Document:

exv10w39

EXHIBIT
10.39

RESTRICTED STOCK AWARD AGREEMENT

THERMADYNE HOLDINGS CORPORATION

2004 STOCK INCENTIVE PLAN

     THIS RESTRICTED STOCK AWARD AGREEMENT (this “Agreement”) dated May 1, 2007, between Thermadyne
Holdings Corporation (the “Company”), a Delaware
corporation, and                                          (the
“Grantee”), an officer or key employee of the Company or one of its subsidiary corporations
(“Subsidiary Corporation”) within the meaning of Section 424(f) of the Code.

     RECITALS:

     WHEREAS, the Committee or the Board of Directors of the Company (“Board”) acting as the
Committee (in either case, the “Committee”) has determined that the Grantee is one of the key
personnel (officer, director, or key employee) of the Company or one of its Subsidiary
Corporations, and

     WHEREAS, the Committee believes the goals and objectives of the Company’s 2004 Stock Incentive
Plan (the “Plan”) will be furthered by granting to the Grantee shares of Common Stock (“Restricted
Stock”) pursuant to the Plan.

     NOW, THEREFORE, in consideration of the foregoing and of the mutual undertakings set forth in
this Plan Agreement, the Company and the Grantee agree as follows:

Section 1. Terms of Plan to Control

     This Agreement is subject to all the terms and conditions of the Plan, a copy of which is
attached hereto as Exhibit A. Capitalized terms used in this Agreement and not otherwise
defined in the Agreement are defined in the Plan. In the event of a conflict between the Plan and
this Agreement, the terms of the Plan shall control.

Section 2. Grant of Restricted Stock

     2.1
The Company hereby grants to the Grantee                      shares of Restricted Stock.

     2.2 Subject to the provisions of this Agreement, the Company shall issue and register on its
books and records in the name of the Grantee a certificate(s) in the amount of the shares of
Restricted Stock subject to this Agreement as set forth above. Each certificate shall bear a
legend, substantially in the following form:

“The sale or other transfer of the shares of stock represented by this certificate, whether
voluntary, involuntary or by operation of law, is subject to certain restrictions on transfer as
set forth in the Thermadyne Holdings Corporation 2004 Stock Incentive Plan and in the associated
Agreement. A copy of this Plan and such Agreement may be obtained from Thermadyne Holdings
Corporation.”

 

 

The certificate(s) shall be retained by the Company (or its designee) until the time that all
restrictions or conditions applicable to the shares of Restricted Stock have been satisfied or
lapsed. The Grantee agrees to (i) deliver to the Company, as a precondition to the issuance of any
certificate(s) with respect to Unvested Shares, one or more stock powers, endorsed in blank, with
respect to such shares, (ii) sign such other powers, take such other actions as the Company may
reasonably request to accomplish the transfer or forfeiture of any Unvested Shares that are
forfeited under this Agreement, and (ii) authorize the Company to cause such Unvested Shares to be
cancelled or transferred in the event they are forfeited pursuant to this Agreement. “Unvested
Shares” means shares of Common Stock which are subject to forfeiture under this Agreement. If
Unvested Shares are held in book entry form, certificate(s) shall not be issued under this Section
and the Grantee agrees that the Company may give stop transfer instructions to the depository of
such shares of Restricted Stock to ensure compliance with the provisions of this Agreement. The
Grantee hereby (i) acknowledges that the Unvested Shares may be held in book entry form on the
books of the Company’s depository (or another institution specified by the Company), (ii)
irrevocably authorizes the Company to take such actions as may be necessary or appropriate to
effect a transfer or cancellation of the record ownership of such Unvested Shares that are
forfeited, (iii) agrees to sign such powers and take such other actions as the Company may
reasonably request to accomplish the forfeiture of any Unvested Shares that are forfeited under
this Agreement, and (iv) authorizes the Company to cause such shares of Common Stock to be
cancelled or transferred in the event they are forfeited pursuant to this Agreement.

Section 3. Restrictions

     3.1 In association with the other terms this Agreement or contained in the Plan, the shares of
Restricted Stock shall be subject to the following restrictions:

	 	a.	 	Neither (i) the shares of Restricted Stock or any interest in
them, (ii) the right to vote such shares, (iii) the right to receive dividends
on such shares, or (iv) any other rights under this Agreement may be sold,
transferred, donated, exchanged, pledged, hypothecated, assigned or otherwise
transferred, alienated or encumbered, by operation of law or otherwise, until
(and then only to the extent of) such shares are delivered to the Grantee or,
in the event of Grantee’s death, the Grantee’s testamentary transferee or
transferees.
	 
	 	b.	 	The Grantee shall have, with respect to the shares of
Restricted Stock, all of the rights of a holder of such shares, including the
right to vote such shares and to receive any cash dividends thereon.
Additional shares of Company common stock resulting from adjustments under
section 12 of the Plan with respect to shares of Restricted Stock subject to
this Agreement shall be treated as additional shares of Restricted Stock
subject to the same restrictions and other terms of this Agreement and the
Grantee or, in the event of his or her death, his or her Designated Beneficiary
or Beneficiaries or testamentary transferees, shall comply with the provisions
of Sections 2.5 of this Agreement with respect to such additional shares. Cash
dividends paid on Unvested Shares are taxable to the Grantee as compensation
income, and not dividend income, and are deductible by the

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	 	 	 	Company or a Subsidiary Corporation for income tax purposes as compensation
income.
	 
	 	c.	 	During the Grantee’s lifetime, shares of Restricted Stock shall
only be delivered to him or her. Any such shares transferred in accordance
with this Agreement shall continue to be subject to the terms and conditions of
this Agreement. Any transfer permitted under this Agreement shall be promptly
reported in writing to the Company’s Secretary.

