Document:

exv10w1

 

Exhibit 10.1

	 	 	 
	Idenix Pharmaceuticals, inc.
	 	 
	 
	 	 
	One Kendall Square

	 	Main Tel: 617.995.9800
	Building 1400

	 	Main Fax: 617.995.9030
	Cambridge MA 02139

	 	www.idenix.com

January 4, 2007

CONFIDENTIAL

Douglas L. Mayers, M.D.

9 Oak Ridge Drive

Newtown, Connecticut 06470

Dear Doug:

On behalf of Idenix Pharmaceuticals, Inc. (“Idenix”), I am pleased to offer you the position
of Executive Vice President and Chief Medical Officer, reporting directly to me as Chief
Executive Officer and Chairman of the Board. The terms of your employment are set forth below.

	1.	 	Commencement; Your employment will commence on January 22nd, 2007. Upon
commencement of your employment, you may expect that the Board will elect you as an
executive officer of Idenix and that you will be thereafter an “officer” of Idenix within
the meaning of Rule 16a-1 (f) under the Securities Exchange Act and an “executive
officer” within the meaning of Rule 3b-7 under the Exchange Act.
	 
	2.	 	Base Salary: Your semi-monthly salary will be $12,500 (equivalent to an annual
rate of $300,000), subject to applicable withholding and payable in accordance with
normal payroll practices of Idenix. The Base Salary shall be reviewed annually for
additional increases, if any, which is the sole discretion of the Idenix Board of
Directors. After any such increase, the term “Base Salary” as utilized herein shall
thereafter refer to the increased amount. Base Salary shall not be reduced at any time
without your express prior written consent.
	 
	3.	 	Equity: As soon as practicable following the commencement of your employment,
the Company will recommend to its Board of Directors that you be granted, pursuant to the
2005 Idenix Pharmaceuticals, Inc. Stock Incentive Plan, options to purchase 100,000
shares of Idenix’s common stock. The exercise price of such option will be the current
fair market value of Idenix’s common stock on the date of grant. Except as otherwise
contemplated and provided by paragraph 9 hereof, the option will vest ratably over a
48-month period beginning on the last day of the month in which your employment
commences. In addition, you shall have annual performance targets and opportunities to be
awarded additional equity awards and incentives. Such awards may include stock options,
restricted stock grants and other equity linked incentives. The actual type of award and
number of shares to be awarded under such target equity opportunity shall be subject to
annual approval by the Board and conditioned upon the achievement of annual performance
targets established by the Board. Currently, it is anticipated that the target equity
award would be comprised of an annual grant of options to purchase 40,000 shares of
Idenix’s common stock on terms and conditions with respect to exercise price and vesting
substantially similar to the initial “new hire” grant described above.

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	4.	 	Benefits: Upon the commencement of your employment, you will be eligible to
participate in all benefit plans Idenix provides generally to its senior level executives,
subject to, and on a basis consistent with, the participation requirements and other terms and
conditions of such plans and programs. Such programs currently include medical, dental,
disability, life insurance and a 401(k) plan. You will be eligible to accrue four weeks of
vacation per calendar year and such vacation carryover as is set forth in the policy approved
by the Board.
	 
	5.	 	Location: This position is based at Idenix’ offices in Cambridge, Massachusetts.
	 
	6.	 	Relocation: In connection with your relocation to the Cambridge, Massachusetts area,
Idenix will provide you relocation assistance in the type and amount offered to other Idenix
senior level executives. Such assistance includes amounts required to gross up the aggregate
of all the foregoing to offset any related additional income tax liabilities. Idenix’s
obligation to make the payments contemplated by this paragraph 6 will terminate on the
2nd anniversary of your employment commencement.
	 
	7.	 	Sign-on Bonus: In connection with your commencement of employment, Idenix will pay to
you within the first 30 days of your employment, a lump sum amount of $300,000. Such amount
will be included and reported as bonus income on 2007 Form W-2 and will be subject to
applicable withholding taxes. You agree that if you voluntarily terminate your employment with
Idenix or are terminated by Idenix for cause during the 12 month period immediately following
the commencement of your employment such amount will be repayable in whole or part to Idenix.
Specifically, if you voluntarily terminate your employment or Idenix terminates your
employment for cause on or prior to the 3st anniversary of your employment
commencement, you will be liable for repayment of 100% of such amount.
	 
	8.	 	Incentive based compensation: In your role as Executive Vice President, you are
eligible for an annual target cash bonus (“Target Bonus”) equal to 50% of your Base Salary.
The actual cash bonus may range from 0% to a maximum aggregate amount of 200% of the target
bonus. Your Target Bonus as a percentage of Base Salary may, at the discretion of the Board,
be periodically reviewed for increase. After any such increase, the term “Target Bonus” as
used herein shall thereafter refer to the increased amount. The Target Bonus shall not be
reduced at any time without your express prior written consent.
	 
	9.	 	Termination: You and Idenix each agree that your employment with Idenix is that of an
employee at will. Both you and Idenix have the right to terminate your employment at any time
for any or no reason, subject to the consequences provided herein.

	A)	 	In the event Idenix terminates your employment for reasons other than Cause (as defined in
	 
	 	 	Appendix A hereto), or you terminate your employment for Good Reason (as defined on
Appendix A hereto), you will be entitled to receive the following:

	 	1.	 	Lump sum payment equivalent to one year of Base Salary and the greater of: (i)
the Target Bonus; or (ii) the bonus you earned in the year preceding the year in which
the termination of your employment occurs, less any and all applicable taxes and
withholdings;
	 
	 	2.	 	Immediate vesting and exercisability of all outstanding equity awards; and

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	 	3.	 	Provided you timely elect and remain eligible for benefits continuation pursuant
to the federal “COBRA” laws, continued payment by Idenix of premiums for you (and your
covered dependents) under the group health, dental, disability and life insurance
coverage at the active employee rates for a period of 12 months subsequent to the date
of your termination. Any such payments and related coverage shall be discontinued in
the event that you obtain substantially equivalent substitute coverage from another
employer or provider during such 12 month period.

	B)	 	Termination Within One Year After a Change in Control. If your employment is terminated by
Idenix (or any successor to Idenix) without Cause or you terminate your employment for Good
Reason, in each case within one (1) year following a Change in Control (as defined in
Appendix A hereto) in addition to the payments, benefits and entitlements provided pursuant
to Paragraph 9A hereof, you shall also be entitled to an additional lump-sum amount
equivalent to one year of Base Salary and the greater of your Target Bonus or the actual
bonus for the year preceding the year in which termination of employment occurs, payable as
soon as practicable following the termination of employment.

