Document:

Exhibit 4.2

Exhibit 4.2

PROSPECT GLOBAL RESOURCES INC.

2011 Director and Consultant Equity Incentive Plan

Effective Date: August 22, 2011

Any statements regarding tax matters made herein, including any attachments, cannot be relied upon
by any person to avoid tax penalties and are not intended to be used or referred to in any
marketing or promotional materials. To the extent this communication contains a tax statement or
tax advice, Brownstein Hyatt Farber Schreck, LLP does not and will not impose any limitation on
disclosure of the tax treatment or tax structure of any transactions to which the tax statement or
tax advice relates.

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	 
	 	 	 	 
	INTRODUCTION
	 	 	1	 
	 
	 	 	 	 
	ARTICLE 1 DEFINITIONS
	 	 	1	 
	 
	 	 	 	 
	ARTICLE 2 TERM OF THE PLAN
	 	 	5	 
	 
	 	 	 	 
	ARTICLE 3 ADMINISTRATION
	 	 	5	 
	 
	 	 	 	 
	3.1 Administrator
	 	 	5	 
	3.2 Meetings and Actions
	 	 	5	 
	3.3 Powers of Administrator
	 	 	6	 
	3.4 Discretion of Administrator
	 	 	6	 
	3.5 Delegation of Authority
	 	 	6	 
	 
	 	 	 	 
	ARTICLE 4 STOCK SUBJECT TO THE PLAN
	 	 	7	 
	 
	 	 	 	 
	4.1 Plan Limit
	 	 	7	 
	4.2 Unused Stock
	 	 	7	 
	4.3 Retention of Rights
	 	 	7	 
	 
	 	 	 	 
	ARTICLE 5 GRANT OF AWARDS
	 	 	8	 
	 
	 	 	 	 
	5.1 Eligibility for Award
	 	 	8	 
	5.2 Grant of Awards
	 	 	8	 
	5.3 Terms of Awards
	 	 	8	 
	5.4 Limitations Applicable to Section 16 Persons
	 	 	8	 
	5.5 Stand-Alone and Tandem Awards
	 	 	8	 
	 
	 	 	 	 
	ARTICLE 6 VESTING OF AWARDS
	 	 	8	 
	 
	 	 	 	 
	ARTICLE 7 STOCK OPTIONS
	 	 	9	 
	 
	 	 	 	 
	7.1 Option Award Agreement
	 	 	9	 
	7.2 Manner of Exercise
	 	 	10	 
	7.3 Payment of Option Price
	 	 	10	 
	 
	 	 	 	 
	ARTICLE 8 STOCK APPRECIATION RIGHTS
	 	 	11	 
	 
	 	 	 	 
	8.1 Stock Appreciation Rights Award Agreement
	 	 	11	 
	8.2 Manner of Exercise
	 	 	11	 
	 
	 	 	 	 
	ARTICLE 9 RESTRICTED STOCK
	 	 	12	 
	 
	 	 	 	 
	9.1 Restricted Stock Award Agreement
	 	 	12	 
	 
	 	 	 	 
	ARTICLE 10 OTHER AWARDS
	 	 	13	 
	 
	 	 	 	 
	10.1 Bonus Stock Awards
	 	 	13	 
	10.2 Restricted Stock Unit Award
	 	 	13	 
	10.3 Other Awards
	 	 	13	 

 

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TABLE OF CONTENTS
(continued)

	 	 	 	 	 
	 	 	Page	 
	 
	 	 	 	 
	ARTICLE 11 ISSUANCE OF SHARES
	 	 	14	 
	 
	 	 	 	 
	11.1 Stock Certificates
	 	 	14	 
	11.2 Nontransferability
	 	 	14	 
	11.3 Paperless Administration
	 	 	15	 
	 
	 	 	 	 
	ARTICLE 12 TERMINATION OF CONTINUOUS SERVICE
	 	 	15	 
	 
	 	 	 	 
	12.1 Effect of Termination of Continuous Service
	 	 	15	 
	12.2 Effect of Termination of Continuous Service on Stock
	 	 	16	 
	 
	 	 	 	 
	ARTICLE 13 REORGANIZATION, RECAPITALIZATION AND CHANGE IN CONTROL
	 	 	17	 
	 
	 	 	 	 
	13.1 Adjustments to Common Stock
	 	 	17	 
	13.2 Recapitalization
	 	 	17	 
	13.3 Change in Control
	 	 	17	 
	13.4 Other Events
	 	 	18	 
	13.5 No Adjustment for Certain Awards
	 	 	18	 
	 
	 	 	 	 
	ARTICLE 14 AMENDMENT AND TERMINATION
	 	 	18	 
	 
	 	 	 	 
	14.1 Amendment of the Plan
	 	 	18	 
	14.2 Termination of the Plan
	 	 	18	 
	 
	 	 	 	 
	ARTICLE 15 GENERAL PROVISIONS
	 	 	19	 
	 
	 	 	 	 
	15.1 Tax Obligations
	 	 	19	 
	15.2 Section 409A
	 	 	19	 
	15.3 Rule 16b-3
	 	 	19	 
	15.4 Section 162(m)
	 	 	20	 
	15.5 Section 13(k)
	 	 	21	 
	15.6 Beneficiary Designations
	 	 	21	 
	15.7 No Employment Rights
	 	 	21	 
	15.8 Jurisdictions
	 	 	21	 
	15.9 Foreign Currency
	 	 	21	 
	15.10 Other Benefits
	 	 	22	 
	15.11 Confidentiality of Information
	 	 	22	 
	15.12 No Funding
	 	 	22	 
	15.13 Severability
	 	 	22	 
	15.14 Governing Law and Venue
	 	 	22	 
	15.15 Use of Proceeds
	 	 	22	 
	15.16 Appendices
	 	 	22	 
	15.17 Indemnification
	 	 	22	 

 

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PROSPECT GLOBAL RESOURCES INC.

2011 Director and Consultant Equity Incentive Plan

INTRODUCTION

Prospect Global Resources Inc., a Nevada corporation (the “Company”), hereby adopts the Prospect
Global Resources Inc. 2011 Director and Consultant Equity Incentive Plan (the “Plan”). The purpose
of the Plan is to further the growth and development of the Company by affording an opportunity for
stock ownership to selected Directors and Consultants of the Company and its Affiliates (all as
defined below) who are involved in endeavors significant to the Company’s success. The Plan is
also intended to assist the Company in attracting new Directors and Consultants and retaining
existing Directors and Consultants; to encourage growth of the Company through incentives that are
consistent with the Company’s goals; and to promote teamwork.

ARTICLE 1

DEFINITIONS

When used in this Plan, the following capitalized terms shall have the meanings set forth below
unless a different meaning is plainly required by the context:

	1.1	 	Administrator means the Board of Directors, any committee or such delegates as shall be
administering the Plan in accordance with Article 3.

	1.2	 	Affiliate means any corporation, partnership, limited liability company or partnership,
association, trust or other organization which, directly or indirectly, controls, is
controlled by, or is under common control with, the Company. For purposes of this definition,
“control” (including, with correlative meanings, the terms “controlled by” and “under common
control with”), as used with respect to any entity or organization, shall mean the possession,
directly or indirectly, of the power to vote more than 50% of the securities having ordinary
voting power for the election of directors of the controlled entity or organization, or to
direct or cause the direction of the management and policies of the controlled entity or
organization, whether through the ownership of voting securities or by contract or otherwise.

	1.3	 	Applicable Laws means the requirements relating to the administration of stock option and
stock award plans under U.S. federal, state and local laws, the rules of any national
securities exchange or automated quotation system on which the Common Stock is listed, quoted,
or traded to the extent provided under the terms of the Company’s agreement with such exchange
or quotation system and, with respect to Awards subject to the laws of any foreign
jurisdiction where Awards are, or will be, granted under the Plan, the laws of such
jurisdiction.

	1.4	 	Award means a grant of Options, SARs, Restricted Stock, Restricted Stock Units, Bonus Stock
or other equity-based grant under the Plan.

 

 

 

	1.5	 	Award Agreement means the agreement between the Company and a Participant pursuant to which a
specific Award is granted to the Participant.

	 
	1.6	 	Board of Directors means the Board of Directors of the Company.

	1.7	 	Bonus Stock means shares of Common Stock granted to a Participant that are subject to the
terms set forth in Section 10.2 and the applicable Award Agreement.

	1.8	 	Cause means “Cause,” as defined in the Participant’s employment agreement, if applicable, or
if the Participant has not entered into an employment agreement with the Company, as
determined in the sole discretion of the Company, a termination on account of any of the
following: (a) repeated refusal to obey written directions of the Board of Directors or a
superior officer (so long as such directions do not involve illegal or immoral acts), (b)
negligence or willful misconduct in the performance of Participant’s duties, as reasonably
directed by the Board of Directors or a superior officer, injurious to the reputation,
business or operations of the Company or an Affiliate; (c) misappropriation of any funds or
assets of the Company or an Affiliate for personal use; (d) repeated acts of substance abuse
that are injurious to the Company or an Affiliate; (e) fraud or dishonesty that is injurious
to the Company or an Affiliate; (f) a breach of any material obligation of Participant in an
employment, non-disclosure or confidentiality, non-compete, non-solicitation or similar
agreement, if applicable, with the Company or an Affiliate; (g) commission of a criminal
offense involving money or other property with respect to the Company, an Affiliate or any
supplier or customer of the Company or an Affiliate (excluding any traffic violations or
similar violations); (h) commission of a criminal offense that constitutes a felony in the
jurisdiction in which the offense is committed; or (i) engaging in any conduct tending to
bring the Company or an Affiliate into public disgrace or disrepute. A Participant who agrees
to resign from his employment or service with the Company in lieu of being terminated for
Cause may be deemed by the Administrator to have been terminated for Cause for purposes of the
Plan.