     3.2 The amount of the shares of Restricted Stock that are delivered to Grantee will be based
on Average ROIOC (as herein defined) over a three year period, beginning in January 2007 and ending
in December 2009 (the “Target Period”) as set forth below. Subject to applicable securities laws
and the terms of Section 4, shares of Restricted Stock shall be delivered to the Grantee, or in the
event of the Grantee’s death, his or her testamentary transferee, as follows:

	 	a.	 	If Average ROIOC for the Target Period is 35 percent or more,
100 percent of the shares of Restricted Stock shall be delivered.
	 
	 	b.	 	If Average ROIOC for the Target Period is 30 percent, 67
percent of the shares of Restricted Stock shall be delivered.
	 
	 	c.	 	If Average ROIOC for the Target Period is 25 percent, 33
percent of the shares of Restricted Stock shall be delivered.
	 
	 	d.	 	If Average ROIOC during the Target Period does not reach 25
percent, none of the shares of Restricted Stock shall be delivered, and the
grant of such shares shall be forfeited and no longer exercisable.

     The parties agree and acknowledge that incremental amounts of the shares of Restricted Stock
will be delivered for Average ROIOC between 25 percent and 30 percent and between 30 percent and 35
percent. For example, if Average ROIOC is 28 percent, 53% percent of the shares of Restricted
Stock will be delivered.

     3.3 The following terms shall have the following meaning when used herein:

	 	a.	 	“Average ROIOC” means the weighted average ROIOC for the three
fiscal years of the Company ending December 31, 2007, 2008 and 2009.
	 
	 	b.	 	“ROIOC” for a fiscal year of the Company means Adjusted
Operating EBITDA for such year divided by Invested Operating Capital for such
year.
	 
	 	c.	 	“Invested Operating Capital” for a fiscal year of the Company
is the sum of the following items from the consolidated year end balance sheet
as shown on the Company’s audited financial statement for such year:

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	 	 	 	Accounts receivables, less allowances for doubtful accounts

Inventories

Net property, plant and equipment

Patents and trademarks included in intangibles

Other assets

Long term receivables

Less accounts payable
	 
	 	d.	 	“Adjusted Operating EBITDA” for a fiscal year of the Company is
the sum of the following items from the consolidated year end statements of
operations as shown on the Company’s audited financial statement for such year:
	 
	 	 	 	Net income (loss) from continuing operations

Interest expense

Net periodic postretirement benefits in excess of cash payments

Restructuring costs

LIFO

Minority interest

Severance accrual

Stock compensation expense

Provision for income tax

     3.4 The award percentages are based on projections for the Target Period which were made by
the Company and are set forth in the 2007 Business Plan, a copy of which projections are attached
hereto and incorporated herein as Exhibit A. Said projections are based on the continued
operation of the Company and its Subsidiary Corporations in their current ordinary course during
the Target Period. The parties agree and acknowledge that Invested Operating Capital and Adjusted
Operating EBITDA may be recast by the Company to adjust for any unforeseen extraordinary
circumstances that may occur during the Target Period, including, but not limited to, a change in
accounting methods, the discontinued operations of a Subsidiary Corporation or a division, or the
sale or acquisition of a business or brand.

     3.5 Notwithstanding anything in this Agreement to the contrary, all restrictions, except those
under Section 5, on shares of Restricted Stock granted under this Agreement shall lapse on a change
of control and certificate(s) or other evidence of ownership of such shares shall be delivered to
the Grantee or, in the event of his or her death, to his or her Designated Beneficiary or
Beneficiaries or testamentary transferees. “Change in control” means a change in the ownership or
effective control of the Company or a change in a substantial portion of the assets of the Company
within the meaning of Section 409A(2)(A)(v) of the Code. The Grantee may designate a beneficiary
or beneficiaries (“Designated Beneficiary or Beneficiaries”) on the Designated Beneficiary form
attached to this Agreement to receive Restricted Stock under this Agreement upon the Grantee’s
death. If the Grantee does not complete the Beneficiary Designation form, or the Designated
Beneficiary or Beneficiaries has or have predeceased the Grantee or cannot be located, the shares
of Restricted Stock shall be transferred in accordance with the Grantee’s will or, if the Grantee
has no will, in accordance with the applicable state laws or descent and distribution. Any person
or entity acquiring Restricted Stock after the Grantee’s

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death shall be bound by all the terms and conditions of the Plan and this Agreement which
would have applied to such shares if the Grantee had lived including, without limitation, the
provisions of Section 5.

Section 4. Termination of Employment

     4.1 Except to the extent otherwise provided in Section 4.2 or 4.3, all shares of Restricted
Stock, to the extent not previously forfeited or vested, shall be forfeited on the Grantee’s
termination of employment with the Company or a Subsidiary Corporation.

     4.2 If the Grantee’s employment terminates with the Company or a Subsidiary Corporation other
than by reason of death, dismissal for cause (as defined herein) or resignation from employment
without the Company’s prior consent, shares of Restricted Stock shall be transferred to the Grantee
at the time and in the manner as described in Section 3.3.

     4.3 If the Grantee dies while in the employ of the Company or a Subsidiary Corporation, or
dies after his or her employment terminates but prior to the time the shares of Restricted Stock
are to be transferred to him or her under Section 4.2, shares of Restricted Stock shall be
transferred to his or her testamentary transferee at the time and in the manner described in
Section 3.3. Any person or entity acquiring Restricted Stock after the Grantee’s death shall be
bound by all the terms and conditions of the Plan and this Agreement which would have applied such
shares had the Grantee lived including, without limitation, the provisions of Section 5.

     4.4 References herein to an individual’s employment shall include any and all periods during
which such individual is considered an employee of the Company or a Subsidiary Corporation. The
Grantee shall be deemed to have terminated employment when the Grantee completely ceases to be
employed (within the meaning of the preceding sentence) by the Company and all of its Subsidiary
Corporations. The Committee may in its discretion determine (a) whether any leave of absence
constitutes a termination of employment within the meaning of this Plan Agreement, and (b) the
impact, if any, of any such leave of absence on the shares of Restricted Stock granted under this
Agreement.

