    PERFORMANCE
      AWARDS

                	
                  12

                
	
                  7.1

                	
                   Performance
      Awards

                	
                  12

                
	
                  7.2

                	
                   Performance
      Goals

                	
                  12

                


        


        
          
             


          

          
            i  

            
              

            

          

          
             


          

        


        
          	
                  ARTICLE
      VIII    CERTAIN
      PROVISIONS APPLICABLE TO ALL AWARDS

                	
                  14

                
	
                  8.1

                	
                   General

                	
                  14

                
	
                  8.2

                	
                   Stand-Alone,
      Additional and Substitute Awards

                	
                  15

                
	
                  8.3

                	
                   Term of
      Awards

                	
                  15

                
	
                  8.4

                	
                   Form
      and Timing of Payment Under Awards; Deferrals

                	
                  16

                
	
                  8.5

                	
                   Vested
      and Unvested Awards

                	
                  16

                
	
                  8.6

                	
                   Exemptions
      from Section 16(b) Liability

                	
                  17

                
	
                  8.7

                	
                   Transferability

                	
                  17

                
	
                  8.8

                	
                   Rights
      as a Stockholder

                	
                  17

                
	
                  8.9

                	
                   Listing
      and Registration of Shares of Common Stock

                	
                  18

                
	
                  8.10

                	
                   Termination
      of Employment, Death, Disability and Retirement

                	
                  18

                
	
                  8.11

                	
                   Change
      in Control

                	
                  19

                
	 
    	 
    	 
    
	
                  ARTICLE
      IX    WITHHOLDING
      FOR TAXES

                	
                  20

                
	 
    	 
    	 
    
	
                  ARTICLE
      X    MISCELLANEOUS

                	
                  20

                
	
                  10.1

                	
                   No
      Rights to Awards or Uniformity Among Awards

                	
                  20

                
	
                  10.2

                	
                   Conflicts
      with Plan

                	
                  20

                
	
                  10.3

                	
                   No
      Right to Employment

                	
                  21

                
	
                  10.4

                	
                   Governing
      Law

                	
                  21

                
	
                  10.5

                	
                   Gender,
      Tense and Headings

                	
                  21

                
	
                  10.6

                	
                   Severability

                	
                  21

                
	
                  10.7

                	
                   Stockholder
      Agreements

                	
                  21

                
	
                  10.8

                	
                   Funding

                	
                  21

                
	
                  10.9

                	
                   No
      Guarantee of Tax Consequences

                	
                  21

                


        

      

    

     


    
      
         


      

      
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    TETRA
TECHNOLOGIES, INC.

    2007
LONG TERM INCENTIVE COMPENSATION PLAN

    


    ARTICLE
I

    INTRODUCTION

    


    1.1           Purpose. This TETRA
Technologies, Inc. 2007 Long Term Incentive Compensation Plan (the Plan) amends and
restates the TETRA Technologies, Inc. Amended and Restated 2007 Equity Incentive
Compensation Plan (the First Restated Plan)
and is intended to promote the interests of TETRA Technologies, Inc., a Delaware
corporation, (the Company) and its
stockholders by encouraging Employees, Consultants and Non-Employee Directors of
the Company or its Affiliates (as defined below) to acquire or increase their
equity interests in the Company, thereby giving them an added incentive to work
toward the continued growth and success of the Company, and to encourage them to
remain with and devote their best efforts to the business of the Company thereby
advancing the interests of the Company and its stockholders. The Board of
Directors of the Company (the Board) also
contemplates that through the Plan, the Company and its Affiliates will be
better able to compete for the services of the individuals needed for the
continued growth and success of the Company. The Plan provides for payment of
various forms of incentive compensation and accordingly is not intended to be a
plan that is subject to the Employee Retirement Income Security Act of 1974, as
amended, and shall be administered accordingly.

    


    1.2           Definitions. As used in the
Plan, the following terms shall have the meanings set forth below:

    


    Affiliate means (i)
any entity in which the Company, directly or indirectly, owns 10% or more of the
combined voting power, as determined by the Committee, (ii) any “parent
corporation” of the Company (as defined in Section 424(e) of the Code), (iii)
any “subsidiary corporation” of any such parent corporation (as defined in
Section 424(f) of the Code) of the Company and (iv) any trades or businesses,
whether or not incorporated which are members of a controlled group or are under
common control (as defined in Sections 414(b) or (c) of the Code) with the
Company; provided, that, for the purpose of issuing Options or Stock
Appreciation Rights, “Affiliate” means any corporation or other entity in a
chain of corporations and/or other entities in which the Company has a
“controlling interest” within the meaning of Treas. Reg. § 1.414(c)-2(b)(2)(i),
but using the threshold of 50% ownership wherever 80% appears.

    


    Awards means,
collectively, Options, Bonus Stock, Stock Appreciation Rights, Restricted Stock
or Performance Awards.

    


    Board means the board
of directors described in Section 1.1 of the Plan.

    


    Bonus Stock means
Common Stock described in Article IV of the Plan.

    


    Change in Control
shall be deemed to have occurred upon any of the following events:

    


    (i) any “person” (as defined in Section 3(a)(9)
of the Exchange Act, and as modified in Section 13(d) and 14(d) of the Exchange
Act) other than (A) the Company or any of its subsidiaries, (B) any employee
benefit plan of the Company or any of its subsidiaries, (C) or any Affiliate,
(D) a company owned, directly or indirectly, by stockholders of the Company in
substantially the same proportions as their ownership of the Company, or (E) an
underwriter temporarily holding securities pursuant to an offering of such
securities (a Person), becomes the
“beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or
indirectly, 

     

    
      
        
        

      

      
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    of securities of
the Company representing more than 50% of the shares of voting stock of the
Company then outstanding;

    


    (ii) the consummation of any merger,
organization, business combination or consolidation of the Company or one of its
subsidiaries with or into any other company, other than a merger,
reorganization, business combination or consolidation which would result in the
holders of the voting securities of the Company outstanding immediately prior
thereto holding securities which represent immediately after such merger,
reorganization, business combination or consolidation more than 50% of the
combined voting power of the voting securities of the Company or the surviving
company or the parent of such surviving company;

    


    (iii) the consummation of a sale or disposition
by the Company of all or substantially all of the Company’s assets, other than a
sale or disposition if the holders of the voting securities of the Company
outstanding immediately prior thereto hold securities immediately thereafter
which represent more than 50% of the combined voting power of the voting
securities of the acquiror, or parent of the acquiror, of such
assets;

    


    (iv) the stockholders of the Company approve a
plan of complete liquidation or dissolution of the Company; or

    


    (v) individuals who, as of the Effective Date,
constitute the Board (the Incumbent Board)
cease for any reason to constitute at least a majority of the Board; provided,
however, that any individual becoming a director subsequent to the Effective
Date whose election by the Board, was approved by a vote of at least a majority
of the directors then comprising the Incumbent Board shall be considered as
though such individual were a member of the Incumbent Board, but excluding, for
this purpose, any such individual whose initial assumption of office occurs as a
result of an election contest with respect to the election or removal of
directors or other solicitation of proxies or consents by or on behalf of a
person other than the Board.

    


    Notwithstanding the foregoing, however, in any
circumstance or transaction in which compensation resulting from or in respect
of an Award would be subject to the income tax under Section 409A of the Code if
the foregoing definition of “Change in Control” were to apply, but would not be
so subject if the term “Change in Control” were defined herein to mean a “change
in control event” within the meaning of Treas. Reg. § 1.409A-3(i)(5), then
“Change in Control” shall mean a “change in control event” within the meaning of
Treas. Reg. § 1.409A-3(i)(5), but only to the extent necessary to prevent
such compensation from becoming subject to the income tax under Section 409A of
the Code.

    


    Code means the
Internal Revenue Code of 1986, as amended from time to time, and the rules and
regulations thereunder.

    


    Committee means the
Management and Compensation Committee of the Board which shall consist of not
less than two members of the Board, each of whom shall qualify as a
“non-employee director” (as that term is defined in Rule 16b-3 of the General
Rules and Regulations under the Exchange Act) appointed by and serving at the
pleasure of the Board to administer the Plan or, if none, the Board; provided
however, that with respect to any Award granted to a Covered Employee which is
intended to be “performance-based compensation” as described in Section
162(m)(4)(C) of the Code, the Committee shall consist solely of two or more
“outside directors” as described in Section 162(m)(4)(C)(i) of the
Code.

     

    
      
        
        

      

      
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       Common
Stock means the common stock, $0.01 par value per share of the
Company.

    


    Company means the
corporation described in Section 1.1 of the Plan or any successor thereto which
assumes and continues the Plan.

    


    Consultant means any
individual, other than a Director or an Employee, who renders consulting or
advisory services to the Company or an Affiliate, provided such services are not
in connection with the offer or sale of securities in a capital raising
transaction.

