Document:

exv4w1

 

Exhibit 4.1

CARRIAGE SERVICES, INC.

CERTIFICATE OF DESIGNATIONS

OF

MANDATORILY REDEEMABLE CONVERTIBLE PREFERRED STOCK, SERIES A

Pursuant to Section 151 of the

General Corporation Law of the State of Delaware

     The undersigned DOES HEREBY CERTIFY that the following resolution was duly adopted by the
Board of Directors of Carriage Services, Inc., a Delaware corporation (hereinafter called the
“Corporation”), with the preferences and rights set forth therein relating to dividends,
conversion, redemption, dissolution and distribution of assets of the Corporation having been fixed
by the Board of Directors pursuant to authority granted to it under Article IV of the Corporation’s
Amended and Restated Certificate of Incorporation, as amended, and in accordance with the
provisions of Section 151 of the General Corporation Law of the State of Delaware:

     RESOLVED that, pursuant to authority conferred upon the Board of Directors by the provisions
of Article IV of the Amended and Restated Certificate of Incorporation of the Corporation, as
amended, the Board of Directors hereby authorizes the issue of a new series of the Corporation’s
authorized preferred stock, par value $.01 per share, designated the Mandatorily Redeemable
Convertible Preferred Stock, Series A, and hereby fixes the designations, powers, preferences and
relative, participating, optional or other special rights, and the qualifications, limitations or
restrictions thereof, of such shares, in addition to those set forth in the Amended and Restated
Certificate of Incorporation of the Corporation, as amended (the “Certificate of Incorporation”),
as follows:

     1. DESIGNATION AND AMOUNT. The shares of such series shall be designated “Mandatorily
Redeemable Convertible Preferred Stock, Series A” (the “Series A Preferred Stock”) and the number
of shares constituting such series shall be 20,000.

     2. DIVIDENDS.

     a)     The last day of March, June, September and December on which the Series A Preferred Stock
shall be outstanding shall be deemed to be a “Dividend Due Date” (except that if any such date is a
Saturday, Sunday or legal holiday, then the next succeeding date that is not a Saturday, Sunday or
legal holiday shall be the Dividend Due Date, and except that the first Dividend Due Date will not
be earlier than December 31, 2007). The holders of Series A Preferred Stock shall be entitled to
receive, if, when and as declared by the Board of Directors out of funds legally available
therefor, cumulative dividends at the rate of 7% of the Stated Value, defined below, per share per
annum, calculated on the basis of a year of 360 days consisting of twelve 30-day months, payable
quarterly on each Dividend Due Date, with respect to the quarter ending on the Dividend Due Date.
Dividends will be paid in cash. The record date for the payment of the aforementioned dividends
shall be the fifteenth day of March, June, September or December, as the case may be, immediately
preceding the relevant Dividend Due

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Date. For purposes hereof, the term “legal holiday” shall mean any day on which banking
institutions are authorized to close in Houston, Texas.

     b)     On each Dividend Due Date all dividends which shall be accumulated on each share of Series
A Preferred Stock outstanding on such Dividend Due Date shall be deemed to become “due.” Any
dividend which shall not be paid on the Dividend Due Date on which it shall become due shall be
deemed to be “past due” until such dividend shall be paid or until the share of Series A Preferred
Stock with respect to which such dividend became due shall no longer be outstanding, whichever is
the earlier to occur.

     c)     Any reference to “dividend” or “distribution” in this Section 2 shall not be deemed to
include any distribution made in connection with any liquidation, dissolution or winding up of the
Corporation, whether voluntary or involuntary.

     3. LIQUIDATION, DISSOLUTION OR WINDING UP.

     a)     In the event of any voluntary or involuntary liquidation, dissolution or winding up of the
Corporation, the holders of shares of Series A Preferred Stock then outstanding shall be entitled
to be paid out of the assets of the Corporation available for distribution to its stockholders,
after and subject to the payment in full of all amounts required to be distributed to the holders
of any other Preferred Stock of the Corporation ranking on liquidation prior and in preference to
the Series A Preferred Stock (such Preferred Stock being referred to hereinafter as “Senior
Preferred Stock”) upon such liquidation, dissolution or winding up, an amount in cash equal to the
Stated Value per share plus any accrued but unpaid dividends thereon (whether or not declared)
through the date of such liquidation, dissolution or winding up. For purposes hereof, the term
“Stated Value” shall mean $10.00 per share, subject to appropriate adjustment in the event of any
stock dividend, stock split, stock distribution or combination with respect to the Series A
Preferred Stock. If upon any such liquidation, dissolution or winding up of the Corporation the
remaining assets of the Corporation available for the distribution to its stockholders after
payment in full of amounts required to be paid or distributed to holders of Senior Preferred Stock
shall be insufficient to pay the holders of shares of Series A Preferred Stock the full amount to
which they shall be entitled, the holders of shares of Series A Preferred Stock, and any class of
stock ranking on liquidation on a parity with the Series A Preferred Stock, shall share ratably in
any distribution of the remaining assets and funds of the Corporation in proportion to the
respective amounts which would otherwise be payable in respect to the shares held by them upon such
distribution if all amounts payable on or with respect to said shares were paid in full.