     4.5 The term “dismissal for cause” as used herein shall mean:

	 	a.	 	an act or omission, by the Grantee that causes material harm to
the Company or a Subsidiary Corporation of which the Grantee is notified in
writing by the Company and the Grantee has not corrected within ten (10) days
of such notification;
	 
	 	b.	 	any continued neglect of or a failure to perform duties by the
Grantee of which the Grantee is notified in writing by the Company and the
Grantee has not corrected within ten (10) days of such notification;
	 
	 	c.	 	the Grantee’s performing services for any other corporation or
person which competes with the Company or a Subsidiary Corporation while he or
she is employed by the Company or a Subsidiary Corporation and without the
written approval of the chief executive officer of the Company; or

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	 	d.	 	any conviction of the Grantee or plea of guilty (or of nolo
contendere) by the Grantee to a felonious crime;

provided, however, that if, at the time in question the Grantee is a party to an employment
agreement with the Company or any of its Subsidiary Corporations which contains a definition of
“cause” which is inconsistent with the provisions of this Section 4.5, the terms of such employment
agreement shall define “dismissal for cause” for the purposes of this Agreement.

			
	Section 5.	 	Securities Law Restrictions and Other Restrictions on Transfer of Shares of
Restricted Stock Pursuant to this Agreement

	 	a.	 	The Grantee represents that upon receipt of shares of
Restricted Stock, such shares shall be for the Grantee’s own account and not on
behalf of others. Federal and state securities laws govern and restrict the
Grantee’s right to offer, sell or otherwise dispose of any such shares unless
the shares are first registered under the Securities Act of 1933 (the
“Securities Act”) and state securities laws (which the Company is not required
to do), or in the opinion of the Company’s counsel, such offer, sale or other
disposition is exempt from registration or qualification thereunder. The
Grantee shall not offer, sell or otherwise dispose of any shares purchased
pursuant to this Agreement in any manner unless they are first registered under
the Securities Act and any applicable state securities laws except in a
transaction which, in the opinion of counsel to the Company, is exempt from the
registration requirements.
	 
	 	b.	 	Restrictive Legend. The certificates representing the
shares of Common Stock granted pursuant to this Agreement shall bear the
following legend, plus other legends the Company deems necessary or desirable
in connection with securities laws or other rules, regulations or laws.
	 
	 	 	 	THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) AND ARE “RESTRICTED SECURITIES”
AS DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE
SOLD, OFFERED FOR SALE OR OTHERWISE DISTRIBUTED EXCEPT (i) IN CONJUNCTION
WITH AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE ACT,
OR (ii) IN COMPLIANCE WITH RULE 144, OR (iii) PURSUANT TO AN OPINION OF
COUNSEL TO THE CORPORATION THAT SUCH REGISTRATION OR COMPLIANCE IS NOT
REQUIRED AS TO SAID SALE, OFFER OR DISTRIBUTION.

Section 6. Non-Assignability

     No right granted to the Grantee under the Plan or this Agreement, except as otherwise provided
in this Agreement, shall be assignable or transferable (whether by operation of law or

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otherwise and whether voluntarily or involuntarily), other than by will or by the laws of
descent and distribution. During the life of the Grantee, all rights granted to the Grantee under
the Plan or under this Agreement shall inure only by the Grantee.

Section 7. Withholding Taxes

     Whenever under the Plan and this Agreement shares of Common Stock are to be delivered, the
Company shall be entitled to require as a condition of delivery that the Grantee remit an amount
sufficient to satisfy all federal, state and other governmental withholding tax requirements
related thereto; provided, that in lieu of or in addition to the foregoing, the Company shall have
the right to withhold such sums from compensation or other amounts otherwise due to the Grantee.

Section 8. Requirement of Notification on Section 83(b) Election

     If the Grantee shall, in connection with the receipt of Restricted Stock, make the election
permitted under Section 83(b) of the Code (i.e., an election to include in his or her gross income
in the year of transfer the amounts specified in section 83(b) of the Code), he or she shall notify
the Company of such election within ten days of filing notice of the election with the Internal
Revenue Service, in addition to any filing and notification required pursuant to regulations issued
under the authority of Section 83(b) of the Code.

Section 9. Adjustments Upon Changes in Capitalization

     In the event of any increase or decrease, after the date of this Agreement, in the number of
issued shares of Common Stock resulting from the subdivision or combination of shares of Common
Stock or other capital adjustments, or the payment of a stock dividend, or other increase or
decrease in such shares effected without receipt of consideration by the Company, the Committee
shall proportionately adjust the number of shares of Restricted Stock and any and all other matters
deemed appropriate by the Committee; provided, however, that any fractional shares resulting from
any such adjustment shall be eliminated. Adjustments under this Section shall be made by the
Committee, whose determination as to what adjustments shall be made, and the extent thereof, shall
be final, binding and conclusive.

Section 10. Right of Discharged Reserved

     Nothing in the Plan or in this Agreement shall confer upon the Grantee the right to continue
in the employment, or service of the Company or any of its Subsidiary Corporations, or affect any
right which the Company or any of its Subsidiary Corporations may have to terminate the employment
or service of the Grantee. The parties agree and acknowledge that the Grantee is an at-will
employee of the Company or Subsidiary Corporation. The Company and the Grantee retain the right to
terminate such employment relationship at any time.

Section 11. Nature of Payments

     11.1 Any and all grants of shares of Restricted Stock hereunder shall be in consideration of
services performed by the Grantee for the Company or for its Subsidiary Corporations.