	 	1.	 	Excise Tax Provision. Anything herein to the contrary
notwithstanding, to the extent that any payment, entitlement or benefit provided
under this Agreement or any other agreement, plan, policy, program or arrangement of
the Company (the “Payments”) would be subject to the imposition of the excise tax
imposed under Section 4999 of the Interna] Revenue Code of 1986, as amended (the
“Code”), or any similar Federal or state law (an “Excise Tax”), the Payments shall
be reduced (but not below zero) to the maximum amount as will result in no portion
of the Payments being subject to such Excise Tax (the “Safe Harbor Cap”), but only
if the net after-tax amount that would be received by the Employee, taking into
account all applicable Federal, state and local income taxes and the imposition of
the Excise Tax, is greater than the net after-tax amount, similarly determined, that
would be received by the Employee if Payments are not reduced to the Safe Harbor
Cap. Unless the Employee has given prior written notice specifying a different order
to the Company to effectuate the reductions described in the preceding sentence, the
Company shall reduce or eliminate the Payments to the Safe Harbor Cap, by first
reducing or eliminating those payments or benefits which are not payable in cash and
then by reducing or eliminating cash payments. Any notice given by the Employee
pursuant to the preceding sentence shall take precedence over the provisions of any
other plan, arrangement or agreement governing the Employee’s rights and
entitlements to any benefit, entitlement or compensation.

	C)	 	The obligation of Idenix to make the payments and provide the benefits described in paragraph A
and B above are conditioned upon the execution, delivery and honor by you of a release of
claims upon the termination of your employment. The form of waiver and release of claims is
set forth as Appendix B to this letter. In addition, in exchange for the payments
and benefits described above you agree that for a period of one year following the
termination of employment, you shall not, without express prior written approval of Idenix,
directly or indirectly, knowingly solicit any employee of Idenix or any of its affiliates,
to leave the employ of such entity.
	 
	10.	 	Section 409 A Treatment: If any payment, compensation or other benefits provided
to you in connection with your employment termination is determined, in whole or in part,
to constitute “nonqualified deferred compensation” within the meaning of Section 409A of
the Code and you

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	 	 	are a specified employee as defined in Section 409A(2)(B)(i), no part of such payments shall
be paid before the day that is six (6) months plus one (1) day after the date of termination
(the “New Payment Date”) if necessary to avoid adverse treatment under Section 409A of the
Code. The aggregate of any payments that otherwise would have been paid to you during the
period between the date of termination and the New Payment Date shall be paid to you in a
lump sum on such New Payment Date. Thereafter, any payments that remain outstanding as of
the day immediately following the New Payment Date shall be paid without delay over the time
period originally scheduled, in accordance with the terms of this letter agreement.
	 
	11.	 	Disclosure of Inventions: This offer is conditioned on your agreement, that as
an employee of Idenix, you will make full and prompt disclosure to Idenix of all inventions,
improvements, modifications, discoveries, creations, methods, processes and developments which
are created, made, or reduced to practice by you alone, under your direction or with others in
connection with or relating to Idenix’s then present or planned business or research and
development activities during the term of your employment, whether or not such developments
are patentable or protected as confidential information, and whether or not such developments
are made or conceived during normal working hours or on or off the premises of Idenix (all of
which are hereinafter collectively termed “Developments”).
	 
	12.	 	 Assignment of Inventions: By your acceptance of this offer of employment, you
agree to assign and do hereby assign to Idenix all your title, interests and rights,
including, without limitation” intellectual property rights, in and to any and all
Developments, and you agree to assign to Idenix any and all patents and patent applications
arising from such Developments, and to execute and deliver such assignments, patents and
patent applications and other documents (including, without limitation, power of attorney) as
Idenix may direct. Additionally, you agree to cooperate fully with Idenix both during and
after the term of your employment, to enable Idenix to secure and maintain rights in said
Developments assigned to Idenix in any and all countries. In the event that any of such
Developments are by operation of applicable law excluded from this assignment, you agree that
Idenix shall have a non-exclusive, fully paid license to use for all purposes any such
Developments not assigned to Idenix.
	 
	13.	 	No Conflict: By your acceptance of this offer of employment, you hereby represent
that you are not bound by the terms of any agreement with any previous employer or other party
to refrain from competing, directly or indirectly, with the business of such previous employer
or any other party. You further represent that your acceptance of this offer of employment and
employment by Idenix does not and will not breach any agreement to keep in confidence
proprietary information, knowledge or data acquired by you in confidence or in trust prior to
your employment with Idenix.
	 
	14.	 	Nonsolicitation of employees: By your acceptance of this offer of employment, you
shall not, without the express prior written approval of the Company, either directly or
indirectly, knowingly solicit any employee of the Company or it’s affiliates (or any employee
who was employed by the Company or any of it’s affiliates) at any time within your employment
with the Company and a period of one year following the termination of your employment.
	 
	15.	 	Noncompetition: In consideration of your employment by the Company according to
the terms of this offer, you shall not, without the express written approval of the Company,
engage in a

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	 	 	“Competitive Business”, directly or indirectly, as an individual, partner, shareholder,
director, officer, principal, agent, employee, trustee, consultant, or in any relationship
or capacity, in any geographic location in which the Company or any of it’s Affiliates is
engaged in business during your employment and a period of one (1) year after termination
in the event Idenix terminates your employment for reasons other than Cause, or you
terminate your employment for Good Reason. For purposes of clarification, the
noncompetition provision shall not apply at any time during which the company is not paying
severance under section 9. For purposes of this offer, the term “Competitive Business”
shall mean a commercial, for profit entity that discovers, develops and commercializes
therapeutics for the treatment of HBV, HCV and HIV.
	 
	16.	 	Confidential Information of Prior Employers: You shall not use or disclose to
Idenix any information in violation of any agreements with or rights of any prior employer, nor shall
you use or provide to Idenix or bring to the premises of Idenix, any copies or tangible
embodiments of non-public information belonging to or obtained from any such prior
agreement.

In the position of Executive Vice President and Chief Medical Officer, you will have access to
valuable, confidential and proprietary information. Accordingly, as a condition to commencing
employment with Idenix, you will be required to enter into a confidentiality and non-disclosure
agreement in standard form regarding the nondisclosure and nonuse of such valuable, confidential
and proprietary information.

If you agree with the above terms, please sign both copies of this letter indicating your
acceptance and return one copy to me at your earliest convenience but in any event no later than
January 8th, 2007. The second copy of this letter is for your records. This offer of employment
will expire on January 9th, 2007.

