Document:

exv10w34

Exhibit 10ah

BRUSH ENGINEERED MATERIALS INC.

Appreciation Rights Agreement

     WHEREAS, [GRANTEE NAME] (the “Grantee”) is an employee of Brush Engineered Materials Inc. (the
“Corporation”) or a Subsidiary.

     WHEREAS, the execution of an agreement in the form hereof has been authorized by a resolution
of the Compensation Committee (the “Committee”) of the Board of Directors (the “Board”) of the
Corporation that was duly adopted on February 2, 2009.

     NOW, THEREFORE, the Corporation hereby confirms to the Grantee the grant, effective on
February 2, 2010 (the “Date of Grant”), pursuant to the 2006 Stock Incentive Plan (the “Plan”), of
                     Free-standing Appreciation Rights (“SARs”) subject to the terms and conditions of the
Plan and the terms and conditions described below.

     1. Definitions.

          As used in this Agreement:

          (A) “Base Price” means $           which was the Market Value per Share on the Date of Grant.

          (B) “Detrimental Activity” shall have the meaning set forth in Section 7 of this Agreement.

          (C) “Spread” means the excess of the Market value per Share on the date when an SAR is
exercised over the Base Price.

          (D) Capitalized terms used herein without definition shall have the meanings assigned to them
in the Plan.

     2. Grant of SARs.

          The Corporation hereby grants to the Grantee the number of SARs set forth above. The SARs are
a right to receive Common Shares in an amount equal to 100% of the Spread at the time of exercise.

     3. Vesting of SARs.

          (A) The SARs granted hereby shall become exercisable after the Grantee shall have remained in
the continuous employ of the Corporation or any Subsidiary for three years from the Date of Grant,
unless the Grantee ceases to be an employee of the Corporation or any Subsidiary as described in
Section 5(C) of this Agreement.

 

 

          (B) Notwithstanding the preceding paragraph, the SARs granted hereby shall become immediately
exercisable in full if (i) the Grantee should die while in the employ of the Corporation or any
subsidiary; (ii) the Grantee should become permanently disabled while in the employ of the
Corporation; or (iii) if a Change in Control occurs.

          (C) For purposes of this Agreement, “Change in Control” means:

     (i) The acquisition by any individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of
1934, as amended (the “Exchange Act”)) (a “Person”) of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of
voting securities of the Corporation where such acquisition causes such
Person to own (X) 20% or more of the combined voting power of the then
outstanding voting securities of the Corporation entitled to vote generally
in the election of directors (the “Outstanding Corporation Voting
Securities”) without the approval of the Incumbent Board as defined in (ii)
below or (Y) 35% or more of the Outstanding Voting Securities of the
Corporation with the approval of the Incumbent Board; provided, however,
that for purposes of this subsection (i), the following acquisitions shall
not be deemed to result in a Change of Control: (A) any acquisition directly
from the Corporation that is approved by the Incumbent Board (as defined in
subsection (ii), below), (B) any acquisition by the Corporation or a
subsidiary of the Corporation, (C) any acquisition by any employee benefit
plan (or related trust) sponsored or maintained by the Corporation or any
corporation controlled by the Corporation, (D) any acquisition by any Person
pursuant to a transaction described in clauses (A), (B) and (C) of
subsection (iii) below, or (E) any acquisition by, or other Business
Combination (as defined in (iii) below) with, a person or group of which
employees of the Corporation or any subsidiary of the Corporation control a
greater than 25% interest (a “MBO”) but only if the Executive is one of
those employees of the Corporation or any subsidiary of the Corporation that
are participating in the MBO; provided, further, that if any Person’s
beneficial ownership of the Outstanding Corporation Voting Securities
reaches or exceeds 20% or 35%, as the case may be, as a result of a
transaction described in clause (A) or (B) above, and such Person
subsequently acquires beneficial ownership of additional voting securities
of the Corporation, such subsequent acquisition shall be treated as an
acquisition that causes such Person to own 20% or 35% or more, as the case
may be, of the Outstanding Corporation Voting Securities; and provided,
further, that if at least a majority of the members of the Incumbent Board
determines in good faith that a Person has acquired beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 20%
or more of the Outstanding Corporation Voting Securities inadvertently, and
such Person divests as promptly as practicable a sufficient number of shares
so that such Person beneficially owns (within the meanings of Rule 13d-3
promulgated under the Exchange Act) less than 20% of the

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Outstanding Corporation Voting Securities, then no Change of Control
shall have occurred as a result of such Person’s acquisition; or

     (ii) individuals who, as of the date hereof, constitute the Board (the
“Incumbent Board”) (as modified by this clause (ii)) cease for any reason to
constitute at least a majority of the Board; provided, however, that any
individual becoming a director subsequent to the date hereof whose election,
or nomination for election by the Corporation’s shareholders, was approved
by a vote of at least a majority of the directors then comprising the
Incumbent Board (either by a specific vote or by approval of the proxy
statement of the Corporation in which such person is named as a nominee for
director, without objection to such nomination) shall be considered as
though such individual were a member of the Incumbent Board, but excluding,
for this purpose, any such individual whose initial assumption of office
occurs as a result of an actual or threatened election contest with respect
to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than
the Board; or

     (iii) the consummation of a reorganization, merger or consolidation or
sale or other disposition of all or substantially all of the assets of the
Corporation or the acquisition of assets of another corporation, or other
transaction (“Business Combination”) excluding, however, such a Business
Combination pursuant to which (A) the individuals and entities who were the
ultimate beneficial owners of voting securities of the Corporation
immediately prior to such Business Combination beneficially own, directly or
indirectly, more than 65% of, respectively, the then outstanding shares of
common stock and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors, as the
case may be, of the entity resulting from such Business Combination
(including, without limitation, an entity that as a result of such
transaction owns the Corporation or all or substantially all of the
Corporation’s assets either directly or through one or more subsidiaries),
(B) no Person (excluding any employee benefit plan (or related trust) of the
Corporation, the Corporation or such entity resulting from such Business
Combination) beneficially owns, directly or indirectly (X) 20% or more, if
such Business Combination is approved by the Incumbent Board or (Y) 35% or
more, if such Business Combination is not approved by the Incumbent Board,
of the combined voting power of the then outstanding securities entitled to
vote generally in the election of directors of the entity resulting from
such Business Combination and (C) at least a majority of the members of the
board of directors of the corporation resulting from such Business
Combination were members of the Incumbent Board at the time of the execution
of the initial agreement, or of the action of the Board, providing for such
Business Combination; or

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     (iv) approval by the shareholders of the Corporation of a complete
liquidation or dissolution of the Corporation except pursuant to a Business
Combination described in clauses (A), (B) and (C) of subsection (iii),
above.