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     11.2 Any and all issuances of shares of Restricted Stock hereunder shall constitute a special
incentive payment to the Grantee. Such issuances and/or income realized upon the grant of shares of
Restricted Stock shall not be taken into account in computing the amount of salary or compensation
of the Grantee for the purposes of determining any pension, retirement, death or other benefits
under (a) any 401(k), pension, retirement, profit-sharing, bonus, life insurance, disability or
other benefit plan of the Company or any Subsidiary Corporation or (b) any agreement between the
Company or any Subsidiary Corporation, on the one hand, and the Grantee, on the other hand, except
as such plan or agreement shall otherwise expressly provide.

Section 12. Committee Determinations

     The Committee’s determinations under the Plan and this Agreement need not be uniform and may
be made by it selectively among persons who receive, or are eligible to receive, awards under the
Plan (whether or not such persons are similarly situated). All decisions, interpretations and
determinations by the Committee with regard to any question or matter arising hereunder or under
the Plan shall be conclusive and binding upon the Company and the Grantee and his or her
transferees.

Section 13. Section Headings

     The Section headings contained herein are for the purpose of convenience only and are not
intended to define or limit the contents of said sections.

Section 14. Notices

     Any notice to be given to the Company or the Committee hereunder shall be in writing and shall
be addressed to the Secretary of the Company at Thermadyne Holdings Corporation, 16052 Swingley
Ridge Court, Suite 300, Chesterfield, MO 63017, or at such other address as the Company may
hereafter designate to the Grantee by notice as provided herein. Any notice to be given to the
Grantee hereunder shall be addressed to the Grantee at the address set forth beneath his signature
hereto, or at such other address as the Grantee may hereafter designate to the Company by notice as
provided herein. Notices hereunder shall be deemed to have been duly given when personally
delivered or mailed by registered or certified mail to the party entitled to receive the same.

Section 15. Successors and Assigns

     This Agreement shall be binding upon and inure to the benefit of the parties hereto and the
successors and assigns of the Company and, to the extent set forth in Section 4.3, the heirs and
personal representatives of the Grantee.

Section 16. Other Payments or Awards

     Nothing contained in this Agreement shall be deemed in any way to limit or restrict the
Company or any Subsidiary Corporations from making any award or payment to the Grantee under any
other plan, arrangement or understanding, whether now existing or hereafter in effect.

8

 

Section 17. Governing Law and Venue

     This Agreement shall be governed by and construed in accordance with the laws of the state of
Missouri despite any laws of that state that would apply the laws of a different state. In the
event of litigation arising in connection with this Agreement and/or the Plan, the parties hereto
agree to submit to the jurisdiction of state and Federal courts located in the state of Missouri.

Section 18. Severability

     If any term or provision of this Agreement, or the application of this Agreement to any person
or circumstances, shall at any time or to any extent be invalid, illegal or unenforceable in any
respect as written, both parties intend for any court construing this Agreement to modify or limit
that provision so as to render it valid and enforceable to the fullest extent allowed by law. Any
provision that is not susceptible of reformation shall be ignored so as to not affect any other
term or provision of this Agreement, and the remainder of this Agreement, or the application of
that term or provision to persons or circumstances other than those as to which it is held invalid,
illegal or unenforceable, shall not be affected thereby and each term and provision of this
Agreement shall be valid and enforced to the fullest extent permitted by law.

Section 19. Entire Agreement Modification

     The Plan and this Agreement contain the entire agreement between the parties with respect to
the subject matter contained in this Agreement and may not be modified, except as provided in the
Plan, as it may be amended from time to time in the manner provided in the Plan, or in this
Agreement, as it may be amended from time to time by a written document signed by each of the
parties to this Agreement. Any oral or written agreements, representations, warranties, written
inducements or other communications with respect to the subject matter contained in this Agreement
made before the signing of this Agreement shall be void and ineffective for all purposes.

Section 20. Authority to Receive Payments

     Any amount payable to or for the benefit of a minor, an incompetent person or other person
incapable of receipting therefore shall be deemed paid when paid to the conservator of such
person’s estate or to the party providing or reasonably appearing to provide for the care of such
person, and such payment shall fully discharge the Company, members of the Committee and the Board
with respect thereto.

Section 21. Counterparts

     This Agreement may be executed simultaneously in two or more counterparts, each of which shall
constitute an original, but all of which taken together shall constitute one and the same
Agreement.

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     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date and year
first above written.

	 	 	 	 	 	 	 	 	 	 	 
	THERMADYNE HOLDINGS
CORPORATION	 	 	 	GRANTEE	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	Patricia S. Williams
	 	 	 	Grantee’s Name:	 	 	 	 
	 

	 	 	 	 	 	Date of Signature:
	 	 

	 	 
	 

	 	 	 	 	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Grantee’s Address:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 

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RESTRICTED STOCK AWARD AGREEMENT

THERMADYNE HOLDINGS CORPORATION

2004 STOCK INCENTIVE PLAN

BENEFICIARY DESIGNATION

To the Secretary of Thermadyne Holdings Corporation (“Company”)

I hereby designate the following person, persons or entity as primary and secondary Designated
Beneficiaries of rights that shall be transferred under the Thermadyne Holdings Corporation 2004
Stock Incentive Plan (the “Plan”) and the Thermadyne Holdings Corporation 2004 Stock Incentive Plan
Restricted Stock Agreement (“Agreement”) between the
Company and me dated                                         , 20                    
upon my death:

Primary Beneficiary [include address and relationship]:

Secondary Beneficiary [include address and relationship]:

I RESERVE THE RIGHT TO REVOKE OR CHANGE ANY BENEFICIARY DESIGNATION. I HEREBY REVOKE ALL PRIOR
DESIGNATIONS (IF ANY) OF BENEFICIARIES AND SECONDARY BENEFICIARIES.

The Company shall cause all shares of Restricted Stock to be transferred by reason of my death
pursuant to the Agreement to the Primary Beneficiary, if he, she or it survives me, and if no
Primary Designated Beneficiary shall survive me, then to my secondary Designated Beneficiary. If
no named Designated Beneficiary survives me, then all such shares shall be transferred in
accordance with the terms of the Agreement.

