Document:

exv10w2

 

Exhibit 10.2

Private – Confidential

Beatriz Gutai

USA

12th May, 2005

Additional Compensation

Dear Mrs. Gutai,

Pursuant to Section 3.3 of your Employment Agreement dated 11th November,
2004, you are eligible for bonus compensation at the discretion of the Company. Please
be advised that the bonus structure has been amended as follows as from 1st
January, 2005.

	 	 	 
	Ø

	 	If during the fiscal year Jafra achieves 100% of Net Activity target
established by the Board for that fiscal year, (the “Net Activity Target”), you
will be entitled to a bonus equal to 60% of your base salary.
	 
	 	 
	Ø

	 	If the Company achieves 85% of the Net Activity Target, you are entitled to a
bonus equal to 36% of your base salary.
	 
	 	 
	Ø

	 	If Jafra achieves more than 85% of the Net Activity Target, but less than 100%
of the Net Activity Target, you are entitled to a bonus equal to the sum of (1)
36% of your base salary and (2) 1.6% of your base salary for each 1% that Jafra
exceeds 85% of such Net Activity Target.
	 
	 	 
	Ø

	 	If Jafra achieves more than 100% of the Net Activity Target, you are entitled
to a bonus equal to the sum of (1) 60% of your base salary and (2) $1,000 for each
$10,000 of Net Activity achieved by Jafra in excess of 100% of the Net Activity
Target, and (3) $250 for each $10,000 of Net Activity achieved by Jafra in excess
of 125% of the Net Activity Target, provided that the Net Activity achieved by
Jafra for purposes of the calculation under clause (2) and (3) above will be
determined after deduction of the amount payable to you pursuant to that clause
(2) and (3).
	 
	 	 
	Ø

	 	If the Net Activity achieved by Jafra is less than 85% of the Net Activity
Target, you are ineligible for any bonus.

 

 

Page 2 of letter to Beatriz Gutai

For purposes of this bonus plan, Net Activity equals Total Net Activity as that term is
defined the Rules of Vorwerk Management Reporting as of July 2004. The bonus payable
to you under this bonus plan will be paid in a lump sum no later than 30 days following
receipt by the Board of Jafra’s audited consolidated financial statements for the
relevant fiscal year. The above-described bonus plan is subject to modification by the
Company each year at its sole discretion.

Yours sincerely,

/s/ Ron Clark

/s/ Beatriz Gutai

May 26, 2005exv10w1

 

EXHIBIT 10.1

2004 WCA WASTE CORPORATION

INCENTIVE PLAN

(As Amended and Restated Effective June 1, 2005)

 

 

2004 WCA WASTE CORPORATION

INCENTIVE PLAN

(As Amended and Restated Effective June 1, 2005)

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 NON-QUALIFIED OPTIONS	 	 	8	 
	2.1
	 	Eligibility	 	 	8	 
	2.2
	 	Exercise Price	 	 	8	 
	2.3
	 	Terms and Conditions of Non-Qualified Options	 	 	8	 
	2.4
	 	Option Repricing	 	 	9	 
	2.5
	 	Vesting	 	 	10	 
	ARTICLE III NON-EMPLOYEE DIRECTOR OPTIONS	 	 	10	 
	3.1
	 	Eligibility and Maximum	 	 	10	 
	3.2
	 	Grants of Non-Employee Director Options	 	 	10	 
	3.3
	 	Exercise Price	 	 	10	 
	3.4
	 	Vesting	 	 	10	 
	ARTICLE IV INCENTIVE OPTIONS	 	 	10	 
	4.1
	 	Eligibility	 	 	11	 
	4.2
	 	Exercise Price	 	 	11	 
	4.3
	 	Dollar Limitation	 	 	11	 
	4.4
	 	10% Stockholder	 	 	11	 
	4.5
	 	Incentive Options Not Transferable	 	 	11	 
	4.6
	 	Compliance with Code Section 422	 	 	11	 
	4.7
	 	Limitations on Exercise	 	 	11	 

 