     b)     After the payment of all preferential amounts required to be paid to the holders of Senior
Preferred Stock and Series A Preferred Stock and any other series of Preferred Stock upon the
dissolution, liquidation or winding up of the Corporation, the holders of shares of Common Stock
then outstanding shall be entitled to receive the remaining assets and funds of the Corporation
available for distribution to its stockholders.

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     c)     The merger or consolidation of the Corporation into or with another corporation, the merger
or consolidation of any other corporation into or with the Corporation, or the sale, conveyance,
mortgage, pledge or lease of all or substantially all the assets of the Corporation shall not be
deemed to be a liquidation, dissolution or winding up of the Corporation for purposes of this
Section 3.

     4. VOTING.

     a)     Except as provided in this Section 4, no holder of Series A Preferred Stock shall be
entitled to any voting rights at any annual or special meeting of the stockholders of the
Corporation or otherwise.

     b)     The Corporation shall not amend, alter or repeal the preferences, special rights or other
powers of the Series A Preferred Stock or effect any change in the Certificate of Incorporation, as
then in effect, so as to affect adversely the rights, preferences or privileges of the Series A
Preferred Stock, without the written consent or affirmative vote of the holders of at least a
majority of the then outstanding shares of Series A Preferred Stock, given in writing or by vote at
a meeting, consenting or voting (as the case may be) separately as a class. For this purpose, the
authorization or issuance of any series of Preferred Stock with preference or priority over, or
being on a parity with the Series A Preferred Stock as to the right to receive either dividends or
amounts distributable upon liquidation, dissolution or winding up of the Corporation shall not be
deemed so to affect adversely the Series A Preferred Stock.

     5. CONVERSION.

     The holders of Series A Preferred Stock shall have the following conversion rights:

     a)     Subject to Section 6, each share of Series A Preferred Stock shall be convertible, at any
time at the option of the holder thereof and without payment of any additional consideration, into
validly issued, fully paid and nonassessable shares of Common Stock of the Corporation and such
other securities and property, as hereinafter provided.

     b)     The Series A Preferred Stock shall be convertible into such number of fully paid and
non-assessable shares of Common Stock as is determined by dividing the Stated Value by the
Conversion Price (as defined below) then in effect, and then multiplying such quotient by each
share of Series A Preferred Stock to be converted. The conversion price at which shares of Common
Stock shall be issuable upon conversion of the Series A Preferred Stock shall initially be $10 per
share, subject to appropriate adjustment from time to time, as provided in this Section 5 (the
“Conversion Price”).

     c)     Each holder of Series A Preferred Stock that desires to convert its shares of Series A
Preferred Stock into shares of Common Stock pursuant to Section 5(b) shall surrender the
certificate or certificates therefor, duly endorsed, at the office of the Corporation or of any
transfer agent for the Series A Preferred Stock (the “Transfer Agent”), and shall give written
notice to the Corporation at such office that such holder elects to convert the same and

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shall state therein the number of shares of Series A Preferred Stock being converted.
Thereupon the Corporation shall promptly issue and deliver to such holder a certificate or
certificates for the number of shares of Common Stock to which such holder is entitled, together
with a cash adjustment of any fraction of a share as hereinafter provided. Such conversion shall
be deemed to have been made immediately prior to the close of business on the date of such
surrender of the certificate or certificates representing the shares of Series A Preferred Stock to
be converted, and the person or entity entitled to receive the shares of Common Stock issuable upon
such conversion shall be treated for all purposes as the record holder of such shares of Common
Stock on such date.

     d)     Adjustment of Conversion Price.