	 	 	 	 	 
	 

Date of this Designation

	 	 

Signature of Participant
	 	 

NOTE: Unless provided otherwise in this Beneficiary Designation, the Company shall transfer all
shares of Restricted Stock to be transferred to more than one Designated Beneficiary equally to the
living Designated Beneficiaries.

11exv10w40

EXHIBIT
10.40

NON-QUALIFIED STOCK OPTION AGREEMENT

THERMADYNE HOLDINGS CORPORATION

2004 STOCK INCENTIVE PLAN

     THIS NON-QUALIFIED STOCK OPTION PLAN AGREEMENT (this “Agreement”) dated May 1, 2007, between
Thermadyne Holdings Corporation (the “Company”), a Delaware corporation, and
                                        
(the “Optionee”), an officer or key employee of the Company or one of its
subsidiary corporations (“Subsidiary Corporation”) within the meaning of Section 424(f) of the
Code.

     RECITALS

     WHEREAS, the Committee or the Board of Directors of the Company (“Board”) acting as the
Committee (in either case, the “Committee”) has determined that the Optionee is one of the key
personnel (officer, director, or key employee) of the Company or one of its Subsidiary
Corporations; and

     WHEREAS, the Committee believes the goals and objectives of the Company’s 2004 Stock Incentive
Plan (the “Plan”) will be furthered by granting to the Optionee a right to purchase shares of
Common Stock pursuant to the Plan (the “Stock Option”).

     NOW, THEREFORE, in consideration of the foregoing and of the mutual undertakings set forth in
this Agreement, the Company and the Optionee agree as follows:

Section 1. Terms of Plan to Control

     This Agreement is subject to all the terms and conditions of the Plan, a copy of which is
attached hereto as Exhibit A. Capitalized terms used in this Agreement and not otherwise
defined in this Agreement are as defined in the Plan. In the event of a conflict between the Plan
and this Agreement, the terms of the Plan shall control.

Section 2. Grant of Option

     2.1 Subject to the terms and conditions set forth herein and in the plan, the Company hereby
grants to the Optionee a Stock Option to purchase
                     shares of Common Stock of the Company.
The per share exercise price will be the price at which a share of Company Stock closes on May 1,
2007.

     2.2 The Stock Option granted hereby is intended to be a Nonqualified Stock Option subject to
the provisions of Section 83 of the Code.

Section 3. Exercisability

     3.1 The Stock Option will vest based on Average ROIOC (as herein defined) over a three year
period, beginning in January 2007 and ending in December 2009 (the “Target Period”)

 

 

as set forth
below. Subject to applicable securities laws, the Stock Option granted pursuant to this Agreement
shall vest and be exercisable as of May 1, 2010 as follows:

	 	a.	 	If Average ROIOC for the Target Period is 35 percent or more,
100 percent of the Stock Option shall be vested and exercisable.
	 
	 	b.	 	If Average ROIOC for the Target Period is 30 percent, 67
percent of the Stock Option shall be vested and exercisable.
	 
	 	c.	 	If Average ROIOC for the Target Period is 25 percent, 33
percent of the Stock Option shall be vested and exercisable.
	 
	 	d.	 	If Average ROIOC during the Target Period does not reach 25
percent, the Stock Option is forfeited and no longer exercisable.

     The parties agree and acknowledge that incremental amounts of the Stock Option will vest for
Average ROIOC between 25 percent and 30 percent and between 30 percent and 35 percent. For
example, if Average ROIOC is 28 percent, 53 percent of the Stock Option shall be vested and
exercisable.

     3.2 The following terms shall have the following meaning when used herein:

	 	a.	 	“Average ROIOC” means the weighted average ROIOC for the three
fiscal years of the Company ending December 31, 2007, 2008 and 2009.
	 
	 	b.	 	“ROIOC” for a fiscal year of the Company means Adjusted
Operating EBITDA for such year divided by Invested Operating Capital for such
year.
	 
	 	c.	 	“Invested Operating Capital” for a fiscal year of the Company
is the sum of the following items from the consolidated year end balance sheet
as shown on the Company’s audited financial statement for such year:
	 
	 	 	 	Accounts receivables, less allowances for doubtful accounts

Inventories

Net property, plant and equipment

Patents and trademarks included in intangibles

Other assets

Long term receivables

Less accounts payable
	 
	 	d.	 	“Adjusted Operating EBITDA” for a fiscal year of the Company is
the sum of the following items from the consolidated year end statements of
operations as shown on the Company’s audited financial statement for such year:
	 
	 	 	 	Net income (loss) from continuing operations

Interest expense

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	 	 	 	Net periodic postretirement benefits in excess of cash payments

Restructuring costs

LIFO

Minority interest

Severance accrual

Stock compensation expense

Provision for income tax

     3.3 The award percentages are based on projections for the Target Period which were made by
the Company and are set forth in the 2007 Business Plan, a copy of which projections are attached
hereto and incorporated herein as Exhibit A. Said projections are based on the continued
operation of the Company and its Subsidiary Corporations in their current ordinary course during
the Target Period. The parties agree and acknowledge that Invested Operating Capital and Adjusted
Operating EBITDA may be recast by the Company to adjust for any unforeseen extraordinary
circumstance that may occur during the Target Period, including, but not limited to, a change in
accounting methods, the discontinued operations of a Subsidiary Corporation or a division, or the
sale or acquisition of a business or brand.

     3.4 Subject to Section 5, the Stock Option shall expire and cease to be exercisable ten years
after the date of this Agreement, or on such earlier date as may be provided herein.

     3.5 The Stock Option may be partially exercised from time to time within the limits on
exercisability set forth in Section 3.1.