	 	 	 	 	 	 	 
	ARTICLE V PURCHASED STOCK	 	 	12	 
	5.1
	 	Eligibility	 	 	12	 
	5.2
	 	Purchase Price	 	 	12	 
	5.3
	 	Payment of Purchase Price	 	 	12	 
	ARTICLE VI BONUS STOCK	 	 	12	 
	ARTICLE VII STOCK APPRECIATION RIGHTS AND PHANTOM STOCK	 	 	12	 
	7.1
	 	Stock Appreciation Rights	 	 	12	 
	7.2
	 	Phantom Stock Awards	 	 	13	 
	ARTICLE VIII RESTRICTED STOCK	 	 	14	 
	8.1
	 	Eligibility	 	 	14	 
	8.2
	 	Restrictions, Restricted Period and Vesting	 	 	14	 
	8.3
	 	Forfeiture of Restricted Stock	 	 	14	 
	8.4
	 	Delivery of Shares of Common Stock	 	 	15	 
	ARTICLE IX PERFORMANCE AWARDS	 	 	15	 
	9.1
	 	Performance Awards	 	 	15	 
	9.2
	 	Performance Goals	 	 	15	 
	ARTICLE X OTHER STOCK OR PERFORMANCE-BASED AWARDS	 	 	17	 
	ARTICLE XI CERTAIN PROVISIONS APPLICABLE TO ALL AWARDS	 	 	17	 
	11.1
	 	General	 	 	17	 
	11.2
	 	Stand-Alone, Additional, Tandem and Substitute Awards	 	 	17	 
	11.3
	 	Term of Awards	 	 	18	 
	11.4
	 	Form and Timing of Payment under Awards; Deferrals	 	 	18	 
	11.5
	 	Vested and Unvested Awards	 	 	19	 
	11.6
	 	Exemptions from Section 16(b) Liability	 	 	19	 
	11.7
	 	Securities Requirements	 	 	19	 
	11.8
	 	Transferability	 	 	20	 
	11.9
	 	Rights as a Stockholder	 	 	20	 
	11.10
	 	Listing and Registration of Shares of Common Stock	 	 	20	 
	11.11
	 	Termination of Employment, Death, Disability and Retirement	 	 	21	 
	11.12
	 	Change in Control	 	 	22	 
	ARTICLE XII WITHHOLDING FOR TAXES	 	 	23	 

ii

 

	 	 	 	 	 	 	 
	ARTICLE XIII MISCELLANEOUS	 	 	23	 
	13.1
	 	No Rights to Awards or Uniformity Among Awards	 	 	23	 
	13.2
	 	Conflicts with Plan	 	 	23	 
	13.3
	 	No Right to Employment	 	 	23	 
	13.4
	 	Governing Law	 	 	24	 
	13.5
	 	Gender, Tense and Headings	 	 	24	 
	13.6
	 	Severability	 	 	24	 
	13.7
	 	Other Laws	 	 	24	 
	13.8
	 	Shareholder Agreements	 	 	24	 
	13.9
	 	Funding	 	 	24	 
	13.10
	 	No Guarantee of Tax Consequences	 	 	24	 

iii

 

2004 WCA WASTE CORPORATION

INCENTIVE PLAN

(As Amended and Restated Effective June 1, 2005)

ARTICLE I

INTRODUCTION

     1.1 Purpose. The 2004 WCA Waste
Corporation Incentive Plan (the “Plan”) is intended to promote the interests of WCA Waste
Corporation, 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. 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 50% 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.

     “Awards” means, collectively, Options, Purchased Stock, Bonus Stock, Stock Appreciation
Rights, Phantom Stock, Restricted Stock, Performance Awards, or Other Stock or Performance-Based
Awards.

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

     “Bonus Stock” means Common Stock described in Article VI of the Plan.

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

     (a) 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 (i) the Company or any of its
subsidiaries, (ii) any employee benefit plan of the Company or any of its subsidiaries, (iii)
any Affiliate, (iv) a company owned, directly or indirectly, by stockholders of the Company in
substantially the same proportions as their ownership of the Company or (v) 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, of
securities of the Company representing more than 50% of the shares of voting stock of the Company
then outstanding;

     (b) the consummation of any merger, organization, business combination or consolidation of the
Company or one of its subsidiaries with or into any other entity, 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;

     (c) 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;

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

     (e) 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.

     Solely with respect to any Award that is subject to Section 409A of the Code, this definition
is intended to comply with the definition of change in control under Section 409A of the Code as in
effect commencing January 1, 2005 and, to the extent that the above definition does not so comply,
such definition shall be void and of no effect and, to the extent required to ensure that this
definition complies with the requirements of Section 409A of the Code, the definition of such term
set forth in regulations or other regulatory guidance issued under Section 409A of the Code by the
appropriate governmental authority is hereby incorporated by reference into and shall form part of
this Plan as fully as if set forth herein verbatim and the Plan shall be operated in accordance
with the above definition of Change in Control as modified to the extent necessary to ensure that
the above definition complies with the definition prescribed in such regulations or other
regulatory guidance insofar as the definition relates to any Award that is subject to 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.

2

 

     “Committee” means the compensation committee of the Board which shall consist of not less than
two independent 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
independent members of 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.

