Document:

exv10w14

Exhibit 10.14

EXECUTIVE EMPLOYMENT AGREEMENT

     This Executive Employment Agreement (this “Agreement”) is made this 21st day of
May, 2010 (the “Effective Date”), by and between MOLYCORP, INC., a Delaware corporation
(“Employer”) and John Burba (“Executive”). The Employer and the Executive are referred to below
individually as a “Party” and collectively as the “Parties.”

WITNESSETH:

     WHEREAS, the Executive agrees to be employed by the Employer upon and subject to the terms
herein provided; and

     WHEREAS, the Employer agrees to employ the Executive upon and subject to the terms herein
provided.

     NOW, THEREFORE, in consideration of the foregoing and of the mutual promises, covenants and
agreements contained herein, the legal sufficiency of which is acknowledged by the Parties, and
intending to be legally bound, the Parties agree as follows:

     1. Employment. The Employer shall employ the Executive, and the Executive accepts
employment with the Employer, upon the terms and conditions set forth in this Agreement for a
period of time beginning on the date hereof and ending as provided in Section 4 (the “Employment
Period”). Notwithstanding anything in this Agreement to the contrary, the Executive will be an
at-will employee of the Employer and the Executive or the Employer may terminate the Executive’s
employment with the Employer for any reason or no reason at any time.

     2. Office and Duties. The Executive shall serve as, and have the title of, Executive
Vice President and Chief Technology Officer and shall report to, and be subject to the power and
authority of, the Chief Executive Officer. The Executive shall manage the affairs of the Employer
and have the duties, responsibilities and authority of a Executive Vice President Chief Technology
Officer. The Executive shall perform such tasks commensurate with this position as may from time to
time be defined or assigned by the Chief Executive Officer. The Executive shall devote all business
time, labor, skill, undivided attention and best ability to the performance of the Executive’s
duties hereunder in a manner which will faithfully and diligently further the business and
interests of the Employer. During the Employment Period, the Executive shall not directly or
indirectly pursue any other business activity without the prior written consent of the Board,
except as permitted under Section 7(f) of this Agreement. The Executive further agrees to travel to
whatever extent is reasonably necessary in the conduct of the Employer’s business, at the
Employer’s expense.

     3. Compensation and Benefits.

     (a) The Employer will pay the Executive a base salary for services rendered under this
Agreement at a rate of not less than $213,700 per year, payable in accordance with Employer’s
standard payroll practices, subject to such payroll and withholding deductions as are required by
law or authorized by the Executive. The Executive shall be eligible for increases in base salary at
the sole discretion of the Employer.

 

 

     (b) The Executive shall be entitled to participate in the employee benefit plans (such as
medical and dental insurance, disability, life insurance, 401k and sick pay) offered to
substantially all of the employees of the Employer. In addition, the Executive will be eligible for
the Employer’s Management Incentive Plan, which is a nonqualified deferred compensation plan to
which the Employer may make contributions and the Executive may elect to make deferral
contributions from his base salary and bonus, if any. Employer contributions to the Management
Incentive Plan are discretionary and subject to annual Board approval.

     (c) The Executive shall be eligible for such bonus plans and long-term equity or cash
incentive compensation plans for the Employer’s officers and directors as the Board may establish
from time to time, which will be based on the achievement and satisfaction of goals and objectives
established by the Board.

     (d) The Employer shall reimburse the Executive for all reasonable and actual out-of-pocket
costs and expenses, including reasonable travel and business entertainment expenses, incurred by
him in the course of performing his duties under this Agreement, subject in all instances to the
Employer’s reimbursement policies and requirements applicable to all employees with respect to
reporting and documentation of such expenses, including, without limitation, the timely submittal
of receipts, invoices and documentation supporting all such costs and expenses.

     (e) The Executive shall be entitled to 240 hours (30) days paid vacation during each 12-month
period worked, commencing on the date hereof. A maximum of 10 days of accrued but unused vacation
may be carried over from one year to the next year; any accrued but unused vacation time not
carried over will be waived and will not be deemed earned pursuant to C.R.S. §8-4-101
et seq. The Executive will keep the Board apprised of dates for planned vacation.

     4. Employment Period. Unless renewed in writing by the mutual agreement of the
Employer and the Executive, the Employment Period shall be for the period beginning on the date of
this Agreement and ending on June 1, 2013; provided, however, that (i) the Employment Period shall
terminate prior to such date upon the Executive’s resignation, death or Disability (as defined
below) and (ii) the Employment Period may be terminated by the Employer at any time prior to such
date for Cause (as defined below) or without Cause.

     5. Termination of Employment.

     (a) If the Employer terminates the Executive’s employment as a result of the Executive’s death
or the Executive’s disability or for Cause (as defined below), the Employer will pay the
Executive’s accrued salary, benefits and vacation, including the then unused accrued vacation, up
to and including the date of termination. Thereafter, the Employer will have no further obligations
to the Executive under this Agreement. For purposes of this Agreement, “Cause” is defined as: (1)
the Executive’s misconduct, malfeasance, or negligence relative to the Executives duties or the
Employer’s business; (2) the Executive’s failure or refusal to perform the services required or as
requested by the Board and or the Chief Executive Officer, or the Executive’s refusal to carry out
or perform proper directions or instructions from the Board and or the Chief Executive Officer with
respect to the services rendered hereunder; (3) the Executive’s conviction of a crime that either
results in a sentence of imprisonment or involves

 

 

theft, embezzlement, dishonesty or breach of securities or financial laws or regulations; (4)
activities by the Executive that are injurious to the Employer, its affiliates or its or their
reputation; or (5) any conduct constituting “cause” under applicable law. Whether Cause exists to
justify the termination of this Agreement shall be determined by the Employer in its sole
discretion.

     (b) If the Employer terminates the Executive’s employment without Cause or if the Executive
terminates his employment for Good Reason (as defined below), the Employer will pay to the
Executive (1) the Executive’s accrued salary and vacation, including the then unused accrued
vacation, up to and including the date of termination and (2) the equivalent of one year of the
Executive’s Base Salary, less applicable deductions and withholdings, pursuant to the Employer’s
standard pay periods and practices; provided, however, that such payments shall be deemed severance
pay and not wages. Such payment shall be made to the Executive as soon as administratively
practicable after the termination of the Executive’s employment without Cause or for Good Reason,
but no later than two and one-half months after the last day of the calendar year in which the
Executive’s employment is so terminated. It is expressly understood that the Employer’s payment
obligations under this Section 5(b) shall cease in the event the Executive breaches any of the
agreements in Sections 6 and 7 of this Agreement. Notwithstanding anything herein to the contrary,
the Company shall not be obligated to make any payment under this Section 5(b) unless (i) prior to
the sixtieth(60th) day following the termination without Cause or termination for Good
Reason, the Executive executes a release of all current or future claims, known or unknown, arising
on or before the date of the release, against the Employer and its subsidiaries and the directors,
officers, employees and affiliates of any of them, in a form approved by the Employer and (ii) any
applicable revocation period has expired during such sixty-day period without the Executive
revoking such release. Each payment under this Section 5(b) shall be considered a separate payment
and not one of a series of payments for purposes of Section 409A of the Internal Revenue Code of
1986, as amended. Any payment payable pursuant to this Section 5(b) that is not made
following the Executive’s termination without Cause or termination for Good Reason because the
Executive has not executed the release described herein shall be paid to the Executive in a single
lump sum on the first payroll date following the last day of any applicable revocation period after
the Executive executes the release; provided that the Executive executes and does not revoke the
release in accordance with the requirements set forth herein.

     For purposes of this Agreement, “Good Reason” is defined as: the Executive’s termination of
his employment within the two-year period following a Change of Control (as such term is defined in
Exhibit A to this Agreement) as a result of (i) any material diminution in the Executive’s
authority, duties or responsibilities or (ii) a relocation of the Executive’s principal office to a
location that is in excess of fifty (50) miles from its location as of the Effective Date.
Notwithstanding the foregoing, no termination of employment by the Executive shall constitute a
termination for “Good Reason” unless (A) the Executive gives the Employer notice of the existence
of an event described in clause (i) or (ii) above within sixty (60) days following the occurrence
thereof, (B) the Employer does not remedy such event within thirty (30) days of receiving the
notice described in the preceding clause (A), and (C) the Executive terminates employment within
five (5) days of the end of the cure period specified in clause (B), above.