     4. Exercise of SARs.

          (A) To the extent exercisable as provided in Section 3 of this agreement, SARs may be
exercised in whole or in part by giving notice to the Corporation specifying the number of SARs to
be exercised.

          (B) The Corporation will issue to the Grantee the number of Common Shares that equals the
Market Price per Share divided into the Spread on the date of exercise rounded down to the nearest
whole share.

     5. Termination of SARs.

     The SARs granted hereby shall terminate upon the earliest to occur of the following:

          (A) 190 days after the Grantee ceases to be an employee of the Corporation or a Subsidiary,
unless he ceases to be such employee by reason of death or in a manner described in clause
(B), (C) or (F) below;

          (B) One year after the Grantee ceases to be an employee of the Corporation or a Subsidiary if
the Grantee is disabled within the meaning of Section 105(d)(4) of the Internal Revenue Code;

          (C) Three years after the Grantee ceases to be an employee of the Corporation or a Subsidiary
if the Grantee is at the time of such termination (i) at least age 65 or (ii) at least age 55 and
has completed at least 10 years of continuous employment with the Corporation or a Subsidiary;

          (D) One year after the death of the Grantee, if the Grantee dies while an employee of the
Corporation or a subsidiary or within the period specified in (A) or (B) above which is applicable
to the Grantee;

          (E) Ten years from the Date of Grant; and

          (F) Immediately if the Grantee engages in any Detrimental Activity (as hereinafter defined).

          6. Effect of Detrimental Activity.

          If the Grantee, either during employment by the Corporation or a subsidiary or within one year
after termination of such employment, shall engage in any Detrimental Activity, and the Board shall
so find:

          (A) All SARs held by the Grantee, whether or not exercisable, shall be forfeited to the
Corporation.

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          (B) Return to the Corporation all Common Shares that the Grantee has not disposed of that were
purchased pursuant to this Agreement, and

          (C) With respect to any Common Shares that the Grantee received upon exercise of the SARs that
have been disposed of pay to the Corporation in cash the amount equal to the Spread applicable to
such Common Shares on the date of exercise of such SARs.

To the extent that such amounts are not paid to the Corporation, the Corporation may, to the extent
permitted by law, set off the amounts so payable to it against any amounts that may be owing from
time to time by the Corporation or a Subsidiary to the Grantee, whether as wages, deferred
compensation or vacation pay or in the form of any other benefit or for any other reason.

          7. Definition of Detrimental Activity.

          For purposes of this Agreement, the term “Detrimental Activity” shall include:

          (A) Engaging in any activity in violation of the Section entitled “Competitive Activity;
Confidentiality; Nonsolicitation” in the Severance Agreement between the Corporation and the
Optionee, if such agreement is in effect on the date hereof, or in violation of any corresponding
provision in any other agreement between the Corporation and the Optionee in effect on the date
hereof providing for the payment of severance compensation; or

     (i) If no such severance agreement is in effect or if a severance
agreement does not contain a section corresponding to “Competitive Activity;
Confidentiality; Nonsolicitation” as of the date hereof:

          (a) Competitive Activity During Employment. Competing with the Corporation anywhere
within the United States during the term of the Optionee’s employment, including, without
limitation:

     (1) entering into or engaging in any business which competes
with the business of the Corporation;

     (2) soliciting customers, business, patronage or orders for, or
selling, any products or services in competition with, or for any
business that competes with, the business of the Corporation;

     (3) diverting, enticing or otherwise taking away any customers,
business, patronage or orders of the Corporation or attempting to do
so; or

     (4) promoting or assisting, financially or otherwise, any
person, firm, association, partnership, corporation or other entity
engaged in any business which competes with the business of the
Corporation.

          (b) Following Termination. For a period of one year following the Optionee’s
termination date:

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     (1) entering into or engaging in any business which competes
with the Corporation’s business within the Restricted Territory (as
hereinafter defined);

     (2) soliciting customers, business, patronage or orders for, or
selling, any products or services in competition with, or for any
business, wherever located, that competes with, the Corporation’s
business within the Restricted Territory;

     (3) diverting, enticing or otherwise taking away any customers,
business, patronage or orders of the Corporation within the
Restricted Territory, or attempting to do so; or

     (4) promoting or assisting, financially or otherwise, any
person, firm, association, partnership, corporation or other entity
engaged in any business which competes with the Corporation’s
business within the Restricted Territory.

For the purposes of Sections 7(A)(ii)(a) and (b) above,
inclusive, but without limitation thereof, the Optionee will be in
violation thereof if the Optionee engages in any or all of the
activities set forth therein directly as an individual on the
Optionee’s own account, or indirectly as a partner, joint venturer,
employee, agent, salesperson, consultant, officer and/or director of
any firm, association, partnership, corporation or other entity, or
as a stockholder of any corporation in which the Optionee or the
Optionee’s spouse, child or parent owns, directly or indirectly,
individually or in the aggregate, more than five percent (5%) of the
outstanding stock.

          (c) “The Corporation.” For the purposes of this Section 7(A)(ii), the “Corporation”
shall include any and all direct and indirect subsidiaries, parents, and affiliated, or related
companies of the Corporation for which the Optionee worked or had responsibility at the time of
termination of the Optionee’s employment and at any time during the two year period prior to such
termination.

          (d) “The Corporation’s Business.” For the purposes of this Section 7 inclusive, the
Corporation’s business is defined to be the manufacture, marketing and sale of high performance
engineered materials serving global telecommunications and computer, magnetic and optical data
storage, aerospace and defense, automotive electronics, industrial components and appliance
markets, as further described in any and all manufacturing, marketing and sales manuals and
materials of the Corporation as the same may be altered, amended, supplemented or otherwise
changed from time to time, or of any other products or services substantially similar to or
readily substitutable for any such described products and services.

          (e) “Restricted Territory.” For the purposes of Section 7(A)(ii)(b), the Restricted
Territory shall be defined as and limited to:

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     (1) the geographic area(s) within a one hundred mile radius of
any and all Corporation location(s) in, to, or for which the Optionee
worked, to which the Optionee was assigned or had any responsibility
(either direct or supervisory) at the time of termination of the
Optionee’s employment and at any time during the two-year period
prior to such termination; and

     (2) all of the specific customer accounts, whether within or
outside of the geographic area described in (1) above, with which the
Optionee had any contact or for which the Optionee had any
responsibility (either direct or supervisory) at the time of
termination of the Optionee’s employment and at any time during the
two-year period prior to such termination.

     (B) Extension. If it shall be judicially determined that the
Optionee has violated any of the Optionee’s obligations under Section
7(A)(ii)(b), then the period applicable to each obligation that the Optionee
shall have been determined to have violated shall automatically be extended
by a period of time equal in length to the period during which such
violation(s) occurred.

