Document:

exv10w1

Exhibit 10.1

CONTRACT

BETWEEN

STILLWATER MINING COMPANY

AND

UNITED STEEL WORKERS UNION

AND ITS LOCAL 11-0001

EAST BOULDER UNIT

 

 

Table of Contents

Articles of Agreement

	 	 	 	 	 	 	 
	Introduction
	 	 	 	 	 	 
	Article 1
	 	—	 	Recognition	 	1
	Article 2
	 	—	 	Non-Discrimination	 	2
	Article 3
	 	—	 	Union Security	 	2
	Article 4
	 	—	 	Management Rights	 	3
	Article 5
	 	—	 	Management-Union Committee	 	4
	Article 6
	 	—	 	Grievance and Arbitration	 	4
	Article 7
	 	—	 	Medical Arbitration	 	7
	Article 8
	 	—	 	Seniority	 	7
	Article 9
	 	—	 	Probationary Period	 	8
	Article 10
	 	—	 	Job Postings	 	9
	Article 11
	 	—	 	Lay-Off and Recall	 	10
	Article 12
	 	—	 	Severance Pay	 	11
	Article 13
	 	—	 	Hours of Work and Overtime	 	11
	Article 14
	 	—	 	Sick/Personal Leave/Attendance	 	12
	Article 15
	 	—	 	Discipline Process	 	14
	Article 16
	 	—	 	Classification and Wages	 	15
	Article 17
	 	—	 	Safety and Health	 	15
	Article 18
	 	—	 	Benefits	 	17
	Article 19
	 	—	 	Holidays	 	19
	Article 20
	 	—	 	Vacation	 	20
	Article 21
	 	—	 	Union Leaves of Absence	 	21
	Article 22
	 	—	 	Family and Medical Leave	 	21
	Article 23
	 	—	 	Military Service	 	23
	Article 24
	 	—	 	Bereavement Leave	 	23
	Article 25
	 	—	 	Jury and Witness Duty	 	23
	Article 26
	 	—	 	Contracting Out	 	24
	Article 27
	 	—	 	Miscellaneous	 	24
	Article 28
	 	—	 	Mine/Plant Closure	 	26
	Article 29
	 	—	 	No Strike	 	26
	Article 30
	 	—	 	Past Practice	 	26
	Article 31
	 	—	 	Validity	 	27
	Article 32
	 	—	 	Complete Agreement	 	27
	Article 33
	 	—	 	Term of Agreement	 	27
	Appendix A
	 	—	 	Base Rate Structure	 	29
	 
	 	—	 	Lines of Progression	 	30
	 
	 	—	 	Memoranda of Understanding            	 	31-40

 

 

ARTICLES OF AGREEMENT

This Agreement is between Stillwater Mining Company East Boulder operation (hereinafter referred to
as the “Company”), its successors and assigns, and the USW International Union (hereinafter
referred to as the “Union”), its successors and assigns. The general purpose of this agreement is
to foster and promote a consistent, stable and cooperative relationship between the Company and its
represented employees to promote the mutual interests of the Company and the Union. By setting
forth mutual promises and obligations herein assumed, the parties agree as follows:

ARTICLE 1

RECOGNITION

Section 1. The Company recognizes the Union as the sole and exclusive bargaining representative
for the purpose of collective bargaining with respect to rates of pay, benefits, hours of
employment pertaining to Stillwater Mining Company employees employed by the Company at 12 Miles FS
205, McLeod, Montana, to wit: All hourly production and maintenance employees, warehouse employees
and custodians; but excluding all temporary employees, student summer hires, professional and
technical employees, office clerical employees, guards, dispatchers, supervisors and those above
the rank of supervisor as defined in the National Labor Relations Act.

Section 2. The Union’s Workers’ Committee represents Union interests to the Company. The Workers’
Committee will be selected by the Union, and consist of four (4) members, including the Local Unit
Chairman who will be the Chair. The three (3) remaining members will consist of one (1) Miner’s
Representative, one (1) Surface Representative, and one (1) Underground Representative. Alternates
may be selected to replace absent Committee members.

Section 3. The Local Unit Chairman will promptly notify the Company, in writing, of the names of
the Workers’ Committee members and Stewards. The Company will be notified, in writing, of any
changes to these groups.

Section 4. The Company recognizes the Workers’ Committee as the bargaining committee for purposes
of collective bargaining; as representatives in the Management-Union Committee meetings as set
forth in Article 5; and as Chief Stewards as set forth in Article 6. The Company recognizes the
role of the International Union Representative. As such, the International Union Representative
may be present at meetings between Management and the Union, providing notice is given in advance.
The Union agrees that such activities will not result in any disruption of the Company’s operations
and employees will not neglect their duties and responsibilities.

 

 

ARTICLE 2

NON-DISCRIMINATION

Section 1. The Company and Union agree that neither will discriminate nor harass any employee or
applicant for employment because of race, creed, marital status, color, age, disability, religion,
national origin or sex in violation of any applicable Federal, State or local law.

Section 2. There shall be no discrimination or harassment by the Company, its officers or agents,
or the Union or its members against any employee because of membership or non-membership in any
lawful union, participation or non-participation in any lawful union activity, or because any
employee has exercised or failed to exercise any right specifically provided under this Agreement.

ARTICLE 3

UNION SECURITY

Section 1. Every employee covered by this Agreement must, for the life of this Agreement after the
grace period described below, satisfy a financial obligation to the Union as the exclusive
bargaining representative. Under this Agreement, the financial obligation for union members is an
amount equivalent to monthly dues, and for non-members a fee amount, as determined by the Union, to
perform the duties as exclusive representative under this Agreement.

This financial obligation is a condition of continued employment and is in consideration for the
cost of representation and collective bargaining and is not contingent upon present or future
membership in the Union.

The grace period for this Agreement is thirty (30) calendar days following the completion of the
employee’s probationary period or by the thirtieth (30th) calendar day following the effective date
of this Agreement, whichever is later.

Neither the Union, Company, nor any of their officers, agent or members will intimidate or coerce
employees about membership or non-membership in the Union. If any dispute arises as to whether
there has been any violation of this provision (or whether an employee affected by this Agreement
has failed to meet the financial obligation), the dispute will be submitted directly to arbitration
for determination.

The Union will indemnify and save the Company harmless against any and all claims, demands, suits
or other forms of liability that will arise out of or by reason of action taken by the Company
complying with the provisions of this Article.

Section 2. For employees in the bargaining unit, the Company agrees to deduct the Union dues for
the month from the wages due each month, providing each employee from whose check Union dues are to
be deducted has on file a signed payroll deduction authorization.

 

 

ARTICLE 4

MANAGEMENT RIGHTS

Section 1. Management retains all the general and traditional rights to manage the business as
well as any rights under the law or agreed by the parties. These rights rest exclusively in
management who are the sole decision makers regarding the Company’s operations. The following list
of specific management rights is not intended to be all-inclusive, but are some of those rights
considered to be general rights of management. The fact that a particular management right is not
included in the following listing does not mean the right does not exist.

Section 2. The Company has the right to determine the number of employees required by the Company
at any place from time to time, for any and all operations; to determine the jobs, content of jobs
and to modify, combine or end any job, classification, department or operation; to hire, classify,
transfer, promote, demote and layoff employees; to determine qualifications, evaluate performance
and assign and direct the workforce; to maintain order and discipline; and to reprimand, suspend,
discharge and otherwise discipline for just cause.

Section 3. The Company has the right to create and administer rules, policies and procedures.
This will include the right to establish or revise attendance, work, substance abuse, drug and/or
alcohol testing, functional testing and safety rules. The Company has the right to establish or
revise a disciplinary policy to address violations of these rules.

Section 4. The Company also has the right to determine the number and types of facilities and
working places; the kinds and locations of machines, tools and equipment to be used; and the right
to schedule production; to maintain efficiency; to introduce new or improved research methods,
materials, processes, techniques, machinery and equipment, means of processing, distribution and
mining; to set the standards of productivity and the products to be produced; to determine
employees’ working schedules, including, but not limited to, the number of hours and shifts to be
worked; to determine when overtime work is necessary and to assign overtime; to choose customers;
to utilize part-time and temporary employees; to decide where or when training on a particular
operation or job is required, how much training is required and the right to move or retrain
employees; to determine the amount and form of any incentive and/or bonus compensation to be paid
in addition to wages; to establish, implement, modify, suspend or terminate any contract or
incentive program; to use independent contractors to perform any work or services.

Section 5. The Company’s failure to exercise any right or function reserved to it, or the exercise
of a management right in a particular way, will not prevent the Company from exercising any of its
rights in the future or in some other way not in conflict with this Agreement. The only
restrictions on management rights are those expressly provided for in this Agreement.

 

 

Section 6. The exercise of these rights alleged to be in conflict with any other provision of this
Agreement will be subject to the grievance and arbitration procedures.

ARTICLE 5

MANAGEMENT-UNION COMMITTEE

Section 1. The Company and the Union recognize the benefits of an open forum where information,
mutual concerns, interests, and complaints (not covered by the grievance and arbitration
procedures) affecting the workplace can be freely discussed, with a view to exploring possible
solutions which are acceptable and beneficial to employees, the Union and the Company. Without
limiting the opportunity for the Union and the Company to meet informally at the East Boulder
Operations, the parties agree to establish a Management-Union Committee (MUC).

Section 2. The Workers’ Committee will serve as representatives for the Union at MUC meetings.
The Company representatives will be comprised of Senior Management personnel.

Section 3. MUC meetings will normally be held during regular business hours on at least a
quarterly basis or as necessary. Logistics for the meeting will be mutually agreed upon and
coordinated through the Human Resources Department. Senior Management from the East Boulder
Operations will discuss agenda items with the Local Union President and the Local Unit Chairman
prior to the meeting. A formal meeting agenda will be given to all Committee members at least five
(5) days prior to the meeting, whenever possible.

Section 4. Hours spent by MUC members attending MUC meetings will be considered as time worked and
will be paid at the employee’s normal base rate. The Company will make every reasonable effort to
schedule the MUC meetings during the members’ regular shift.

Section 5. The MUC is limited to joint discussion and consultation, and is not intended to limit
or restrict the rights reserved to the Union or the Company by this Agreement. The Committee is
not intended to take the place of normal communication between employees and the Company, or to
serve as an alternative to the grievance and arbitration procedures of this Agreement.

ARTICLE 6

GRIEVANCE AND ARBITRATION

Section 1. It is recognized that, from time to time, dispute(s) between the Company and its
employees may occur. The employees will try to settle these differences as quickly as possible
with their immediate foreman or supervisor. The employee has the right to be accompanied and
assisted by a Steward or Committee Member. If the disagreement cannot be resolved between the
parties, a grievance may be filed.

 

 

A “grievance” is a dispute as to the interpretation, application, or alleged violation of any of
the provisions of this Agreement.

Section 2. Should a grievance arise that is not verbally settled with the immediate supervisor, an
earnest effort will be made to settle such grievances in the following manner:

Step 1: The grievance shall be presented in writing to the Human Resources Department
within fifteen (15) days from the time the employee has knowledge of the occurrence. The
supervisor has fifteen (15) days to respond in writing to the grievance. If the supervisor’s
written answer is not accepted, the Union must advance the grievance through the Human Resources
Department to the applicable manager or his designee in writing within fifteen (15) days
following the supervisor’s written answer.

Step 2: The applicable manager or his designee will have up to fifteen (15) days to
conduct a grievance meeting. The meeting will be comprised of no more than three Union
Representatives and up to three Company Representatives, to include at least one representative
from the department from which the grievance arose. In an earnest effort to resolve the dispute,
the Company and Union will disclose throughout the grievance process, facts and information
relied upon. Following the meeting the Company will have fifteen (15) days to respond in writing
to the grievance. The Union will have fifteen (15) days to respond in writing to the Companies’
answer from the second step meeting.

Section 3. Failure by either party to comply with the time limits set forth in this Article shall
result in the grievance being advanced to the next step. The time limits set forth in this Article
may be extended, in writing, by mutual agreement, on a case-by-case basis. The Company will pay
for time spent by Union representatives in grievance meetings that are scheduled during their
regular working hours.

Section 4. If the answer from the grievance Step 2 meeting is not accepted by the Union, the
grievance will automatically be referred to arbitration. The Company and Union will agree on a
tentative date for the arbitration, not to exceed 50 days following the Union’s notice to the
Company that they do not accept the Company’s Step 2 response.

	 	A.	 	The Company and the Union mutually agree to select a three (3)-member arbitration panel.
The arbitrators will normally reside in the State of Montana and will have direct experience
in collective bargaining disputes. The parties will establish a rotation for the
arbitration panel. Following the hearing, the arbitrator’s decision will be reduced to
writing and submitted to both parties within five (5) working days from the date of the
hearing.
	 