Section 4. Method of Exercise

     The Stock Option or any part thereof may be exercised only by the giving of written notice to
the Secretary of the Company, which notice shall state the election to exercise the Stock Option
and the number of whole shares of Common Stock with respect to which the Stock Option is being
exercised. Such notice must be accompanied by payment of the full purchase price for the number of
shares of Common Stock purchased. Such payment shall be made: (a) in immediately available funds
(or the equivalent thereof acceptable to the Company) or (b) in such other consideration as the
Committee deems appropriate, including, but not limited to, shares of Common Stock owned by the
Optionee, or a combination of cash and other consideration having a total Fair Market Value, as so
determined, equal to the full purchase price. Subject to Section 6 and as soon as practicable after
it receives payment of the purchase price, the Company shall deliver to the Optionee a certificate
or certificates for the shares of Common Stock so purchased.

Section 5. Termination of Employment

     5.1 Except to the extent otherwise provided in Section 5.2 or 5.3, any portion of the Stock
Option that has not previously been exercised shall terminate upon the Optionee’s termination of
employment with the Company or a Subsidiary corporation for any reason, including death, and shall
not be exercisable after such date.

     5.2 If the Optionee’s employment terminates with the Company or a Subsidiary Corporation other
than by reason of death, dismissal for cause (as defined herein) or resignation

3

 

from employment
without the Company’s prior consent, the Optionee may thereafter exercise the Stock Option granted
hereby only on the following terms and conditions: (a) such exercise may be made only to the extent
the Optionee is entitled to exercise such Stock Option on the date
his or her employment terminates; and (b) such exercise must be made by the earlier of the
expiration date of such Stock Option, determined pursuant to Section 3, or the ninetieth day after
his employment terminates; provided, that if the Optionee’s employment terminates by reason of
disability described in Section 22(e)(3) of the Code, the foregoing ninety day period shall be
increased to one year.

     5.3 If the Optionee dies while in the employ of the Company or a Subsidiary Corporation, or
dies after his or her employment terminates and during a period in which the Stock Option is
exercisable pursuant to Section 5.2, the Stock Option granted hereby shall be exercisable by
earlier of the expiration date of such Stock Option or ninety days after the date of the Optionee’s
death, to the extent that the Optionee was entitled to exercise such Stock Option on the date of
death. The Optionee may designate a beneficiary or beneficiaries (“Designated Beneficiary or
Beneficiaries”) on the Designated Beneficiary form attached to this Agreement to exercise the
Option after the Optionee’s death and to receive shares of Common Stock acquired pursuant to such
exercise. If the Optionee does not complete the Beneficiary Designation form or the Designated
Beneficiary or Beneficiaries has or have predeceased the Optionee or cannot be located, the Option
shall be transferred in accordance with the Optionee’s will or, if the Optionee has no will, in
accordance with the applicable state laws of descent and distribution. In this case, the Option
shall be exercisable by the Optionee’s testamentary transferee or transferees after his or her
death and shares of Common Stock acquired in connection with the exercise of the Options shall be
transferred to such Transferee or Transferees. Any person or entity acquiring stock pursuant to
the exercise of the Option after the Optionee’s death shall be bound by all the terms and
conditions of the Plan and this Agreement which would have applied to the Optionee’s exercise of
the Stock Option granted hereby (if he or she had lived) including, without limitation, the
provisions of Section 6 and Section 11.

     5.4 References herein to an individual’s employment shall include any and all periods during
which such individual is considered an employee of the Company or a Subsidiary Corporation. The
Optionee shall be deemed to have terminated employment when the Optionee completely ceases to be
employed (within the meaning of the preceding sentence) by the Company and all of its Subsidiary
Corporations. The Committee may in its discretion determine (a) whether any leave of absence
constitutes a termination of employment within the meaning of this Agreement, and (b) the impact,
if any, of any such leave of absence on the Stock Option granted under this Agreement.

     5.5 The term “dismissal for cause” as used herein shall mean:

	 	a.	 	an act or omission by the Optionee that causes material harm to
the Company or a Subsidiary Corporation of which the Optionee is notified in
writing by the Company and the Optionee has not corrected within ten (10) days
of such notification;

4

 

	 	b.	 	any continued neglect of, or failure to perform, duties by the
Optionee of which the Optionee is notified in writing by the Company and the
Optionee has not corrected within ten (10) days of such notification;
	 
	 	c.	 	the Optionee’s performing services for any other corporation or
person which competes with the Company or a Subsidiary Corporation while he or
she is employed by the Company or a Subsidiary Corporation and without the
written approval of the chief executive officer of the Company; or
	 
	 	d.	 	any conviction of the Optionee or plea of guilty (or nolo
contendere) by the Optionee to a felonious crime.

provided, however, that if, at the time in question the Optionee is a party to an employment
agreement with the Company or any of its Subsidiary Corporations which contains a definition of
“cause” which is inconsistent with the provisions of this Section 5.5, the terms of such employment
agreement shall define “dismissal for cause” for the purposes of this Plan Agreement.

			
	Section 6.	 	Securities Law Restrictions and Other Restrictions on Transfer of Shares of Company
Common Stock Purchased Pursuant to this Agreement

	 	a.	 	The Optionee represents that upon exercise of a Stock Option,
shares of Common Stock shall be purchased for the Optionee’s own account and
not on behalf of others. Federal and state securities laws govern and restrict
the Optionee’s right to offer, sell or otherwise dispose of any such shares
unless the shares are first registered under the Securities Act of 1933 (the
“Securities Act”) and state securities laws (which the Company is not required
to do), or in the opinion of the Company’s counsel, such offer, sale or other
disposition is exempt from registration or qualification thereunder. The
Optionee shall not offer, sell or otherwise dispose of any shares purchased
pursuant to this Agreement in any manner unless they are first registered under
the Securities Act and any applicable state securities laws except in a
transaction which, in the opinion of counsel to the Company, is exempt from the
registration requirements.
	 
	 	b.	 	Restrictive Legend. The certificates representing the
shares of Common Stock purchased pursuant to this Agreement shall bear the
following legend, plus other legends the Company deems necessary or desirable
in connection with securities laws or other rules, regulations or laws.
	 