          (B) Non-Solicitation. Except as otherwise provided in Section 7(A)(i), Detrimental Activity
shall also include directly or indirectly at any time soliciting or inducing or attempting to
solicit or induce any employee(s), sales representative(s), agent(s) or consultant(s) of the
Corporation and/or of its parents, or its other subsidiaries or affiliated or related companies to
terminate their employment, representation or other association with the Corporation and/or its
parent or its other subsidiary or affiliated or related companies.

          (C) Further Covenants. Except as otherwise provided in Section 7(A)(i), Detrimental
Activity shall also include:

     (ii) directly or indirectly, at any time during or after the Optionee’s
employment with the Corporation, disclosing, furnishing, disseminating, making
available or, except in the course of performing the Optionee’s duties of
employment, using any trade secrets or confidential business and technical
information of the Corporation or its customers or vendors, including without
limitation as to when or how the Optionee may have acquired such information. Such
confidential information shall include, without limitation, the Corporation’s unique
selling, manufacturing and servicing methods and business techniques, training,
service and business manuals, promotional materials, training courses and other
training and instructional materials, vendor and product information, customer and
prospective customer lists, other customer and prospective customer information and
other business information. The Optionee specifically acknowledges that all such
confidential information, whether reduced to writing, maintained on any form of
electronic media, or maintained in the Optionee’s mind or memory and whether
compiled by the Corporation, and/or the Optionee, derives independent economic value
from not being readily known to or ascertainable by proper means by others who can
obtain economic value from its

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disclosure or use, that reasonable efforts have been made by the Corporation to
maintain the secrecy of such information, that such information is the sole property
of the Corporation and that any retention and use of such information by the
Optionee during the Optionee’s employment with the Corporation (except in the course
of performing the Optionee’s duties and obligations to the Corporation) or after the
termination of the Optionee’s employment shall constitute a misappropriation of the
Corporation’s trade secrets.

     (iii) Upon termination of the Optionee’s employment with the Corporation, for
any reason, the Optionee’s failure to return to the Corporation, in good condition,
all property of the Corporation, including without limitation, the originals and all
copies of any materials which contain, reflect, summarize, describe, analyze or
refer or relate to any items of information listed in Section 4(C)(i) of this
Agreement.

          (D) Discoveries and Inventions. Except as otherwise provided in Section 7(A)(i),
Detrimental Activity shall also include the failure or refusal of the Optionee to assign to the
Corporation, its successors, assigns or nominees, all of the Optionee’s rights to any discoveries,
inventions and improvements, whether patentable or not, made, conceived or suggested, either solely
or jointly with others, by the Optionee while in the Corporation’s employ, whether in the course of
the Optionee’s employment with the use of the Corporation’s time, material or facilities or that is
in any way within or related to the existing or contemplated scope of the Corporation’s business.
Any discovery, invention or improvement relating to any subject matter with which the Corporation
was concerned during the Optionee’s employment and made, conceived or suggested by the Optionee,
either solely or jointly with others, within one year following termination of the Optionee’s
employment under this Agreement or any successor agreements shall be irrebuttably presumed to have
been so made, conceived or suggested in the course of such employment with the use of the
Corporation’s time, materials or facilities. Upon request by the Corporation with respect to any
such discoveries, inventions or improvements, the Optionee will execute and deliver to the
Corporation, at any time during or after the Optionee’s employment, all appropriate documents for
use in applying for, obtaining and maintaining such domestic and foreign patents as the Corporation
may desire, and all proper assignments therefor, when so requested, at the expense of the
Corporation, but without further or additional consideration.

          (E) Work Made For Hire. Except as otherwise provided in Section 7(A)(i), Detrimental
Activity shall also include violation of the Corporation’s rights in any or all work papers,
reports, documentation, drawings, photographs, negatives, tapes and masters therefor, prototypes
and other materials (hereinafter, “items”), including without limitation, any and all such items
generated and maintained on any form of electronic media, generated by Optionee during the
Optionee’s employment with the Corporation. The Optionee acknowledges that, to the extent
permitted by law, all such items shall be considered a “work made for hire” and that ownership of
any and all copyrights in any and all such items shall belong to the Corporation. The item will
recognize the Corporation as the copyright owner, will contain all proper copyright notices, e.g.,
"(creation date) [Corporation Name], All Rights Reserved,” and will be in condition to be
registered or otherwise placed in compliance with registration or other statutory requirements
throughout the world.

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          (F) Termination for Cause. Except as otherwise provided in Section 7(A)(i),
Detrimental Activity shall also include activity that results in termination for Cause. For the
purposes of this Section, “Cause” shall mean that, the Optionee shall have:

     (iv) been convicted of a criminal violation involving fraud,
embezzlement, theft or violation of federal antitrust statutes or federal
securities laws in connection with his duties or in the course of his
employment with the Corporation or any affiliate of the Corporation;

     (v) committed intentional wrongful damage to property of the
Corporation or any affiliate of the Corporation; or

     (vi) committed intentional wrongful disclosure of secret processes or
confidential information of the Corporation or any affiliate of the
Corporation;

and any such act shall have been demonstrably and materially harmful to the
Corporation.

          (G) Other Injurious Conduct. Detrimental Activity shall also include any other
conduct or act determined to be injurious, detrimental or prejudicial to any significant interest
of the Corporation or any subsidiary unless the Optionee acted in good faith and in a manner he or
she reasonably believed to be in or not opposed to the best interests of the Corporation.

          (H) Reasonableness. The Optionee acknowledges that the Optionee’s obligations under
this Section 4 are reasonable in the context of the nature of the Corporation’s business and the
competitive injuries likely to be sustained by the Corporation if the Optionee were to violate such
obligations. The Optionee further acknowledges that this Agreement is made in consideration of,
and is adequately supported by the agreement of the Corporation to perform its obligations under
this Agreement and by other consideration, which the Optionee acknowledges constitutes good,
valuable and sufficient consideration.

     8. Transferability.

          No SAR granted hereunder may be transferred by the Grantee other than by will or the laws of
descent and distribution and may be exercised during a Grantee’s lifetime only by the Grantee or,
in the event of the Grantee legal incapacity, by the Grantee’s guardian or legal representative
acting in a fiduciary capacity on behalf of the Grantee under state law and court supervision.

     9. Compliance with Law.

          The SARs granted hereby shall not be exercisable if such exercise would involve a violation of
any applicable federal or state securities law, and the Corporation hereby agrees to make
reasonable efforts to comply with any applicable state securities law. If the Ohio Securities Act
shall be applicable to this option, it shall not be exercisable unless under said Act at the time
of exercise the shares of Common Stock or other securities purchasable hereunder are

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exempt, are the subject matter of an exempt transaction, are registered by description or by
qualification, or at such time are the subject matter of a transaction which has been registered by
description.