	1.9	 	Change in Control means, unless such term or an equivalent term is otherwise defined with
respect to an Award by the Participant’s Award Agreement or written contract of employment or
service, (A) by a transaction or series of transactions, any “person” or “group” (within the
meaning of Section 13(d) and 14(d)(2) of the Exchange Act) becomes the “beneficial owner” (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of more than 35% of the
combined voting power of the Company’s then outstanding securities (provided such person or
group was not a beneficial owner of more than 35% of the combined voting power of the
Company’s then outstanding securities as of August 17, 2010); (B) as a result of any merger,
consolidation, combination or sale or issuance of securities of the Company, or as a result of
or in connection with a contested election of directors, the persons who were directors of the
Company as of August 17, 2010 cease to constitute a majority of the Board of Directors; or (C)
by a transaction or series of transactions, the authority of the Board of Directors over any
activities of the Company becomes subject to the consent, agreement or cooperation of a third
party other than shareholders of the Company.

	1.10	 	Code means the Internal Revenue Code of 1986, as amended from time to time.

 

2

 

	1.11	 	Common Stock or Stock means the Company’s common stock, par value $0.001 per share, and any
share or shares of the Company’s capital stock hereafter issued or issuable in substitution
for such shares.

	1.12	 	Consultant shall mean any individual who is neither an Employee nor a Director who is engaged
by the Company or an Affiliate to render services to such entity as an advisor or consultant.

	1.13	 	Continuous Service means that the Participant’s service as a Director or Consultant with the
Company or an Affiliate is not interrupted or terminated. The Participant’s Continuous
Service shall not be deemed to have terminated merely because of a change in the capacity in
which the Participant renders service to the Company or an Affiliate or a change in the entity
for which the Participant renders such service, provided that there is no interruption or
termination of the Participant’s Continuous Service. The Administrator, in its sole
discretion, may determine whether Continuous Service shall be considered interrupted in the
case of any leave of absence, including sick leave, military leave or any other personal
leave.

	1.14	 	Director means an individual who is a member the Board of Directors or a member of the board
of directors of an Affiliate, who (in either case) is not an Employee.

	1.15	 	Disability means disability within the meaning of the long-term disability policy maintained
by the Company, or if none, within the meaning of Code Section 22(e)(3), provided that the
Administrator in its discretion may determine whether a permanent and total disability exists
in accordance with uniform and non-discriminatory standards adopted by the Administrator from
time to time.

	1.16	 	Effective Date means the date the Plan is approved by the Board, subject to approval of the
Plan by the Company’s stockholders.

	1.17	 	Employee means a common law employee of the Company or an Affiliate and any person who has
accepted a binding offer of employment from the Company or an Affiliate, but excludes any
individual classified by the Company or an Affiliate as an independent contractor, consultant
or leased employee.

	 
	1.18	 	Exchange Act means the Securities Exchange Act of 1934, as amended from time to time.

	1.19	 	Fair Market Value means, as of any specified date, the value of a share of Common Stock
determined as follows:

	 	(a)	 	Publicly Traded. If the Common Stock is regularly traded on any
established securities market, the Fair Market Value per share of Common Stock shall be
the closing sale price for a share of Common Stock for such date, or if there is no
closing sales price for a share of Common Stock on that date, the closing sales price
for a share of Common Stock on the last preceding date for which such quotation exists,
as reported in The Wall Street Journal or such other source as the Administrator deems
reliable.

 

3

 

	 	(b)	 	Not Publicly Traded. If the Common Stock is not readily tradable on an
established securities market, the Fair Market Value per share of Common Stock shall be
the amount determined by the Administrator, reasonably and in good faith, in accordance
with Applicable Laws.

	1.1	 	Full Value Award means any Award other than (i) an Option, (ii) a SAR or (iii) any other
Award for which the Participant pays the intrinsic value existing as of the date of grant
(whether directly or by forgoing a right to receive a payment from the Company or an
Affiliate).

	 
	1.2	 	Option means any option granted to a Participant under the Plan.

	1.3	 	Participant means any Director or Consultant who is granted an Award under the Plan.
Participant also means the personal representative of a Participant and any other person who
acquires the right to exercise or receive payment pursuant to an Award by bequest or
inheritance.

	1.4	 	Permitted Transferee means, with respect to a Participant, any “family member” of the
Participant, as defined under the instructions to use of the Form S-8 Registration Statement
under the Securities Act, after taking into account any state, federal, local or foreign tax
and securities laws applicable to transferable Awards.

	1.5	 	Publicly Traded means that the Company or an Affiliate has issued any class of common equity
securities registered under Section 12 of the Exchange Act.

	1.6	 	Restricted Stock means shares of Common Stock granted to a Participant that are subject to
the restrictions set forth in Section 9.1 and the applicable Award Agreement. Restricted
Stock also means any shares of the Company’s capital stock issued as a result of a dividend on
or split of Restricted Stock. Upon termination of the restrictions, such Common Stock or
other capital stock shall no longer be Restricted Stock.

	1.7	 	Restricted Stock Units means restricted share units granted to a Participant that are subject
to the terms set forth in Section 10.2 and the applicable Award Agreement.

	1.8	 	Restriction Period means the period set forth in the applicable Award Agreement that is the
period beginning on the date of grant of the Award and ending on the final vesting date of the
Restricted Stock.

	1.9	 	Rule 16b-3 means Rule 16b-3 promulgated by the Securities and Exchange Commission under the
Exchange Act, together with any successor rule, as in effect from time to time.

	1.10	 	Section 162(m) means Code Section 162(m) and any related Treasury regulations promulgated or
Internal Revenue Service guidance issued thereunder.

	1.11	 	Section 409A means Code Section 409A and any related Treasury regulations promulgated or
Internal Revenue Service guidance issued thereunder, including, without limitation, any such
regulations or other guidance that may be issued after the Effective Date.

 

4

 

	1.12	 	Securities Act shall mean the Securities Act of 1933, as amended.

	1.13	 	Stock Appreciation Right or SAR means a stand-alone stock appreciation right that is subject
to the terms set forth in Section 8.1 and the applicable Award Agreement

ARTICLE 2

TERM OF THE PLAN

The Plan shall be effective as of the Effective Date, provided that the Plan is approved by the
stockholders of the Company on or within 12 months of the Effective Date. The Plan shall continue
in effect for a term of 10 years from the later of the Effective Date or the date any amendment to
add shares to the Plan is approved by stockholders of the Company, unless terminated earlier under
Article 14.

ARTICLE 3

ADMINISTRATION

	3.1	 	Administrator. The Plan shall be administered by the Board of Directors,
unless and until such time as the Board of Directors delegates the administration of the Plan
to a committee, which shall be appointed by and shall serve at the pleasure of the Board of
Directors. The powers, duties and procedures of any appointed committee shall be governed its
adopted charter, or in the absence of such charter, by this article. Any committee member
shall be deemed to have resigned automatically from the committee upon his termination of
service with the Company. To the extent the Administrator considers it desirable for
transactions relating to a grant of Awards to be eligible to qualify for an exemption under
Rule 16b-3, the Administrator shall consist of a committee of two or more members of the
Board, all of whom qualify as “non-employee directors” within the meaning of Rule 16b-3. To
the extent the Administrator considers it desirable for compensation delivered pursuant to a
grant of Awards to be eligible to qualify for an exemption under Section 162(m), the Plan
shall be administered by a committee of two or more members of the Board, all of whom qualify
as “outside directors” within the meaning of Section 162(m). The Administrator may from time
to time remove members from or add members to any such committee; fill vacancies on the
committee, howsoever caused; and otherwise increase or decrease the number of members of such
committee, in each case as the Administrator deems appropriate to permit transactions in
Common Stock pursuant to the Plan and to satisfy such conditions of Rule 16b-3 or Section
162(m) as then in effect.

	3.2	 	Meetings and Actions. The Administrator shall hold meetings at such times
and places as it may determine in its sole discrimination. A majority of the members of the
Administrator shall constitute a quorum, and the acts of the majority of the members present
at a meeting or a consent in writing signed by all members of the Administrator shall be the
acts of the Administrator and shall be final, binding and conclusive upon all persons,
including the Company, its Affiliates, its stockholders, and all persons having any interest
in Awards that may be or have been granted pursuant to the Plan.

 

5

 

	3.3	 	Powers of Administrator. The Administrator shall have the full and
exclusive right to grant and determine terms and conditions of all Awards granted under the
Plan and to prescribe, amend and rescind rules and regulations for administration of the Plan.
The Administrator may from time to time in its discretion determine which of the eligible
Directors and Consultants of the Company or its Affiliates should receive Awards, the type of
Awards to be granted, and as applicable, the number of shares subject to the Awards, the grant
dates, the exercise or purchase price for shares subject to the Awards, the vesting conditions
and duration of the Awards and the restrictions applicable to each grant of shares pursuant to
the Awards. In selecting Participants and granting Awards, the Administrator shall take into
consideration the contribution the Participant has made or may make to the success of the
Company or its Affiliates and such other factors as the Administrator shall determine.