	 	B.	 	Should the members of the panel be unavailable or in instances where the Company and the
Union determine not to use a member of the Panel, the

 

 

	 	 	 	following procedure will be utilized. The parties shall refer the grievance to the Federal
Mediation and Conciliation Service. The parties shall request the Federal Mediation Service
to submit a panel of seven (7) arbitrators. Each party shall have the right to reject one
panel of arbitrators. Striking of the first name shall be determined by the flip of a coin
and then the parties shall alternately strike a name until one arbitrator is left. The
arbitrator shall be notified of selection by a letter from the parties requesting that the
arbitrator set a time for the hearing, subject to the availability of the Company and the
Union representative. Arbitration hearings shall be held in Billings, Montana.

Section 5. In rendering a decision, the arbitrator will be governed and limited by this
Agreement’s provisions, applicable law, and the expressed intent of the parties as described in
this Agreement. The arbitrator will have no power to add to, subtract from, or modify any of the
terms and provisions of this Agreement, or substitute his judgment for that of the Company. The
arbitrator will confine his judgment strictly to the facts submitted in the hearing, the evidence
before him, and this Agreement’s express terms and provisions. The arbitrator’s decision will be
final and binding upon the parties.

Section 6. The Company and the Union shall bear the costs of their respective expenses, and shall
share, equally, the cost of the arbitrator.

Section 7. The Union and the employees waive their right to pursue any judicial or administrative
remedy against the Company as to any matter subject to the procedures established in this Article
until such procedures are exhausted. Any settlement under the procedures established under this
Article, short of arbitration, will be binding upon the Company, the Union, and the employees and
will preclude any further administrative or judicial relief.

Section 8. Any employee has the right to have a Steward or Committee Member present if they are
called into a meeting, which may result in disciplinary action.

Section 9. If it is necessary for a Steward or Committee Member to take time off during their
regularly scheduled shift to investigate or resolve a grievance, they shall request the permission
of their immediate supervisor, which permission shall not be unreasonably withheld. When a Steward
or Committee Member enters an area other than their normal work area, they shall inform the
supervisor of that area of their presence and reason for being there. As well, a Steward or
Committee Member shall inform their supervisor when returning to their normal work area or duties.

Section 10. Grievances dealing with suspensions and/or discharges will be moved immediately to
Step 2 of the grievance procedure.

 

 

Section 11. The Union, by not exercising any functions thus reserved to it or by exercising any
such function in a particular way, shall not be deemed to have waived its right to exercise such
function as set forth in this Agreement.

Section 12. Stewards will be compensated for time spent in grievance meetings when the meetings
are held during their regularly scheduled work shift or when the Steward is specifically requested
by the Company.

ARTICLE 7

MEDICAL ARBITRATION

Section 1. In the event a dispute arises concerning the physical fitness of an employee to return
to work or to continue to work, an attempt to resolve the dispute by conference or consultation
between a licensed physician selected by the Company and a licensed physician selected by the
Union, will first be made.

Section 2. If no satisfactory conclusion is reached and the Union or the Company so elects, a
Board of three (3) licensed physicians will be selected, one by the Company, one by the Union, and
one by the two so-named, who will decide the case. The decision of the Board will be final and
binding on both parties to this Agreement and retroactive to the date the dispute arose.

Section 3. The Company will bear the expense of the physician of its choice, and the Union will
bear the expense of the physician of its choice. The expense of the third physician will be paid
by the losing party. In the event that the decision of the Board does not result in a clear-cut
losing party, the expense of the third physician will be paid equally by the parties.

ARTICLE 8

SENIORITY

Section 1. Company seniority will be determined by an employee’s date of original employment with
the Company, or predecessor companies Chevron or Manville, if there has been no service break.
Company seniority will apply only for purpose of applicable benefit plans and earned vacation.

Section 2. Union seniority will be determined from the employee’s date of original employment with
the Company at its facilities covered by this Agreement or date of employment if there had been a
break in service. An employee’s union seniority will be lost if the employee:

	 	A.	 	Quits.
	 
	 	B.	 	Is discharged for just cause.
	 
	 	C.	 	Fails to work for any reason for two (2) years, or length of service, whichever is less.
	 
	 	D.	 	Fails to return to work upon termination of a leave of absence.

 

 

In addition, an employee’s Union seniority shall be lost if the employee is promoted to a full-time
non-bargaining unit position for a period in excess of one (1) year. If the employee returns to
the bargaining unit, he/she must make the Union whole.

If an employee is re-employed subsequent to termination for an above-stated cause, said employee
shall be considered a new employee for seniority purposes.

Section 3. Department Mine, Concentrator, Underground Maintenance and Warehouse seniority will be
determined by the date on which the employee begins continuous service in one of the following
departments:

	 	A.	 	Mine
	 
	 	B.	 	Concentrator/Concentrator Maintenance/Surface
	 
	 	C.	 	Underground Maintenance
	 
	 	D.	 	Warehouse

The employee will lose department seniority in any previous department once department seniority is
established in any other department.

Section 4. Upon request, the Company will provide the Union with a current seniority list which
will also be posted in the workplace.

Section 5. If employees are hired on the same day, seniority will be decided by the birthday rule.
For example, a January 1 birth date would be senior over any other date in a calendar year,
without the employee’s age being a factor.

ARTICLE 9

PROBATIONARY PERIOD

Section 1. All new employees will be considered probationary employees for a period of seven
hundred eighty (780) hours worked.

Section 2 Unless Company policies provide otherwise, probationary employees will not be eligible
for any benefits granted to regular employees under this Agreement. No terms of this Agreement
other than this Article and the appropriate wage rate will apply to probationary employees.

Section 3. Employees continued in employment after the end of the probationary period will become
full-time employees and will be credited with continuous service from the original date of hire.

 

 

ARTICLE 10

JOB POSTINGS

Section 1. Whenever the Company determines a vacancy, other than a temporary vacancy, exists in
any biddable job classification, or a new job becomes available, the Company will post a job
posting on the bulletin boards for ten (10) consecutive days. Employees desiring to bid on the
vacancy will apply in writing to the Human Resources Department within the allotted ten (10) days.
At the end of the ten (10) days, the successful senior qualified candidate will be determined based
on their departmental seniority. If there are no qualified employees within the department, Union
seniority will apply. If no qualified candidate from within the bargaining unit applies or no bid
is received within the time frame set forth above, the job may be filled by the Company from any
other sources. Laid off employees, who have seniority rights, will be eligible to bid on all job
postings. Upon request, a copy of the job posting and of all bids will be provided to the Local
Union President and the Local Unit Chairman.

Section 2. The Company will determine the successful candidate based on relevant job-related
criteria utilizing job skills assessment. The requisite skills, knowledge and ability to perform
the relevant tasks of the job may be determined through tests, licenses or certifications.
Employees who have incurred any of the following in the twelve (12) months prior to bidding or
promotion are not entitled to consideration for advancement:

one (1) or more suspensions, or

two (2) or more written safety-related disciplinary actions, or

one (1) or more safety-related lost time incidents, or

one (1) or more MSHA medical reportable incidents.

Section 3. Temporary vacancies of less than ninety (90) days may be filled at the Company’s
discretion.

Section 4. If the successful bidder proves unsatisfactory after a thirty (30) day evaluation
period, or chooses not to continue in the new position within the thirty (30) day evaluation
period, the employee will be returned to the position last held with no loss of seniority. The
Company will then fill the position with the next senior qualified candidate from the original
posting.

Section 5. The Company will award the bid and, to the extent practicable, will transfer the
successful bidder to the awarded position within twenty (20) days of acceptance. In the event the
Company cannot allow the employee to transfer without negatively impacting the respective
operation, the employee will be paid at the higher rate of pay beginning the twenty-first
(21st) day after acceptance.

Section 6. An employee who is awarded a job posting outside his department cannot bid for another
job for a period of one (1) year. An employee who is awarded

 

 

a job posting within his department cannot bid for another job for a period of four (4) months.

ARTICLE 11

LAY-OFF AND RECALL

Section 1. For the purpose of lay-off and recall, qualifications to perform the job(s) concerned
and seniority shall apply. The employee(s) with the least departmental seniority in the affected
classification within the department shall be the first full-time employee laid off in each
department, and so on. Employee(s) displaced from their classification(s) shall first be entitled
to displace the junior employee in their department provided they are qualified to perform the work
involved. Employee(s) not qualified to displace junior employees within their department shall be
entitled to displace the junior employee in other departments, based upon Union seniority, provided
they are qualified to perform the work involved. Upon recall, the last full-time employee laid off
will be the first full-time employee recalled, providing such employee is qualified to perform the
job in question, utilizing Union seniority. Temporary employees and probationary employees will be
laid off prior to employees on the seniority list, unless the temporary or probationary employees
have special skills not held by regular employees.

Section 2. An employee has fifteen (15) days to respond to a recall to work by certified mail.
The fifteen (15) days will begin running when the Company makes its initial attempt to recall.
Unless other arrangements are made, the recalled employee will have up to fifteen (15) days to
return to work after responding to the Company’s offer. Failure to respond or return to work
within the time limits outlined in this Section will result in a loss of seniority.

Section 3. The Company will meet with the MUC Committee to discuss any layoffs or
reduction-in-force prior to implementation. The Company will notify the Union of any pending
layoff or reduction-in-force as far in advance as possible. If a layoff is less than ninety (90)
days in duration, the Company will pay its portion of the cost of fringe benefits during the
layoff.

Section 4. For purposes of this Article, it is understood that an employee’s qualifications to
perform a job will be based on relevant job-related criteria utilizing job Skills Assessment. The
requisite skills, knowledge and ability to perform the relevant tasks of the job may be determined
through tests, licenses or certifications.

Section 5. The proposed creation of a new test, or the elimination or change of an existing test,
shall first be discussed with the Local Unit Chairman with written notification provided to the
Local Union President. If the parties aren’t able to agree on such new test or changes, the Union
may file a grievance as to the reasonableness of the test as set forth in this Agreement.

 

 

Section 6. Employees on lay off are required to inform the Company of any address changes via
Certified Mail.

Section 7. If a laid-off employee, with recall rights, refuses a reinstatement offer, the employee
forfeits his/her Union seniority.

ARTICLE 12

SEVERANCE PAY

Section 1. Any full-time employee who loses seniority because of a long-term layoff or a permanent
mine closure will be entitled to one (1) week of severance at the employee’s base rate of pay for
each full year of continuous service with the Company up to a maximum of fifteen (15) weeks of pay.

Any full-time employee who is laid off and granted severance pay pursuant to this section, if
re-employed and subsequently laid off through a reduction-in-force, shall be denied a second
severance pay allowance unless continuous service since re-employment has been one year or more.
Any employee who, is laid off or whose employment is severed and granted severance pay pursuant to
this Section, returns to active work within a length of time which is less than that paid as
severance, may continue to reimburse the Company the excess severance pay within sixty (60) days of
recall. Any excess severance pay repaid to the Company as set forth above, shall be paid to the
employee in the event of a subsequent lay-off.

ARTICLE 13

HOURS OF WORK AND OVERTIME

Section 1. The normal work week will begin at 7:01 a.m. each Sunday and end at 7:00 a.m. the
following Sunday. Overtime will paid for all hours worked in excess of forty (40) hours during a
work week.

Section 2. Changes in working schedules (other than temporary incidental changes) will be
discussed with the MUC prior to implementation.

Section 3. An employee who is called back for immediate work after leaving Company property or who
is called for immediate work outside their scheduled working hours, and actually begins working,
will be paid time and one-half (11/2) for work actually performed. Under this Section, employees
will be called out and paid for a minimum of five (5) hours at the time and one-half (11/2) rate (in
lieu of travel time and mileage).

Section 4. If an employee’s regularly scheduled shift is canceled less than ninety (90) minutes
before it is scheduled to begin, the employee will either work a minimum of four (4) hours or be
paid four (4) hours at this regular hourly rate in lieu of work.

 

 

Section 5. Upon prior approval of the supervisors involved, employees may mutually agree to
exchange shifts or days off provided the exchange does not cause any disruption or increased cost
to the Company, and that the exchange does not cause the employee to be on duty more than sixteen
(16) hours in any twenty-four (24) hour period.

Section 6. The Company agrees that overtime will be distributed as uniformly and equally as
possible and practical within each classification. Employees will not be forced to work overtime
as long as there are employees in their classification who are qualified and willing to work such
overtime. If no qualified employees volunteer to accept requested overtime, the Company will
assign the overtime to a qualified employee, based on reverse order of department seniority.
Employees who decline offered overtime will be charged for the overtime offered as if it has been
worked for the purpose of overtime allocation.

Section 7. Any employee who has worked sixteen (16) consecutive hours will be compensated at
double (2) time for all hours worked over sixteen (16). Any employee who has worked sixteen (16)
or more hours will be allowed a rest period of at least eight (8) hours with no loss of overtime
pay.

Section 8. Pyramiding of overtime is prohibited.

Section 9. For the purpose of computing weekly overtime the following will be considered as time
worked: holidays, jury/witness service, union business involving contract administration or
negotiations for the purpose of renewing this Agreement, which fall on an employee’s regularly
scheduled work day; or meetings, training and conferences required by the Company. These hours
will not exceed the number of hours in the employee’s normal work day.