    


    Covered Employee
means any of the Chief Executive Officer of the Company and the three highest
paid officers of the Company other than the Chief Executive Officer or the Chief
Financial Officer as described in Section 162(m)(3) of the Code or any
individual Consultant, Director or other Employee, or class of Consultants,
Directors or Employees, who the Committee specifies in an Award shall be treated
as a Covered Employee.

    


    Disability means an
inability to perform the Participant’s material services for the Company for a
period of 90 consecutive days or a total of 180 days, during any 365-day period,
in either case as a result of incapacity due to mental or physical illness,
which is determined to be total and permanent. A determination of Disability
shall be made by a physician satisfactory to both the Participant (or his
guardian) and the Company, provided that if the Participant (or his guardian)
and the Company do not agree on a physician, the Participant and the Company
shall each select a physician and these two together shall select a third
physician, whose determination as to Disability shall be final, binding and
conclusive with respect to all parties. Notwithstanding the above, eligibility
for disability benefits under any policy for long-term disability benefits
provided to the Participant by the Company shall conclusively establish the
Participant’s disability.

    


    Effective Date means
May 4, 2007, the date on which the TETRA Technologies, Inc. 2007 Equity
Incentive Compensation Plan (the Original Plan) was
initially approved by stockholders of the Company. The provisions of the Prior
Plan, as amended from time to time including, without limitation, the First
Restated Plan and, if approved, the Plan, shall be applicable to all Awards
granted on or after the Effective Date. This Plan shall be effective the date
that it is approved by the stockholders of the Company.

    


    Employee means any
employee of the Company or an Affiliate.

    


    Employment means any
period in which a Participant is an Employee of the Company or an
Affiliate.

    


    Exchange Act means
the Securities Exchange Act of 1934, as amended.

    


    Fair Market Value or FMV Per
Share means, as of any given date, the closing price per share on the
principal exchange or over-the-counter market on which such shares are trading,
if any, or as reported on any composite index which includes such principal
exchange, or if no trade of the Common Stock shall have been reported for such
date, the closing price quoted on such exchange or market for the immediately
preceding date on which such shares were traded. The term “closing price” on any
given day shall mean (i) if the shares of Common Stock are listed or admitted
for trading on a national securities exchange, the last reported sales price on
such day, or (ii) if the shares of Common Stock are not listed or admitted for
trading on a national securities exchange, the last transaction price on such
day of the shares of Common Stock on the Nasdaq Market, Inc. (“NASDAQ”). If
shares of the Common Stock are not listed or admitted to trading on any
exchange, over-the-counter market or any similar organization on any given day,
the FMV Per Share shall 

     

    
      
        
        

      

      
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    be determined by
the Committee in good faith using any fair and reasonable means selected in its
discretion.

    


    Incentive Option
means any option that satisfies the requirements of Code Section 422 and is
granted pursuant to Article III of the Plan.

    


    Incumbent Board means
the Board described in paragraph (v) of the definition of Change in Control
under Section 1.2 of the Plan.

    


    Non-Employee Director
means a person who is a member of the Board but who is neither an Employee nor a
Consultant of the Company or any Affiliate.

    


    Nonqualified Option
means an option not intended to satisfy the requirements of Code Section 422 and
which is granted pursuant to Article II of the Plan.

    


    Option means an
option to acquire Common Stock granted pursuant to the provisions of the Plan,
and refers to either an Incentive Stock Option or a Nonqualified Stock Option,
or both, as applicable.

    


    Option Expiration
Date means the date determined by the Committee which shall not be more
than ten years after the date of grant of an Option.

    


    Optionee means a
Participant who has received or will receive an Option.

    


    Original Plan has the
meaning set forth in the definition of Effective Date under Section 1.2 of
the Plan.

    


    Participant means any
Non-Employee Director, Employee or Consultant granted an Award under the
Plan.

    


    Performance Award
means an Award granted pursuant to Article VII of the Plan which, if earned,
will afford the Participant the right to receive shares of Common Stock, cash or
any combination thereof as determined by the Committee.

    


    Plan means the plan
described in Section 1.1 of the Plan and set forth in this document, as amended
from time to time.

    


    Restricted Period
means the period established by the Committee with respect to an Award during
which the Award either remains subject to forfeiture or is not exercisable by
the Participant.

    


    Restricted Stock
means one or more shares of Common Stock prior to the lapse of restrictions
thereon, granted under Article VI of the Plan.

    


    Retirement means
termination of Employment of an Employee or termination of service of a
Non-Employee Director or Consultant, in each case under circumstances as shall
constitute retirement as determined by the Committee.

    


    Securities Act means
the Securities Act of 1933, as amended.

    


    Spread means the
amount determined pursuant to Section 5.1(a) of the Plan.

    


    Stock Appreciation
Right means an Award granted pursuant to Article V of the
Plan.

     

    
      
        
        

      

      
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    1.3           Shares Subject to the Plan.
Subject to adjustment as provided in this Plan, the maximum number of shares of
Common Stock that may be covered by Awards granted under the Plan shall be
5,590,000 shares, and of that number the maximum aggregate number of shares of
Common Stock that may be issued under the Plan through Options is 5,590,000
shares, all or any portion of which may be Incentive Options. Solely for the
purposes of implementing the limitation of the immediately preceding sentence,
an Award of an Option or a Stock Appreciation Right in respect of one share of
Common Stock shall be deemed to be an Award of one share of Common Stock on the
date of grant. An Award of a share of Bonus Stock or Restricted Stock shall be
deemed to be an Award of 1.15 shares of Common Stock for every one share granted
on the date of grant. With respect to any Performance Award to be settled in
shares of Common Stock, the value of the maximum benefit that may be paid under
the Performance Award shall be divided by the FMV Per Share of Common Stock as
of the date of grant of the Performance Award and each share resulting from such
computation shall be deemed to be an Award of 1.15 shares of Common Stock for
purposes of implementing the limitation on shares set forth in the first
sentence of this Section 1.3. If the number of shares of Common Stock issued in
settlement of the Performance Award exceeds the number determined to be issued
on the date of grant in accordance with the preceding sentence, each such
additional share of Common Stock issued shall be deemed to be an Award of 1.15
shares of Common Stock for the purposes of implementing the limitation on shares
set forth in the first sentence of this Section 1.3. In addition, during any
calendar year, the maximum number of shares of Common Stock underlying Awards
(other than Performance Awards) granted to any one Participant in such calendar
year shall not exceed 400,000 shares. The maximum amount of compensation
(whether denominated or payable in shares of Common Stock, cash, other Awards or
other property) that any one Participant may receive in any calendar year in
respect of Performance Awards may not exceed, in the aggregate,
$2,000,000.

    


    Notwithstanding the above, in the event that at
any time after the Effective Date the outstanding shares of Common Stock are
changed into or exchanged for a different number or kind of shares or other
securities of the Company by reason of a merger, consolidation,
recapitalization, reclassification, stock split, stock dividend, combination of
shares or the like, the aggregate number and class of securities available under
the Plan shall, subject to any required action by the stockholders of the
Company, automatically be proportionately adjusted, with no action required on
the part of the Committee or otherwise. Upon the occurrence of any of the events
described in the immediately preceding sentence, in order to ensure that after
such event the shares of Common Stock subject to the Plan and each Participant’s
proportionate interest shall be maintained substantially as before the
occurrence of such event, (i) the number of shares of Common Stock with respect
to which Awards may be granted under the Plan, (ii) the maximum number of shares
of Common Stock that may be covered by Awards to any single individual during
any calendar year, (iii) the number of shares of Common Stock subject to
outstanding Awards, and (iv) the grant or exercise price with respect to an
Award shall, where applicable, automatically be proportionately adjusted. Such
adjustment in an outstanding Option shall be made (i) without change in the
total cost applicable to the Option or any unexercised portion of the Option
(except for any change in the aggregate price resulting from rounding-off of
share quantities or prices) and (ii) with any necessary corresponding adjustment
in exercise price per share; provided, however, that no such adjustment
authorized under this Section 1.3 shall occur to the extent that (i) such action
would cause (A) the application of Section 162(m) or 409A of the Code to the
Award or (B) create adverse tax consequences under Section 162(m) or 409A of the
Code should either or both of those Code sections apply to the Award or (ii)
materially reduce the benefit to the Participant without the consent of the
Participant.