 

 

     (c) If the Executive terminates his employment for any reason other than Good Reason, the
Employer will pay the Executive’s accrued salary and vacation, including the then unused accrued
vacation, up to and including the date of termination. Thereafter, the Employer will have no
further obligations to the Executive under this Agreement. The Executive may resign upon not less
than sixty (60) days prior written notice to the Employer, for any reason or no reason.

     6. Confidential Information Discoveries and Inventions; Work Made for Hire.

     (a) The Executive will keep in strict confidence, and will not, directly or indirectly, at any
time, during or after the Executive’s employment with the Employer, disclose, furnish, disseminate,
make available or, except in the course of performing the Executive’s duties of employment, use any
trade secrets or confidential business and technical information of the Employer or its customers
or vendors, without limitation as to when or how the Executive may have acquired such information.
Such confidential information shall include, without limitation, the Employer’s unique selling,
manufacturing and servicing methods and business techniques, training, service and business
manuals, promotional materials, training courses and other training and instructional materials,
vendor and product information, customer and prospective customer lists, other customer and
prospective customer information and other business information. The Executive specifically
acknowledges that all such confidential information, whether reduced to writing, maintained on any
form of electronic media, or maintained in the mind or memory of the Executive and whether compiled
by the Employer, and/or the Executive, derives independent economic value from not being readily
known to or ascertainable by proper means by others who can obtain economic value from its
disclosure or use, that reasonable efforts have been made by the Employer to maintain the secrecy
of such information, that such information is the sole property of the Employer and that any
retention and use of such information by the Executive during the Executive’s employment with the
Employer (except in the course of performing the Executive’s duties and obligations to the
Employer) or after the termination of the Executive’s employment shall constitute a
misappropriation of the Employer’s trade secrets.

     (b) The Executive agrees that upon termination of the Executive’s employment with the
Employer, for any reason, the Executive shall return to the Employer, in good condition, all
property of the Employer, including without limitation, the originals and all copies of any
materials which contain, reflect, summarize, describe, analyze or refer or relate to any items of
information listed in Section 6(a) of this Agreement. In the event that such items are not so
returned, the Employer will have the right to charge the Executive for all reasonable damages,
costs, attorneys’ fees and other expenses incurred in searching for, taking, removing and/or
recovering such property.

     (c) The Executive agrees that upon conception and/or development of any idea, discovery,
invention, improvement, software, writing or other material or design that: (A) relates to the
business of the Employer, or (B) relates to the Employer’s actual or demonstrably anticipated
research or development, or (C) results from any work performed by the Executive for the Employer,
the Executive will assign to the Employer the entire right, title and interest in and to any such
idea, discovery, invention, improvement, software, writing or other material or design. The
Executive has no obligation to assign any idea, discovery, invention, improvement, software,
writing or other material or design that the Executive conceives and/or develops

 

 

entirely on the Executive’s own time without using the Employer’s equipment, supplies,
facilities, or trade secret information unless the idea, discovery, invention, improvement,
software, writing or other material or design either: (x) relates to the business of the Employer,
or (y) relates to the Employer’s actual or demonstrably anticipated research or development, or (z)
results from any work performed by the Executive for the Employer. The Executive agrees that any
idea, discovery, invention, improvement, software, writing or other material or design that relates
to the business of the Employer or relates to the Employer’s actual or demonstrably anticipated
research or development which is conceived or suggested by the Executive, either solely or jointly
with others, within one (1) year following termination of the Executive’s employment under this
Agreement or any successor agreements shall be presumed to have been so made, conceived or
suggested in the course of such employment with the use of the Employer’s equipment, supplies,
facilities, and/or trade secrets.

     (d) In order to determine the rights of the Executive and the Employer in any idea, discovery,
invention, improvement, software, writing or other material, and to insure the protection of the
same, the Executive agrees that during the Executive’s employment, and for one (1) year after
termination of the Executive’s employment under this Agreement or any successor agreements the
Executive will disclose immediately and fully to the Employer any idea, discovery, invention,
improvement, software, writing or other material or design conceived, made or developed by the
Executive solely or jointly with others. The Employer agrees to keep any such disclosures
confidential. The Executive also agrees to record descriptions of all work in the manner directed
by the Employer and agrees that all such records and copies, samples and experimental materials
will be the exclusive property of the Employer. The Executive agrees that at the request of and
without charge to the Employer, but at the Employer’s expense, the Executive will execute a written
assignment of the idea, discovery, invention, improvement, software, writing or other material or
design to the Employer and will assign to the Employer any application for letters patent or for
trademark registration made thereon, and to any common-law or statutory copyright therein; and that
the Executive will do whatever may be necessary or desirable to enable the Employer to secure any
patent, trademark, copyright, or other property right therein in the United States and in any
foreign country, and any division, renewal, continuation, or continuation in part thereof, or for
any reissue of any patent issued thereon. In the event the Employer is unable, after reasonable
effort, and in any event after ten business days, to secure the Executive’s signature on a written
assignment to the Employer of any application for letters patent or to any common-law or statutory
copyright or other property right therein, whether because of the Executive’s physical or mental
incapacity or for any other reason whatsoever, the Executive irrevocably designates and appoints
the General Counsel of the Employer as the Executive’s attorney-in-fact to act on the Executive’s
behalf to execute and file any such application and to do all other lawfully permitted acts to
further the prosecution and issuance of such letters patent, copyright or trademark.

     (e) The Executive acknowledges that, to the extent permitted by law, all work papers, reports,
documentation, drawings, photographs, negatives, tapes and masters therefor, prototypes and other
materials (hereinafter, “items”), including without limitation, any and all such items generated
and maintained on any form of electronic media, generated by the Executive during the Executive’s
employment with the Employer shall be considered a “work made for hire” and that ownership of any
and all copyrights in any and all such items shall belong to the Employer. The item will recognize
the Employer as the copyright owner, will contain all proper copyright

 

 

notices, e.g., “(creation date) Molycorp, Inc., All Rights Reserved,” and will be in condition
to be registered or otherwise placed in compliance with registration or other statutory
requirements throughout the world.

     7. Non-Competition, Non-Solicitation.

     (a) For the purposes of this Agreement, “Competitive Conduct” shall be determined in good
faith by the Employer and shall include any of the following conduct whether direct or indirect, on
the Executive’s own behalf or on behalf of, or in conjunction with, any person, partnership,
corporation, company or other entity;

          (A) owning, managing, operating, controlling, being employed by, participating in,
engaging in, rendering any services for, assisting, having any financial interest in,
permitting the Executive’s name to be used in connection with, or being connected in any
manner with the ownership, management, operation, or control of any Competitor of the
Employer or its affiliates. For the purposes of this Agreement, a “Competitor” is any person
or entity that engages in the production of rare earth products, including, without
limitation, rare earth oxides, metals, alloys and magnets;

          (B) consulting with, acting as an agent for, or otherwise assisting any Competitor to
compete or prepare to compete with the Employer or its affiliates in any of the Employer’s
or its affiliate’s existing or prospective businesses or activities;

          (C) interfering with the relationship between the Employer and any current or former
employee or consultant of the Employer, including, without limitation, soliciting, inducing,
enticing, hiring, employing, or attempting to solicit, induce, entice, hire, or employ any
current or former employee or consultant of the Employer;

          (D) interfering or attempting to interfere with any transaction in which the Employer
or any of its affiliates is involved or which was pending during the term of the Executive’s
engagement with the Employer or at the date on which the Executive’s engagement with the
Employer ends, including following the acquisition of the Mountain Pass Mine;

          (E) soliciting any of the Employer’s customers or prospective customers; and/or

          (F) soliciting, inducing, or attempting to induce any current or prospective customer,
supplier or other business relation of the Employer or any of its affiliates to cease doing
business with the Employer (or any subsidiary, member, parent or other affiliate of the
Employer) or in any way interfering with the relationship between any such customer,
supplier or business relation of the Employer or its affiliates.

     (b) The Executive shall not engage in Competitive Conduct for a period of two (2) years after
termination (whether voluntary or involuntary) of the Executive’s employment with the Employer.

     (c) The Executive shall not engage in Competitive Conduct anywhere in the world.

 

 

     (d) The Executive acknowledges and agrees that the restrictive covenants in this Agreement are
designed and intended to protect the Employer’s trade secrets. The Executive further agrees that
the Employer operates in a world-wide, and not a local or regional, market, and the restrictive
covenants in this Agreement are reasonable in duration and geographic scope and are reasonably
necessary to protect the Employer’s legitimate business interests.