          i)     Subject in all events to Section 3 hereof, in case of any stock dividend, split,
combination, reclassification, capital reorganization or similar change of outstanding shares of
Common Stock, or in case of any consolidation or merger of the Corporation with or into another
entity (other than a consolidation or merger in which the Corporation is the continuing entity and
which does not result in any reclassification, capital reorganization or other change of
outstanding shares of Common Stock), or in case of any sale or conveyance to another entity of the
property of the Corporation as, or substantially as, an entirety (other than a sale/leaseback,
mortgage or other financing transaction or a liquidation that is otherwise covered by Section 3),
the Corporation shall cause effective provision to be made, through adjustment of the Conversion
Price or otherwise, so that each holder of a share of Series A Preferred Stock shall be entitled to
receive, upon conversion of such share of Series A Preferred Stock, the kind and number of shares
of stock or other securities or property (including cash) receivable upon such reclassification,
capital reorganization or other change, consolidation, merger, sale or conveyance by a holder of
the number of shares of Common Stock into which such share of Series A Preferred Stock was
convertible immediately prior to such reclassification, capital reorganization or other change,
consolidation, merger, sale or conveyance. Any such provision shall include provision for
adjustments that shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Section 5. The Corporation shall not effect any such consolidation, merger or sale
unless prior to or simultaneously with the consummation thereof the successor (if other than the
Corporation) resulting from such consolidation or merger or the entity purchasing assets or other
appropriate entity shall assume, by written instrument executed and delivered to the transfer agent
for the Series A Preferred Stock (the “Transfer Agent”), the obligation to deliver to the holder of
each share of Series A Preferred Stock such shares of stock, securities or assets as, in accordance
with the foregoing provisions, such holders may be entitled to receive and the other obligations
under these designations. The foregoing provisions shall similarly apply to successive
reclassifications, capital reorganizations and similar changes of outstanding shares of Common
Stock and to successive consolidations, mergers, sales or conveyances.

          ii)     After each adjustment of the Conversion Price pursuant to this Section 5(d), the
Corporation will promptly prepare a certificate signed by the Chairman or President, and by the
Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary, of the Corporation
setting forth the Conversion Price as so adjusted and a brief statement of the facts accounting for
such adjustment. The Corporation will promptly file such certificate with the Transfer Agent, if
any, and cause a brief summary thereof to be sent by

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ordinary first class mail to each registered holder of Series A Preferred Stock at his or her
last address as it shall appear on the registry books of the Corporation or the Transfer Agent (as
applicable). No failure to mail such notice nor any defect therein or in the mailing thereof shall
affect the validity of such adjustment. The affidavit of an officer of the Transfer Agent or the
Secretary or an Assistant Secretary of the Corporation that such notice has been mailed shall, in
the absence of fraud, be prima facie evidence of the facts stated therein. The Transfer Agent may
rely on the information in the certificate as true and correct and has no duty or obligation to
independently verify the amounts or calculations set forth therein.

     e)     The Corporation shall at all times reserve and keep available out of its authorized but
unissued shares of Common Stock, solely for the purpose of effecting the conversion of the shares
of the Series A Preferred Stock, such number of its shares of Common Stock as shall from time to
time be sufficient to effect the conversion of all outstanding shares of the Series A Preferred
Stock. The Corporation shall, in accordance with the laws of the State of Delaware, increase the
authorized number of shares of Common Stock if at any time the number of shares of authorized,
unissued and unreserved Common Stock shall not be sufficient to permit the conversion of all the
then-outstanding shares of Series A Preferred Stock.

     f)     The Corporation will pay all taxes (other than taxes based upon income) and other
governmental charges that may be imposed with respect to the issuance or delivery of shares of
Common Stock upon conversion of shares of Series A Preferred Stock, including, without limitation,
any tax or other charge imposed in connection with any transfer involved in the issue and delivery
of shares of Common Stock in a name other than that in which the shares of Series A Preferred Stock
so converted were registered.

     6. Mandatory Redemption.

     (a)     On the fifth anniversary (the “Mandatory Redemption Date”) of the date on which the shares
of Series A Preferred Stock are issued (the “Issue Date”), the Corporation shall redeem the shares
of then outstanding Series A Preferred Stock at a price per share in cash out of legally available
funds equal to the Stated Value (the “Redemption Price”) plus any accrued but unpaid dividends
thereon (whether or not declared) through the date of such redemption. The Corporation must
deliver written notice to the holders of Series A Preferred Stock at least fifteen (15) days prior
to the Mandatory Redemption Date and make payment on the Mandatory Redemption Date or if the
Mandatory Redemption Date is a legal holiday, the next following day that is not a legal holiday.
Upon receipt of payment of the Redemption Price, each holder of Series A Preferred Stock will
deliver the original certificate(s) evidencing the Series A Preferred Stock so redeemed to the
Corporation, unless such holder is awaiting receipt of a new certificate evidencing such shares
from the Corporation pursuant to another provision hereof.