     “Common Stock” means the common stock, $.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 that such services are not
in connection with the offer or sale of securities in a capital-raising transaction.

     “Covered Employee” shall mean any of the Chief Executive Officer of the Company and the four
highest paid officers of the Company other than the Chief Executive Officer, as described in
Section 162(m)(3) of the Code.

     “Disability” means an inability to perform the Employee’s or Non-Employee Director’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 Employee or Non-Employee Director (or his guardian) and the Company do not agree on a
physician, the Employee or Non-Employee Director 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.
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. Solely with respect to any Award that is subject to Section 409A of the
Code, this definition is intended to comply with the definition of disability under Section 409A of
the Code as in effect commencing January 1, 2005 and, to the extent that the above definition does
not so comply, such definition shall be void and of no effect and, to the extent required to ensure
that this definition complies with the requirements of Section 409A of the Code, the definition of
such term set forth in regulations or other regulatory guidance issued under Section 409A of the
Code by the appropriate governmental authority is hereby incorporated by reference into and shall
form part of this Plan as fully as if set forth herein verbatim and the Plan shall be operated in
accordance with the above definition of Disability as
modified to the extent necessary to ensure that the above definition complies with the
definition prescribed in such regulations or other regulatory guidance insofar as the definition
relates to any Award that is subject to Section 409A of the Code.

3

 

     “Effective Date” means, with respect to the Plan, the date that the Plan is (a) adopted by the
Board and (b) approved by shareholders of the Company, provided that such shareholder approval
occurs not more than one year prior to or after the date of such adoption. The Effective Date of
the Plan as amended and restated shall be June 1, 2005 unless otherwise indicated.

     “Employee” means any employee of the Company or an Affiliate.

     “Employment” includes 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” mean, with respect to shares of Common Stock, the fair
market value of such shares determined in good faith by the Committee, which may be conclusively
deemed by the Committee to be the closing sales price (or, if applicable, the highest reported bid
price) of a share of Common Stock on the applicable date (or if there is no trading in the Common
Stock on such date, on the next preceding date on which there was trading) as reported in The Wall

Street Journal (or other reporting service approved by the Committee). If such shares are not
publicly traded at the time a determination of its fair market value is required to be made
hereunder, the determination of fair market value shall be made in good faith by the Committee
using any fair and reasonable means selected in the Committee’s discretion.

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

     “Incumbent Board” means the Board described in paragraph (e) of the definition of Change of
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.

     “Non-Employee Director Option” means an option not intended to satisfy the requirements of
Code Section 422 and which is granted pursuant to Article III of the Plan.

     “Non-Qualified 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 Non-Qualified 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.

4

 

     “Other Stock or Performance-Based Award” means an award granted pursuant to Article X
of the Plan that is not otherwise specifically provided for, the value of which is based in whole
or in part upon the value of a share of Common Stock.

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

     “Performance Award” means an Award granted pursuant to Article IV of the Plan, which,
if earned, shall be payable in shares of Common Stock, cash or any combination thereof as
determined by the Committee.

     “Phantom Stock” means an Award, granted pursuant to Article VII of the Plan, of the
right to receive (a) shares of Common Stock issued at the end of a Restricted Period, (b) the Fair
Market Value of shares of Common Stock paid in cash at the end of a Restricted Period or (c) a
combination of shares of Common Stock and cash, as determined by the Committee, at the end of a
Restricted Period.

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

     “Purchased Stock” means a right to purchase Common Stock granted pursuant to Article V
of the Plan.

     “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 VIII of the Plan.

     “Retirement” means termination of Employment of an Employee, or if determined by the
Committee, termination of service of a Non-Employee Director, 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 7.1(a) of the Plan.

     “Stock Appreciation Rights” means an Award granted pursuant to Article VII of the
Plan.

     1.3 Shares Subject to the Plan. The
maximum number of shares of Common Stock that may be issued under the Plan shall be 1,500,000
shares. In addition, during any calendar year, the number of shares of Common Stock reserved for
issuance under the Plan which are subject to Options that may be
granted to any one Participant plus the number of such shares underlying Stock Appreciation
Rights that may be granted to that same Participant shall not exceed 200,000 shares.

5

 

     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 be ratably adjusted by the Committee.
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, the Committee shall, in such manner as it may deem equitable, adjust (a) the number of
shares of Common Stock with respect to which Awards may be granted, (b) the number of shares of
Common Stock subject to outstanding Awards and (c) the grant or exercise price with respect to an
Award. Such adjustment in an outstanding Option shall be made (i) without change in the total
price 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. The Committee’s determinations
shall be final, binding and conclusive with respect to the Company and all other interested
persons.