	3.4	 	Discretion of Administrator. The determination of the Administrator as to
any disputed question arising under the Plan, including questions of construction and
interpretation, shall be final, binding and conclusive upon all persons, including the
Company, its Affiliates, its stockholders, and all persons having any interest in Awards that
may be or have been granted pursuant to the Plan. Subject to the express provisions of the
Plan, the Administrator is authorized, in its sole discretion, to construe the Plan and the
respective Award Agreements executed hereunder, to prescribe and enforce such rules and
regulations relating to the Plan as it may deem advisable to carry out the intent of the Plan,
and to determine and amend, subject to the provisions of Article 14, the terms, restrictions
and provisions of any outstanding Award in any manner that is not inconsistent with the
provisions of the Plan (including but not limited to cashing out Awards, extending the
exercise or effective periods of Awards, accelerating the vesting of Awards, and converting or
substituting any or all stock options, stock appreciation rights or other stock awards held by
service providers of an entity acquired by the Company) the terms, restrictions and provisions
of each Award, including such terms, restrictions and provisions as shall be requisite in the
judgment of the Administrator to cause designated Awards to qualify for specific tax
treatment, and to make all other determinations necessary or advisable for administering the
Plan. The Administrator may correct any defect or supply any omission or reconcile any
inconsistency in any Award Agreement in the manner and to the extent it shall deem expedient
to carry it into effect. The determinations of the Administrator on any Plan matters shall be
final, conclusive and binding on all parties.

	3.5	 	Delegation of Authority. To the extent permitted by Applicable Laws, the
Administrator may from time to time delegate to a committee of one or more members of the
Board of Directors or one or more officers of the Company the authority to grant or amend
Awards; provided, however, that in no event shall an officer of the Company be delegated the
authority to grant awards to, or amend awards held by, individuals who are subject to Section
16 of the Exchange Act; provided further, that any delegation of administrative authority
shall only be permitted to the extent it is permissible under Section 162(m) and other
Applicable Laws. Any delegation hereunder shall be subject to the restrictions and limits
that the Administrator specifies at the time of such delegation, and the Administrator may at
any time rescind the authority so delegated or appoint a
new delegatee. At all times, the delegatee appointed under this section shall serve in such
capacity at the pleasure of the Administrator.

 

6

 

ARTICLE 4

STOCK SUBJECT TO THE PLAN

	4.1	 	Plan Limit.

	 	(a)	 	Aggregate Limit. Subject to the provisions of Article 13, the aggregate number
of shares of Common Stock that may be issued under Awards granted pursuant to the Plan
shall not exceed 2,500,000 shares of Common Stock. Such shares of Common Stock shall be
authorized but unissued shares. Shares of Common Stock shall be deemed to have been
issued under the Plan solely to the extent actually issued and delivered pursuant to an
Award. Shares of Common Stock subject to Awards granted under the Plan that are
cancelled, expire or are forfeited shall be available for re-grant under the Plan. If
a Participant pays the exercise or purchase price of an Award granted under the Plan
through the tender or withholding of shares, or if shares are tendered or withheld to
satisfy any Company withholding obligations, the number of shares so tendered or
withheld shall become available for re-issuance thereafter under the Plan.

	 	(b)	 	Section 162(m) Limit. During any single calendar year, no Participant shall be
eligible to be granted Awards exceeding 1,000,000 shares of Common Stock.

	4.2	 	Unused Stock. Shares will be deemed to have been issued under the Plan only
(a) to the extent actually issued and delivered pursuant to an Award, or (b) to the extent an
Award is settled in cash. If any outstanding Award under the Plan expires or for any other
reason ceases to be exercisable, is forfeited or repurchased by the Company, in whole or in
part (other than upon exercise of an Award), the shares that were subject to such Award (and
as to which the Award had not been exercised) shall continue to be available under the Plan or
revert to the Plan to again be available for issuance under the Plan. Any shares of Common
Stock tendered or withheld to satisfy the grant or exercise price or tax withholding
obligation pursuant to any Award (other than an Option) shall again be available
for the grant of an Award pursuant to the Plan.

	4.3	 	Retention of Rights. The existence of this Plan and any Award granted
pursuant to the Plan shall not affect the right or power of the Company or its stockholders to
make or authorize any or all adjustments, recapitalizations, reorganizations, or other change
in the Company’s capital structure or its business, or a merger or consolidation of the
Company, or any issue of bonds, debentures, or preferred or preference stock ranking before or
affecting the Common Stock, or the dissolution of the Company or any sale or transfer of all
or any part of the Company’s assets or business, or any other corporate act or proceeding,
whether similar or not.

 

7

 

ARTICLE 5

GRANT OF AWARDS

	5.1	 	Eligibility for Award. Awards may be granted only to persons who, at the
time of grant, are Directors or Consultants.

	5.2	 	Grant of Awards. The Administrator may from time to time in its discretion
grant Awards to one or more Directors or Consultants determined by it to be eligible for
participation in the Plan in accordance with the provisions of this article. No Award shall
be enforceable under the Plan until the Participant provides the Company with a signed Award
Agreement in the form specified by the Administrator with respect to the Award to that
Participant.

	5.3	 	Terms of Awards. Each Award will be evidenced by an Award Agreement in such
form and containing such provisions not inconsistent with the provisions of the Plan as the
Administrator from time to time will approve. The terms of any Award need not be identical to
the terms of any other Award to the same or other Participants. An Award may be granted on
more than one occasion to the same person, and, subject to the limitations set forth in the
Plan, such Award may include any type of Award or any combination of Awards under the Plan.
Award Agreements evidencing Awards intended to qualify as Performance-Based Compensation shall
contain such terms and conditions as may be necessary to meet the applicable provisions of
Section 162(m).

	5.4	 	Limitations Applicable to Section 16 Persons. Notwithstanding any other
provision of the Plan, the Plan, and any Award granted or awarded to any individual who is
then subject to Section 16 of the Exchange Act, shall be subject to any additional limitations
set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including
Rule 16b-3 of the Exchange Act and any amendments thereto) that are requirements for the
application of such exemptive rule. To the extent permitted by Applicable Laws, the Plan and
Awards granted or awarded hereunder shall be deemed amended to the extent necessary to conform
to such applicable exemptive rule.

	5.5	 	Stand-Alone and Tandem Awards. Awards granted pursuant to the Plan may, in
the sole discretion of the Administrator, be granted either alone, in addition to, or in
tandem with, any other Award granted pursuant to the Plan. Awards granted in addition to or
in tandem with other Awards may be granted either at the same time as or at a different time
from the grant of such other Awards.

ARTICLE 6

VESTING OF AWARDS

An Award shall vest or become exercisable in whole or in part and at such times and upon such
conditions, if any, as determined by the Administrator and set forth in the Award Agreement. The
Administrator in its discretion may provide that an Award will be vested or exercisable upon (a)
the attainment of one or more performance goals or targets established by the Administrator, which
may be based on factors including, but not limited to, the price of a share of Common Stock, the
Company’s earnings per share, the Company’s market share, the Company’s sales, the
Company’s operating margin, the earnings before or after interest, taxes, depreciation, or
amortization of the Company; (b) the Participant’s Continuous Service for a specified period of
time; (c) the occurrence of any event or the satisfaction of any other condition specified by the
Administrator in its sole discretion; or (d) a combination of any of the foregoing. Each Award
may, in the discretion of the Administrator, have different provisions with respect to vesting or
exercise of the Award. At any time after grant of an Award, the Administrator may, in its sole
discretion, accelerate the period or waive the conditions for which an Award vests.

 

8

 

ARTICLE 7

STOCK OPTIONS

	7.1	 	Option Award Agreement.

	 	(a)	 	Option Exercise Price. The Option price (i.e., exercise price) per share of
Common Stock under each Option shall be determined by the Administrator and stated in
the Option Award Agreement. Options may be granted with an Option price of less than
100% of the Fair Market Value (determined as of the day the Option is granted) of the
 shares subject to the Option.

In the case of an Option that is subject to Section 409A (such as a discounted
Option), the timing of the exercise of the Option shall be limited to one (or the
earliest of two or more) of the following events, as specified in the applicable
Option Award Agreement, as determined and interpreted in accordance with Section
409A: (1) a Change in Control, (2) the Participant’s separation from service, (3) a
specified date, or (4) the taxable year in which the Option vests. In the event
that Participant fails to exercise such an Option within the prescribed period, the
Participant shall forfeit all rights under the Option; the Option Award Agreement
shall terminate and be of no further force or effect; and the Company shall be
released from all obligations under the Option.

The exercise price of an Option may not be repriced.

	 	(b)	 	Duration of Options. Each Option shall be of a duration as specified in the
applicable Award Agreement; provided, however, that the term of any Option shall be no
more than 10 years from the date on which the Option is granted and shall be subject to
early termination as provided herein.

	 	(c)	 	Rights as Stockholder. A Participant shall have no rights as a stockholder of
the Company with respect to any shares of Common Stock covered by an Option until the
date of the issuance of the stock certificate for such shares.

	 	(d)	 	Other Terms and Conditions. The Option Award Agreement may contain such other
provisions, which shall not be inconsistent with the Plan, as the Administrator shall
deem appropriate, including, without limitation, provisions that relate to the
Participant’s ability to exercise an Option in whole or in part to the passage of time
or the achievement of specific goals or the occurrence of certain events, as specified
by the Administrator.

 

9

 

	7.2	 	Manner of Exercise. An Option or portion of an Option may be exercised by
delivery of an irrevocable notice of exercise in such manner as determined by the Company,
stating the number of shares being purchased and the restrictions imposed on the shares so
purchased, if any.