Section 10. Except for the first shift worked for each work rotation, an employee will be given
twenty-four (24) hours notice of a change in shift. In the event that such twenty-four (24) hours
notice is not given, the employee shall receive one and one-half (11/2) times their base rate for all
hours worked on the first shift of the change. This does not apply to employees requesting change
of rotation.

Section 11. Employees who work a shift other than day shift will be paid a shift differential of
fifty cents ($.50) per hour.

ARTICLE 14

SICK/PERSONAL LEAVE/ATTENDANCE

Section 1. Effective July 9th, 2008 and each July 1 during the term of this Agreement,
employees who have completed their probationary period shall have available six (6) full or
partial, paid or unpaid days for sick/personal leave each year as well as one (1) vacation day.
The vacation day may be taken at random and is to be used at the employee’s discretion to cover
attendance issues. This leave is

 

 

intended for time for which the employee is absent for reasons of non-work related sickness, injury
or accident, emergency or personal business.

Section 2. In order to receive payment for hours absent in a shift under this Article, employees
shall be required to submit on the first shift worked after the absence(s), a doctor’s statement
verifying the employee’s inability to work due to his/her own non-occupational illness or injury.

Section 3. Commencing September 2008 and each year thereafter, employees shall be paid a bonus for
all sick/personal days not used from July 1 of the previous year to July 1 of the current year.
Such bonus shall be paid as follows:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	No. of Unused Days	 	Bonus Calculation	 
	6
	 	 	2.00	 	 	 	X	 	 	hours/shift	 	 	X	 	 	base rate	 	 	X	 	 	6 days
	5
	 	 	1.75	 	 	 	X	 	 	hours/shift	 	 	X	 	 	base rate	 	 	X	 	 	5 days
	4
	 	 	1.50	 	 	 	X	 	 	hours/shift	 	 	X	 	 	base rate	 	 	X	 	 	4 days
	3
	 	 	1.50	 	 	 	X	 	 	hours/shift	 	 	X	 	 	base rate	 	 	X	 	 	3 days
	2
	 	 	1.25	 	 	 	X	 	 	hours/shift	 	 	X	 	 	base rate	 	 	X	 	 	2 days
	1
	 	 	1.00	 	 	 	X	 	 	hours/shift	 	 	X	 	 	base rate	 	 	X	 	 	1 day

Section 4. Employees who qualify for Short Term Disability (“STD”) benefits are required to use
available vacation, the personal holiday and/or sick /personal days (or a combination thereof) to
satisfy the waiting period. The Company will waive the advanced notice requirements for an
employee electing to use paid vacation.

Section 5. Upon completion of their probationary period, employees shall be granted a pro-rated
number of full or partial, unpaid or paid sick/personal days available for use in the remainder of
the year. Employees completing their probationary period in July, August or September are eligible
for four (4) sick/personal days; in October, November or December, three (3) days; in January,
February or March, two (2) days; or in April, May or June, one (1) day.

Section 6. To maintain order and efficiency in the Stillwater Mining Company operation, employees
must be available to perform their work on a full-time basis. Good attendance, including reporting
to work on time, is a condition of continued employment.

Section 7. Any excused time off covered in the Collective Bargaining Agreement or under State or
Federal employment law will be excluded from this Article; however, proper reporting off procedures
must be followed for all absences.

Section 8. Reporting Off. Employees must call the designated call off number at least thirty (30)
minutes prior to the start of their shift and state the reason for the absence. Calls must be made
by the employee and not from spouses, family members or others. Employees who report off properly
will use one (1) sick/personal day for each absence.

 

 

Section 9. Tardy. Employees will be considered Tardy should he/she report to work within three (3)
hours from the start of his/her scheduled shift. Employees that will be tardy must call the
designated call off number prior to the start of their shift. If the tardy occurs on a shift when
shuttle service is unavailable to the mine, a management person will call the employee as soon as
is practical to arrange for transportation to the mine from Big Timber. The employee is required
to leave accurate and complete information on the call off and be available to take the phone call
from management. Employees who are tardy will use one (1) sick/personal day upon the third
offense. Every tardy thereafter, and within the twelve (12) month period, will result in the use
of one sick/personal day.

In the event that management cannot arrange for transportation to the mine, the employee will not
be charged a tardy but will be required to work one regular scheduled shift within his/her next
scheduled rotation off. The employee must state which day in their next scheduled rotation off
will be their regular work day to the management person that returns their call.

Section 10. Employees who fail to properly report off shall be defined as AWOL and shall be
charged sick/personal days as follows:

	 	A.	 	Employee fails to report off properly, but calls within one hour after the start of shift
– uses 2 sick/personal days
	 
	 	B.	 	Employee does not call off – uses 3 sick/personal days

Section 11. Employees who have further absence(s), not otherwise provided for in this Agreement,
will be discharged.

ARTICLE 15

DISCIPLINE PROCESS

Section 1. The Company has guidelines of conduct, which provides an opportunity to address employee
performance and/or modify behavior. The Company has the right to initiate progressive disciplinary
procedures as follows:

	 	 	 	Step 1: Written Warning
	 
	 	 	 	Step 2: One (1) day suspension without pay
	 
	 	 	 	Step 3: Three (3) day suspension without pay
	 
	 	 	 	Step 4: Discharge

Section 2. The type of progressive discipline given will be based upon the severity of the problem.
Progressive disciplinary procedures may be taken by the Company for just cause. In cases of
written warnings and suspensions, the Company will meet with the employee and a union steward
regarding performance. The employee will also be informed that further failure to improve
performance will result in the more severe discipline up to and including discharge.

 

 

Termination of employment will be in cases where the severity of the problem justifies termination
or in cases where other progressive disciplinary steps have been taken.

Section 3. An employee may elect not to have a Union representative present.

Section 4. Records of disciplinary action will remain in the employee’s personnel file for
twenty-four (24) months from the date it was originally written. Twenty-four (24) months after the
date it originated, the disciplinary action will not be cited for other progressive discipline or
job performance issues.

ARTICLE 16

CLASSIFICATION AND WAGES

Section 1. The classifications and rates of pay are attached to this Agreement and will continue
in effect for the duration of this Agreement.

Section 2. Employees temporarily assigned to work in a classification other than their current
classification will continue to be paid the rate of pay for their current classification.

Section 3. Management personnel may perform bargaining unit work when training, investigating,
testing, and in emergencies, or situations in which no qualified bargaining unit employee is
available to do the job required.

Section 4. If a full-time employee is demoted, through no fault of their own, from their regular
classification, the employee will receive the higher rate of pay for a period of one (1) week for
each full year of service at the previous classification, at the time assigned to the lower
classification. There will be no pyramiding of rate retention under this Article.

ARTICLE 17

SAFETY AND HEALTH

Section 1. The Company and the Union believe an effective safety and health program is essential
for employee morale and well-being, as well as the long-term viability of the Company.
Accordingly, the Company recognizes its obligation to prevent, correct and eliminate all unhealthy
and unsafe working conditions and practices. Employees are also expected to recognize, address and
report unhealthy or unsafe working conditions. Further, employees will follow all Company safety
and health rules and procedures and comply with applicable State and Federal regulations.

Section 2. The Company will recognize one (1) Joint Safety and Health Committee (Committee) for
the East Boulder Operations comprised of representatives from the Management Union Committee and an
equal number of Management representatives. This Committee will meet monthly, or as needed, to
discuss safety

 

 

and health issues, recommend corrective actions, and communicate safety and health information back
to employees.

Section 3. The Committee will assign (at their respective leadman rate) one (1) bargaining unit
employee to act as a Health and Safety Representative (Representative) for the East Boulder mine.
The Representative shall serve at the discretion of the Committee and will be reviewed annually by
the Joint Safety and Health Committee. The Committee shall establish duties (excluding matters
involving the administration of the Collective Bargaining Agreement) and responsibilities as well
as qualifications for the Representative. The Representative shall provide updates to the
Committee during Committee meetings and shall administratively report to the East Boulder Safety
Manager.

Section 4. The Company will conduct occupational health and medical monitoring to measure
exposures in the workplace as appropriate, or upon the recommendation of the Joint Safety and
Health Committee. Results will be distributed to the Committee, the Local Union President and the
Local Unit Chairman, to the extent that employee confidentiality is not compromised.

Section 5. The Company will pay for required medical examinations and the results will be kept in
the employee’s confidential medical file. Upon request, a copy of these records will be provided
to the affected employee.

Section 6. Personal protective equipment required by statute or for special tasks not regularly
performed will be provided by the Company at no cost to the employee. Upon employment, the Company
will provide a one-time allocation of other Company required personal protective equipment. The
Company will allow employees to purchase subsequent or additional personal protective equipment
through the warehouse at Company cost. Employees whose personal protective equipment is damaged or
destroyed through abnormal conditions, not attributed to abuse, will receive replacement personal
protective equipment through the warehouse at Company expense.

Section 7. Prescription safety glasses will be provided at a rate of one (1) pair per year.
Replacement non-prescription safety glasses will be available.

Section 8. The Company will provide for an ongoing safety and health training program. The
content of health and safety training courses will be reviewed with the Committee prior to
selection. Time spent on Company approved training will be considered as time worked. The cost of
Company approved training will be paid by the Company and expenses reimbursed based on current
Company policy.

Section 9. No employee will perform unsafe work or be required to perform unsafe work. Employees
performing unsafe work or unsafe practices will be subject to disciplinary action, up to and
including discharge. Refusal to perform unsafe work will not warrant or justify any present or
future disciplinary action.

 

 

ARTICLE 18

BENEFITS

Section 1. The Company will provide bargaining unit members with the benefits described in this
Article.

Section 2. There will no unilateral changes by the Company to benefit levels during the life of
this Agreement, except those required by regulatory agencies.

Section 3. BENEFIT PLANS

A. Health Insurance (medical, dental and prescription)

	 	•	 	The Company will pay 80% of premium and Employee will pay 20% of the premium.
Employee premiums will be deducted on a pretax basis. Employee contributions will
be subject to adjustment on January 1 of each year of this Agreement.
	 
	 	•	 	Deductible does not apply to most provider services
	 
	 	•	 	$1,000 / $2,000 out-of-pocket maximum amounts
	 
	 	•	 	Diagnostic and preventative services: No deductible. Payable at 100 percent of
the allowable fee. Dental work involving crowns are designated Type II service.
	 
	 	•	 	Prescriptions

	 	 	 	 	 	 	 	 	 
	 

	 	Generic
	 	$	10	 	 	(maximum 30 day supply)
	 

	 	Formulary
	 	$	20	 	 	(maximum 30 day supply)
	 

	 	Non-Formulary
	 	$	30	 	 	(maximum 30 day supply)

	 	•	 	Some maintenance type prescriptions, i.e., high blood pressure, cardiovascular,
insulin. etc., are available in a 90-day supply for the price of (2) co-pays through
a mail order pharmacy.
	 
	 	•	 	Accident benefits are payable only for services provided within 90 days of the
Accident. After 90 days or $500, whichever comes first, general Plan Benefits
apply.
	 
	 	•	 	Treatment of Chemical Dependency is subject to pre-authorization and case
management

	 	B.	 	Short Term Disability

	 	•	 	Eligibility: All full-time active employees who regularly work at least 30 hours
per week and have completed one (1) year of continuous service.

 

 

	 	•	 	Elimination Period: Loss of wages for 40 hours or 5 scheduled shifts, whichever is
less, for Disability due to a non-occupational injury or illness.
	 
	 	•	 	Schedule of Benefits

Less than 1 year of Company seniority     no benefits

1 year of Company seniority, but less than

5 years of Company
seniority                     .60% benefit up to 26 wks

5 years or more of Company seniority      100% benefit up to 26 wks

	 	C.	 	Long Term Disability

	 	•	 	Waiting Period: 180 days
	 
	 	•	 	Benefit: 60% of regular pay, not to exceed $6,000 per month subject to reduction
by deductible sources of income or Disability Earnings
	 
	 	•	 	Maximum Period: Age 65

	 	D.	 	401(k) Plan and Trust

	 	•	 	Employer contributions are equal to a 1 to 1 match based on an employee’s pretax
contributions up to 6%.
	 
	 	•	 	Employer matching contributions made in non-restricted Company stock
	 
	 	•	 	Maximum employee deferral amount will be 60%; subject to Plan guidelines and
limitations
	 
	 	•	 	During the term of this Agreement, the Company will maintain the current matching
contribution level for the 401(k) Plan and retains the ability to change the form of
match (cash or stock)

	 	E.	 	Vision Service Plan
	 
	 	F.	 	Company Sponsored Life Insurance and Accidental Death & Dismemberment
	 
	 	G.	 	Employee Assistance Plan and Nurse Advisor
	 
	 	H.	 	Employee Stock Purchase Plan
	 
	 	I.	 	Flexible Spending Accounts

 

 

	Section 4. Revised benefit brochure will be distributed to all employees periodically. This
information is being provided as a summary only and not intended to replace or amend and benefit
Plan Documents or Summary Plan Descriptions.