     (e) The Executive may serve as a non-executive director of another business or company if, and
only if, the Executive concludes that such service will not interfere with his duties hereunder,
the Executive refers such proposed service to the Board for approval, the Board determines that
such service as a director is in the best interest of the Employer and the Board authorizes the
Executive’s service as a director for such business or company.

     (f) The Employer acknowledges and agrees that the restrictions set forth in this Section 7
shall not limit or prohibit the Executive from engaging in passive investment activities and
business-related, community service, charitable and social activities that do not interfere with
the Executive’s performance of his duties or his obligations hereunder.

     (g) For purposes of Section 6 of this Agreement and this Section 7, the Employer shall include
any and all direct and indirect subsidiary, parent, affiliated, or related companies of the
Employer for which the Executive worked or had responsibility at the time of termination of his
employment and at any time during the two (2) year period prior to such termination.

     (h) If it shall be judicially determined that the Executive has violated Section 7(b) of this
Agreement, then the period applicable to each obligation that the Executive shall have been
determined to have violated shall automatically be extended by a period of time equal in length to
the period during which such violation(s) occurred.

     8. Communication of Contents of Agreement. While employed by the Employer and for two
(2) years thereafter, the Executive will communicate the contents of Sections 6 and 7 of this
Agreement to any person, firm, association, partnership, corporation
or other entity that the
Executive intends to be employed by, associated with, or represent.

     9. No Conflicts. The Executive represents and warrants that the Executive is not
presently subject to any agreement with a Competitor or potential Competitor of the Employer, or to
any other contract, oral or written, that could restrict or prevent the Executive from entering
into this Agreement or performing his duties in full accord with this Agreement.

     10. Executive Representations and Warranties. The Executive hereby represents and
warrants to the Employer that:

     (a) the execution, delivery and performance of this Agreement by the Executive does not and
will not conflict with, breach, violate or cause a default under any agreement, contract or
instrument to which the Executive is a party, or any judgment, order or decree to which the
Executive is subject;

     (b) the Executive is not a party to or bound by any employment agreement, consulting
agreement, non-compete agreement, confidentiality agreement, non-disclosure agreement or similar
agreement with any other person or entity;

 

 

     (c) the Executive has read through the entirety of this Agreement, and prior to signing it,
the Executive has been advised by independent legal counsel; and

     (d) upon the execution and delivery of this Agreement by the Employer and the Executive, this
Agreement will be a valid and binding obligation of the Executive, enforceable in accordance with
its terms.

     11. Acknowledgments. The Executive acknowledges that the covenants contained in
Sections 6 and 7, including those related to duration, geographic scope, and the scope of
prohibited conduct, are reasonable and necessary to protect the legitimate interests of the
Employer. The Executive acknowledges that the Executive is an executive and management level
employee as referenced in, and governed by, C.R.S. 8-2-113(2)(d). The Executive further
acknowledges that the covenants contained in Sections 6 and 7 are necessary to protect, and
reasonably related to the protection of, the Employer’s trade secrets, to which the Executive will
be exposed and with which the Executive will be entrusted.

     12. Equitable Remedies. The services to be rendered by the Executive and the
Confidential Information entrusted to the Executive as a result of the Executive’s employment by
the Employer are of a unique and special character, and any breach of Sections 6 and 7 will cause
the Employer immediate and irreparable injury and damage, for which monetary relief would be
inadequate or difficult to quantify. The Employer will be entitled to, in addition to all other
remedies available to it, injunctive relief and specific performance to prevent a breach and to
secure the enforcement of Sections 6 and 7. Injunctive relief may be granted immediately upon the
commencement of any such action.

     13. Entire Agreement; Amendments. This Agreement constitutes the entire understanding
between the Parties with respect to the subject matter and supersedes, terminates, and replaces any
prior or contemporaneous understandings or agreements. This Agreement may be amended, supplemented,
waived, or terminated only by a written instrument duly executed by the Parties.

     14. Headings. The headings in this Agreement are for convenience of reference only
and shall not affect its interpretation.

     15. Severability. The covenants in this Agreement shall be construed as independent
of one another, and as obligations distinct from one another and any other contract between the
Executive and the Employer. If any provision of this Agreement is held illegal, invalid, or
unenforceable, such illegality, invalidity, or unenforceability shall not affect any other
provisions hereof. It is the intention of the Parties that in the event any provision is held
illegal, invalid or unenforceable, that such provision be limited so as to effect the intent of the
Parties to the fullest extent permitted by applicable law. Any claim by the Executive against the
Employer shall not constitute a defense to enforcement by the Employer of this Agreement.

     16. Survival. The provisions of Sections 6 and 7 are independent of, and survive
after the termination of, the other portions of this Agreement.

     17. Notices. All notices, demands, waivers, consents, approvals, or other
communications required hereunder shall be in writing and shall be deemed to have been given if

 

 

delivered personally, if sent by telegram, telex or facsimile with confirmation of receipt, if
sent by certified or registered mail, postage prepaid, return receipt requested, or if sent by same
day or overnight courier service to the following addresses:

     If to the Employer, to:

Molycorp, Inc.

5619 Denver Tech Center Parkway

Suite 1000

Greenwood Village, Colorado 80111

Tel: 303-843-8040

Fax: 303-843-8082

     If to the Executive, to:

John L. Burba

c/o Molycorp, Inc.

5619 Denver Tech Center Parkway

Suite 1000

Greenwood Village, Colorado 80111

Tel: 303-843-8040

Fax: 303-843-8082

Notice of any change in any such address shall also be given in the manner set forth above.
Whenever the giving of notice is required, the giving of such notice may be waived by the Party
entitled to receive such notice.

     18. Waiver. The failure of any Party to insist upon strict performance of any of the
terms or conditions of this Agreement shall not constitute a waiver of any of such Party’s rights
hereunder.

     19. Assignment. Other than as provided below, neither Party may assign any rights or
delegate any of obligations hereunder without the prior written consent of the other Party, and
such purported assignment or delegation shall be void; provided that the Employer may assign the
Agreement to any entity that purchases the stock or assets of the Employer or any affiliate. This
Agreement binds, inures to the benefit of, and is enforceable by the successors and permitted
assigns of the Parties and does not confer any rights on any other persons or entities.

     20. Governing Law. This agreement shall be construed and enforced in accordance with
Colorado law, except for any Colorado conflict-of-law principle that might require the application
of the laws of another jurisdiction.

     21. Choice of Forum. Any dispute arising from or relating to this Agreement shall be
resolved in the District Court for the City and County of Denver or in the United States
District Court for the District of Colorado.

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     IN WITNESS WHEREOF, the Parties have executed this Agreement on the dates below:

	 	 	 	 	 	 	 	 	 

	EMPLOYER:	 	 	 	EXECUTIVE:
	 
	 	 	 	 	 	 	 	 
	MOLYCORP, INC.	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By:

	 	/s/ Mark A. Smith
	 	 	 	By:
	 	/s/ John L. Burba
	 

	 	 
	 	 	 	 	 	 
	Name: Mark A. Smith	 	 	 	Name: John L. Burba
	Title: Chief Executive Officer	 	 	 	Title: Executive Vice President/CTO
	 
	 	 	 	 	 	 	 	 
	Date: May 21,2010	 	 	 	Date: May 21, 2010

 

 

Exhibit A

For purposes of this Agreement:

     1. “Change of Control” shall mean that any other person or group (within the meaning
of Rule 13d 1 under the Exchange Act) that, as of the date hereof, is not the “beneficial owner”
(as defined in Rules 13 d-3 and 13 d-5 under the Exchange Act), directly or indirectly, of a
Controlling interest in the Employer, becomes such a “beneficial owner,” or obtains the right,
directly or indirectly, to elect a majority of the Board.

     2. “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended and in
effect from time to time, and any successor statute.

     3. “Control” shall mean (a) the ownership, directly or indirectly, of fifty percent
(50%) or more of the voting equity share capital of the Employer or (b) the possession, directly or
indirectly, of the power to direct or cause the direction of the management or policies of the
Employer, whether through the ownership of voting securities, by contract or otherwise.
“Controlling” and “Controlled” shall have correlative meanings. Without limiting the generality of
the foregoing, a person shall be deemed to Control the Employer if it owns, directly or indirectly,
a majority of the ownership or voting interests.exv10w15

Exhibit 10.15

MOLYCORP, INC.

2010 Equity and Performance Incentive Plan

     1. Purpose. The purpose of the 2010 Equity and Performance Incentive Plan is to attract and
retain directors, officers and other employees of Molycorp, Inc., a Delaware corporation, and its
Subsidiaries and to provide to such persons incentives and rewards for superior performance.