     10. Adjustments.

          In the event of any change in the aggregate number of outstanding Common Shares by reason of
(a) any stock dividend, stock split, combination of shares, recapitalization or other change in the
capital structure of the Corporation, or (b) any merger, consolidation, spin-off, spin-out,
split-off, split-up, reorganization, partial or complete liquidation of the Corporation or other
distribution of assets, issuance of rights or warrants to purchase securities of the Corporation,
or (c) any other corporate transaction or event having an effect similar to any of the foregoing,
then the Committee shall adjust the number of SARs covered by this Agreement and the Base Price in
such manner as may be appropriate to prevent the dilution or enlargement of the rights of the
Grantee that would otherwise result from such event.

     11. Withholding Taxes.

          To the extent that the Corporation is required to withhold federal, state, local or foreign
taxes in connection with the exercise of the SARs, and the amounts available to the Corporation for
such withholding are insufficient, it shall be a condition to such exercise that the Grantee make
arrangements satisfactory to the Corporation for payment of the balance of such taxes required to
be withheld. The Grantee may elect that all or any part of such withholding requirement be
satisfied by retention by the Corporation of a portion of the Common Shares to be delivered to the
Grantee. If such election is made, the shares so retained shall be credited against such
withholding requirement at the Market Value per Share on the date of such exercise. In no event
shall the Market Value per Share of the Common Shares to be withheld and/or delivered pursuant to
this Section to satisfy applicable withholding taxes in connection with the benefit exceed the
minimum amount of taxes required to be withheld.

     12. Continuous Employment.

          For purposes of this Agreement, the continuous employment of the Grantee with the Corporation
or a Subsidiary shall not be deemed to have been interrupted, and the Grantee shall not be deemed
to have ceased to be an employee of the Corporation or a Subsidiary, by reason of the transfer of
his employment among the Corporation and its Subsidiaries or a leave of absence approved by the
Board.

     13. No Employment Contract; Right to Terminate Employment.

          The grant of the SARs under this Agreement to the Grantee is a voluntary, discretionary award
being made on a one-time basis and it does not constitute a commitment to make any future awards.
The grant of the SARs and any payments made hereunder will not be considered salary or other
compensation for purposes of any severance pay or similar allowance, except as otherwise required
by law. Nothing in this Agreement will give the Grantee any right to continue employment with the
Corporation or any Subsidiary, as the case may be, or interfere in any way with the right of the
Corporation or a Subsidiary to terminate the employment of the Grantee at any time.

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     14. Relation to Other Benefits.

          Any economic or other benefit to the Grantee under this Agreement or the Plan shall not be
taken into account in determining any benefits to which the Grantee may be entitled under any
profit-sharing, retirement or other benefit or compensation plan maintained by the Corporation or a
Subsidiary and shall not affect the amount of any life insurance coverage available to any
beneficiary under any life insurance plan covering employees of the Corporation or a Subsidiary.

     15. Information.

          Information about the Grantee and the Grantee’s participation in the Plan may be collected,
recorded and held, used and disclosed for any purpose related to the administration of the Plan.
The Grantee understands that such processing of this information may need to be carried out by the
Corporation and its Subsidiaries and by third party administrators whether such persons are located
within the Grantee’s country or elsewhere, including the United States of America. The Grantee
consents to the processing of information relating to the Grantee and the Grantee’s participation
in the Plan in any one or more of the ways referred to above.

     16. Amendments.

          Any amendment to the Plan shall be deemed to be an amendment to this agreement to the extent
that the amendment is applicable hereto; provided, however, that no amendment shall
adversely affect the rights of the Grantee with respect to the SARs without the Grantee’s consent.

     17. Severability.

          In the event that one or more of the provisions of this agreement shall be invalidated for any
reason by a court of competent jurisdiction, any provision so invalidated shall be deemed to be
separable from the other provisions hereof, and the remaining provisions hereof shall continue to
be valid and fully enforceable.

     18. Governing Law.

          This agreement is made under, and shall be construed in accordance with the internal
substantive laws of the State of Ohio.

     The undersigned hereby acknowledges receipt of an executed original of this Appreciation
Rights Agreement and accepts the Appreciation Rights granted thereunder on the terms and conditions
set forth herein and in the Plan.

	 	 	 	 	 
	Date: 
	 
	 	 

	 	 	 	  

	 
	 	 	[GRANTEE NAME]

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          Executed in the name and on behalf of the Corporation at Cleveland, Ohio as of the 15th day of
March 2010.

	 	 	 	 	 
	 	BRUSH ENGINEERED MATERIALS INC.

 	 
	 	By:  	 	 
	 	 	 	 
	 	 	 	 
	 

12exv10w1

Exhibit 10.1

NETEZZA CORPORATION

Fiscal 2011 Executive Officer Incentive Bonus Plan

     1. Purpose. The purpose of this Fiscal 2011 Executive Officer Incentive Bonus Plan of
Netezza Corporation (the “Company”) is to enhance the Company’s ability to attract, retain and
motivate executive officers of the Company and to tie a significant portion of the compensation of
executive officers to the attainment of corporate success, thus aligning the incentives of the
executive officers with the creation of value for the stockholders of the Company.

     2. Eligibility. All of the Company’s executive officers, within the meaning of Rule
3b-7 under the Securities Exchange Act of 1934 (the “Participants”), are eligible to receive bonus
payments under this Plan. As of the date of adoption of this Plan,
Jim Baum, Pat Scannell, Patricia Cotter, David Flaxman and Ray Tacoma are Participants in this Plan. If additional persons become
executive officers of the Company during the fiscal year ending January 31, 2011 (“Fiscal 2011”),
they may be added as Participants in this Plan, at the discretion of the Compensation Committee.
Except as is otherwise determined by the Compensation Committee, in order to be eligible to receive
a bonus payment under this Plan, the Participant must be employed by the Company as of the time the
Company first publicly reports its financial results for the fiscal year or fiscal quarter, as
applicable, based upon which the bonus payment is determined.

     3. Period Covered by Plan. This Plan covers Fiscal 2011. Bonus payments for Messrs.
Baum and Scannell will be based on Revenue and Adjusted Operating Income (each as defined below)
for Fiscal 2011. Bonus payments for Ms. Cotter and Mr. Flaxman will be based in part on the
achievement of specified personal objectives relating to Company, departmental and personal
performance in Fiscal 2011 and in part on Revenue and Adjusted Operating Income for Fiscal 2011.
Bonus payments for Mr. Tacoma will be based on Revenue and Bookings (as defined below) in Fiscal
2011 on a quarterly and year-to-date basis.