ARTICLE 19

HOLIDAYS

Section 1. The following days will be considered holidays:

	 	 	 
	New Year’s Day

	 	Good Friday
	Memorial Day

	 	Independence Day
	Labor Day

	 	Thanksgiving
	Day after Thanksgiving

	 	Christmas Eve
	Christmas Day

	 	Personal Holiday

Section 2. Employees who are required to work on any of the above holidays will receive pay at the
rate of time and one-half (11/2) plus holiday pay for all hours worked. Each full-time employee not
required to work on these holidays will receive eight (8) hours pay for such holidays at their
regular rate of pay. Employees scheduled to work on a holiday who fail to report to work will not
receive holiday pay.

Section 3. When a Saturday or Sunday holiday is observed on a weekday, the holiday pay will apply
on that weekday. Employees scheduled to work a rotating shift, will be paid holiday pay on the
calendar day on which the holiday occurs. The actual holiday schedule will be posted each year, as
soon as practical.

Section 4. An employee absent on either the scheduled workday before or after the holiday will not
receive pay if the absence is not scheduled and approved by the Company. An employee who is
receiving disability benefits on both the scheduled workday before and after the holiday will not
receive pay for the holiday.

Section 5. Employees will be entitled to one (1) personal holiday which may be taken after the
employee has completed their probationary period, provided at least one (1) rotation’s notice is
given to the Company. Scheduled annual vacation will take precedence over the scheduling of
personal holidays. In the case where more than one employee per crew requests to take a personal
holiday on the same day, department seniority will govern if the personal holiday had been
scheduled between January 1 and March 31 of any year. Personal holidays will be allocated on a
first come, first serve basis if scheduled after April 1 of any year. Personal holidays will be
allocated and granted based on operational needs and the wishes of the employee. No more than one
(1) person per crew will be allowed off on personal holiday on any particular day, except at
Company discretion. When an employee takes the personal holiday immediately prior to or
immediately after a holiday, the employee will be paid according to this Article, provided that the
employee works the last scheduled shift prior to and the next scheduled shift after the holiday and
the personal holiday. If the personal holiday is not scheduled to be taken in the calendar

 

 

year, the employee will be paid for eight (8) hours for the personal holiday at their base rate.
Personal holidays may not be banked or carried over into the next year.

ARTICLE 20

VACATION

Section 1. Employees will be eligible for paid vacation time in accordance with the following
provisions.

	 	 	 
	 
	 	Amount of Paid
	Years of Service
	 	Vacation Available
	 	 	 
	1 through 4
	 	80 hours
	5 through 9
	 	120 hours
	10 or more
	 	160 hours

Section 2. At the beginning of the calendar year, each full-time employee who has completed one
year of continuous service will be credited with vacation based on length of service. Employees
who have less than one year of service, but have completed their probationary period, will be
credited with a pro rata amount of vacation on January 1.

Section 3. At the beginning of each calendar year, full-time employees who have completed fourteen
(14) or more years of continuous service will receive a one thousand dollar ($1,000) bonus.

Section 4. Employees may choose to receive pay in lieu of time off for vacation. Pay in lieu of
time off will also be provided when the Company requests an employee to forego his vacation. If,
due to an extreme situation, the Company requires an employee to work during a previously scheduled
vacation, the Company will make the employee whole for any verifiable, non-refundable expenses
incurred by the employee. Vacation cannot be carried over into the next calendar year without the
Company’s approval. Vacation must be taken in full-shift increments, unless shift scheduling
dictates otherwise.

Section 5. Vacation schedules will be posted or circulated among employees during the month of
January of each year for employee to indicate their vacation preference. Vacation request forms
will be utilized, with a copy of the approved form returned to the employee. Vacation will be
scheduled to meet the preference of employees whenever possible. In case of conflict over any
vacation period, vacation will be granted in order of department seniority. Where an employee
elects to split a vacation, that employee’s seniority rights will prevail only for the first choice
until all other employees in the vacation unit have had their first choice. It is understood that
the Company retains the right to schedule vacations as operational conditions dictate. However, no
employee will be forced to take vacation which has already been approved at a time undesirable to
the employee. Vacation requests must be pre-authorized by the supervisor at least one (1)
rotation’s notice in advance.

 

 

Section 6. Holidays falling during an employee’s vacation will be compensated for by holiday pay
or by a one-day extension of the vacation, as the employee elects.

Section 7. Employees terminating service with the Company will be paid vacation earned in the
current year.

Section 8. Employees on vacation will be paid in ten (10) hour shift increments.

ARTICLE 21

UNION LEAVES OF ABSENCE

Section 1. The Company may grant a short-term unpaid leave of absence for Union officials or
members to attend Union functions. These leaves will be granted based on the Company’s operational
requirements. Employees will retain service, seniority and benefit during this leave of absence.
Requests for these leaves must be made by the Union to the Company not less than fourteen (14) days
before the leave.

Section 2. Upon thirty (30) days written notice from the Union, a long-term unpaid leave of
absence to perform work for the Union will be granted for one (1) employee for up to one (1) year.
The employee may elect to return to the employee’s previous classification with a thirty (30) day
written notice for reinstatement from the Union to the Company. The employee will hold and
accumulate seniority and continuous service for all purposes during the leave. Upon request, the
employee will be allowed to continue in the Company Group Health Plan, and any Disability Plans, by
paying the full cost of the benefits during the leave. Reinstatement will be granted if the
employee is physically able to return to the previously held classification, as determined by the
Company paid physical examination. If the employee is physically unable to return to the previous
held classification, the employee will be allowed to return to a job the employee is qualified to
perform, if such job exists.

ARTICLE 22

FAMILY AND MEDICAL LEAVE

Section 1. The Company will comply with all applicable State and Federal laws, which address
employees’ rights to request or obtain family or medical leaves. Employees who have been employed
for at least one (1) year and worked at least 1250 hours during the preceding twelve (12) month
period, shall be granted leave of absence in the event of: the birth of a child and in order to
care for that child; the placement of a child for adoption or foster care, and to care for the
newly placed child; care for a spouse, child, or parent with a serious health condition; or a
serious health condition that makes the employee incapable of performing the essential functions of
his/her job.

Such leave will be guaranteed for up to a maximum of twelve (12) weeks in a rolling twelve (12)
month period. Leave while an employee is off work receiving short-term disability benefits or
worker’s compensation benefits will be designated as Family

 

 

Medical Leave, to the extent that it qualifies under State or Federal law, and will run
concurrently with Family Medical Leave Act “FMLA” leave.

Section 2. Request for such leave shall be made through the Human Resources Department. When the
need for leave is foreseeable, the employee shall provide at least thirty (30) days advance notice.
An employee may request more than one (1) family leave within a twelve (12) month period, but the
total time on leave within that period may not exceed twelve (12) weeks.

Section 3. The employee will provide medical certification to the Company confirming the need for
family and medical leave within 15 days of the request for leave. The request for such leave may
require renewal and new medical certification submitted to the Company every thirty (30) days.

Section 4. Credited service for all purposes under this Agreement will accrue during the period
covered by the family and medical leave of absence. The employee returning from family and medical
leave will be reinstated to the position held prior to the leave, or a comparable position.

Section 5. Employees will not be disciplined for absences covered under the FMLA. Employees will
not be required to use vacation for approved FMLA absences. However, the Company will waive the
advanced vacation notice requirement for an employee electing to use paid vacation for this leave.

Available vacation, the personal holiday and/or sick/personal days (or a combination thereof) used
to satisfy the waiting period for short-term disability benefits will not be charged against FMLA
leave entitlement.

Section 6. Represented Employees that are absent from work due to their own non-occupational
illness or injury and are eligible and approved for leave under the FMLA but do not qualify for STD
benefits will be required to substitute paid leave for the unpaid leave provided under the FMLA.

Employees absent in the above circumstances will be provided the option of using available regular
vacation, personal holiday and/or sick and personal days as paid time to be substituted for unpaid
Family and Medical Leave. The Company will waive the advanced notice requirement for an employee
electing to use paid vacation and/or personal holiday. The order and combination of which days to
be used is at the option of the employee, provided that their selection is made in writing and
received by the Human Resources department no later than 15 days after receiving notice that such
selection needs to be made. If the employee makes no choice to the contrary within the 15 days,
the Company will substitute available sick/personal days, regular vacation and the personal
holiday, in that order, for all unpaid Family and Medical leave taken under the circumstances
described herein.

Section 7. Employees will not perform work for pay while on family and medical leave, except with
written permission of the Company.

 

 

Section 8. All other requirements and conditions under the FMLA of 1993 shall apply.

ARTICLE 23

MILITARY SERVICE

Section 1. The Company shall accord to each employee who leaves active employment to enter
military service of the United States or Reserve or National Guard, such rights as the employee
shall be entitled to under the Uniform Services and Reemployment Rights Act (USERRA).

Section 2. With the exception of an Executive Order, any employee who is required to attend duty
for the Reserve of the Armed Forces or the National Guard shall be paid, for a period or periods
not to exceed a total of seventeen (17) days per calendar year and such pay shall be the excess of
the employee’s base wages over Government base wage for the period of military leave, not to
include any forms of living expenses.

ARTICLE 24

BEREAVEMENT LEAVE

Section 1. In the event of the death of an employee’s immediate family member, a reasonable period
of unpaid leave will be granted to the employee. Immediate family includes the employee’s spouse,
children, stepchildren, parents, stepparents, brothers, sisters, stepbrothers, stepsisters,
grandparents and grandchildren, and the parents and grandparents of the employee’s spouse.

Section 2. To offset the expenses associated with attending the funeral, any employee who has
completed the probationary period will be paid forty (40) hours of base wages in the event of the
death of a spouse, child or step-child, or twenty-four (24) hours of base wages in the event of the
death of any other immediate family members listed above.

ARTICLE 25

JURY AND WITNESS DUTY

Section 1. Employees selected for jury duty or subpoenaed for witness service will be allowed the
necessary time off to perform the service. Employees must contact their immediate supervisor prior
to reporting for jury duty or subpoenaed witness service. An employee who reports and is then
released from service must immediately contact the employee’s supervisor to coordinate return to
work. The Company will make reasonable allowances for travel and shift schedules.

Section 2. Regular full-time employees who are absent because of jury duty, government subpoena
where the Company is not a party, or Company subpoena,

 

 

will be paid the difference between the jury duty or specified witness pay and their normal base
wages for scheduled shifts missed. Employees will be required to provide documentation of service
to receive applicable pay.

ARTICLE 26

CONTRACTING OUT

Section 1. The Company, having the availability of equipment, skills, manpower, or the time to do
the work, will not contract out classified work now being done by employees of the Company as long
as there are qualified employees or qualified former employees with re-employment rights and
provided such contracting does not result in the layoff of employees or their displacement to other
job classifications covered by this Agreement. This will not apply to the installation of
equipment or construction or any other activities not ordinarily done by employees of the Company.

Section 2. Before commencing any major contract job to be performed on the premises, the Company
will notify the Local Union President and/or the Local Unit Chairman in writing and/or email
describing the nature, scope, and expected duration of the work to be performed. The Company
further agrees that it will meet, as necessary, with the Local Union President and/or Local Unit
Chairman to discuss information concerning contracting out. Requests for such meetings shall not
be unreasonably denied.

ARTICLE 27

MISCELLANEOUS

Section 1. In July of each year, mechanics and electricians who are on the seniority list will
receive a tool allowance of four hundred dollars ($400.00) and two hundred dollars ($200.00)
respectively.

Section 2. In July of each year, the Company will provide a one hundred fifty dollar ($150.00)
boot allowance for all employess on the seniority list. It is required that employee’s be in
compliance with Stillwater Mining Company’s safey footwear equipment.

Section 3. The Company will provide a secure bulletin board at each of the locations covered by
this Agreement.

Section 4. Employees in the bargaining unit will have access to their own personnel file, by
appointment with the Human Resources Manager, for the purpose of reviewing it in person. A union
representative may accompany the employee.

Section 5. Required notices may be made by personal service, confirmed facsimile transmission or
certified mail, return receipt requested. The designated party for the Company is the Human
Resources Manager. The designated party for the Union is

 

 

the International Representative. Each party will provide the other with the name and address of
the individual who is authorized to receive notices under this Section.

Section 6. Any employee required to work more than two (2) hours beyond the normal quitting time
will be provided with a meal. An additional meal will be furnished for each additional four (4)
hours of continuous work. The Company may, with the agreement of the involved employees, in lieu
of a meal and time to eat the meal, compensate the employee by the payment of one (1) additional
hour at time and one-half (11/2).

Section 7. The Company shall provide reasonable access to East Boulder Mine property to the Local
International Representative, Local President, Local Chairman and Workers Committee members for the
purpose of conducting Union business as provided by existing permits, agreements, plans and
proceedures.

Sectiion 8. The Company shall provide emergency response systems including medical, communication,
and rescue coordination.

Section 9. It was agreed upon that the bus transporting employees to the East Boulder Operations
will have a scheduled site arrival time of fifteen (15) minutes before the start of shift. The bus
is scheduled to depart the property fifteen (15) minutes after the end of shift. If the bus
departs the property more than fifteen (15) minutes after the scheduled departure time as a result
of Company actions, employees will receive one half (1/2) hour of their base pay. It is understood
that employees will arrive at work and be ready on time for their scheduled shift or the Big Timber
departure time will need to be re-adjusted. Bussing shall continue along existing routes including
reasonable locations within the pickup and drop off points as provided by the bussing provider.