    


    In the event the number of shares to be
delivered upon the exercise or payment of any Award granted under the Plan is
reduced for any reason other than the withholding of shares for payment of taxes
or exercise price, or in the event any Award (or portion thereof) granted under
the Plan can no longer under any circumstances be exercised or paid, the


     

    
      
        
        

      

      
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    number of shares no
longer subject to such Award shall thereupon be released from such Award and
shall thereafter be available for the grant of additional Awards under the Plan
in the same amount as such shares were counted against the limit set forth in
the first paragraph of this Section 1.3. If any Performance Award granted under
this Plan may only be settled in cash, such Award shall not be counted against
the maximum number of shares that may be covered by Awards granted under the
Plan as set forth in the first paragraph of this Section 1.3. Shares of
Common Stock that cease to be subject to an Award because of the exercise of the
Award, or the vesting of a Restricted Stock Award or similar Award, shall no
longer be subject to any further grant under the Plan. Notwithstanding anything
to the contrary, (i) shares of Common Stock that are tendered, whether by
physical delivery or by attestation, to the Company by a Participant or withheld
from any Award by the Company as full or partial payment of the exercise price
or purchase price of any Award shall not be added back to the maximum share
limitations described above or thereafter be made available under the Plan for
the grant of additional Awards; (ii) shares that are withheld from any Award by
the Company in payment of any applicable tax withholding obligation in
connection with the exercise, vesting or earning of any Award shall not be added
back to the maximum share limitations described above or thereafter made
available under the Plan for the grant of additional awards; and (iii) with
respect to Stock Appreciation Rights, when a Stock Appreciation Right is
exercised, the shares of Common Stock subject to such Stock Appreciation Right
shall be counted against the shares available for issuance under the Plan as one
share of Common Stock for every share subject thereto, regardless of the number
of shares of Common Stock used to settle the Stock Appreciation Right upon
exercise. Shares issued pursuant to the Plan (i) may be treasury shares,
authorized but unissued shares or, if applicable, shares acquired in the open
market and (ii) shall be fully paid and nonassessable. No fractional shares
shall be issued under the Plan; payment for any fractional shares shall be made
in cash.

    


    1.4           Administration of the Plan.
The Plan shall be administered by the Committee. Subject to the provisions of
the Plan, the Committee shall (i) select the Employees, Consultants and
Non-Employee Directors to whom Awards may be granted hereunder,
(ii) determine the type or types of Awards to be made, (iii) determine
the size or number of shares to be subject to an Award, (iv) determine the
terms and conditions of any Award, consistent with the terms of the Plan, which
terms may include the time or times when Awards may be exercised (which may be
based on performance criteria), any provision regarding the acceleration of
vesting or waiver of forfeiture restrictions, and any other condition or
limitation regarding an Award, based on such factors as the Committee, in its
sole discretion, will determine, (v) modify or amend each Award, including
the discretionary acceleration of vesting, the waiver of forfeiture
restrictions, and the authority to extend the post-termination exercisability
period of Awards under the conditions set forth in the Plan, provided that any
such extension may not exceed the expiration date set forth in the Award,
(vi) interpret the Plan and all Awards under the Plan, (vii) make, amend
and rescind such rules as it deems necessary for the proper administration of
the Plan, (viii) make all other determinations necessary or advisable for the
administration of the Plan and (ix) correct any defect or supply any omission or
reconcile any inconsistency in the Plan or in any Award under the Plan in the
manner and to the extent that the Committee deems desirable to effectuate the
Plan. Any action taken or determination made by the Committee pursuant to this
and the other paragraphs of the Plan shall be final, binding and conclusive on
all affected persons, including the Company; any Affiliate; any grantee, holder
or beneficiary of an Award; any stockholder and any Employee, Consultant or
Non-Employee Director. No member of the Board or of the Committee shall be
liable for any action or determination made in good faith with respect to the
Plan or any Award granted hereunder and the members of the Board and the
Committee shall be entitled to indemnification and reimbursement by the Company
and its Affiliates in respect of any claim, loss, damage or expense (including
legal fees) arising therefrom to the full extent permitted by law.

     

    
      
        
        

      

      
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    1.5           Granting of Awards to
Participants. The Committee shall have the authority to grant, prior to
the expiration date of the Plan, Awards to such Employees, Consultants and
Non-Employee Directors as may be selected by it subject to the terms and
conditions hereinafter set forth in the Plan. In selecting the persons to
receive Awards, including the type and size of the Award, the Committee may
consider the contribution the recipient has made and/or may make to the growth
of the Company or its Affiliates and any other factors that it may deem
relevant. No member of the Committee shall vote or act upon any matter relating
solely to himself. Grants of Awards to members of the Committee must be ratified
by the Board. In no event shall any Employee, Consultant or Non-Employee
Director, nor his or its legal representatives, heirs, legatees, distributees or
successors have any right to participate in the Plan except to such extent, if
any, as permitted under the Plan and as the Committee may
determine.

    


    1.6           Leave of Absence. If an
Employee is on military, sick leave or other bona fide leave of absence, such
person shall be considered an “Employee” for purposes of an outstanding Award
during the period of such leave provided it does not exceed 90 days (or such
longer period as may be determined by the Committee in its sole discretion), or,
if longer, so long as the person’s right to reemployment is guaranteed either by
statute or by contract. If the period of leave exceeds 90 days (or such longer
period as may be determined by the Committee in its sole discretion), the
employment relationship shall be deemed to have terminated on the 91st day
(or the first day immediately following any period of leave in excess of 90 days
as approved by the Committee) of such leave, unless the person’s right to
reemployment is guaranteed by statute or contract.

    


    1.7           Term of Plan. If not sooner
terminated under the provisions of Section 1.8, the Plan shall terminate upon,
and no further Awards shall be made, after February 27, 2017; provided, however,
that the termination of the Plan on such date will not affect the validity of
any Award outstanding on the date of termination, which shall continue to be
governed by the applicable terms and conditions of the Plan.

    


    1.8           Amendment and Discontinuance of the
Plan. The Board may amend, suspend or terminate the Plan at any time
without prior notice to or consent of any person; provided, however, subject to
Section 8.11, no amendment, suspension or termination of the Plan may without
the consent of the holder of an Award terminate such Award or adversely affect
such person’s rights with respect to such Award in any material respect; and
provided further, however, that no amendment of the Plan shall be effective
prior to its approval by the stockholders of the Company to the extent that (i)
it provides for accelerated vesting other than upon the death, Disability or
Retirement of a Participant or in connection with a Change of Control,
(ii) it would contravene the requirements of Section 2.4 or Section 5.2 of
the Plan or (iii) such approval is required by (A) applicable legal
requirements, (B) the requirements of any securities exchange on which the
Company’s stock may be listed or (C) the requirements of the Nasdaq Stock
Market, Inc. on which the Company’s stock may be listed. Notwithstanding the
foregoing, the Board may amend the Plan in such manner as it deems necessary in
order to permit Awards to meet the requirements of the Code or other applicable
laws, or to prevent adverse tax consequences to the Participants.

    


    ARTICLE
II

    NONQUALIFIED
OPTIONS

    


    2.1           Eligibility. The Committee may
grant Nonqualified Options to purchase the Common Stock to any Employee,
Consultant and Non-Employee Director according to the terms set forth below.
Each Nonqualified Option granted under the Plan shall be evidenced by a written
agreement between the Company and the individual to whom Nonqualified Options
were granted in such form as the Committee shall provide.

     

    
      
        
        

      

      
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    2.2           Exercise Price. The exercise
price to be paid for each share of Common Stock deliverable upon exercise of
each Nonqualified Option granted under this Article II shall not be less than
one hundred percent (100%) of the FMV Per Share as of the date of grant of such
Nonqualified Option. The exercise price for each Nonqualified Option granted
under Article II shall be subject to adjustment as provided in Section 2.3(d) of
the Plan.

    


    2.3           Terms and Conditions of Nonqualified
Options. Nonqualified Options shall be in such form as the Committee may
from time to time approve, shall be subject to the following terms and
conditions and may contain such additional terms and conditions, not
inconsistent with this Article II, as the Committee shall deem
desirable:

    


    (a)           Option Period and Conditions and
Limitations on Exercise. No Nonqualified Option shall be exercisable
later than the Option Expiration Date. To the extent not prohibited by other
provisions of the Plan, each Nonqualified Option shall be exercisable at such
time or times as the Committee in its discretion may determine at the time such
Nonqualified Option is granted.

    


    (b)           Manner of Exercise. In order
to exercise a Nonqualified Option, the person or persons entitled to exercise it
shall deliver to the Company payment in full for (i) the shares being purchased
and (ii) unless other arrangements have been made with the Committee, any
required withholding taxes. The payment of the exercise price for each
Nonqualified Option shall either be (i) in cash or by check payable and
acceptable to the Company, (ii) with the consent of the Committee, by tendering
to the Company shares of Common Stock owned by the person for more than six
months having an aggregate Fair Market Value as of the date of exercise that is
not greater than the full exercise price for the shares with respect to which
the Nonqualified Option is being exercised and by paying any remaining amount of
the exercise price as provided in (i) above, or (iii) with the consent of the
Committee and compliance with such instructions as the Committee may specify, by
delivering to the Company and to a broker a properly executed exercise notice
and irrevocable instructions to such broker to deliver to the Company cash or a
check payable and acceptable to the Company to pay the exercise price and any
applicable withholding taxes. Upon receipt of the cash or check from the broker,
the Company will deliver to the broker the shares for which the Nonqualified
Option is exercised. In the event that the person elects to make payment as
allowed under clause (ii) above, the Committee may, upon confirming that the
Optionee owns the number of additional shares being tendered, authorize the
issuance of a new certificate for the number of shares being acquired pursuant
to the exercise of the Nonqualified Option less the number of shares being
tendered upon the exercise and return to the person (or not require surrender
of) the certificate for the shares being tendered upon the exercise. The date of
sale of the shares by the broker pursuant to a cashless exercise under (iii)
above shall be the date of exercise of the Nonqualified Option. If the Committee
so requires, such person or persons shall also deliver a written representation
that all shares being purchased are being acquired for investment and not with a
view to, or for resale in connection with, any distribution of such
shares.