     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 or the
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 number of shares no longer
subject to such Award shall thereupon be released from such Award and shall thereafter be available
under the Plan for the grant of additional Awards. Shares 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 or available for any further grant under the Plan. Shares issued
pursuant to the Plan (x) may be treasury shares, authorized but unissued shares or, if applicable,
shares acquired in the open market and (y) shall be fully paid and nonassessable. No fractional
shares shall be issued under the Plan. Payment for any fractional shares that would otherwise be
issuable hereunder in the absence of the immediately preceding sentence shall be made in cash.

     1.4 Administration of the Plan.

     (a) Committee, Meetings, Rule Making and Interpretations. The Plan shall be administered by
the Committee. Subject to the provisions of the Plan, the Committee shall
(i) interpret the Plan and all Awards under the Plan, (ii) make, amend and rescind such rules
as it deems necessary for the proper administration of the Plan, (iii) make all other
determinations necessary or advisable for the administration of the Plan and (iv) 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, without
limitation, 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 the
Committee shall be liable for any action or determination made in good faith with respect to the

6

 

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 fullest extent
permitted by law.

     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 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 that 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 ninety-first (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 the tenth (10th) anniversary of the Effective Date.

     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, that subject to Section 11.12,
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 that no amendment shall be effective
prior to its approval by the stockholders of the Company, to the extent 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.

7

 

ARTICLE II

NON-QUALIFIED
OPTIONS

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

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

     2.3 Terms and Conditions of Non-Qualified Options. Non-Qualified 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 Non-Qualified Option shall
be exercisable later than the Option Expiration Date. To the extent not prohibited by other
provisions of the Plan, each Non-Qualified Option shall be exercisable at such time or times as the
Committee, in its discretion, may determine at the time such Non-Qualified Option is granted.

     (b) Manner of Exercise. In order to exercise a Non-Qualified Option, the person or persons
entitled to exercise such Non-Qualified Option 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 Non-Qualified Option
shall either be (x) in cash or by check payable and acceptable to the Company, (y) with the consent
of the Committee, which consent may be granted or withheld in the Committee’s sole discretion, 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
Non-Qualified Option is being exercised and by paying any remaining amount of the exercise price as
provided in (x) above or (z) with the consent of the Committee, which may be granted or withheld in
the Committee’s sole discretion, and upon compliance with such instructions as the Committee may
specify, at the person’s written request the Company may deliver certificates for the shares of
Common Stock for which the Non-Qualified Option is being exercised to a broker for sale on behalf
of the person, provided that the person has irrevocably instructed such broker to remit directly to
the Company on the person’s behalf from the proceeds of such sale the full amount of the exercise
price, plus all required withholding taxes. In the event that the person elects to make payment as
allowed under clause (y) above, the Committee may, upon confirming that the Optionee owns the
number of shares being tendered, authorize the issuance of a new certificate for the number of
shares being acquired pursuant to the exercise of the Non-Qualified Option, less the number of
shares being tendered upon the exercise and return to the person

8

 

(or to require surrender of) the
certificate for the shares being tendered upon the exercise. 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) Proceeds. The proceeds received from the sale of shares of Common Stock pursuant to
exercise of Non-Qualified Options exercised under the Plan will be used for general corporate
purposes.

     (d) Non-Qualified Options not Transferable. Except as provided below, no Non-Qualified 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 Non-Qualified 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 Non-Qualified 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 Non-Qualified Option with respect to the shares involved
in such attempt. With respect to a specific Non-Qualified 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 Non-Qualified Option to one or more
immediate family members or related family trusts or partnerships or similar entities as determined
by the Committee. Any Non-Qualified Option that is transferred in accordance with the provisions
of this Section 2.3(d) may only be exercised by the person or persons who acquire a
proprietary interest in the Non-Qualified Options pursuant to the transfer.

     (e) Adjustment of Non-Qualified 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, the Committee shall make appropriate and equitable adjustments to all
Non-Qualified Options then outstanding as provided in Section 1.3.

     (f) Listing and Registration of Shares. Each Non-Qualified 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 Non-Qualified 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 Non-Qualified 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 shareholder
approval, the Committee, in its absolute discretion, may grant to holders of outstanding
Non-Qualified Options, in exchange for the surrender and cancellation of such Non-Qualified
Options, new Non-Qualified Options having

9

 

exercise prices lower (or higher with any required
consent) than the exercise price provided in the Non-Qualified Options so surrendered and canceled
and containing such other terms and conditions as the Committee may deem appropriate.