     4. Administration. This Plan will be administered by the Compensation Committee of
the Company’s Board of Directors. The Compensation Committee shall have authority to adopt, amend
and repeal such administrative rules, guidelines and practices relating to this Plan as it deems
advisable. The Compensation Committee shall have broad discretion to construe and interpret the
terms of this Plan, to make adjustments or amendments to this Plan, and to make determinations as
to whether the criteria for bonus payments have been satisfied. All decisions by the Compensation
Committee shall be made in the Compensation Committee’s sole discretion and shall be final and
binding on all Participants and all persons having or claiming any interest in this Plan. No
member of the Compensation Committee shall be liable for any action or determination relating to or
under this Plan.

     5. Bonus Payments — Mr. Baum and Mr. Scannell. This Section 5 covers the bonuses
payable to Mr. Baum and Mr. Scannell. All references in this Section 5 to “Participants” means
each of Mr. Baum and Mr. Scannell.

          (a) Target Bonuses. Each Participant has a target bonus for Fiscal 2011 under this
Plan (the “Target Bonus”), which is set forth below. In addition, each Participant’s Target Bonus
is allocated between, and determined based upon, the following two criteria:

 

 

	 	•	 	Revenue — for purposes of this Plan, “Revenue” means the Company’s revenue as
determined in accordance with generally accepted accounting principles (“GAAP”) and
reported in a filing by the Company with the SEC; and
	 
	 	•	 	Adjusted Operating Income — for purposes of this Plan, “Adjusted Operating
Income” means the Company’s operating income, as determined in accordance with GAAP
and reported in a filing by the Company with the SEC, plus the amount of operating
expenses attributable to (i) outstanding equity awards computed in accordance with
FASB Statement of Financial Accounting Standards No. 123R, (ii) amortization of
acquired intangible assets and (iii) any other operating expenses excluded from the
“Non-GAAP Operating Income” line item set forth in the Company’s earnings release
relating to Fiscal 2011 filed with the SEC.

The portion of a Participant’s Target Bonus that is allocated to Revenue is referred to in this
Plan as the “Revenue Target Bonus”; and the portion of a Participant’s Target Bonus that is
allocated to Adjusted Operating Income is referred to in this Plan as the “Adjusted Operating
Income Target Bonus”.

     The Target Bonus, and allocation of that Target Bonus between the Revenue Target Bonus and the
Adjusted Operating Income Target Bonus, for each Participant is as follows:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Target Bonus	 	Revenue Target	 	Adjusted Operating
	Name	 	% of Base Salary	 	Dollars	 	Bonus	 	Income Target Bonus
	Jim Baum
	 	 	100	%	 	$	400,000	 	 	$	200,000	 	 	$	200,000	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Pat Scannell
	 	 	60	%	 	$	180,000	 	 	$	90,000	 	 	$	90,000	 

          (b) Revenue Targets and Adjusted Operating Income Targets. For purposes of this
Plan, (i) the Company’s Revenue target for Fiscal 2011 is as set forth in the Fiscal 2011 operating
plan approved by the Board of Directors at its January 22, 2010 meeting and attached to the minutes
of such meeting (the “Fiscal 2011 Plan”) and (ii) the Company’s Adjusted Operating Income target
for Fiscal 2011 is as set forth in the Fiscal 2011 Plan (in the line item “Operating Profit”). The
Compensation Committee may adjust for purposes of this Plan the Revenue target and the Adjusted
Operating Income target for Fiscal 2011 in such manner as it shall determine in its discretion in
the event the Company acquires another company or business during Fiscal 2011 and/or to reflect
other unusual events that occur during the year.

          (c) Calculation of Revenue Bonuses. The Company will pay to each Participant an
annual bonus based on Revenue during Fiscal 2011, calculated as follows:

	 	•	 	no Revenue bonus will be paid unless the Company attains 80% of its Revenue
target for Fiscal 2011;
	 
	 	•	 	if the Company attains from 80% up to and including 90% of its Revenue target
for Fiscal 2011, the Company will pay each Participant a Revenue bonus of between
20% and 50% of each Participant’s Revenue Target Bonus, with the

-2-

 

	 	 	 	applicable percentage equal to (i) 20% plus (ii) (a) 30% (representing the spread
between 20% and 50%) multiplied by (b) (1) actual Revenue for Fiscal 2011 as a
percentage of the Revenue target less 80%, divided by (2) the 10% spread between 80%
and 90% (for example, attainment of 87% of the Revenue target for Fiscal 2011 would
result in the payment of (i) 20% plus (ii) (a) 30% x (b) (1) 87% less 80% (or 7%)
/(2) 10%, or 41%, of each Participant’s Revenue Target Bonus);
	 
	 	•	 	if the Company attains from 90% up to and including 100% of its Revenue target
for Fiscal 2011, the Company will pay each Participant a Revenue bonus of between
50% and 100% of each Participant’s Revenue Target Bonus, with the applicable
percentage equal to (i) 50% plus (ii) (a) 50% (representing the spread between 50%
and 100%) multiplied by (b) (1) actual Revenue for Fiscal 2011 as a percentage of
the Revenue target less 90%, divided by (2) the 10% spread between 90% and 100%
(for example, attainment of 94% of the Revenue target for Fiscal 2011 would result
in the payment of (i) 50% plus (ii) (a) 50% x (b) (1) 94% less 90% (or 4%) /(2)
10%, or 70%, of each Participant’s Revenue Target Bonus); and
	 
	 	•	 	if the Company attains more than 100% of its Revenue target for Fiscal 2011, the
Company will pay each Participant a Revenue bonus equal to such percentage of the
Participant’s Revenue Target Bonus as is equal to actual Revenue for Fiscal 2011 as
a percentage of the Revenue target (for example, attainment of 116% of the Revenue
target for Fiscal 2011 would result in the payment of 116% of each Participant’s
Revenue Target Bonus), subject to a maximum payment of 150% of the Participant’s
Revenue Target Bonus.

     The Company will pay the bonuses payable under this Section 5(c) as promptly as practicable
following the meeting of the Compensation Committee at which the Company’s operating results for
Fiscal 2011 and the bonuses due pursuant to this Section 5(c) are presented to the Compensation
Committee.