	 	 	 	THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 (THE “ACT”) AND ARE “RESTRICTED SECURITIES”
AS DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. THE SECURITIES MAY NOT BE
SOLD, OFFERED FOR SALE OR OTHERWISE DISTRIBUTED EXCEPT (i) IN CONJUNCTION
WITH

5

 

	 	 	 	AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE ACT,
OR (ii) IN COMPLIANCE WITH RULE 144, OR (iii) PURSUANT TO AN OPINION OF
COUNSEL TO THE CORPORATION THAT SUCH REGISTRATION OR
COMPLIANCE IS NOT REQUIRED AS TO SAID SALE, OFFER OR DISTRIBUTION.

Section 7. Non-Assignability

     No right granted to the Optionee under the Plan or this Agreement, except as otherwise
provided in this Agreement, shall be assignable or transferable (whether by operation of law or
otherwise and whether voluntarily or involuntarily), other than by will or by the laws of descent
and distribution. During the life of the Optionee, all rights granted to the Optionee under the
Plan or under this Agreement shall be exercisable only by the Optionee.

Section 8. Withholding Taxes

     Whenever under the Plan and this Agreement shares of Common Stock are to be delivered upon
exercise of a Stock Option, the Company shall be entitled to require as a condition of delivery
that the Optionee remit an amount sufficient to satisfy all federal, state and other governmental
withholding tax requirements related thereto; provided, that in lieu of or in addition to the
foregoing, the Company shall have the right to withhold such sums from compensation or other
amounts otherwise due to the Optionee.

Section 9. Requirement of Notification on Section 83(b) Election

     If the Optionee shall, in connection with the exercise of a Stock Option, make the election
permitted under Section 83(b) of the Code (i.e., an election to include in his or her gross income
in the year of transfer the amounts specified in section 83(b) of the Code), he or she shall notify
the Company of such election within ten days of filing notice of the election with the Internal
Revenue Service, in addition to any filing and notification required pursuant to regulations issued
under the authority of Section 83(b) of the Code.

Section 10. Adjustments Upon Changes in Capitalization

     In the event of any increase or decrease, after the date of this Agreement, in the number of
issued shares of Common Stock resulting from the subdivision or combination of shares of Common
Stock or other capital adjustments, or the payment of a stock dividend, or other increase or
decrease in such shares effected without receipt of consideration by the Company, the Committee
shall proportionately adjust the number of shares subject to the Stock Option, the purchase price
set forth in Section 2.1, and any and all other matters deemed appropriate by the Committee;
provided, however, that any Stock Option to purchase fractional shares resulting from any such
adjustment shall be eliminated. Adjustments under this Section shall be made by the Committee,
whose determination as to what adjustments shall be made, and the extent thereof, shall be final,
binding and conclusive.

Section 11. Reorganization

6

 

     In the event of a change in the ownership or effective control of the Company or a change in
the ownership of a substantial portion of the assets of the Company within the meaning of Section
409A(2)(A)(v) of the Code (each such event being hereafter called a “reorganization event”), or in
the event that the Board shall propose that the Company enter into a reorganization
event, then the Stock Option shall vest and become exercisable in full, and thereafter, the
Committee may in its discretion (a) by written notice to the Optionee, provide that the Stock
Option will be terminated unless exercised within thirty days (or such longer period as the
Committee shall determine in its sole discretion) after the date of such notice, and/or (b) provide
that such holder shall receive, with respect to each share of Common Stock subject to such Stock
Option an amount equal to the excess of the Fair Market Value of such shares of Common Stock
immediately prior to the occurrence of such reorganization event over the exercise price per share
underlying such Stock Option with such amount payable in cash, in one or more kinds of property
(including the property, if any, payable in the transaction) or in a combination thereof. Wherever
deemed appropriate by the Committee, any such action may be made conditional upon the consummation
of the applicable reorganization event.

Section 12. Right of Discharge Reserved

     Nothing in the Plan or in this Agreement shall confer upon the Optionee the right to continue
in the employment, or service of the Company or any of its Subsidiary Corporations, or affect any
right which the Company or any of its Subsidiary Corporations may have to terminate the employment
or service of the Optionee. The parties agree and acknowledge that the Optionee is an at-will
employee of the Company or a Subsidiary Corporation. The Optionee and the Company each retain the
right to terminate such employment relationship at any time.

Section 13. No Rights as a Stockholder

     Neither the Optionee nor any person succeeding to the Optionee’s rights hereunder shall have
any rights as a stockholder with respect to any shares of Common Stock subject to the Stock Option
until the date of the issuance of a stock certificate to him or her for such shares. Except for
adjustments made pursuant to Section 10, no adjustment shall be made for dividends, distributions
or other rights (whether ordinary or extraordinary, and whether in cash, securities or other
property) for which the record date is prior to the date such stock certificate is issued.

Section 14. Nature of Payments

     14.1 Any and all grants of Stock Options and issuance of shares of Common Stock hereunder
shall be in consideration of services performed by the Optionee for the Company or for its
Subsidiary Corporations.

     14.2 Any and all issuances of shares of Common Stock hereunder shall constitute a special
incentive payment to the Optionee. Such issuances and/or income realized upon exercise of a Stock
Option shall not be taken into account in computing the amount of salary or compensation of the
Optionee for the purposes of determining any pension, retirement, death or other benefits under (a)
any 401(k), pension, retirement, profit-sharing, bonus, life insurance, disability or other benefit
plan of the Company or any Subsidiary Corporation or (b) any

7

 

agreement between the Company or any
Subsidiary Corporation, on the one hand, and the Optionee, on the other hand, except as such plan
or agreement shall otherwise expressly provide.

Section 15. Committee Determinations

     The Committee’s determinations under the Plan and this Agreement need not be uniform and may
be made by it selectively among persons who receive, or are eligible to receive, awards under the
Plan (whether or not such persons are similarly situated). All decisions, interpretations and
determinations by the Committee with regard to any question or matter arising hereunder or under
the Plan shall be conclusive and binding upon the Company and the Optionee.