     2.5 Vesting. See Section 11.11 of
the Plan for provisions on vesting in connection with termination of Employment or service. Also,
see Section 11.12 of the Plan relating to vesting in connection with a Change of Control.

ARTICLE III

NON-EMPLOYEE DIRECTOR OPTIONS

     The terms specified in this Article III shall be applicable to all Non-Employee
Director Options. Except as modified by the provisions of this Article III, all the
provisions of Article II shall be applicable to Non-Employee Director Options.

     3.1 Eligibility and Maximum. Non-Employee
Director Options may only be granted to Non-Employees Directors, and in the aggregate the maximum
number of shares of Common Stock that may be issued pursuant to Non-Employee Director Options shall
be 150,000 shares (out of the number set forth in Section 1.3 of the Plan).

     3.2 Grants of Non-Employee Director Options. The Board or the Committee may, from time to time, make additional grants of
Non-Employee Director Options.

     3.3 Exercise Price. The exercise price to be paid for each share of Common Stock deliverable upon exercise
of each Non-Employee Director Option granted under this Article III shall be the FMV Per
Share on the date of grant of such Non-Employee Director Option. The exercise price for each
Non-Employee Director Option granted under this Article III shall be subject to adjustment
as provided in Section 2.3(e) of the Plan.

     3.4 Vesting. Each Non-Employee Director
Option shall be subject to a three-year vesting schedule, pursuant to which one-third of such
Non-Employee Director Option shall become vested on the first (1st) anniversary of the
date of grant, one-third of such Non-Employee Director Option shall become vested on the second
(2nd) anniversary of the date of grant and the remaining one-third of such Non-Employee
Director Option shall become vested on the third (3rd) anniversary of the date of grant;
provided, however, that in the event that an incumbent Non-Employee Director is not
nominated for election to an additional term as a director, all Non-Employee Director Options held
by such incumbent Non-Employee Director shall immediately vest in full upon the expiration of his
then-current term of office. In addition to the foregoing, all Non-Employee Director Options shall
be subject to the provisions of Section 11.11 and Section 11.12 to the extent such
provisions do not conflict with the provisions of this Section 3.3.

ARTICLE IV

INCENTIVE OPTIONS

     The terms specified in this Article IV shall be applicable to all Incentive Options.
Except as modified by the provisions of this Article IV, all the provisions of Article
II shall be

10

 

applicable to Incentive Options. Options which are specifically designated as
Non-Qualified Options shall not be subject to the terms of this Article IV.

     4.1 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).

     4.2 Exercise Price. Subject to Section
4.4, the exercise price per share shall not be less than one hundred percent (100%) of the FMV
Per Share on the date of grant of the Incentive Option.

     4.3 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
$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.

     4.4 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 under such Incentive
Option shall not be less than one hundred ten percent (110%) of the FMV Per Share on 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.

     4.5 Incentive Options Not Transferable. No
Incentive Option granted hereunder (a) shall be transferable other than by will or by the laws of
descent and distribution and (b) 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).

     4.6 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.

     4.7 Limitations on Exercise. No Incentive
Option shall be exercisable more than 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.

11

 

ARTICLE V

PURCHASED STOCK

     5.1 Eligibility. The Committee shall have
the authority to sell shares of Common Stock to such Employees, Consultants and Non-Employee
Directors of the Company or its Affiliates as may be selected by it, on such terms and conditions
as it may establish, subject to the further provisions of this Article V. Each issuance of
Common Stock under this Article V shall be evidenced by an agreement, which shall be
subject to applicable provisions of this Plan and to such other
provisions not inconsistent with this Plan as the Committee may approve for the particular
sale transaction.

     5.2 Purchase Price. The price per share of
Common Stock to be purchased by a Participant under this Article V shall be determined in
the sole discretion of the Committee, and may be less than, but shall not greater than the FMV Per
Share at the time of purchase.

     5.3 Payment of Purchase Price. Payment of
the purchase price of Purchased Stock under this Article V shall be made in full in cash.

ARTICLE VI

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 Section 11.1.
Bonus Stock shall be shares of Common Stock that are not subject to a Restricted Period under
Article VIII.

ARTICLE VII

STOCK APPRECIATION RIGHTS AND PHANTOM STOCK

     7.1 Stock Appreciation Rights. 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 which is
equal to the excess of (i) the FMV Per Share on the date of exercise over (ii) the FMV Per Share on
the date of the grant (such excess, the “Spread”). 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.

     (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

12

 

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.