Very truly yours,

	 	 	 
	/s/
Jean-Pierre Sommadossi
 

Jean-Pierre Sommadossi

	 	 
	Chairman and Chief Executive Officer
	 	 

ACCEPTED as of this 5 day of January, 2007

	 	 	 
	/s/ Douglas L. Mayers
	 	 
	 

Douglas L. Mayers, M.D.

	 	 

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Kendall Square, Building 1400 l Cambridge MA 02139 l Main Tel: 617.995.9800 l Main Fax: 617.995.9030 l
www.idenix.com

 

Appendix A

“Change in Control” shall mean:

     (i) any “person,” as such term is used in Sections 3(a)(9) and 13(d) of the
Securities Exchange Act of 1934, becomes a “beneficial owner,”
as such term is used in Rule 13d-3 promulgated under that act,
of fifty percent (50%) or more of the Voting Stock of the
Company, or Novartis Pharma AG disposes of its entire interest
in the Company’s Voting Stock;

     (ii) the Company adopts any plan of liquidation providing
for the distribution of all or substantially all of its assets;

     (iii) all or substantially all of the assets or business
of the Company is disposed of pursuant to a merger,
consolidation or other transaction (unless the shareholders of
the Company immediately prior to such merger, consolidation or
other transaction beneficially own, directly or indirectly, at
least fifty percent (50%) of the Voting Stock or other
ownership interests of the entity or entities, if any, that
succeed to the business of the Company); or

     (iv) the Company combines with another company and is the
surviving corporation but, immediately after the combination,
the shareholders of the Company immediately prior to the
combination hold, directly or indirectly, fifty percent (50%)
or less of the Voting Stock of the combined company (there
being excluded from the number of shares held by such
shareholders, but not from the Voting Stock of the combined
company, any shares received by affiliates of such other
company in exchange for stock of such other company).

     For purposes of this definition of “Change in Control” the “Company”
shall include any entity that succeeds to all or substantially all of the
business of the Company and “Voting Stock” shall mean securities of any
class or classes having general voting power under ordinary circumstances,
in the absence of contingencies, to elect the directors of a corporation.

“Good Reason” to terminate your employment with Idenix shall be
deemed to exist if, there is: (i) any adverse change in your title or a
material diminution in your authority or responsibilities; (ii) a
reduction in your Base Salary, the Target Bonus or target equity amount;
or (iii) the primary place of your employment is relocated by Idenix to a
location more than 40 miles from Cambridge, Massachusetts.

“Termination for Cause” shall be the result of: (i) willful fraud
or willful material dishonesty in connection with the Employee’s
employment by the Company; (ii) intentional failure by the Employee to
substantially perform the Employee’s duties hereunder or gross neglect in
the performance of such duties; (iii) gross misconduct by the Employee
that is materially detrimental to the Company’s reputation! goodwill or
business operations; (iv) a breach of any of the Employee’s covenants; or
(v) the conviction of, or plea of nolo contendere to, a
charge of commission of a felony; provided that prior to any Termination
for Cause Employee is given written notice with specificity of any such
reasons and a reasonable opportunity to cure if such a cure is reasonably
possible.

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Executive’s
Release of Claims

AGREEMENT AND RELEASE

     THIS AGREEMENT AND RELEASE is executed
by                               (the “Executive”) releasing
certain claims against Idenix Pharmaceuticals, Inc., a corporation domesticated under the laws of
the State of Delaware (together with its successors and assigns, the “Company”), and
certain affiliated parties.

     WHEREAS, the Executive and the Company have entered into an letter agreement as of
           , 2007
(the “Letter Agreement”);

     WHEREAS, the Executive’s employment with the Company has terminated and as such the Executive
is due certain payments and entitlements pursuant to the Letter Agreement subject to the
Executive’s executing this Agreement and Release.

     NOW, THEREFORE, in consideration of the payments set forth in paragraph 9 of the
Letter Agreement and other good and valuable consideration, the Executive agrees as
follows:

          1. The Executive, on behalf of himself and his dependents, heirs, administrators, agents,
executors, successors and assigns, hereby releases and forever discharges the Company and all of
its current and former subsidiaries, joint venturers, affiliates and executive benefit plans, and
all of their respective directors, officers, trustees, employees, successors and assigns
(collectively, the “Released Parties”), from any and all charges, controversies, claims,
wages, rights, agreements, actions, costs or expenses, causes of action, obligations, damages,
losses, promises and liabilities of whatever kind or nature, in law or equity or otherwise, whether
known or unknown, suspected or unsuspected, from the beginning of time to the date the Executive
executes this Agreement and Release, including,but not limited to, any and all claims arising out
of, or relating to, the Executive’s employment with the Company or any affiliate, or the
termination thereof, including, but not limited to, claims under the Age Discrimination in
Employment Act (ADEA), as amended by the Older Workers’ Benefit Protection Act (OWBPA) or any state
counterpart, Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Equal Pay
Act, the Sarbanes-Oxley Act, the Americans With Disabilities Act of 1990 (ADA), the Fair Credit
Reporting Act, the Employee Retirement Income Security Act of 1974 (ERISA), the Family and Medical
Leave Act (FMLA), the Massachusetts Fair Employment Practices Act., the Massachusetts Civil Rights
Act, the Massachusetts Equal Rights Act, the Massachusetts Labor and Industries Act, the
Massachusetts Privacy Act, and the Massachusetts Maternity Leave Act, all as amended, all claims of
discrimination, retaliation or harassment under any applicable state law or any local, state or
federal law or regulation governing discrimination in employment; all claims under state contract
or tort law such as wrongful termination, assault, invasion of privacy, breach of the implied
covenant of good faith and fair dealing, defamation or negligent or intentional infliction of
emotional distress and all claims for attorneys’ fees.

          Anything to the contrary notwithstanding in this Agreement and Release, nothing herein shall
release any Released Party from any claims or damages based on (i) any right or claim that arises
after the

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date of this Agreement and Release, (ii) any right the Executive may have to enforce paragraphs 2 3
and 9 of the Letter Agreement or this Agreement and Release, (iii) any right the Executive may have
to benefits or entitlements under any applicable plan, policy, program, award or agreement of the
Company or any Affiliate, or (iv) the Executive’s eligibility for indemnification in accordance
with applicable laws or the Company’s restated certificate of incorporation, as amended, or
by-laws, or under any applicable insurance policy with respect to any liability the Executive
incurs or has incurred as an officer of the Company.

          2.
The Executive expressly acknowledges and agrees that this Agreement and Release fully and finally releases and fully resolves any and all disputes between him and any Released Party
with respect to the claims released herein, including those that are unknown, unanticipated or
unsuspected or which may hereafter arise as a result of the discovery of new or additional facts.