	7.3	 	Payment of Option Price. The right to receive shares of the Common Stock
upon exercise of an Option shall be conditioned upon the delivery by the Participant of
payment for shares and withholding taxes incurred by reason of the exercise and certain
representations, if requested by the Administrator. The Administrator shall determine the
acceptable form of consideration for exercising an Option, including the method of payment,
either through the terms of the Option Award Agreement or at the time of exercise of an
Option. Acceptable forms of consideration may include:

	 	(a)	 	cash, check or wire transfer (denominated in U.S. Dollars);

	 	(b)	 	subject to the Company’s discretion to refuse for any reason and at any time to
accept such consideration and subject to any conditions or limitations established by
the Administrator, other shares of Common Stock held by the Participant which have a
Fair Market Value on the date of surrender equal to the aggregate exercise price of the
 shares as to which said Option shall be exercised;

	 	(c)	 	delivery of a notice that the Participant has placed a market sell order with a
broker with respect to shares of Common Stock then issuable upon exercise or vesting of
an Award, and that the broker has been directed to pay a sufficient portion of the net
proceeds of the sale to the Company in satisfaction of the aggregate payments required;
provided, that payment of such proceeds is then made to the Company upon settlement of
such sale;

	 	(d)	 	cashless “net exercise” arrangement pursuant to which the Company will reduce
the number of shares issued upon exercise by the largest whole number of shares having
an aggregate Fair Market Value that does not exceed the aggregate exercise price,
together with required withholding amounts (if any), provided that the Company shall
accept a cash or other payment from the Participant to the extent of any remaining
balance not satisfied by such reduction in the number of whole shares to be issued,

	 	(e)	 	such other consideration and method of payment for the issuance of shares of
Common Stock to the extent permitted by Applicable Laws and acceptable to the
Administrator, or

	 	(f)	 	any combination of the foregoing methods of payment.

 

10

 

ARTICLE 8

STOCK APPRECIATION RIGHTS

	8.1	 	Stock Appreciation Rights Award Agreement.

	 	(a)	 	Grant. A SAR shall entitle a Participant to exercise all or a specified portion
of the SAR and to receive from the Company an amount determined by multiplying the
difference obtained by subtracting the exercise price per share of the SAR from the
Fair Market Value on the date of exercise of the SAR by the number of shares of Common
Stock with respect to which the SAR shall have been exercised, subject to any
limitations the Administrator may impose.

	 	(b)	 	SAR Exercise Price. The exercise (or base) price per share of Common Stock
under each SAR shall be determined by the Administrator and shall not be less than 100%
of the Fair Market Value (determined as the day the SAR is granted) of the Common Stock
subject to the SAR, and shall be stated in the applicable Award Agreement. The
exercise price of the Common Stock under a SAR may not be repriced.

	 	(c)	 	Duration of SARs. Each SAR shall be of a duration as specified in the
applicable Award Agreement; provided, however, that the term of any SAR shall be no
more than 10 years from the date on which the SAR is granted and shall be subject to
early termination as provided herein.

	 	(d)	 	Rights as Stockholder. A Participant shall have no rights as a stockholder of
the Company with respect to any shares of Common Stock covered by a SAR.

	 	(e)	 	Other Terms and Conditions. The SAR Award Agreement may contain such other
provisions, which shall not be inconsistent with the Plan, as the Administrator shall
deem appropriate, including, without limitation, provisions that relate to the
Participant’s ability to exercise a SAR in whole or in part to the passage of time or
the achievement of specific goals or the occurrence of certain events, as specified by
the Administrator.

	 	(f)	 	Form of Payment. A SAR may be paid to the Participant in the form of cash,
whole shares, or a combination thereof, based on the Fair Market Value of the shares
earned under the SAR on the date of payment.

	8.2	 	Manner of Exercise. The SAR or portion of the SAR may be exercised by
delivery of an irrevocable notice of exercise in such manner as determined by the Company,
stating the number of shares as to which the SAR is being exercised.

 

11

 

ARTICLE 9

RESTRICTED STOCK

	9.1	 	Restricted Stock Award Agreement. Shares of Common Stock that are the
subject of a Restricted Stock Award will be subject to restrictions on disposition by the
Participant and an obligation of the Participant to forfeit and surrender the shares to the
Company under certain circumstances.

	 	(a)	 	Issuance of Restricted Stock. The right to receive Restricted Stock shall be
conditioned upon the delivery by the Participant of (i) payment of the purchase price,
if any, in full, by an electronic transfer of funds, such other form as may be
acceptable under the administrative procedures established by the Company, or any other
form of legal consideration that may be acceptable to the Administrator; (ii) payment
in similar form equal to such amount as the Company shall determine to be sufficient to
satisfy any liability it may have for any withholding of income or other taxes under
Applicable Laws incurred by reason of the vesting of the Restricted Stock or the
Participant’s election under Code Section 83(b); (iii) certain investment
representations, if requested by the Administrator; and (iv) a copy of the executed
Award Agreement in the form specified by the Administrator with respect to the grant of
Restricted Stock to that Participant.

	 	(b)	 	Stock Register or Certificates. Shares representing the Restricted Stock shall
be recorded in the stock register of the Company in the name of the Participant to whom
such Restricted Stock shall have been granted. In the event the Company issues
certificates, a stock certificate or certificates representing the Restricted Stock
shall be registered in the name of the Participant to whom such Restricted Stock shall
have been granted, and such certificates shall remain in the custody of the Company.
The Participant shall deposit with the Company stock powers or other instruments of
assignment, each endorsed in blank, so as to permit retransfer to the Company of all or
a portion of the Restricted Stock that shall be forfeited or otherwise not become
vested in accordance with the Plan and the applicable Award Agreement.

	 	(c)	 	Restrictions and Rights. Restricted Stock shall constitute issued and
outstanding shares of Common Stock for all corporate purposes. The Participant shall
have the right to vote such Restricted Stock, to receive and retain all regular cash
dividends and such other distributions, as the Board of Directors may, in its
discretion, designate, pay or distribute on such Restricted Stock, and to exercise all
other rights, powers and privileges of a holder of Common Stock with respect to such
Restricted Stock, except as set forth in this section. During the Restriction Period,
the Participant may not sell, transfer, pledge, exchange, hypothecate, or otherwise
dispose of the stock until the restrictions have lapsed, and a breach of the terms and
conditions established by the Administrator pursuant to the Award Agreement will cause
a forfeiture of the Restricted Stock. The Award Agreement may contain such other
provisions, which shall not be inconsistent with the Plan, as the Administrator shall
deem appropriate.

	 	(d)	 	Forfeiture. If the Participant fails to satisfy any applicable restrictions,
terms and conditions set forth in this Plan or in the applicable Award Agreement for
any reason, any Restricted Stock held by such Participant and affected by such
conditions shall be forfeited to the Company in return for such consideration as shall
be specified in the Award Agreement. The Company and its officers are
authorized to reflect such forfeiture of Restricted Stock on the Company’s stock
ledger.

 

12

 

	 	(e)	 	Section 83(b) Election. If a Participant makes an election under Code Section
83(b) to be taxed with respect to the Restricted Stock as of the date of transfer of
the Restricted Stock rather than as of the date or dates upon which the Participant
would otherwise be taxable under Code Section 83(a), the Participant shall be required
to deliver a copy of such election to the Company promptly after filing such election
with the Internal Revenue Service.

ARTICLE 10

OTHER AWARDS

	10.1	 	Bonus Stock Awards. Each Bonus Stock Award granted to a Participant will
constitute a transfer of shares of Common Stock other than Restricted Stock on such terms and
conditions as the Administrator shall determine. Bonus Stock Awards will be made in shares of
Common Stock and may be subject to performance criteria or any other specific criteria,
including service to the Company or an Affiliate, determined by the Administrator. The
purchase price, if any, for Common Stock issued in connection with a Bonus Stock Award will be
determined by the Administrator in its sole discretion.

	10.2	 	Restricted Stock Unit Award. Each Restricted Stock Unit Award will be
subject to such terms and conditions as the Administrator shall determine. The number and
terms and conditions of Restricted Stock Units shall be determined by the Administrator. The
Administrator shall specify the date or dates on which the Restricted Stock Units shall become
fully vested and nonforfeitable, and may specify such conditions to vesting as it deems
appropriate, including conditions based on one or more performance criteria or other specific
criteria, including service to the Company or an Affiliate, in each case on a specified date
or dates or over any period or periods, as the Administrator determines. The Administrator
shall specify, or permit the Participant to elect, the conditions and dates upon which the
 shares of Common Stock underlying the Restricted Stock Units which shall be issued, which
dates shall not be earlier than the date as of which the Restricted Stock Units vest and
become nonforfeitable and which conditions and dates shall be subject to compliance with
Section 409A. Restricted Stock Units may be paid in cash, shares of Common Stock, or both, as
determined by the Administrator. On the distribution dates, the Company shall issue to the
Participant one unrestricted, fully transferable share of Common Stock (or the Fair Market
Value of one such Share in cash) for each vested and nonforfeitable Restricted Stock Unit.

	10.3	 	Other Awards. The Administrator may from time to time in its sole
discretion determine which of the eligible Directors and Consultants of the Company and its
Affiliates should receive grants of other Awards that are valued in whole or in part by
reference to, or are otherwise based upon, Common Stock, including without limitation dividend
equivalents, phantom stock, phantom stock units and performance units. Such Awards may be
issued alone or in conjunction with other Awards under the Plan. In addition, the
Administrator may, from time to time, in its sole discretion and consistent with Applicable
Laws that would prohibit the imposition of the constructive or actual
receipt of income, afford a Participant the opportunity to convert the form of Award
currently held by the Participant prior to the time such Participant would become vested in
such Award (e.g., from a Restricted Stock Award to a restricted stock unit award). The
Administrator, in its sole discretion, may include in any Award any provisions necessary to
avoid adverse tax consequences to the Participant under Section 409A.

