Company for any reason. Subject to Section 5, the Participant shall not have the rights of astockholder in respect of the shares of Common Stock underlying this Award until such Common Stockis delivered to the Participant in accordance with Section 4.     **3. ****Vesting.**          **3.1.**General. Subject to Section [     ] and Section [     ], the Restricted Stock Unitssubject to this grant shall become vested and deliverable as follows: [               ]          **3.2.**Effect of Employment Termination. Subject to Section [     ] and Section [     ], ifthe Participant’s employment with the Company and its Subsidiaries terminates for any reason priorto the full vesting of all or any portion of the Restricted Stock Units subject to this grant, suchunvested Restricted Stock Units shall immediately be cancelled and the Participant (and theParticipant’s estate, designated beneficiary or other legal representative) shall forfeit anyrights or interests in and with respect to any such unvested Restricted Stock Units.          **3.3.**Certain Transactions. If the Participant’s employer ceases to be an Affiliate orSubsidiary of the Company, that event shall be deemed to constitute a termination of employmentunder Section 3.2 above.     **4. ****Delivery of Common Stock.**          **4.1.**Settlement. Subject to the terms of the Plan, if the Restricted Stock Unitsawarded by this Agreement become vested, the Company shall promptly distribute to the Participantthe number of shares of Common Stock equal to the number of Restricted Stock Units that so vested;provided that (i) prior to a Change in Control the Company may convert each RestrictedStock Unit into a right to receive an amount of cash equal to the consideration paid for a share ofCommon Stock in connection with such Change in Control, in which case such cash shall vest and bepaid in accordance with the applicable provisions of this Agreement and (ii) to the extent requiredby Section 409A of the Code, delivery of shares of Common Stock or cash upon a Participant’s“separation from service”, within the meaning of Treas. Reg. § 1.409A-1 shall be deferred until thesix month anniversary of such separation from service. In connection with the delivery of theshares of Common Stock pursuant to this Agreement, the Participant agrees to execute any documentsreasonably requested by the Company.          **4.2.**Deferrals. If permitted by the Company, the Participant may elect, in accordancewith written plans or procedures adopted by the Company from time to time, to defer thedistribution of all or any portion of the shares of Common Stock that would otherwise bedistributed to the Participant hereunder (“Deferred Shares”). Upon the vesting ofRestricted Stock Units that have been so deferred, the applicable number of Deferred Shares shallbe credited to a bookkeeping account established on the Participant’s behalf (the“Account”). Subject to Section 5, the number of shares of Common Stock equal to the numberof Deferred Shares credited to the Participant’s Account shall be distributed to the Participant inaccordance with written plans or procedures adopted by the Company from time to time.     **5.****Dividends and Other Distributions****.**Participants holding Restricted Stock Unitsshall be entitled to receive all dividends and other distributions paid with respect to shares ofCommon Stock, provided that any such dividends or other distributions will be held by the
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Company on the Participant’s behalf subject to the same vesting requirements as the underlyingRestricted Stock Unit and shall be paid at the time the Common Stock is delivered pursuant toSection 4.     **6. ****Restrictive Covenants**. **The Participant agrees to abide by the covenants andagreements set forth in Annex A hereto and incorporated by reference herein, and acknowledges thatthe Restricted Stock Units being granted herein constitutes adequate and sufficient considerationin support of such covenants and agreements.**     **7. ****Withholding.** The Participant may direct the Company to withhold from deliveryhereunder in satisfaction of applicable tax withholding obligations shares of Common Stock havingan aggregate fair market value equal to the minimum amount of federal, state and local income andpayroll taxes required to be withheld in respect of this Award.     **8. ****Entire Agreement; Amendment****.**This Agreement, together with the Plan contains theentire agreement between the parties hereto with respect to the subject matter contained herein,and supersedes all prior agreements or prior understandings, whether written or oral, between theparties relating to such subject matter. The Committee shall have the right, in its solediscretion, to modify or amend this Agreement from time to time in accordance with and as providedin the Plan. This Agreement may also be modified or amended by a writing signed by both theCompany and the Participant. The Company shall give written notice to the Participant of any suchmodification or amendment of this Agreement as soon as practicable after the adoption thereof.     **9. ****Acknowledgment of Participant**. The grant of this award does not entitle theParticipant to any benefit other than that granted under this Agreement. Any benefits granted underthis Agreement are not part of the Participant’s ordinary salary, and shall not be considered aspart of such salary in the event of severance, redundancy or resignation. Participant understandsand accepts that the benefits granted under the Plan and this Agreement are entirely at thediscretion of the Company.     **10. ****Governing Law****.**This Agreement shall be governed by and construed in accordancewith the laws of the State of Delaware without reference to the principles of conflict of lawsthereof.     **11. ****Compliance with Laws****.**The issuance of the shares of Common Stock pursuant to thisAgreement shall be subject to, and shall comply with, any applicable requirements of any federaland state securities laws, rules and regulations (including, without limitation, the provisions ofthe Act, the Exchange Act and the respective rules and regulations promulgated thereunder) and anyother law or regulation applicable thereto. The Company shall not be obligated to issue any of theshares of Common Stock pursuant to this Agreement if such issuance would violate any suchrequirements.     **12. ****Headings****.**The titles and headings of the various sections of this Agreement havebeen inserted for convenience of reference only and shall not be deemed to be a part of thisAgreement.