          3.
The Executive understands and agrees that by entering into this Agreement, he is waiving any and all rights or claims he might have under the Age Discrimination in Employment Act as
amendment by the Older Workers Benefits Protection Act, and that he has received consideration
beyond that to which he was previously entitled. The Executive acknowledges that he has been
provided a period of at least twenty-one (21) calendar days in which to consider and execute this
Agreement and Release I he Executive further acknowledges and understands that he has seven
calendar days from the date on which he executes this Agreement and Release to revoke his
acceptance of this Agreement and Release by delivering to the Company written notification of his
intention to revoke this Agreement and Release If the Executive so revokes his agreement to this
Agreement and Release he shall not be entitled to the payments, benefits and other entitlements
provided pursuant to paragraph 9 of the Letter Agreement that are conditioned on him executing this
Agreement and Release, This Agreement and Release becomes effective when signed by the Executive
unless revoked in writing in accordance with this seven-day provision. To the extent that the
Executive has not otherwise done so, the Executive is advised to consult with an attorney prior to
executing this Agreement and Release.

     IN WITNESS WHEREOF, the Executive has executed this Agreement and Release as of the date
written below.

	 	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Executive	 	 	 	 

	 	 	 	 	 	 	 
	 

	 	Date:	 	 	 	 
	 

	 	 	 	 

	 	 

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                              AMENDED AND RESTATED
                             POLYMEDICA CORPORATION
                             EXECUTIVE SAVINGS PLAN

                                   ----------

     THIS AMENDED AND RESTATED EXECUTIVE SAVINGS PLAN amends the Executive
Savings Plan dated January 1, 2005, and is made effective as May 3, 2007 by
PolyMedica Corporation, a corporation duly organized and existing under the laws
of the State of Massachusetts.

                                    RECITALS:

     WHEREAS, the Company desires to permit executives of the Company to defer a
portion of their compensation; and

     WHEREAS, the Company also desires to make certain matching contributions
under the Plan based on amounts executives elect to defer, and to make
additional contributions based upon compensation that is in excess of the
compensation with respect to which Social Security contributions are made.

     NOW, THEREFORE, in consideration of the premises and mutual covenants set
forth herein, the Company hereby adopts this Plan pursuant to the following
terms and provisions.

                                    ARTICLE 1

                                   DEFINITIONS

     1.1 "Accounting Date" means the last day of the Plan Year, each day that
the New York Stock Exchange is open for business, and such other date or dates
as the Committee may designate from time to time as an Accounting Date.

     1.2 "Affiliate" means any majority owned subsidiary of the Company.

     1.3 "Base Salary" means the regular or base salary or wages received in
respect of services rendered during the applicable period by a Participant from
the Employer.

     1.4 "Beneficiary" means the person or persons designated by a Participant,
upon such forms as shall be provided by the Committee, to receive payment of the
Participant's Account after the Participant's death. If the Participant shall
fail to designate a Beneficiary, or if for any reason such designation shall be
ineffective, or if such Beneficiary shall predecease the Participant or die
simultaneously with the Participant, then the Beneficiary shall be, in the
following order of preference:

<PAGE>

               (i) the Participant's surviving spouse, or

               (ii) the Participant's estate.

     1.5 "Board" means the Board of Directors of the Company.

     1.6 "Bonus" means a cash bonus paid to a Participant by the Employer for
personal services.

     1.7 "Change in Control" means the occurrence of a "Change in Control" of
the Company, as defined in the Company's 2000 Stock Incentive Plan as in effect
on January 1, 2005.

     1.8 "Code" means the Internal Revenue Code of 1986, as amended, and
successor tax laws.

     1.9 "Committee" means the committee appointed to administer the PolyMedica
Corporation 401(k) Plan, as it may be comprised from time to time, consisting of
one or more persons. In the absence of a committee appointed to administer the
PolyMedica Corporation 401(k) Plan, the Committee shall be comprised of one or
more persons appointed by the Compensation Committee of the Board, who shall
serve at the pleasure of the Compensation Committee or as otherwise set forth in
the resolution appointing such person(s), and in the absence of a committee
appointed to administer the PolyMedica Corporation 401(k) Plan and such
appointment(s), the Compensation Committee of the Board shall constitute the
Committee.

     1.10 "Company" means PolyMedica Corporation, a Massachusetts corporation,
its successors and assigns.

     1.11 "Compensation" means the total of all amounts paid to a Participant by
the Employer as Base Salary and Bonuses for personal services for the Plan Year,
before any reductions for elective contributions under Sections 401(k) or 125 of
the Code, or any Tax-Deferred Contributions under this Plan, for the period
during the Plan Year in which an Eligible Person is a Participant.

     1.12 "Disabled" or "Disability" means the inability of the Participant to
engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or can be expected to last for a continuous period of not less than 12
months.

     1.13 "Deferral Agreement" means the agreement in the form or forms
prescribed by the Committee, which may be electronic, entered into by the
Eligible Person in accordance with Section 3.1 hereof pursuant to which the
Eligible Person shall elect (i) the amount of his or her Tax-Deferred
Contributions for the Plan Year, (ii) the allocation of his or her Tax-Deferred
Contributions among his or her Retirement Account and In-Service Accounts, if
any have been established pursuant to a Deferral Agreement, and (iii) the manner
in which distribution of the Participant's Account is to be paid in accordance
with Article 6 hereof.

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     1.14 "Eligible Persons" means each full-time, common law employee of the
Employer (not including persons engaged as independent contractors by the
Employer), designated by the Compensation Committee of the Board to be eligible
to participate in the Plan. The Compensation Committee of the Board shall not
designate an employee as an Eligible Person unless he or she is deemed to be
among a select group of management or highly compensated employees of the
Employer within the meaning of Section 201(2) of ERISA.

     1.15 "Employer" means the Company and any Affiliate that adopts the Plan
with the consent of the Company.

     1.16 "Employer Contributions" means the contributions made by the Employer
that are credited to the Participant's Account in accordance with Section 3.3
hereof.

     1.17 "Employer Contributions Subaccount" means the account maintained under
the Plan for a Participant that is credited with the Participant's Employer
Contributions.

     1.18 "Entry Date" means January 1, 2005, and the first day of each calendar
month thereafter.

     1.19 "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor laws.

     1.20 "In-Service Account" means an account established by a Participant
pursuant to one or more Deferral Agreements which shall have a distribution date
selected by the Participant in accordance with Section 6.1(a) hereof, and to
which a Participant may allocate a portion of his current Tax-Deferred
Contributions.