 

13

 

ARTICLE 11

ISSUANCE OF SHARES

	11.1	 	Stock Certificates. Notwithstanding anything herein to the contrary, the
Company shall not be required to issue or deliver any certificates evidencing shares of Common
Stock pursuant to the exercise of any Award, unless and until the Board of Directors has
determined, with advice of counsel, that the issuance and delivery of such certificates is in
compliance with all Applicable Laws, regulations of governmental authorities and, if
applicable, the requirements of any exchange on which the shares are listed or traded. The
Company shall not be required to issue or deliver any certificates evidencing shares of Common
Stock prior to satisfaction of any applicable vesting requirement. All stock certificates
delivered pursuant to the Plan are subject to any stop-transfer orders and other restrictions
as the Administrator deems necessary or advisable to comply with federal, state, or foreign
jurisdiction, securities or other under Applicable Laws and rules and regulations and to
reflect vesting restrictions. The Administrator may place legends on any stock certificate to
reference restrictions applicable to the shares. In addition to the terms and conditions
provided herein, the Board of Directors may require that a Participant make such reasonable
covenants, agreements, and representations as the Board of Directors, in its discretion, deems
advisable in order to comply with any such laws, regulations, or requirements. The
Administrator shall have the right to require any Participant to comply with any timing or
other restrictions with respect to the settlement or exercise of any Award, including a
window-period limitation, as may be imposed in the discretion of the Administrator. No
fractional shares of Common Stock shall be issued and the Administrator shall determine, in
its sole discretion, whether cash shall be given in lieu of fractional shares or whether such
fractional shares shall be eliminated by rounding down.

	 
	11.2	 	Nontransferability.

	 	(a)	 	No right or interest of a Participant in any Award may be pledged, encumbered,
or hypothecated to or in favor of any party other than the Company or an Affiliate, or
shall be subject to any lien, obligation, or liability of such Participant to any other
party other than the Company or an Affiliate. Except as otherwise provided by the
Administrator, no Award shall be assigned, transferred, or otherwise disposed of by a
Participant for value other than by will or the laws of descent and distribution or,
subject to the consent of the Administrator, pursuant to a domestic relations order,
unless and until such Award has been exercised, or the shares underlying such Award
have been issued, and all restrictions applicable to such shares have lapsed.

 

14

 

	 	(b)	 	During the lifetime of the Participant and for so long as the Participant is
not incapacitated, only the Participant may exercise an Award (or any portion thereof)
granted to him under the Plan, unless it has been disposed of pursuant to a domestic
relations order. Notice to exercise an Award shall be signed by the Participant or
other person then entitled to exercise the Award or such portion of the Award. In the
event that an Award shall be exercised by any person or persons other than the
Participant, the Administrator may require appropriate proof of the right of such
person or persons to exercise the Award. In addition, the Administrator may require
such representations and documents as the Administrator, in its sole discretion, deems
necessary or advisable to effect compliance with all applicable provisions of the
Securities Act and any other federal, state or foreign securities laws or regulations,
the rules of any securities exchange on which the Common Stock is traded or any other
Applicable Laws. The Administrator may, in its sole discretion, also take whatever
additional actions it deems appropriate to effect such compliance including, without
limitation, placing legends on share certificates and issuing stop-transfer notices to
agents and registrars. After the death or incapacitation of the Participant, any
exercisable portion of an Award may, prior to the time when such portion becomes
unexercisable under the Plan or the applicable Award Agreement, be exercised by his
personal representative or by any person empowered to do so under the deceased
Participant’s will or under the then Applicable Laws of descent and distribution.

	 	(c)	 	Notwithstanding the foregoing, the Administrator, in its sole discretion, may
determine to permit a Participant to transfer an Award to any one or more Permitted
Transferees, subject to the following terms and conditions: (i) an Award transferred
to a Permitted Transferee shall not be assignable or transferable by the Permitted
Transferee other than by will or the laws of descent and distribution; (ii) an Award
transferred to a Permitted Transferee shall continue to be subject to all the terms and
conditions of the Award as applicable to the original Participant (other than the
ability to further transfer the Award); and (iii) the Participant and the Permitted
Transferee shall execute any and all documents requested by the Administrator.

	11.3	 	Paperless Administration. Subject to Applicable Laws, the Administrator may
make Awards, provide applicable disclosure and establish procedures for exercise of Awards by
an internet website or interactive voice response system for the paperless administration of
Awards.

ARTICLE 12

TERMINATION OF CONTINUOUS SERVICE

	12.1	 	Effect of Termination of Continuous Service. Except as otherwise provided
in an applicable Award Agreement or employment agreement with a Participant, or as otherwise
provided by the Administrator, any vesting of any Award shall cease upon termination of the
Participant’s Continuous Service, and any Award shall be exercisable only to the extent that
it was exercisable on the date of such termination of Continuous
Service. Any Award not exercisable as of the date of termination, and any Award or portions
thereof not exercised within the period specified herein, shall terminate.

	 	(a)	 	Termination Other than for Cause. Subject to any limitations set forth in the
agreement for an Award, and provided that the notice of exercise is provided as
required by the Plan prior to the expiration of the Award, the Participant shall be
entitled to exercise the Award (i) during the Participant’s Continuous Service, and
(ii) for a period of 90 days after the date of termination of the Participant’s
Continuous Service for reason other than Cause, or such longer period as may be set
forth in the Award Agreement.

 

15

 

	 	(b)	 	Termination by Death. Notwithstanding subsection (a), if a Participant’s
Continuous Service should terminate as a result of the Participant’s death, or if a
Participant should die within a period of 90 days after termination of the
Participant’s Continuous Service under circumstances in which subsection (a) would
permit the exercise of the Award following termination, the personal representatives of
the Participant’s estate or the person or persons who shall have acquired the Award
from the Participant by bequest or inheritance may exercise the Award at any time
within one year after the date of death, but not later than the expiration date of the
Award.

	 	(c)	 	Termination by Disability. Notwithstanding subsection (a), if a Participant’s
Continuous Service should terminate by reason of the Participant’s Disability, the
Participant may exercise the Award at any time within one year after the date of
termination but not later than the expiration date of the Award.

	 	(d)	 	Termination for Cause. Notwithstanding anything herein to the contrary, and
unless otherwise provided by the Award Agreement, if the Participant is terminated for
Cause, all unexercised Awards granted to the Participant shall terminate immediately
upon such termination.

	 	(e)	 	Extension of Award Termination Date. The Administrator, in its sole
discretion, may extend the termination date of an Award granted under the Plan without
regard to the preceding provisions of this section.

	12.2	 	Effect of Termination of Continuous Service on Stock. Except as otherwise
provided in an applicable Award Agreement or employment agreement with a Participant, or as
otherwise provided by the Administrator, in the event that a Participant terminates Continuous
Service with the Company for any reason, including Disability of the Participant, any unvested
 shares of Common Stock held by such Participant as of the date of such termination of
Continuous Service shall be forfeited to the Company as of the date of termination of
Continuous Service.

 

16

 

ARTICLE 13

REORGANIZATION, RECAPITALIZATION AND CHANGE IN CONTROL

	13.1	 	Adjustments to Common Stock. The shares with respect to which Awards may be
granted are shares of Common Stock as presently constituted; provided, however, that if,
and whenever, prior to the expiration or distribution to the Participant of an Award
theretofore granted, the Company shall effect a subdivision or consolidation of shares of
Common Stock or the payment of a stock dividend on Common Stock without receipt of
consideration by the Company, the number of shares of Common Stock with respect to which
such Award may thereafter be exercised or satisfied, as applicable, (a) in the event of an
increase in the number of outstanding shares, shall be proportionately increased, and the
exercise price per share shall be proportionately reduced, and (b) in the event of a
reduction in the number of outstanding shares, shall be proportionately reduced, and the
exercise price per share shall be proportionately increased.

	13.2	 	Recapitalization. If the Company recapitalizes or otherwise changes its
capital structure, thereafter upon any exercise or satisfaction, as applicable, of a
previously granted Award, the Participant shall be entitled to receive (or entitled to
purchase, if applicable) under such Award, in lieu of the number of shares of Common Stock
then covered by such Award, the number and class of shares of stock and securities to which
the Participant would have been entitled pursuant to the terms of the recapitalization if,
immediately prior to such recapitalization, the Participant had been the holder of record of
the number of shares of Common Stock then covered by such Award.

	13.3	 	Change in Control. In the event of a Change in Control, the Administrator
in its sole discretion may:

	 	(a)	 	Substitution of Awards. negotiate a binding agreement whereby the surviving
corporation or acquiring corporation may assume any outstanding Award under the Plan or
may substitute similar stock awards on an equitable basis of appropriate stock of the
Company, or of the surviving corporation or acquiring corporation, which will be
issuable in respect of the Common Stock (including an award to acquire the same
consideration paid to the stockholders in the Change in Control) for those outstanding
under the Plan; provided that with respect to each outstanding Award subject to Section
409A, any such substituted award meets the requirements of Section 409A;

	 	(b)	 	Acceleration of Vesting. accelerate the vesting of outstanding Awards (and, if
applicable, the time during which such Awards may be exercised);

	 	(c)	 	Acceleration of Exercise: in lieu of, or in addition to, accelerating the
vesting of outstanding Awards, the Administrator may, upon written notice to
Participants, provide that all unexercised Awards must be exercised or satisfied upon
the Change in Control or within a specified number of days of the date of such Change
in Control or such Awards will terminate. In response to such notice, a Participant
may make an irrevocable election to exercise the Participant’s Award contingent upon
and effective as of the effective date stated in such notice. Any Award shall
terminate if not exercised upon the time frame stated in the notice. The Administrator
may, in its sole discretion, accelerate the vesting of any outstanding Award in
connection with any proposed or completed Change in Control.