     7.2 Phantom Stock Awards. Subject to
Section 11.5 of the Plan, the Committee is authorized to grant Phantom Stock Awards to
Employees, Consultants and Non-Employee Directors, which are rights to receive cash equal to the
Fair Market Value of a specified number of shares of Common Stock at the end of a specified
deferral period, subject to the following terms and conditions:

     (a) Award and Restrictions. Satisfaction of a Phantom Stock Award shall occur upon expiration
of the deferral period specified for such Phantom Stock Award by the Committee or, if permitted by
the Committee, as elected by the Participant. In addition, Phantom Stock Awards shall be subject
to such restrictions (which may include a risk of forfeiture), if any, as the Committee may impose
in its sole discretion as set forth in the Award, which restrictions may lapse at the expiration of
the deferral period or at earlier specified times (including times based on achievement of
performance goals and/or future service requirements), separately or in combination, as the
Committee may determine in its sole discretion to be appropriate or advisable for any Award;
provided, however, that Phantom Stock Awards shall not be transferable (other than
by will or the laws of descent and distribution).

     (b) Forfeiture. Except as otherwise determined by the Committee or as may be set forth in any
Award, employment or other agreement pertaining to a Phantom Stock Award, upon termination of
employment or services during the applicable deferral period or portion thereof to which forfeiture
conditions apply, all Phantom Stock Awards that are at that time subject to deferral (other than a
deferral at the election of the Participant) shall be forfeited; provided, however,
that the Committee may provide, by rule or regulation or in any Award agreement, or may determine
in any individual case, that restrictions or forfeiture conditions relating to Phantom Stock Awards
shall be waived in whole or in part in the event of terminations resulting from specified causes,
and the Committee may in other cases which it determines appropriate or advisable waive in whole or
in part the forfeiture of Phantom Stock Awards; provided, however, no such waiver
or other change regarding an Award shall (i) cause the application of Section 162(m) or 409A of the
Code to the Award or (ii) 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.

     (c) Performance Goals. To the extent the Committee determines that any Award granted pursuant
to this Article VII shall constitute performance-based compensation for purposes of Section
162(m) of the Code, the grant or settlement of the Award shall, in the Committee’s discretion, be
subject to the achievement of performance goals determined and applied in a manner consistent with
Section 9.2.

     (d) Additional Limitations. Notwithstanding any other provision of this Section 7.2 to the
contrary, any such Phantom Stock Award granted under the Plan shall contain terms that (i) are
designed to avoid application of Section 409A of the Code to the Award or (ii) are designed to
avoid adverse tax consequences under Section 409A of the Code should that Code section apply to the
Award.

13

 

ARTICLE VIII

RESTRICTED STOCK

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

     8.2 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 cash paid
therefor, if any, 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 11.11 of the Plan for provisions on vesting in connection
with termination of Employment or service. Also, see Section 11.12 of the Plan relating to
vesting in connection with a Change of Control.

     (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, that 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 2004 WCA Waste Corporation Incentive 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 such award dated ___, 200___.

     8.3 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.

14

 

     8.4 Delivery of Shares of Common Stock.
Pursuant to Section 11.5 of the Plan and subject to the withholding requirements of
Article XII 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 IX

PERFORMANCE AWARDS

     9.1 Performance Awards. The Committee may
grant Performance Awards based on performance goals as set forth in Section 7.2 measured over a
period of not less than six months and not more than ten years.

     9.2 Performance Goals. The grant and/or
settlement of a Performance Award shall be contingent upon terms set forth in this Section
9.2.

     (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 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 (except with respect to the total stockholder return and earnings per share
criteria), shall be used by the Committee in establishing performance goals for Performance Awards
granted to a Participant: (i) earnings per share; (ii) increase in price per share, (iii) increase
in revenues; (iv) increase in cash flow; (v) return on net assets; (vi) return on assets; (vii)
return on investment; (viii) return on equity; (ix) economic value added; (x) gross
margin; (xi) net income; (xii) pretax earnings; (xiii) pretax earnings before interest,
depreciation, depletion and amortization; (xiv) pretax operating earnings after interest expense
and before incentives, service fees, and extraordinary or special items; (xv) operating income;
(xvi) total stockholder return; (xvii) debt reduction; and (xviii) 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 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

15

 

period of not less than
six months and not more than ten 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. 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 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 9.2 shall be interpreted in a manner
consistent with Section 162(m) of the Code and regulations thereunder. Notwithstanding the
foregoing, 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 only a
person designated by the Committee, at the time of grant of a Performance Award, who is 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.