     (b)     Notice of any redemption of the Series A Preferred Stock required to be given by the
Corporation shall be mailed by means of certified mail (return receipt requested), postage paid,
addressed to the holders of record of the Series A Preferred Stock, at their respective addresses
then appearing on the books of the Corporation and last known address (if different), or sent by
facsimile. Each such notice shall be deemed received by the holder of record upon deposit with the
United States Postal Service or by facsimile to the holder at the last

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fax number supplied by the holder to the Corporation. Each notice of redemption by the
Corporation shall specify (i) the Redemption Date, (ii) the Redemption Price, (iii) the place for
payment and for delivering the stock certificate(s) and transfer instrument(s) in order to collect
the Redemption Price (which shall be at a reasonable location in the United States), and (iv) the
last time at which the shares of Series A Preferred Stock being called for redemption can be
converted in accordance with the terms hereof and the last sentence of this paragraph, which shall
be no later than the close of business on the fourth business day preceding the Redemption Date.
Failure by the Corporation to give the notice described in this paragraph, or the formal
insufficiency of any such notice, shall not prejudice the rights of any holders of Series A
Preferred Stock to cause the Corporation to redeem any such shares held by such holder, or the
rights of the Corporation to redeem such shares, provided the holder receives the Redemption Price
on the Mandatory Redemption Date. At any time on or prior to the close of business of the fourth
business day preceding the Mandatory Redemption Date, the holders of Series A Preferred Stock may
convert any or all of the shares of Series A Preferred Stock, and the Corporation shall honor any
such conversions in accordance with the terms hereof. After such time, the Corporation may, but is
not required to, honor such request for conversion.

     (c)     Provided the Redemption Price of a share of Series A Preferred Stock has been paid or
properly provided for, at the close of business on the Mandatory Redemption Date for the share of
Series A Preferred Stock, such share shall be deemed to cease to be outstanding and all rights of
any person other than the Corporation in such share shall be extinguished on the Redemption Date
(including all rights to vote or consent or to receive future dividends with respect to such share)
except for the right to receive the Redemption Price, without interest, for the share in accordance
with the provisions of this Section, subject to applicable escheat laws.

     (d)     Notwithstanding the redemption rights granted to the holders of Series A Preferred Stock,
the Corporation shall be required to redeem shares of Series A Preferred Stock only if (i) after
giving effect to the redemption, the Corporation would not be insolvent, (ii) the net assets of the
Corporation are not less than the amount of the proposed redemption and (iii) funds are otherwise
legally available therefor under Delaware law, as from time to time amended. Without limiting the
generality of any provision hereof or of any applicable law, failure to redeem the Series A
Preferred Stock in accordance with this Section 6(d) shall result (until the date the redemption is
made by the Corporation in compliance with this Section 6(d)) in dividends continuing to accrue and
accumulate on such shares and shall result in the holders of such shares having the right to vote
such shares as otherwise permitted herein (and all other rights and obligations shall continue with
respect to such shares as set forth herein), but shall not result in the Redemption Price of such
shares being deemed to be a debt of the Corporation.

     (e)     In the event that the total amount of funds legally available for redemption of Series A
Preferred Stock is insufficient to redeem the Series A Preferred Stock that are the subject of a
notice of redemption, then the Series A Preferred Stock shall be redeemed ratably based on the
aggregate redemption amount payable with respect to the shares of Series A Preferred Stock then
redeemable.

     (f)     Nothing herein contained shall prevent or restrict the purchase by the Corporation, from
time to time either at public or private sale, of the whole or any part of the Series A Preferred
Stock at such price or prices as the Corporation may determine, subject to the

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provisions of applicable law. Shares of Series A Preferred Stock received upon purchase,
conversion or otherwise acquired by the Corporation will be restored to the status of authorized
but unissued shares of Preferred Stock, without designation as to class, and may thereafter be
issued, but not as shares of Series A Preferred Stock.

     7. NO PREEMPTIVE RIGHTS OR SINKING FUND. The shares of Series A Preferred Stock shall
have no preemptive or subscription rights, except those that may be provided by contract. No
sinking fund shall be established for the Series A Preferred Stock.

     8. SEVERABILITY OF PROVISIONS. Whenever possible, each provision hereof shall be
interpreted in a manner as to be effective and valid under applicable law, but if any provision
hereof is held to be prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without invalidating or otherwise
adversely affecting the remaining provisions hereof.