     2. Definitions. As used in this Plan,

          (a) “Appreciation Right” means a right granted pursuant to Section 5 or Section 9 of this
Plan, and will include both Tandem Appreciation Rights and Free-Standing Appreciation Rights.

          (b) “Base Price” means the price to be used as the basis for determining the Spread upon the
exercise of a Free-Standing Appreciation Right and a Tandem Appreciation Right.

          (c) “Board” means the Board of Directors of the Company and, to the extent of any delegation
by the Board to a committee (or subcommittee thereof) pursuant to Section 14 of this Plan, such
committee (or subcommittee).

          (d) “Code” means the Internal Revenue Code of 1986, as amended from time to time.

          (e) “Common Stock” means the Common Stock, par value $0.001 per share, of the Company or any
security into which such Common Stock may be changed by reason of any transaction or event of the
type referred to in Section 12 of this Plan.

          (f) “Company” means Molycorp, Inc., a Delaware corporation, and its successors.

          (g) “Date of Grant” means the date specified by the Board on which a grant of Option Rights,
Appreciation Rights, Performance Shares, Performance Units or other awards contemplated by Section
10 of this Plan, or a grant or sale of Restricted Stock, Restricted Stock Units, or other awards
contemplated by Section 10 of this Plan, will become effective (which date will not be earlier than
the date on which the Board takes action with respect thereto).

          (h) “Director” means a member of the Board of Directors of the Company.

          (i)
“Effective Date” means June 9, 2010.

          (j) “Evidence of Award” means an agreement, certificate, resolution or other type or form of
writing or other evidence approved by the Board that sets forth the terms and conditions of the
awards granted. An Evidence of Award may be in an electronic medium, may

 

 

be limited to notation on the books and records of the Company and, unless otherwise
determined by the Board, need not be signed by a representative of the Company or a Participant.

          (k) “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder, as such law, rules and regulations may be amended from time to time.

          (l) “Free-Standing Appreciation Right” means an Appreciation Right granted pursuant to Section
5 or Section 9 of this Plan that is not granted in tandem with an Option Right.

          (m) “Incentive Stock Options” means Option Rights that are intended to qualify as “incentive
stock options” under Section 422 of the Code or any successor provision.

          (n) “Management Objectives” means the measurable performance objective or objectives
established pursuant to this Plan for Participants who have received grants of Performance Shares
or Performance Units or, when so determined by the Board, Option Rights, Appreciation Rights,
Restricted Stock, Restricted Stock Units, dividend credits or other awards pursuant to this Plan.
Management Objectives may be described in terms of Company-wide objectives or objectives that are
related to the performance of the individual Participant or of the Subsidiary, division,
department, region or function within the Company or Subsidiary in which the Participant is
employed. The Management Objectives may be made relative to the performance of one or more other
companies or subsidiaries, divisions, departments, regions or functions within such other
companies, and may be made relative to an index or one or more of the performance objectives
themselves.

          If the Board determines that a change in the business, operations, corporate structure or
capital structure of the Company, or the manner in which it conducts its business, or other events
or circumstances render the Management Objectives unsuitable, the Board may in its discretion
modify such Management Objectives or the related level or levels of achievement, in whole or in
part, as the Board deems appropriate and equitable.

          (o) “Market Value per Share” means as of any particular date the closing sale price of a share
of Common Stock as reported on the New York Stock Exchange or, if not listed on such exchange, on
any other national securities exchange on which the Common Stock is listed. If the Common Stock is
not traded as of any given date, the Market Value per Share means the closing price for a share of
Common Stock on the principal exchange on which the Common Stock is traded for the immediately
preceding date on which the Common Stock is traded. If there is no regular public trading market
for the Common Stock, the Market Value per Share shall be the fair market value of a share of
Common Stock as determined in good faith by the Board. The Board is authorized to adopt another
fair market value pricing method, provided such method is stated in the Evidence of Award, and is
in compliance with the fair market value pricing rules set forth in Section 409A of the Code.

          (p) “Non-Employee Director” means a person who is a “Non-Employee Director” of the Company
within the meaning of Rule 16b-3 of the Securities and Exchange Commission promulgated under the
Exchange Act.

2

 

          (q) “Optionee” means the optionee named in an Evidence of Award evidencing an outstanding
Option Right.

          (r) “Option Price” means the purchase price payable on exercise of an Option Right.

          (s) “Option Right” means the right to purchase Common Stock upon exercise of an option granted
pursuant to Section 4 or Section 9 of this Plan.

          (t) “Participant” means a person who is selected by the Board to receive benefits under this
Plan and who is at the time an officer or other key employee of the Company or any one or more of
its Subsidiaries, or who has agreed to commence serving in any of such capacities within 90 days of
the Date of Grant, and will also include each non-employee Director who receives Common Stock or an
award of Option Rights, Appreciation Rights, Restricted Stock, Restricted Stock Units or other
awards under this Plan. The term “Participant” shall also include any person who provides services
to the Company or a Subsidiary that are substantially equivalent to those typically provided by an
employee.

          (u) “Performance Period” means, in respect of a Performance Share or Performance Unit, a
period of time established pursuant to Section 8 of this Plan within which the Management
Objectives relating to such Performance Share or Performance Unit are to be achieved.

          (v) “Performance Share” means a bookkeeping entry that records the equivalent of one share of
Common Stock awarded pursuant to Section 8 of this Plan.

          (w) “Performance Unit” means a bookkeeping entry awarded pursuant to Section 8 of this Plan
that records a unit equivalent to $1.00 or such other value as is determined by the Board.

          (x) “Plan” means this Molycorp, Inc. 2010 Equity and Performance Incentive Plan, as may be
amended from time to time.

          (y) “Restricted Stock” means Common Stock granted or sold pursuant to Section 6 or Section 9
of this Plan as to which neither the substantial risk of forfeiture nor the prohibition on
transfers has expired.

          (z) “Restriction Period” means the period of time during which Restricted Stock Units are
subject to restrictions, as provided in Section 7 or Section 9 of this Plan.

          (aa) “Restricted Stock Unit” means an award made pursuant to Section 7 or Section 9 of this
Plan of the right to receive Common Stock or cash at the end of a specified period.

          (bb) “Spread” means the excess of the Market Value per Share on the date when an Appreciation
Right is exercised, or on the date when Option Rights are surrendered in payment of the Option
Price of other Option Rights, over the Option Price or Base Price provided for in the related
Option Right or Free-Standing Appreciation Right, respectively.

3

 

          (cc) “Subsidiary” means a corporation, company or other entity (i) more than 50 percent of
whose outstanding shares or securities (representing the right to vote for the election of
directors or other managing authority) are, or (ii) which does not have outstanding shares or
securities (as may be the case in a partnership, joint venture or unincorporated association), but
more than 50 percent of whose ownership interest representing the right generally to make decisions
for such other entity is, now or hereafter, owned or controlled, directly or indirectly, by the
Company except that for purposes of determining whether any person may be a Participant for
purposes of any grant of Incentive Stock Options, “Subsidiary” means any corporation in which at
the time the Company owns or controls, directly or indirectly, more than 50 percent of the total
combined voting power represented by all classes of stock issued by such corporation.

          (dd) “Tandem Appreciation Right” means an Appreciation Right granted pursuant to Section 5 or
Section 9 of this Plan that is granted in tandem with an Option Right.

     3. Shares Available Under the Plan.

          (a) Maximum Shares Available Under Plan.

	 	(i)	 	Subject to adjustment as provided in Section 12 of this Plan,
the number of shares of Common Stock that may be issued or transferred (A) upon
the exercise of Option Rights or Appreciation Rights, (B) in payment of
Restricted Stock and released from substantial risks of forfeiture thereof, (C)
in payment of Restricted Stock Units, (D) in payment of Performance Shares or
Performance Units that have been earned, (E) as awards to Non-Employee
Directors, (F) as awards contemplated by Section 10 of this Plan, or (G) in
payment of dividend equivalents paid with respect to awards made under the
Plan, will not exceed in the aggregate the sum of (1) 5% of the number of
            shares of Common Stock outstanding immediately prior to the Company’s
consummation of an initial public offering of Common Stock pursuant to a
registration statement filed with the Securities and Exchange Commission under
the Securities Act of 1933 (an “IPO”), giving effect to the conversion of all
of the outstanding shares of the Company’s Class A Common Stock and Class B
Common Stock into Common Stock immediately prior to the consummation of the
IPO, plus (2) 5% of the aggregate number of shares of Common Stock sold by the
Company in the IPO, including, without limitation, any shares of Common Stock
sold by the Company pursuant to the over-allotment option granted to the
underwriters in the IPO (clauses (1) and (2), the “Initial Available Shares”).
	 