 

17

 

	 	(d)	 	Cash-Out: prior to such a Change in Control, terminate any or all unexercised
Awards (after acceleration of vesting) in exchange for cash or consideration similar to
that received by stockholders of Common Stock of the Company in the Change in Control,
less the exercise price required under any such Awards.

	13.4	 	Other Events. In the event of changes to the outstanding Common Stock by
reason of recapitalization, reorganization, mergers, consolidations, combinations, exchanges
or other relevant changes in capitalization occurring after the date of the grant of any Award
and not otherwise provided for under this article, any outstanding Awards and any Award
Agreements evidencing such Awards shall be subject to adjustment by the Administrator in its
discretion as to the number and exercise price of shares of Common Stock or other
consideration subject to such Award. In the event of any such change to the outstanding
Common Stock, the aggregate number of shares available under the Plan may be appropriately
adjusted by the Administrator, the determination of which shall be conclusive.

	13.5	 	No Adjustment for Certain Awards. Except as hereinabove expressly provided,
the issuance by the Company of shares of stock of any class or securities convertible into
 shares of stock of any class, for cash, property, labor or services, upon direct sale, upon
the exercise of rights or warrants to subscribe therefor or upon conversion of shares or
obligations of the Company convertible into such shares or other securities, and in any case
whether or not for fair market value, shall not affect previously granted Awards, and no
adjustment by reason thereof shall be made with respect to the number of shares of Common
Stock subject to Awards theretofore granted or the exercise price per share, if applicable.

ARTICLE 14

AMENDMENT AND TERMINATION

	14.1	 	Amendment of the Plan. The Board of Directors may at any time and from time
to time alter, amend, suspend or terminate the Plan or any part thereof as it may deem proper,
except that no such action shall diminish or impair the rights under an Award previously
granted without the consent of the affected Participant. Unless the stockholders of the
Company shall have given their approval, the Board of Directors may not amend the Plan to (a)
increase the maximum aggregate number of shares that may be issued under the Plan, (b) change
the class of individuals eligible to receive Awards under the Plan, or (c) make any other
change that would require stockholder approval under Applicable Laws.

	14.2	 	Termination of the Plan. The Board of Directors may at any time suspend or
terminate the Plan. No such suspension or termination shall diminish or impair the rights
under an Award previously granted without the consent of the affected Participant, and
termination of the Plan shall not affect the Administrator’s ability to exercise the powers
granted to it hereunder with respect to Awards granted under the Plan prior to the date of
such termination. No Awards may be granted or awarded during any period of suspension or after
termination of the Plan, and in no event may any Award be granted under the Plan after the
tenth anniversary of the Effective Date.

 

18

 

ARTICLE 15

GENERAL PROVISIONS

	15.1	 	Tax Obligations. To the extent provided by the terms of an Award Agreement,
the Participant may satisfy any federal, state local and foreign income or other tax
withholding obligation (including the Participant’s FICA or employment tax obligation) under
Applicable Laws relating to the exercise or acquisition of Common Stock under an Award by
tendering a cash payment or, if permitted by the Administrator, either withholding from any
cash compensation paid to the Participant by the Company or its Affiliate or delivering to the
Company owned and unencumbered shares of Common Stock. The number of shares of Common Stock
which may be withheld or surrendered shall be limited to the number of shares which have a
Fair Market Value on the date of withholding or repurchase equal to the aggregate amount of
such liabilities based on the minimum statutory withholding rates for federal, state, local
and foreign income tax and payroll tax purposes that are applicable to such supplemental
taxable income. Notwithstanding any provision to the contrary, all taxes associated with
participation in the Plan, including any liability imposed under Section 409A, shall be borne
by the Participant.

	15.2	 	Section 409A. To the extent that the Administrator determines that any Award granted
under the Plan is subject to Section 409A, the Award Agreement evidencing such Award shall
incorporate the terms and conditions required by Section 409A. To the extent applicable, the
Plan and Award Agreements shall be interpreted in accordance with Section 409A.
Notwithstanding any provision of the Plan to the contrary, in the event that following the
Effective Date the Administrator determines that any Award may be subject to Section 409A, the
Administrator may adopt such amendments to the Plan and the applicable Award Agreement or
adopt other policies and procedures (including amendments, policies and procedures with
retroactive effect), or take any other actions, that the Administrator determines are
necessary or appropriate to (a) exempt the Award from Section 409A and/or preserve the
intended tax treatment of the benefits provided with respect to the Award, or (b) comply with
the requirements of Section 409A and thereby avoid the application of any penalty taxes under
Section 409A.

	15.3	 	Rule 16b-3. It is intended that, at any time the Company is Publicly
Traded, the Plan and any Award made to a person subject to Section 16 of the Exchange Act
shall meet all of the requirements of Rule 16b-3. If any provision of the Plan or of any such
Award would disqualify the Plan or such Award under, or would otherwise not comply with the
requirements of, Rule 16b-3, such provision or Award shall be construed or deemed to have been
amended as necessary to conform to the requirements of Rule 16b-3.

 

19

 

	15.4	 	Section 162(m).

	 	(a)	 	Performance-Based Compensation. It is intended that, at any time when the
Common Stock is Publicly-Traded, the Plan shall comply fully with and meet all the
requirements of Section 162(m) so that Awards hereunder which are made to Participants
who are “covered employees” (as defined in Section 162(m)) shall constitute
“performance-based” compensation within the meaning of Section 162(m). If an Award is
intended to qualify as “performance-based” compensation within the meaning of Section
162(m), it shall be payable solely on account of attainment of established performance
goals. If any provision of the Plan or an applicable Award Agreement would disqualify
the Plan or Award or would not otherwise permit the Plan or Award to comply with
Section 162(m) as so intended, such provision shall be construed or deemed amended to
conform to the requirements or provisions of Section 162(m).

	 	(b)	 	Performance-Based Requirements. To the extent necessary to comply with the
requirements of Section 162(m)(4)(C), with respect to any Award which is intended to
qualify as performance-based compensation, no later than 90 days following the
commencement of any performance period or any designated fiscal period or period of
service (or such earlier time as may be required under Section 162(m)), the
Administrator shall, in writing, (i) designate one or more eligible individuals, (ii)
select the performance criteria applicable to such performance period, (iii) establish
the performance goals and amounts of such Awards that may be earned for such
performance period, and (iv) specify the relationship between performance criteria and
the performance goals and the amounts of such Awards, as applicable, to be earned by
each covered employee for such performance period.

	 	(c)	 	Performance Criteria. The performance criteria to be utilized under the Plan
for such purposes shall consist of objective tests based on one or more of the
following: achievement of benchmarks such as specified permitting or financings;
earnings or earnings per share; cash flow; customer satisfaction; revenues; financial
return ratios (such as return on equity and/or return on assets); market performance;
stockholder return or value; operating profits; EBITDA; net profits; profit returns and
margins; stock price; credit quality; sales growth; market share; comparisons to peer
companies (on a company-wide or divisional basis); working capital; or individual or
aggregate employee performance.

	 	(d)	 	Certification of Results. Following the completion of each performance period,
the Administrator shall certify in writing whether and the extent to which the
applicable performance goals have been achieved for such performance period. In
determining the amount earned under such Awards, the Administrator shall have the right
to reduce or eliminate (but not to increase) the amount payable at a given level of
performance to take into account additional factors that the Administrator may deem
relevant including the assessment of individual or corporate performance for the
performance period.

 

20

 

	15.5	 	Section 13(k). Notwithstanding any other provision of the Plan to the contrary, no
Participant who is an “executive officer” of the Company within the meaning of Section 13(k)
of the Exchange Act shall be permitted to make payment with respect to any Awards granted
under the Plan, or continue any extension of credit with respect to such payment with a loan
from the Company or a loan arranged by the Company in violation of Section 13(k) of the
Exchange Act.

	15.6	 	Beneficiary Designations. Each Participant may, from time to time, name a
beneficiary or beneficiaries (who may be contingent or successive beneficiaries) for purposes
of receiving any amount which is payable in connection with an Award under the Plan upon or
subsequent to the Participant’s death. Each such beneficiary designation shall serve to
revoke all prior beneficiary designations, be in a form prescribed by the Company and be
effective solely when filed by the Participant in writing with the Company during the
Participant’s lifetime. In the absence of any such written beneficiary designation, for
purposes of the Plan, a Participant’s beneficiary shall be the Participant’s estate.

	15.7	 	No Right to Continuous Service. Nothing contained in this Plan or in any
Award granted under the Plan shall confer upon any Participant any right with respect to the
continuation of such Participant’s Continuous Service by the Company or any Affiliate or
interfere in any way with the right of the Company or any Affiliate, subject to the terms of
any separate employment agreement to the contrary, at any time to terminate such Continuous
Service or to increase or decrease the compensation of the Participant from the rate in
existence at the time of the grant of the Award.