Section 10. The Company and the Union shall equally share the expense to print and provide a copy
of this Agreement in booklet form produced by a union print shop, if available, to each employee.

Section 11. Employees that have completed probation and have less then one (1) year of service may
request an Emergency Leave of Absence for the reasons set-forth below in subsection (b). Before
any leave of Absence can be considered under this article, the employees must have used all their
vacation, sick/personal leave and personal holiday, and have a reasonable assurance of returning to
work unrestricted.

	 	a.	 	Upon an employee making the request for the Leave of Absence under this section of
the Collective Bargaining Agreement, the Company and Union will meet to review the
employee’s request and determine whether he or she has the special circumstance to qualify
for such leave.

 

 

	 	b.	 	This leave of absence will be utilized only for legitimate medical reasons. For
purposes of this section, a legitimate medical reason is defined as one that satisfies the
requirements for Family Medical Leave Act.
	 
	 	c.	 	Any occurrence which exceeds thirty (30) calendar days requires the employee to
request an extension in writing to the Company’s Human Resource Department. Upon receipt
of an extension request, the Company and Union will meet and determine if the extension
will be approved.

Any occurrence request for leave under this section will require the employee to provide proof of
medical condition.

ARTICLE 28

MINE/PLANT CLOSURE

Section 1. The Company agrees it will notify the Union in writing of any mine/plant closure at
least thirty (30) days in advance, or as is practical, in compliance with the Worker Adjustment
Retraining and Notification Act. The Company and the Union shall meet to bargain in good faith
regarding the effect and possible options for employees and the Company.

ARTICLE 29

NO STRIKE

Section 1. During the term of this Agreement, there will be no strike, work stoppage, picketing,
honoring of any picket line at the Company premises, work slowdown, sympathy strike, or any other
form of economic pressure directed against the Company or its services on the part of the Union or
its members covered by this Agreement. The Company will not lock out any bargaining unit employee
during the term of this Agreement.

Section 2. In the event of any breach of this Article, the Union will immediately declare publicly
that such action is unauthorized, will immediately order its members to resume their normal duties
and continue to take any necessary action to correct the problem and restore the Company to full
operation.

ARTICLE 30

PAST PRACTICE

Section 1. This Agreement supercedes any previous oral and written agreements between the Company,
its employees and the Union. The Company will not be bound by any past understandings, practices
and/or customs between the Company, its employees, and the Union on matters not specifically
governed by the terms of this Agreement, except those mutually agreed upon in writing during the
negotiations for this agreement.

 

 

ARTICLE 31

VALIDITY

Section 1. Nothing contained in this Agreement will be construed in any way as interfering with
the obligation of the parties to comply with any and all State and Federal laws, or any rules,
regulations, and orders of duly constituted authorities pertaining to matters covered by this
Agreement, and such compliance will not constitute a breach of this Agreement.

Section 2. If any court holds any part of this Agreement invalid, that decision will not
invalidate the entire Agreement.

ARTICLE 32

COMPLETE AGREEMENT

Section 1. This Agreement during its life may be amended only by mutual consent of the parties.
Any amendments made to this Agreement will be reduced to written form and will be duly signed by
the authorized representatives of the Company and the Union.

Section 2. The parties acknowledge that during the negotiations resulting in this Agreement, each
had the unlimited right to make proposals with respect to all subjects of collective bargaining.
The understandings and agreements arrived at by the parties after exercise of that right are
included in this Agreement. Therefore, the Company and the Union each waive the right and each
agrees that the other will not be obligated to bargain collectively with respect to any matter
referred to by this Agreement or with respect to any subject not specifically referred to in this
Agreement, except those required by law, even though the subject may not have been within the
knowledge or contemplation of either or both of the parties at the time that they negotiated this
Agreement.

ARTICLE 33

TERM OF AGREEMENT

Section 1. This Agreement will be in effect from July 9th, 2008 until noon July 1,
2012, and if not terminated at the end of that period by sixty (60) days written notice by one
party to the other prior to this date, will continue in effect until terminated by either party
upon ninety (90) days written notice of its desire to terminate or modify this Agreement.

 

 

APPENDIX A

STILLWATER MINING COMPANY

BARGAINING UNIT RATE STRUCTURE

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	7/9/2008	 	7/1/2009	 	7/1/2010	 	7/1/2011
	Position Title	 	Base Rate	 	Base Rate	 	Base Rate	 	Base Rate
	Lead — Electrician
	 	$	28.21	 	 	$	29.34	 	 	$	30.51	 	 	$	31.73	 
	Lead — Mechanic
	 	$	28.21	 	 	$	29.34	 	 	$	30.51	 	 	$	31.73	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Electrician 1
	 	$	25.88	 	 	$	26.92	 	 	$	27.99	 	 	$	29.11	 
	Mechanic 1
	 	$	25.88	 	 	$	26.92	 	 	$	27.99	 	 	$	29.11	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Lead — Miner/Mill Operator
	 	$	25.75	 	 	$	26.78	 	 	$	27.85	 	 	$	28.97	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Lead — UG Oper/UG
Cnstr/Hvy Eq Oper/Water
Plant Oper/Warehouse
	 	$	24.99	 	 	$	25.99	 	 	$	27.03	 	 	$	28.11	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Electrician 2
	 	$	23.85	 	 	$	24.81	 	 	$	25.80	 	 	$	26.83	 
	Mechanic 2
	 	$	23.85	 	 	$	24.81	 	 	$	25.80	 	 	$	26.83	 
	Mill Operator 1
	 	$	23.85	 	 	$	24.81	 	 	$	25.80	 	 	$	26.83	 
	Water Plant Operator 1
	 	$	23.85	 	 	$	24.81	 	 	$	25.80	 	 	$	26.83	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Diamond Driller 1
	 	$	23.62	 	 	$	24.57	 	 	$	25.55	 	 	$	26.57	 
	Miner 1
	 	$	23.62	 	 	$	24.57	 	 	$	25.55	 	 	$	26.57	 
	Sublevel Miner 1
	 	$	23.62	 	 	$	24.57	 	 	$	25.55	 	 	$	26.57	 
	U/G Construction 1
	 	$	23.62	 	 	$	24.57	 	 	$	25.55	 	 	$	26.57	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Heavy Equipment Operator 1
	 	$	22.51	 	 	$	23.41	 	 	$	24.35	 	 	$	25.32	 
	Miner 2
	 	$	22.51	 	 	$	23.41	 	 	$	24.35	 	 	$	25.32	 
	Sand Plant Operator
	 	$	22.51	 	 	$	23.41	 	 	$	24.35	 	 	$	25.32	 
	Sublevel Miner 2
	 	$	22.51	 	 	$	23.41	 	 	$	24.35	 	 	$	25.32	 
	UG Construction 2
	 	$	22.51	 	 	$	23.41	 	 	$	24.35	 	 	$	25.32	 
	UG Operator 1
	 	$	22.51	 	 	$	23.41	 	 	$	24.35	 	 	$	25.32	 
	Warehouse I
	 	$	22.51	 	 	$	23.41	 	 	$	24.35	 	 	$	25.32	 
	Water Plant Operator 2
	 	$	22.51	 	 	$	23.41	 	 	$	24.35	 	 	$	25.32	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Mechanic 3
	 	$	20.27	 	 	$	21.08	 	 	$	21.93	 	 	$	22.81	 
	Electrician 3
	 	$	20.27	 	 	$	21.08	 	 	$	21.93	 	 	$	22.81	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Diamond Driller 2
	 	$	19.42	 	 	$	20.20	 	 	$	21.00	 	 	$	21.84	 
	Heavy Equipment Operator 2
	 	$	19.42	 	 	$	20.20	 	 	$	21.00	 	 	$	21.84	 
	Lead Custodian
	 	$	19.42	 	 	$	20.20	 	 	$	21.00	 	 	$	21.84	 
	Mill Operator 2
	 	$	19.42	 	 	$	20.20	 	 	$	21.00	 	 	$	21.84	 
	Miner 3
	 	$	19.42	 	 	$	20.20	 	 	$	21.00	 	 	$	21.84	 
	Sublevel Miner 3
	 	$	19.42	 	 	$	20.20	 	 	$	21.00	 	 	$	21.84	 
	UG Construction 3
	 	$	19.42	 	 	$	20.20	 	 	$	21.00	 	 	$	21.84	 
	UG Operator 2
	 	$	19.42	 	 	$	20.20	 	 	$	21.00	 	 	$	21.84	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Custodian
	 	$	17.07	 	 	$	17.75	 	 	$	18.46	 	 	$	19.20	 
	Mill Operator 3
	 	$	17.07	 	 	$	17.75	 	 	$	18.46	 	 	$	19.20	 
	UG Operator 3
	 	$	17.07	 	 	$	17.75	 	 	$	18.46	 	 	$	19.20	 
	Warehouse 2
	 	$	17.07	 	 	$	17.75	 	 	$	18.46	 	 	$	19.20	 
	Laborer Rate
	 	$	15.50	 	 	$	16.00	 	 	$	16.50	 	 	$	17.00	 

 

 

Memorandum of Understanding

Between

Stillwater Mining Company

East Boulder Operation

AND

USW International Union, Local 11-0001

East Boulder Unit

The Company and the Union mutually agree to extend the Labor Agreement set to expire on July 1,
2008 at 12:00 noon Mountain Daylight Time (MDT). This extension will remain in effect until 11:59
p.m. July 10th, 2008 MDT.

Stillwater Mining Company,

East Boulder Operations

                                                            

Company Official

USW International Union, Local 11-0001,

East Boulder Unit

                                                            

Union Official

Signed
this
                     day of                     , 2008.

 

 

Memorandum of Understanding

Between

Stillwater Mining Company

East Boulder Operation

AND

USW International Union, Local 11-0001

East Boulder Unit

Stillwater Mining Company (Company), and USW International Union (Union), hereby agree as follows:

The following past practices or prior settlements will be continued throughout the duration of this
Agreement:

The Company provides a bonus payment to employees who participate in Mine Rescue at East Boulder
Operations. The Company agrees to continue its current practice through the life of this
Collective Bargaining Agreement.

Stillwater Mining Company,

East Boulder Operations

                                                            

Company Official

USW International Union, Local 11-0001,

East Boulder Unit

                                                            

Union Official

Signed this                     day of                     , 2008.

 

 

Memorandum of Understanding

Between

Stillwater Mining Company

East Boulder Operation

AND

USW International Union, Local 11-0001

East Boulder Unit

The Company agrees to pay represented employees providing EMS service to the East Boulder Mine
within the following guidelines.

	 	•	 	The Company will schedule appropriate EMS continuing education sessions at site.
	 
	 	•	 	The Company will schedule adequate sessions for each EMS employee to keep their
certification active and up to date.
	 
	 	•	 	The Company will make reasonable efforts to schedule these sessions in such a fashion
that the EMS employees will not have to miss any regularly scheduled work.
	 
	 	•	 	It is expected, to the extent practicable, that represented EMS employees participate
in continuing education classes that are scheduled on other than the employees’ regular
shifts.
	 
	 	•	 	Time spent in the EMS continuing education classes will be considered as worked time.
	 
	 	•	 	Represented employees that attend and participate in EMS continuing education classes
will be paid at their regular classified base rate of pay for the time spent in such
classes.

This Agreement will remain in effect until the end of the current term of the CBA, unless modified
or extended by mutual consent.

Stillwater Mining Company,

East Boulder Operations

                                                            

Company Official

USW International Union, Local 11-0001,

East Boulder Unit

                                                            

Union Official

Signed
this                     day of                      , 2008.

 

 

Memorandum of Understanding

Between

Stillwater Mining Company

East Boulder Operation

AND

USW International Union, Local 11-0001

East Boulder Unit

An employee who has qualified for Long Term Disability, Short Term Disability and/or Worker’s
Compensation will be able to participate in the following benefit plans: Medical/Dental &
Prescription Plan, Vision Service Plan, Employee Assistance Program, Nurse Advisor Program;
provided the employee continues to pay their portion of the premium. Non-payment of premiums will
result in loss of coverage.

The maximum benefit period is two (2) years. Employees will be eligible for COBRA benefits after
the benefit period has been terminated.

This Memorandum of Understanding will expire with the Current Collective Bargaining Agreement.

Stillwater Mining Company,

East Boulder Operations

                                                            

Company Official

USW International Union, Local 11-0001,

East Boulder Unit

                                                            

Union Official

Signed this                     day of                     , 2008.

 

 

Memorandum of Understanding

Between

Stillwater Mining Company

East Boulder Operation

AND

USW International Union, Local 11-0001

East Boulder Unit

Stillwater Mining Company (Company), and USW International Union hereby agree to the following:

Hourly employees represented by the USW International Union, Local 11-0001, East Boulder Unit will
be able to transfer to available hourly positions listed in the Collective Bargaining Agreement in
place at the Nye Mine or the Columbus Facilities under the following conditions:

	 	•	 	Employees wishing to transfer from East Boulder to the Nye Mine or the Columbus
Facilities must contact their site Human Resource department.
	 