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          IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its dulyauthorized officer, and the Participant has hereunto set his/her hand, all as of the Grant Datespecified above.        **HORSEHEAD HOLDING CORP.**            By:           Name: ___________________________    Title: ___________________________            **PARTICIPANT:**              Name: ___________________________    Title: ___________________________
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**ANNEX A****COVENANTS AND AGREEMENTS OF THE PARTICIPANT**     1. The Participant acknowledges the time and expense incurred by the Company, its Subsidiariesand their respective affiliates (the “Company Group”) in connection with developingproprietary and confidential information in connection with the business and operations of theCompany and its Subsidiaries. The Participant agrees that the Participant will not, whether duringthe Participant’s service as an employee of any member of the Company Group or at any timethereafter, divulge, communicate, or use to the detriment of any of member of the Company Group orany other person, firm or entity, confidential information or trade secrets relating to any memberof the Company Group, including, without limitation, business strategies, operating plans,acquisition strategies (including the identities of (and any other information concerning) possibleacquisition candidates), financial information, market analyses, acquisition terms and conditions,personnel information, know-how, customer lists and relationships, supplier lists andrelationships, or other non-public proprietary and confidential information relating to any memberof the Company Group. The foregoing confidentiality agreement shall not apply if the communication(i) is required in the course of performing the Participant’s duties as an employee of the Companyor its Subsidiaries, (ii) is made with the written consent of the Company’s Board of Directors,(iii) relates to information that is or becomes generally known by the public other than as aresult of a breach hereof by the Participant, or (iv) is required by law or judicial oradministrative process.     2. During the Participant’s service as an employee of the Company or its Subsidiaries and for24 months thereafter, the Participant shall not, to the detriment of any member of the CompanyGroup, directly or indirectly, for the Participant or on behalf of any other person, firm orentity: (i) solicit, hire, employ, engage, retain or enter into a business affiliation with anyperson who at any time during the preceding 12 month period was an employee of, the Company or anyof its Subsidiaries, or (ii) encourage, induce or attempt to encourage or induce any person who atany time during the preceding 12 month period was a supplier or customer of the Company or any ofits Subsidiaries to cease doing business with the Company or any of its Subsidiaries or to decreasethe amount of business such supplier or customer does with the Company or any of its Subsidiaries.     3. During the Participant’s service as an employee of the Company or its Subsidiaries and for24 months thereafter (or for such longer period during which the Participant receives severancefrom the Company) (as applicable, the “Restricted Period”), the Participant shall not,directly or indirectly, engage in, or serve as a principal, partner, joint venturer, member,manager, trustee, agent, stockholder, director, officer or employee of, or advisor to, or in anyother capacity, or in any manner, own, control, manage, operate, or otherwise participate, invest,or have any interest in, or be connected with, any person, firm or entity that engages in anyactivity which competes directly or indirectly with any business of the Company or its Subsidiaries(collectively, the “Company Business”) anywhere in the United States of America or anyother country in which the Company Business was conducted or related sales were effected during thetwo years preceding the Participant’s termination of employment. THIS PARAGRAPH 3 WILL NOT APPLYAND WILL NOT BE ENFORCED BY THE COMPANY WITH RESPECT TO POST-TERMINATION ACTIVITY BY PARTICIPANTTHAT
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OCCURS IN CALIFORNIA OR IN ANY OTHER STATE IN WHICH THIS PROHIBITION IS NOT ENFORCEABLE UNDERAPPLICABLE LAW.     4. Whether during or after the term of the Participant’s employment or service, theParticipant shall not disparage, defame or discredit any member of the Company Group or engage inany activity which would have the effect of disparaging, defaming or discrediting any member of theCompany Group.     5. The Participant acknowledges that the Participant’s service as an employee of the Companyor its Subsidiaries, as the case may be, and the agreements herein are reasonable and necessary forthe protection of the Company Group and are an essential inducement to the Company’s grant of theRestricted Stock Units. Accordingly, the Participant shall be bound by the provisions hereof tothe maximum extent permitted by law, it being the intent and spirit of the parties that theforegoing shall be fully enforceable.     6. In signing this Agreement, the Participants gives the Company assurance that theParticipant has carefully read and considered all the terms and conditions of this Agreement,including the restraints imposed on the Participant under this Annex A. The Participant agreesthat these restraints are necessary for the reasonable and proper protection of the Company Groupand their trade secrets and confidential information and that each and every one of the restraintsis reasonable in respect to subject matter, length of time and geographic area, and that theserestraints, individually or in the aggregate, will not prevent the Participant from obtaining othersuitable employment during the period in which the Participant is bound by the restraints. theParticipant agrees that, before providing services, whether as an employee or consultant, to anyentity during the Restricted Period, the Participant will provide a copy of this Annex A to suchentity. The Participant further acknowledges that each of these covenants has a unique, verysubstantial and immeasurable value to the Company Group, that the Participant has sufficient assetsand skills to provide a livelihood while such covenants remain in force and that, as a result ofthe foregoing, in the event that the Participant breaches such covenants, monetary damages would bean insufficient remedy for the Company Group and equitable enforcement of the covenant would beproper. The Participant therefore agrees that each member of the Company Group, in addition to anyother remedies available to it, will be entitled to preliminary and permanent injunctive reliefagainst any breach by the Participant of any of those covenants, without the necessity of showingactual monetary damages or the posting of a bond or other security. The Participant and theCompany further agrees that, in the event that any provision of this Annex A is determined by anycourt of competent jurisdiction to be unenforceable by reason of its being extended over too greata time, too large a geographic area or too great a range of activities, that provision will bedeemed to be modified to permit its enforcement to the maximum extent permitted by law. TheParticipant further covenants that the Participant will not challenge the reasonableness orenforceability of any of the covenants set forth in this Annex A.
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