	 	(ii)	 	Shares of Common Stock covered by an award granted under the
Plan shall not be counted as used unless and until they are actually issued and
delivered to a Participant and, therefore, the total number of shares of Common
Stock available under the Plan as of a given date shall not be reduced by any
Common Stock relating to prior awards that have expired or have been forfeited
or cancelled, and upon payment in cash of the

4

 

	 	 	 	benefit provided by any award granted under the Plan, any shares of Common
Stock that are covered by that award will be available for issue or transfer
hereunder. Notwithstanding anything to the contrary contained herein: (A)
if shares of Common Stock are tendered or otherwise used in payment of the
Option Price of an Option Right, the total number of shares of Common Stock
covered by the Option Right being exercised shall count against the
aggregate plan limit described above and (B) shares of Common Stock withheld
by the Company to satisfy the tax withholding obligation shall count against
the aggregate plan limit described above. In the event that the Company
repurchases Common Stock with Option Right proceeds, those shares of Common
Stock will not be added to the aggregate plan limit described above. If,
under this Plan, a Participant has elected to give up the right to receive
compensation in exchange for Common Stock based on fair market value, such
            shares of Common Stock will not count against the aggregate plan limit
described above.

          (b) Plan Limits. Notwithstanding anything in this Section 3, or elsewhere in this Plan, to
the contrary, and subject to adjustment as provided in Section 12 of this Plan, the aggregate
number of shares of Common Stock actually issued or transferred by the Company upon the exercise of
Incentive Stock Options will not exceed the number of Initial Available Shares;

     4. Option Rights. The Board may, from time to time and upon such terms and conditions as it
may determine, authorize the granting to Participants of options to purchase Common Stock. Each
such grant may utilize any or all of the authorizations, and will be subject to all of the
requirements contained in the following provisions:

          (a) Each grant will specify the number of shares of Common Stock to which it pertains subject
to the limitations set forth in Section 3 of this Plan.

          (b) Each grant will specify an Option Price per share, which may not be less than the Market
Value per Share on the Date of Grant.

          (c) Each grant will specify whether the Option Price will be payable (i) in cash or by check
acceptable to the Company or by wire transfer of immediately available funds, (ii) by the actual or
constructive transfer to the Company of Common Stock owned by the Optionee (or other consideration
authorized pursuant to Section 4(d)) having a value at the time of exercise equal to the total
Option Price, (iii) by a combination of such methods of payment, or (iv) by such other methods as
may be approved by the Board.

          (d) To the extent permitted by law, any grant may provide for deferred payment of the Option
Price from the proceeds of sale through a bank or broker on a date satisfactory to the Company of
some or all of the shares to which such exercise relates.

          (e) Successive grants may be made to the same Participant whether or not any Option Rights
previously granted to such Participant remain unexercised.

5

 

          (f) Each grant will specify the period or periods of continuous service by the Optionee with
the Company or any Subsidiary that is necessary before the Option Rights or installments thereof
will become exercisable. A grant of Option Rights may provide for the earlier exercise of such
Option Rights in the event of the retirement, death or disability of a Participant, or a change of
control, as may be defined in an Evidence of Award.

          (g) Any grant of Option Rights may specify Management Objectives that must be achieved as a
condition to the exercise of such rights.

          (h) Option Rights granted under this Plan may be (i) options, including, without limitation,
Incentive Stock Options, that are intended to qualify under particular provisions of the Code, (ii)
options that are not intended so to qualify, or (iii) combinations of the foregoing. Incentive
Stock Options may only be granted to Participants who meet the definition of “employees” under
Section 3401(c) of the Code.

          (i) No grant of Option Rights may be accompanied by a tandem award of dividend equivalents or
provide for dividends, dividend equivalents or other distributions to be paid on such Option
Rights.

          (j) The exercise of an Option Right will result in the cancellation on a share- for-share
basis of any Tandem Appreciation Right authorized under Section 5 of this Plan.

          (k) No Option Right will be exercisable more than 10 years from the Date of Grant.

          (l) The Board reserves the discretion at or after the Date of Grant to provide for the
availability of a loan at the exercise of an Option Right.

          (m) Each grant of Option Rights will be evidenced by an Evidence of Award. Each Evidence of
Award shall be subject to the Plan and shall contain such terms and provisions as the Board may
approve.

     5. Appreciation Rights.

          (a) The Board may, from time to time and upon such terms and conditions as it may determine,
authorize the granting (i) to any Optionee, of Tandem Appreciation Rights in respect of Option
Rights granted hereunder, and (ii) to any Participant, of Free-Standing Appreciation Rights. A
Tandem Appreciation Right will be a right of the Optionee, exercisable by surrender of the related
Option Right, to receive from the Company an amount determined by the Board, which will be
expressed as a percentage of the Spread (not exceeding 100 percent) at the time of exercise.
Tandem Appreciation Rights may be granted at any time prior to the exercise or termination of the
related Option Rights; provided, however, that a Tandem Appreciation Right awarded
in relation to an Incentive Stock Option must be granted concurrently with such Incentive Stock
Option. A Free-Standing Appreciation Right will be a right of the Participant to receive from the
Company an amount determined by the Board, which will be expressed as a percentage of the Spread
(not exceeding 100 percent) at the time of exercise.

6

 

          (b) Each grant of Appreciation Rights may utilize any or all of the authorizations, and will
be subject to all of the requirements, contained in the following provisions:

	 	(i)	 	Any grant may specify that the amount payable on exercise of an
Appreciation Right may be paid by the Company in cash, in Common Stock or in
any combination thereof and may either grant to the Participant or retain in
the Board the right to elect among those alternatives.
	 
	 	(ii)	 	Any grant may specify that the amount payable on exercise of an
Appreciation Right may not exceed a maximum specified by the Board at the Date
of Grant.
	 
	 	(iii)	 	Any grant may specify waiting periods before exercise and
permissible exercise dates or periods.
	 
	 	(iv)	 	Any grant may specify that such Appreciation Right may be
exercised only in the event of, or earlier in the event of, the retirement,
death or disability of a Participant, or a change of control, as may be defined
in an Evidence of Award.
	 
	 	(v)	 	No grant of Appreciation Rights may be accompanied by a tandem
award of dividend equivalents or provide for dividends, dividend equivalents or
other distributions to be paid on such Appreciation Rights.
	 
	 	(vi)	 	Any grant of Appreciation Rights may specify Management
Objectives that must be achieved as a condition of the exercise of such
Appreciation Rights.
	 
	 	(vii)	 	Each grant of Appreciation Rights will be evidenced by an
Evidence of Award, which Evidence of Award will describe such Appreciation
Rights, identify the related Option Rights (if applicable), and contain such
other terms and provisions, consistent with this Plan, as the Board may
approve.

          (c) Any grant of Tandem Appreciation Rights will provide that such Tandem Appreciation Rights
may be exercised only at a time when the related Option Right is also exercisable and at a time
when the Spread is positive, and by surrender of the related Option Right for cancellation.
Successive grants of Tandem Appreciation Rights may be made to the same Participant regardless of
whether any Tandem Appreciation Rights previously granted to the Participant remain unexercised.

          (d) Regarding Free-Standing Appreciation Rights only:

	 	(i)	 	Each grant will specify in respect of each Free-Standing
Appreciation Right a Base Price, which will be equal to or greater than the
Market Value per Share on the Date of Grant;

7

 

	 	(ii)	 	Successive grants of Free-Standing Appreciation Rights may be
made to the same Participant regardless of whether any Free-Standing
Appreciation Rights previously granted to the Participant remain unexercised;
and

	 	(iii)	 	No Free-Standing Appreciation Right granted under this Plan
may be exercised more than 10 years from the Date of Grant.

     6. Restricted Stock. The Board may, from time to time and upon such terms and conditions as
it may determine, also authorize the grant or sale of Restricted Stock to Participants. Each such
grant or sale may utilize any or all of the authorizations, and will be subject to all of the
requirements, contained in the following provisions:

          (a) Each such grant or sale will constitute an immediate transfer of the ownership of Common
Stock to the Participant in consideration of the performance of services, entitling such
Participant to voting, dividend and other ownership rights, but subject to the substantial risk of
forfeiture and restrictions on transfer hereinafter referred to.

          (b) Each such grant or sale may be made without additional consideration or in consideration
of a payment by such Participant that is less than the Market Value per Share at the Date of Grant.