     1.21 "Investment Funds" means those investment options that shall from time
to time be made available as investment options under the Trust.

     1.22 "Key Employee" means any Participant who is a "key employee" within
the meaning of Section 416(i) of the Code, of the Employer, if the stock of any
Employer is publicly traded on an established securities market or otherwise.

     1.23 "Leave of Absence" means any absence authorized by the Employer that
employs the Participant under its standard personnel practices.

     1.24 "Matching Contributions" means the matching contributions made by the
Employer that are credited to the Participant's Account in accordance with
Section 3.2 hereof.

     1.25 "Matching Contributions Subaccount" means the account maintained under
the Plan for a Participant that is credited with the Participant's Matching
Contributions.

     1.26 "Participant" means an Eligible Person who becomes a Participant
pursuant to Section 2.1 of this Plan.

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<PAGE>

     1.27 "Participant's Account" means, collectively, a Participant's
Retirement Account and In-Service Accounts (if any) maintained under the Plan in
accordance with the provisions of the Plan for each Participant.

     1.28 "Performance Based Compensation Bonus" means compensation based on
services over a period of at least 12 months and that satisfies the requirements
for performance based compensation as that term is used in Section 409A(a)(4) of
the Code.

     1.29 "Plan" means the Amended and Restated PolyMedica Corporation Executive
Savings Plan as herein set forth and as it may be amended from time to time.

     1.30 "Plan Year" means each twelve (12) month period beginning on or after
January 1, 2005, that begins a January 1 and ends on a December 31.

     1.31 "Retirement Account" means the account maintained under the Plan in
accordance with the provisions of the Plan for each Participant, that includes
the Participant's Matching Contributions Subaccount and Employer Contributions
Subaccount, and the portion of the Participant's Tax-Deferred Contributions
Subaccount that has not been credited to an In-Service Account.

     1.32 "Separation from Service" means the earliest date on which a
Participant has incurred a separation from service, within the meaning of
Section 409A(a)(2) of the Code, with the Employer, or if later, and elected by
the Participant when the Participant executes his or her initial Deferral
Agreement, the date on which the Participant ceases to provide consulting
services to the Employer that begin immediately following termination of the
Participant's employment with the Employer.

     1.33 "Social Security Wage Base" means the maximum amount of wages that are
considered for Social Security purposes for the Plan Year in question.

     1.34 "Tax-Deferred Contributions" means the Compensation reduction
contributions credited to the Participant's Account under Section 3.1 of the
Plan.

     1.35 "Tax-Deferred Contributions Subaccount" means the account maintained
under the Plan for a Participant that is credited with the Participant's
Tax-Deferred Contributions.

     1.36 "Trust" means the PolyMedica Corporation Executive Savings Plan Trust
created pursuant to the Trust Agreement dated as of January 1, 2000 between the
Company and Reliance Trust Company, as trustee, as amended from time to time.

     1.37 "Trustee" means the person or entity that shall from time to time be
serving as the Trustee of the Trust.

                                    ARTICLE 2

                                   ELIGIBILITY

     2.1 Determining Eligibility.

                                        4

<PAGE>

          (a) Only Eligible Persons may become Participants in the Plan.

          (b) An Eligible Person shall become a Participant on the Entry Date
coincident with or immediately following the date on which he or she becomes an
Eligible Person, or such later Entry Date as the Committee may determine.

          (c) Participants in the Plan shall be classified into the following
two groups:

               (i) Group 1 shall be comprised of all Participants who were, on
or prior to March 31, 2007, required to file reports with respect to the Company
pursuant to Section 16 of the Securities Exchange Act of 1934, as amended, and
all other Participants designated by the Compensation Committee of the Board as
being members of Group 1 for all or a portion of the Plan Year.

               (ii) Group 2 shall be comprised of all Participants who are not
in Group 1 for the Plan Year.

                                    ARTICLE 3

                                  CONTRIBUTIONS

     3.1 Tax-Deferred Contributions.

          (a) Tax-Deferred Contribution Elections. Each Participant, so long as
he or she remains a Participant, may elect, pursuant to a Deferral Agreement and
in accordance with Committee rules, to defer receipt of a portion of his or her
Compensation pursuant to this Plan, consisting of (i) a minimum of 0% and a
maximum of 25% (in whole percentages) of his Base Salary earned during the Plan
Year, and (ii) a minimum of 0% and a maximum of 100% (in whole percentages) of
any Bonuses earned during the Plan Year.

          (b) Timing of Tax-Deferred Contribution Elections. A Participant's
Deferral Agreement containing any election to defer Base Salary is effective on
a Plan Year basis, must be filed before the beginning of the Plan Year to which
it relates, and may not be amended or revoked after the beginning of the Plan
Year with respect to that Plan Year. A Participant's Deferral Agreement
containing an election to defer any Bonus that does not constitute Performance
Based Compensation must be filed prior to the beginning of the Plan Year in
which the Company's fiscal year with respect to which the Bonus will be paid
begins. Such election shall apply to the Bonus payable for such fiscal year of
the Company, and may not be amended or revoked with respect to that Bonus after
the beginning of the Plan Year in which such fiscal year begins. A Participant's
election to defer any Performance Based Compensation for a Plan Year must be
filed on or before September 30 of the Plan Year preceding the Plan Year in
which the Performance Based Compensation is payable, and may not be amended or
revoked with respect to such Plan Year after that September 30. A Participant
may change his or her election with respect to any subsequent deferrals of Base
Salary or Bonuses by timely submitting a new Deferral Agreement. Notwithstanding
any of the foregoing, the Committee may from time to time set such other
deadlines for the filing of Participant elections as it may determine in its
discretion, provided that such other deadlines would not result in a violation
of any of the requirements of Section 409A of the Code.

                                        5

<PAGE>

          (c) Special Rule for First Year of Participation. An Eligible Person
who becomes a Participant during a Plan Year may file a Participant Deferral
Agreement within 30 days after becoming a Participant. The Participant election
form shall apply to Compensation with respect to services to be performed
subsequent to the election, beginning with the first administratively
practicable payroll period after it is filed, and may not be amended or revoked
during the Plan Year for which it is made.

          (d) Allocation to Retirement or In-Service Accounts. Each Participant,
so long as he or she remains a Participant, may elect on his or her Deferral
Agreement to allocate his or her Tax-Deferred Contributions for the Plan Year
among his Retirement Account and one or more In-Service Accounts. The Employer
shall withhold, by payroll deduction, the amounts deferred pursuant to this
Section 3.1 from the current Compensation of a Participant and credit such
withheld amount to the Participant's Retirement Account or to an In-Service
Account, as elected by the Participant.