          (d) Calculation of Adjusted Operating Income Bonuses. The Company will pay to each
Participant an annual bonus based on Adjusted Operating Income during Fiscal 2011, calculated as
follows:

	 	•	 	no Adjusted Operating Income bonus will be paid unless the Company attains 80%
of its Adjusted Operating Income target for Fiscal 2011;
	 
	 	•	 	if the Company attains from 80% up to and including 90% of its Adjusted
Operating Income target for Fiscal 2011, the Company will pay each Participant an
Adjusted Operating Income bonus of between 20% and 50% of each Participant’s
Adjusted Operating Income Target Bonus, with the applicable percentage equal to (i)
20% plus (ii) (a) 30% (representing the spread between 20% and 50%) multiplied by
(b) (1) actual Adjusted Operating Income for Fiscal 2011 as a percentage of the
Adjusted Operating Income target less 80%, divided by (2) the 10% spread between
80% and 90%;

-3-

 

	 	•	 	if the Company attains from 90% up to and including 100% of its Adjusted
Operating Income target for Fiscal 2011, the Company will pay each Participant an
Adjusted Operating Income bonus of between 50% and 100% of each Participant’s
Adjusted Operating Income Target Bonus, with the applicable percentage equal to (i)
50% plus (ii) (a) 50% (representing the spread between 50% and 100%) multiplied by
(b) (1) actual Adjusted Operating Income for Fiscal 2011 as a percentage of the
Adjusted Operating Income target less 90%, divided by (2) the 10% spread between
90% and 100%; and
	 
	 	•	 	if the Company attains more than 100% of its Adjusted Operating Income target
for Fiscal 2011, the Company will pay each Participant an Adjusted Operating Income
bonus equal to such percentage of the Participant’s Adjusted Operating Income
Target Bonus as is equal to actual Adjusted Operating Income for Fiscal 2011 as a
percentage of the Adjusted Operating Income target, subject to a maximum payment of
150% of the Participant’s Adjusted Operating Income Target Bonus.

     The Company will pay the bonuses payable under this Section 5(d) as promptly as practicable
following the meeting of the Compensation Committee at which the Company’s operating results for
Fiscal 2011 and the bonuses due pursuant to this Section 5(d) are presented to the Compensation
Committee.

     6. Bonus Payments — Ms. Cotter and Mr. Flaxman. This Section 6 covers the bonuses
payable to Ms. Cotter and Mr. Flaxman. All references in this Section 6 to “Participants” means
each of Ms. Cotter and Mr. Flaxman.

          (a) Target Bonuses. Each Participant has a target bonus for Fiscal 2011 under this
Plan (the “Target Bonus”), which is set forth below. Each Participant’s Target Bonus is allocated
between, and determined based upon, the achievement of Company, department and/or personal
objectives that shall be communicated to the Participant in writing by the Chief Executive Officer
of the Company in the first fiscal quarter of Fiscal 2011 (each, a “Performance Objective”), with
each Performance Objective relating to a specified portion of the Participant’s Target Bonus as
specified in such communication.

     The Target Bonus for each Participant is as follows:

	 	 	 	 	 	 	 	 	 
	 	 	Target Bonus
	Name	 	% of Base Salary	 	Dollars
	Patricia Cotter
	 	 	50	%	 	$	107,500	 
	David Flaxman
	 	 	50	%	 	$	142,500	 

          (b) Following the completion of Fiscal 2011 and prior to the meeting of the Compensation
Committee at which the Company’s operating results for Fiscal 2011 are presented to the
Compensation Committee, the Chief Executive Officer shall present to the Compensation Committee an
assessment of each Participant’s achievement of each of such Participant’s Performance Objectives
stated as a percentage between 0% and 100%. The respective percentage achievement levels of each
Participant’s Performance Objectives shall be multiplied by the applicable portions of such
Participant’s Target Bonus relating to those

-4-

 

Performance Objectives to determine the aggregate potion of each Participant’s Target Bonus that the Participant shall be eligible to receive (such Participant’s “Adjusted Target Bonus”).

          (c) The amount of each Participant’s Adjusted Target Bonus shall be allocated between, and
earned based upon, Revenue (as defined above) and Adjusted Operating Income (as defined above) as
follows:

	 	•	 	50% of the Participant’s Adjusted Target Bonus shall be based upon Revenue and
	 
	 	•	 	50% of the Participant’s Adjusted Target Bonus shall be based upon Adjusted
Operating Income.

          (d) The portion of a Participant’s Adjusted Target Bonus that is based upon Revenue is
referred to in this Plan as the “Revenue Adjusted Target Bonus”; and the portion of a Participant’s
Adjusted Target Bonus that is based upon Adjusted Operating Income is referred to in this Plan as
the “Adjusted Operating Income Adjusted Target Bonus”.

          (e) Calculation of Revenue Adjusted Bonuses. The Company will pay to each Participant
an annual bonus adjusted based on Revenue during Fiscal 2011, calculated as follows:

	 	•	 	no Revenue performance bonus will be paid unless the Company attains 80% of its
Revenue target for Fiscal 2011;
	 
	 	•	 	if the Company attains from 80% up to and including 90% of its Revenue target
for Fiscal 2011, the Company will pay each Participant a Revenue performance bonus
of between 20% and 50% of each Participant’s Revenue Adjusted Target Bonus, with
the applicable percentage equal to (i) 20% plus (ii) (a) 30% (representing the
spread between 20% and 50%) multiplied by (b) (1) actual Revenue for Fiscal 2011 as
a percentage of the Revenue target less 80%, divided by (2) the 10% spread between
80% and 90% (for example, attainment of 87% of the Revenue target for Fiscal 2011
would result in the payment of (i) 20% plus (ii) (a) 30% x (b) (1) 87% less 80%
(or 7%) /(2) 10%, or 41%, of each Participant’s Revenue Adjusted Target Bonus);
	 
	 	•	 	if the Company attains from 90% up to and including 100% of its Revenue target
for Fiscal 2011, the Company will pay each Participant a Revenue performance bonus
of between 50% and 100% of each Participant’s Revenue Adjusted Target Bonus, with
the applicable percentage equal to (i) 50% plus (ii) (a) 50% (representing the
spread between 50% and 100%) multiplied by (b) (1) actual Revenue for Fiscal 2011
as a percentage of the Revenue target less 90%, divided by (2) the 10% spread
between 90% and 100% (for example, attainment of 94% of the Revenue target for
Fiscal 2011 would result in the payment of (i) 50% plus (ii) (a) 50% x (b) (1) 94%
less 90% (or 4%) /(2) 10%, or 70%, of each Participant’s Revenue Adjusted Target
Bonus); and
	 
	 	•	 	if the Company attains more than 100% of its Revenue target for Fiscal 2011, the
Company will pay each Participant a Revenue performance bonus equal to such
percentage of the Participant’s Revenue Adjusted Target Bonus as is equal to

-5-

 

	 	 	 	actual Revenue for Fiscal 2011 as a percentage of the Revenue target (for example,
attainment of 116% of the Revenue target for Fiscal 2011 would result in the payment
of 116% of each Participant’s Revenue Adjusted Target Bonus), subject to a maximum
payment of 150% of the Participant’s Revenue Adjusted Target Bonus.

     The Company will pay the bonuses payable under this Section 6(e) as promptly as practicable
following the meeting of the Compensation Committee at which the Chief Executive Officer’s
assessment of each Participant’s achievement of Performance Objectives, the Company’s operating
results for Fiscal 2011 and the bonuses due pursuant to this Section 6(e) are presented to the
Compensation Committee.