	 	•	 	Employees requesting a transfer must have completed their probationary period under
the CBA.
	 
	 	•	 	The Company will determine the transfer qualifications based on relevant job-related
criteria utilizing job skills assessment. The requisite skills, knowledge and ability
to perform the relevant tasks of the job may be determined through tests, licenses or
certifications.
	 
	 	•	 	Employees who have incurred any of the following in the twelve (12) months prior to
transfer are not eligible for transfer consideration:
	 
	 	 	 	one (1) or more suspensions, or

two (2) or more written safety-related disciplinary actions, or

one (1) or more safety-related lost time incidents, or

one (1) or more MSHA medical reportable incidents

 

 

	 	•	 	Employees may be given one transfer opportunity per rolling 12 months regardless
whether they assume the position they are awarded or if they decline the position they
are awarded.
	 
	 	•	 	In the event the Company cannot afford to allow the employee to transfer at the
requested time (due to manpower, required skill, etc.) the Company will put the employee
on a list to be transferred at a time when the East Boulder operation will not be
negatively impacted.
	 
	 	•	 	Employees will establish new department seniority at the transferred location
beginning with their first day of work at that facility. Company seniority will not be
adversely affected for the purpose of vacation entitlement and 401-k vesting.

This Memorandum of Understanding will expire with the Current Collective Bargaining Agreement.

Stillwater Mining Company,

East Boulder Operations

                                                            

Company Official

USW International Union, Local 11-0001,

East Boulder Unit

                                                            

Union Official

Signed
this                     day of                      , 2008.

 

 

Memorandum of Understanding

Between

Stillwater Mining Company

East Boulder Operation

AND

USW International Union, Local 11-0001

East Boulder Unit

Stillwater Mining Company (Company) and USW International Union hereby agree to the following:

	1.	 	East Boulder Bargaining Unit employees will be provided bidding opportunities from the East
Boulder Bargaining Unit to bargaining unit positions at the Columbus Facilities of Stillwater
Mining Company.

	2.	 	In order to ensure that East Boulder Unit Bargaining Unit employees will have the same rights
as other employees of the Company, the Company is entitled to consider eligible and qualified
bidders from the East Boulder Bargaining Unit.

	3.	 	East Boulder Bargaining Unit employees will be considered eligible and qualified if they meet
the qualifications provided for in Article 10, “Job Postings”, of the extant Agreement.

	4.	 	If an East Boulder Bargaining Unit employee is awarded a bargaining unit position in the
Columbus Facilities, that employee will accrue seniority in the Company’s Nye and Columbus
Bargaining Unit from the date of selection and will forfeit seniority rights in the East
Boulder Bargaining Unit.

The terms of this Memorandum of Agreement recite completely the agreement between the parties and
no oral modifications or interpretations are to be relied on between the Parties, except those
expressly provided for herein or by written modification hereof. This Memorandum of Understanding
will expire with the current Collective Bargaining Agreement.

 

 

Stillwater Mining Company,

East Boulder Operations

                                                            

Company Official

USW International Union, Local 11-0001,

East Boulder Unit

                                                            

Union Official

Signed
this                     day of                      , 2008.

 

 

Memorandum of Understanding

Between

Stillwater Mining Company

East Boulder Operation

AND

USW International Union, Local 11-0001

East Boulder Unit

Based on discussions through the negotiation of the Collective Bargaining Agreement (CBA), the
Company recognizes employee concerns with the East Boulder Hourly Incentive Systems (Incentive).
The Company will continue to communicate with employees and the Union on all aspects of the East
Boulder Hourly Incentive Systems.

The Company will not make Plan changes which on the average reduce the hourly incentive system(s)
unless mutually agreed upon with the Union. Structural changes within the incentive system(s) will
be discussed with the Union prior to implementation. Normally the Company will give the Workers’
Committee thirty (30) days advance notice of such changes and to the employees involved, one
incentive period prior to implementation. The Union will also be notified of any incidental or
administrative adjustments, which may become necessary throughout the CBA period.

The Company will administer the incentive systems. The Company and Union agree that the following
hourly incentive systems will continue at the East Boulder Mine:

	 	•	 	Miner and Diamond Driller Incentive System, No Change
	 
	 	•	 	Operational (Support) Incentive System, AMPR(aggregate miner pay rate) converted to
Total Tons Mined multiplied by dollar per ton rate($1.76/ton)
	 
	 	•	 	Concentrator Incentive System, No Change

The Safety Eligibility component shall continue to apply only to individuals separate from
Attendance Eligibility and will not affect others within the work group. Should the rolling three
month safety incident rate calculated within each incentive system above exceed MSHA’s incident
rate for Underground Metal/Non-Metal mines, this component may be subject to change.

Modifications, exclusive rates, or rate adjustments due to special or abnormal circumstances are
not subject to mutual agreement. Examples may include tunnel rehab, unique construction projects
or other infrequent or one time projects. This Memorandum of Understanding will expire with the
Current Collective Bargaining Agreement.

 

 

Stillwater Mining Company,

East Boulder Operations

                                                            

Company Official

USW International Union, Local 11-0001,

East Boulder Unit

                                                            

Union Official

Signed this                     day of                     , 2008.exv10w2

Exhibit 10.2

STILLWATER MINING COMPANY

2004 EQUITY INCENTIVE PLAN

(As Amended and Restated February 21, 2008)

     SECTION 1. Purposes. The purposes of this Stillwater Mining Company 2004 Equity
Incentive Plan, as may be amended from time to time (the “Plan”), are to promote the interests of
Stillwater Mining Company and its stockholders by (i) attracting and retaining personnel, including
executive and other key employees, consultants, and directors of the Company and its Affiliates, as
defined below, (ii) motivating such employees by means of performance-related incentives to achieve
longer-range performance goals, (iii) enabling such employees, consultants and directors to
participate in the long-term growth and financial success of the Company, and (iv) to permit the
payment of compensation that qualifies as performance-based compensation under Section 162(m) of
the Code. Notwithstanding any provision of the Plan, to the extent that any Award would be subject
to Section 409A of the Code, no such Award may be granted if it would fail to comply with the
requirements set forth in Section 409A of the Code and any regulations or guidance promulgated
thereunder.

     SECTION 2. Definitions. As used in the Plan, the following terms shall have the
meanings set forth below:

     “Affiliate” shall mean any entity that, directly or indirectly, is controlled by the Company
for purposes of Section 409A of the Code.

     “Alternative Award” shall mean an Award granted in tandem with, either at the same or a later
time as, another Award having substantially similar economic characteristics, the exercise of which
would result in the cancellation of such other Award.

     “Award” shall mean any Option, Stock Appreciation Right, Restricted Stock, or Other
Stock-Based Award.

     “Award Agreement” shall mean any written agreement, contract, or other instrument or document
evidencing any Award, which may, but need not, be executed or acknowledged by a Participant.

     “Board” shall mean the Board of Directors of the Company.

     “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.

     “Committee” shall mean (i) the Board, or (ii) a Committee of the Board designated by the Board
to administer the Plan and composed of not less than the minimum number of Persons from time to
time required by Rule 16b-3, each of whom, to the extent necessary to comply with 16b-3 only, is a
“Non-Employee Director” within the meaning of Rule 16b-3(b)(3)(i).

     “Company” shall mean Stillwater Mining Company, together with any successor thereto.

 

 

     “Consultant” shall mean any Person who is engaged by the Company or any Affiliate to render
consulting or advisory services as an independent contractor and is compensated for such services.

     “Covered Employee” shall have the meaning set forth in Section 162(m)(3) of the Code.

     “Employee” shall mean any employee of the Company or of any Affiliate.

     “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from time to time.

     “Fair Market Value” means, with respect to Shares or other property, the fair market value of
such Shares or other property determined by such methods or procedures as shall be established from
time to time by the Committee. Unless otherwise determined by the Committee in good faith, the
Fair Market Value of a Share as of a particular date shall mean, (i) the closing sales price of a
Share on the national securities exchange on which the Share is principally traded, for the last
preceding date on which there was a sale of such Share on such exchange, or (ii) if the Shares are
then traded in an over-the-counter market, the average of the closing bid and asked prices for the
Shares in such over-the-counter market for the last preceding date on which there was a sale of
such Shares in such market, or if the Shares are not then listed on a national securities exchange
or traded in an over-the-counter market, such value as the Committee, in its sole discretion, shall
determine in good faith.

     “Incentive Stock Option” shall mean an Option granted under Section 6(a) of the Plan that is
intended to meet the requirements of Section 422 of the Code or any successor provision thereto.

     “Non-Employee Director” (i) shall have the meaning set forth in Rule 16b-3(b)(3)(i) of the
Exchange Act, or any successor provision thereto, for purposes of the definition of “Committee” set
forth in the Plan, and (ii) shall mean a director who is not an Employee of the Company for all
other purposes, including, but not limited to, Section 6(a)(iv) of the Plan.

     “Non-Qualified Stock Option” shall mean an Option granted under Section 6(a) of the Plan that
is not intended to be an Incentive Stock Option.

     “Option” shall mean an Incentive Stock Option or a Non-Qualified Stock Option.

     “Other Stock-Based Award” shall mean any right granted under Section 6(d) of the Plan.

     “Participant” shall mean any Employee, Non-Employee Director or Consultant selected by the
Committee to receive an Award under the Plan.

     “Performance Goals” shall mean performance goals based on one or more of the following
criteria: (i) earnings including operating income, earnings before or after taxes, earnings before
or after interest, depreciation, amortization, or extraordinary or special items or book value per
share (which may exclude nonrecurring items); (ii) pre-tax income or after-tax income; (iii)
earnings per common share (basic or diluted); (iv) operating profit; (v) revenue, revenue growth or
rate of revenue growth; (vi) return on assets (gross or net), return on

2

 

investment, return on capital, or return on equity; (vii) returns on sales or revenues; (viii)
operating expenses; (ix) stock price appreciation; (x) cash flow, free cash flow, cash flow return
on investment (discounted or otherwise), net cash provided by operations, or cash flow in excess of
cost of capital; (xi) implementation or completion of critical projects or processes; (xii)
economic value created; (xiii) cumulative earnings per share growth; (xiv) operating margin or
profit margin; (xv) common stock price or total stockholder return; (xvi) cost targets, reductions
and savings, productivity and efficiencies; (xvii) strategic business criteria, consisting of one
or more objectives based on meeting specified market penetration, geographic business expansion,
customer satisfaction, employee satisfaction, human resources management, supervision of
litigation, information technology, and goals relating to acquisitions, divestitures, joint
ventures and similar transactions, and budget comparisons; (xviii) personal professional
objectives, including any of the foregoing performance goals, the implementation of policies and
plans, the negotiation of transactions, the development of long term business goals, formation of
joint ventures, research or development collaborations, and the completion of other corporate
transactions; and (xix) any combination of, or a specified increase in, any of the foregoing.
Where applicable, the Performance Goals may be expressed in terms of attaining a specified level of
the particular criteria or the attainment of a percentage increase or decrease in the particular
criteria, and may be applied to one or more of the Company, a Subsidiary or Affiliate, or a
division or strategic business unit of the Company, or may be applied to the performance of the
Company relative to a market index, a group of other companies or a combination thereof, all as
determined by the Committee. The Performance Goals may include a threshold level of performance
below which no payment will be made (or no vesting will occur), levels of performance at which
specified payments will be made (or specified vesting will occur), and a maximum level of
performance above which no additional payment will be made (or at which full vesting will occur).
Each of the foregoing Performance Goals shall be determined in accordance with generally accepted
accounting principles and shall be subject to certification by the Committee; provided that the
Committee shall have the authority to make equitable adjustments to the Performance Goals in
recognition of unusual or non-recurring events affecting the Company or any Subsidiary or Affiliate
or the financial statements of the Company or any Subsidiary or Affiliate, in response to changes
in applicable laws or regulations, or to account for items of gain, loss or expense determined to
be extraordinary or unusual in nature or infrequent in occurrence or related to the disposal of a
segment of a business or related to a change in accounting principles.

     “Person” shall mean any individual, corporation, partnership, association, joint-stock
company, trust, unincorporated organization, government or political subdivision thereof or other
entity.

     “Restricted Period” shall mean the period of time selected by the Committee (as may be amended
by the Committee from time to time) during which a grant of Restricted Stock may be forfeited to
the Company.

     “Restricted Stock” shall mean any Share granted under Section 6(c) of the Plan.

     “Rule 16b-3” shall mean Rule 16b-3 as promulgated by the SEC under the Exchange Act, or any
successor rule or regulation thereto as in effect from time to time.

3

 

     “SEC” shall mean the Securities and Exchange Commission, or any successor thereto and shall
include the staff thereof.

     “Shares” shall mean the common shares of the Company, $0.01 par value, or, following an
adjustment under Section 4(c) of the Plan, such other securities or property as may become subject
to Awards in substitution for such common shares pursuant to such adjustment.