          (e) Timing of Tax Deferred Contributions. Tax-Deferred Contributions
made under this Section 3.1 shall be credited to a Participant's Tax-Deferred
Contributions Account as and when such amounts are withheld from each
Participant's Compensation, or as soon as practicable thereafter.

     3.2 Matching Contributions.

          (a) Amount of Matching Contributions. For each Plan Year, the
Committee shall credit to the Matching Contributions Subaccount of each eligible
Participant an amount equal to the lesser of (i) 50% of the Participant's
Tax-Deferred Contributions for the Plan Year, and (ii) 3% of the amount by which
the Participant's Compensation for the Plan Year exceeds the compensation limit
under Section 401(a)(17) of the Code for the Plan Year. A Participant shall not
be eligible for a Matching Contribution for any Plan Year unless the Participant
is a member of Group 1 or Group 2, as defined in Section 2.1(c) hereof, for that
Plan Year.

          (b) Timing of Matching Contributions. Any Matching Contributions made
under this Section 3.2 shall be credited to a Participant's Matching
Contributions Subaccount no later than the January 31 that immediately follows
the last day of the Plan Year for which the contribution is made.

     3.3 Employer Contributions.

          (a) Amount of Employer Contributions. For each Plan Year, the
Committee shall credit an Employer Contribution to the Employer Contribution
Subaccount of each eligible Participant equal to 6.2% of the excess, if any, of
such Participant's Compensation for the Plan Year over the Social Security Wage
Base for that year. A Participant shall not be eligible for an Employer
Contribution for any Plan Year unless the Participant is a member of Group 1 for
that Plan Year.

          (b) Timing of Discretionary Employer Contributions. Any Discretionary
Employer Contributions made under this Section 3.3 shall be credited to a
Participant's Employer Contributions Subaccount by no later than the January 31
that immediately follows the last day of the Plan Year for which the
contribution is made.

                                        6

<PAGE>

                                    ARTICLE 4

                                     VESTING

     4.1 All Accounts. A Participant's interest in all of his or her Accounts
shall be fully vested and nonforfeitable at all times.

                                    ARTICLE 5

                       VALUATION OF PARTICIPANT'S ACCOUNTS

     5.1 Account Value. Each Participant's Account shall be treated as if it
were actually invested by the Participant in the Investment Funds selected by
the Participant in such manner and at such times as shall be determined by the
Committee and in accordance with the Plan, and shall be credited with gains and
losses allocable thereto at such times and in such manner as shall be determined
by the Committee. Participants may change their Investment Fund selections at
such times and in such manner as shall be prescribed by the Committee.

     5.2 Contribution to Trust. Amounts credited to a Participant's Account
shall be contributed by the Employer to the Trust at such time or times as the
Employer shall determine.

                                    ARTICLE 6

                                  DISTRIBUTIONS

     6.1 Timing of Distributions.

          (a) Timing of In-Service Account Distributions.

               (i) A Participant shall specify, in the manner prescribed by the
Committee, a date on which distributions from each In-Service Account of the
Participants are to commence (the "In-Service Distribution Date"), which date
must be at least 2 years from the end of a Plan Year in which contributions are
made to the In-Service Account. A Participant may not have more than 3
In-Service Accounts in existence at any one time.

               (ii) A Participant may change the In-Service Distribution Date
with respect to an In-Service Account up to 3 times per In-Service Account;
provided, however, that (1) each change must extend the In-Service Distribution
Date by at least 5 years, (2) each change must be made at least 13 months prior
to the In-Service Distribution Date being changed, and (3) and no change may
accelerate an In-Service Distribution Date.

               (iii) Distributions shall commence from an In-Service Account as
soon as administratively practicable following the earlier of (1) the In-Service
Distribution Date for that In-Service Account, or (2) the first day of the month
immediately following the date of the Participant's Separation from Service or
termination of employment with the Employer by reason of the Participant's death
or Disability.

                                        7

<PAGE>

          (b) Timing of Retirement Account Distributions. A Participant's
Retirement Account shall be distributed commencing on or as soon as
administratively practicable after the first day of the month immediately
following the date of the Participant's Separation from Service or termination
of employment with the Employer by reason of the Participant's death or
Disability.

          (c) Distributions to Key Employees. Notwithstanding the foregoing, in
no event shall any distributions be made under the Plan on account of the
Separation from Service of any Participant that is a Key Employee, before the
date that is 6 months after the date of the Participant's Separation from
Service or, if earlier, the date of the Participant's death or Disability, or as
otherwise permitted without violating the requirements of 409(A)(a)(2) of the
Code.

     6.2 Form of Distributions.

          (a) Form of In-Service Account Distributions. Distribution of each of
a Participant's In-Service Accounts shall be made in one of the following forms
specified by the Participant in the manner prescribed by the Committee: (x) a
lump sum distribution, or (y) in at least 4 but not more than 60 quarterly
installments. Each installment shall be equal to the value of the In-Service
Account multiplied by a fraction, the numerator of which is 1 and the
denominator of which is the number of installments remaining to be paid.

          (b) Form of Retirement Account Distributions. Distribution of the
Participant's Retirement Account shall be made in one of the following forms
specified by the Participant in the manner prescribed by the Committee: (x) a
lump sum distribution, or (y) in at least 4 but not more than 60 quarterly
installments. Each installment shall be equal to the value of the Participant's
Retirement Account multiplied by a fraction, the numerator of which is 1 and the
denominator of which is the number of installments remaining to be paid.

          (c) Changes to Forms of Distributions; Failure to Elect Form. A
Participant may elect on a form provided by the Committee to change the form in
which his In Service or Retirement Account is to be distributed under Section
6.2(a) or (b) and the most recent election made by the Participant with respect
to each such Account shall apply with respect to each such Account. In no event,
however, shall (x) any change in the Participant's election take effect until at
least 12 months after the date on which the election is made, and (y) any
election related to an In-Service Account be made less than 12 months prior to
the date of the first scheduled payment with respect to that In-Service Account.
If a Participant fails to elect a form of distribution, then distribution shall
be made in the form of a lump sum.

          (d) Small Account Balances. Notwithstanding anything to the contrary
contained in this Section 6.2, in the event that the value of a Participant's
Retirement Account as of the distribution date is less than the Minimum
Distribution Amount, or the value of an In-Service Account as of the In-Service
Distribution Date applicable to that In-Service Account is less than the Minimum
Distribution Amount, distribution shall be made in the form of a lump sum. For
purposes of this provision, the Minimum Distribution Amount shall be $10,000, or
such lesser amount as shall not violate the requirements of Section 409A of the
Code.