16

 

ARTICLE X

OTHER STOCK OR PERFORMANCE-BASED AWARDS

     The Committee is hereby authorized to grant to Employees, Non-Employee Directors and
Consultants of the Company or its Affiliates, Other Stock or Performance-Based Awards, which shall
consist of a right which (a) is not an Award described in any other Article and (b) is denominated
or payable in, valued in whole or in part by reference to, or otherwise based on or related to,
shares of Common Stock (including, without limitation, units or securities convertible into shares
of Common Stock) or cash as are deemed by the Committee to be consistent with the purposes of the
Plan. Subject to the terms of the Plan, the Committee shall determine the terms and conditions of
any such Other Stock or Performance-Based Awards, which shall be contained in a written agreement
or other document covering such Awards. Notwithstanding any other provision of the Plan to the
contrary, any Other Stock-Based Award granted after December 31, 2004 shall contain terms that (i)
are designed to avoid application of Section 409A of the Code or (ii) are designed to avoid adverse
tax consequences under Section 409A should that Code section apply to such Award.

ARTICLE XI

CERTAIN PROVISIONS APPLICABLE TO ALL AWARDS

     11.1 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, that, subject to Section
11.12, 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 that is not mandatory under the Plan; provided, however, that, subject
to Section 11.12, the Committee shall not have any discretion to accelerate or waive any
term or condition of an Award (i) if such discretion would cause the Award to have adverse tax
consequences to the Participant under Section 409A of the Code or (ii) if the Award
is intended to qualify as “performance-based compensation” for purposes of Section 162(m) of
the Code if such discretion would cause the Award not to so qualify. 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 Corporation
Law, no consideration other than services may be required for the grant of any Award.

     11.2 Stand-Alone, Additional, Tandem and Substitute Awards. Subject to Section 2.4 of the Plan, Awards granted under the Plan may, in
the discretion of the Committee,

17

 

be granted either alone or in addition to, in tandem with, or in
substitution or exchange for, any other Award or any award granted under another plan of the
Company, any Affiliate or any business entity to be acquired by the Company or an Affiliate, or any
other right of a Participant to receive payment from the Company or any Affiliate;
provided, however, no Award shall be issued under the Plan if issuance of the Award
would result in adverse tax consequences under Section 409A of the Code. Such additional, tandem
and 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 11.2
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 or (iii) any Award that is subject to Section 409A of the Code to result in adverse
consequences under Section 409A of the Code.

     11.3 Term of Awards. The term or
Restricted Period of each Award that is an Option, Stock Appreciation Right, Phantom Stock or
Restricted Stock shall be for such period as may be determined by the Committee; provided,
however, that in no event shall the term of any such Award exceed a period of ten years (or
such shorter terms as may be required in respect of an Incentive Stock Option under Section 422 of
the Code).

     11.4 Form and Timing of Payment under Awards; Deferrals. Subject to the terms of the Plan and any applicable Award agreement, payments to
be made by the Company or an Affiliate upon the exercise of an Option or other Award or settlement
of an Award may be made in 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 Award agreement, be
accelerated and cash paid in lieu of shares in connection with such settlement, 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. In the discretion of the Committee, Awards granted pursuant to
Article VII or Article IX of the Plan may be payable in shares to the extent
permitted by the terms of the applicable Award agreement. Installment or deferred payments may be
required 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) or permitted at the election of the Participant on terms and conditions
established by the Committee; 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. Payments may include, without limitation, provisions
for the payment or crediting of reasonable interest on installment or deferred payments or the
grant or crediting of amounts in respect of installment or deferred payments denominated in shares.
Any deferral shall only be allowed as is provided in a separate deferred compensation plan adopted
by the Company. The Plan shall not constitute any “employee

18

 

benefit plan” for purposes of Section
3(3) of the Employee Retirement Income Security Act of 1974, as amended.

     11.5 Vested and Unvested Awards. After the
satisfaction of all of the terms and conditions set by the Committee with respect to an Award of
(a) Restricted Stock, a certificate, without the legend set forth in Section 8.2(c) for the
number of shares that are no longer subject to such restrictions, terms and conditions shall be
delivered to the Employee, (b) Phantom Stock, to the extent not paid in cash, a certificate for the
number of shares equal to the number of shares of Phantom Stock earned and (c) Stock Appreciation
Rights or Performance Awards, cash and/or a certificate for the number of shares equal in value to
the number of Stock Appreciation Rights or amount of Performance Awards vested 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 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 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,
Phantom Stock, Stock Appreciation Rights or Performance Awards, as the case may be, shall 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.

     11.6 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.