     “Stock Appreciation Right” shall mean any right granted under Section 6(b) of the Plan.

     “Subsidiary” means any corporation in an unbroken chain of corporations beginning with the
Company if, at the time of granting of an Award, each of the corporations (other than the last
corporation in the unbroken chain) owns stock possessing 50% or more of the total combined voting
power of all classes of stock in one of the other corporations in the chain.

     SECTION 3. Administration.

     (a) Authority of Committee. The Plan shall be administered by the Committee. In no
event, however, shall the Committee modify the distribution terms in any Award or Award Agreement
that has a feature for the deferral of compensation if such modification would result in taxes,
additional interest and/or penalties pursuant to Section 409A of the Code.. Subject to the terms of
the Plan and applicable law, and in addition to other express powers and authorizations conferred
on the Committee by the Plan, the Committee shall have full power and authority to: (i) designate
Participants; (ii) determine the type or types of Awards to be granted to eligible Participants;
(iii) determine the number of Shares to be covered by, or with respect to which payments, rights,
or other matters are to be calculated in connection with, Awards; (iv) determine the terms and
conditions (including Performance Goals) of any Award; (v) determine Performance Goals no later
than such time as is required to ensure that an underlying Award which is intended to comply with
the requirements of Section 162(m) of the Code so complies; (vi) determine whether, to what extent,
and under what circumstances Awards may be settled or exercised in cash, Shares, other securities,
other Awards or other property, or cancelled, forfeited, or suspended and the method or methods by
which Awards may be settled, exercised, cancelled, forfeited, or suspended; (vii) determine
whether, to what extent, and under what circumstances cash, shares, other securities, other Awards,
other property, and other amounts payable with respect to an Award shall be deferred either
automatically or at the election of the holder thereof or of the Committee; (viii) interpret and
administer the Plan and any instrument or agreement relating to, or Award made under, the Plan;
(ix) establish, amend, suspend, or waive such rules and regulations and appoint such agents as it
shall deem appropriate for the proper administration of the Plan; and (x) make any other
determination and take any other action that the Committee deems necessary or desirable for the
administration of the Plan.

     (b) Determinations Under the Plan. Unless otherwise expressly provided in the Plan all
designations, determinations, interpretations, and other decisions under or with respect to the
Plan or any Award shall be within the sole discretion of the Committee, may be made at any time and
shall be final, conclusive, and binding upon all Persons, including the Company, any Affiliate, any
Participant, any holder or beneficiary of any Award, any shareholder and any Employee.

4

 

     SECTION 4. Shares Available For Awards.

     (a) Shares Available. Subject to adjustment as provided in Section 4(c), the number of
Shares with respect to which Awards may be granted under the Plan shall be 5,250,000. If, after the
effective date of the Plan (as described in Section 9), any Shares covered by an Award granted
under the Plan, or to which such an Award relates, are forfeited, or if an Award otherwise
terminates or is cancelled without the delivery of Shares or of other consideration, then the
Shares covered by such Award, or to which such Award relates, or the number of Shares otherwise
counted against the aggregate number of Shares with respect to which Awards may be granted, to the
extent of any such forfeiture, termination or cancellation, shall again be, or shall become, to the
extent permissible under Rule 16b-3, Shares with respect to which Awards may be granted.

     (b) Annual Limit on Awards to an Individual. Subject to adjustment as provided in
Section 4(c), the number of Shares subject to Awards that are granted to any one individual in a
single calendar year may not exceed 250,000. Determinations made in respect of the limitation set
forth in the preceding sentence shall be made in a manner consistent with Section 162(m) of the
Code.

     For Incentive Stock Options granted under the Plan, the aggregate Fair Market Value
(determined as of the date of grant) of the number of whole Shares with respect to which Incentive
Stock Options are exercisable for the first time during any calendar year under all plans of the
Company shall not exceed $100,000, or such other amount as determined under Section 422 of the
Code.

     (c) Adjustments. In the event that the Committee determines that any dividend or other
distribution (whether in the form of cash, Shares, other securities, or other property),
recapitalization, stock split, reverse stock split, reorganization, merger, consolidation,
split-up, spin-off, combination, repurchase, or exchange of Shares or other securities of the
Company, issuance of warrants or other rights to purchase Shares or other securities of the
Company, or other similar corporate transaction or event affects the Shares such that an adjustment
is necessary in order to prevent dilution or enlargement of the benefits or potential benefits
intended to be made available under the Plan, then the Committee shall adjust any or all of (i) the
number of Shares or the kind of equity securities of the Company (or number and kind of other
securities or property) with respect to which Awards may be granted, both in the aggregate and in
one calendar year to an individual, (ii) the number of Shares or the kind of equity securities of
the Company (or number and kind of other securities or property) subject to outstanding Awards,
(iii) the grant or exercise price with respect to any Award or, if deemed appropriate, make
provision for a cash payment to the holder of an outstanding Award, and (iv) the Performance Goals;
provided, in each case, that with respect to Awards of Incentive Stock Options no such adjustment
shall be authorized to the extent that such authority would cause the Plan or the Awards of
Incentive Stock Options to fail to comply with Section 422 of the Code, as from time to time
amended and provided further, that the number of Shares subject to any Award denominated in Shares
shall always be a whole number, and provided further that no such adjustment shall cause any Award
hereunder which is or becomes subject to Section 409A of the Code to be considered a new Award or a
modification of such Award for purposes of Section 409A of the Code.

5

 

     (d) Sources of Shares Deliverable For Awards. Any Shares delivered pursuant to an
Award may consist, in whole or in part, of authorized and unissued Shares or of treasure Shares.

     SECTION 5. Eligibility. Employees, Non-Employee Directors and Consultants of the
Company or any Affiliate shall be eligible to be designated as Participants.

     SECTION 6. Awards.

     (a) Options.

     (i) Grant. Subject to the provisions of the Plan, the Committee shall have
authority to determine the Participants to whom options shall be granted, the number of
Shares to be covered by each Option, the option price therefore and the conditions and
limitations applicable to the exercise of the Option. The Committee shall have the authority
to grant Incentive Stock Options, or to grant Non-Qualified Stock Options, or to grant both
types of options; provided, however, that Incentive Stock Options may only be granted to
Employees. In the case of Incentive Stock Options, the terms and conditions of such grants
shall be subject to, and comply with, the requirements of Section 422 of the Code, as from
time to time amended. Any Option or a portion thereof that is designated as an Incentive
Stock Option that for any reason fails to meet the requirements of an Incentive Stock Option
shall be treated hereunder as a Non-Qualified Stock Option.

     (ii) Exercise Price. The Committee shall establish the exercise price at the
time each Option is granted, which price shall not be less than 100% of the per share Fair
Market Value of the Shares on the date of grant. If an Employee owns or is deemed to own (by
reason of the attribution rules applicable under Section 424(d) of the Code) more than 10%
of the combined voting power of all classes of stock of the Company and an Incentive Stock
Option is granted to such Employee, the option price shall be no less than 110% of the Fair
Market Value of the Shares on the date of grant.

     (iii) Exercise. Each Option shall be exercisable at such times and subject to
such terms and conditions as the Committee may specify in the applicable Award Agreement or
thereafter. The Committee may impose such conditions with respect to the exercise of
Options, including without limitation, any relating to the application of Federal or state
securities laws, as it may deem necessary or advisable.

     (b) Stock Appreciation Rights.

     (i) Grant. Subject to the provisions of the Plan, the Committee shall have
authority to determine the Participants to whom Stock Appreciation Rights shall be granted,
the number of Shares to be covered by each Stock Appreciation Right Award, the grant price
thereof and the conditions and limitations applicable to the exercise thereof. A Stock
Appreciation Right may be granted in tandem with another Award, in addition to another
Award, or freestanding and unrelated to another Award. A stock Appreciation Right granted in
tandem with or in Addition to another Award may be granted either at the same time as such
other Award or at a later time. A Stock Appreciation Right shall not be exercisable earlier
than six months after grant, unless otherwise determined by the Committee, and shall have a per share grant price of not
less than 100% of the per share Fair Market Value of the Shares on the date of grant.

6

 

     (ii) Exercise and Payment. A Stock Appreciation Right shall entitle the
Participant to receive with respect to each Share covered by such Stock Appreciation Right
an amount equal to the excess of the Fair Market Value of a Share on the date of exercise of
the Stock Appreciation Right over the per share grant price thereof, provided that the
Committee may, for administrative convenience, determine that the exercise of any Stock
Appreciation Right, which is not related to an Incentive Stock Option and which can only be
exercised for cash during limited periods of time in order to satisfy the conditions of
certain rules of the SEC, shall be deemed to occur for all purposes hereunder on the day
during such limited period on which the Fair Market Value of the Shares is the highest. Any
such determination by the Committee may be changed by the Committee from time to time and
may govern the exercise of Stock Appreciation Rights granted prior to such determination as
well as Stock Appreciation Rights thereafter granted.

     (iii) Other Terms and Conditions. Subject to the terms of the Plan and any
applicable Award Agreement, the Committee shall determine, at or after the grant of a Stock
Appreciation Right, the term, methods of exercise, methods and form of settlement, and any
other terms and conditions of any Stock Appreciation Right. Any such determination by the
Committee may be changed by the Committee from time to time and may govern the exercise of
Stock Appreciation Rights granted or exercised prior to such determination as well as Stock
Appreciation Rights granted or exercised thereafter. The Committee may impose such
conditions or restrictions on the exercise of any Stock Appreciation Right as it shall deem
appropriate.

     (c) Restricted Stock.

     (i) Grant. Subject to the provisions of the Plan, the Committee shall have
authority to determine the Participants to whom Restricted Stock shall be granted, to each
such Participant, the duration of the Restricted Period during which, and the conditions
under which, the Restricted Stock may be forfeited to the Company, and the other terms and
conditions of such Awards. The vesting of a Restricted Stock Award granted under the Plan
may be conditioned upon the completion of a specified period of employment or service with
the Company or any Subsidiary or Affiliate, upon the attainment of specified Performance
Goals, and/or upon such other criteria as the Committee may determine in its sole
discretion. Unless otherwise determined by the Committee, Restricted Stock Awards shall
provide for the payment of dividends. Dividends paid on Restricted Stock may be paid
directly to the Participant and may be subject to risk of forfeiture and/or transfer
restrictions during any period established by the Committee, or may be reinvested in
additional Shares of Restricted Stock all as determined by the Committee in its discretion.

     (ii) Transfer Restrictions. During the Restricted Period, Restricted Stock
will be subject to the limitations on transfer as provided in Section 8(g)(iii).

7

 

     (d) Other Stock-Based Awards. The Committee shall have authority to determine the
Participants who shall receive an “Other Stock-Based Award,” which shall consist of a right (i)
which is other than an Award or right described in Section 6(a), (b), or (c) above and (ii) which
is denominated or payable in, valued in whole or in part or by reference to, or otherwise based on
or related to, Shares (including, without limitation, securities convertible into Shares), deemed
by the Committee to be consistent with the purposes of the Plan; provided, that any such right must
comply, to the extent deemed desirable by the Committee, with Rule 16b-3, and provided, further,
that any such right must not result in taxes, additional interest and/or penalties pursuant to
Section 409A of the Code. Without limiting the generality of the preceding sentence, if any Other
Stock-Based Award is subject to Section 409A of the Code, any payment or benefits otherwise due
thereunder to any Participant upon the Participant’s termination of employment or consultancy or
other service with the Company shall not be made until and unless such termination constitutes a
“separation from service,” as such term is defined under Section 409A of the Code, and if at the
time of such separation from service with the Company the Participant is a “specified employee” as
defined in Section 409A of the Code and the deferral of the commencement of any payments or
benefits otherwise payable thereunder as a result of such separation from service is necessary in
order to prevent any accelerated or additional tax under Section 409A of the Code, then the Company
will defer the commencement of the payment of any such payments or benefits thereunder (without any
reduction in such payments or benefits ultimately paid or provided to the Participant) until the
date that is six months following the Participant’s separation from service with the Company (or
the earliest date permitted under Section 409A of the Code). Subject to the terms of the Plan and
any applicable Award Agreement, the Committee shall determine the terms and conditions of any such
other Stock-Based Award, including Performance Goals and performance periods. Except in the case of
an Other Stock-Based Award that is an Alternative Award and subject to Section 6(e)(viii), the
price at which securities may be purchased pursuant to any Other Stock-Based Award granted under
this Plan, or the provision, if any, of any such Award that is analogous to the purchase or
exercise price, shall not be less than 100% of the Fair Market Value of the security to which such
Award relates on the date of the grant.

     (e) General.

     (i) Awards May Be Granted Separately or Together. Awards may, in the
discretion of the Committee, be granted either alone or in addition to, in tandem with, or
in substitution for, any other Award granted under the Plan. Awards granted in addition to,
or in tandem with, other Awards may be granted either at the same time as, or at a different
time from, the grant of such other Awards.