	15.8	 	Jurisdictions. In order to assure the viability of Awards granted to
Participants employed in various jurisdictions, the Administrator shall have the authority to
adopt such modifications, procedures and subplans as may be necessary or desirable to comply
with provisions of the Applicable Laws in which the Company may operate to assure the
viability of the benefits from Awards granted to Participants employed in such countries, to
accommodate differences in local law, tax policy, or custom applicable in the jurisdiction in
which the Participant resides or is employed and to meet the objectives of the Plan.
Moreover, the Administrator may approve such supplements to, or amendments, restatements, or
alternative versions of, the Plan as it may consider necessary or appropriate for such
purposes without thereby affecting the terms of the Plan as in effect for any other purpose;
provided, however, that no such supplements, amendments, restatements, or alternative versions
shall increase the share limitations contained in Article 4. Notwithstanding the foregoing,
the Administrator may not take any actions hereunder, and no Awards shall be granted, that
would violate any Applicable Laws.

	15.9	 	Foreign Currency. A Participant may be required to provide evidence that
any currency used to pay the exercise price of any Award was acquired and taken out of the
jurisdiction in which the Participant resides in accordance with Applicable Laws, including
foreign exchange control laws and regulations. The amount payable will be determined by
conversion from U.S. dollars at the exchange rate as selected by the Administrator on the date
of exercise.

 

21

 

	15.10	 	Other Benefits. Unless so provided by the applicable plan, the amount of
compensation deemed to be received by a Participant as a result of the exercise of an Award
shall not constitute earnings with respect to which any other benefits of the person are
determined, including without limitation benefits under any pension, profit sharing, life
insurance, or disability or other salary continuation plan.

	15.11	 	Confidentiality of Information. Except as required by Applicable Laws,
information regarding the grant of Awards under this Plan is confidential information of the
Company and may not be shared with anyone other than the Participant’s immediate family and
personal financial advisor and other person(s) designated by Participant by power of attorney
or assignment.

	15.12	 	No Funding. The Plan shall be unfunded. The Company shall not be required
to establish any special or separate fund or to make any other segregation of funds or assets
to ensure the payment of any Award.

	15.13	 	Severability. If any provision of this Plan is held by any court or
governmental authority to be illegal or invalid for any reason, such illegality or invalidity
shall not affect the remaining provisions. Instead, each provision held to be illegal or
invalid shall, if possible, be construed and enforced in a manner that will give effect to the
terms of such provision to the fullest extent possible while remaining legal and valid.

	15.14	 	Governing Law and Venue. This Plan, and all Awards granted under this
Plan, shall be construed and shall take effect in accordance with the laws of the State of
Nevada without regard to conflicts of laws principles.

	15.15	 	Use of Proceeds. Any cash proceeds received by the Company from the sale
of shares of Common Stock under the Plan shall be used for general corporate purposes, but in
no event shall be used to purchase shares in the public market for issuance of Stock or Awards
under the Plan.

	15.16	 	Appendices. The Administrator may approve such supplements, amendments or
appendices to the Plan as it may consider necessary or appropriate for purposes of compliance
with Applicable Laws or otherwise and such supplements, amendments or appendices shall be
considered a part of the Plan; provided, however, that no such supplements shall increase the
share limitations contained in Article 4.

	15.17	 	Indemnification. To the extent allowable pursuant to Applicable Laws, each
member of the Administrator and of the Board of Directors shall be indemnified and held
harmless by the Company from any loss, cost, liability, or expense that may be imposed upon or
reasonably incurred by such member in connection with or resulting from any claim, action,
suit, or proceeding to which the member may be a party or in which the member may be involved
by reason of any action or failure to act pursuant to the Plan and against and from any and
all amounts paid by him or her in satisfaction of judgment in such action, suit, or proceeding
against him or her; provided he or she gives the Company an opportunity, at its own expense,
to handle and defend the same before he or she undertakes to handle and defend it on his or
her own behalf. The foregoing right of
indemnification shall not be exclusive of any other rights of indemnification to which such
persons may be entitled pursuant to the Company’s Certificate of Incorporation or Bylaws, as
a matter of law, or otherwise, or any power that the Company may have to indemnify them or
hold them harmless.

 

22Exhibit 10.1

Exhibit 10.1

Employment Agreement

Employment Agreement (this “Agreement”) dated as of September 6, 2011 (the “Effective Date”)
by and between Prospect Global Resources Inc. a Nevada corporation (the “Company”), and Wayne E.
Rich (the “Executive”).

WHEREAS, the Company recognizes that the Executive’s talents and abilities are unique, and are
integral to the success of the Company, and thus wishes to secure the ongoing services of the
Executive on the terms and conditions set forth herein;

NOW, THEREFORE, in consideration of the promises and the mutual covenants set forth below,
Company and the Executive agree as follows:

	 	1.	 	Employment: The Company hereby agrees to employ the Executive as the Chief
Financial Officer and Vice President of Finance (“CFO”) of the Company, and the Executive
hereby accepts such employment, on the terms and conditions set forth below.

	 
	 	2.	 	Compensation and Related Matters:

	 	a.	 	Base Salary. During the Executive’s term of service (the
“Employment Period”), the Company shall pay the Executive a base salary at the
rate of not less than $275,000 per year (“Base Salary”). The Executive’s base
Salary shall be paid in accordance with the Company’s normal payroll practice or,
if no such practice is established, in equal installments at the end of each month
(with a partial month for the month of September, 2011). If the Executive’s Base
Salary is increased by the Company, such increased Base Salary shall then
constitute the Base Salary for all purposes of this agreement.

	 	b.	 	Stock Options: Subject to approval by the Company’s Board of
Directors, within 60 days of the Effective Date the Executive will be granted
options to purchase 1,000,000 shares (the “Base Options”) of the Company’s common
stock (“Common Stock”) at fair market value (as determined pursuant to the
Company’s 2011 Employee Equity Incentive Plan). The Options shall vest, subject
to acceleration as provided below, as follows: 250,000 Base Options on the grant
date, 250,000 Base Options on the 180th day after the Effective Date
and 500,000 Base Options on the one year anniversary of the Effective Date, in
each case so long as the Executive either (i) is employed as the Company’s CFO on
such date or (ii) has died or become permanently disabled prior to such date and
was employed as the Company’s CFO at the time of death or disability. If the
exercise price of the Base Options is greater than $4.50 per share, subject to
approval by the Company’s Board of Directors, at the
time the Base Options are granted the Executive will be granted additional options
to purchase 200,000 shares (the “Additional Options” and, together with the Base
Options, the “Options”) of Common Stock at the same exercise price as the Base
Options. The Additional Options shall vest, subject to acceleration as provided
below, on the one year anniversary of the Effective Date, in each case so long as
the Executive either (i) is employed as the Company’s CFO on such date or (ii) has
died or become permanently disabled prior to such date and was employed as the
Company’s CFO at the time of death or disability.

 

 

 

Notwithstanding any provision to the contrary, the Options shall immediately
vest in full upon either a “Change in Control” or the termination of the
Executive’s services as CFO by the Company other than for “Cause” (as defined
below).

For purposes of this Agreement, “Change in Control” shall mean the occurrence,
subsequent to the Effective Date, of any of the following: (A) by a transaction or
series of transactions, any “person” or “group” (within the meaning of Section
13(d) and 14(d)(2) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”)) becomes the “beneficial owner” (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of more than 35% of the combined voting
power of the Company’s then outstanding securities (provided such person or group
was not a beneficial owner of more than 35% of the combined voting power of the
Company’s then outstanding securities as of the Effective Date); (B) as a result of
any merger, consolidation, combination or sale or issuance of securities of the
Company, or as a result of or in connection with a contested election of directors,
the persons who were directors of the Company as of the Effective Date cease to
constitute a majority of the Board of Directors of the Company (the “Board”); (C)
by a transaction or series of transactions, the authority of the Board over any
activities of the Company becomes subject to the consent, agreement or cooperation
of a third party other than shareholders of the Company.

For purposes of this Agreement, “Cause” shall mean (A) the Executive’s
conviction by a court of competent jurisdiction as to which no further appeal can
be taken of a felony (other than a violation based on operation of a vehicle) or
entering the plea of nolo contendere to such crime by the Executive; (B) the
Executive’s commission of a crime involving fraud or intentional dishonesty, which
results in the Executive’s substantial personal enrichment and material adverse
effect to the Company; or (C) the Executive becoming subject to any securities
related sanctions related to the Company other than those based on an act
of the Company itself for which the Executive is charged solely as a result of
his position with the Company.