          (f) Calculation of Adjusted Operating Income Adjusted Bonuses. The Company will pay
to each Participant an annual bonus based on Adjusted Operating Income during Fiscal 2011,
calculated as follows:

	 	•	 	no Adjusted Operating Income performance bonus will be paid unless the Company
attains 80% of its Adjusted Operating Income target for Fiscal 2011;
	 
	 	•	 	if the Company attains from 80% up to and including 90% of its Adjusted
Operating Income target for Fiscal 2011, the Company will pay each Participant an
Adjusted Operating Income performance bonus of between 20% and 50% of each
Participant’s Adjusted Operating Income Adjusted Target Bonus, with the applicable
percentage equal to (i) 20% plus (ii) (a) 30% (representing the spread between 20%
and 50%) multiplied by (b) (1) actual Adjusted Operating Income for Fiscal 2011 as
a percentage of the Adjusted Operating Income target less 80%, divided by (2) the
10% spread between 80% and 90%;
	 
	 	•	 	if the Company attains from 90% up to and including 100% of its Adjusted
Operating Income target for Fiscal 2011, the Company will pay each Participant an
Adjusted Operating Income performance bonus of between 50% and 100% of each
Participant’s Adjusted Operating Income Adjusted Target Bonus, with the applicable
percentage equal to (i) 50% plus (ii) (a) 50% (representing the spread between 50%
and 100%) multiplied by (b) (1) actual Adjusted Operating Income for Fiscal 2011 as
a percentage of the Adjusted Operating Income target less 90%, divided by (2) the
10% spread between 90% and 100%; and
	 
	 	•	 	if the Company attains more than 100% of its Adjusted Operating Income target
for Fiscal 2011, the Company will pay each Participant an Adjusted Operating Income
performance bonus equal to such percentage of the Participant’s Adjusted Operating
Income Adjusted Target Bonus as is equal to actual Adjusted Operating Income for
Fiscal 2011 as a percentage of the Adjusted Operating Income target, subject to a
maximum payment of 150% of the Participant’s Adjusted Operating Income Adjusted
Target Bonus.

     The Company will pay the bonuses payable under this Section 6(f) as promptly as practicable
following the meeting of the Compensation Committee at which the Chief Executive Officer’s
assessment of each Participant’s achievement of Performance Objectives, the

-6-

 

Company’s operating results for Fiscal 2011 and the bonuses due pursuant to this Section 6(f)
are presented to the Compensation Committee.

     7. Bonus Payments — Mr. Tacoma. This Section 7 covers the bonuses payable to Mr.
Tacoma.

          (a) Target Bonus. Mr. Tacoma’s Target Bonus for Fiscal 2011 is $330,000. His Target
Bonus is allocated among, and determined based upon, the following two criteria:

	 	•	 	Revenue (as defined above); and
	 
	 	•	 	Bookings — for purposes of this Plan, “Bookings” means the Company’s product
bookings (excluding maintenance bookings), as determined in accordance with its
internal bookings policy.

     Mr. Tacoma’s Target Bonus of $330,000 is allocated as follows:

	 	•	 	$100,000 (or $25,000 per quarter) is allocated to Revenue, and the $25,000
quarterly target is referred to as his “Quarterly Revenue Target Bonus”;
	 
	 	•	 	$130,000 (or $32,500 per quarter) is allocated to Bookings, and the $32,500
quarterly target is referred to as his “Quarterly Bookings Target Bonus”; and
	 
	 	•	 	$100,000 — broken down as $15,000 through the end of the first quarter, $20,000
through the end of the second quarter, $25,000 through the end of the third quarter
and $40,000 through the end of the fourth quarter — is allocated to year-to-date
Bookings and is referred to as his “Year-to-Date Bookings Target Bonus”.

             (b) Revenue Targets and Bookings Targets. For purposes of this Plan, (i) the
Company’s Revenue targets for each quarter of Fiscal 2011 and for Fiscal 2011 as a whole are as set
forth in the Fiscal 2011 Plan, (ii) the Company’s Bookings targets for each quarter of Fiscal 2011
and for Fiscal 2011 as a whole are as set forth in the Fiscal 2011 Plan (in the line item “Product
Bookings”) and (iii) the Company’s year-to-date Bookings targets through the end of each quarter of
Fiscal 2011 are calculated by adding such quarterly Bookings targets for the applicable quarters.
The Compensation Committee may adjust for purposes of this Plan the Revenue targets and the
Bookings targets for each quarter of Fiscal 2011 in such manner as it shall determine in its
discretion in the event the Company acquires another company or business during Fiscal 2011 and/or
to reflect other unusual events that occur during the year.

             (c) Calculation of Revenue Bonuses. The Company will pay to Mr. Tacoma bonuses based
on Revenue for each quarter of Fiscal 2011 and for Fiscal 2011 as a whole, calculated as follows:

	 	•	 	no quarterly Revenue bonus will be paid unless the Company attains 80% of its
Revenue target for a quarter;
	 
	 	•	 	if the Company attains from 80% up to and including 100% of its Revenue target
for a quarter, the Company will pay Mr. Tacoma a quarterly Revenue bonus equal to
(i) his Quarterly Revenue Target Bonus multiplied by (ii) actual Revenue for

-7-

 

	 	 	 	such quarter as a percentage of the Revenue target for such quarter (for example,
attainment of 87% of the Revenue target for a particular quarter would result in the
payment of 87% of Mr. Tacoma’s Quarterly Revenue Target Bonus);
	 
	 	•	 	if the Company attains more than 100% of its Revenue target for a quarter, the
Company will pay Mr. Tacoma a quarterly Revenue bonus equal to 100% of his
Quarterly Revenue Target Bonus; and
	 
	 	•	 	if the Company attains more than 100% of its Revenue target for Fiscal 2011, the
Company will pay Mr. Tacoma an annual Revenue bonus equal to (i) (A) $100,000
multiplied by (B) actual Revenue for Fiscal 2011 as a percentage of the Revenue
target for Fiscal 2011 (for example, if the Company attained 106% of its Revenue
target for Fiscal 2011, the amount calculated under this clause (i) would be
$106,000), provided that the amount calculated under this clause (i) shall in no
event be more than $150,000, less (ii) $100,000.

     The Company will pay the bonuses payable under this Section 7(c) as promptly as practicable
following the meeting of the Compensation Committee at which the Company’s operating results for
the applicable quarter and/or Fiscal 2011 and the bonus due pursuant to this Section 7(c) are
presented to the Compensation Committee.