    


    (c)           Nonqualified Options not
Transferable. Except as provided below, no Nonqualified Option granted
hereunder shall be transferable other than by (i) will or by the laws of descent
and distribution or (ii) pursuant to a domestic relations order and, during the
lifetime of the Participant to whom any such Nonqualified Option is granted, it
shall be exercisable only by the Participant (or his guardian). Any attempt to
transfer, assign, pledge, hypothecate or otherwise dispose of, or to subject to
execution, attachment or similar process, any Nonqualified Option granted
hereunder, or any right thereunder, contrary to the provisions hereof, shall be
void and ineffective, shall give no right to the purported transferee, and
shall, at the sole discretion of the Committee, result in forfeiture of the
Nonqualified Option with respect to the shares involved in such attempt. With
respect to a specific Nonqualified Option, in accordance with rules and
procedures established by the Committee from time to time, the Participant (or
his guardian) may transfer, for estate planning purposes, all or part of such
Nonqualified Option to one or more 

     

    
      
        
        

      

      
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    immediate family
members or related family trusts or partnerships or similar entities as
determined by the Committee. Any Nonqualified Option that is transferred in
accordance with the provisions of this Section may only be exercised by the
person or persons who acquire a proprietary interest in the Nonqualified Options
pursuant to the transfer.

    


          (d)           Adjustment of Nonqualified
Options. In the event that at any time after the Effective Date the
outstanding shares of Common Stock are changed into or exchanged for a different
number or kind of shares or other securities of the Company by reason of merger,
consolidation, recapitalization, reclassification, stock split, stock dividend,
combination of shares or the like, proportionate adjustments shall be made as
provided in Section 1.3.

    


    (e)           Listing and Registration of
Shares. Each Nonqualified Option shall be subject to the requirement that
if at any time the Committee determines, in its discretion, that the listing,
registration, or qualification of the shares subject to such Nonqualified Option
under any securities exchange or under any state or federal law, or the consent
or approval of any governmental regulatory body, is necessary or desirable as a
condition of, or in connection with, the issue or purchase of shares thereunder,
such Nonqualified Option may not be exercised in whole or in part unless such
listing, registration, qualification, consent or approval shall have been
effected or obtained and the same shall have been free of any conditions not
acceptable to the Committee.

    


    2.4           Option Repricing. With
stockholder approval, the Committee may grant to holders of outstanding
Nonqualified Options, in exchange for the surrender and cancellation of such
Nonqualified Options, new Nonqualified Options having exercise prices lower (or
higher with any required consent) than the exercise price provided in the
Nonqualified Options so surrendered and cancelled and containing such other
terms and conditions as the Committee may deem appropriate. Except as
contemplated by Section 2.3(d), no Nonqualified Option may be amended to reduce
the exercise price of the shares subject to such Nonqualified Option without
prior stockholder approval.

    


    2.5           Vesting. See Section 8.10 of
the Plan for provisions on vesting in connection with termination of Employment
or service. Also, see Section 8.11 of the Plan relating to vesting in connection
with a Change in Control. Except as provided in Section 8.10(d) with
respect to death, Disability and Retirement and Section 8.11(a) with
respect to a Change in Control, no amendment of the Plan or any Award shall be
effective prior to approval by the stockholders of the Company to the extent
that the amendment provides for accelerated vesting.

    


    ARTICLE
III

    INCENTIVE
OPTIONS

    


    The terms specified in this Article III shall
be applicable to all Incentive Options. Except as modified by the provisions of
this Article III, all the provisions of Article II shall be applicable to
Incentive Options. Options which are specifically designated as Nonqualified
Options shall not
be subject to the terms of this Article III.

    


    3.1           Eligibility. Incentive Options
may only be granted to Employees of the Company or its parent or subsidiary as
defined in Sections 424(e) or (f) of the Code, as applicable, while each such
entity is a “corporation” described in Section 7701(a)(3) of the Code and Treas.
Reg. Section 1.421-1(i)(1).

    


    3.2           Exercise Price. Subject to
Section 3.4, the exercise price per share shall not be less than one hundred
percent (100%) of the FMV Per Share as of the option date of grant.

     

    
      
        
        

      

      
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    3.3           Dollar Limitation. The
aggregate Fair Market Value (determined as of the respective date or dates of
grant) of shares of Common Stock for which one or more options granted to any
Employee under the Plan (or any other option plan of the Company or any
Affiliate which is a parent or subsidiary as defined in Code Sections 424(e) or
(f), as applicable) may for the first time become exercisable as Incentive
Options during any one (1) calendar year shall not exceed the sum of One Hundred
Thousand Dollars ($100,000). To the extent the Employee holds two (2) or more
such options which become exercisable for the first time in the same calendar
year, the foregoing limitation on the exercisability of such options as
Incentive Options shall be applied on the basis of the order in which such
options are granted.

    


    3.4           10% Stockholder. If any
Employee to whom an Incentive Option is granted owns stock possessing more than
ten percent (10%) of the total combined voting power of all classes of stock of
the Company or any “parent corporation” of the Company (as defined in Section
424(e) of the Code) or any “subsidiary corporation” of the Company (as defined
in Section 424(f) of the Code), then the exercise price per share shall not be
less than one hundred ten percent (110%) of the FMV Per Share as of the date of
grant and the option term shall not exceed five (5) years measured from the date
of grant. For purposes of the immediately preceding sentence, the attribution
rules under Section 424(d) of the Code shall apply for purposes of determining
an Employee’s ownership.

    


    3.5           Incentive Options Not
Transferable. No Incentive Option granted hereunder (i) shall be
transferable other than by will or by the laws of descent and distribution and
(ii) except as permitted in regulations or other guidance issued under Section
422 of the Code, shall be exercisable during the Optionee’s lifetime by any
person other than the Optionee (or his guardian).

    


    3.6           Compliance With Code Section
422. All Options that are intended to be incentive stock options
described in Code Section 422 shall be designated as such in the Option grant
and in all respects shall be issued in compliance with Code Section
422.

    


    3.7           Limitations on Exercise.
Except as provided in Section 8.10(d), no Incentive Option shall be exercisable
after the earlier of (i) three (3) months after the Optionee ceases to be
an Employee for any reason other than death or Disability, or more than one (1)
year after the Optionee ceases to be an Employee due to death or Disability, and
(ii) the Option Expiration Date.

    


    ARTICLE
IV

    BONUS
STOCK

    


    The Committee may, from time to time and
subject to the provisions of the Plan, grant shares of Bonus Stock to Employees,
Consultants and Non-Employee Directors. Such grants of Bonus Stock shall be in
consideration of performance of services by the Participant without additional
consideration except as may be required by the Committee or pursuant to Article
IX. Bonus Stock shall be shares of Common Stock that are not subject to a
Restricted Period under Article VI.

    


    ARTICLE
V

    STOCK
APPRECIATION RIGHTS

    


    5.1           Eligibility. The Committee is
authorized to grant Stock Appreciation Rights to Employees, Consultants and
Non-Employee Directors on the following terms and conditions.

    


    (a)           Right to Payment. A Stock
Appreciation Right shall confer on the Participant to whom it is granted, upon
exercise thereof, a right to receive shares of Common Stock, the value of


     

    
      
        
        

      

      
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    which is equal to
the excess of (A) the FMV Per Share on the date of exercise over (B) the deemed
exercise price which shall be one hundred percent (100%) of the FMV Per Share as
of the date of grant (the Spread) with respect
to a specified number of shares of Common Stock. Notwithstanding the foregoing,
the Committee may provide, in its sole discretion, that the Spread covered by a
Stock Appreciation Right may not exceed a specified amount. The deemed exercise
price for each Stock Appreciation Right granted under Article V shall be subject
to adjustment as provided in Section 1.3 in the event that at any time after the
Effective Date the outstanding shares of Common Stock are changed into or
exchanged for a different number or kind of shares or other securities of the
Company by reason of a merger, consolidation, recapitalization,
reclassification, stock split, stock dividend, or a combination of shares or the
like.