     (ii) Forms of Payment by Company Under Awards. Subject to the terms of the
Plan and of any applicable Award Agreement, payments or transfers to be made by the Company
or an Affiliate upon the grant, exercise or payment of an Award may be made in such form or
forms as the Committee shall determine, including, without limitation, cash, Shares, other
securities, other Awards or other property, or any combination thereof, and may be made in a
single payment or transfer, in installments, or on a deferred basis, in each case in
accordance with rules and procedures established by the Committee.

8

 

     (iii) Limits on Transfer of Awards. Awards (other than Incentive Stock
Options) shall be transferable to the extent provided in any Award Agreement. Incentive
Stock Options may not be sold, pledged, assigned, hypothecated, transferred or disposed if
in any manner other than by will or by the laws of descent or distribution and may be
exercised, during the lifetime of the Participant, only by the Participant; provided,
however, that the Participant may designate a beneficiary of the Participant’s Incentive
Stock Option in the event of the Participant’s death on a beneficiary designation form
provide by the Company.

     (iv) Term of Awards. The term of each Award shall be for such period as may be
determined by the Committee; provided, that in no event shall the term of any Option exceed
a period of ten years from the date of its grant.

     (v) Share Certificates. All certificates for Shares or other securities of the
Company or any Affiliate delivered under the Plan pursuant to any Award, or the exercise
thereof, shall be subject to such stop transfer orders and other restrictions as the
Committee may deem advisable under the Plan or the rules, regulations, and other
requirements of the SEC, any stock exchange upon which such Shares or other securities are
then listed, and any applicable Federal or state laws, and the Committee may cause a legend
or legends to be put on any such certificates to make appropriate reference to such
restrictions. The Committee may require that, during the Restricted Period, a certificate
for Shares of Restricted Stock registered in the name of a Participant shall be deposited by
such Participant, together with a stock power endorsed in blank, with the Company.

     (vi) Consideration for Grants. Awards may be granted for no cash consideration
or for such minimal cash consideration as may be required by applicable law.

     (vii) Delivery of Shares or Other Securities and Payment by Participant of
Consideration. No Shares or other securities shall be delivered pursuant to any Award
until payment in full or any amount required to be paid pursuant to the Plan or the
applicable Award Agreement is, or is arranged to be, received by the Company. Such payment
may be made by such method or methods and in such form or forms as the Committee shall
determine, including, without limitation, cash, Shares, other securities, other Awards or
other property, or any combination thereof; provided that the combined value, as determined
by the Committee, of all cash and cash equivalents and the Fair Market Value of any such
Shares or other property so tendered, or arranged to be tendered, to the Company, as of the
date of such tender, is at least equal to the full amount required to be paid pursuant to
the Plan or the applicable Award Agreement to the Company.

     (viii) Prohibition on Repricing. Notwithstanding any other provision of this
Plan, in no event may the exercise price under any Option be reduced, other than pursuant to
an adjustment contemplated in Section 4(c), after it is granted, either directly or by
cancellation of an outstanding option in return for a newly granted option or other Award
(including an Alternative Award) that has the effect of lowering the exercise price of the
option.

9

 

     SECTION 7. Amendment And Termination. Except to the extent prohibited by applicable
law and unless otherwise expressly provided in an Award Agreement or in the Plan:

     (a) Amendments to the Plan. The Board may amend, alter, suspend, discontinue, or
terminate the Plan at any time without the consent of any shareholder, Participant, other holder or
beneficiary of an Award, or other Person; provided that notwithstanding any other provision of the
Plan or any Award agreement, no such amendment, alteration, suspension, discontinuation, or
termination shall be made without shareholder approval if such approval is necessary to comply
with, or to obtain exemptive relief under, any tax or regulatory requirement that the Board deems
desirable to comply with, or obtain exemptive relief under, including for these purposes any
approval requirement which is a prerequisite for exemptive relief from Section 16(b) of the
Exchange Act. Notwithstanding anything to the contrary herein, the Committee may amend the Plan in
such a manner as may be necessary so as to have the Plan conform with local rules and regulations
in any jurisdiction outside the United States.

     (b) Amendments to Awards. The Committee may waive any conditions or rights under,
amend any terms of, or accelerate or alter, any Award theretofore granted, prospectively or
retroactively, without the consent of any relevant Participant or holder or beneficiary of an
Award, provided that such action does not (i) materially impair the rights of any Participant or
holder or beneficiary of an Award without such person’s consent, or (ii) result in a decrease in
the Fair Market Value of an Award without such Participant’s or holder’s or beneficiary’s consent.
Notwithstanding anything to the contrary herein, in no event shall the Committee amend the
distribution terms in any Award or Award Agreement that has a feature for the deferral of
compensation if such amendment would result in taxes, additional interest and/or penalties pursuant
to Section 409A of the Code..

     (c) Adjustments of Awards Upon Certain Acquisitions. In the event the Company or any
Affiliate shall assume outstanding Awards or the right or obligation to make future Awards in
connection with the acquisition of another business or another corporation or business entity, the
Committee may make such adjustments, not inconsistent with the terms of the Plan, in the terms of
Awards as it shall deem appropriate in order to achieve reasonable comparability or an equitable
relationship between the assumed Awards and the Awards as so adjusted, provided, however, that such
adjustment does not result in such awards being considered new awards or modifications of such
awards for purposes of Section 409A of the Code..

     (d) Adjustment of Awards Upon the Occurrence of Certain Unusual or Nonrecurring
Events. The Committee is hereby authorized to make adjustments in the terms and conditions of,
and the criteria included in, Awards in recognition of unusual or nonrecurring events (including,
without limitation, the events described in Section 4(c) hereof) affecting the Company, an
Affiliate, or the financial statements of the Company or any Affiliate, or of changes in applicable
laws, regulations, or accounting principles, whenever the Committee determines that such
adjustments are appropriate in order to prevent dilution or enlargement of the benefits or
potential benefits intended to be made available under the Plan, provided, however, that such
adjustment does not result in taxes, additional interest and/or penalties pursuant to Section 409A
of the Code..

10

 

     (e) Correction of Defects, Omissions and Inconsistencies. The Committee may correct
any defect, supply any omission, or reconcile any inconsistency in the Plan or any Award or Award
Agreement in the manner and to the extent it shall deem desirable to carry the Plan into effect.

     (f) Cancellation. Any provision of this Plan or any Award Agreement other than Section
6(e)(viii) hereof to the contrary notwithstanding, the Committee may cause any Award granted
hereunder to be cancelled in consideration of a cash payment or alternative award (equal to the
Fair Market Value of the Award to be cancelled) made to the holder of such cancelled Award.

     SECTION 8. General Provisions.

     (a) No Rights to Awards. No Employee, Participant or other Person shall have any claim
to be granted any Award, and there is no obligation for uniformity of treatment of Employees,
Participants, or holders or beneficiaries of Awards. The terms and conditions of Awards need not be
the same with respect to each recipient.

     (b) Delegation. Subject to the terms of the Plan and applicable law, the Committee may
delegate to one or more officers or managers of the Company or any Affiliate, or to a Committee of
such officers or managers, the authority, subject to such terms and limitations as the Committee
shall determine, to grant Awards to, or to cancel, modify or waive rights with respect to, or to
alter, discontinue, suspend, or terminate Awards held by, Employees who are not officers or
directors of the Company for purposes of Section 16 of the Exchange Act, or any successor section
thereto, or who are otherwise not subject to such section.

     (c) Withholding. A participant may be required to pay to the Company or any Affiliate,
and the Company or any Affiliate shall have the right and is hereby authorized to withhold from any
Award, from any payment due or transfer made under any Award or under the Plan or from any
compensation or other amount owing to a Participant, the amount (in cash, Shares, other securities,
other Awards or other property) of any applicable withholding taxes in respect of an Award, its
exercise, or any payment or transfer under an Award or under the Plan and to take such other action
as any be necessary in the opinion of the Company to satisfy all obligations for the payment of
such taxes. In the case of payments of Awards in the form of Shares, at the Committee’s discretion
the Participant may be required to pay to the Employer the amount of any taxes required to be
withheld with respect to such Shares or, in lieu thereof, the Employer shall have the right to
retain (or the Participant may be offered the opportunity to elect to tender) the number of Shares
whose Fair Market Value equals the amount required to be withheld. The Committee may provide for
additional cash payments to holders of Awards to defray or offset any tax arising from the grant,
vesting, exercise or payments of any Award. In the discretion of the Committee, and subject to
applicable law, the Company may offer loans to Participants to satisfy withholding requirements on
such terms as the Committee may determine, which terms may in the discretion of the Committee be
non-interest bearing. Other provisions of the Plan notwithstanding, only the minimum amount of
Shares deliverable in connection with an Award necessary to satisfy statutory withholding
requirements will be withheld, unless withholding of any additional amount of Shares will not
result in additional accounting expense to the Company.

11

 

     (d) Award Agreements. Each Award hereunder shall be evidenced by an Award Agreement,
which shall be delivered to the Participant and shall specify the terms and conditions of the Award
and any rules applicable thereto, including but not limited to the effect on such Award of the
death, retirement or other termination of employment or service of a Participant and the effect, if
any, of a change in control of the Company.

     (e) No Limit on Other Compensation Arrangements. Nothing contained in the Plan shall
prevent the Company or any Affiliate from adopting or continuing in effect other compensation
arrangements, which may (but need not) provide for the grant of options, restricted stock and other
types of security-based awards provided for hereunder (subject to shareholder approval if such
approval is required), and such arrangements may be either generally applicable or applicable only
in specific cases.

     (f) No Right to Employment. The grant of an Award shall not be construed as giving a
Participant the right to be retained in the employ of the Company or any Affiliate. Further, the
Company or an Affiliate may at any time dismiss a Participant from employment, free from any
liability or any claim under the Plan, except to the extent expressly provided otherwise in the
Plan or in any Award Agreement.

     (g) No Rights as Stockholder. Subject to the provisions of the applicable Award
Agreement, no Participant or holder or beneficiary of any Award shall have any rights as a
stockholder with respect to any Shares to be distributed under the Plan until he or she has become
the holder of such Shares. Notwithstanding the foregoing, in connection with each grant of
Restricted Stock hereunder, the applicable Award shall specify if, and to what extent, the
Participant shall not be entitled to the rights of a stockholder in respect of such Restricted
Stock.

     (h) Governing Law. The validity, construction, and effect of the Plan and any rules
and regulations relating to the Plan and any Award Agreement shall be determined in accordance with
the laws of the State of Delaware and applicable Federal law.

     (i) Severability. If any provision of the Plan or any Award is or becomes or is deemed
to be invalid, illegal, or unenforceable in any jurisdiction or as to any Person or Award, or would
disqualify the Plan or any Award under any law deemed applicable by the Committee, such provision
shall be construed or deemed amended to conform to applicable laws, or if it cannot be construed or
deemed amended without, in the determination of the Committee, materially altering the intent of
the Plan or the Award, such provision shall be stricken as to such jurisdiction, Person or Award
and the remainder of the Plan and any such Award shall remain in full force and effect.

     (j) Other Laws. The Committee may refuse to issue or transfer any Shares or other
consideration under an Award if it determines that the issuance or transfer of such Shares or such
other consideration might violate any applicable law or regulation or entitle the Company to
recover the same under Section 16(b) of the Exchange Act, and any payment tendered to the Company
by a Participant, other holder or beneficiary in connection with the exercise of such Award shall
be promptly refunded to the relevant Participant, holder or beneficiary. Without limiting the
generality of the foregoing, no Award granted hereunder shall be construed as an offer to sell
securities of the Company, and no such offer shall be outstanding, unless and until
the Committee has determined that any such offer, if made, would be in compliance with all
applicable requirements of Federal securities laws.

12

 

     (k) No Trust or Fund Created. Neither the Plan nor any Award shall create or be
construed to create a trust or separate fund of any kind or a fiduciary relationship between the
Company or any Affiliate and a Participant or any other Person. To the extent that any Person
acquires a right to receive payments from the Company or any Affiliate pursuant to an Award, such
right shall be no greater than the right of any unsecured general creditor of the Company or any
Affiliate.

     (l) No Fractional Shares. No fractional Shares shall be issued or delivered pursuant
to the Plan or any Award, and the Committee shall determine whether cash, other securities, or
other property shall be paid or transferred in lieu of any fractional Shares or whether such
fractional Shares or any rights thereto shall be cancelled, terminated, or otherwise eliminated.

     (m) Headings. Headings are given to the sections and subsections of the Plan solely as
a convenience to facilitate reference. Such headings shall not be deemed in any way material or
relevant to the construction or interpretation of the Plan or any provision thereof.

     SECTION 9. Effective Date Of The Plan. The Plan was effective as of April 29, 2004
(the date of its approval by the shareholders of the Company).

     SECTION 10. Term Of The Plan. No Award shall be granted under the Plan after the tenth
anniversary of the effective date of the Plan. Unless otherwise expressly provided in the Plan or
in an applicable Award Agreement, and Award theretofore granted may, and the authority of the Board
or the Committee to amend, alter, adjust, suspend, discontinue, or terminate any such Award or to
waive any conditions or rights under any such Award shall, extend beyond such date.

13

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