          (c) Each such grant or sale will provide that the Restricted Stock covered by such grant or
sale that vests upon the passage of time will be subject to a “substantial risk of forfeiture”
within the meaning of Section 83 of the Code for a period to be determined by the Board at the Date
of Grant or upon achievement of Management Objectives referred to in subparagraph (e) below.

          (d) Each such grant or sale will provide that during or after the period for which such
substantial risk of forfeiture is to continue, the transferability of the Restricted Stock will be
prohibited or restricted in the manner and to the extent prescribed by the Board at the Date of
Grant (which restrictions may include, without limitation, rights of repurchase or first refusal in
the Company or provisions subjecting the Restricted Stock to a continuing substantial risk of
forfeiture in the hands of any transferee).

          (e) Any grant of Restricted Stock may specify Management Objectives that, if achieved, will
result in termination or early termination of the restrictions applicable to such Restricted Stock.
Each grant may specify in respect of such Management Objectives a minimum acceptable level of
achievement and may set forth a formula for determining the number of shares of Restricted Stock on
which restrictions will terminate if performance is at or above the minimum or threshold level or
levels, or is at or above the target level or levels, but falls short of maximum achievement of the
specified Management Objectives.

          (f) Notwithstanding anything to the contrary contained in this Plan, any grant or sale of
Restricted Stock may provide for the earlier termination of restrictions on such Restricted Stock
in the event of the retirement, death or disability of a Participant, or a change of control, as
may be defined in an Evidence of Award.

8

 

          (g) Any such grant or sale of Restricted Stock may require that any or all dividends or other
distributions paid thereon during the period of such restrictions be automatically deferred and
reinvested in additional shares of Restricted Stock, which may be subject to the same restrictions
as the underlying award.

          (h) Each grant or sale of Restricted Stock will be evidenced by an Evidence of Award and will
contain such terms and provisions, consistent with this Plan, as the Board may approve. Unless
otherwise directed by the Board, (i) all certificates representing shares of Restricted Stock will
be held in custody by the Company until all restrictions thereon will have lapsed, together with a
stock power or powers executed by the Participant in whose name such certificates are registered,
endorsed in blank and covering such Shares, or (ii) all shares of Restricted Stock will be held at
the Company’s transfer agent in book entry form with appropriate restrictions relating to the
transfer of such shares of Restricted Stock.

     7. Restricted Stock Units. The Board may, from time to time and upon such terms and
conditions as it may determine, also authorize the granting or sale of Restricted Stock Units to
Participants. Each such grant or sale may utilize any or all of the authorizations, and will be
subject to all of the requirements contained in the following provisions:

          (a) Each such grant or sale will constitute the agreement by the Company to deliver Common
Stock or cash to the Participant in the future in consideration of the performance of services, but
subject to the fulfillment of such conditions (which may include the achievement of Management
Objectives) during the Restriction Period as the Board may specify. Each grant may specify in
respect of such Management Objectives a minimum acceptable level of achievement and may set forth a
formula for determining the number of Common Shares subject to the Restricted Stock Units as to
which restrictions will terminate if performance is at or above the minimum or threshold level or
levels, or is at or above the target level or levels, but falls short of maximum achievement of the
specified Management Objectives.

          (b) Each such grant or sale may be made without additional consideration or in consideration
of a payment by such Participant that is less than the Market Value per Share at the Date of Grant.

          (c) Notwithstanding anything to the contrary contained in this Plan, any grant or sale of
Restricted Stock Units may provide for the earlier lapse or modification of the Restriction Period
in the event of the retirement, death or disability of a Participant, or a change of control, as
may be defined in an Evidence of Award.

          (d) During the Restriction Period, the Participant will have no right to transfer any rights
under his or her award and will have no rights of ownership in the Restricted Stock Units and will
have no right to vote the Common Shares subject to the Restricted Stock Units, but the Board may at
the Date of Grant authorize the payment of dividend equivalents on either a current, deferred or
contingent basis, either in cash or in additional shares of Common Stock.

          (e) Each grant or sale of Restricted Stock Units will specify the time and manner of payment
of the Restricted Stock Units that have been earned. Each grant or sale will

9

 

specify that the amount payable with respect thereto will be paid by the Company in Common
Stock or cash.

          (f) Each grant or sale of Restricted Stock Units will be evidenced by an Evidence of Award and
will contain such terms and provisions, consistent with this Plan, as the Board may approve.

     8. Performance Shares and Performance Units. The Board may, from time to time and upon such
terms and conditions as it may determine, also authorize the granting of Performance Shares and
Performance Units that will become payable to a Participant upon achievement of specified
Management Objectives during the Performance Period. Each such grant may utilize any or all of the
authorizations, and will be subject to all of the requirements, contained in the following
provisions:

          (a) Each grant will specify the number of Performance Shares or Performance Units to which it
pertains, which number may be subject to adjustment to reflect changes in compensation or other
factors.

          (b) The Performance Period with respect to each Performance Share or Performance Unit will be
such period of time, commencing with the Date of Grant as will be determined by the Board at the
time of grant which may be subject to earlier lapse or other modification in the event of the
retirement, death or disability of a Participant, or a change of control, as may be defined in an
Evidence of Award.

          (c) Any grant of Performance Shares or Performance Units will specify Management Objectives
which, if achieved, will result in payment or early payment of the award, and each grant may
specify in respect of such Management Objectives a minimum acceptable level of achievement and may
set forth a formula for determining the number of Performance Shares or Performance Units that will
be earned if performance is at or above the minimum or threshold level or levels, or is at or above
the target level or levels, but falls short of maximum achievement of the specified Management
Objectives. The grant of Performance Shares or Performance Units will specify that, before the
Performance Shares or Performance Units will be earned and paid, the Board must certify that the
Management Objectives have been satisfied.

          (d) Each grant will specify the time and manner of payment of Performance Shares or
Performance Units that have been earned. Any grant may specify that the amount payable with
respect thereto may be paid by the Company in cash, in Common Stock or in any combination thereof
and may either grant to the Participant or retain in the Board the right to elect among those
alternatives.

          (e) Any grant of Performance Shares or Performance Units may specify that the amount payable
or the number of shares of Common Stock issued with respect thereto may not exceed maximums
specified by the Board at the Date of Grant.

          (f) The Board may at the Date of Grant of Performance Shares provide for the payment of
dividend equivalents to the holder thereof either in cash or in additional shares of

10

 

Common Stock subject in all cases to payment on a contingent basis based on the Participant’s
earning of the Performance Shares with respect to which such dividend equivalents are paid.

          (g) Each grant of Performance Shares or Performance Units will be evidenced by an Evidence of
Award and will contain such other terms and provisions, consistent with this Plan, as the Board may
approve.

     9. Awards to Non-Employee Directors. The Board may, from time to time and upon such terms and
conditions as it may determine, authorize the granting to non-employee Directors of Option Rights,
Appreciation Rights or other awards contemplated by Section 10 of this Plan and may also authorize
the grant or sale of Common Stock, Restricted Stock or Restricted Stock Units to non-employee
Directors. Each grant of an award to a non-employee Director will be upon such terms and
conditions as approved by the Board, will not be required to be subject to any minimum vesting
period, and will be evidenced by an Evidence of Award in such form as will be approved by the
Board. Each grant will specify in the case of an Option Right, an Option Price per share, and in
the case of a Free-Standing Appreciation Right, a Base Price per share, which will not be less than
the Market Value per Share on the Date of Grant. Each Option Right and Free-Standing Appreciation
Right granted under the Plan to a non-employee Director will expire not more than 10 years from the
Date of Grant and will be subject to earlier termination as hereinafter provided. If a
non-employee Director subsequently becomes an employee of the Company or a Subsidiary while
remaining a member of the Board, any award held under this Plan by such individual at the time of
such commencement of employment will not be affected thereby. Non-employee Directors, pursuant to
this Section 9, may be awarded, or may be permitted to elect to receive, pursuant to procedures
established by the Board, all or any portion of their annual retainer, meeting fees or other fees
in Common Stock, Restricted Stock, Restricted Stock Units or other awards under the Plan in lieu of
cash.