     9. AMENDMENTS. No provision of these terms of the Series A Preferred Stock may be
amended, modified or waived without the written consent or affirmative vote of the holders of at
least a majority of the then outstanding shares of Series A Preferred Stock, voting together as a
separate class.

     IN WITNESS WHEREOF, Carriage Services, Inc. has caused this Certificate of Designations to be
duly executed by an authorized officer this      day of                  , 2008.

	 	 	 	 	 	 	 
	 	 	Carriage Services, Inc.
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 

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Exhibit 10.1

2008 Administrative Guidelines for the

Copano Energy, L.L.C.

Management Incentive Compensation Plan

The Copano Energy, L.L.C. Management Incentive Compensation Plan (the “Plan”) is established by the
Board of Directors of Copano Energy, L.L.C. (the “Company”) to encourage and reward significant
contributions to the successful and profitable operation of the enterprise by (i) management
employees of the Company or a subsidiary thereof or (ii) employees of an Affiliate who perform
services in a management capacity on behalf of the Company or a subsidiary thereof. The
Compensation Committee of the Board, which oversees executive compensation matters on behalf of the
Board, approves the Administrative Guidelines for the Plan each Plan Year. Terms capitalized in
these Administrative Guidelines but not defined herein shall have the meaning attributed to such
terms in the Plan.

Participation

Participants eligible for the Plan effective January 1, 2008 for the 2008 Plan Year shall be those
employees of the Company and its Affiliates named in Exhibit A to these Guidelines. Upon the
recommendation of the CEO, the Committee may approve the entry of additional Participants in the
Plan effective on the first day of any month of the Plan Year following their promotion or
employment date. Participants who enter the Plan during the Plan Year shall be eligible for an
Award under the Plan but, in the discretion of the CEO and Committee Chairman, may only be eligible
for an Award calculated pro rata based upon the period of actual service during the Plan Year.

Bonus Opportunities

The 2008 Target Bonus level for each proposed Participant is set forth in Exhibit A. The Target
Bonus is defined as a specific percentage of the Participant’s base salary as of July 1 of the Plan
Year that may be earned if, in the opinion of the Committee, the objectives upon which the
opportunity is contingent are fully achieved.

Each Participant’s 2008 bonus is contingent upon 1) the Financial Objective(s) specified in Exhibit
B to these Guidelines, and 2) the Participant’s Personal Objectives, as established in accordance
with these Guidelines. The CEO and the Committee shall assess the relative significance of the
Financial Objective(s) and each Participant’s Personal Objectives and shall assign to each
objective a percentage so that for each Participant, the percentages assigned to the Financial
Objective(s) shall equal seventy- five percent (75%) of the Target Bonus and the percentages
assigned to the Personal Objectives shall equal twenty-five percent (25%) of the Target Bonus.

 

 

Financial Objective(s)

For each Financial Objective, the Committee and the CEO shall approve the following performance
levels: 1) a Threshold Level, 2) a Target Level, and 3) a Maximum Level, which levels shall be
subject to final approval by the Board.

	 	A.	 	If performance is less than the Threshold Level, the amount of the Target Bonus
contingent upon that objective will not be paid.
	 
	 	B.	 	If performance is equal to the Threshold Level, fifty percent (50%) of the amount of
the Target Bonus contingent upon that objective will be paid.
	 
	 	C.	 	If performance equals the Target Level, one hundred percent (100%) of amount of the
Target Bonus contingent upon that objective will be paid.
	 
	 	D.	 	If performance equals or exceeds the Maximum Level, one hundred and fifty percent
(150%) of the amount of the Target Bonus contingent upon that objective will be paid.
	 
	 	E.	 	When performance falls between the Threshold Level and the Target Level or between
the Target Level and the Maximum Level, the amount of the bonus shall be determined by
straight-line interpolation.
	 
	 	F.	 	In no circumstances will any bonus be paid from this Plan if the per unit cash
distribution paid to unitholders of the Company in regard to any quarter of the Plan Year
is less than the Minimum Quarterly Distribution set forth in the Company’s Third Amended
and Restated Limited Liability Company Agreement, as amended from time to time.

When the Committee and the CEO deem it appropriate but subject to Board approval, the Threshold
Level, Target Level, and Maximum Level of any Financial Objective approved at the beginning of the
Plan Year may be adjusted to reflect significant changes in the operational environment or in the
strategic direction of the Company or such other factors as the Committee and the CEO may
determine.