             (d) Calculation of Bookings Bonuses. The Company will pay to Mr. Tacoma bonuses based
on Bookings for each quarter of Fiscal 2011 and for Fiscal 2011 as a whole, calculated as follows:

	 	•	 	no quarterly Bookings bonus will be paid unless the Company attains 80% of its
Bookings target for a quarter;
	 
	 	•	 	if the Company attains from 80% up to and including 100% of its Bookings target
for a quarter, the Company will pay Mr. Tacoma a quarterly Bookings bonus equal to
(i) his Quarterly Bookings Target Bonus multiplied by (ii) actual Bookings for such
quarter as a percentage of the Bookings target for such quarter;
	 
	 	•	 	if the Company attains more than 100% of its Bookings target for a quarter, the
Company will pay Mr. Tacoma a quarterly Bookings bonus equal to 100% of his
Quarterly Bookings Target Bonus; and
	 
	 	•	 	if the Company attains more than 100% of its Bookings target for Fiscal 2011,
the Company will pay Mr. Tacoma an annual Bookings bonus equal to (i) (A) $130,000
multiplied by (B) actual Bookings for Fiscal 2011 as a percentage of the Bookings
target for Fiscal 2011, provided that the amount calculated under this clause (i)
shall in no event be more than $195,000, less (ii) $130,000.

     The Company will pay the bonuses payable under this Section 7(d) as promptly as practicable
following the meeting of the Compensation Committee at which the Company’s operating results for
the applicable quarter and/or Fiscal 2011 and the bonus due pursuant to this Section 7(d) are
presented to the Compensation Committee.

-8-

 

          (e) Calculation of Year-to-Date Bookings Bonuses. The Company will pay to Mr. Tacoma
bonuses based on year-to-date Bookings through the end of each quarter of Fiscal 2011, calculated
as follows:

	 	•	 	no year-to-date Bookings bonus will be paid unless the Company attains 100% of
its Bookings target through the end of such quarter;
	 
	 	•	 	if the Company attains 100% or more of its year-to-date Bookings target through
the end of such quarter, the Company will pay Mr. Tacoma a year-to-date Bookings
bonus equal to his Year-to-Date Bookings Target Bonus through the end of such
quarter; and
	 
	 	•	 	if the Company attains 80% or more of its Bookings target for Fiscal 2011, the
Company will (if applicable) pay Mr. Tacoma an additional year-to-date Bookings
bonus equal to (i) (A) $80,000 multiplied by (B) actual Bookings for Fiscal 2011 as
a percentage of the Bookings target for Fiscal 2011 less (ii) the total amount he
receives under this Section 7(e) for attaining the year-to-date Bookings targets
through the end of each quarter during Fiscal 2011. For example, if the Company
attains its year-to-date Bookings target through the end of the first quarter
(resulting in a payment of ($15,000), does not attain such targets through the end
of the second or third quarters, and attains 95% of its bookings target for Fiscal
2011 as a whole, Mr. Tacoma would receive under this clause an additional payment
of $61,000 (95% of $80,000, less $15,000).

     The Company will pay the bonuses payable under this Section 7(e) as promptly as practicable
following the meeting of the Compensation Committee at which the Company’s operating results for
the applicable quarter and/or Fiscal 2011 and the bonus due pursuant to this Section 7(e) are
presented to the Compensation Committee.

     8. Acquisition of the Company.

          (a) This Plan shall terminate effective immediately prior to an Acquisition (as defined below)
of the Company. Notwithstanding the foregoing, (i) any bonus payments due with respect to a fiscal
period that ended prior to such Acquisition shall be paid to Participants in the manner provided
for in this Plan on or prior to the closing of the Acquisition and (ii) if an Acquisition occurs
following the end of the first quarter of Fiscal 2011 and before the end of Fiscal 2011, Section 5
of this Plan shall be deemed to be modified such that (A) the Target Bonuses set forth therein
shall be proportionately adjusted based on the number of completed quarters prior to the
Acquisition (for example, if the Acquisition occurs in the third quarter, Mr. Baum’s Revenue Target
Bonus would become $100,000), (B) the Revenue and Adjusted Operating Income targets would be
reduced to the Revenue and Adjusted Operating Income targets set forth in the Fiscal 2011 Plan
through the end of the last full quarter ended prior to the Acquisition, and (C) the Company shall
calculate and pay Revenue and Adjusted Operating Income bonuses pursuant to the provisions of
Section 5, adjusted in the manner provided for in this sentence, on or prior to the closing of the
Acquisition.

          (b) “Acquisition” means (i) any merger or consolidation in which (A) the Company is a
constituent party or (B) a subsidiary of the Company is a constituent party and the Company issues
shares of its capital stock pursuant to such merger or consolidation (except, in

-9-

 

the case of both clauses (A) and (B) above, any such merger or consolidation involving the
Company or a subsidiary in which the holders of capital stock of the Company immediately prior to
such merger or consolidation continue to hold immediately following such merger or consolidation at
least 51% by voting power of the capital stock of (x) the surviving or resulting corporation or (y)
if the surviving or resulting corporation is a wholly owned subsidiary of another corporation
immediately following such merger or consolidation, the parent corporation of such surviving or
resulting corporation) or (ii) the sale or transfer, in a single transaction or series of related
transactions, of capital stock representing at least 51% of the voting power of the outstanding
capital stock of the Company immediately following such transaction or (iii) the sale of all or
substantially all of the assets of the Company.

     9. Withholding Taxes. The Company may deduct from any payment otherwise due to
Participants under this Plan any amount required to be withheld by the Company under applicable
federal, state, and local or other income and employment tax withholding laws and regulations. If
the Company elects not to or cannot withhold such amounts from payments due to a Participant, each
Participant must pay the Company the full amount, if any, required for withholding.

     10. Miscellaneous Provisions

          (a) Non-transferability of Rights. The rights to a payment of a bonus under this Plan
may not be sold, transferred, pledged, hypothecated or otherwise disposed of.

          (b) No Right to Continued Employment. The opportunity to receive a bonus under this
Plan shall not be construed as giving a Participant the right to continued employment or any other
relationship with the Company. The Company expressly reserves the right at any time to dismiss or
otherwise terminate its relationship with a Participant free from any liability or claim under this
Plan.

          (c) Severability. The invalidity or unenforceability of any provision of this Plan
shall not affect the validity or enforceability of any other provision of this Agreement, and each
other provision of this Plan shall be severable and enforceable to the extent permitted by law.

          (d) Amendment and Termination. The Compensation Committee may amend or terminate this
Plan or any portion thereof at any time.

          (e) Compliance With Code Section 409A. Notwithstanding any other provision of this
Plan to the contrary, all bonus payments made hereunder shall be made no later than April 15, 2011.
The Company shall have no liability to a Participant, or any other party, if an Award that is
intended to be exempt from, or compliant with, Section 409A is not so exempt or compliant.

          (f) Governing Law. This Plan shall be construed, interpreted and enforced in
accordance with the internal laws of the Commonwealth of Massachusetts without regard to any
applicable conflicts of laws.

-10-

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