    


    (b)           Terms. The Committee shall
determine at the date of grant the time or times at which and the circumstances
under which a Stock Appreciation Right may be exercised in whole or in part
(including based on achievement of performance goals and/or future service
requirements), the method of exercise, and any other terms and conditions of any
Stock Appreciation Right; provided, however, a Stock Appreciation Right shall
not be granted in tandem or in combination with any other Award if that would
(i) cause application of Section 409A of the Code to the Award or (ii) result in
adverse tax consequences under Section 409A of the Code should that code section
apply to the Award.

    


    5.2           Repricing. With stockholder
approval, the Committee may grant to holders of outstanding Stock Appreciation
Rights, in exchange for the surrender and cancellation of such Stock
Appreciation Rights, new Stock Appreciation Rights having deemed exercise prices
lower (or higher with any required consent) than the deemed exercise price
provided in the Stock Appreciation Rights so surrendered and cancelled and
containing such other terms and conditions as the Committee may deem
appropriate. Except as contemplated by Section 1.3, no Stock Appreciation Right
may be amended to reduce the deemed exercise price of the shares subject to such
Stock Appreciation Right without prior stockholder approval.

    


    ARTICLE
VI

    RESTRICTED
STOCK

    


    6.1           Eligibility. All Employees,
Consultants and Non-Employee Directors shall be eligible for grants of
Restricted Stock.

    


    6.2           Restrictions,
Restricted Period and Vesting.

    


    (a)           The
Restricted Stock shall be subject to such forfeiture restrictions (including,
without limitation, limitations that qualify as a “substantial risk of
forfeiture” within the meaning given to that term under Section 83 of the Code)
and restrictions on transfer by the Participant and repurchase by the Company as
the Committee, in its sole discretion, shall determine. Prior to the lapse of
such restrictions the Participant shall not be permitted to transfer such
shares. The Company shall have the right to repurchase or recover such shares
for the amount of any cash paid therefor if (i) the Participant shall terminate
Employment from or services to the Company prior to the lapse of such
restrictions or (ii) the Restricted Stock is forfeited by the Participant
pursuant to the terms of the Award.

    


    (b)           Vesting. See Section 8.10 of
the Plan for provisions on vesting in connection with termination of Employment
or service. Also, see Section 8.11 of the Plan relating to vesting in connection
with a Change in Control. Except as provided in Section 8.10(d) with
respect to death, Disability and Retirement and Section 8.11(a) with
respect to a Change in Control, no amendment of the Plan or any Award shall be
effective prior to approval by the stockholders of the Company to the extent
that the amendment provides for accelerated vesting.

     

    
      
        
        

      

      
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    (c)           Immediate Transfer Without Immediate
Delivery of Restricted Stock. Each certificate representing Restricted
Stock awarded under the Plan shall be registered in the name of the Participant
and, during the Restricted Period shall be left on deposit with the Company, or
in trust or escrow pursuant to an agreement satisfactory to the Committee, along
with a stock power endorsed in blank until such time as the restrictions on
transfer have lapsed. The grantee of Restricted Stock shall have all the rights
of a stockholder with respect to such shares including the right to vote and the
right to receive dividends or other distributions paid or made with respect to
such shares; provided, however, the Committee may in the Award restrict the
Participant’s right to dividends until the restrictions on the Restricted Stock
lapse. Any certificate or certificates representing shares of Restricted Stock
shall bear a legend similar to the following:

    


    The shares
represented by this certificate have been issued pursuant to the terms of the
TETRA Technologies, Inc. 2007 Long Term Incentive Compensation Plan (as amended
and restated) and may not be sold, pledged, transferred, assigned or otherwise
encumbered in any manner except as is set forth in the terms of the Award
dated             ,
20___.

    


    6.3           Forfeiture of Restricted
Stock. If, for any reason, the restrictions imposed by the Committee upon
Restricted Stock are not satisfied at the end of the Restricted Period, any
Restricted Stock remaining subject to such restrictions shall thereupon be
forfeited by the Participant and reacquired by the Company.

    


    6.4           Delivery of Shares of Common
Stock. Pursuant to Section 8.5 of the Plan and subject to withholding
requirements of Article IX of the Plan, at the expiration of the Restricted
Period, a stock certificate evidencing the Restricted Stock (to the nearest full
share) with respect to which the Restricted Period has expired shall be
delivered without charge to the Participant, or his personal representative,
free of all restrictions under the Plan.

    


    ARTICLE
VII

    PERFORMANCE
AWARDS

    


    7.1           Performance Awards. The
Committee may grant Performance Awards based on performance goals as set forth
in Section 7.2 measured over a performance period established pursuant to
Section 7.2(c) of the Plan. The Committee may use any such business
criteria and other measures of performance as set forth in Section 7.2 as
it may deem appropriate in establishing any performance conditions. A
Performance Award granted under the Plan (i) may be denominated or payable
in cash, shares of Common Stock (including, without limitation, Restricted
Stock), other Awards or other property, and (ii) shall confer on the holder
thereof the right to receive payments, in whole or in part, upon the achievement
of one or more performance goals during such performance periods as the
Committee may establish within the provisions of this Article VII.

    


    7.2           Performance Goals. The grant
and/or settlement of a Performance Award shall be contingent upon terms set
forth in this Section 7.2.

    


    (a)           General. The performance
goals for Performance Awards shall consist of one or more business criteria and
a targeted level or levels of performance with respect to each of such criteria,
as specified by the Committee. In the case of any Award granted to a Covered
Employee, performance goals shall be designed to be objective and shall
otherwise meet the requirements of Section 162(m) of the Code and regulations
thereunder (including Treasury Regulations sec. 1.162-27 and successor
regulations thereto), including the requirement that 

     

    
      
        
        

      

      
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    the level or levels
of performance targeted by the Committee are such that the achievement of
performance goals is “substantially uncertain” at the time of grant. The
Committee may determine that such Performance Awards shall be granted and/or
settled upon achievement of any one performance goal or that two or more of the
performance goals must be achieved as a condition to the grant and/or settlement
of such Performance Awards. Performance goals may differ among Performance
Awards granted to any one Participant or for Performance Awards granted to
different Participants.

    


    (b)           Business Criteria. One or
more of the following business criteria for the Company, on a consolidated
basis, and/or for specified subsidiaries, divisions or business or geographical
units of the Company, shall be used by the Committee in establishing performance
goals for Performance Awards granted to a Participant: (A) earnings per share;
(B) increase in price per share; (C) increase in revenues; (D) increase in cash
flow; (E) return on assets; (F) return on investments; (G) return on
equity; (H) return on net capital employed; (I) economic value added;
(J) gross margin; (K) net income; (L) earnings before interest, taxes,
depreciation, depletion and amortization; (M) earnings before interest and
taxes; (N) profit before taxes; (O) operating income; (P) total stockholder
return; (Q) debt reduction; (R) health/safety/environmental performance;
and (S) any of the above goals determined on the absolute or relative basis or
as compared to the performance of a published or special index deemed applicable
by the Committee including, but not limited to, the Standard & Poor’s 500
Stock Index, the Oil Service Index (OSX) or components thereof or a group of
comparable companies.

    


    (c)           Performance Period; Timing for
Establishing Performance Goals. Achievement of performance goals in
respect of Performance Awards shall be measured over a performance period of not
less than three months and not more than five years, as specified by the
Committee. Performance goals in the case of any Award granted to a Participant
shall be established not later than 90 days after the beginning of any
performance period applicable to such Performance Awards, or at such other date
as may be required or permitted for “performance-based compensation” under
Section 162(m) of the Code.

    


    (d)           Settlement of Performance Awards;
Other Terms. After the end of each performance period, the Committee
shall determine the amount, if any, of Performance Awards payable to each
Participant based upon achievement of business criteria over a performance
period. Except as may otherwise be required under Section 409A of the Code,
payment described in the immediately preceding sentence shall be made by the
later of (i) the date that is 2 1/2 months after the end of the Participant’s
first taxable year in which the Performance Award is earned and payable under
the Plan and (ii) the date that is 2 1/2 months after the end of the Company’s
first taxable year in which the Performance Award is earned and payable under
the Plan, and such payment shall not be subject to any election by the
Participant to defer the payment to a later period. Subject to the limitation
set forth in Section 1.3, with respect to any Performance Award payable in
shares of Common Stock, the number of shares of Common Stock deliverable shall
be determined by dividing the amount payable under a Performance Award by the
FMV Per Share of Common Stock on the determination date and a stock certificate
evidencing the resulting shares of Common Stock (to the nearest full share)
shall be delivered to the Participant, or his personal representative, and the
value of any fractional shares will be paid in cash. If at the time payment is
due with respect to any Performance Award payable in shares of Common Stock
there is not a sufficient number of shares of Common Stock available under the
Plan to pay such Performance Award fully in shares of Common Stock, the
Performance Award shall first be paid in shares of Common Stock if any, as
provided above with the remaining portion of such Performance Award payable in
cash. The Committee may not exercise discretion to increase any such amount
payable in respect of a Performance Award which is intended to comply with
Section 162(m) of the Code. The Committee shall specify the circumstances in
which such Performance Awards shall be paid or forfeited in the 

     

    
      
        
        

      

      
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    event of
termination of employment by the Participant prior to the end of a performance
period or settlement of Performance Awards.