Section 16. Section Headings

     The Section headings contained herein are for the purpose of convenience only and are not
intended to define or limit the contents of said sections.

Section 17. Notices

     Any notice to be given to the Company or the Committee hereunder shall be in writing and shall
be addressed to the Secretary of the Company at Thermadyne Holdings Corporation, 16052 Swingley
Ridge Court, Suite 300, Chesterfield, MO 63017, or at such other address as the Company may
hereafter designate to the Optionee by notice as provided herein. Any notice to be given to the
Optionee hereunder shall be addressed to the Optionee at the address set forth beneath his or her
signature hereto, or at such other address as the Optionee may hereafter designate to the Company
by notice as provided herein. Notices hereunder shall be deemed to have been duly given when
personally delivered or mailed by registered or certified mail to the party entitled to receive the
same.

Section 18. Successors and Assigns

     This Agreement shall be binding upon and inure to the benefit of the parties hereto and the
successors and assigns of the Company and, to the extent set forth in Section 5.3, the heirs and
personal representatives of the Optionee.

Section 19. Other Payments or Awards

     Nothing contained in this Agreement shall be deemed in any way to limit or restrict the
Company or any Subsidiary Corporations from making any award or payment to the Optionee under any
other plan, arrangement or understanding, whether now existing or hereafter in effect.

Section 20. Governing Law and Venue

     This Agreement shall be governed by and construed in accordance with the laws of the state of
Missouri despite any laws of that state that would apply the laws of a different state. In the
event of litigation arising in connection with this Agreement and/or the Plan, the parties hereto
agree to submit to the jurisdiction of state and Federal courts located in the state of Missouri.

8

 

Section 21. Severability

     If any term or provision of this Agreement, or the application of this Agreement to any person
or circumstances, shall at any time or to any extent be invalid, illegal or unenforceable in any
respect as written, both parties intend for any court construing this Agreement to modify or
limit that provision so as to render it valid and enforceable to the fullest extent allowed by
law. Any provision that is not susceptible of reformation shall be ignored so as to not affect any
other term or provision of this Agreement, and the remainder of this Agreement, or the application
of that term or provision to persons or circumstances other than those as to which it is held
invalid, illegal or unenforceable, shall not be affected thereby and each term and provision of
this Agreement shall be valid and enforced to the fullest extent permitted by law.

Section 22. Entire Agreement Modification

     The Plan and this Agreement contain the entire agreement between the parties with respect to
the subject matter contained in this Agreement and may not be modified, except as provided in the
Plan, as it may be amended from time to time in the manner provided in the Plan, or in this
Agreement, as it may be amended from time to time by a written document signed by each of the
parties to this Agreement. Any oral or written agreements, representations, warranties, written
inducements or other communications with respect to the subject matter contained in this Agreement
made before the signing of this Agreement shall be void and ineffective for all purposes.

Section 23. Authority to Receive Payments

     Any amount payable to or for the benefit of a minor, an incompetent person or other person
incapable of receipting therefore shall be deemed paid when paid to the conservator of such
person’s estate or to the party providing or reasonably appearing to provide for the care of such
person, and such payment shall fully discharge the Company, members of the Committee and the Board
with respect thereto.

Section 24. Counterparts

     This Agreement may be executed simultaneously in two or more counterparts, each of which shall
constitute an original, but all of which taken together shall constitute one and the same
Agreement.

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date and year
first above written.

	 	 	 	 	 	 	 	 	 	 	 
	THERMADYNE HOLDINGS
CORPORATION	 	 	 	OPTIONEE	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	Optionee Signature:	 	 	 	 
	 

	 	 

Patricia S. Williams
	 	 	 	Optionee Name:
	 	 

	 	 
	 

	 	 	 	 	 	Date of Signature:
	 	 

	 	 
	 

	 	 	 	 	 	 	 	 

	 	 

9

 

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Optionee’s Home Address:	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 

10

 

NON-QUALIFIED STOCK OPTION AGREEMENT

THERMADYNE HOLDINGS CORPORATION

2004 STOCK INCENTIVE PLAN

BENEFICIARY DESIGNATION

To the Secretary of Thermadyne Holdings Corporation (“Company”)

I hereby designate the following person, persons or entity as primary and secondary Designated
Beneficiaries of my rights that shall be transferred under the Thermadyne Holdings Corporation
2004 Stock Incentive Plan (the “Plan”) and the Thermadyne Holdings Corporation 2004 Stock Incentive
Plan Non Qualified Stock Option Agreement (“Agreement”) between the Company and me dated
                    ,
20___ upon my death:

Primary Beneficiary [include address and relationship]:

Secondary Beneficiary [include address and relationship]:

I RESERVE THE RIGHT TO REVOKE OR CHANGE ANY BENEFICIARY DESIGNATION. I HEREBY REVOKE ALL PRIOR
DESIGNATIONS (IF ANY) OF BENEFICIARIES AND SECONDARY BENEFICIARIES.

The Company shall cause all Options under the Agreement to be transferred by reason of my death
pursuant to the Agreement to the Primary Beneficiary, if he, she or it survives me, and if no
Primary Designated Beneficiary shall survive me, then to my secondary Designated Beneficiary. If
no named Designated Beneficiary survives me, then all such Options shall be transferred in
accordance with the terms of the Agreement. The recipient of such Options under the Agreement may
exercise such Options to the extent provided in the Agreement and receive the shares of Company
Common Stock acquired in connection with such exercise..

	 	 	 
	 

	 	 
	Date of this Designation

	 	Signature of Participant

NOTE: Unless provided otherwise in this Beneficiary Designation, the Company shall transfer all
options to be transferred to more than one Designated Beneficiary equally to the living Designated
Beneficiaries.

11

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