     10. Other Awards.

          (a) The Board may, subject to limitations under applicable law, grant to any Participant such
other awards that may be denominated or payable in, valued in whole or in part by reference to, or
otherwise based on, or related to, shares of Common Stock or factors that may influence the value
of such shares, including, without limitation, convertible or exchangeable debt securities, other
rights convertible or exchangeable into Common Stock, purchase rights for Common Stock, awards with
value and payment contingent upon performance of the Company or specified Subsidiaries, affiliates
or other business units thereof or any other factors designated by the Board, and awards valued by
reference to the book value of shares of Common Stock or the value of securities of, or the
performance of specified Subsidiaries or affiliates or other business units of the Company. The
Board shall determine the terms and conditions of such awards. Shares of Common Stock delivered
pursuant to an award in the nature of a purchase right granted under this Section 10 shall be
purchased for such consideration, paid for at such time, by such methods, and in such forms,
including, without limitation, cash, shares of Common Stock, other awards, notes or other property,
as the Board shall determine.

          (b) Cash awards, as an element of or supplement to any other award granted under this Plan,
may also be granted pursuant to this Section 10 of this Plan.

11

 

          (c) The Board may grant Common Stock as a bonus, or may grant other awards in lieu of
obligations of the Company or a Subsidiary to pay cash or deliver other property under this Plan or
under other plans or compensatory arrangements, subject to such terms as shall be determined by the
Board in a manner that complies with Section 409A of the Code.

          (d) Share-based awards pursuant to this Section 10 are not required to be subject to any
minimum vesting period.

     11. Transferability.

          (a) Except as otherwise determined by the Board, no Option Right, Appreciation Right or other
derivative security granted under the Plan shall be transferable by the Participant except by will
or the laws of descent and distribution, and in no event shall any such award granted under this
Plan be transferred for value. Except as otherwise determined by the Board, Option Rights and
Appreciation Rights will be exercisable during the Participant’s lifetime only by him or her or, in
the event of the Participant’s legal incapacity to do so, by his or her guardian or legal
representative acting on behalf of the Participant in a fiduciary capacity under state law and/or
court supervision.

          (b) The Board may specify at the Date of Grant that part or all of the shares of Common Stock
that are (i) to be issued or transferred by the Company upon the exercise of Option Rights or
Appreciation Rights, upon the termination of the Restriction Period applicable to Restricted Stock
Units or upon payment under any grant of Performance Shares or Performance Units or (ii) no longer
subject to the substantial risk of forfeiture and restrictions on transfer referred to in Section 6
of this Plan, will be subject to further restrictions on transfer.

     12. Adjustments. The Board shall make or provide for such adjustments in the numbers of
shares of Common Stock covered by outstanding Option Rights, Appreciation Rights, Restricted Stock
Units, Performance Shares and Performance Units granted hereunder and, if applicable, in the number
of shares of Common Stock covered by other awards granted pursuant to Section 10 hereof, in the
Option Price and Base Price provided in outstanding Appreciation Rights, and in the kind of shares
covered thereby, as the Board, in its sole discretion, exercised in good faith, may determine is
equitably required to prevent dilution or enlargement of the rights of Participants or Optionees
that otherwise would result from (a) any stock dividend, stock split, combination of shares,
recapitalization or other change in the capital structure of the Company, (b) any merger,
consolidation, spin-off, split- off, spin-out, split-up, reorganization, partial or complete
liquidation or other distribution of assets, issuance of rights or warrants to purchase securities,
or (c) any other corporate transaction or event having an effect similar to any of the foregoing.
Moreover, in the event of any such transaction or event or in the event of a change of control, the
Board, in its discretion, may provide in substitution for any or all outstanding awards under this
Plan such alternative consideration (including cash), if any, as it, in good faith, may determine
to be equitable in the circumstances and may require in connection therewith the surrender of all
awards so replaced in a manner that complies with Section 409A of the Code. In addition, for each
Option Right or Appreciation Right with an Option Price or Base Price greater than the
consideration offered in connection with any such transaction or event or change of control, the
Board may in its sole discretion elect to cancel such

12

 

Option Right or Appreciation Right without any payment to the person holding such Option Right
or Appreciation Right. The Board shall also make or provide for such adjustments in the numbers of
shares of Common Stock specified in Section 3 of this Plan as the Board in its sole discretion,
exercised in good faith, may determine is appropriate to reflect any transaction or event described
in this Section 12; provided, however, that any such adjustment to the number
specified in Section 3(c)(i) will be made only if and to the extent that such adjustment would not
cause any option intended to qualify as an Incentive Stock Option to fail to so qualify.

     13. Administration of the Plan.

          (a) This Plan will be administered by the Board, which may from time to time delegate all or
any part of its authority under this Plan to the Compensation Committee of the Board (or a
subcommittee thereof), as constituted from time to time. To the extent of any such delegation,
references in this Plan to the Board will be deemed to be references to such committee or
subcommittee. A majority of the committee (or subcommittee) will constitute a quorum, and the
action of the members of the committee (or subcommittee) present at any meeting at which a quorum
is present, or acts unanimously approved in writing, will be the acts of the committee (or
subcommittee).

          (b) The interpretation and construction by the Board of any provision of this Plan or of any
agreement, notification or document evidencing the grant of Option Rights, Appreciation Rights,
Restricted Stock, Restricted Stock Units, Performance Shares, Performance Units or other awards
pursuant to Section 10 of this Plan and any determination by the Board pursuant to any provision of
this Plan or of any such agreement, notification or document will be final and conclusive. No
member of the Board will be liable for any such action or determination made in good faith.

          (c) The Board or, to the extent of any delegation as provided in Section 13(a), the committee,
may delegate to one or more of its members or to one or more officers of the Company, or to one or
more agents or advisors, such administrative duties or powers as it may deem advisable, and the
Board, the committee, or any person to whom duties or powers have been delegated as aforesaid, may
employ one or more persons to render advice with respect to any responsibility the Board, the
committee or such person may have under the Plan. The Board or the committee may, by resolution,
authorize one or more officers of the Company to do one or both of the following on the same basis
as the Board or the committee: (i) designate employees to be recipients of awards under this Plan;
(ii) determine the size of any such awards; provided, however, that (A) the Board
or the committee shall not delegate such responsibilities to any such officer for awards granted to
an employee who is an officer, Director, or more than 10% beneficial owner of any class of the
Company’s equity securities that is registered pursuant to Section 12 of the Exchange Act, as
determined by the Board in accordance with Section 16 of the Exchange Act; (B) the resolution
providing for such authorization sets forth the total number of shares of Common Stock such
officer(s) may grant; and (C) the officer(s) shall report periodically to the Board or the
committee, as the case may be, regarding the nature and scope of the awards granted pursuant to the
authority delegated.

     14. Recapture Provisions. Any Evidence of Award may provide for the cancellation or
forfeiture of an award or the forfeiture and repayment to the Company of any gain related to

13

 

an award, or other provisions intended to have a similar effect, upon such terms and
conditions as may be determined from time to time by the Board.

     15. Non U.S. Participants. In order to facilitate the making of any grant or combination of
grants under this Plan, the Board may provide for such special terms for awards to Participants who
are foreign nationals or who are employed by the Company or any Subsidiary outside of the United
States of America or who provide services to the Company under an agreement with a foreign nation
or agency, as the Board may consider necessary or appropriate to accommodate differences in local
law, tax policy or custom. Moreover, the Board may approve such supplements to or amendments,
restatements or alternative versions of this Plan (including without limitation, sub-plans) as it
may consider necessary or appropriate for such purposes, without thereby affecting the terms of
this Plan as in effect for any other purpose, and the Secretary or other appropriate officer of the
Company may certify any such document as having been approved and adopted in the same manner as
this Plan. No such special terms, supplements, amendments or restatements, however, will include
any provisions that are inconsistent with the terms of this Plan as then in effect unless this Plan
could have been amended to eliminate such inconsistency without further approval by the
stockholders of the Company.

     16. Withholding Taxes. To the extent that the Company is required to withhold federal, state,
local or foreign taxes in connection with any payment made or benefit realized by a Participant or
other person under this Plan, and the amounts available to the Company for such withholding are
insufficient, it will be a condition to the receipt of such payment or the realization of such
benefit that the Participant or such other person make arrangements satisfactory to the Company for
payment of the balance of such taxes required to be withheld, which arrangements (in the discretion
of the Board) may include relinquishment of a portion of such benefit. If a Participant’s benefit
is to be received in the form of Common Stock, and such Participant fails to make arrangements for
the payment of tax, the Company shall withhold such shares of Common Stock having a value equal to
the amount required to be withheld. Notwithstanding the foregoing, when a Participant is required
to pay the Company an amount required to be withheld under applicable income and employment tax
laws, the Participant may elect to satisfy the obligation, in whole or in part, by electing to have
withheld, from the shares required to be delivered to the Participant, shares of Common Stock
having a value equal to the amount required to be withheld, or by delivering to the Company other
shares of Common Stock held by such Participant. The shares used for tax withholding will be
valued at an amount equal to the Market Value per Share of such Common Stock on the date the
benefit is to be included in Participant’s income. In no event shall the Market Value per Share of
the Common Stock to be withheld and delivered pursuant to this Section 16 to satisfy applicable
withholding taxes in connection with the benefit exceed the minimum amount of taxes required to be
withheld. Participants shall also make such arrangements as the Company may require for the
payment of any withholding tax obligation that may arise in connection with the disposition of
shares of Common Stock acquired upon the exercise of Option Rights.