    


    (e)           Written Determinations. All
determinations by the Committee as to the establishment of performance goals,
the amount of any Performance Award, and the achievement of performance goals
relating to Performance Awards shall be made in a written agreement or other
document covering the Performance Award. The Committee may not delegate any
responsibility relating to such Performance Awards.

    


    (f)           Status of Performance Awards Under
Section 162(m) of the Code. It is the intent of the Company that
Performance Awards granted to persons who are designated by the Committee as
likely to be Covered Employees within the meaning of Section 162(m) of the Code
and regulations thereunder (including Treasury Regulations sec. 1.162-27 and
successor regulations thereto) shall constitute “performance-based compensation”
within the meaning of Section 162(m) of the Code and regulations thereunder.
Accordingly, the terms of this Section 7.2 shall be interpreted in a manner
consistent with Section 162(m) of the Code and regulations thereunder. The
foregoing notwithstanding, because the Committee cannot determine with certainty
whether a given Participant will be a Covered Employee with respect to a fiscal
year that has not yet been completed, the term Covered Employee as used herein
shall mean any person designated by the Committee, at the time of grant of a
Performance Award, as likely to be a Covered Employee with respect to that
fiscal year. If any provision of the Plan as in effect on the date of adoption
or any agreements relating to Performance Awards that are intended to comply
with Section 162(m) of the Code does not comply or is inconsistent with the
requirements of Section 162(m) of the Code or regulations thereunder, such
provision shall be construed or deemed amended to the extent necessary to
conform to such requirements.

    


    ARTICLE
VIII

    CERTAIN
PROVISIONS APPLICABLE TO ALL AWARDS

    


    8.1           General. Awards shall be
evidenced by a written agreement or other document and may be granted on the
terms and conditions set forth herein. In addition, the Committee may impose on
any Award or the exercise thereof, such additional terms and conditions, not
inconsistent with the provisions of the Plan, as the Committee shall determine,
including terms requiring forfeiture of Awards in the event of termination of
employment by the Participant and terms permitting a Participant to make
elections relating to his or her Award; provided, that any such election would
not (i) cause the application of Section 409A of the Code to the Award or (ii)
create adverse tax consequences under Section 409A of the Code should Section
409A apply to the Award. The terms, conditions and/or restrictions contained in
an Award may differ from the terms, conditions and restrictions contained in any
other Award. The Committee may amend an Award; provided, however, subject to
Section 8.11, no amendment of an Award may, without the consent of the holder of
the Award, adversely affect such person’s rights with respect to such Award in
any material respect. The Committee shall retain full power and discretion to
accelerate or waive, at any time, any term or condition of an Award; provided,
however, that, (x) subject to Section 8.11, the Committee shall not have
any discretion to accelerate or waive any term or condition of an Award if (A)
such discretion would cause the Award to have adverse tax consequences to the
Participant under Section 409A of the Code or (B) if the Award is intended to
qualify as “performance-based compensation” for purposes of Section 162(m) of
the Code and such discretion would cause the Award not to so qualify and (y) no
exercise of such discretion shall be effective prior to approval of the
stockholders of the Company to the extent such discretion would result in the
acceleration of vesting other than upon the death, Disability or Retirement of a
Participant or in connection with a Change in Control. Except in cases in which
the Committee is authorized to require other forms of consideration under the
Plan, or to the extent other forms of consideration must be paid to satisfy the
requirements of the Delaware 

     

    
      
        
        

      

      
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    Corporation Law, no
consideration other than services may be required for the grant of any
Award.

    


    8.2           Stand-Alone, Additional and
Substitute Awards.

    


    (a)           Awards Granted by the Company and
Affiliates. Subject to the limitations on repricing set forth below and
in Sections 2.4 and 5.2 of the Plan, Awards granted under the Plan may, in the
discretion of the Committee, be granted either alone or in addition to, or in
substitution or exchange for, any other Award or any award granted under another
plan of the Company or any Affiliate, or any other right of a Participant to
receive payment from the Company or any Affiliate; provided, however, no Award
shall be issued in tandem with another Award under the Plan or in tandem or in
connection with any award granted under another plan of the Company or any
Affiliate, or any other right of a Participant to receive payment from the
Company or any Affiliate if such an issuance would result in adverse tax
consequences under Section 409A of the Code. Such additional, substitute or
exchange Awards may be granted at any time. If an Award is granted in
substitution or exchange for another Award, the Committee shall require the
surrender of such other Award for cancellation in consideration for the grant of
the new Award. In addition, Awards may be granted in lieu of cash compensation,
including in lieu of cash amounts payable under other plans of the Company or
any Affiliate. Any such action contemplated under this Section 8.2(a) shall be
effective only to the extent that such action will not cause (i) the holder of
the Award to lose the protection of Section 16(b) of the Exchange Act and rules
and regulations promulgated thereunder, (ii) any Award that is designed to
qualify payments thereunder as performance-based compensation as defined in
Section 162(m) of the Code to fail to qualify as such performance-based
compensation, (iii) any Award that is subject to Section 409A of the Code to
result in adverse consequences under Section 409A of the Code, or
(iv) accelerated vesting of any Award other than in connection with the
death, Disability or Retirement of the Participant or a Change in Control,
absent approval by the stockholders of the Company. In addition, except in
connection with a corporate transaction involving the Company (including,
without limitation, any stock dividend, stock split, extraordinary cash
dividend, recapitalization, reorganization, merger, consolidation, split-up,
spin-off, combination, or exchange of shares), the terms of outstanding Awards
may not be amended to reduce the exercise price of outstanding Options or Stock
Appreciation Rights or to cancel outstanding Options or Stock Appreciation
Rights in exchange for cash, other Awards or Options or Stock Appreciation
Rights with an exercise price that is less than the exercise price of the
original Options or Stock Appreciation Rights without prior stockholder
approval.

    


    (b)           Substitute Awards for Awards Granted
by Other Entities. The Committee shall have
the authority to grant substitute Awards under the Plan in assumption of, or in
substitution or exchange for, any options or awards previously granted by
another entity that are transferred to the Company or an Affiliate as a result
of the acquisition of, or merger, consolidation or other corporate transaction
with, such other entity by the Company or an Affiliate. The number of shares of
Common Stock covered by any such substitute Awards shall not reduce, or
otherwise be counted against, the aggregate number of shares of Common Stock
available for grant under the Plan. Except as otherwise provided by applicable
law and notwithstanding anything in the Plan to the contrary, the terms,
provisions and benefits of the substitute Awards so granted, including, without
limitation, the exercise price of any such substitute Award, may vary from those
set forth in or required by the Plan to the extent the Committee at the time of
grant may deem appropriate to conform, in whole or in part, to the terms,
provisions and benefits of the options or awards being assumed or replaced. In
addition, the date of grant of any substitute Award shall relate back to the
initial option or award being assumed or replaced, and service with the acquired
entity shall constitute service with the Company or its
Affiliate.

    


    8.3           Term of Awards. The term or
Restricted Period of each Award that is an Option, Stock Appreciation Right or
Restricted Stock shall be for such period as may be determined by 

     

    
      
        
        

      

      
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    the Committee;
provided that in no event shall the term of any such Award exceed a period of
ten (10) years (or such shorter terms as may be required in respect of an
Incentive Stock Option under Section 422 of the Code).

    


    8.4           Form
and Timing of Payment Under Awards; Deferrals.

    


    (a)           General Provisions. Subject
to the terms of the Plan and any applicable Award agreement, payments to be made
by the Company or a subsidiary upon the exercise of an Option or other Award or
settlement of an Award may be made in such form or forms as the Committee shall
determine, including, without limitation, cash, shares of Common Stock, other
Awards or other property or any combination thereof, and may be made as a single
payment or transfer, in installments, or on a deferred basis. The settlement of
any Award may, subject to any limitations set forth in the Plan and/or Award
agreement, be accelerated, in the discretion of the Committee or upon occurrence
of one or more specified events; provided, however, that such discretion may not
be exercised by the Committee if the exercise of such discretion would result in
adverse tax consequences to the Participant under Section 409A of the Code.
Installment or deferred payments may be required or permitted by the Committee
(subject to Section 1.8 of the Plan, including the consent provisions thereof in
the case of any deferral of an outstanding Award not provided for in the
original Award agreement); provided, however, that no deferral shall be required
or permitted by the Committee if such deferral would result in adverse tax
consequences to the Participant under Section 409A of the Code. Any deferral
shall only be allowed as is provided in a separate deferred compensation plan
adopted by the Company. The Plan shall not constitute an “employee benefit plan”
for purposes of Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended.