Personal Objectives

Prior to or immediately following the commencement of any Plan Year, the CEO may require that each
Participant (and the Committee may require that the CEO) propose such Personal Objectives that will
determine the extent to which the percentage of the Target Bonus contingent upon Personal
Objectives has been earned by such Participant. To the extent practical, the Personal Objectives
will be specific, measurable, and represent the contributions required of the Participant if the
Company is to meet or achieve its business plan. Personal Objectives for Participants who are
officers of the Company and heads of operating subsidiaries shall be approved by the CEO and the
Committee. Personal Objectives for non-officer Participants shall be approved by the CEO and, at
the option of the Committee, are subject to its review. During the Plan Year, Personal Objectives
will

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be reviewed routinely and may be revised by the Committee and the CEO to reflect changes in job
responsibilities or business objectives.

At the end of the Plan Year, the degree to which each Participant accomplished his or her Personal
Objectives will be reviewed by the CEO (or, in the case of the CEO, by the Committee), and a score
of 0% to 150% will be assigned based upon the CEO’s subjective opinion of the performance of the
Participant with respect to the Personal Objectives and upon other factors that the CEO may deem
relevant and appropriate. The percentage that represents the Participant’s score on Personal
Objectives shall be multiplied by the weight assigned to the Personal Objective component of the
Target Bonus to determine the amount of the bonus earned through the Personal Objectives component
of the opportunity.

Bonus Determinations

The Participant’s Financial Objective(s) result will be combined with the Participant’s Personal
Objectives result to determine the amount of his or her Award. The CEO’s recommendations for award
payments will be presented to the Committee at its first meeting immediately following the end of
the applicable Plan Year, at which time the Committee shall review performance and consider and
approve bonuses, if any, for all Participants, including the CEO. Awards shall be paid as soon as
reasonably practicable following the Committee’s approval of awards, but in no case shall awards be
paid later than March 15.

Participant’s Termination

Participants who terminate their employment by reason of death, disability (as determined by the
Committee in its sole discretion) or retirement on or after reaching age 65 or, if prior to age 65,
if approved by the Committee, and Participants whose employment with the Company or an Affiliate is
terminated without “cause” shall be eligible for an award based on a pro rata portion of their
Target Bonus and payable at the same time as all other award payments for the applicable Plan Year.
The pro rata portion of such Target Bonus shall be equal to the amount of the Participant’s Target
Bonus multiplied by a fraction, the numerator of which is the number of full weeks the participant
was actively employed during the Plan Year and the denominator of which is 52.

Notwithstanding anything to the contrary herein, in the event of (i) the termination of a
Participant’s employment by the Company or an Affiliate without “cause” or (ii) the termination of
employment by the Participant for Good Reason, in either case within one year of a Change of
Control, such Participant shall be entitled to a pro rata portion of his or her Target Award based
upon the termination date and payable within 30 days following termination.

If a Participant’s employment terminates for any other reason, he or she will not be entitled to
any portion of a Target Award. Participants who voluntarily terminate employment or are terminated
for “cause” before the payment date of awards earned in a prior Plan Year shall forfeit such
Awards.

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Conflicts

Any conflicts between the Plan and these Administrative Guidelines shall be resolved in favor of
the Plan. Notwithstanding the preceding sentence, it is the intention
of the Board and the Committee that the Plan shall be construed broadly to accommodate the provisions and
concepts embodied in these Administrative Guidelines to the extent reasonably possible.

4

 

Exhibit A

Copano Energy, L.L.C.

2008 Management Incentive Compensation Plan

List of Participants and Target Awards (1)

	 	 	 	 	 	 	 
	Participant	 	Position	 	%	 
	Officers	 	 
	 	 	 	 
	Assiff, Matthew J.	 	Senior Vice President and Chief Financial Officer
	 	 	50	%
	Bopp, Ronald W.	 	Senior Vice President, Corporate Development
	 	 	50	%
	Eckel, Jr., John R.	 	Chairman of the Board and Chief Executive Officer
	 	 	65	%
	Northcutt, R. Bruce	 	President and Chief Operating Officer
	 	 	55	%
	Raber, John A.	 	Executive
Vice President; President and Chief Operating Officer, Rocky Mountains
	 	 	50	%

 

			
	(1)	 	Only includes named executive officer participants

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Exhibit B

Copano Energy, L.L.C.

2008 Management Incentive Compensation Plan

Financial Objective(s)

     The financial objective(s) approved by the Board of Directors

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