     17. Amendments, Etc.

          (a) The Board may at any time and from time to time amend the Plan in whole or in part;
provided, however, that if an amendment to the Plan (i) would materially

14

 

increase the benefits accruing to participants under the Plan, (ii) would materially increase
the number of securities which may be issued under the Plan, (iii) would materially modify the
requirements for participation in the Plan or (iv) must otherwise be approved by the stockholders
of the Company in order to comply with applicable law or the rules of the New York Stock Exchange
or, if the Common Stock is not traded on New York Stock Exchange, the principal national securities
exchange upon which the Common Stock is traded or quoted, then, such amendment will be subject to
stockholder approval and will not be effective unless and until such approval has been obtained.

          (b) Except in connection with a corporate transaction or event described in Section 12 of this
Plan, the terms of outstanding awards may not be amended to reduce the Option Price of outstanding
Option Rights or the Base Price of outstanding Appreciation Rights, or cancel outstanding Option
Rights or Appreciation Rights in exchange for cash, other awards or Option Rights or Appreciation
Rights with an Option Price or Base Price, as applicable, that is less than the Option Price of the
original Option Rights or Base Price of the original Appreciation Rights, as applicable, without
stockholder approval.

          (c) If permitted by Section 409A of the Code, but subject to Section 17(d) hereof, in case of
termination of employment by reason of death, disability or normal or early retirement, or in the
case of unforeseeable emergency or other special circumstances, of a Participant who holds an
Option Right or Appreciation Right not immediately exercisable in full, or any shares of Restricted
Stock as to which the substantial risk of forfeiture or the prohibition or restriction on transfer
has not lapsed, or any Restricted Stock Units as to which the Restriction Period has not been
completed, or any Performance Shares or Performance Units which have not been fully earned, or any
other awards made pursuant to Section 10 subject to any vesting schedule or transfer restriction,
or who holds Common Stock subject to any transfer restriction imposed pursuant to Section 11(b) of
this Plan, or in the case of a change of control, the Board may, in its sole discretion, accelerate
the time at which such Option Right, Appreciation Right or other award may be exercised or the time
at which such substantial risk of forfeiture or prohibition or restriction on transfer will lapse
or the time when such Restriction Period will end or the time at which such Performance Shares or
Performance Units will be deemed to have been fully earned or the time when such transfer
restriction will terminate or may waive any other limitation or requirement under any such award.

          (d) Subject to Section 17(b) hereof, the Board may amend the terms of any award theretofore
granted under this Plan prospectively or retroactively. Subject to Section 12 above, no such
amendment shall impair the rights of any Participant without his or her consent. The Board may, in
its discretion, terminate this Plan at any time. Termination of this Plan will not affect the
rights of Participants or their successors under any awards outstanding hereunder and not exercised
in full on the date of termination.

     18. Compliance with Section 409A of the Code.

          (a) To the extent applicable, it is intended that this Plan and any grants made hereunder
comply with the provisions of Section 409A of the Code, so that the income inclusion provisions of
Section 409A(a)(1) of the Code do not apply to the Participants. This Plan and any grants made
hereunder shall be administered in a manner consistent with this intent. Any

15

 

reference in this Plan to Section 409A of the Code will also include any regulations or any
other formal guidance promulgated with respect to such Section by the U.S. Department of the
Treasury or the Internal Revenue Service.

          (b) Neither a Participant nor any of a Participant’s creditors or beneficiaries shall have the
right to subject any deferred compensation (within the meaning of Section 409A of the Code) payable
under this Plan and grants hereunder to any anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance, attachment or garnishment. Except as permitted under Section 409A of the
Code, any deferred compensation (within the meaning of Section 409A of the Code) payable to a
Participant or for a Participant’s benefit under this Plan and grants hereunder may not be reduced
by, or offset against, any amount owing by a Participant to the Company or any of its affiliates.

          (c) If, at the time of a Participant’s separation from service (within the meaning of Section
409A of the Code), (i) the Participant shall be a specified employee (within the meaning of Section
409A of the Code and using the identification methodology selected by the Company from time to
time) and (ii) the Company shall make a good faith determination that an amount payable hereunder
constitutes deferred compensation (within the meaning of Section 409A of the Code) the payment of
which is required to be delayed pursuant to the six-month delay rule set forth in Section 409A of
the Code in order to avoid taxes or penalties under Section 409A of the Code, then the Company
shall not pay such amount on the otherwise scheduled payment date but shall instead pay it, without
interest, on the tenth business day of the seventh month after such separation of service.

          (d) Notwithstanding any provision of this Plan and grants hereunder to the contrary, in light
of the uncertainty with respect to the proper application of Section 409A of the Code, the Company
reserves the right to make amendments to this Plan and grants hereunder as the Company deems
necessary or desirable to avoid the imposition of taxes or penalties under Section 409A of the
Code. In any case, a Participant shall be solely responsible and liable for the satisfaction of
all taxes and penalties that may be imposed on a Participant or for a Participant’s account in
connection with this Plan and grants hereunder (including any taxes and penalties under Section
409A of the Code), and neither the Company nor any of its affiliates shall have any obligation to
indemnify or otherwise hold a Participant harmless from any or all of such taxes or penalties.

     19. Governing Law. The Plan and all grants and awards and actions taken thereunder shall be
governed by and construed in accordance with the internal substantive laws of the State of
Delaware.

     20. Effective Date/Termination. This Plan will be effective as of the Effective Date, which
is the date on which the Plan is adopted by the Board; provided, however, that no
awards may be granted under the Plan until the consummation of the IPO. The Plan shall be
submitted to the Company’s stockholders for approval. Unless the Plan is approved by the Company’s
stockholders within twelve (12) months after the Effective Date, the Plan and all Awards made under
it shall be void and of no force and effect. No grant will be made under this Plan after the tenth
anniversary of the Effective Date, but all grants made on or prior to such date will continue in
effect thereafter subject to the terms thereof and of this Plan.

16

 

     21. Miscellaneous.

          (a) The Company will not be required to issue any fractional shares of Common Stock pursuant
to this Plan. The Board may provide for the elimination of fractions or for the settlement of
fractions in cash.

          (b) This Plan will not confer upon any Participant any right with respect to continuance of
employment or other service with the Company or any Subsidiary, nor will it interfere in any way
with any right the Company or any Subsidiary would otherwise have to terminate such Participant’s
employment or other service at any time.

          (c) To the extent that any provision of this Plan would prevent any Option Right that was
intended to qualify as an Incentive Stock Option from qualifying as such, that provision will be
null and void with respect to such Option Right. Such provision, however, will remain in effect
for other Option Rights and there will be no further effect on any provision of this Plan.

          (d) No award under this Plan may be exercised by the holder thereof if such exercise, and the
receipt of cash or stock thereunder, would be, in the opinion of counsel selected by the Board,
contrary to law or the regulations of any duly constituted authority having jurisdiction over this
Plan.

          (e) Absence or leave approved by a duly constituted officer of the Company or any of its
Subsidiaries shall not be considered interruption or termination of service of any employee for any
purposes of this Plan or awards granted hereunder.

          (f) No Participant shall have any rights as a stockholder with respect to any shares subject
to awards granted to him or her under this Plan prior to the date as of which he or she is actually
recorded as the holder of such shares upon the stock records of the Company.

          (g) The Board may condition the grant of any award or combination of awards authorized under
this Plan on the surrender or deferral by the Participant of his or her right to receive a cash
bonus or other compensation otherwise payable by the Company or a Subsidiary to the Participant.

          (h) If any provision of the Plan is or becomes invalid, illegal or unenforceable in any
jurisdiction, or would disqualify the Plan or any award under any law deemed applicable by the
Board, such provision shall be construed or deemed amended or limited in scope to conform to
applicable laws or, in the discretion of the Board, it shall be stricken and the remainder of the
Plan shall remain in full force and effect.

17

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