                                        8

<PAGE>

     6.3 Payments to Beneficiaries. If a Participant dies before distribution of
the entire vested portion of the Participant's Account has been made to him or
her, any remaining vested amounts (including any remaining installments that
otherwise would have been payable to the Participant under Section 6.2(b), and
the value of any unpaid In-Service Accounts), shall be distributed to the
Participant's Beneficiary or Beneficiaries in a lump sum payment as soon as
practicable after the Participant's death.

     6.4 Change in Control. If and to the extent that it would not violate the
requirements of Section 409A of the Code, in the event of a Change in Control,
the full value of the Participant's Account (including any remaining
installments that otherwise would have been payable to the Participant under
Section 6.2(b), and the value of any unpaid In-Service Accounts), shall be
distributed as a lump sum to the Participant or to the Beneficiary or
Beneficiaries of a deceased Participant, as soon as practicable following the
Change in Control.

     6.5 Method of Distribution. Distribution of the Participant's Account shall
be made in cash, based upon the valuation of such Account on the Accounting Date
coincident with or immediately preceding the date of the distribution.

     6.6 Hardship Distributions. Upon the written request of a Participant and
in the event the Committee determines that an "unforeseeable emergency" has
occurred with respect to a Participant, the Participant may withdraw, in each
case, the lesser of (i) the amount necessary to meet the emergency or (ii) the
value of the Participant's Account, reduced by applicable withholding taxes. For
this purpose, an "unforeseeable emergency" shall mean an unanticipated
emergency, such as a sudden and unexpected illness or accident of the
Participant or a dependent of the Participant or loss of the Participant's
property due to casualty, that is caused by an event beyond the control of the
Participant and that would result in a severe financial hardship if the
withdrawal were not permitted. The need to pay a Participant's child's tuition
to college and the desire to purchase a home shall not be considered
unforeseeable emergencies. Hardship distributions shall first be made from the
Participant's Retirement Account, until depleted, and then from the
Participant's In-Service Accounts, if any, beginning with the In-Service Account
with the most distant distribution date.

     6.7 No Acceleration of Benefits. In no event shall the acceleration of the
time or schedule of any payment under the Plan be permitted, except to the
extent permitted under Section 409A of the Code and the Treasury Regulations
thereunder.

                                    ARTICLE 7

                                 ADMINISTRATION

     7.1 Powers and Duties. The Committee generally shall be responsible for the
management, operation, interpretation and administration of the Plan. The
Committee shall:

          (a) Establish procedures for allocation of responsibilities of the
Plan which are not allocated herein;

                                        9

<PAGE>

          (b) Subject to Section 1.14, determine the names of those employees
who are eligible to participate, and such other matters as may be necessary to
enable payment under the Plan;

          (c) Construe all terms, provisions, conditions and limitations of the
Plan;

          (d) Correct any defect, supply any omission or reconcile any
inconsistency that may appear in the Plan;

          (e) Determine the amount, manner and time of payment of any benefits
hereunder and prescribe procedures to be followed by Participants to obtain
benefits; and

          (f) Perform such other functions and take such other actions as may be
required by the Plan or as may be necessary or advisable to accomplish the
purposes of the Plan.

The Company shall furnish the Committee with all data and information available
which the Committee may reasonably require in order to perform its functions
hereunder. The Committee may rely without question upon any such data or
information furnished by the Company. Any interpretation or other decision made
by the Committee shall be final, binding and conclusive upon all persons in the
absence of clear and convincing evidence that the Committee acted arbitrarily
and capriciously.

     7.2 Agents. The Committee may appoint a Secretary who may, but need not, be
a member of the Committee, and may employ such agents for clerical and other
services, and such counsel, accountants and other professional advisors as may
be required for the purpose of administering the Plan. The Committee may rely on
all tables, valuations, reports, certificates and opinions furnished by its
agents.

     7.3 Procedures. A majority of the Committee members shall constitute a
quorum for the transaction of business. No action shall be taken except upon a
majority vote of the Committee. An individual shall not vote or decide upon any
matter relating solely to himself or vote in any case in which his individual
right or claim to any benefit under the Plan is particularly involved. In any
case in which a Committee member is so disqualified to act, and the remaining
members cannot agree on an issue, the Company shall appoint a temporary
substitute member to exercise all of the powers of the disqualified member
concerning the matter in which he is disqualified.

     7.4 Claims Procedure. In the event that any Participant or Beneficiary
claims to be entitled to benefits under the Plan or believes his or her benefits
are incorrect, that Participant or Beneficiary (hereafter, a "Claimant") may
file a claim for benefits by submitting a written statement describing the basis
of the claim for benefits under the Plan. The Committee shall review the claim
and respond within a reasonable period of time (generally 90 days). However, if
special circumstances require an extension of time to consider the claim, the
Committee may extend the 90 day period up to a total of 180 days. If the
Committee extends the 90 day period, the Claimant will be notified in writing as
to the length of the extension and the special circumstances which necessitate
the extension, including the date on which the Committee expects to render the
determination. If the Committee makes an adverse determination as to the

                                       10

<PAGE>

Claimant's claim, the Committee shall, within the time period described above,
notify the Claimant in a writing setting forth, in a manner calculated to be
understood by the Claimant:

          (1)  the specific reasons for the adverse determination,

          (2)  the provisions of the Plan on which the determination is based,

          (3)  a description of additional information or material necessary for
               the Claimant to perfect the claim and an explanation of why such
               additional information or material is necessary, and

          (4)  a description of the Plan's review procedures and the time limits
               applicable to such procedures, including a statement of the
               Claimant's right to bring suit under Section 502(a) of ERISA
               following an adverse benefit determination on review.

     Within 60 days of receipt by a Claimant of a notice denying a claim, the
Claimant, or his or her duly authorized representative, may request in writing a
full and fair review of the claim by filing an appeal with the Committee. In
connection with such appeal, the Claimant or his or her duly authorized
representative may review pertinent documents and may submit issues and comments
in writing. The Committee shall consider the Claimant's written presentation, as
well as any evidence, facts or circumstances the Committee deems relevant. The
Committee shall make a decision not later than 60 days after the Plan's receipt
of a request for appeal, unless special circumstances (such as the need to hold
a hearing, as determined by the Committee in its sole discretion) require an
extension of time for processing, in which case a decision will be rendered as
soon as possible but not later than 120 days after receipt of a request for
appeal. The Committee shall notify the Claimant prior to the expiration of the
initial 60 day period if an extension is required. The notification shall
indicate the special circumstances requiring the extension, and the date on
which the Committee expects to render the determination on review. If the
initial 60 day period is extended due to a Claimant's failure to submit
information necessary to make the benefit determination on review, the period
shall be tolled from the date on which the notification of the extension is sent
to the Claimant until the date on which the Claimant responds to the request for
additional information.