     11.7 Securities Requirements. No shares of
Common Stock will be issued or transferred pursuant to an Award unless and until all
then-applicable requirements imposed by federal and state securities and other laws, rules and
regulations and by any regulatory agencies having jurisdiction and by any stock market or exchange
upon which the Common Stock may be listed, have been fully met. As a condition precedent to the
issuance of shares pursuant to the grant or exercise of an Award, the Company may require the
grantee to take any reasonable action to meet such requirements. The Company shall not be
obligated to take any affirmative action in order to cause the issuance or transfer of shares
pursuant to an Award to comply with any law or regulation described in the second preceding
sentence.

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     11.8 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 Purchased Stock,
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 11.8(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.

     11.9 Rights as a Stockholder.

     (a) No Stockholder Rights. Except as otherwise provided in Section 11.9(b), 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 11.9(b), 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 time
as a stock certificate has been issued with respect to all, or a portion of, such Restricted Stock
Award.

     11.10 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.

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     11.11 Termination of Employment, Death, Disability and Retirement.

     (a) Termination of Employment. Unless otherwise provided in the Award, if Employment of an
Employee or service of a Non-Employee Director is terminated for any reason whatsoever other than
death, Disability or Retirement, or if service of a Consultant is terminated for any reason
whatsoever other than death, 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 exercise his or her 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 six (6)
months after such termination date (three (3) months after the date of termination in the case of
an Incentive Option).

     (b) Retirement. Unless otherwise provided in the Award, upon the Retirement of an Employee
or, if applicable, Non-Employee Director:

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

     (ii) any vested Award shall expire on the earlier of (A) the expiration date set forth
in the Award or (B) the expiration of (x) twelve (12) months after the date of Retirement in
the case of any Award other than an Incentive Option and (y) three (3) months after the date
of Retirement in the case of an Incentive Option.

     (c) Disability or Death. Unless otherwise provided in the Award, upon termination of
Employment or service from the Company or any Affiliate that is a parent or subsidiary of the
Company as a result of Disability of an Employee or Non-Employee Director or death of an Employee,
Non-Employee Director or Consultant, or with respect to a Participant who is either a retired
former Employee or Non-Employee Director who dies during the period described in Section
11.11(b), hereinafter the “Applicable Retirement Period,” or a disabled former Employee
or Non-Employee Director 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 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 as a result of Disability or death or (2) the first anniversary of such person’s
death during the Applicable Retirement Period or the Applicable Disability Period.

     (d) Continuation. Notwithstanding any other provision of the Plan, the Committee, in its
discretion, may provide for the continuation of any Award for such period and upon such

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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.

     11.12 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) or (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
and Phantom Stock then outstanding with the result that those types of Awards shall be
deemed satisfied, and the Restriction Period or other limitations on payment in full with
respect thereto 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 and Other Stock or
Performance-Based Awards, or substitute new Performance Awards and Other Stock or
Performance-Based Awards in consideration of cancellation of outstanding Performance Awards
and any Other Stock or Performance-Based 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 that the applicable performance
cycle, retention cycle or other restrictions and conditions shall not have been completed or
satisfied.

Notwithstanding the above provisions of this Section 11.12(a), the Committee shall not be
required to take any action described in the preceding provisions of this Section 11.12(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 11.12(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 11.12(b), the cash value of an

22

 

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 (x) 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 (y) 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 11.12(b) shall be in cash or by certified check and shall be
reduced by any taxes required to be withheld.

ARTICLE XII

WITHHOLDING FOR TAXES

     Any issuance 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, or to request the Company to withhold
shares of Common Stock being acquired pursuant to the Award, whether through the exercise of an
Option or as a distribution pursuant to the Award, 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, together with payment of any remaining portion of such tax amounts in cash or by
check payable and acceptable to the Company.

     Notwithstanding the foregoing, if on the date of an event giving rise to a tax
withholding obligation on the part of the Company the person is an officer or individual subject to
Rule 16b-3, such person may direct that such tax withholding be effectuated by the Company
withholding the necessary number of shares of Common Stock (at the minimum statutory tax rate
required by the Code) from such Award payment or exercise.

ARTICLE XIII

MISCELLANEOUS

     13.1 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.

     13.2 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.

     13.3 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,

23

 

free from any liability or any claim under the Plan, unless otherwise
expressly provided in the Plan or in any Award.

     13.4 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.

     13.5 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.

     13.6 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 as
necessary 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.

     13.7 Other Laws. The Committee may refuse
to issue or transfer any shares or other consideration under an Award if, acting in its sole
discretion, it determines that the issuance or transfer of such shares or such other consideration
might violate any applicable law.

     13.8 Shareholder 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.

     13.9 Funding. Except as provided under
Article VIII 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.

     13.10 No Guarantee of Tax Consequences.
Neither the Board, nor 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.

24

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