    


    (b)           Section 409A Limits on Payments to
Specified Employees. Notwithstanding any other provision of the Plan or
an Award to the contrary, if a Participant is a “key employee,” as defined in
Section 416(i) of the Code (without regard to paragraph 5 thereof), except to
the extent permitted under Section 409A of the Code, no benefit or payment that
is subject to Section 409A of the Code (after taking into account all applicable
exceptions to Section 409A of the Code, including but not limited to the
exceptions for short-term deferrals and for “separation pay only upon an
involuntary separation from service”) shall be made under this Plan or the
affected Award granted thereunder on account of the Participant’s “separation
from service,” as defined in Section 409A of the Code, with the Company and its
Affiliates until the later of the date prescribed for payment in this Plan or
the affected Award granted thereunder and the first (1st) day of the seventh
(7th) calendar month that begins after the date of the Participant’s separation
from service (or, if earlier, the date of death of the Participant). Unless
otherwise provided in the Award, any amount that is otherwise payable within the
delay period described in the immediately preceding sentence will be aggregated
and paid in a lump sum without interest.

    


    8.5           Vested and Unvested Awards.
After the satisfaction of all of the terms and conditions set by the Committee
with respect to an Award of (i) Restricted Stock, a certificate, without the
legend set forth in Section 6.2(c), for the number of shares that are no longer
subject to such restrictions, terms and conditions shall be delivered to the
Employee, and (ii) Stock Appreciation Rights or Performance Awards to be paid in
shares of Common Stock, a certificate for the number of shares equal in value to
the number of Stock Appreciation Rights or amount of Performance Awards payable
under those Awards shall be delivered to the person. The number of shares of
Common Stock which shall be issuable upon exercise of a Stock Appreciation Right
or earning of a Performance Award to be paid in shares of Common Stock shall be
determined by dividing (1) by (2) where (1) is the number of shares of Common
Stock as to which the Stock Appreciation Right is exercised multiplied by the
Spread or the amount of Performance Award that is earned and payable, as
applicable, and (2) is the FMV Per Share of Common Stock on the date of exercise
of the Stock Appreciation Right or the date the Performance Award is


     

    
      
        
        

      

      
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    determined to be
earned and payable, as applicable. Upon termination, resignation or removal of a
Participant under circumstances that do not cause such Participant to become
fully vested, any remaining unvested Options, shares of Restricted Stock, Stock
Appreciation Rights or Performance Awards, as the case may be, shall, unless
otherwise provided in this Plan, either be forfeited back to the Company or, if
appropriate under the terms of the Award, shall continue to be subject to the
restrictions, terms and conditions set by the Committee with respect to such
Award.

    


    8.6           Exemptions from Section 16(b)
Liability. It is the intent of the Company that the grant of any Awards
to or other transaction by a Participant who is subject to Section 16 of the
Exchange Act shall be exempt from Section 16(b) of the Exchange Act pursuant to
an applicable exemption (except for transactions acknowledged by the Participant
in writing to be non-exempt). Accordingly, if any provision of this Plan or any
Award agreement does not comply with the requirements of Rule 16b-3 as then
applicable to any such transaction, such provision shall be construed or deemed
amended to the extent necessary to conform to the applicable requirements of
Rule 16b-3 so that such Participant shall avoid liability under Section 16(b) of
the Exchange Act.

    


    8.7           Transferability.

    


    (a)           Non-Transferable Awards and
Options. Except as otherwise specifically provided in the Plan, no Award
and no right under the Plan, contingent or otherwise, other than Bonus Stock or
Restricted Stock as to which restrictions have lapsed, will be (i) assignable,
saleable, or otherwise transferable by a Participant except by will or by the
laws of descent and distribution or pursuant to a qualified domestic relations
order, or (ii) subject to any encumbrance, pledge or charge of any nature. No
transfer by will or by the laws of descent and distribution shall be effective
to bind the Company unless the Committee shall have been furnished with a copy
of the deceased Participant’s will or such other evidence as the Committee may
deem necessary to establish the validity of the transfer. Any attempted transfer
in violation of this Section 8.7(a) shall be void and ineffective for all
purposes.

    


    (b)           Ability to Exercise Rights.
Except as otherwise specifically provided under the Plan, only the Participant
or his guardian (if the Participant becomes Disabled), or in the event of his
death, his legal representative or beneficiary, may exercise Options, receive
cash payments and deliveries of shares, or otherwise exercise rights under the
Plan. The executor or administrator of the Participant’s estate, or the person
or persons to whom the Participant’s rights under any Award will pass by will or
the laws of descent and distribution, shall be deemed to be the Participant’s
beneficiary or beneficiaries of the rights of the Participant hereunder and
shall be entitled to exercise such rights as are provided
hereunder.

    


    8.8           Rights
as a Stockholder.

    


    (a)           No Stockholder Rights. Except
as otherwise provided in Section 8.8(b) or Section 6.2(c), a Participant who has
received a grant of an Award or a transferee of such Participant shall have no
rights as a stockholder with respect to any shares of Common Stock until such
person becomes the holder of record. Except as otherwise provided in Section
8.8(b) or Section 1.3, no adjustment shall be made for dividends (ordinary or
extraordinary, whether in cash, securities, or other property) or distributions
or other rights for which the record date is prior to the date such stock
certificate is issued.

    


    (b)           Holder of Restricted Stock.
Unless otherwise approved by the Committee prior to the grant of a Restricted
Stock Award, a Participant who has received a grant of Restricted Stock or a
permitted transferee of such Participant shall not have any rights of a
stockholder until such 

     

    
      
        
        

      

      
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    time as a stock
certificate has been issued with respect to all, or a portion of, such
Restricted Stock Award, except as otherwise provided in Section
6.2(c).

    


    8.9           Listing and Registration of Shares of
Common Stock. The Company, in its discretion, may postpone the issuance
and/or delivery of shares of Common Stock upon any exercise of an Award until
completion of such stock exchange listing, registration, or other qualification
of such shares under any state and/or federal law, rule or regulation as the
Company may consider appropriate, and may require any Participant to make such
representations and furnish such information as it may consider appropriate in
connection with the issuance or delivery of the shares in compliance with
applicable laws, rules and regulations.

    


    8.10           Termination
of Employment, Death, Disability and Retirement.

    


    (a)           Termination of Employment or
Service. Unless otherwise provided in the Award, if Employment of an
Employee or service of a Non-Employee Director or Consultant is terminated for
any reason whatsoever other than death, Disability or Retirement, any nonvested
Award granted pursuant to the Plan outstanding at the time of such termination
and all rights thereunder shall wholly and completely terminate and no further
vesting shall occur, and the Employee, Consultant or Non-Employee Director shall
be entitled to utilize his or her exercise rights with respect to the portion of
the Award vested as of the date of termination for a period that shall end on
the earlier of (i) the expiration date set forth in the Award with respect to
the  vested portion of such Award or (ii) the date that occurs three
(3) months after such termination date.

    


    (b)           Retirement. Unless otherwise
provided in the Award, upon the Retirement of a Participant:

    


    (i)           any
nonvested portion of any outstanding Award shall immediately terminate and no
further vesting shall occur; and

    


    (ii)          any
exercise rights with respect to any vested Award shall expire on the earlier of
(A) the expiration date set forth in the Award; or (B) the expiration of twelve
(12) months after the date of Retirement.

    


    (c)           Disability or Death. Unless
otherwise provided in the Award, upon termination of Employment or service from
the Company or any Affiliate which is a parent or subsidiary as a result of
Disability or death of a Participant, or with respect to a Participant who is
either a retired former Employee, Non-Employee Director or Consultant who dies
during the period described in Section 8.10(b), hereinafter the “Applicable
Retirement Period,” or a disabled former Employee, Non-Employee Director or
Consultant who dies during the period that expires on the earlier of the
expiration date set forth in any applicable outstanding Award or the first
anniversary of the person’s termination of Employment or service due to
Disability, hereinafter the “Applicable Disability Period,”

    


    (i)           any
nonvested portion of any outstanding Award that has not already terminated shall
immediately terminate and no further vesting shall occur; and

    


    (ii)          any
exercise rights with respect to any vested Award shall expire upon the earlier
of (A) the expiration date set forth in the Award or (B) the later of (1) the
first anniversary of such termination of Employment or service as a result of
Disability or death, or (2) the first anniversary of such person’s death during
the Applicable Retirement Period (except in the case of an Incentive Option) or
the Applicable Disability Period.