     Notification of the Committee's decision on appeal shall be provided to the
Claimant in writing. If an adverse determination is made, the notification shall
set forth, in a manner calculated to be understood by the Claimant:

          (1)  the specific reasons for the adverse determination,

          (2)  reference to the specific Plan provisions on which the adverse
               determination is based,

          (3)  a statement that the Claimant is entitled to receive, upon
               request and free of charge, reasonable access to, and copies of,
               all documents, records, and other information relevant to the
               Claimant's claim for benefits, and

                                       11

<PAGE>

          (4)  a statement that the Claimant may bring an action under Section
               502(a) of ERISA.

     7.5 Indemnification. The Company shall indemnify each Committee member
against any liability or loss sustained by reason of any act or failure to act
made in good faith, including, but not limited to, those in reliance on
certificates, reports, tables, opinions or other communications from any company
or agents chosen by the Committee in good faith. Such indemnification shall
include attorneys' fees and other costs and expenses reasonably incurred in
defense of any action brought by reason of any such act or failure to act.

     7.6 Participants Bound. Any action with respect to the Plan taken by the
Committee or the Company or the Trustee or any action authorized by or taken at
the direction of the Committee, the Company or the Trustees shall be final,
binding and conclusive upon all Participants and beneficiaries entitled to
benefits under the Plan in the absence of clear and convincing evidence that the
Committee, Company or Trustee acted arbitrarily and capriciously.

     7.7 Receipts and Release. Any payment to any Participant or Beneficiary in
accordance with the provisions of the Plan shall, to the extent thereof, be in
full satisfaction of all claims against the Company, the Committee and the
Trustee under the Plan, and the Committee may require such Participant or
Beneficiary, as a condition precedent to such payment, to execute a receipt and
release to such effect. If any Participant or Beneficiary is determined by the
Committee to be incompetent by reason of physical or mental disability
(including minority) to give a valid receipt and release, the Committee may
cause the payment or payments becoming due to such person to be made to another
person for his or her benefit without responsibility on the part of the
Committee, the Company or the Trustee to follow the application of such funds.

     7.8 Withholding or Deduction for Taxes. Anything in this Plan to the
contrary notwithstanding, all payments or contributions required to be made, and
all benefits required to be provided, shall be subject to the withholding of
such amounts relating to taxes as the Employer may reasonably determine should
be withheld pursuant to any applicable law or regulation. In lieu of withholding
such amounts, in whole or in part, the Employer may, in its sole discretion,
accept other provisions for payment of taxes and withholding as required by law,
provided it is satisfied that all requirements of law affecting its
responsibilities to withhold have been satisfied.

                                    ARTICLE 8

                                  MISCELLANEOUS

     8.1 Unfunded Plan. The obligations of an Employer under this Plan shall be
paid from the general assets of that Employer and not from any particular fund.
Participants shall have the status of general unsecured creditors of an Employer
and the Plan constitutes a mere promise by that Employer to make benefit
payments in the future. It is intended that this Plan shall constitute an
"unfunded" plan for tax purposes and an "unfunded" plan for a select group of
management or highly compensated employees under ERISA. If an Employer purchases
any life insurance policies, or makes any other investments, such policies (and
any amounts invested by that Employer therein) and any other investments of that
Employer shall be subject to the claims

                                       12

<PAGE>

of that Employer's creditors. The assets of the Trust also shall be subject to
the Employer's creditors in the event of the Employer's Insolvency, as defined
in the Trust Agreement establishing the Trust. Nothing contained in this Plan
shall be interpreted to grant to any Participant or Beneficiary, any right,
title or interest in any property of an Employer or the Trust.

     8.2 Impact on Other Executive Benefits. This Plan shall not be construed to
impact or cause the denial of any benefits to which any Participant may be
entitled under any other welfare or benefit plan of the Employer.

     8.3 Governing Law. The Plan shall be construed, administered, and governed
in all respects under and by the laws of the state in which the Company
maintains its primary place of business.

     8.4 No Assignment. The right to receive payment of any benefits under the
Plan shall not be transferred, assigned or pledged, except by Beneficiary
designation, by will, under the laws of decent and distribution, or as may be
otherwise required by law.

     8.5 Severability. If any provision of this Plan is found, held or deemed to
be void, unlawful or unenforceable under any applicable statute or other
controlling law, the remainder of the Plan shall continue in full force and
effect.

     8.6 Headings and Subheadings. Headings and subheadings in this Plan are
inserted for convenience only and are not to be considered in the construction
of the provisions hereof.

     8.7 Gender. The masculine, as used herein, shall be deemed to include the
feminine and the singular to include plural, except where the context requires a
different construction.

     8.8 Amendment and Termination. This Plan may be amended or terminated in
any respect at any time by the Compensation Committee of the Board; provided,
however, that no amendment or termination of the Plan shall be effective to
reduce any benefits that accrue before the adoption of such amendment or
termination. If and to the extent permitted without violating the requirements
of Section 409A of the Code, the Compensation Committee of the Board may require
that the Accounts of all Participants and Beneficiaries (including, without
limitation, any remaining benefits payable to Participants or Beneficiaries
receiving distributions in installments at the time of the termination) be
distributed as soon as practicable after such termination, notwithstanding any
elections by Participants or Beneficiaries with regard to the timing or form in
which their benefits are to be paid. If and to the extent that the Compensation
Committee of the Board does not accelerate the timing of distributions on
account of the termination of the Plan pursuant to the preceding sentence,
payment of any remaining benefits under the Plan shall be made at the same times
and in the same manner as such distributions would have been made based upon the
most recent elections made by Participants and Beneficiaries, and the terms of
the Plan, as in effect at the time the Plan is terminated.

     8.9 No Employment Contract. This Plan does not constitute a contract of
employment or impose on any Participant or the Employer any obligations to
retain the Participant as an employee, to change the status of the Participant's
employment, or to change the Employer's policies regarding termination of
employment.

                                       13

<PAGE>

     IN WITNESS WHEREOF, the Company has caused the Plan to be executed by its
duly authorized officer effective as of the 3rd day of May, 2007.

                                        POLYMEDICA CORPORATION

                                        By: /s/ Patrick T. Ryan
                                            ------------------------------------
                                        Name: Patrick T. Ryan
                                        Title: President and Chief Executive
                                               Officer

                                       14

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