 

2

 

	 	c.	 	Annual Bonus: For each full fiscal year of the Company that
begins and ends during the Employment Period, and for the portion of the fiscal
year of the Company that begins in 2011 (“Fiscal Year 2011”), the Executive shall
be eligible to earn an annual cash bonus in such amount as shall be determined by
the Compensation Committee of the Board (the “Compensation Committee”) (the
“Annual Bonus”) based on the achievement by the Company of performance goals
established by the Compensation Committee (or the Board if there is no
Compensation Committee) for each such fiscal year (or portion of Fiscal Year
2011), which may include targets related to the earnings before interest, taxes,
depreciation and amortization (“EBITDA”), financial reporting, financial controls,
acquisitions, leases, permitting, etc. of the Company; provided, that the Annual
Bonus shall be no less than 80% and no greater than 120% of the then-current Base
Salary and the Annual Bonus for 2011 shall be not less than $100,000. The
Compensation Committee (or the Board if there is no Compensation Committee) shall
establish objective criteria to be used to determine the extent to which
performance goals have been satisfied. This criteria shall be established within
60 days of the Effective Date. The amount of each annual bonus shall be not less
than 80% nor greater than 120% of the then-current Base Salary).

	 	d.	 	Vacation: The Executive shall be entitled to four weeks of
vacation per fiscal year. Up to three weeks of vacation not taken during the
applicable fiscal year shall be carried over to the next following fiscal year.
Vacation shall accrue to the Executive at rate of not less than one week per
quarter in advance.

	 	e.	 	Expenses: The Company will reimburse the Executive for all
expenses related to Company business, including, but not limited to travel,
marketing, communication, due diligence, legal fees and expenses, etc.

	 	f.	 	Welfare, Pension and Incentive Benefit Plans: During the
Employment Period, the Executive (and his eligible spouse and dependents) shall be
entitled to participate in all the welfare benefit plans and programs maintained
by the Company from time to time for the benefit of its senior executives
including, without limitation, all medical, hospitalization, dental, disability,
accidental death and dismemberment and travel accident insurance plans and
programs. In addition, during the Employment Period, the Executive shall be
eligible to participate in all pension, retirement, savings and other employee
benefit plans and
programs maintained from time to time by the Company for the benefit of its senior
executives.

 

3

 

	 	g.	 	Professional Development. The Company will reimburse the
Executive for education and professional development expenses related to courses
or programs selected by the Executive in the natural resources sector up to
$10,000 per calendar year. The Executive may take such courses during normal
business hours and will not be required to utilize vacation time.

	 	3.	 	Responsibilities: As the CFO, the Executive will have the responsibilities of
a chief financial officer and shall also assist the Company’s President and Chief
Executive Officer in developing the Company’s strategic direction, identifying and
pursuing acquisition targets, personnel hiring, budget preparation, development of an
annual operating plan and periodic long range plans, overseeing all portfolio companies’
operations, finances, budgets and strategic direction, and compliance with all regulatory
requirements developing and implementing the Company’s business plan. The CFO shall
report directly to the Company’s President and Chief Executive Officer. With the approval
of the President and Chief Executive Officer, finance and accounting staff may be hired by
the Executive.

	 	4.	 	At-Will Employment; Severance: The Executive’s employment with the Company is
on an at-will basis. If terminated by the Company for any reason other than Cause,
including a change of control, the Company shall provide severance to the Executive,
payable in accordance with the Company’s normal payroll practice, of 12 month’s Base
Salary, an Annual Bonus of 120% of the then-current Base Salary, accrued vacation, and any
reimbursement of all business and professional development expenses incurred but not yet
reimbursed. In addition the Company shall reimburse the Executive for COBRA payments made
by the Executive for 12 months following termination by the Company for any reason other
than Cause.

	 	5.	 	Location: The Executive will be based in the Denver, Colorado, metropolitan
area. During the Employment Period, the Company shall provide the Executive with an
office and appropriate equipment and support staff.

	 	6.	 	Representations and Warranties: The Company represents and warrants to the
Executive that this Agreement has been duly authorized, executed and delivered by the
Company and, assuming the due execution by the Executive, constitutes a legal, valid and
binding agreement of the Company, enforceable against the Company in accordance with its
terms.

 

4

 

	 	7.	 	Indemnity: The Company agrees that if the Executive is made a party or is
threatened to be made a party to any action, suit or proceeding, whether civil, criminal,
administrative or investigative (a “Proceeding”) by reason of the fact that the Executive
is or was a trustee, director, member, agent or officer of the Company or any predecessor
to the Company or any of their affiliates or is or was serving at the request of the
Company, any predecessor to the Company or any of their affiliates as a trustee, director,
officer, member, employee or agent of another corporation or a partnership, joint venture,
limited liability company, trust or other enterprise, including, without limitation,
service with respect to employee benefit plans, whether or not the basis of such
Proceeding is alleged action in an official capacity as a trustee, director, officer,
member, employee or agent while serving as a trustee, director, officer, member, employee
or agent, the Executive shall be indemnified and held harmless by the Company to the
fullest extent authorized by Delaware law, as the same exists or may hereafter be amended,
against all Expenses incurred or suffered by the Executive in connection therewith, and
such indemnification shall continue as to the Executive even if the Executive has ceased
to be an officer, director, trustee or agent, or is no longer employed by the Company and
shall inure to the benefit of his heirs, executors and administrators.

	 	a.	 	Expenses. As used in this Section 7, the term “Expenses”
shall include, without limitation, damages, losses, judgments, liabilities, fines,
penalties, excise taxes, settlements, and costs, attorneys’ fees, accountants’
fees, and disbursements and costs of attachment or similar bonds, investigations,
and any expenses of establishing a right to indemnification under this Agreement.

	 	b.	 	Enforcement. If a claim or request under this Section 7 is
not paid by the Company or on its behalf, within 30 days after a written claim or
request has been received by the Company, the Executive may at any time thereafter
bring suit against the Company to recover the unpaid amount of the claim or
request and if successful in whole or in part, the Executive shall be entitled to
be paid also the expenses of prosecuting such suit. All obligations for
indemnification hereunder shall be subject to, and paid in accordance with,
applicable Colorado law.

	 	c.	 	Advances of Expenses. Expenses incurred by the Executive in
connection with any Proceeding shall be paid by the Company in advance upon
request of the Executive that the Company pay such Expenses, but only in the event
that the Executive shall have delivered in writing to the Company (i) an
undertaking to reimburse the Company for Expenses with respect to which the
Executive is not entitled to indemnification and (ii) a statement of his good
faith belief that the
standard of conduct necessary for indemnification by the Company has been met.

 

5

 

	 	d.	 	Insurance. The Company will maintain a Director’s and
Officer’s Insurance Policy naming the Executive as a covered party in an amount
deemed mutually sufficient to the Company and the Executive. The Company will use
its best commercial efforts to have this policy in place within 90 days of the
Effective Date.

	 	8.	 	Survival of Certain Provisions: The representations, warranties and covenants
and indemnity provisions contained in Sections 2, 4, 6 and 7 of this Agreement and the
Company’s obligation to pay the Executive any compensation earned pursuant hereto shall
remain operative and in full force and effect regardless of any completion or termination
of this Agreement and shall be binding upon, and shall inure to the benefit of, any
successors, assigns, heirs and personal representatives of the Company, the indemnified
parties and any such person.

	 	9.	 	Notices: Any notice given with respect to this Agreement shall be in writing
and shall be mailed or delivered (a) if to the Company, at its offices at 600
17th Street, Suite 2800-South, Denver, CO 80202, and (b) if to the Executive,
at 11074 Grayledge Circle, Highlands Ranch, CO 80130, in either case with a copy to the
Company’s legal counsel, Jeff Knetsch, Brownstein Hyatt Farber Schreck, LLP, 410
17th Street, 22nd Floor, Denver, CO 80202.

	 	10.	 	Counterparts: This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which shall constitute
one and the same instrument.

	 	11.	 	Third Party Beneficiaries: This Agreement has been and is made solely for the
benefit of the parties hereto, and their respective successors and assigns, and no other
person shall acquire or have any right under or by virtue of this Agreement.

	 	12.	 	Validity: The invalidity or unenforceability of any provision or provisions
of this Agreement shall not affect the validity or enforceability of any other provision
of this Agreement, which shall remain in full force and effect.

	 	13.	 	Dispute Resolution: If a dispute arises out of or relating to this Agreement
or the breach of this Agreement, and if the dispute cannot be settled through direct
discussions, the parties agree to first endeavor to settle the dispute in an amicable
manner by mediation. Mediation shall consist of an informal, nonbinding conference or
conferences between the parties and the mediator jointly, and at the discretion of the
mediator, then in separate caucuses in which the mediator will seek to guide the parties
to a resolution of the case. Each party
shall pick a mediator selector and the two mediator selectors shall then pick and appoint a
mediator. The Company will pay all mediation related costs, including, without limitation,
the Executive’s costs and reasonable fees, including attorneys’ fees, incurred in selecting
a mediator and obtaining counsel for purposes of the mediation.

 

6

 

	 	14.	 	Choice of Law, Jurisdiction and Venue: This Agreement shall be governed by,
construed, and enforced in accordance with the laws of the State of Colorado. Any and all
actions, suits, or judicial proceedings upon any claim arising from or relating to this
Agreement, shall be instituted and maintained in the State or Federal courts sitting in
the State of Colorado. Each party waives the right to change of venue.

	 	15.	 	Miscellaneous: No provisions of this Agreement may be amended, modified, or
waived unless such amendment or modification is agreed to in writing signed by the
Executive and by a duly authorized officer or a director of the Company, and such waiver
is set forth in writing and signed by the party to be charged. No waiver by either party
hereto at any time of any breach by the other party hereto of any condition or provision
of this Agreement to be performed by such other party shall be deemed a waiver of similar
or dissimilar provisions or conditions at the same or at any prior or subsequent time. No
agreements or representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not set forth expressly in
this Agreement. The respective rights and obligations of the parties hereunder of this
Agreement shall survive the Executive’s termination of employment and the termination of
this Agreement to the extent necessary for the intended preservation of such rights and
obligations.

	 	16.	 	Section Headings: The section headings in this Agreement are for convenience
of reference only, and they form no part of this Agreement and shall not affect its
interpretation.

The parties have executed this Agreement as of the Effective Date, as defined above.

	 	 	 	 	 	 	 
	Wayne E. Rich	 	Prospect Global Resources Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Patrick L. Avery
	 	 
	 

	 	 	 	President and Chief Executive Officer	 	 

 

7

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