     

    
      
        
        

      

      
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    (d)           Acceleration of Vesting and Lapse of
Restrictions. Notwithstanding the above provisions of this Section 8.10,
upon the Retirement of a Participant, or upon termination of Employment or
service as a result of the Disability or death of a Participant, the Committee,
in its discretion and on an individual basis, may provide (i) with respect to
any Stock Option or Stock Appreciation Right, that all or a part of the unvested
portion of such Award shall become vested and, together with the previously
vested portion of the Award, shall be exercisable for such period and upon such
terms and conditions as may be determined by the Committee, provided that such
continuation may not exceed the expiration date set forth in the Award; and,
(ii) with respect to Restricted Stock, that all or a part of the unvested
portion of the Award shall become vested; provided, however, that (A) if
the Award is to a Covered Employee and intended to qualify as “performance-based
compensation” under Section 162(m) of the Code, such acceleration of
vesting and waiver of restrictions may only occur upon a termination due to
death or Disability, (B) with respect to Awards that are subject to
Section 409(A) of the Code, the Committee shall not have the authority to
accelerate the vesting or waive any restrictions, or postpone the timing of
payment or settlement of the Award in a manner that would cause such Award to
become subject to the interest and penalty provisions under Section 409A of
the Code, and (C) no acceleration of vesting described in this Section
8.10(d) shall be effective prior to the date of the Committee’s written
determination.

    


    (e)           Continuation. Notwithstanding
any other provision of the Plan, the Committee, in its discretion and on an
individual basis, may provide with respect to any Stock Option or Stock
Appreciation Right, that the vested portion of such Award shall remain
exercisable for such period and upon such terms and conditions as are determined
by the Committee in the event that a Participant ceases to be an Employee,
Consultant or Non-Employee Director; provided, however, that such continuation
may not exceed the expiration date set forth in the Award.

    


    8.11           Change
in Control

    


    (a)           Change in Control. Unless
otherwise provided in the Award, in the event of a Change in Control described
in clauses (ii), (iii) and (iv) of the definition of Change in Control under
Section 1.2 of the Plan:

    


    (i)           the
Committee may accelerate vesting and the time at which all Options and Stock
Appreciation Rights then outstanding may be exercised so that those types of
Awards may be exercised in full for a limited period of time on or before a
specified date fixed by the Committee, after which specified date all
unexercised Options and Stock Appreciation Rights and all rights of Participants
thereunder shall terminate, or the Committee may accelerate vesting and the time
at which Options and Stock Appreciation Rights may be exercised so that those
types of Awards may be exercised in full for their then remaining
term;

    


    (ii)           the
Committee may waive all restrictions and conditions of all Restricted Stock then
outstanding with the result that all restrictions shall be deemed satisfied, and
the Restriction Period shall be deemed to have expired, as of the date of the
Change in Control or such other date as may be determined by the Committee;
and

    


    (iii)           the
Committee may determine to amend Performance Awards, or substitute new
Performance Awards in consideration of cancellation of outstanding Performance
Awards, in order to ensure that such Awards shall become fully vested, deemed
earned in full and promptly paid to the Participants as of the date of the
Change in Control or such other date as may be determined by the Committee,
without regard to payment schedules and notwithstanding the applicable
performance cycle, retention cycle or other restrictions and conditions shall
not have been completed or satisfied.

     

    
      
        
        

      

      
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    Notwithstanding the
above provisions of this Section 8.11(a), the Committee shall not be required to
take any action described in the preceding provisions of this Section 8.11(a)
and any decision made by the Committee, in its sole discretion, not to take some
or all of the actions described in the preceding provisions of this Section
8.11(a) shall be final, binding and conclusive with respect to the Company and
all other interested persons.

    


    (b)           Right of Cash-Out. If
approved by the Board prior to or within thirty (30) days after such time as a
Change in Control shall be deemed to have occurred, the Board shall have the
right for a forty-five (45) day period immediately following the date that the
Change in Control is deemed to have occurred to require all, but not less than
all, Participants to transfer and deliver to the Company all Awards previously
granted to the Participants in exchange for an amount equal to the “cash value”
(defined below) of the Awards. Such right shall be exercised by written notice
to all Participants. For purposes of this Section 8.11(b), the cash value of an
Award shall equal the sum of (i) the cash value of all benefits to which the
Participant would be entitled upon settlement or exercise of any Award which is
not an Option or Restricted Stock and (ii) in the case of any Award that is an
Option or Restricted Stock, the excess of the “market value” (defined below) per
share over the option price, or the market value (defined below) per share of
Restricted Stock, multiplied by the number of shares subject to such Award. For
purposes of the preceding sentence, “market value” per share shall mean the
higher of (i) the average of the Fair Market Value Per Share of Common Stock on
each of the five trading days immediately following the date a Change in Control
is deemed to have occurred or (ii) the highest price, if any, offered in
connection with the Change in Control. The amount payable to each Participant by
the Company pursuant to this Section 8.11(b) shall be in cash or by certified
check and shall be reduced by any taxes required to be withheld.

    


    ARTICLE
IX

    WITHHOLDING
FOR TAXES

    


    Any issuance or delivery of Common Stock
pursuant to the exercise of an Option or in payment of any other Award under the
Plan shall not be made until appropriate arrangements satisfactory to the
Company have been made for the payment of any tax amounts (federal, state, local
or other) that may be required to be withheld or paid by the Company with
respect thereto at the minimum statutory rate. Such arrangements may, at the
discretion of the Committee, include allowing the person to tender to the
Company shares of Common Stock owned by the person for a period of at least
twelve months prior to the date of exercise, vesting, lapse of restriction or
payment of the Award, or to request the Company to withhold shares of Common
Stock otherwise issuable or deliverable to the Participant pursuant to the
Award, in each case which have an aggregate FMV Per Share as of the date of such
withholding that is not greater than the sum of all tax amounts to be withheld
with respect thereto at the minimum statutory rate, together with payment of any
remaining portion of such tax amounts in cash or by check payable and acceptable
to the Company.

    


    ARTICLE
X

    MISCELLANEOUS

    


    10.1           No Rights to Awards or Uniformity
Among Awards. No Participant or other person shall have any claim to be
granted any Award, there is no obligation for uniformity of treatment of
Participants, or holders or beneficiaries of Awards and the terms and conditions
of Awards need not be the same with respect to each recipient.

    


    10.2           Conflicts with Plan. In the
event of any inconsistency or conflict between the terms of the Plan and an
Award, the terms of the Plan shall govern.

     

    
      
        
        

      

      
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    10.3           No Right to Employment. The
grant of an Award shall not be construed as giving a Participant the right to be
retained in the employ of the Company or any Affiliate. Further, the Company or
any Affiliate may at any time dismiss a Participant from employment, free from
any liability or any claim under the Plan, unless otherwise expressly provided
in the Plan or in any Award.

    


    10.4           Governing Law. The validity,
construction, and effect of the Plan and any rules and regulations relating to
the Plan shall be determined in accordance with applicable federal law and the
laws of the State of Delaware, without regard to any principles of conflicts of
law.

    


    10.5           Gender, Tense and Headings.
Whenever the context requires such, words of the masculine gender used herein
shall include the feminine and neuter, and words used in the singular shall
include the plural. Section headings as used herein are inserted solely for
convenience and reference and constitute no part of the Plan.

    


    10.6           Severability. If any provision
of the Plan or any Award is or becomes or is deemed to be invalid, illegal, or
unenforceable in any jurisdiction or as to any Participant or Award, or would
disqualify the Plan or any Award under any law deemed applicable by the
Committee, such provision shall be construed or deemed amended to conform to the
applicable laws, or if it cannot be construed or deemed amended without, in the
determination of the Committee, materially altering the intent of the Plan or
the Award, such provision shall be stricken as to such jurisdiction, Participant
or Award and the remainder of the Plan and any such Award shall remain in full
force and effect.

    


    10.7           Stockholder Agreements. The
Committee may condition the grant, exercise or payment of any Award upon such
person entering into a stockholders’ or repurchase agreement in such form as
approved from time to time by the Board.

    


    10.8           Funding. Except as provided
under Article VI of the Plan, no provision of the Plan shall require or permit
the Company, for the purpose of satisfying any obligations under the Plan, to
purchase assets or place any assets in a trust or other entity to which
contributions are made or otherwise to segregate any assets, nor shall the
Company maintain separate bank accounts, books, records or other evidence of the
existence of a segregated or separately maintained or administered fund for such
purposes. Participants shall have no rights under the Plan other than as
unsecured general creditors of the Company except that insofar as they may have
become entitled to payment of additional compensation by performance of
services, they shall have the same rights as other Employees, Consultants or
Non-Employee Directors under general law.

    


    10.9           No Guarantee of Tax
Consequences. None of the Board, the Company nor the Committee makes any
commitment or guarantee that any federal, state or local tax treatment will
apply or be available to any person participating or eligible to participate
hereunder.

     

    
      
        
        

      

      
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